Technology

Avantor® Reports Third Quarter 2024 Results

Published

2 years ago

October 25, 2024

Net sales of $1.71 billion, decrease of 0.3%; organic decline of 0.7%Net income of $57.8 million; Adjusted EBITDA of $302.5 millionDiluted GAAP EPS of $0.08; adjusted EPS of $0.26Operating cash flow of $244.8 million; free cash flow of $204.0 million

RADNOR, Pa., Oct. 25, 2024 /PRNewswire/ — Avantor, Inc. (NYSE: AVTR), a leading global provider of mission-critical products and services to customers in the life sciences and advanced technology industries, today reported financial results for its third fiscal quarter ended September 30, 2024.

“Our team delivered another quarter of solid financial results, including outperformance in bioprocessing and a return to growth in our laboratory solutions segment. Our disciplined approach to working capital drove another quarter of best-in-class free cash flow conversion and we are raising our free cash flow guidance for the year,” said Michael Stubblefield, President and Chief Executive Officer.

“As we enter the fourth quarter, we remain on track to realize mid to high single-digit growth in our bioprocessing business, supported by continued momentum in order intake. Our cost transformation programs are running ahead of plan, and we are well positioned to achieve our full year guidance. Moving forward, we remain focused on delivering long-term growth for Avantor and differentiated value to our customers and shareholders,” Stubblefield concluded.

Third Quarter 2024

For the three months ended September 30, 2024, net sales were $1,714.4 million, a decrease of 0.3% compared to the third quarter of 2023. Foreign currency translation had a positive impact of 0.4%, resulting in a sales decline of 0.7% on an organic basis.

Net income decreased to $57.8 million from $108.4 million in the third quarter of 2023, and adjusted net income was $175.2 million as compared to $171.6 million in the comparable prior period. Net Income margin was 3.4%. Adjusted EBITDA was $302.5 million and Adjusted EBITDA margin was 17.6%. Adjusted Operating Income was $274.8 million and Adjusted Operating Income margin was 16.0%.

Diluted earnings per share on a GAAP basis was $0.08, while adjusted EPS was $0.26.

Operating cash flow was $244.8 million, while free cash flow was $204.0 million. Adjusted net leverage was 3.8x as of September 30, 2024.

Third Quarter 2024 – Segment Results

Laboratory Solutions

Net sales were $1,171.5 million, a reported increase of 1.1%, as compared to $1,159.1 million in the third quarter of 2023. Sales increased 0.6% on an organic basis.Adjusted Operating Income was $151.5 million as compared to $159.1 million in the comparable prior period. Adjusted Operating Income margin was 12.9%.

Bioscience Production

Net sales were $542.9 million, a reported decrease of 3.2%, as compared to $561.1 million in the third quarter of 2023. Sales declined 3.5% on an organic basis.Adjusted Operating Income was $138.1 million as compared to $148.2 million in the comparable prior period. Adjusted Operating Income margin was 25.4%.

Adjusted Operating Income is Avantor’s segment reporting profitability measure under generally accepted accounting principles and is used by management to measure and evaluate the performance of our Company’s business segments.

Conference Call
We will host a conference call to discuss our results today, October 25, 2024, at 8:00 a.m. Eastern Time. The live webcast and presentation, as well as a replay, will be available on the investor section of Avantor’s website.

About Avantor
Avantor® is a leading life science tools company and global provider of mission-critical products and services to the life sciences and advanced technology industries. We work side-by-side with customers at every step of the scientific journey to enable breakthroughs in medicine, healthcare, and technology. Our portfolio is used in virtually every stage of the most important research, development and production activities at more than 300,000 customer locations in 180 countries. For more information, visit avantorsciences.com and find us on LinkedIn, X (Twitter) and Facebook.

Use of Non-GAAP Financial Measures
To evaluate our performance, we monitor a number of key indicators. As appropriate, we supplement our results of operations determined in accordance with U.S. generally accepted accounting principles (“GAAP”) with certain non-GAAP financial measures that we believe are useful to investors, creditors and others in assessing our performance. These measures should not be considered in isolation or as a substitute for reported GAAP results because they may include or exclude certain items as compared to similar GAAP-based measures, and such measures may not be comparable to similarly titled measures reported by other companies. Rather, these measures should be considered as an additional way of viewing aspects of our operations that provide a more complete understanding of our business. We strongly encourage investors to review our consolidated financial statements included in reports filed with the SEC in their entirety and not rely solely on any one single financial measure or communication.

The non-GAAP financial measures used in this press release are sales growth (decline) on an organic basis, Adjusted Operating Income, Adjusted Operating Income margin, Adjusted EBITDA, Adjusted EBITDA margin, adjusted net income, adjusted EPS, adjusted net leverage, free cash flow and free cash flow conversion.

Organic net sales growth (decline) eliminates from our reported net sales change the impacts of revenues from acquisitions and divestitures that occurred in the last year and changes in foreign currency exchange rates. We believe that this measurement is useful to investors as a way to measure and evaluate our underlying commercial operating performance consistently across our segments and the periods presented. This measure is used by our management for the same reason.Adjusted Operating Income is our net income or loss adjusted for the following items: (i) interest expense, (ii) income tax expense, (iii) amortization of acquired intangible assets, (iv) losses on extinguishment of debt, (v) charges associated with the impairment of certain assets, (vi) and certain other adjustments. Adjusted Operating Income margin is Adjusted Operating Income divided by net sales as determined under GAAP. We believe that these measures are useful to investors as ways to analyze the underlying trends in our business consistently across the periods presented. These measures are used by our management for the same reason. Additionally, Adjusted Operating Income is our segment reporting profitability measure under GAAP.Adjusted EBITDA is our net income or loss adjusted for the following items: (i) interest expense, (ii) income tax expense, (iii) amortization of acquired intangible assets, (iv) depreciation expense, (v) losses on extinguishment of debt, (vi) charges associated with the impairment of certain assets, (vii) and certain other adjustments. Adjusted EBITDA margin is Adjusted EBITDA divided by net sales as determined under GAAP. We believe that these measures are useful to investors as ways to analyze the underlying trends in our business consistently across the periods presented. These measures are used by our management for the same reason.Adjusted net income is our net income or loss first adjusted for the following items: (i) amortization of acquired intangible assets, (ii) losses on extinguishment of debt, (iii) charges associated with the impairment of certain assets, (iv) and certain other adjustments. From this amount, we then add or subtract an assumed incremental income tax impact on the above-noted pre-tax adjustments, using estimated tax rates, to arrive at Adjusted Net Income. We believe that this measure is useful to investors as a way to analyze the business consistently across the periods presented. This measure is used by our management for the same reason.Adjusted EPS is our adjusted net income divided by our diluted GAAP weighted average share count adjusted for anti-dilutive instruments. We believe that this measure is useful to investors as an additional way to analyze the underlying trends in our business consistently across the periods presented. This measure is used by our management for the same reason.Adjusted net leverage is equal to our gross debt, reduced by our cash and cash equivalents, divided by our trailing 12-month Adjusted EBITDA (excluding stock-based compensation expense and including the expected run-rate effect of cost synergies and the incremental results of completed acquisitions and divestitures as if those acquisitions and divestitures had occurred on the first day of the trailing 12-month period). We believe that this measure is useful to investors as a way to evaluate and measure the Company’s capital allocation strategies and the underlying trends in the business. This measure is used by our management for the same reason.Free cash flow is equal to our cash flows from operating activities, less capital expenditures, plus the direct costs to close acquisitions and divestitures (including income tax effects, if any) in the period. Free cash flow conversion is free cash flow divided by adjusted net income. We believe that these measures are useful to investors as they provide a view on the Company’s ability to generate cash for use in financing or investment activities. These measures are used by our management for the same reason.

Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables accompanying this release.

Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this press release are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial condition, results of operations, plans, including our cost transformation initiative, objectives, future performance and business. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “assumption,” “believe,” “continue,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “intend,” “likely,” “long-term,” “near-term,” “objective,” “opportunity,” “outlook,” “plan,” “potential,” “project,” “projection,” “prospects,” “seek,” “target,” “trend,” “can,” “could,” “may,” “should,” “would,” “will,” the negatives thereof and other words and terms of similar meaning.

Forward-looking statements are inherently subject to risks, uncertainties and assumptions; they are not guarantees of performance. You should not place undue reliance on these statements. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that our assumptions made in connection with the forward-looking statements are reasonable, we cannot assure you that the assumptions and expectations will prove to be correct. Factors that could contribute to these risks, uncertainties and assumptions include, but are not limited to, the factors described in “Risk Factors” in our most recent Annual Report on Form 10-K, and subsequent quarterly reports on Form 10-Q, as such risk factors may be updated from time to time in our periodic filings with the SEC.

All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. In addition, all forward-looking statements speak only as of the date of this press release. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise other than as required under the federal securities laws.

Investor Relations Contact
Christina Jones
Vice President, Investor Relations
Avantor
+1 805-617-5297
Christina.Jones@avantorsciences.com

Media Contact
Eric Van Zanten
Head of External Communications
Avantor
+1 610-529-6219
Eric.Vanzanten@avantorsciences.com

Avantor, Inc. and subsidiaries

Unaudited condensed consolidated statements of operations

(in millions, except per share data)

Three months ended
September 30,

Nine months ended
September 30,

2024

2023

2024

2023

Net sales

$ 1,714.4

$ 1,720.2

$ 5,097.0

$ 5,244.4

Cost of sales

1,150.0

1,141.6

3,380.6

3,451.0

Gross profit

564.4

578.6

1,716.4

1,793.4

Selling, general and administrative expenses

439.8

368.4

1,269.7

1,119.5

Impairment charges

—

160.8

Operating income

124.6

210.2

446.7

513.1

Interest expense, net

(48.7)

(72.4)

(173.9)

(219.5)

Loss on extinguishment of debt

(2.1)

(2.0)

(6.5)

(5.9)

Other income, net

0.7

3.4

3.3

Income before income taxes

74.5

136.5

269.7

291.0

Income tax expense

(16.7)

(28.1)

(58.6)

(68.4)

Net income

$ 57.8

$ 108.4

$ 211.1

$ 222.6

Earnings per share:

Basic

$ 0.08

$ 0.16

$ 0.31

$ 0.33

Diluted

$ 0.08

$ 0.16

$ 0.31

$ 0.33

Weighted average shares outstanding:

Basic

680.3

676.0

679.3

675.4

Diluted

683.0

678.5

682.1

678.1

Avantor, Inc. and subsidiaries

Unaudited condensed consolidated balance sheets

(in millions)

September 30, 2024

December 31, 2023

Assets

Current assets:

Cash and cash equivalents

$ 285.3

$ 262.9

Accounts receivable, net

1,087.7

1,150.2

Inventory

779.6

828.1

Other current assets

135.6

143.7

Assets held for sale

216.5

—

Total current assets

2,504.7

2,384.9

Property, plant and equipment, net

722.8

737.5

Other intangible assets, net

3,522.7

3,775.3

Goodwill, net

5,670.6

5,716.7

Other assets

419.8

358.3

Total assets

$ 12,840.6

$ 12,972.7

Liabilities and stockholders’ equity

Current liabilities:

Current portion of debt

$ 229.7

$ 259.9

Accounts payable

673.5

625.9

Employee-related liabilities

183.3

133.1

Accrued interest

39.9

50.2

Other current liabilities

401.7

411.2

Liabilities held for sale

101.7

—

Total current liabilities

1,629.8

1,480.3

Debt, net of current portion

4,691.4

5,276.7

Deferred income tax liabilities

547.3

612.8

Other liabilities

418.9

350.3

Total liabilities

7,287.4

7,720.1

Stockholders’ equity:

Common stock including paid-in capital

3,924.5

3,830.1

Accumulated earnings

1,702.6

1,491.5

Accumulated other comprehensive loss

(73.9)

(69.0)

Total stockholders’ equity

5,553.2

5,252.6

Total liabilities and stockholders’ equity

$ 12,840.6

$ 12,972.7

Avantor, Inc. and subsidiaries

Unaudited condensed consolidated statements of cash flows

(in millions)

Three months ended
September 30,

Nine months ended
September 30,

2024

2023

2024

2023

Cash flows from operating activities:

Net income

$ 57.8

$ 108.4

$ 211.1

$ 222.6

Reconciling adjustments:

Depreciation and amortization

102.4

98.0

304.6

301.7

Impairment charges

—

160.8

Stock-based compensation expense

11.9

9.8

35.7

31.7

Non-cash restructuring charges

16.4

—

16.4

—

Provision for accounts receivable and inventory

16.3

19.4

55.8

62.5

Deferred income tax benefit

(22.6)

(29.4)

(75.3)

(94.1)

Amortization of deferred financing costs

2.8

3.2

8.6

9.9

Loss on extinguishment of debt

2.1

2.0

6.5

5.9

Foreign currency remeasurement (gain) loss

(0.1)

(3.0)

3.0

(3.1)

Changes in assets and liabilities:

Accounts receivable

34.2

47.2

34.2

55.1

Inventory

(7.3)

10.8

(21.5)

9.1

Accounts payable

(4.0)

(21.4)

41.9

(95.8)

Accrued interest

(16.2)

(9.7)

(16.5)

(10.3)

Other assets and liabilities

56.6

(4.2)

63.0

(38.5)

Other

(5.5)

(0.4)

—

0.9

Net cash provided by operating activities

244.8

230.7

667.5

618.4

Cash flows from investing activities:

Capital expenditures

(40.8)

(37.7)

(121.3)

(95.8)

Other

0.3

0.7

1.7

2.1

Net cash used in investing activities

(40.5)

(37.0)

(119.6)

(93.7)

Cash flows from financing activities:

Debt repayments

(214.3)

(197.6)

(585.0)

(657.9)

Payments of debt refinancing fees and premiums

—

(2.3)

Proceeds received from exercise of stock options

16.5

9.4

67.3

14.1

Shares repurchased to satisfy employee tax
obligations for vested stock-based awards

(0.8)

(0.2)

(8.2)

(13.5)

Net cash used in financing activities

(198.6)

(188.4)

(525.9)

(659.6)

Effect of currency rate changes on cash and cash equivalents

7.9

(5.4)

0.6

(1.3)

Net change in cash, cash equivalents and restricted cash

13.6

(0.1)

22.6

(136.2)

Cash, cash equivalents and restricted cash, beginning of period

296.7

260.8

287.7

396.9

Cash, cash equivalents and restricted cash, end of period

$ 310.3

$ 260.7

$ 310.3

$ 260.7

Avantor, Inc. and subsidiaries

Reconciliations of non-GAAP measures

Adjusted EBITDA and Adjusted EBITDA Margin

(dollars in millions, %
based on net sales)

Three months ended September 30,

Nine months ended September 30,

2024

2023

2024

2023

Net income

$ 57.8

3.4 %

$ 108.4

6.3 %

$ 211.1

4.1 %

$ 222.6

4.2 %

Amortization

75.4

4.3 %

75.4

4.4 %

225.6

4.4 %

232.7

4.4 %

Loss on extinguishment of debt

2.1

0.1 %

2.0

0.1 %

6.5

0.1 %

5.9

0.1 %

Integration-related expenses1

—

— %

0.2

— %

—

— %

8.3

0.2 %

Restructuring and severance charges2

49.4

2.9 %

6.1

0.4 %

82.3

1.7 %

18.0

0.3 %

Transformation expenses3

17.1

1.0 %

—

— %

46.6

0.9 %

—

— %

Reserve for certain legal matters4

7.9

0.5 %

3.0

0.1 %

7.9

0.2 %

4.0

0.1 %

Other5

0.4

— %

(0.4)

— %

(0.4)

— %

(2.2)

— %

Impairment charges6

—

— %

—

— %

—

— %

160.8

3.1 %

Income tax benefit
applicable to pretax
adjustments

(34.9)

(2.0) %

(23.1)

(1.3) %

(85.8)

(1.7) %

(96.7)

(1.8) %

Adjusted net income

175.2

10.2 %

171.6

10.0 %

493.8

9.7 %

553.4

10.6 %

Interest expense, net

48.7

2.8 %

72.4

4.2 %

173.9

3.4 %

219.5

4.2 %

Depreciation

27.0

1.6 %

22.6

1.4 %

79.0

1.5 %

69.0

1.3 %

Income tax provision
applicable to
Adjusted Net income

51.6

3.0 %

51.2

2.9 %

144.4

2.9 %

165.1

3.1 %

Adjusted EBITDA

$ 302.5

17.6 %

$ 317.8

18.5 %

$ 891.1

17.5 %

$ 1,007.0

19.2 %

____________________

Represents incremental expenses directly associated with the Company’s publicly-announced cost transformation initiative, primarily related to the cost of external advisors.

Represents charges and legal costs in connection with certain litigation and other contingencies that are unrelated to our core operations and not reflective of on-going business and operating results.Represents net foreign currency (gain) loss from financing activities and other stock-based compensation expense (benefit).Related to impairment of the Ritter asset group.

Avantor, Inc. and subsidiaries

Reconciliations of non-GAAP measures (continued)

Adjusted Operating Income and Adjusted Operating Income Margin

(dollars in millions, %
based on net sales)

Three months ended September 30,

Nine months ended September 30,

2024

2023

2024

2023

Net income

$ 57.8

3.4 %

$ 108.4

6.3 %

$ 211.1

4.1 %

$ 222.6

4.2 %

Interest expense, net

48.7

2.8 %

72.4

4.2 %

173.9

3.4 %

219.5

4.2 %

Income tax expense

16.7

1.0 %

28.1

1.6 %

58.6

1.2 %

68.4

1.3 %

Loss on extinguishment of debt

2.1

0.1 %

2.0

0.1 %

6.5

0.1 %

5.9

0.1 %

Other income, net

(0.7)

— %

(0.7)

— %

(3.4)

(0.1) %

(3.3)

— %

Operating income

124.6

7.3 %

210.2

12.2 %

446.7

8.7 %

513.1

9.8 %

Amortization

75.4

4.3 %

75.4

4.4 %

225.6

4.4 %

232.7

4.4 %

Integration-related expenses1

—

— %

0.2

— %

—

— %

8.3

0.2 %

Restructuring and severance charges2

49.4

2.9 %

6.1

0.4 %

82.3

1.7 %

18.0

0.3 %

Transformation expenses3

17.1

1.0 %

—

— %

46.6

0.9 %

—

— %

Reserve for certain legal matters4

7.9

0.5 %

3.0

0.1 %

7.9

0.2 %

4.0

0.1 %

Other5

0.4

— %

0.1

— %

1.4

— %

0.1

— %

Impairment charges6

—

— %

—

— %

—

— %

160.8

3.1 %

Adjusted Operating Income

$ 274.8

16.0 %

$ 295.0

17.1 %

$ 810.5

15.9 %

$ 937.0

17.9 %

_____________________

Represents direct costs incurred with third parties and the accrual of a long-term retention incentive to integrate acquired companies. These expenses represent incremental costs and are unrelated to normal operations of our business. Integration expenses are incurred over a pre-defined integration period specific to each acquisition.Reflects the incremental expenses incurred in the period related to restructuring initiatives to increase profitability and productivity. Costs included in this caption are specific to employee severance, site-related exit costs, and contract termination costs. The expenses recognized in 2024 represent costs incurred to achieve the Company’s publicly-announced cost transformation initiative.Represents incremental expenses directly associated with the Company’s publicly-announced cost transformation initiative, primarily related to the cost of external advisors.Represents charges and legal costs in connection with certain litigation and other contingencies that are unrelated to our core operations and not reflective of on-going business and operating results.Represents other stock-based compensation expense (benefit).Related to impairment of the Ritter asset group.

Avantor, Inc. and subsidiaries

Reconciliations of non-GAAP measures (continued)

Earnings per share

(shares in millions)

Three months ended
September 30,

Nine months ended
September 30,

2024

2023

2024

2023

Diluted earnings per share (GAAP)

$ 0.08

$ 0.16

$ 0.31

$ 0.33

Dilutive impact of convertible instruments

—

Fully diluted earnings per share (non-GAAP)

0.08

0.16

0.31

0.33

Amortization

0.11

0.33

0.34

Loss on extinguishment of debt

0.01

—

0.01

—

Integration-related expenses

—

0.01

Restructuring and severance charges

0.07

0.01

0.12

0.03

Transformation expenses

0.03

—

0.07

—

Reserve for certain legal matters

0.01

—

0.01

Other

—

Impairment charges

—

0.24

Income tax benefit applicable to pretax adjustments

(0.05)

(0.03)

(0.13)

(0.14)

Adjusted EPS (non-GAAP)

$ 0.26

$ 0.25

$ 0.72

$ 0.82

Weighted average shares outstanding:

Diluted (GAAP)

683.0

678.5

682.1

678.1

Incremental shares excluded for GAAP

—

Share count for Adjusted EPS (non-GAAP)

683.0

678.5

682.1

678.1

Free cash flow

(in millions)

Three months ended
September 30,

Nine months ended
September 30,

2024

2023

2024

2023

Net cash provided by operating activities

$ 244.8

$ 230.7

$ 667.5

$ 618.4

Capital expenditures

(40.8)

(37.7)

(121.3)

(95.8)

Free cash flow (non-GAAP)

$ 204.0

$ 193.0

$ 546.2

$ 522.6

Adjusted net leverage

(dollars in millions)

September 30,
2024

Total debt, gross1

$ 5,001.6

Less cash and cash equivalents

(285.3)

$ 4,716.3

Trailing twelve months Adjusted EBITDA

$ 1,193.2

Trailing twelve months ongoing stock-based compensation expense

43.9

$ 1,237.1

Adjusted net leverage (non-GAAP)

3.8 x

____________________

Includes $51.4 million of Finance lease liabilities attributed to Clinical Services business and classified as held for sale.

Avantor, Inc. and subsidiaries

Reconciliations of non-GAAP measures (continued)

Net sales by segment

(in millions)

September 30,

Reconciliation of net sales growth
(decline) to organic net sales growth
(decline)

Net sales
growth
(decline)

Foreign
currency
impact

Organic
net sales
growth
(decline)

2024

2023

Three months ended:

Laboratory Solutions

$ 1,171.5

$ 1,159.1

$ 12.4

$ 5.3

$ 7.1

Bioscience Production

542.9

561.1

(18.2)

1.9

(20.1)

Total

$ 1,714.4

$ 1,720.2

$ (5.8)

$ 7.2

$ (13.0)

Nine months ended:

Laboratory Solutions

$ 3,484.3

$ 3,555.9

$ (71.6)

$ 8.9

$ (80.5)

Bioscience Production

1,612.7

1,688.5

(75.8)

3.6

(79.4)

Total

$ 5,097.0

$ 5,244.4

$ (147.4)

$ 12.5

$ (159.9)

(dollars in millions, % based on net sales)

September 30,

Reconciliation of net sales growth
(decline) to organic net sales growth
(decline)

Net sales
growth
(decline)

Foreign
currency
impact

Organic
net sales
growth
(decline)

2024

2023

Three months ended:

Laboratory Solutions

$ 1,171.5

$ 1,159.1

1.1 %

0.5 %

0.6 %

Bioscience Production

542.9

561.1

(3.2) %

0.3 %

(3.5) %

Total

$ 1,714.4

$ 1,720.2

(0.3) %

0.4 %

(0.7) %

Nine months ended:

Laboratory Solutions

$ 3,484.3

$ 3,555.9

(2.0) %

0.3 %

(2.3) %

Bioscience Production

1,612.7

1,688.5

(4.5) %

0.2 %

(4.7) %

Total

$ 5,097.0

$ 5,244.4

(2.8) %

0.2 %

(3.0) %

Adjusted Operating Income by segment

(dollars in millions, %
represent Adjusted
Operating Income margin)

Three months ended September 30,

Nine months ended September 30,

2024

2023

2024

2023

Laboratory Solutions

$ 151.5

12.9 %

$ 159.1

13.7 %

$ 450.7

12.9 %

$ 511.0

14.4 %

Bioscience Production

138.1

25.4 %

148.2

26.4 %

409.0

25.4 %

469.9

27.8 %

Corporate

(14.8)

— %

(12.3)

— %

(49.2)

— %

(43.9)

— %

Total

$ 274.8

16.0 %

$ 295.0

17.1 %

$ 810.5

15.9 %

$ 937.0

17.9 %

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Technology

Autonomous Defense Technologies Set to Ignite a Nearly $200 Billion Global Market

Published

41 minutes ago

July 23, 2026

AI-Powered Military Drones, Autonomous Platforms, and Next-Generation Defense Systems Are Fueling One of the Fastest-Growing Opportunities in Aerospace and Defense

NEW YORK, July 23, 2026 /PRNewswire/ — Market News Updates News Commentary – Around the globe, the defense industry is quickly adopting autonomous technologies, with governments investing significantly in artificial intelligence, unmanned systems, advanced sensors, and self-directed decision-making capabilities. Military forces are on the lookout for technologies that can swiftly gather intelligence, function in dangerous settings without risking personnel, and respond promptly to threats. Unmanned aerial vehicles (UAVs) utilizing autonomous AI are increasingly crucial in modern military operations, proficient in various tasks such as reconnaissance, surveillance, target identification, electronic warfare, logistics support, and precision strike missions with minimal human intervention. As artificial intelligence advances, these sophisticated systems are expected to improve their efficiency in managing drone swarms, sharing battlefield information, and swiftly adjusting to changing combat situations. Companies leading the Autonomous and AI technology Defense Operations boom include: VisionWave Holdings Inc. (NASDAQ: VWAV), Kratos Defense & Security Solutions, Inc. (NASDAQ: KTOS), AeroVironment, Inc. (NASDAQ: AVAV), AEVEX Corp. (NYSE: AVEX), Sidus Space, Inc. (NASDAQ: SIDU).

There is also a rapid expansion in financial opportunities. Fortune Business Insights forecasts substantial growth in the global Autonomous Defense Platforms Market, with a projected increase from approximately US$69.77 billion in 2026 to US$198.87 billion by 2034, indicating a robust compound annual growth rate of 14.0%. Additionally, the firm anticipates a surge in the global Military Drone Market from US$22.49 billion in 2026 to US$52.31 billion by 2034, showing an 11.1% compound annual growth rate. With rising defense budgets and a focus on AI-enhanced military capabilities, companies specializing in autonomous aircraft, AI software, advanced sensors, cybersecurity platforms, navigation systems, and cutting-edge battlefield technologies are well positioned to capitalize on these expanding markets.

The widespread integration of autonomous AI UAVs is revolutionizing military strategies and operations. Instead of relying on individual aircraft, armed forces are increasingly deploying coordinated fleets of intelligent drones capable of monitoring vast areas, identifying targets, transmitting secure communications, and offering real-time situational awareness to ground troops. Advancements in machine learning, computer vision, edge computing, and secure battlefield networking are empowering these systems to autonomously process large amounts of data, thereby reducing the workload on operators and increasing mission success. As global tensions rise and defense modernization remains a top priority worldwide, autonomous defense technologies are expected to be one of the fastest-growing sectors in the military industry in the coming decade.

VisionWave (NASDAQ: VWAV) and Meteor Aerospace Leadership Advance Integration Planning for AI-Enabled Multi-Domain Defense Technologies Following Previously Announced Acquisition Agreement — VisionWave Holdings Inc. (“VisionWave” or the “Company”) a defense technology company developing advanced artificial intelligence, autonomous systems and next-generation security technologies, today announced that its executive leadership team has completed a strategic technology and integration working session with the leadership of Meteor Aerospace Ltd. in Israel following the Company’s previously announced acquisition agreement to acquire a controlling interest in Meteor Aerospace. Completion of the transaction remains subject to the closing conditions described below.

The executive meetings represent an important milestone in the transaction process as both companies continue advancing technical, operational and commercial integration planning while progressing toward satisfaction of the closing conditions described below.

During the visit, VisionWave executives conducted comprehensive reviews of Meteor Aerospace’s expanding portfolio of advanced defense technologies, including tactical and strategic unmanned aerial vehicles (UAVs), unmanned ground vehicles (UGVs), unmanned surface vessels (USVs), electronic warfare (EW) and SIGINT technologies, precision strike systems, C4ISR platforms and integrated sovereign defense architectures.

The working sessions included executive strategy meetings, engineering reviews, technology demonstrations, manufacturing assessments and product roadmap discussions focused on identifying opportunities to accelerate innovation, expand international commercialization and strengthen VisionWave’s multi-domain defense technology platform.

Meteor Aerospace presented video documentation of field tests and demonstrations of its products, including flights of the Impact-700 UAV at the Bar Yehuda airfield near the Dead Sea in Israel, that were done with the regulatory monitoring and approval of the Israeli Aviation Authority.

For operational security reasons, the meetings were conducted at a confidential location, and additional details regarding attendees and facilities are not being disclosed.

Douglas Davis, Executive Chairman and Chief Executive Officer of VisionWave Holdings, stated: “Visiting Meteor Aerospace and working directly alongside its leadership and engineering teams reinforced what we recognized when we entered into the acquisition agreement. Meteor has developed a highly differentiated portfolio of autonomous systems, electronic warfare technologies, and integrated battlefield capabilities supported by a team with decades of aerospace engineering experience. Seeing these technologies firsthand further strengthened our confidence in the strategic opportunity this transaction represents.”

Mr. Davis continued: “Our integration planning, in preparation for a potential closing, is well underway. By bringing together VisionWave’s expertise in artificial intelligence, advanced sensing and computational technologies with Meteor’s capabilities across autonomous platforms, C4ISR, precision defense technologies and sovereign defense architectures, we believe we are building a next-generation defense technology platform positioned to address rapidly growing global demand for integrated battlefield solutions, autonomous systems and national security modernization.”

Throughout the visit, executives from both organizations evaluated opportunities to align technology development, manufacturing capabilities, international business development initiatives and long-term product strategies as part of VisionWave’s integration planning process.

The meetings also provided both leadership teams with the opportunity to establish integration priorities across engineering, operations, commercialization and future product development while preparing for the successful completion of the proposed transaction.

As previously announced, completion of the acquisition remains subject to a number of conditions for VisionWave’s satisfactory completion of legal, financial, operational, technical, aerospace, cybersecurity, export control, intellectual property and commercial due diligence, receipt of any applicable regulatory approvals and satisfaction of other customary closing conditions. There can be no assurance that the closing conditions will be satisfied, or that the transaction will be completed on the anticipated timeline or at all. Continued… Read this full release and additional news for VWAV by visiting: https://www.vwav.inc/newsroom/

Why Investors Are Watching the UAV / Autonomous / AI Military Operations Industries:

Autonomous AI-powered UAVs becoming standard assets for ISR and combat support missionsRising global defense spending focused on artificial intelligence and autonomous warfareGrowing adoption of autonomous drone swarms and collaborative mission capabilitiesIncreased demand for real-time intelligence, surveillance, and reconnaissance (ISR)Continued advances in machine learning, computer vision, edge computing, and autonomous navigationExpansion of electronic warfare, cybersecurity, and secure battlefield communicationsDefense modernization programs accelerating across North America, Europe, and the Indo-PacificGrowing opportunities for companies developing next-generation autonomous defense platforms

Other recent developments in the autonomous, defense/military/UAV/drone industries of note include:

Kratos Defense & Security Solutions, Inc. (NASDAQ: KTOS), a technology company in the defense, national security and global markets, recently announced it has been awarded a sole-source, single award Indefinite Delivery/Indefinite Quantity (IDIQ) contract for approximately $156 million, by the U.S. Department of Energy’s National Nuclear Security Administration (NNSA) Office of Secure Transportation (OST), in support of Project Solar Shield.

Under this new contract award, Kratos will provide mobile Counter-Unmanned Aircraft System (C-UAS) platforms designed to support OST’s critical National Security mission. The Office of Secure Transportation is responsible for the safe and secure ground and air transportation of nuclear weapons, weapon components, and special nuclear materials, as well as other missions supporting U.S. national security.

AeroVironment, Inc. (“AV”) (NASDAQ: AVAV), a global leader in intelligent, multi-domain autonomous systems, recently announced it has been awarded a $117.3 million contract by the U.S. Army for its P550™ electric vertical take-off and landing (eVTOL) unmanned aerial system in support of the Army’s Long Range Reconnaissance program, advancing the Army’s push to field scalable, adaptable capabilities for modern warfare.

The award was issued under a Basic Ordering Agreement (BOA) through a competitive Call for Solutions (C4S) under the U.S. Army’s Unmanned Aircraft Systems (UAS) Marketplace initiative, a centralized digital platform designed to accelerate the procurement of vetted drone technologies.

AEVEX Corp. (NYSE: AVEX) recently announced it has been awarded a $17.5 million follow-on contract under its Global Solutions portfolio to continue delivering critical services in support of U.S. national security objectives.

The contract reinforces the company’s role in providing mission focused, data-driven services and solutions that help decision makers act with speed and confidence. AEVEX’s Global Solutions capabilities integrate technology and multi-domain expertise to transform complex data into actionable insight for time sensitive missions.

“Our teams are trusted to support some of the nation’s most important missions,” said Roger Wells, Chief Executive Officer at AEVEX. “This award reflects continued confidence in AEVEX to deliver the specialized expertise required to advance essential national security interests.”

Sidus Space, Inc. (NASDAQ: SIDU) (“Sidus” or the “Company”), an innovative space and defense technology company, recently announced that its next LizzieSat® has successfully completed vibration testing, a key environmental qualification milestone for SpaceX’s Transporter-18 rideshare mission from Vandenberg Space Force Base in California, currently scheduled for launch no earlier than October 2026.

Vibration testing simulates the intense mechanical loads a spacecraft experiences during launch and ascent. The testing was conducted at Element U.S. Space & Defense’s facility in Orlando, Florida, an accredited independent provider of product qualification and environmental testing services. Completing this testing is designed to confirm that the satellite’s structure, components, and integrated payloads can withstand the stresses of liftoff and remain fully operational on orbit, a critical step in clearing the spacecraft for final integration and shipment to the launch site.

DISCLAIMER: MarketNewsUpdates.com (MNU) is a third party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. MNU is NOT affiliated in any manner with any company mentioned herein. MNU and its affiliated companies are a news dissemination solutions provider and are NOT a registered broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security. MNU’S market updates, news alerts and corporate profiles are NOT a solicitation or recommendation to buy, sell or hold securities. The material in this release is intended to be strictly informational and is NEVER to be construed or interpreted as research material. All readers are strongly urged to perform research and due diligence on their own and consult a licensed financial professional before considering any level of investing in stocks. All material included herein is republished content and details which were previously disseminated by the companies mentioned in this release. MNU is not liable for any investment decisions by its readers or subscribers. Investors are cautioned that they may lose all or a portion of their investment when investing in stocks. This press release was distributed on behalf of VisionWave Holdings, Inc. For current services performed MNU was compensated forty nine hundred dollars for news coverage of the current press releases issued by VisionWave Holdings, Inc. by the Company. MNU HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and MNU undertakes no obligation to update such statements.

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Technology

atQor Earns Microsoft Frontier Partner Status for AI Delivery

Published

41 minutes ago

July 23, 2026

The recognition validates atQor’s ability to unite Cloud & AI Platforms, AI Business Solutions and Security for customers in financial services, manufacturing, retail, healthcare and public sector.

AHMEDABAD, India, MISSISSAUGA, ON and SANTA FE SPRINGS, Calif., July 23, 2026 /PRNewswire/ — atQor, a Microsoft-focused AI and data platform company, today announced it has achieved Microsoft Frontier Partner status, with its nomination led by Microsoft India and recognition extending across Canada, the United States and India.

atQor holds all six Microsoft Solutions Partner designations, the Support Services designation, Azure Expert MSP status, Microsoft Fabric Featured Partner recognition and ten Advanced Specializations.

“Our engineers do not wait for a mandate to use AI, they build with it every day, and that is what Microsoft recognized,” said Pushkaraj Kale, CEO of atQor India. “Earlier this year, our teams built and deployed more than two hundred production AI agents in a single seventy-two-hour engineering event, and twenty-five of those are now live on Microsoft Marketplace. This nomination was led by Microsoft India, and it reflects the discipline our customers see across every industry we serve.”

“The Frontier Partner designation recognizes organizations that are helping customers move beyond AI experimentation and into business transformation. atQor has consistently invested across Microsoft’s AI, data, cloud, and security stack while building the Go-To-Market and delivery capabilities required to create measurable customer outcomes. We are pleased to see atQor join this distinguished group of partners and look forward to their continued contribution to AI adoption across industries,” said Om Batra, Channel Partner Sales Leader, India and South Asia, Microsoft.

“The most successful AI partners are those that can bridge innovation with operational excellence. atQor has built competencies spanning Microsoft Fabric, Azure AI, Security, and Copilot while maintaining a strong focus on delivery quality and governance. Their Frontier Partner recognition reflects the technical maturity and execution capability needed to help customers scale AI with confidence,” said Sanjeev Sharma, Director Tech Sales and Partner CTO, India and South Asia, Microsoft.

For customers, the recognition means fewer handoffs: one firm carrying the work from the first Microsoft Fabric workshop through the AI agent in production, instead of a customer coordinating several vendors to get there. atQor applies this across financial services, manufacturing, retail, healthcare and public sector organizations in Canada, the United States and India, continuing the relationship through managed Azure operations once systems are live.

Pushkaraj and the India team led this global recognition, according to Kartik Shah, Founder of atQor, who said Canada and U.S. teams, led by Co-Founder and Global COO Greg Kachhadiya, already hold themselves to that same standard.

About atQor: atQor is a Microsoft-focused AI and data platform company that helps enterprises move AI from pilot to production. Founded in 2002, the company operates across Canada, the United States and India, and holds CSP Direct authorization including Azure Gov Cloud in US. atQor maintains ISO 9001, ISO 20000, ISO 27001 and ISO 22301 certifications. Learn more at atQor.com.

Media Contact: Ramanuj Zawar, 419311@email4pr.com. United States: +1-844-294-5383. Canada: +1-289-290-4490. India: +91-706-904-3269.

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Technology

Carrier Accelerates Intelligent Building Strategy with Acquisition of 75F

Published

41 minutes ago

July 23, 2026

Cloud-native building automation strengthens Carrier’s digital ecosystem to enable increasingly intelligent and autonomous buildings

PALM BEACH GARDENS, Fla., July 23, 2026 /PRNewswire/ — Carrier Global Corporation (NYSE: CARR), global leader in intelligent climate and energy solutions, today announced it has acquired 75F, a leading innovator in cloud-native, wireless, AI-enabled building automation systems. The acquisition strengthens Carrier’s intelligent building capabilities across applications — from complex applied systems and high-growth data centers to light commercial and retrofits.

“Buildings are becoming intelligent and autonomous systems that continuously learn, adapt and optimize performance,” said David Gitlin, Chairman & CEO, Carrier. “Through Carrier ClimaVision™, we have already seen firsthand the power of 75F’s cloud-native, AI-enabled platform. This acquisition accelerates our strategy to create increasingly autonomous and self-optimizing buildings by bringing together connected equipment, intelligent controls and digital solutions in a unified platform that simplifies deployment, connects building data and enables agentic AI.”

The combination of Carrier’s WebCTRL® building controls install base, Abound™ predictive analytics capability and the Nlyte® operational intelligence platform with 75F’s unified data layer and AI capabilities will create a differentiated end-to-end offering spanning equipment, controls, analytics and outcomes for buildings globally. Together, these integrated capabilities enable building operators to transition from traditional building management to fully autonomous operations that proactively identify maintenance opportunities, optimize energy consumption, intelligently manage assets and improve occupant comfort.

“75F was founded to fundamentally rethink building automation using cloud-native software, AI and wireless technologies,” said Deepinder Singh, founder and CEO, 75F. “Joining Carrier enables us to accelerate that vision on a global scale. Together, we can help make intelligent buildings simpler to deploy, easier to operate and more accessible to customers everywhere.”

75F’s platform combines wireless sensors, intuitive controls, cloud software and AI-enabled automation designed to reduce installation time and simplify commissioning while optimizing energy efficiency and indoor air quality. Carrier plans to integrate 75F’s generative and agentic AI as well as auto-commissioning capabilities into its large commercial platforms, including its Carrier QuantumLeap™ thermal management suite, improving deployment and real-time thermal performance for the rapidly growing data center market.

Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as external legal counsel to Carrier in connection with the transaction. Avisen Legal, PA acted as external legal counsel to 75F in connection with the transaction.

About Carrier
Carrier Global Corporation, global leader in intelligent climate and energy solutions, is committed to creating innovations that bring comfort, safety and sustainability to life. Through cutting-edge advancements in climate solutions such as temperature control, air quality and transportation, we improve lives, empower critical industries and ensure the safe transport of food, life-saving medicines and more. Since inventing modern air conditioning in 1902, we lead with purpose: enhancing the lives we live and the world we share. We continue to lead because of our world-class, inclusive workforce that puts the customer at the center of everything we do. For more information, visit carrier.com or follow Carrier on social media at @Carrier.

Carrier. For the World We Share.

Cautionary Statement
This communication contains statements which, to the extent they are not statements of historical or present fact, constitute “forward-looking statements” under the securities laws. These forward-looking statements are intended to provide management’s current expectations or plans for Carrier’s future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as “believe,” “expect,” “expectations,” “plans,” “strategy,” “prospects,” “estimate,” “project,” “target,” “anticipate,” “will,” “should,” “see,” “guidance,” “outlook,” “confident,” “scenario” and other words of similar meaning in connection with a discussion of future operating or financial performance. Forward-looking statements may include, among other things, statements relating to the acquisition of the 75F business, the integration of such business into Carrier’s existing operations, strategies or transactions of Carrier, Carrier’s plans with respect to its indebtedness and other statements that are not historical facts. All forward-looking statements involve risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For additional information on identifying factors that may cause actual results to vary materially from those stated in forward-looking statements, see Carrier’s reports on Forms 10-K, 10-Q and 8-K filed with or furnished to the U.S. Securities and Exchange Commission from time to time. Any forward-looking statement speaks only as of the date on which it is made, and Carrier assumes no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

CARR-IR

Contact:

Media Inquiries

Rob Six

561-281-2362

Robert.Six@Carrier.com

Investor Relations

Michael Rednor

561-365-2020

InvestorRelations@Carrier.com

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