Archer Aviation Inc. (ACHR) shares experienced a significant decline, falling nearly 10% in premarket trading on Friday, November 7, 2025. This downturn followed the company's third-quarter earnings release, which was accompanied by major strategic announcements. The electric vertical takeoff and landing (eVTOL) aircraft developer reported a wider-than-expected quarterly loss, a development that overshadowed substantial new funding and a significant acquisition of a Los Angeles airport.
The stock's performance on Friday contrasted with management's characterization of the quarter's events as transformative for the company's air taxi ambitions. Investor sentiment appeared to be primarily influenced by concerns over the company's increasing losses and its considerable capital deployment.
Earnings Miss and Accelerating Cash Burn
Archer Aviation's third-quarter 2025 financial results highlighted deteriorating performance, contributing to the premarket sell-off. The company reported total operating expenses amounting to $174.8 million, leading to a net loss of $129.9 million. This figure represents an increase from the $115.3 million net loss recorded in the same quarter of the previous year.
The company's adjusted EBITDA also widened, moving to negative $116.1 million from negative $93.5 million a year prior. This indicates an acceleration in the company's cash burn rate as it continues to advance its flight testing and commercialization efforts. Archer's cash balances saw a reduction of $82.7 million during the quarter, primarily attributed to operating and investing activities.
Despite the widening losses, Archer maintained a robust liquidity position, reporting $1.64 billion in cash, cash equivalents, and short-term investments by the end of the quarter. For the fourth quarter, the company provided guidance projecting adjusted EBITDA losses to be between $110 million and $140 million, signaling a continued substantial consumption of capital.
While Archer achieved notable technical milestones during the third quarter, including a 55-mile flight and reaching an altitude of 10,000 feet with its Midnight aircraft, investors appeared to prioritize the company's financial trajectory over its operational advancements.
Strategic Airport Acquisition and Capital Infusion
In conjunction with its earnings announcement, Archer revealed its intention to acquire control of Hawthorne Airport in Los Angeles for $126 million in cash. This historic airport, established in the 1920s and also known as Jack Northrop Field, occupies an 80-acre site with approximately 190,000 square feet of facilities. Its location is less than three miles from Los Angeles International Airport (LAX).
Archer plans to repurpose this location into a central operational hub for its planned Los Angeles air taxi network. The facility is also slated to support services for the LA28 Olympic Games and serve as a testbed for advanced AI-powered aviation technologies, including air traffic and ground operations management systems.
To finance its expansion initiatives, Archer successfully raised $650 million in new equity capital. This capital infusion boosted the company's total liquidity to over $2 billion, reinforcing what the company describes as a sector-leading balance sheet. The capital raise was managed by Moelis & Company and Cantor Fitzgerald and is intended to provide sufficient runway for ongoing development and commercialization activities.
Furthermore, Archer completed its acquisition of Lilium's patent portfolio, which comprises approximately 300 advanced air mobility assets, for €18 million. This acquisition significantly expands Archer's intellectual property holdings, bringing its total to over 1,000 global assets. However, the combination of increasing losses and substantial capital expenditure for the airport acquisition appears to have overshadowed these strategic moves in the immediate assessment by investors.