Kratos raised its full-year 2026 revenue guidance to $1.7-1.76bn and opened negotiations on a Valkyrie low-rate initial production contract, targeting 40 aircraft per year by early 20281. Kratos is a US drone manufacturer; the Valkyrie is its unmanned tactical aircraft, designed to fly alongside crewed fighters as expendable mass.
The move builds on the company's first-quarter beat, which set the basis for both the upgraded outlook and the production talks. Low-rate initial production is the step where a programme transitions from prototype builds to a repeatable manufacturing line, the gate that determines whether Valkyrie reaches squadrons at scale or stalls at demonstrator volumes.
The 40-a-year target is modest against the hundreds of thousands of cheap attack drones the Pentagon is buying elsewhere, but it sits at the opposite end of the market: a larger, reusable airframe rather than a one-way munition. Kratos raising guidance while opening the production conversation points to firming demand for that higher-end tier alongside the attritable-mass push.
