A recent report from short-seller Culper Research on May 20, 2025, cast a shadow over Archer Aviation (NYSE: ACHR), triggering a downturn in the electric vertical takeoff and landing (eVTOL) aircraft developer's stock price.
However, Archer Aviation swiftly refuted the allegations, labeling them "baseless" and questioning the research firm's credibility. This development arrives at a dynamic time for Archer, a period marked by significant operational advancements and positive financial disclosures.
Rather than being derailed, the company is leaning on its fundamental progress, including a strong first-quarter 2025 earnings report, key international partnerships, and continued advancements in its aircraft program, to counter the short seller's narrative. For investors, this situation necessitates a careful examination of the claims versus the company's verifiable achievements and ongoing strategic execution.
Archer in the Crosshairs
Culper Research's May 20th report leveled serious accusations against Archer Aviation, primarily alleging that the company has "systematically misled, deceived, or outright lied" to investors concerning crucial milestones in the development and testing of its flagship Midnight eVTOL aircraft. The short-seller's thesis hinges on claims that Archer's portrayal of its progress towards near-term commercialization is not only premature but also "reckless."
Among the specific allegations detailed by Culper are contentions that Archer misrepresented the timeline for its aircraft assembly and ground testing, citing purported internal communications. The report also challenges the validity of Archer's June 2024 "transition flight," claiming it was not compliant with FAA definitions and was designed to unlock funding. It further asserts that Archer concealed significant design flaws and subsequent overhauls of the Midnight aircraft.
Additionally, Culper Research questioned the nature of high-profile promotional activities, such as CEO Adam Goldstein's appearance on "The Tonight Show" with Jimmy Fallon and the LA28 Olympics partnership, suggesting these were costly paid endorsements rather than organic recognitions of progress.
As a notable tactic accompanying their report, Culper Research publicly extended a $1 million wager to Jimmy Fallon, challenging him to take an FAA-compliant commercial flight in an Archer Midnight by July 2028. In response to these multifaceted allegations, Archer Aviation has firmly stated that Culper Research is "not a credible research institution" and that all claims made in the report are "baseless," attributing the timing of the report to the company's recent positive momentum.
Archer's Financial Health Stands Firm
Despite the controversy stirred by the report, Archer’s latest financial results paint a more stable and optimistic picture of the company’s trajectory. Archer Aviation's Q1 2025 earnings surpassed expectations with an earnings per share (EPS) of -$0.17 against a -$0.28 estimate, and its net loss significantly improved to $93.4 million. Their balance sheet strengthened with cash and equivalents reaching $1.03 billion, up from $834.5 million in Q4 2024, primarily due to financing.
Q1 operating expenses were $144.0 million, a planned increase for scaling. Archer projects a Q2 2025 adjusted EBITDA loss of $100–120 million, reflecting its ongoing investment in the eVTOL sector. Their strong liquidity, exceeding $1 billion, supports certification and commercialization plans.
Archer's Recent Operational Milestones
Archer Aviation is on track to generate initial revenue in 2025 with its "Launch Edition" program in the UAE. The first piloted Midnight aircraft is set for UAE delivery this summer, with commercial operations planned later this year with Abu Dhabi Aviation and Ethiopian Airlines. This is supported by recent GCAA design approval for Abu Dhabi’s first hybrid heliport and the appointment of Cristiano Tartaglione as COO for UAE operations.
Archer also announced a UK partnership with Anduril Industries UK, Skyports Drone Services, and AtkinsRéalis to test dual-use eVTOL cargo aircraft, expanding its potential beyond passenger transport into a key European market. Manufacturing of its first conforming Midnight aircraft began in Q1 2025 at its ARC facility, with a target to build up to 10 aircraft in 2025 for FAA certification and "Launch Edition" deployments. Archer continues its technology partnership with Palantir (NASDAQ: PLTR), plans for a New York City air taxi network with United Airlines, and is the Official Air Taxi Provider for the LA28 Games.
Archer's Path Through Scrutiny
[content-module:Forecast|NYSE: ACHR]While Archer Aviation is currently navigating the turbulence created by a short-seller report, the company's recent first-quarter 2025 financial results and a consistent stream of operational advancements provide a strong, fact-based counter-narrative. The cash position exceeding $1 billion, coupled with a narrower-than-expected net loss, underscores sound financial management.
Tangible progress in key launch markets like the UAE, the strategic expansion into new applications such as UK cargo operations, and the continued backing from major strategic partners provide the narrative of a company methodically executing its complex commercialization plan.
Ultimately, Archer Aviation’s long-term success will be dictated by its sustained ability to meet manufacturing targets, achieve full FAA Type Certification, and successfully deploy its Midnight aircraft in commercial service. For investors focused on these fundamental milestones, the current period of heightened scrutiny may offer an opportunity to assess the company's resilience and its progress in pioneering the future of urban air mobility.
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