Airship AI Reports Fourth Quarter 2025 Financial Results
Rhea-AI Summary
Airship AI (NASDAQ:AISP) reported Q4 2025 net revenues of $6.5M, gross profit of $3.3M and gross margin of 51.2%, reflecting a 102% revenue increase and 169% margin increase versus prior-year Q4. Operating loss was $0.6M; other income included a $23.6M noncash gain. Cash and equivalents totaled $11.8M and backlog was $3.3M with a validated pipeline of approximately $173M.
Management expects continued margin improvement, cash-flow positivity before end of 2026, and further federal and commercial contract awards.
Positive
- Net revenue increased by 102% year-over-year
- Gross margin improved to 51.2%
- Validated sales pipeline of approximately $173M
- Management targets cash-flow positive operations before end of 2026
Negative
- Operating loss of $612,000 in Q4 2025
- Net cash used in operating activities of $3.5M in Q4 2025
- Accounts receivable increased by $5.2M in the quarter
Key Figures
Market Reality Check
Peers on Argus
AISP is up 0.41% while key AI/software peers show mixed moves (e.g., HPAI -3.75%, ZENA -1.07%, ARBE +1.83%, BKKT +1.41%). This points to a largely stock-specific reaction to the earnings release.
Previous Earnings,AI Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Nov 17 | Q3 2025 earnings | Positive | -11.1% | Reported Q3 2025 results with margin strength and non-cash-driven net income. |
| Aug 05 | Q2 2025 earnings | Positive | -13.0% | Q2 2025 results with higher margins and a robust ~$128M opportunity pipeline. |
| May 15 | Q1 2025 earnings | Positive | +11.9% | Q1 2025 results showing revenue growth, strong pipeline and non-cash-driven net income. |
| Mar 03 | FY 2024 results | Positive | -21.6% | Full-year 2024 report with 87% revenue growth and improved operating loss. |
| Nov 14 | Q3 2024 earnings | Positive | -22.9% | Q3 2024 results featuring 75% gross margin and strong year-to-date growth. |
Earnings and AI-tagged updates have often been followed by weak share performance, with most prior earnings releases seeing negative next-day moves despite growth narratives.
Over the past five earnings and AI-tagged updates from Nov 2024–Nov 2025, Airship AI highlighted rapid revenue growth, strong gross margins, and a growing validated pipeline (often around $128M–$135M). However, four of these five events saw negative 24-hour price reactions, including moves of -21.58% and -22.87% after upbeat full-year and quarterly reports. Today’s Q4 2025 release continues the focus on revenue growth, margins, and federal opportunities within this historically volatile reaction pattern.
Historical Comparison
Past earnings/AI releases for AISP averaged a -11.33% next-day move, often negative despite strong growth metrics. Today’s modest 0.41% uptick is relatively muted versus that pattern.
Earnings updates show continued revenue growth, evolving margins, and a consistently large federal and commercial opportunity pipeline through 2024–2025.
Regulatory & Risk Context
An effective S-3 resale registration filed on Oct 28, 2025 covers up to 2,702,702 warrant shares at $6.20. The company is not selling shares in that filing but could receive up to $16,756,752 in cash if all such warrants are exercised.
Market Pulse Summary
This announcement highlights stronger Q4 2025 performance, with net revenues of $6.5M, gross profit of $3.3M, and a 51.2% gross margin, alongside sizable non-cash other income of $23.6M. Management emphasized a validated pipeline and new federal and commercial awards. Historically, earnings releases have produced volatile price reactions, so investors may watch future quarters for trends in operating losses, cash usage, and conversion of backlog and pipeline into recognized revenue.
Key Terms
earnout liability financial
warrant liability financial
firm fixed price contracts financial
public warrants financial
idiq regulatory
AI-generated analysis. Not financial advice.
Fourth Quarter 2025 Net Revenues of
Net Revenue Increase of
Cash flow positive business operations for the quarter.
REDMOND, Wash., Feb. 17, 2026 (GLOBE NEWSWIRE) -- Airship AI Holdings, Inc. (NASDAQ: AISP) (“Airship AI” or the “Company”), a leader in AI-driven video, sensor, and data management surveillance solutions, today reported its financial and operational results for the fourth quarter ended December 31, 2025.
Q4 2025 Financial Highlights
- Net revenues for the quarter ended December 31, 2025, were
$6.5 million . - Gross profits for the quarter ended December 31, 2025, were
$3.3 million . - Gross margin percentage was
51.2% for the quarter ended December 31, 2025. Higher margins were in part due to increased solution sales with more Airship AI branded hardware and software offerings. - Operating loss was
$612,000 for the quarter ended December 31, 2025, reflected in increased stock-based compensation and increased investments in sales and marketing-related expenditures which should increase future sales. - Other income for the quarter ended December 31, 2025, was
$23.6 million , primarily due to a gain from a change in the fair value of earnout liability of$14.5 million and change in fair value of warrant liability of$9 million . - Net income for the year ended December 31, 2025, was
$29.3 million , or$0.90 per basic share, primarily related to noncash income of$36.5 million . - Net cash used in operating activities was
$3.5 million in the quarter ended December 31, 2025. This reflected a$5.2 million increase in accounts receivable. - Cash and cash equivalents was
$11.8 million as of December 31, 2025 and accounts receivable was$6.5 million .
Q4 2025 & Subsequent Operational Highlights
- Backlog as of December 31, 2025 was
$3.3 million , representing firm fixed price contracts awarded in the fourth quarter of 2025 that will be shipped and invoiced in the following quarter(s). Backlog is not indicative of future quarterly revenue as approximately75% of quarterly revenue is transactional and recognized in the same quarter. - Our total validated pipeline at the end of the quarter was approximately
$173 million , consisting of single and multi-year opportunities for AI-driven edge, video, and sensor and data management platform across all our customer verticals. Our pipeline includes opportunities at varying stages of progression with expected award timeframes throughout the next 18-24 months. - New significant contract awards during Q4 and into Q1 2026 include:
$1.9 million award from Department of Homeland Security (DHS) supporting large National Special Security Events scheduled for 2026.$2.8 million award from a large commercial customer supporting a technical refresh of deployed hardware and software.- Multiple awards at the DHS component agency level for critical infrastructure facilities to replace existing failing physical security solutions.
- Pilot opportunity for a DHS component agency level in-car vehicle recording system designed around officer and public safety.
- Through our expanding partner engagement activities, our pipeline substantially increased in both the commercial and federal sectors. Several opportunities added to the pipeline are enduring multi-year efforts that have the potential to expand Airship’s presence within the customer or agency significantly overtime, with long-term support contracts attached to them.
- Due to the sensitive nature of many of our customers and deployment use cases, we are often restricted from publicly disclosing awards and / or limited as to the specifics of the customer and use case. Consequently, most of our awards are executed on closed or restricted contract vehicles, which further limits the sharing of information that might otherwise be available.
2026 Outlook
- Capitalize on growing momentum coming out of Q4 into the new fiscal year around long-term business development efforts that are forecasted to be funded in 2026 through the One Big Beautiful Bill Act (OBBB).
- Maintain focus on improving gross margin percentages supporting our goal of cash flow positive operations before the end of 2026.
- Continue tactical and strategic investments across our sales and business development organizations through organic cash flow from business operations and the cash exercise of public warrants.
- Continue training and refinement of our edge (Outpost AI) and datacenter / cloud (Fortress) based analytic platforms supporting emerging edge analytic workflows.
- Continue innovation across our core Acropolis software platform supporting new workflows for cloud-based deployments in highly secure operational environments.
- Expand brand awareness engagements in new verticals through targeted marketing outreach opportunities, social media platforms, Airship AI hosted technology events, and industry tradeshow events.
Management Commentary
“The fourth quarter of 2025 saw positive contracting momentum with multiple agencies across the federal government,” said Paul Allen, President of Airship AI. “While fiscal appropriation processes put in place by the current administration have continued to slow down or impact some agencies ability to spend, those agencies engaged in mission critical activities around homeland security were able to move forward on several programs to solve for critical technology-based gaps in the quarter.
“Notable new procurement activities under OBBB included movement on the CBP 'Smart Wall' construction with
“Additionally, progress was made on transitioning pilot / non-programmatic efforts that Airship was engaged with to the programmatic level, in some cases including new authorities to operate on trusted federal government networks. We believe this progression cements Airship’s position as a trusted vendor for highly secure AI driven solutions supporting federal government mission critical requirements now and into the future.
"Our continued expansion into the partner / integrator space also added significantly to our pipeline, as we were exposed to multiple large projects supporting both federal and commercial customer opportunities, leveraging in part our existing footprint and trusted reputation as a solution provider. Being able to provide partners a turn-key market ready solution that is hardened and secure yet operator friendly is something that the market has been needing, one that operates as easily on-premises as it can in a datacenter or the cloud.
"Our AI offerings increased as we closed out the end of the year with our Agentic AI natural-language search tool called 'Ask Airship' being released to select customers, allowing them to easily interact with data created by our growing sets of computer vision models running at the edge on our existing Outpost AI appliance and now released datacenter / cloud server offering called Fortress.
“We expanded the use of our edge AI capabilities across additional sensor modalities and operational platforms, including mobile autonomous platforms, starting with bipedal and quadrupedal robots. We believe these platforms present the opportunity to reach a wider range of customers and solve a growing number of operational requirements as customers and agencies look to best leverage the efficiencies that robotic platforms offer when combined with AI at the edge.
“Entering into 2026 we are highly optimistic about the opportunities in our pipeline and the strength of our team to collectively execute against them. While 2026 budgets at the DHS level aren’t fully resolved yet, with the existing funding in place for contingency and mission critical requirements, the growing breadth of our pipeline helps hedge the risks of funding challenges at any specific agency or component level,” concluded Mr. Allen.
About Airship AI Holdings, Inc.
Founded in 2006, Airship AI (NASDAQ: AISP) is a U.S. owned and operated technology company headquartered in Redmond, Washington. Airship AI is an AI-driven video, sensor and data management surveillance platform that improves public safety and operational efficiency for public sector and commercial customers by providing predictive analysis of events before they occur and meaningful intelligence to decision makers. Airship AI’s product suite includes Outpost AI edge hardware and software offerings, Acropolis enterprise management software stack, and Command family of visualization tools.
For more information, visit https://airship.ai.
Forward-Looking Statements
The disclosure herein includes certain statements that are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “project,” “forecast,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters, but the absence of these words does not mean that a statement is not forward looking. These forward-looking statements include, but are not limited to, (1) statements regarding estimates and forecasts of financial, performance and operational metrics and projections of market opportunity; (2) changes in the market for Airship AI’s services and technology, expansion plans and opportunities; (3) the projected technological developments of Airship AI; and (4) current and future potential commercial and customer relationships. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Airship AI’s management and are not predictions of actual performance. These forward-looking statements are also subject to a number of risks and uncertainties, as set forth in the section entitled “Risk Factors” in its Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 17, 2026, and the other documents that the Company has filed, or will file, with the SEC. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. In addition, forward looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its assessments to change. However, while it may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.
Investor Contact:
Chris Tyson/Larry Holub
MZ North America
949-491-8235
AISP@mzgroup.us
| AIRSHIP AI HOLDINGS, INC. | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| As of December 31, 2025 and 2024 | ||||||||
| December 31, 2025 | December 31, 2024 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 11,750,021 | $ | 11,414,830 | ||||
| Accounts receivable, net of allowance for credit losses of | 6,462,675 | 1,226,757 | ||||||
| Prepaid expenses and other | 294,191 | 17,883 | ||||||
| Total current assets | 18,506,887 | 12,659,470 | ||||||
| OTHER ASSETS | ||||||||
| Other assets | 160,528 | 165,960 | ||||||
| Operating lease right of use asset | 807,915 | 882,024 | ||||||
| TOTAL ASSETS | $ | 19,475,330 | $ | 13,707,454 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Accounts payable - trade | $ | 1,149,811 | $ | 759,480 | ||||
| Advances from founders | - | 1,300,000 | ||||||
| Accrued expenses | 27,966 | 51,649 | ||||||
| Current portion of operating lease liability | 438,635 | 305,178 | ||||||
| Deferred revenue- current portion | 4,668,105 | 3,238,483 | ||||||
| Total current liabilities | 6,284,517 | 5,654,790 | ||||||
| NON-CURRENT LIABILITIES: | ||||||||
| Operating lease liability, net of current portion | 425,109 | 638,525 | ||||||
| Warrant liability | 13,328,006 | 34,180,618 | ||||||
| Earnout liability | 2,620,933 | 23,304,808 | ||||||
| Deferred revenue- non-current | 3,966,407 | 2,951,850 | ||||||
| Total liabilities | 26,624,972 | 66,730,591 | ||||||
| COMMITMENTS AND CONTINGENCIES (Note 9) | ||||||||
| STOCKHOLDERS' DEFICIT: | ||||||||
| Preferred stock - no par value, 5,000,000 shares authorized, 0 shares issued and outstanding as of December 31, 2025 and 2024 | - | - | ||||||
| Common stock - | 3,434 | 3,056 | ||||||
| Additional paid in capital | 38,478,030 | 21,918,867 | ||||||
| Accumulated deficit | (45,620,227 | ) | (74,941,590 | ) | ||||
| Accumulated other comprehensive loss | (10,879 | ) | (3,470 | ) | ||||
| Total stockholders' deficit | (7,149,642 | ) | (53,023,137 | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ | 19,475,330 | $ | 13,707,454 | ||||
| AIRSHIP AI HOLDINGS, INC. | ||||||||
| CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | ||||||||
| For the years ended December 31, 2025 and 2024 | ||||||||
| Year Ended | Year Ended | |||||||
| December 31, 2025 | December 31, 2024 | |||||||
| NET REVENUES: | ||||||||
| Product | $ | 10,135,562 | $ | 18,716,196 | ||||
| Post contract support | 5,099,756 | 4,334,017 | ||||||
| Other services | 86,031 | - | ||||||
| 15,321,349 | 23,050,213 | |||||||
| COST OF NET REVENUES: | ||||||||
| Cost of Sales | 6,178,868 | 10,843,766 | ||||||
| Post contract support | 1,372,604 | 1,679,692 | ||||||
| Other services | 72,111 | - | ||||||
| 7,623,583 | 12,523,458 | |||||||
| GROSS PROFIT | 7,697,766 | 10,526,755 | ||||||
| RESEARCH AND DEVELOPMENT EXPENSES | 3,076,466 | 2,804,894 | ||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 11,837,086 | 11,226,974 | ||||||
| TOTAL OPERATING EXPENSES | 14,913,552 | 14,031,868 | ||||||
| OPERATING LOSS | (7,215,786 | ) | (3,505,113 | ) | ||||
| OTHER INCOME (EXPENSE) : | ||||||||
| Gain (loss) from change in fair value of earnout liability | 15,401,751 | (18,171,380 | ) | |||||
| Gain (loss) from change in fair value of warrant liability | 20,852,612 | (33,512,633 | ) | |||||
| Loss from change in fair value of convertible debt | - | (141,636 | ) | |||||
| Loss on note conversion | - | (1,144,676 | ) | |||||
| Interest income (expense), net | 282,786 | (1,003,096 | ) | |||||
| Other income | - | 13,644 | ||||||
| Total other income (expense), net | 36,537,149 | (53,959,777 | ) | |||||
| INCOME (LOSS) BEFORE PROVISON FOR INCOME TAXES | 29,321,363 | (57,464,890 | ) | |||||
| Provision for income taxes | - | - | ||||||
| NET INCOME (LOSS) | 29,321,363 | (57,464,890 | ) | |||||
| OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||
| Foreign currency (loss) income, net | (7,409 | ) | 9,338 | |||||
| TOTAL COMPREHENSIVE INCOME (LOSS) | $ | 29,313,954 | $ | (57,455,552 | ) | |||
| NET INCOME (LOSS) PER SHARE: | ||||||||
| Basic | $ | 0.90 | $ | (2.34 | ) | |||
| Diluted | $ | 0.76 | $ | (2.34 | ) | |||
| Weighted average shares of common stock outstanding | ||||||||
| Basic | 32,413,133 | 24,585,955 | ||||||
| Diluted | 38,681,401 | 24,585,955 | ||||||
| AIRSHIP AI HOLDINGS, INC. | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| For the years ended December 31, 2025 and 2024 | ||||||||
| Year Ended | Year Ended | |||||||
| December 31, 2025 | December 31, 2024 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income (loss) | $ | 29,321,363 | $ | (57,464,890 | ) | |||
| Adjustments to reconcile net income (loss) to net cash used in operating activities | ||||||||
| Depreciation and amortization | - | 1,861 | ||||||
| Stock-based compensation | 1,629,992 | 1,362,822 | ||||||
| Amortization of operating lease right of use asset | 378,448 | 222,780 | ||||||
| Issuance of common stock for services | - | 198,500 | ||||||
| Noncash interest expense | - | 1,008,419 | ||||||
| (Gain) loss from change in fair value of warrant liability | (20,852,612 | ) | 33,512,633 | |||||
| (Gain) loss from change in fair value of earnout liability | (15,401,751 | ) | 18,171,380 | |||||
| Loss from change in fair value of convertible note | - | 141,636 | ||||||
| Loss on note conversion | - | 1,144,676 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (5,235,918 | ) | 422,147 | |||||
| Prepaid expenses and other | (276,308 | ) | 485 | |||||
| Other assets | 5,432 | 16,373 | ||||||
| Operating lease liability | (384,298 | ) | (174,875 | ) | ||||
| Payroll and income tax receivable | - | 7,230 | ||||||
| Accounts payable - trade and accrued expenses | 366,649 | (2,294,698 | ) | |||||
| Deferred revenue | 2,444,179 | (2,780,447 | ) | |||||
| NET CASH USED IN OPERATING ACTIVITIES | (8,004,824 | ) | (6,503,968 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Issuance of common stock and warrants for offering, net | - | 7,290,000 | ||||||
| Proceeds from warrant exercise, net | 9,498,136 | 7,704,540 | ||||||
| Repayment of advances from founders | (1,300,000 | ) | - | |||||
| Advances from founders | - | (450,000 | ) | |||||
| Proceeds from stock option exercises | 149,288 | 240,507 | ||||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | 8,347,424 | 14,785,047 | ||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 342,600 | 8,281,079 | ||||||
| Effect from exchange rate on cash | (7,409 | ) | 9,338 | |||||
| CASH AND CASH EQUIVALENTS, beginning of period | 11,414,830 | 3,124,413 | ||||||
| CASH AND CASH EQUIVALENTS, end of period | $ | 11,750,021 | $ | 11,414,830 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Interest paid | $ | - | $ | 11,913 | ||||
| Taxes paid | $ | - | $ | 2,410 | ||||
| Noncash investing and financing | ||||||||
| Issuance of common stock for debt interest payment | $ | - | $ | 1,008,442 | ||||
| Issuance of common stock for debt conversion | $ | - | $ | 4,114,831 | ||||
| Issuance of common stock for earnout shares | $ | 5,282,125 | $ | - | ||||
| Recognition of operating right-of-use asset | $ | 304,339 | $ | - | ||||
| Recognition of operating lease liability | $ | 304,339 | $ | - | ||||
FAQ
What were Airship AI (AISP) Q4 2025 revenues and margins?
How did Airship AI (AISP) record net income for full-year 2025?
What is Airship AI’s (AISP) cash and operating cash flow position at Dec 31, 2025?
How large is Airship AI’s (AISP) contract pipeline and backlog entering 2026?
What notable federal awards did Airship AI (AISP) announce in Q4 2025 and Q1 2026?
What guidance did Airship AI (AISP) give about 2026 operational priorities?
