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How to invest in the Trump 2.0 era? Drones may become one of the winners, these companies are essential to know.
After the market closed on Thursday, U.S. Secretary of Defense Peter Hegerus issued a new order to accelerate the production and deployment of drones. Notably, in early June, Trump signed several executive orders aimed at enhancing the capabilities of the U.S. in areas related to drones.
This news also stimulated the drone Concept to rise collectively, $Red Cat Holdings(RCAT.US)$ up nearly 13% in pre-market, $Unusual Machines(UMAC.US)$ rising over 7%, $AIRO Group(AIRO.US)$ rising over 5%.
In fact, with advancements in Technology and a surge in demand, drones have become an indispensable technology in military, commercial, and civilian sectors. From Trump's 2026 budget plan, Pentagon defense spending has reached $962 billion, occupying a core position, highlighting the strength of Trump's investment in armaments. The drone Industry is expected to benefit from this.
According to Statistics from Market.us, the commercial drone market has grown at a compound annual growth rate of nearly 30% in recent years, and it is expected to reach a market size of $125.9 billion by 2033. Additionally, according to a report from Statista, North America is the primary hub for commercial drones, accounting for about 40% of the global market, while Europe is the second-largest commercial drone market, accounting for about 30% market share.
Previously《Hidden Winners in the U.S. Election! The Trump 2.0 Era is Coming, and U.S. Drone Concept Stocks are Expected to Experience a Surge?》、《Trump Targets the Drone Industry! U.S. Related Concept Stocks are Hotly Discussed, Who Will Be the Biggest Winner?》、《Geopolitical Conflicts Catalyze + Trump Policy Support! Drone Manufacturer AeroVironment Surged 140% on the First Day of Listing, How High Can This Industry Fly?》 Multiple articles have previously warned that U.S. drone concept stocks are expected to surge in the Trump 2.0 era.
This issue mainly introduces military drones, as follows:
AIRO Group is a technology differentiated and diversified company focused on aerospace and defense opportunities in the 21st century. Through decades of industry experience and extensive networks in the drone, aviation, and avionics markets, the company provides leading solutions for the global market. The company went public on June 13 and has seen a cumulative rise of over 120% since then.
According to the prospectus, the company operates in four sectors: drones, avionics, training, and electric aerial mobility. The combined potential market size for these four sectors is expected to exceed $315.4 billion by 2030.
Airo's main revenue comes from drone-related businesses, and the company has deployed equipment in NATO and EU countries, participating in practical tests in the Ukraine conflict. Their drones possess AI capabilities and can perform tasks such as reconnaissance, target identification, and strike guidance, and are very difficult to shoot down due to their artificial intelligence features.
In addition, the company plans to produce military drones domestically in the United States and aims to obtain Department of Defense certification within six months to enter the Pentagon procurement system.
Airo Chairman Kathuria stated:
Modern warfare has been completely transformed by drones. While a peaceful resolution between Iran and Israel is desired, such tensions may actually increase market investment interest in the Aerospace and Defense Sector.
$Kratos Defense & Security Solutions(KTOS.US)$
Kratos Defense & Security Solutions was established in 1994, primarily providing key products, services, and solutions for National Security to the U.S. government. Its technological advantages include Satellite communication systems, Electronic warfare, unmanned control systems, and cybersecurity, providing information technology products and wireless communication systems to the U.S. Department of Defense, Department of Homeland Security, and various industrial clients. The company has risen over 75% this year.
The company operates in six sectors: Unmanned Systems, Microwave Electronics, Space & Training and Cybersecurity, Defense and Rocket Support Services, Turbine Technology, and C5ISR Systems.
Kratos has significant deployments in the unmanned systems field, covering Unmanned Aerial Systems (UAS), Unmanned Ground Systems (UGS), and Unmanned Surface Vehicles (USV). These systems have wide applications in military, intelligence, and National Security fields.
Unmanned Aerial Systems (UAS): Includes high-performance drones with reconnaissance, surveillance, strike, and training capabilities.
Unmanned Ground Systems (UGS): Unmanned vehicles used for ground combat or support missions, such as Ukraine has begun to extensively utilize unmanned combat vehicles in recent years to support various tasks like mine clearance, reconnaissance, ammunition delivery, and suppressing enemy infantry.
Unmanned Surface Vehicles (USV): Unmanned boats suitable for tasks such as maritime reconnaissance and surveillance, commonly known as ghost fleets.
AeroVironment is a leading global provider of military and commercial unmanned aircraft systems (UAS), focusing on small drones and tactical missile systems. It is the main supplier of small drone systems (UAS) for the U.S. military and its allies, known for systems like the Switchblade loitering munition and the Puma reconnaissance drone. The company typically holds solid government and military contracts and has seen over a 50% increase this year.
The company gained fame during the Russia-Ukraine conflict in 2022 when its products were quickly adopted by NATO. Its offerings include small drones, ground robotics, and support services such as training and maintenance.
Notably, since May 2025, after AeroVironment completed a major acquisition of BlueHalo, the company has reorganized its business structure, now operating two divisions: Autonomous Systems and Space, Cyber and Directed Energy.
– The Autonomous Systems division includes: unmanned aerial systems, defense systems, unmanned ground and maritime systems, loitering munitions systems, and MacCready Works.
Among them, MacCready Works is AeroVironment's innovation and research department, focusing on the integration of autonomy, AI, and advanced platform technologies to provide next-generation operational capabilities.
The Space, Cyber, and Directed Energy Sector includes: space technology, directed energy solutions, cyber solutions, and mission services.
Northrop Grumman is one of the largest weapon and military technology manufacturers in the United States, focusing on military aircraft, space and defense technology, responsible for producing most of the bombers in the U.S. and supplying fighter aircraft components to other companies. In addition to being a leader in stealth technology for American Airlines, it also plays a vital role in some space projects. It has increased by more than 10% this year.
Northrop Grumman is one of the leaders in drone technology. Its famous RQ-4 "Global Hawk" drone is the world's most advanced high-altitude long-endurance unmanned reconnaissance aircraft, widely used for military reconnaissance and information collection. The company also developed the X-47B unmanned combat aircraft, which is a drone capable of taking off from aircraft carriers, representing the future trend of drone technology.
Red Cat Holdings is a company focused on military and commercial drones, and its subsidiaries Teal Drones and FlightWave Aerospace provide a diverse range of drone hardware and software solutions.
Despite Red Cat's poor performance this year, recording a 47% decline, the company anticipates a rise of up to 13 times in 2024. Last year, the company successfully collaborated with Palantir to integrate AI-driven visual navigation technology (VNav) into drones.
The company's most eye-catching product is their core product — Black Widow. This small unmanned surveillance and reconnaissance system won the U.S. Army's short-range reconnaissance project contract.
It is worth noting that the drone Industry where Red Cat operates is rapidly evolving, especially in military and government applications. The industry shows great market potential due to technological innovation and growing global demand, particularly for military uses such as reconnaissance, surveillance, and precision strikes.
The U.S. Army's recent short-range reconnaissance (SRR) project is an important opportunity driving the demand for drones. Red Cat's Black Widow drone emerged victorious in this project, bringing in order demand.
Additionally, $Palladyne AI(PDYN.US)$ focusing on developing advanced artificial intelligence technology, with core capabilities including machine learning-driven data analysis and deep expertise in natural language processing (NLP) and computer vision. Their technology can be widely applied in scenarios such as object detection, image classification, and Medical image analysis. With a close partnership with Red Cat, the company indirectly participates in government unmanned vehicle military contracts, becoming a key technology partner in the supply chain.
Additionally, Palladyne AI recently obtained a contract from the Air Force Research Laboratory to migrate Palladyne Pilot to a new generation of American-made AI chipsets, with plans to commence in early 2025.
