Boresight (ASX:BST): Defence Drone Growth, US Expansion and the FY27 Outlook

Aditi Sarkar

15 September 2026 12:34 PM AEST

Boresight (ASX:BST): Defence Drone Growth, US Expansion and the FY27 Outlook

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Highlights

Boresight (ASX:BST) reported FY26 Revenue of A$6.38 million, up 46% from A$4.36 million in the prior year.
The company secured a repeat North American military order covering more than 340 BQ-400 target drones and associated equipment.
Boresight is expanding Manufacturing capacity at its Huntsville, Alabama facility, targeting production of more than 5,000 units annually.
FY27 is expected to remain an Investment phase as the company builds production capacity, develops products and expands into international defence markets.

Boresight (ASX:BST) manufactures aerial target drones designed for counter-unmanned aerial systems Training and testing. It operates in a specialised segment of the defence market where militaries require realistic airborne targets to test detection, tracking and interception systems.

The Canberra-based manufacturer listed on the ASX on 10 June 2026 and subsequently reported its first full-year result as a listed company while continuing to expand in North America. Rising revenue and repeat military orders provide evidence of commercial traction, although continued investment in manufacturing, research and market expansion means profitability remains an important consideration.

Latest Development

In an announcement released in early September 2026, Boresight (ASX:BST) reported a repeat order from an American military training organisation secured through reseller Mountain Horse Solutions LLC.

The order covers more than 340 BQ-400 swarming-capable target drones, multiple ground control stations and an operator training course.

The contract is valued at US$383,275, approximately A$532,000, with staged deliveries and payments extending through the end of the second quarter of FY27. Boresight described the contract as approximately three times the size of the customer's previous purchase and its largest single order from a North American military customer.

Chief Executive Justin Olde said the repeat order reflected the use of the company's target systems in delivering repeatable counter-drone training. Units are expected to be manufactured at Boresight's expanded Huntsville, Alabama facility, supporting locally produced Supply for US military customers.

Company Overview

Boresight (ASX:BST) supplies aerial target drones, mission-planning software and ground-control systems used for counter-unmanned aerial systems training and testing.

The BQ-400 quadrotor is its highest-volume product, with the company reporting that the 5,000th unit had been delivered and the 6,000th manufactured by August 2026.

Its wider product range includes the larger BQ-750 Block 2, the BF-100 fixed-wing target introduced during FY26 and the BS-350 surveillance platform, which is undergoing Australian Defence Force-funded upgrades.

Customers include the Australian Defence Force, US defence organisations and industry partners. The company operates from Australia, its Huntsville Facility in the United States and across European markets.

Financial and Operational Position

Boresight listed on the ASX on 10 June 2026 after raising A$8.0 million.

For the year ended 30 June 2026, Boresight (ASX:BST) reported revenue of A$6.38 million, up 46% from A$4.36 million in the prior year. Gross Profit reached A$3.15 million, while the company reported three-year compound revenue growth of approximately 81%.

The statutory loss after tax was A$6.66 million compared with A$718,267 a year earlier. The FY26 result included a non-cash share-based payment expense of A$3.60 million, while the operating loss excluding non-cash items was A$3.06 million.

Cash stood at A$7.88 million at 30 June 2026, with no debt. Net Assets were A$7.82 million and Working Capital totalled A$7.38 million. No dividends were declared.

The disclosed order book includes an 18-month US contract covering 600 BQ-400 drones and a 12-month Australian Defence Force supply contract, alongside deliveries associated with the Sovereign UAS Program and LAND 156.

What Investors May Watch Next

Manufacturing scale-up remains one of the key operational areas for Boresight (ASX:BST). Its 812-square-metre facility in Huntsville, Alabama, is targeting annual production capacity of more than 5,000 units.

Progress towards Defence Industry Security Program accreditation and further expansion into European markets are additional markers to monitor.

Management has indicated that FY27 will remain a year of strategic investment across manufacturing capacity, Research and Development and international market entry. As a result, investors may assess not only revenue growth but also the trajectory of operating losses as the company expands.

The ability to convert existing military relationships and its order pipeline into larger recurring contracts will be another important measure of progress.

Risks

Boresight (ASX:BST) remains an early-stage listed defence company and is currently loss-making, with continued investment required to expand manufacturing capacity and develop new products.

Revenue also depends partly on government and military procurement processes, where purchasing decisions and contract timing can be delayed or changed.

The company has a relatively short track record as an ASX-listed Business and remains exposed to export controls, foreign exchange movements, competitive pressure and the execution risks associated with international expansion.

Individual defence orders can also vary significantly in size and timing, which may create Volatility in revenue from period to period.

Conclusion

Boresight (ASX:BST) is building its position in the specialised counter-drone training market through rising revenue, repeat North American military orders and additional manufacturing capacity in the United States.

FY26 delivered 46% revenue growth, while the latest repeat order demonstrates continued Demand for the company's BQ-400 platform. At the same time, Boresight remains loss-making and is continuing to invest heavily in production capacity, product development and market expansion.

The key test through FY27 will be whether the expanded Huntsville operation and existing defence relationships can translate into larger and more consistent contracts while the company moves towards a more sustainable Earnings profile.

FAQs

Q: What does Boresight (ASX:BST) do?

A: Boresight develops aerial target drones and related systems used for counter-drone training and testing.

Q: What was Boresight's FY26 revenue?

A: Revenue reached A$6.38 million for the year ended 30 June 2026, up 46%.

Q: What is the BQ-400?

A: The BQ-400 is Boresight's swarming-capable quadrotor target drone used in counter-drone training.

Q: Where is Boresight expanding manufacturing?

A: The company is expanding production at its Huntsville, Alabama facility in the United States.

Q: What may investors watch in FY27?

A: Manufacturing scale-up, new defence contracts, international expansion and the trajectory of operating losses are key areas to monitor.

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