Florida Co. Drone Piloting Product Approved by Defense Innovation Unit

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Florida drone components company Unusual Machines Inc. (UMAC:NYSEAMERICAN) announced that its Fat Shark Video Transmitter (VTX) is its latest product to be approved by the Defense Innovation Unit (DIU) for inclusion in the Blue UAS Framework. The component is a compact, analog video transmitter. Its admission into the Blue UAS Framework means it has been cybersecurity tested and approved for use in Unmanned Aerial Systems technology for the Department of Defense, which created the Defense Innovation Unit in 2015 to streamline the U.S. military's adoption and use of cutting-edge commercial technologies. The VTX joins a growing list of core first-person view (FPV) drone components produced by UMAC listed in the Framework.

"This milestone reflects our continued focus on building secure, trusted components for FPV drones that align with NDAA requirements," said UMAC CEO Allan Evans, who holds a PhD in Electrical Engineering. As defense procurement continues to shift toward secure, cost-effective solutions, we are positioned to meet the growing demand, at scale and with trusted supply chain integrity. With this latest addition to the Blue Framework, we are proud that we can now offer complete NDAA-compliant configurations."

The VTX offers a unique position in the Framework, offering analog video transmission, which is well suited to the new combat paradigm of manufacturing low-cost drones capable of transmitting low-latency video at great distances.

Domestic Market for Drone Manufacturing Strong

Amidst tariffs and national security concerns regarding the political alignment of international supply chains, U.S.-based tech manufacturing initiatives are in a strong position. However, the U.S. lags behind China in production, especially in the manufacture of smaller electronic units, such as lightweight drones. A July DoD Procurement directive, a slew of grant programs, the National Defense Authorization Act, and Executive Order "Unleashing American Drone Dominance" seek to change that, as investment flows into the drone industry.

On July 11, the Pentagon reclassified drones weighing under 55 pounds as "consumables," which cuts red tape on NATO requirements intended for more expensive, aircraft-like UAVs. In the case of these munition-like drones, simply being assembled from components on the Blue Framework ensures compliance with regulation, as opposed to vetting each individual unit. Additionally, now even lower-ranking military service members can now buy drones with their credit cards, as they would ammunition. "Small UAS are such critical force enablers that they must be prioritized at the same level as major weapons systems," states the memo's attachment, which emphasizes fast-tracking UAV development, testing, and production.

Drones are excellent hardware to pair with advancements in artificial intelligence, as indicated by a US$12M AI in drone market projected to hit US$51M by 2033, with a CAGR of 17.9%. While hardware constituted 46.2% of this market in 2024, significant growth is expected in the software segment, as AI-coordinated flight allows for lightweight drones to assume complex formations in combat, mimicking the swarms of social insects and birds. North America led the AI in the drone market in 2024, with a 35.5% revenue share, with a projected CAGR of 13.5% through 2030 in the drone market overall.

Companies with compliance adherence and manufacturing capabilities are poised to benefit.

Catalysts for Unusual Machines

UMAC has signed a lease on a 17,000 sq. ft motor manufacturing facility in Orlando, FL, with production scheduled for September 2025. Additionally, they have acquired Australian company Rotor Lab for US$7M, a lightweight, drone focused motor manufacturing company, in order to have an international as well as in-house source of motors.

Furthermore, Rotor Lab is linked to a popular hobbyist YouTube channel, which bodes well as small drones, once an amateur and recreational pursuit, become picked up by commercial industries.

They target a fundamental position in the drone supply chain: B2B hardware sales, focused currently on FPV components crucial for remote piloting of commercial unmanned aerial vehicles (UAVs), with a focus on defense. They seek to build out sales and manufacturing capacity and develop and provide Blue Framework components, which excludes products associated with the Chinese Communist Party through Shenzhen company DJI, per the "Countering CCP Drones Act."

Analyst Barry Sine Makes "Intel Inside" Comparison, UMAC a Buy

Barry M. Sine (CFA, CMT) of Litchfield Research characterized UMAC as the Intel Inside of drones — supplying US$300 worth of components for a US$500 unit. "As with Intel during the PC boom, UMAC's upside lies in being embedded in many of the units sold," he wrote. He anticipates the rest of 2025 to be highly impactful, as this summer spree of policy changes moves the needle on U.S. drone production further than previously expected budget cycles.

Success hinges on UMAC's ability to successfully develop, market, sell, and scale. Litchfield Hills values UMAC at twice that of its industry peers, assuming it can maintain long-term growth. Sine rates UMAC as a Buy, with a US$20 price target.

Ownership and Share Structure

About 11.1% of the company is owned by management and insiders, UMAC said. The rest, 88.9%, is retail.

Unusual Machines has 24.83.1 million common shares. Its market cap is US$288.03 million. Its 52-week high and low share prices are US$23.62 and US$1.28 per share, respectively.