EVE Air Mobility (SPNS) Q2 2025: $14B Backlog Anchors 2027 Service Entry, Prototype Flight Nears

2025-08-13 | By EarningsIQ Research

EVE Air Mobility’s Q2 2025 showcased a pivotal transition from concept to execution, as the company secured its first firm order and expanded its pre-order backlog to nearly $14 billion. Prototype testing is accelerating, with initial flights targeted by year-end and certification milestones on track for 2027. The company’s disciplined cash management and robust supplier partnerships position it to weather the capital-intensive ramp, but execution risk remains high as it enters the critical flight test phase.

Summary

• Backlog Converts to Cash: First firm order triggers pre-delivery payments, supporting funding runway.
• Prototype Progress: Full-scale engineering prototype set for initial flight by year-end, with Beta propulsion partnership adding design flexibility.
• Capital Discipline: Expense optimization and standby facilities extend liquidity through mid-2027, but program milestones remain gating factors.

Performance Analysis

EVE Air Mobility, a pre-revenue electric vertical takeoff and landing (eVTOL) developer, continues to operate at a loss as it invests heavily in R&D and program development. The company spent $55 million on development initiatives in the quarter, including its eVTOL aircraft, aftermarket services suite (“TechCare”), and Vector, its urban air traffic management (UATM) software. Net loss for Q2 reached $64 million, reflecting both R&D intensity and non-cash warrant revaluation charges linked to share price appreciation.

Operating cash consumption nearly doubled sequentially to $57 million, primarily due to the timing of supplier payments and accelerated engineering activity. However, management emphasized that the first-half cash burn of $83 million is a normalized run rate, and full-year spend is expected at the low end of the $200 to $250 million guidance range. Liquidity remains solid at $242 million in cash, supplemented by undrawn credit lines and a $50 million grant, bringing total available liquidity to $375 million.

• Backlog Expansion: Pre-order book climbs to 2,800 aircraft, with $14 billion in nominal value, spanning 28 customers across nine countries.
• Aftermarket Traction: 14 customers signed for TechCare services, covering 1,100 aircraft and potentially yielding $1.6 billion in future revenue.
• Supplier Diversification: Beta’s propulsion system joins Nidec, providing redundancy and faster testing cycles for the prototype program.

With initial pre-delivery payments (PDPs) now flowing from its first firm order, EVE is beginning to unlock working capital to support assembly and future ramp. The company’s capital structure and cash discipline are critical as it approaches the high-burn certification and flight test phase.

Executive Commentary

Strategic Positioning

1. Backlog Quality and Conversion

EVE’s strategy centers on building a diverse, global backlog, now at 2,800 aircraft, primarily via non-binding letters of intent (LOIs). The conversion of the first LOI to a firm order with REVO, a leading Sao Paulo helicopter operator, is a critical milestone, as it initiates pre-delivery payments and validates the commercial appeal of EVE’s product and service bundle. Management signaled that further backlog conversion will be selective, prioritizing strategic partners and operational readiness over volume.

2. Prototype and Certification Progression

The full-scale engineering prototype is entering its final ground test phase, with initial flight targeted for late 2025. The company is executing a dual-motor supplier strategy, testing both Nidec and Beta propulsion systems to optimize for safety, reliability, and certification risk. The flight test campaign will proceed in building-block fashion, focusing first on hover performance—a key technical hurdle for urban eVTOLs—before transitioning to cruise and system integration. Five conforming prototypes are planned for the certification campaign, with learnings from engineering prototypes flowing into final design.

3. Ecosystem and Aftermarket Development

TechCare, EVE’s aftermarket service and support suite, is gaining traction, with 14 customers signed covering 40% of the pre-order book. The company is also advancing its Vector UATM software, positioning itself as a holistic solution provider for urban air mobility (UAM). Management is actively building partnerships in infrastructure and energy to address the operational ecosystem required for large-scale eVTOL deployment, a differentiator as the industry moves toward commercialization.

4. Capital Efficiency and Funding Optionality

Leveraging Embraer’s engineering resources enables EVE to optimize R&D spend and avoid duplicative costs, a key advantage relative to peers. The company’s cash runway extends through at least mid-2027, supported by credit facilities, grants, and disciplined expense management. Management is evaluating multiple funding options for the final certification push, including shelf registration, long-term loans, and strategic partnerships, with timing to be dictated by milestone progress and market conditions.

Key Considerations

EVE’s Q2 marks a transition from program concept to tangible execution, but the path to certification and commercialization remains complex and capital-intensive. Investors must weigh the strength of the backlog and supplier partnerships against the inherent uncertainties of first-flight and regulatory approval.

Key Considerations:

• Order Book Conversion: The shift from LOIs to firm orders is essential for de-risking revenue projections and validating customer demand.
• Prototype Flight Risk: Successful initial flights and smooth transition to certification prototypes are gating factors for 2027 service entry.
• Supplier Redundancy: Dual-motor supplier strategy reduces technical risk but increases integration complexity.
• Aftermarket Penetration: TechCare’s attach rate will influence long-term margin structure and customer stickiness.
• Capital Markets Access: Liquidity is sufficient for near-term milestones, but additional funding will be required for certification and ramp.

Risks

Execution risk is elevated as EVE enters the flight test phase, with any delays or technical setbacks potentially impacting certification timelines and capital needs. The heavy reliance on non-binding LOIs creates uncertainty around actual delivery conversion. Competitive dynamics are intensifying, especially as incumbents like Joby deepen integration with operators and ride-sharing platforms. Regulatory clarity and urban airspace integration remain unresolved, posing additional long-term risk.

Forward Outlook

For Q3 and Q4 2025, EVE expects:

• Initial engineering prototype flight by year-end
• Continued backlog conversion efforts and additional LOI signings as warranted

For full-year 2025, management maintained guidance:

• Cash consumption of $200 to $250 million, likely trending toward the low end

Management emphasized:

• Milestone-driven spend, with cost optimization via Embraer partnership
• Certification campaign to begin following publication of compliance means by year-end

Takeaways

EVE’s Q2 2025 sets the stage for a critical execution window, as the company moves from design and backlog building to prototype validation and regulatory engagement. The ability to translate LOIs into firm orders and successfully navigate the flight test campaign will determine the durability of the $14 billion backlog and the path to 2027 service entry.

• Execution Milestones: Investors should monitor prototype flight progress and milestone conversion as key de-risking events for the business.
• Backlog Quality: The transition from non-binding LOIs to binding contracts will be a litmus test for market adoption and revenue visibility.
• Funding Flexibility: Capital structure and access to additional funding will shape EVE’s ability to deliver on certification and ramp objectives.

Conclusion

EVE Air Mobility’s Q2 2025 was defined by tangible progress in both commercial and technical arenas, with the first firm order and prototype readiness marking a shift toward execution risk. While the company’s backlog and capital discipline are strengths, near-term focus must remain on flight test outcomes, LOI conversion, and prudent capital deployment as the industry approaches a commercialization inflection point.

Industry Read-Through

The quarter underscores rising momentum across the eVTOL sector, with multiple OEMs advancing flight test campaigns and deepening operator partnerships. EVE’s emphasis on supplier redundancy and ecosystem development signals a broader industry trend toward risk mitigation and integrated solutions. The move by incumbents like Joby to vertically integrate with ride-sharing platforms points to intensifying competition for first-mover advantage and route access. For investors, the ability to convert order pipelines into binding commitments and to demonstrate prototype reliability will be the primary differentiators as the market evolves from hype to hardware.

SPNS Industrials Aerospace Urban Air Mobility eVTOL Backlog Certification Prototype