Red Cat Holdings Inc (NASDAQ:RCAT) shares are plunging ahead of its first‑quarter earnings report, scheduled for Thursday, May 7 after the close. Here’s what you should know.

Red Cat Holdings stock is taking a hit today. Why is RCAT stock dropping?

Wall Street expects a loss of $0.13 per share on $17.63 million in revenue, and the stock may be feeling pressure as traders brace for a sharp comedown from last quarter's explosive finish to 2025.

A Sharp Contrast With Last Quarter's Results

The weakness comes as investors compare tomorrow's expectations with the company's exceptionally strong fourth quarter. Red Cat reported $26.2 million in fourth-quarter revenue, a dramatic increase from the prior year and a 172% sequential jump. Full‑year 2025 revenue reached $40.7 million, up 161% from the previous year.

Strong Momentum Highlighted In Q4

Last quarter's update underscored how quickly the company was expanding. Red Cat secured new Black Widow drone orders from an Asia‑Pacific ally, expanded its manufacturing footprint to 254,000 square feet, and used its February ...