Good morning. My name is Ellie, and I will be your conference operator today. I would like to welcome everyone to Vertical Aerospace's 2025 First Half Year Earnings Call. Now I'd like to turn the call over to Gillian Levine, IR Lead at Vertical Aerospace. You may now begin your conference.

Hello, everyone, and good morning. I'm delighted to welcome you to our H1 update call today. Before we get started, I would like to remind you that during today's call, we'll be making forward-looking statements. These statements involve risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward-looking statements. Any forward-looking statements we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. We posted an accompanying slide deck to our Investor Relations web section of our website at investors.verticalaerospace.com, which contains information and cautionary warnings on forward-looking statements. For a more complete discussion about these risks and uncertainties, we have filed our 2025 first half year financial statements with the SEC this morning. Please now let me hand it over to our CEO, Stuart Simpson.

Good morning, everyone, and thank you for joining us today for Vertical Aerospace's 2025 Half Year Results. I will provide an update on our progress over the past six months, and I'm joined by our Chief Commercial and Strategy Officer, Michael Cervenka, to discuss one of our key partnerships. Before we begin, I would like to share something special with you. This video shows that this is just another day for flight testing. 2025 has been a pivotal year for Vertical so far, and I’m pleased to report that we are performing strongly against our strategic objectives. Looking at the targets we set last November for 2025, we have successfully achieved or remain on track to meet each of these milestones. We have conducted full-scale piloted wing-borne flights through public airspace, the first of its kind in Europe. Recently, we showcased a real-world use case with full-scale piloted airport-to-airport flight, among the world’s first for eVTOLs, at the largest military air show globally. Once we complete our wing-borne flight test, we are scheduled to achieve the final flight phase, piloted transition, before the end of the year. We also plan to finalize the assembly of our third and final VX4 prototype and fly it by year’s end, effectively doubling our flight test capacity. Following that, we aim to start flying this final prototype in hybrid-electric mode in 2026. These piloted transition and hybrid flights in the upcoming quarters will showcase our capabilities as a leading aerospace company with the expertise needed for certification. So far this year, we have begun production of our pre-production aircraft with long-range parts procurement, maintaining strong momentum with key partners such as Honeywell and, as of yesterday, Aciturri Aerostructures, with which I will share more details shortly. We have expanded our partnership with Bristow to expedite global eVTOL adoption through a ready-to-fly model that lowers entry barriers, a topic Michael will address later. We are on track to obtain expanded design organization approval from the U.K. CAA, including flight privileges that will allow us to issue our own permits to fly, eliminating the oversight required for each flight phase to date, which will be a significant endorsement from our regulator of Vertical's growth as a mature aerospace company. Lastly, we have enhanced our operating model and adjusted our approach to focus on execution, which includes making considerable improvements to our management team and Board. I will cover each of these milestones today, but I want to start by highlighting what I believe to be one of our biggest differentiators: our battery. Our advanced battery is fundamental to both our eVTOL and hybrid aircraft, and its performance is crucial for the success of VX4. This year, we are pleased to report that we completed essential full-scale build and testing of the battery concept design, including a substantial drop test of a 15.2 meter battery pack that parallels fuel tank testing in traditional rotorcraft. Additionally, we conducted a full-scale thermal runaway propagation test on a VX4 subpack, demonstrating that safe flight and landing are feasible even in the event of a battery fire. This positions us well to deliver our battery in compliance with EASA's SC VTOL standards. We are continually refining our battery to maximize lightness and power and are preparing to produce this certification-ready battery. Our battery not only sets our aircraft apart, but as indicated when we launched Flightpath 2030, it also opens up a unique business opportunity for Vertical in the medium and long term. The VX4 can only be powered by Vertical's proprietary batteries, meaning our customers will need to return to us for annual or more frequent battery replacements, depending on aircraft usage. This razor/razor-blade model results in a long-term, high-margin recurring revenue opportunity for Vertical, estimated to be 40% and above, and we expect it to ultimately lead to a balanced revenue mix between aircraft and battery sales. Our pilot line is being established at the Vertical Energy Center, but we plan to build a gigafactory to meet the demand for the batteries we need to produce. We are engaged in discussions with various potential sites and intend to make an announcement within the next 12 months. We are also exploring other uses for our advanced battery technology and hope to provide an announcement on this in the next 6 to 9 months. However, our main focus remains on delivering our pilot battery line and selecting a gigafactory location. We look forward to updating the market on the development of our battery and the status of our major facilities. Regarding our key milestones this year, one of our most notable accomplishments has been our full-scale piloted wing-borne flights. We submitted over 20,000 documents to obtain our permit to fly from the U.K. Civil Aviation Authority to begin this flight phase, marking our first time conducting piloted flights through public airspace. Unlike other areas, our flight test center in the Cotswolds is located above urban life, with people, schools, and homes nearby. The CAA's approval for our flight test signifies a joint acceptance of liability for the VX4 prototype aircraft. The regulatory scrutiny surrounding just our prototype aircraft is exceptionally stringent compared to other markets, which benefits us in the medium term and minimizes risks on our path to certification. We’ve dedicated years and extensive effort to walking the CAA through the VX4’s design, engineering, and capabilities. Therefore, when we progress to our pre-production aircraft in 2026, our regulator will already have a thorough understanding of our aircraft and its operations. The CAA has engaged in a mini-certification of our prototype for flight tests, which we aim to conclude, targeting piloted transition by year's end. This all supports the CAA's familiarity with how to certify our aircraft. Recently, we have conducted more wing-borne flight tests to integrate real-world insights into our pre-production aircraft. The benefits of our AI strategy are also becoming apparent through improved analysis of flight test data and our ability to manage large volumes of it more efficiently. I am excited to say that over the past six months, we have welcomed Paul Stone, who brings over 20 years of experience as a test pilot, including service in the Royal Navy and flying over 200 different aircraft. Paul also piloted VX4 in July, enabling us to achieve days where we conducted multiple piloted test flights in a single day with different pilots, significantly enhancing our learning. Building on our flight test success, we felt confident enough in our aircraft to perform the world’s first eVTOL airport-to-airport flight. Thousands witnessed the VX4 travel from Cotswold Airport to the Royal International Air Tattoo, the largest military airshow at RAF Fairford, a Royal Air Force base also used by the U.S. Air Force. This airport-to-airport flight will be a crucial use case for eVTOLs, and it was remarkable to see the public's reaction to the VX4 up close. At the airshow, VX4 was showcased alongside aircraft from over 20 European, Middle Eastern, and North American militaries, attracting around 250,000 visitors. Feedback was overwhelmingly positive from regulators, military partners, and the public, as they were able to grasp the future of air mobility through our inaugural demonstration flight. The market opportunity in defense is substantial, and the European defense technology market is expanding, driven by increased European defense spending. NATO members are raising their defense budgets from about 2% to 5% of GDP, resulting in an increase from $300 billion to around $1 trillion over the next 7 to 10 years. Vertical is uniquely positioned as the only European eVTOL contender to seize this opportunity. During the airshow, significant attention focused on the VX4's defense capabilities, particularly our advanced hybrid program, now incorporating a second-generation powertrain. We have developed and successfully tested the control algorithms linking our batteries, power generation system, and EPUs. We are currently working on building out the team, with Eric Samson, a long-standing member of the Vertical leadership team with extensive experience, particularly from Gulfstream involving five separate engineering and certification programs, including the G650, being appointed VP Program Hybrid. As stated, our target for piloted hybrid flight tests is set for 2026. I would like to remind you that our aircraft can accommodate our hybrid powertrain without significant modifications. We will use the existing VX4 eVTOL aircraft, remove half the batteries, and fit a gas turbine, extending the range to 1,000 miles or 1,600 kilometers and allowing a payload of 1,200 kilos or over 3,600 pounds. Our foresight in designing the aircraft for versatility allows us to repurpose our existing design rather than creating a new one. This strategic decision was made years ago to ensure our airframe and cabin capacity were industry-leading. Uniquely among this type of aircraft, the VX4 can comfortably fit four business passengers or six economy-style passengers in standard helicopter seating, along with ample luggage capacity, including one check-in and one carry-on bag, as well as one rucksack, up to 70 pounds per person. All this is achieved with the same airframe and a partition between passengers and the pilot, enhancing safety and security for passengers. We can deliver a best-in-class eVTOL aircraft thanks to the strength of our global Tier 1 aerospace supply chain. We are now committing to long-lead procurement with our key suppliers, securing both reliability and competitive pricing for critical components. Yesterday, we announced a long-term partnership with Aciturri Aerostructures to provide the airframe for the VX4 eVTOL and hybrid aircraft, including its wing, empennage, pylons, and fuselage for both pre-production and certified VX4 models that will enter service. Aciturri has nearly 50 years of experience in commercial aircraft programs, including major components for Airbus, Boeing, and Embraer, as well as developing airframes for eVTOLs. We are excited about combining our engineering team’s expertise with Aciturri's strong reputation for high-quality aerospace manufacturing. This partnership builds on our collaboration with Honeywell, which we expanded earlier this year to include flight control and aircraft management systems for our production aircraft through 2035. Through this enhanced partnership, Honeywell will assist Vertical in certifying some of the critical systems on the VX4, including its Anthem flight deck. We anticipate further updates regarding our airframe, composites, and other vital aspects of the VX4 in the coming weeks and months as we continue to strengthen our supply chain. By committing now to supplying the VX4 pre-production and entry-into-service aircraft, our partners are showing their strong alignment with our long-term production and certification plans. These partners clearly understand the scale of what we are building and are investing alongside us. Just to remind you, all of this supports the assembly of our first pre-production aircraft in December 2026. Now, I would like to pass it over to our Chief Commercial Officer, Michael Cervenka, to delve into more details about our recent partnership with Bristow.

Thanks, Stuart. Our partners support Vertical every step of the way. Vertical is developing, building, and selling the leading eVTOL in the sector, and we are backed by the industry's leading preorder book of blue-chip names such as American Airlines, Avalon, and Japan Airlines. This quarter, we deepened our commercial relationship with Bristow, by revenue, the world's largest helicopter operator. I've had the privilege of working closely with Bristow over many years, and I am continually impressed by the expertise, pragmatism, thoughtful vision, and leadership of Dave Stepanek and his team. Bristow has over 75 years of unrivaled experience in vertical lift, leading the way with an absolute focus on safety. It has been the first of type operator for many brand-new helicopters and operates in 18 countries across 6 continents with all the prerequisite air operator certificates, Part 145 and 147 maintenance and maintenance training approvals. Bristow already has over 900 pilots and a similar number of engineers. Not only did Bristow double its preorder from 50 to 100 aircraft, but we have developed a strategic partnership to accelerate global eVTOL adoption by combining Vertical's category-leading aircraft with Bristow's vertical lift operational and safety track record and experience. We are developing a scalable capital-light eVTOL operations platform for those seeking to operate the VX4. This partnership will offer, to Vertical's current and prospective customers, a ready-to-fly model, providing turnkey aircraft and operation solutions, including trained pilots, maintenance, and insurance. We will be able to provide a fully integrated solution to launch services without our customers building operational infrastructure from scratch, allowing them to focus on passenger experience, sales, and network integration. This is a first for the eVTOL industry, which we believe will lower the barriers to entry for future customers. This operating model is a key and well-established part of aviation already, for example, across the regional airline industry. Standing up all the elements needed for customers to benefit from eVTOLs is a marathon, not a sprint. But this joint offering from Vertical and Bristow will allow VX4 customers to focus on customer experience, ticket sales, and network integration while Bristow and Vertical jointly manage aircraft operations on their behalf. This is about making eVTOL operations simpler and ensuring that by 2030, the VX4 is the international eVTOL of choice. Please let me hand back to Stuart.

Thank you, Michael. In addition to the progress we've made with strategic Tier 1 suppliers and partners, we have also continued to strengthen our leadership, both on the leadership team and the Board. Starting with our leadership team. As we announced last month, we have expanded our leadership team with the appointment of Mark Higson as COO. In keeping with our aerospace heritage, Mark was trained as an aerospace engineer and brings 4 decades of leading complex global organizations to Vertical. He began his career at BA and more recently served as an adviser to McKinsey and Advent portfolio companies. Mark's strong operational expertise has become increasingly valuable as he has worked to drive the engineering team forward. Alongside Mark, Steve Vellacott has joined as VP of Airworthiness and Head of our Design Organization. Steve spent 3 decades at Leonardo Helicopters working closely with IATA on certifying rotorcraft and brings incredible certification experience as we accelerate towards our stated certification date. In the executive team alone, not including the wider company, our team has been involved in certifying dozens of aircraft and propulsion systems. What we know deeply is how to certify, which is why we are confident in our target certification date of 2028. Further supporting Vertical is our recently bolstered Board of Directors, and Lord Andrew Parker is our latest appointment, formerly Director General of MI5; and Lord Chamberlain, Head of the Royal Household. Lord Parker has unparalleled access and insights into U.K. government as well as having substantial experience on the Board of one of the U.K.'s largest defense companies. He has already offered strong guidance as we consider the first locations for our manufacturing facilities. And looking ahead, his deep understanding of government contracts and national security needs will prove invaluable as we strengthen our hybrid strategy and defense offering. Earlier this year, we also appointed Kris Haber, JK Brown, and Carsten Stendevad, who are proving great unlocks to new sources of capital. These appointments are already adding value as we enter the critical prerecertification phase, resulting in improved technical insight, additional capital market access, and finally, unparalleled knowledge and routes into the U.K., European, and global defense markets. We are confident in our clearly defined route to certification underpinning Flightpath 2030 due to our momentum and progress to date, but also due to our improved capital position. In July, we launched a successful follow-on raise, raising a gross total of approximately $70 million, taking the total raised in 2025 to nearly $160 million. This most recent raise included strong participation from both existing and new investors, and it gives us operational agility while strengthening our position as the leading eVTOL OEM for capital efficiency. Our current capital position enables us to complete our 2025 flight test campaign, including piloted transition flight, complete the build of our third prototype aircraft, or final prototype aircraft, which will double our flight testing capability. This aircraft, as I've already said, will be flown both eVTOL and then hybrid; begin the assembly of our next aircraft, our pre-production or certification aircraft; and continue to expand our certification aircraft supply chain, a critical step in accelerating our path towards commercialization at scale. Our guidance for this year remains unchanged with $110 million to $125 million net cash used in operating activities, and our cash runway takes us into the middle of 2026, with our cash and cash equivalents as of today approximately $139 million. To sum up, our capital efficiency for leading flight test progress is unparalleled. We have the strongest partners in supply chain, blue-chip customer backing, and the largest, most scalable aircraft in the sector, uniquely being certified to the highest levels of safety in aviation. And as we have explained, our leading large airframe is being built by Tier 1 Aciturri and accommodates our hybrid variant also. We are building toward a future where electric flight is real, safe, and scalable. We're not just checking boxes. We are delivering against a clear roadmap with team, technology, and partnerships that are second to none. Our momentum is strong, and I remain confident in our ability to certify the VX4 by our stated timeline. To provide more details on our progress and what we will accomplish over the coming months and years to bring the VX4 to market in 2028 and what comes beyond, we will be hosting a Capital Markets event in person in New York on the 17th of September. Please stay tuned for further details on this in the coming days. Thank you for your continued support. We look forward to seeing you in New York next month. With that, I'll hand it over to our operator for Q&A.

Your first question comes from the line of Edison Yu of Deutsche Bank.

I wanted to follow up on the comments you made about defense. Obviously, the macro trends are very favorable in Europe. Can you give us a flavor of what kind of missions or use cases that you're in discussions about taking part in?

Yes, of course. Edison, thanks for the question. As you say, the macro trends are really incredible. I think this has been one of the successes of the Trump presidency, getting NATO in Europe to put their hands in their pockets and increase defense spending over the next 7 years from around $300 billion to $1 trillion. I mean, that's a staggering, staggering amount of money and an incredible achievement given the background against which people have been asking for this for many, many years. In terms of the missions, as you can imagine, the military are extraordinarily excited by the capability of the aircraft. Silent takeoff and landing with no noise signature and effectively no heat signature is phenomenal in terms of what that kind of opens up. Then with the hybrid being able to turn that on and fly a range of up to 1,000 miles, 1,600 kilometers with a payload of 1,200 kilos or about 2,700 pounds, you open up whether it's logistics, moving; we can get 8 full-size Marines plus all their kit in the aircraft. I don't think anyone else comes close to that level of capability. So I think the missions are innumerable. It's an incredible opportunity. And I'd just remind you, we flew this aircraft in front of the most influential military people in the world when we flew into and out of the largest military air show in the world recently. So we are front and center for this. We're in a great position to take advantage of it.

Got it. And then switching gears just to the rest of the year. Obviously, you've got quite a few things, quite a few streams going on in the next 6 to 9 months. How are you feeling about the full transition, pilot full transition in the second half? What do you think are the biggest hurdles, if any, to achieving that?

Great. We've been clear, and I've been clear since I launched Flightpath 2030 that we'd be doing full transition in Q4 this year. We are still absolutely on track for that. The engineering is going brilliantly. At the minute, what we have is a huge truck with a big pylon on it that's driving up and down the runway at high speed, with our tilt actuators on the front, covered in sensors, producing huge amounts of data that we take back compared to our model and then we prove that our model of our aircraft is correct, and we provide that to our regulator. And just to bring this really into sharp focus, we have done everything bar maybe a 20- to 30-second period on the transition and then the slowdown to landing. What I mean by that is we've taken off vertically. We've flown around up to 30 knots. We've also flown horizontally like a conventional aircraft and slowed down to 70 knots just above stall speed. We're only proving out what happens in this period between 30 knots and 70 knots when you're flying on the wing. That's the bit of data we're gathering. We provide it to the regulator, and then we'll be up and running and flying. And I see that as a huge unlock because that has proved the concept of our aircraft. We have done everything with it then, full transition has done that. We are literally then into the shrink wrap and specification of the product. And as you know, we're building our first certification aircraft that will be ready for testing by the end of next year. So hopefully, that makes sense, Edison.

Yes, it sounds like. And last one for me. You mentioned the Investor Day coming up. Can you give us maybe a tease about what kind of topics you may address? Will you be updating some of the financials that you had previously disclosed? Any color there would be great.

Yes, of course. And this has been a remarkable 12 months for us. If you look back to putting out Flightpath 2030 for the first time, I think we're still the only company in this space that has really put out precise financial figures through this year, 2028, 2030, and beyond. So much has changed that we felt it was worth coming back and updating the market on those, specifically on the hybrid opportunity in terms of volumes, revenues, and margins, but also expanding a little bit about batteries. I think people are still struggling to understand how that plays in. And to remind everyone, batteries will be over 50% of our revenue about 5 to 7 years after entering service at a 40% margin. That's a phenomenal business model to have the razor/razor-blade model. So we will bring some more details around that. We will also be very transparent on the cost of certification. I've been saying this for the past year. We will talk about it in Q4 this year. So we will be doing that. We'll be talking about the sources of funding and the uses of them as we drive through certification. We'll also provide some detail around our manufacturing plans. And I'm really pleased to say we'll have a couple of keynote speakers, one of which will be Lord Parker, who will be talking around what is the geopolitical environment, particularly around the defense opportunity for us.

The next question comes from the line of Savi Syth of Raymond James.

If I may, you mentioned that the next aircraft could either be in preproduction or conforming for certification, while you also indicated that you are building a certification conforming aircraft next year which will be ready for testing by the end of next year. I'm just wondering if I misunderstood that and where you currently stand on completing the TDR and CDR, as well as the factors influencing your decision on what to build next after Aircraft 3.

Yes, of course. So just to confirm, Savi, you're absolutely right. So first, thanks for the question. Aircraft 3 is an exact copy of Aircraft 2. We'll fly it electric, decommission, put hybrid in, and will be flying as a hybrid next year. The aircraft we build after that will be our first certification compliant aircraft. We'll have locked in the supply chain. It will reflect the certification aircraft. So this, we don't have nonconforming/conforming. We have built out our prototype. We've proved the concept. We'll do full piloted transition. We'll double our engineering learnings from it with Aircraft 3. The next one we build, December next year, will be our first certification-ready aircraft that we then will be flying and proving that out with the regulator. But remember, we start from a point where we've already proved the concept of the aircraft works because of all the regulatory involvement we've had over the past 3 years. So this, I'm so excited to get to December next year because that will be the first aircraft and people will really be able to see how this looks. Huge next 18 months.

Looking forward to that. If I might also, just on the long-term parts purchases, between what you've announced so far, just how much of the bill of materials has been secured to date? And then I was curious if there are any nonrecurring engineering costs associated with this? Or is that something your partners will cover, and when that might come if they don't cover it?

Yes, of course. So today, just to remind you, we've signed a $1 billion deal with Honeywell for everything the pilot sees, feels, touches, and all the software behind how the aircraft is controlled. So that's a huge amount, and it's difficult to say what proportion. But if you think of what that means, we have put the foundations in for the aircraft locked in with a company that knows how to certify. The next contract we announced with Aciturri is effectively all of the physical aircraft. So those are the 2 major bits of the aircraft. We also have locked in Hanwha providing the tilt actuators, one of the more complex mechanical bits on the aircraft. So there's a huge amount already done locked in as a supply chain for the certification aircraft. There's a lot more you'll see coming down the pipe over the next 6 months. Those will be some of the things you will see between now and December as we tie in more, and we'll provide a bit more clarity on that when we get to the Capital Markets Day. In terms of nonrecurring expenditure, that is something you will see stepping up over the next 12 to 18 months. As you know, we're incredibly capital efficient. We've done all of this when we fly full-scale piloted. We'll have done it significantly less than $1 billion than anyone else, but to a far higher standard because we've done it with regulatory oversight every single step of the way. Now as we lock in the supply chain, we then get into having to pay some nonrecurring expenditure, whether it's engineering, or we start laying out for the production tooling. And that's where we've got some choices to make around hard tooling, soft tooling, et cetera, that we'll look at over the coming 12 to 18 months. But that will drive a bit of the first step-up in the spend over the next 18 months.

Your next question comes from the line of Austin Moeller of Canaccord Genuity.

So just my first question here. If we think about the aircraft that you're going to build after Aircraft 3, presumably all of those that you're using for TC testing with the CAA will have an electric powertrain, and the hybrid powertrain aircraft would have to go through a separate parallel certification process?

Yes. Austin, thanks for the question. So you're absolutely correct. The aircraft that we build in December next year is a full electric aircraft, and then we'll build out another 4 or 5 of them that will just prove out this certification aircraft works. We'll prove out our manufacturing capabilities around it as well. I think just to be clear on the hybrid, because our hybrid is effectively the same aircraft, we take out a couple of batteries, install the hybrid in it. We've got plenty of space for that. We can still fit all of the people we need to in it. We've got the largest airframe in the industry. And we will be flying the hybrid next summer, full-scale, piloted to prove the concept. That means it's an incredibly fast follower through the certification process. So all-electric, still on track for 2028, and we expect the hybrid to be a very fast follower through into 2029. That's how we're seeing this play out, Austin. Hopefully, that brings a bit of color around it.

And would that hybrid powertrain be introduced with the supplemental type certificate? Or is that not how the process works with the CAA?

So yes, you do have to certify that product. But remember, all we're really doing is a modification to the current aircraft. So everything else is there, the flight control system, the airframe, all of that is there. We're just dropping in another propulsion system. So in terms of the step to go from the full electric to the hybrid, it's way less than I think people expect or understand, because we take the current aircraft we have. So we're incredibly lucky by having the right design fundamentals, the right size aircraft and airframe from day 1, we can drop in the hybrid and off we go. It's a great position to be in.

Okay. And just one more question. If we think about the cash burn into this first half of 2026, do you have GBP 104 million right now? Does that enable you to build Aircraft 3 and then build the next aircraft that you're referring to? Or does that sort of get partially through the construction process and get the long leads going with the supply chain?

So as I said earlier to Edison's question, we'll bring a lot more clarity to the financials over the next 1, 2, and 3 years at the Capital Market Day. As we stand here today, we have money through to the middle of next year, and we can do everything I've talked about. So we can and already have initiated production of the first aircraft for type certification testing. We'll build out Aircraft 3. We'll fly it full-scale piloted electric. We'll decommission, put hybrid in. So we have developed that hybrid all within the cash envelope. We'll install it in the aircraft within the cash envelope and be flying it. So yes, we've got all the money to keep driving forward as fast as possible on that.

Okay. Great. I look forward to hearing more in September.

Your next question comes from the line of Amit Dayal of H.C. Wainwright.

Stuart, just with respect to this Aciturri partnership, does this imply that your own CapEx needs from a manufacturing, build-out perspective will be lower than maybe what the Street has been anticipating?

So first of all, thank you for the question. In terms of the specific CapEx needs through to certification, whether that's around manufacturing facilities, tooling, etc., that is one of the things we're going to be talking about when we do the Capital Market Day. So I don't want to get into the details of that now, but we will address it on 17th of September. I think what I would say is this deal with Aciturri is incredibly exciting for us as a business. They've got outstanding capability. We understand their culture and our culture, how they come together to really move at a pace people haven't seen in aerospace. We're both incredibly dynamic, passionate, fast-moving companies. So we're so excited to be partnering with them for the build of our aircraft.

Understood. And with respect to the defense opportunity, what kind of milestones or what needs to happen within the EU, I guess, within that sector for you to potentially start building an order book for these aircraft?

Yes. Good question. I think the fundamental thing, if I break it into a couple of things. First off, we signed off the hybrid or I signed this off 18 months ago. So this isn't a hope and a prayer. This powertrain was working on the bench last summer. The single hardest thing to do is get the control algorithm to work between the power unit and the battery and our EPUs. We have broken through on that. We know it works. This is why I was very happy to announce it. What we're doing now is replacing one power unit with a different one. So we have done the difficult stuff. We then install it in an aircraft and fly it in public. And to bring this to the consciousness of the military, we flew a very public display of the aircraft in front of all the world's military into the world's biggest military air show a few weeks ago. So an incredible opportunity. Now that's generated a huge amount of discussions. We've already got a lot going on with the British military. This has opened up many other opportunities by putting us in the spotlight of over 25 different militaries that were there at the RIAT show. So we are in great shape. I wish I could say more about it now, but things are going very, very well. We've got the right airframe. We've got the right powertrain. We've got a capability that no one else can match in terms of range of payload. And I think importantly, a certification date that is faster than most people think, because we build on our certification of the electric aircraft.

Your next question comes from the line of Jesse Sobelson of D. Boral Capital.

It's Jesse Sobelson at D. Boral Capital. Not to belabor the point on the hybrid too much, but I was curious, how do you see the hybrid complementing the fully electric VX4 with the broader market strategy? What exactly is the goal there when it comes to market following the fully electric model?

So I think the first thing is, and I've said this already, we are so lucky that our airframe doesn't have to be adjusted. So we can bring this to market very quickly. In terms of complementing it, the first one is the military one that several people have asked about. There are huge opportunities, the geopolitical environment in which we sit now. We are the only European player providing this kind of product. And that European defense spending is going from $300 billion to $1 trillion over the next 7 to 10 years. So that puts us in an absolutely unique position to access that market because we are the single only European player. So that is great. Now I actually also look to the DoD and potential contracts there. I've signaled this before in the past. Our first manufacturing facility will be in Europe, highly likely to be in the U.K. We're in deep discussions with the U.K. government about where we can locate it. But I've always said the second manufacturing facility is highly likely to be in the U.S. Now we've got, I mentioned this earlier, a $1 billion deal with Honeywell to supply everything the pilot sees, feels, and touches and everything that controls the aircraft. So we've got a deep link into U.S. defense companies. We'll be putting our manufacturing facility here. That's highly likely. So I can see huge complementary opportunity as we certify VX4 full electric and then very quickly follow with a certification hybrid. So I do think it puts us in a great light. There are also, on top of all of that, commercial opportunities for the hybrid, which opens up a lot of different types of mission for the product. And maybe with that, if I can just invite Michael to see if there's anything else he would like to add on that.

Yes, sure. I mean that's a really good question. I think there's actually 2 complementary adjacencies here. What we see with most of our commercial customers today is relatively short-range missions. So things like connecting airports to the surrounding catchment area, tourism, so sightseeing flying into hotels, luxury destinations, and then some short-range regional connectivity where you might have geographical constraints that may mean it's difficult to get around on the ground. If you're flying those shorter missions, so less than 100 miles, the battery solution is perfect. It's really designed for that opportunity. Where hybrid comes in is that ability to fly longer missions without the need for charging stations on the ground, greater endurance, and so on. And really, there's 2 kind of different use cases. So this is not just a defense opportunity. There's absolutely a helicopter displacement opportunity. So when you look at our hybrid variant, it looks really competitive against intermediate single light twin helicopters. That's about a 400 helicopter a year market that we think we can tap into. And then, as Stuart said, there's actually a huge spectrum of different defense use cases ranging from logistics, Medevac, AutoAirVac, ISR, surveillance, etc. So they're really complementary. We don't really see one market cannibalizing the other. Effectively, we get 2 aircraft for the price of just over 1 with some really nice adjacent opportunities.

I want to remind everyone that the wing-borne testing took place in public airspace, including over people, schools, and hospitals, in collaboration with the U.K. regulator. We needed to demonstrate that our aircraft was capable of operating in public airspace, which was a significant challenge to overcome. It's exciting that we were allowed to do this. From our learnings, we found that our design is exceptional. The aircraft performed flawlessly. It was thrilling for us as an engineering company to see all our hard work and modeling come to life and match our expectations. We are now finalizing the evidence for two brief moments where we accelerate from 30 to 70 knots and decelerate from 70 to 30. Everything looks promising, and we just need to build the evidence base. What we've learned is that we have done an excellent job; the aircraft concept is viable. We are on track for a full transition this year, which means we are also on target to produce the first certification-ready aircraft by December next year. It has been an incredibly exciting few months for us.

I'd now like to hand the call back to the management for final remarks.

Great. So I'd just like to thank everyone for joining us on the call today. Really, really appreciate it. Some great questions. So thank you for joining. I really look forward to seeing you all on September 17 here in New York when we can bring some more clarity around the financial plan from here through to certification, including revenue opportunity after that, cost of certification, sources of funds for that. And I think we'll have some incredible keynote speakers, including Lord Andrew Parker. So look forward to seeing you all then. Thanks again for all the questions.

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