Umac stock jumped overnight on Wednesday after a report said President Donald Trump is weighing direct financial support for domestic defense technology firms, sending shares of several U.S. drone companies sharply higher in after-hours trading. Unusual Machines, Ondas Holdings, Red Cat Holdings and Kratos Defense & Security Solutions all rose between 2% and 20% as investors bet federal backing could flow into the sector.
The report said the talks involve the Pentagon and private drone firms, and could lead to funding packages that mix loans with government ownership stakes in selected companies. Unusual Machines was among the names mentioned as a possible investment consideration, alongside the drone supplier Performance Drone Works and Neros Technologies, putting a fresh spotlight on the smallest players in a defense market that has suddenly become a political priority.
The move lands as the administration’s proposed fiscal 2027 defense framework puts a heavy emphasis on autonomous warfare systems. It also comes as the Pentagon pushes its Drone Dominance initiative, which seeks to deploy roughly 300,000 lower-cost attack drones by the end of 2027. That plan has already turned drone makers into some of the market’s most closely watched defense names, and Wednesday’s report added another layer: the possibility that Washington could do more than buy the technology and actually help finance it.
Unusual Machines said on Wednesday that partner Powerus advanced to Phase II of the initiative, and the company said on X that Powerus had been selected to participate in Phase II of the Defense Department’s $1 billion Drone Dominance Program with its MatrixFold drone platform. The company described MatrixFold as low-cost, rapidly deployable and manufactured in the U.S. Unusual Machines also has a disclosed relationship with Donald Trump Jr., who is both a shareholder and advisory board member, a link that gives any federal-support story around the company extra market weight.
Ondas has been building its own case for investors as well. Earlier this month, it finalized a $196.6 million all-stock acquisition of defense software company Omnisys Ltd., then reported record fiscal first-quarter revenue and raised its full-year outlook. Its shares have gained over 7% in May. Red Cat, which builds small surveillance drones for soldiers and battlefield intelligence, has been raising production of its Black Widow drones and adding more AI features. Its stock has surged over 34% year-to-date.
Kratos, meanwhile, sits at the other end of the drone spectrum, making larger autonomous aircraft for advanced combat missions. The company posted first-quarter revenue growth of 22% as demand for programs such as the XQ-58A Valkyrie increased, even as its stock has slumped 24%. That contrast shows how uneven the market remains: investors are rewarding companies tied to the Pentagon’s push for autonomous systems, but they are still picking winners and losers based on scale, momentum and execution. For now, the real test for umac stock is whether speculation about federal support turns into a funding structure, or remains only a trade on policy hopes.
