Archer Aviation stock jumps 9% on FAA certification optimism amid eVTOL industry tailwinds

Archer Aviation Inc. (NYSE: ACHR) surged 9.11% on Friday to close at $13.30, marking one of its sharpest single-day rallies in recent months as speculation intensified around a possible pre-certification green light from the U.S. Federal Aviation Administration (FAA) for its electric vertical takeoff and landing (eVTOL) aircraft, Midnight. The move added nearly $600 million to the company’s market capitalization, pushing its valuation beyond $7.3 billion. Archer Aviation has now rallied more than 229% over the past twelve months, solidifying its position as one of the top-performing U.S. e-mobility stocks and a hedge fund favorite in the nascent urban air mobility sector.

The stock’s upward momentum was driven by unconfirmed reports and growing investor sentiment that the FAA could soon complete a key stage in the company’s type certification process—a critical milestone on the path to full commercial airworthiness of Archer’s Midnight aircraft. The FAA pre-certification buzz drove a dramatic spike in trading activity, with volume exceeding 69 million shares, far above its 30-day average. Traders and long-term investors alike appeared to be pricing in the potential for earlier-than-expected commercialization, a major catalyst in the competitive eVTOL landscape.

Why Did Archer Aviation Stock Rise on May 17, 2025?

The latest surge in Archer Aviation’s stock price follows a pattern of investor enthusiasm tied to regulatory and commercial breakthroughs in the eVTOL industry. Archer is currently progressing through the FAA’s four-stage certification pathway and is reportedly nearing the conclusion of the second phase, which covers detailed system-specific assessments and testing. Pre-certification speculation implies Archer may be ready to transition into the final testing and compliance verification stages sooner than anticipated.

These developments come at a time when regulatory clarity for powered-lift aircraft is beginning to materialize. The FAA’s updated Special Federal Aviation Regulation (SFAR) for powered-lift operations, unveiled in late 2024, laid out a clearer regulatory roadmap for eVTOL manufacturers, accelerating timelines for aircraft like Midnight. The regulation harmonizes pilot training, maintenance procedures, and operational standards with existing frameworks used in commercial aviation, providing companies like Archer with more predictable regulatory oversight and investor confidence.

Additionally, analyst sentiment has been trending positive. Several brokerages, including Cantor Fitzgerald, have reiterated an “Overweight” rating on Archer Aviation, citing the company’s strong cash reserves, strategic partnerships, and rapid technical progress. The firm closed 2024 with over $1 billion in liquidity and has made notable strides in expanding its global footprint through commercial agreements in the United States and the Middle East.

How Is Archer Aviation Positioned in the eVTOL Market?

Founded in 2018, Archer Aviation has quickly emerged as one of the most credible challengers in the race to commercialize eVTOL aircraft. Its flagship model, Midnight, is designed to carry four passengers and one pilot on short-haul urban and regional flights with a range of up to 100 miles. The company has consistently positioned itself as a first-mover in the aerial mobility segment, emphasizing scalable manufacturing, low-noise electric propulsion, and integrated ecosystem partnerships.

Archer’s key differentiators include its partnership with Stellantis for high-volume manufacturing and its strategic collaboration with United Airlines. Stellantis has committed to supporting Archer’s mass production by leveraging its automotive-grade supply chain, while United Airlines has placed conditional purchase agreements for up to 200 aircraft, signaling institutional endorsement of Archer’s commercial viability.

Beyond the U.S., Archer recently signed a memorandum of understanding with Abu Dhabi Investment Office and Abu Dhabi Aviation to bring Midnight operations to the UAE, with commercial deployment targeted by late 2025. These international developments further differentiate Archer from its competitors and showcase its intent to capture a global share of the air taxi market.

What Is Driving Institutional and Hedge Fund Interest in Archer?

Archer’s sharp rally over the past year has not gone unnoticed by institutional investors. Hedge funds with growth mandates and exposure to next-generation mobility technologies have steadily increased their positions in Archer Aviation. According to recent 13F filings, funds such as ARK Invest, BlackRock, and Vanguard have maintained or added to their holdings, betting on the firm’s long-term prospects in a space where first-mover advantage could prove decisive.

The stock’s risk-reward profile—high upside tied to regulatory wins and commercial launches, versus execution risk and pre-revenue status—continues to attract speculative but calculated capital. Options activity has also surged around Archer, with call option volumes spiking on Friday as traders bet on continued upside in the near term.

Buy-side interest appears focused on three pillars: successful FAA certification of Midnight, evidence of operational readiness for air taxi deployment, and continued strategic partnerships with logistics, infrastructure, and aviation stakeholders.

How Does Archer Compare to Other eVTOL Contenders?

Archer competes in a crowded but still emerging landscape that includes Joby Aviation, Vertical Aerospace, Lilium, and EHang. While Joby has taken an early lead with DoD contracts and FAA progress, Archer has differentiated itself through manufacturing scalability, a narrower commercial focus, and more defined revenue partnerships.

Unlike some of its rivals that remain tethered to development grants and testing contracts, Archer’s commercialization playbook is already unfolding through announced urban routes, production timelines, and international agreements. Investors are watching how each of these players manages the capital-intensive runway to profitability, particularly given global interest rate headwinds and market scrutiny on pre-revenue tech stocks.

With strong institutional backing and a clear roadmap to launch, Archer is increasingly viewed as one of the few eVTOL companies that could cross the commercialization threshold by 2025.

What Does the Sentiment Analysis Say About Archer’s Stock Performance?

Archer Aviation’s 9.11% rise on May 17 appears supported by both technical momentum and fundamental speculation. The stock has been in a strong uptrend over the past 12 months, appreciating more than 229% year-on-year, making it one of the best-performing pre-commercial aerospace stocks on the NYSE. Market sentiment on social trading platforms and retail investor forums has turned bullish, with trading volumes at nearly 10x the average on the latest move.

Institutional flows, as tracked by recent Form 13F filings and fund rebalancing trends, suggest steady accumulation. Buy-side sentiment remains optimistic as Archer enters a period of potential regulatory validation and pre-commercial trials. Short interest in the stock has declined modestly over the last quarter, further indicating that bearish bets are being unwound in the face of progress.

While there are no current dividends or earnings guidance to anchor valuations, sentiment is driven primarily by milestone anticipation—FAA certification, manufacturing scale-up, and urban test flight success. Archer remains in the “buy the rumor” phase for most institutional strategies, but consensus appears to favor a “hold” for those awaiting revenue traction.

What’s Next for Archer Aviation and Its eVTOL Launch?

Looking ahead, Archer is expected to provide key updates on its certification pathway and manufacturing readiness in its upcoming quarterly disclosures. Analysts and investors will also be monitoring test flight data, FAA interaction disclosures, and public-private urban mobility partnerships. If the FAA moves forward with pre-certification as speculated, it could compress timelines for commercial launch and unlock further upside.

With airspace regulators globally taking interest in eVTOL frameworks, 2025 could be the inflection year for companies like Archer to transition from prototype to platform. Archer’s operational model, centered around low-cost, point-to-point regional travel using electric air taxis, directly aligns with global urban planning efforts targeting carbon neutrality and congestion mitigation.

The company’s partnerships in the UAE and with U.S. urban transit hubs also position it as a leading candidate in the race to launch passenger flights. Although profitability may remain a long-term goal, its present momentum has set the tone for broader investor confidence in the electrification of aviation.