Earnings release
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Draganfly Announces Third Quarter Results of 2025 Vancouver, BC. November 12, 202 5 – Draganfly Inc. (NASDAQ: DPRO) (CSE: DPRO) (FSE: 3U8 A) (“Draganfly” or the “Company”), an award -winning, industry -leading drone solutions and systems developer, is pleased to announce its third quarter financial results. Key Financial Highlights for Q3 2025: ● Revenue for the third quarter of 2025 was $2,155,993, which represents a 14.4% year over year increase. Product sales of $1,622,286 were up 22.1% over the same period last year. ● Gross profit for Q3 2025 was $420,947, down 4.5% from $440,780 for the same period last year. Gross margin percentage for Q 3 2025 was 19.5% compared to 23.4% in Q 3 2024. Gross profit would have been $ 464,284 and gross margin would have been 21.5%, not including a one -time non-cash write down of inventory of $43,337. The decrease is due to the sales mix of the products sold. ● An adjusted comprehensive loss of $3,579,510 not including non-cash changes comprised of a negative change in fair value derivative of $ 1,837,618, a write down of inventory of $ 43,337, and an impairment gain on notes receivable of $35,461 and would otherwise be a comprehensive loss inclusive of non -cash items of $ 5,425,004 compared to an adjusted comprehensive loss of $3,771,250 for the same period last year . Contributors to the year-over-year decrease are a gain in foreign exchange, a decrease in professional fees offset by an increase in office and miscellaneous, employee and management expenses, and share based payments. ● Cash balance on September 30, 2025 of $69,881,348 compared to $6,252,409 on December 31, 2024. Key Operational Highlights for Q3 2025: • Selected by the U.S. Army to supply Flex FPV Drone Systems, further strengthening its partnerships within the U.S. defense ecosystem. • Commander 3XL UAV was selected by a major branch of the U.S. Department of Defense for advanced operational initiatives, reinforcing its leadership in tactical UAV solutions. • Announced the sale of its Commander 3XL UAV systems to a globally recognized defense contractor specializing in persistent surveillance technologies for military operations. The systems will enhance perimeter security, early warning, and real-time situational awareness for Department of Defense and allied installations, further establishing the Commander 3XL as a trusted ISR platform. • Completed the sale of multiple Heavy Lift Drones to a Fortune 50 telecommunications company for UAV-based emergency response and communications network applications, following extensive field testing • Announced the expansion of its U.S. manufacturing footprint to meet increasing demand for scalable, American-made drone solutions. • Successfully demonstrated its Commander 3XL and Flex FPV drone systems in an invite only live exercise at the T -REX 24 -2 Military Technology Exercise, validating multi -domain defense capabilities including ultra-low-latency close-quarters aerial intelligence and deployable logistics for the U.S. Department of War.
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• Announced a teaming agreement with Autonome Labs to highlight landmine route -clearance technologies at the Countering Explosives Conference, underscoring Draganfly’s commitment to humanitarian and defense innovation. • Raised US$25 million through a registered direct offering to institutional investors, providing critical funding to accelerate growth, product innovation, and acquisition initiatives. This strategic financing strengthens the company’s balance sheet and positions it to capitalize on emerging opportunities in the rapidly evolving drone technology sector. Subsequent Events ● On October 24, 2025, the Company filed a new final short form base shelf prospectus and a corresponding registration statement on Form F-10, replacing the base shelf prospectus and Form F-10 registration statement previously filed by the Company in 2023, which will enable the Company to make public offerings of up to C$300 million; Draganfly will hold a shareholder update, and earnings call on November 12, 2025, at 2:30 p.m. PDT / 5:30 p.m. EDT Registration for the call can be done Here Selected financial information is outlined below and should be read with Draganfly’s consolidated financial statements for the quarter ended September 30, 202 5, and associated management discussion and analysis, which will be available under the Company's profile on SEDAR + at www.sedarplus.ca and filed on EDGAR at www.sec.gov. Three months ended September 30, Nine months ended September 30, 2025 2024 2025 2024 Total revenues $ 2,155,993 $ 1,885,322 $ 5,818,963 $ 4,947,894 Gross Margin (as a % of revenues) (1) 19.5% 23.4% 21.2% 23.9% Net income (loss) (5,169,797) (200,194) (13,356,78 3) (9,155,551) Net income (loss) per share ($) - Basic (0.25) (0.06) (1.17) (3.28) - Diluted (0.25) (0.06) (1.17) (3.28) Comprehensive income (loss) (5,425,004) (364,549) (13,608,35 0) (9,346,603) Comprehensive income (loss) per share ($) - Basic (0.26) (0.11) (1.20) (3.35) - Diluted (0.26) (0.11) (1.20) (3.35) Change in cash and cash equivalents $ 47,310,289 (1,292,970) $ 63,628,939 $ 903,965 (1) Gross Profit (as a % of revenues) would have been 21.5% and 32.7% not including a non-cash write down of inventory for $43,337 and $176,422 respectively for the three -month period ending September 30, 2025 and 2024. Gross Profit (as a % of revenues) would have been 21.5% and 33.2% not including a non -cash write down of inventory for $15,091 and of $459,591 respectively for the nine month period ending September 30, 2025 and 2024. As at September 30, 2025 December 31, 2024 Total assets $ 77,081,061 $ 10,200,088 Working capital 69,539,212 3,846,283 Total non-current liabilities 212,723 342,013 Shareholders’ equity $ 70,432,421 $ 4,621,783 Number of shares outstanding 23,261,012 5,427,795
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Shareholders’ equity and working capital as at September 30, 2025, includes a fair value of derivative liability of $3,037,087 (2024 - $2,198,121) and would otherwise be $73,469,508 (2024 - $6,819,904) and $72,576,299 (2024 - $6,044,404), respectively. 2025 Q3 2025 Q2 2024 Q3 Revenue $ 2,155,993 $ 2,115,255 $ 1,885,322 Cost of sales(2) $ (1,735,046) $ (1,610,663) $ (1,444,542) Gross profit(3) $ 420,947 $ 504,592 $ 440,780 Gross margin – percentage 19.5% 23.9% 23.4% Operating expenses $ (5,346,776) $ (4,974,316) $ (4,125,078) Operating income (loss) $ (4,925,829) $ (4,469,724) $ (3,684,298) Operating loss per share - basic $ (0.24) $ (0.57) $ (1.10) Operating loss per share - diluted $ (0.24) $ (0.57) $ (1.10) Other income (expense) $ 1,593,650 $ 112,119 $ (91,455) Change in fair value of derivative liability (1) $ (1,837,618) $ (180,318) $ 3,575,559 Other comprehensive income (loss) $ (255,207) $ 12,527 $ (164,355) Comprehensive income (loss) $ (5,425,004) $ (4,749,634) $ (364,549) Comprehensive income (loss) per share - basic $ (0.26) $ (0.60) $ (0.11) Comprehensive income (loss) per share - diluted $ (0.26) $ (0.60) $ (0.11) (1) Included in other income (expense). (2) Cost of goods sold includes non-cash inventory write downs of $10,421 in Q2 2025 and a write down of $43,337 in Q3 2025 and would have been $1,600,242 in Q2 2025 and $1,691,709 in Q3 2025 before these recoveries. (3) Gross profit would have been $515,013 in Q2 2025 and $464,284 in Q3 2025 without the write downs in number 2 above. (4) Cost of goods sold includes a write down of $176,422 in Q3 2024 and would have been $1,268,120 in Q3 2024 before this write down. (5) Gross profit would have been $617,202 in Q3 2024, without the write down in number 4 above. About Draganfly Draganfly Inc. (NASDAQ: DPRO; CSE: DPRO; FSE: 3U8 A) is the creator of quality, cutting -edge drone solutions, software, and AI systems that revolutionize the way organizations can do business and service their stakeholders. Recognized as being at the forefront of technology for over 2 5 years, Draganfly is an award-winning industry leader serving the public safety, public health, mining, agriculture, industrial inspections, security, mapping, and surveying markets. Draganfly is a company driven by passion, ingenuity, and the need to prov ide efficient solutions and first -class services to its customers around the world with the goal of saving time, money, and lives. • CSE • NASDAQ • FRANKFURT Media Contact Erika Racicot Email: media@draganfly.com Company Contact Cameron Chell Chief Executive Officer
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(306) 955-9907 info@draganfly.com Note Regarding Non-GAAP Measures In this press release we describe certain income and expense items that are unusual or non -recurring. There are terms not defined by International Financial Reporting Standards (IFRS). Our usage of these terms may vary from the usage adopted by other compa nies. Specifically, gross profit and gross margin are undefined terms by IFRS that may be referenced herein. We provide this detail so that readers have a better understanding of the significant events and transactions that have had an impact on our results. Throughout this release, reference is made to “gross profit,” and “gross margin,” which are non -IFRS measures. Management believes that gross profit, defined as revenue less operating expenses, is a useful supplemental measure of operations. Gross profit h elps provide an understanding on the level of costs needed to create revenue. Gross margin illustrates the gross profit as a percentage of revenue. Readers are cautioned that these non -IFRS measures may not be comparable to similar measures used by other companies. Readers are also cautioned not to view these non -IFRS financial measures as an alternative to financial measures calculated in accordance with International Financial Reporting Standards (“IFRS”). For more information with respect to financial measures which have not been defined by GAAP, including reconciliations to the closest comparable GAAP measure, see the "Non -GAAP Measures and Additional GAAP Measures" section of the Company’s most recent MD&A which is available on SEDAR. Forward-Looking Statements This release contains certain “forward looking statements” and certain “forward -looking information” as defined under applicable Canadian and U.S. securities laws. Forward-looking statements and information can generally be identified by the use of forward -looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “continue”, “plans” or similar terminology. Forward -looking statements and information are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward - looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of the Company to control or predict, that may cause the Company’s actual results, performance or achievements to be materially different from those expressed or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not limited to statements in respect of Draganfly’s partnerships, capabilities and expertise, as well as its financial condition, the successful integration of technology, the inherent risks involved in the general securities markets; uncertainties relating to the availability and costs of financing needed in the future; the inherent uncertainty of cost estimates and the potential for unexpected costs and expenses, currency fluctuations; regulatory restrictions, liability, competition, loss of key employees and other related risks and uncertainties disclosed under the heading “Risk Factors“ in the Company’s most recent filings filed with securities regulators in Canada on the SEDAR+ website at www.sedarplus.ca and with the U.S. Securities and Exchange Commission on the EDGAR website at www.sec.gov. The Company undertakes no obligation to update forward-looking information except as required by applicable law. Such forward -looking information represents managements’ best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.