Archer notched another successful test flight this time over crowds at an air show.
A social media post on Friday caused rumors to swirl that the company could soon partner with Tesla.
Shares of Archer Aviation (NYSE: ACHR) are climbing on Monday, up 15.6% as of 2:03 p.m. ET. The spike comes as the S&P 500 is up 0.4%, and the Nasdaq Composite is up 0.7%.
Archer successfully showed off its electric vertical takeoff and landing (eVTOL) aircraft Midnight at the California International Air Show over the weekend as rumors swell regarding a possible Tesla partnership.
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Archer's Midnight eVTOL took off and flew above the crowds at the 2025 California International Air Show in Salinas, California this weekend. The company noted the lack of noise produced by Midnight despite reaching speeds of 125 miles per hour. The flight comes on the heels of two of Midnight's highest-altitude test flights to date, with one reaching 10,000 feet, bringing the aircraft one step closer to full commercial flight, which management expects to achieve in 2026.
Image source: Getty Images.
It also follows a social media post from Archer on Friday that featured a Tesla vehicle and an Optimus robot. Many investors took this to mean the two companies could soon announce an official partnership.
While the rumor is exciting, it remains just that at this point -- a rumor -- and even if a partnership is on the horizon, it's not known how substantial it would be. Archer is still a pre-revenue company burning cash as it develops unproven technology. The opportunity could be enormous, but it is hard to truly gauge just how much demand there is for eVTOLs. With a nearly $9 billion market capitalization, the market will have to be pretty big. I would avoid Archer at this point.
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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.