Unusual Machines is moving to expand its U.S.-based drone supply chain through a definitive merger agreement to acquire DroneNX LLC, the company operating as Upgrade Energy. The transaction, announced on May 11, 2026, is valued at about $52 million and is expected to combine cash, stock, and performance-based earnout consideration. The deal positions Unusual Machines to strengthen its domestic battery and power systems capabilities at a time when demand for secure, NDAA-compliant drone components continues to rise.
A Strategic Move Into Drone Power Systems
Upgrade Energy specializes in battery and power systems for unmanned aerial systems, a category that directly affects drone flight time, reliability, payload performance, and operating range. By adding the company’s capabilities, Unusual Machines is seeking to broaden its component portfolio beyond its existing drone technology brands and deepen its role as a domestic supplier. The acquisition also supports the company’s stated ambition to become a major Tier-1 parts provider for the U.S. drone industry.
Manufacturing Expansion Plans
Upgrade Energy currently operates from an 18,500-square-foot facility in Torrance, California, with approximately 30 engineering and production employees. Unusual Machines said it plans to expand battery pack operations by opening a second production facility in Orlando, Florida, in the coming months. That expansion would bring additional battery manufacturing closer to Unusual Machines’ Florida base while preserving Upgrade Energy’s existing California production expertise.
Leadership Rationale
Unusual Machines Chief Executive Officer Allan Evans described batteries as a core element of drone power systems because they strongly influence performance and reliability. In his view, Upgrade Energy brings both technical depth and operational talent that can accelerate the company’s manufacturing roadmap. Upgrade Energy Chief Executive Officer Matthew Barnard said the combination gives his team greater scale and support to advance high-performance drone battery development in the United States.
Deal Structure and Closing Conditions
Additional transaction details indicate that the agreement was signed on May 7, 2026, with closing expected within 120 days, subject to customary requirements. Reported terms include 1,792,012 Unusual Machines shares, $1 million in cash at closing, and a potential earnout of up to $26 million tied to achieving a $10 million annual revenue target over a two-year period. The transaction also remains subject to completion of Upgrade Energy’s 2025 audit before closing.
Market and Industry Context
The announcement comes as drone manufacturers and buyers place greater emphasis on domestic production, supply-chain security, and compliance with U.S. procurement standards. Unusual Machines already owns brands including Fat Shark, known for FPV drone goggles, and Rotor Riot, an ecommerce platform serving FPV drone users and enthusiasts. Public company coverage also noted that investors reacted positively to the acquisition announcement, with Unusual Machines shares rising more than 14% during the May 11 trading session.
The planned acquisition of Upgrade Energy gives Unusual Machines a clearer path into one of the most critical areas of drone performance: battery and power systems. While the deal still depends on closing conditions, including the required audit, it could materially expand the company’s domestic engineering, manufacturing, and component capabilities. If completed, the merger would strengthen Unusual Machines’ position in the evolving U.S. drone ecosystem as customers increasingly look for reliable, American-made alternatives in critical drone technologies.