Wrap Technologies submits counter-drone system for U.S. Army competition

MIAMI - Wrap Technologies, Inc. (NASDAQ:WRAP), a $107 million market cap company that has seen its stock surge 23% in the past week according to InvestingPro, announced Wednesday it has submitted its counter-unmanned aerial system (C-UAS) technology for the U.S. Army’s xTechCounter Strike competition.

The submission, called Project Merlin-1KC, features a modular system designed to physically disable small hostile drones by deploying lightweight tethered projectiles that entangle drone rotors. The system aims to neutralize threats without relying on electronic warfare or directed energy. InvestingPro data shows the company maintains strong financial flexibility with a healthy current ratio of 5.65 and operates with moderate debt levels, potentially supporting its military market expansion efforts. Subscribers can access 6 additional ProTips and comprehensive analysis in the Pro Research Report.

According to the company, the Merlin platform can be integrated across multiple platforms including unmanned vehicles, turrets, vehicle mounts, and soldier-worn launchers. The system has an anticipated retail cost under $60 per shot.

"We believe our MERLIN system represents a breakthrough in C-UAS offensive and defensive battlefield capacity," said Jared Novick, President and Chief Operating Officer of Wrap. "It is designed to flip the cost curve by providing the Army and allied forces with a sustainable and scalable solution against the growing threat of unmanned systems."

The company stated its current production capacity can deliver up to 20,000 units monthly, with potential to scale to 75,000 units. Wrap reports that 85% of its supply chain is U.S.-based, with plans to reach 100% domestic manufacturing. With current revenues of $3.24 million and a gross margin of 53.4%, the company’s production capabilities significantly exceed its current commercial output.

The U.S. Army competition seeks innovative technologies to protect forces against small drones on the battlefield. Selected participants may receive cash prizes, invitations to experimentation events, and potential contracting opportunities with the Department of Defense and NATO partners.

This submission represents Wrap’s effort to expand beyond its law enforcement products, which include the BolaWrap restraint device. The company indicated the move aligns with its strategy to create new opportunities in defense markets. While currently unprofitable, detailed financial analysis and growth prospects are available through the comprehensive Pro Research Report on InvestingPro, which covers over 1,400 US stocks with expert insights and actionable intelligence.

The announcement was made in a press release statement from the company.

In other recent news, Wrap Technologies announced the completion of a $4.5 million private placement agreement with institutional investors. This agreement includes the sale of 4,500 shares of Series B Convertible Preferred Stock, which can be converted into 3 million common shares, and warrants to purchase an additional 3 million shares. The funds raised are intended to support the advancement of Wrap Technologies’ counter-drone technology and expansion of law enforcement offerings. Additionally, the company introduced the 1KC: Kinetic Anti-Drone Cassette, marking its entry into the counter-unmanned aerial systems market. This new technology leverages Wrap’s existing BolaWrap technology to disable drones in flight. In another development, Wrap Technologies launched WrapTactics, a digital training platform aimed at preventing skill degradation among law enforcement officers. The platform offers short-form training modules focusing on critical policing skills. Furthermore, the company announced a strategic partnership with STORM Training Group to integrate defensive tactics training with its BolaWrap device deployment.

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