Red Cat Holdings appoints KPMG as new auditor, dismisses dbbmckennon

Red Cat Holdings, Inc. (NASDAQ:RCAT), a technology company with a market capitalization of $850 million and currently trading at $8.52, announced a change in its independent registered public accounting firm, according to a press release statement and a filing with the Securities and Exchange Commission. According to InvestingPro analysis, the company has shown remarkable performance with a 214% return over the past year, despite facing operational challenges.

On August 28, the Audit Committee of the Board of Directors approved the dismissal of dbbmckennon LLC as the company’s independent auditor, effective immediately. The committee also approved the engagement of KPMG LLP as the new independent registered public accounting firm for the fiscal year ending December 31, 2025.

Red Cat Holdings stated that the audit reports from dbbmckennon for the eight months ended December 31, 2024, and the years ended April 30, 2024 and 2023, did not contain any adverse opinions or disclaimers, and were not qualified or modified as to uncertainty, audit scope, or accounting principles.

The company reported that during these periods and through August 28, there were no disagreements with dbbmckennon regarding accounting principles, financial statement disclosure, or audit procedures that would have required disclosure. The only exception noted was a material weakness identified by dbbmckennon, which had previously been disclosed in the company’s annual reports filed on March 31, 2025, and August 8, 2024.

Red Cat Holdings also confirmed that prior to KPMG’s appointment, neither the company nor its representatives consulted with KPMG on any accounting principles, audit opinions, or any matters that would have constituted a disagreement or reportable event under SEC regulations.

The company has provided dbbmckennon with a copy of the disclosures and requested a letter addressed to the SEC stating whether dbbmckennon agrees with the company’s statements. The letter from dbbmckennon, dated September 4, 2025, is included as an exhibit to the filing.

This information is based on a press release statement and the company’s recent SEC filing.

In other recent news, Red Cat Holdings, Inc. reported second-quarter fiscal 2025 financial results that did not meet analyst expectations. The company posted an adjusted loss of -$0.15 per share, which was wider than the anticipated loss of -$0.12 per share. Revenue for the quarter was $3.22 million, significantly below the forecasted $7.72 million. Additionally, Red Cat announced the formation of Blue Ops, Inc., a new division aimed at developing uncrewed surface vessel weapons systems for maritime defense. The division will be led by Barry Hinckley and Alexander "Sandy" Spaulding, who bring extensive maritime industry experience. In another development, Fuzzy Panda Research released a critical short report questioning Red Cat’s Army contract and production capabilities. The report claimed that the company’s Low-Rate Initial Production contract with the U.S. Army is 46% smaller than what was previously promised. According to Fuzzy Panda, the contract is for 690 drone systems, which is significantly below earlier projections.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.