DETROIT — The Pentagon awarded AeroVironment a $500 million contract for commercial counter-drone technology for the military. The contract is set to last for three years.

The contract details were listed under the Army section of the Defense Department's online contract update, which was posted on a Wednesday. The Army Contracting Command Detroit Arsenal in Michigan is listed as the contracting activity for the award. Specific locations and funding amounts are to be determined with each order issued under the contract. This initiative aims to build defenses against small unmanned aerial systems.

AeroVironment manufactures Switchblade loitering drones and the LOCUST directed energy laser. The Joint Interagency Task Force 401, which serves as the Pentagon's counter-drone team, frequently provides funding for unmanned aerial system defense technology. This task force tested the LOCUST system earlier in the year of the announcement at White Sands Missile Range in New Mexico.

One month after the White Sands test, the Pentagon and the Federal Aviation Administration signed an agreement. This agreement determined that the lasers were safe to use in American airspace. Wahid Nawabi, CEO of AeroVironment, stated that the cost-per-shot of the LOCUST laser can be as low as $3. Lawmakers from both parties criticized agencies, including the Federal Aviation Administration, over dual airspace incidents.

AeroVironment had reported record fourth-quarter revenue earlier in the week of the announcement, with figures that bucked estimates. Following the company's earnings call on a Monday, AeroVironment's shares increased by nearly 19%. The company's shares increased again after the announcement of the Army contract.