Air Industries Group (AIRI)

Executive Summary

Air Industries Group is a Bay Shore, New York-based manufacturer of precision components and assemblies for the aerospace and defense industry, trading on NYSE American under AIRI. Operating through subsidiaries Air Industries Machining (AIM), Nassau Tool Works (NTW), and Sterling Engineering Company (STE) from facilities in Long Island, New York and Barkhamsted, Connecticut, the company generated $47.9 million in 2025 net sales with roughly 150-160 employees. Air Industries is a Tier One/Tier Two supplier of flight-critical hardware — landing gear, flight controls, engine mounts, and jet engine components — to major aerospace and defense prime contractors, and in February 2026 it agreed to a transformative reverse-merger with Tenax Aerospace that, if completed, would make current Air Industries shareholders a small minority owner of a much larger combined company.

Core Business Model & How They Work

Air Industries manufactures mission-critical structural and mechanical aerospace components — landing gear, flight control surfaces, engine mounts, and jet-engine parts — under long-term agreements (LTAs) with prime contractors and, in some cases, larger Tier One suppliers. Revenue is driven by production volume tied to specific military and commercial aircraft platforms, with a substantial order backlog ($136.8 million, up 16% year over year) and unfilled contract value of $270.1 million providing multi-year revenue visibility. A book-to-bill ratio of 1.36x in 2025 indicates bookings are currently outpacing shipments, a positive signal for future revenue, though the business remains capital- and labor-intensive precision machining with thin margins typical of the lower tiers of the defense supply chain.

Business Segments

Air Industries does not report distinct financial segments but operates through three manufacturing subsidiaries that function as an integrated production base: Air Industries Machining (AIM), Nassau Tool Works (NTW), and Sterling Engineering Company (STE), together spanning over 150,000 square feet across two sites.

Product Portfolio

Core products include landing gear assemblies, flight control components, engine mounts, jet engine components, and complex machined assemblies for both aircraft and ground-based turbines. Its parts fly on major defense platforms including the Pratt & Whitney Geared Turbofan engine, the UH-60 Black Hawk and CH-53 helicopters, the E-2D Hawkeye, and fighter aircraft including the F-35 Lightning II, F-18 Hornet, and F-15 Eagle — these platforms together accounted for 79.7% of 2025 net sales.

Competitive Landscape

Air Industries competes with other precision aerospace machining and structural-parts suppliers including Monitor Aerospace, Hydromil, Héroux-Devtek, and Ellanef Manufacturing. The company explicitly acknowledges in its filings that competitors "have significantly greater technical, manufacturing, financial and marketing resources," reflecting its position as a small, sub-scale player in a supply chain dominated by much larger Tier One aerostructures firms.

Strategic Strengths & Risks

Strengths: Long-standing qualified-supplier status on high-value, long-production-run military platforms (Black Hawk, F-35, GTF engine); a growing backlog and >1x book-to-bill ratio providing revenue visibility; and heavy customer concentration in the resilient U.S. defense budget (58.3% of 2025 sales tied to military end-use, with customers including RTX, Lockheed Martin, Northrop Grumman, and GE).

Risks: The company posted a 2025 net loss of $1.3–1.8 million on declining sales (down ~13% from $55.1 million in 2024), with thin gross margins (~22%); it is sub-scale versus competitors with far greater resources; and most significantly, the pending merger with Tenax Aerospace Acquisition, LLC (announced February 2026, amended/extended as of August 2026) would have Air Industries issue ~112.5 million new shares to Tenax members, who would own roughly 95-96% of the combined company — existing AIRI shareholders would be diluted to a small minority stake, and the company's core identity as a precision-parts manufacturer could be fundamentally altered as it combines with Tenax's special-mission aviation sourcing/financing/modification business. The deal remains subject to shareholder approval and regulatory (HSR) clearance and is not yet final.

Financial Overview

• Market capitalization: approximately $12.9 million (as of September 2026) — a micro-cap
• Stock price: approximately $2.66/share
• FY2025 net sales: $47.9 million (down from $55.1 million in FY2024, -13%)
• FY2025 net loss: approximately $1.3–1.8 million (EPS approximately -$0.37)
• Gross margin: approximately 22.3% (Q3 2025)
• Backlog: $136.8 million; total unfilled contract value: $270.1 million; book-to-bill: 1.36x
• Employees: ~150-160

Summary Conclusion

Air Industries is a small, thinly-margined but strategically embedded defense-supply-chain manufacturer with a solid backlog on enduring military platforms, offset by declining current-year sales and a net loss. The pending Tenax Aerospace merger is the dominant near-term variable for the stock: if completed, it would transform Air Industries into a much larger, differently-focused special-mission aviation platform in which legacy shareholders hold only a small stake, making the investment thesis for AIRI today largely a bet on that transaction's terms and completion rather than on the standalone machining business.