Batteries & energy density

Flight time is payload math: every gram of battery a small UAS lifts is a gram of sensor, radio, or warhead it doesn't. That arithmetic makes gravimetric energy density — and who manufactures it outside China — the hardest physical chokepoint in the drone stack. China builds the large majority of the world's lithium cells and the overwhelming share of the commodity LiPo packs the small-drone industry was raised on, and Congress has already drawn the line: Section 154 of the FY24 NDAA bars DoD from obligating funds for batteries from CATL, BYD, EVE, Gotion, Envision, and Hithium beginning October 1, 2027.

The physical owner of the energy-density frontier today is Amprius (AMPX). Its silicon-anode cells ship at up to 450 Wh/kg — the SiMaxx nanowire line commercially since 2024 (500 Wh/kg third-party verified in 2023), joined by the contract-manufactured SiCore platform at 450 Wh/kg in May 2025 — roughly 50-70% more onboard energy per kilogram than the graphite cells in most Group 1-2 UAS — and the moat is design-ins, not press releases: Teledyne FLIR's Black Hornet 4 carries Amprius cells, AeroVironment and Kraus Hamdani are customers, and DIU has expanded its NDAA-compliant drone-battery contract three times, to $18.1M. In Q1 2026 Amprius printed $28.5M of revenue, up 153% y/y, and pointed to roughly $500M of new military awards landing at its drone customers — forward demand for its cells. Behind it, EnerSys (ENS) is building the capacity layer: a $615M, 5 GWh Greenville lithium gigafactory backed by a $199M DOE award, including a ~$50M DoD-dedicated line, plus Bren-Tronics' military battery franchise.

What breaks the choke is not better chemistry in a lab — it's NDAA-clean chemistry at gigawatt-hour scale. Enovix (ENVX) has the cell science and a Korea-manufactured pipeline above $130M, the majority driven by drone applications, but its center of gravity is still smartphone qualification at Fab2 Malaysia. Lyten's lithium-sulfur cells are NDAA-compliant by construction — no graphite, nickel, or cobalt — though today's production Li-S cells still sit below the silicon-anode frontier on energy density. The honest bear case on Amprius is the same scale question: it paid $20M to exit its Brighton, Colorado gigafactory lease and leans on contract manufacturers, much of that capacity in Asia — which is why the Nanotech Energy partnership to onshore silicon-anode production under FY26 NDAA rules is the most important non-financial datapoint in the story. Whoever operates domestic GWh-scale silicon-anode lines first effectively owns DoD small-UAS propulsion into 2030.

The repricing clock has three alarms. First, the October 1, 2027 Section 154 deadline: primes must lock non-Chinese cell supply roughly a year ahead, so 2H26 is when multi-year agreements get signed. Second, the FAA's Part 108 BVLOS final rule — now past its executive-order March 2026 target after the comment period was reopened in January — which turns commercial logistics fleets into the same energy-density buyers as DoD. Third, Amprius' August print: if the raised ≥$130M 2026 revenue guide converts into disclosed cell backlog and a credible US-made output number, the market stops valuing AMPX as a battery startup and starts valuing it as the sole qualified supplier of flight time.