Ondas Inc. (NASDAQ: ONDS) went from a small-cap autonomous systems name to a serious player in the defense technology conversation this morning. The company announced it has closed on the acquisition of DZYNE Technologies for $875.8 million, a deal that reshapes the company’s revenue base, its product portfolio, and arguably its entire investment thesis.
The transaction was funded through a mix of cash and stock. DZYNE shareholders received $200 million in cash and roughly 85 million Ondas shares valued at approximately $675 million. That leaves the DZYNE group, led by private equity firm Highlander Partners, holding about 13.8% of Ondas’ outstanding shares. More than half of the equity consideration, 45 million shares, is subject to a six-month lock-up. That is a meaningful signal about how the sellers view the combined company.
What Ondas Just Bought
DZYNE is a U.S. defense technology company known for long-endurance autonomous aircraft, counter-drone systems, and what the industry now calls “autonomous effects.” Translated, that means expendable, low-cost unmanned platforms designed to be deployed at scale rather than treated as high-value single assets. The Pentagon has been pushing this “affordable mass” concept aggressively, and DZYNE sits directly in the middle of it.
The DZYNE portfolio brings three distinct franchises to Ondas. ULTRA is a long-endurance ISR aircraft with tens of thousands of operational flight hours already logged. IonStrike is a kinetic counter-drone interceptor purpose-built to defeat Shahed-136 class attack drones, the kind that have become a defining threat in modern conflict. Blitz is a Group 1 UAS with 150 kilometers of range and swarm capabilities. Grasshopper is an autonomous cargo glider that delivers up to 500 pounds into contested environments. Add Dronebuster, one of the most widely fielded handheld counter-drone systems in the world, and Ondas now owns a portfolio that has absorbed more than $500 million in cumulative R&D.
The Financial Case
This is where the story gets interesting for small-cap investors. DZYNE is expected to generate $191 million in revenue for 2026 and more than $300 million in 2027. The company is already EBITDA positive with margins targeted in the mid-teens for 2027 and the mid-20% range by 2028.
Ondas raised its 2026 revenue target to at least $525 million, up meaningfully from the prior target of at least $390 million. That figure includes DZYNE and the Omnisys acquisition that closed in May, but does not yet include Cyberhawk, which is expected to close in the third quarter. The company is guiding to a greater than 80% revenue CAGR from 2025 through 2028.
Ondas Sentinel
To manage the expanding U.S. defense portfolio, Ondas is forming a new operating division called Ondas Sentinel. It will house DZYNE alongside World View, the stratospheric platform business Ondas already owned. Ryan Hartman, currently CEO of World View, will run Ondas Sentinel as CEO. Matt McCue, co-founder and CEO of DZYNE, becomes CTO. The structure gives Ondas an integrated ISR stack that spans stratospheric sensing, long-endurance theater ISR, and tactical-edge autonomous operations, all connected through SkyWeaver, a mission software layer being built on Palantir Foundry and AIP.
The Bottom Line
Small-cap defense has been one of the most active corners of the market this year, and Ondas just planted a flag. The company is now positioned as a serious platform play in autonomous defense, with real revenue, positive EBITDA contribution, and a product suite aligned to the exact priorities the Department of War is funding. Execution risk on integration is real, and the share issuance is meaningful dilution. But the pro forma company Ondas described this morning looks very different from the one investors owned last week.
Take a moment and take a look at other small cap defense companies like Kratos Defense & Security Solutions and V2X.