The U.S. Department of War's Office of Strategic Capital signed a conditional loan commitment of up to $450 million with Neros, Inc. on November 2, 2026, to expand the California drone maker's manufacturing capacity nearly sixteen-fold by 2028. Neros is pairing the loan with $165 million of its own equity, bringing total investment in its Torrance factory to $615 million.
The financing will fund vertically integrated production of first-person-view drones and the parts that go into them, including ground control systems, motors, radios, flight electronics, sensors and batteries. Neros plans to source components domestically and from allied countries, and to sell parts to other American and allied drone manufacturers rather than keep its supply chain closed to outside buyers.
Closing the gap with China
Neros says it already produces more lethal first-person-view drones than any other U.S. company, at a rate of about 62,000 units a year, or roughly 1,200 a week, as of August 2026. CEO and co-founder Soren Monroe-Anderson said the new capital puts Neros "on the path to one million drones per year by 2028," a jump that would require scaling output sixteen-fold in just two years. The company built its reputation supplying low-cost, attritable FPV drones, the kind an operator flies by watching a live video feed from an onboard camera, to military customers who need large volumes rather than a handful of expensive, highly engineered systems.
The loan is tied directly to President Trump's executive order "Unleashing American Drone Dominance," part of a wider Pentagon effort to cut U.S. and allied reliance on Chinese-made drone hardware, particularly components from firms that have long dominated global supply chains. James R. Shanahan, senior managing director at the Office of Strategic Capital, said the country needs manufacturers that can build complete drone systems "at competitive prices for both military and non-military applications," signaling that the office views manufacturing scale, not just battlefield performance, as the real bottleneck.
How it compares to other Pentagon drone bets
The Neros deal arrives alongside a string of other government investments meant to rebuild domestic drone and counter-drone industries. The Army has awarded more than $4 billion in counter-drone contracts over the past year, and AeroVironment separately won a roughly $465 million contract to build a high-energy laser system designed to shoot down enemy drones. Neros's own loan follows its participation in the Pentagon's $1.1 billion drone competition, a program meant to identify domestic manufacturers capable of mass-producing small unmanned systems quickly.
What sets this loan apart is its focus on manufacturing infrastructure rather than a single weapons order. The money goes toward machines, tooling and supply chains instead of a fixed number of drones, which means Neros's ability to hit its targets depends on factory execution rather than a guaranteed purchase order. That is a different kind of bet than a traditional defense contract, and a riskier one if production ramps slower than projected.
The loan remains conditional, subject to financial, legal and technical due diligence before it closes. If it clears those hurdles, it would mark one of the largest single commitments yet under the administration's push to rebuild domestic drone manufacturing, and a real test of whether a four-year-old startup can multiply its output sixteen times over in two years.