Palladyne AI Awarded U.S. Army Contracts for SwarmOS™ Autonomous Swarm Technology and Gremlin-X™ Mini-Bomber UAV Under Competitive Disruptive Applications Program

Competitive Army Selection Puts SwarmOS and Gremlin-X in the Hands of Warfighters Across Multiple Operational Exercises

Palladyne AI (NASDAQ:PDYN), a U.S.-based defense and industrial technology company delivering embodied AI-powered collaborative autonomy solutions, advanced avionics, precision-manufactured components, UAVs, and advanced aerospace engineering services, today announced it has been awarded a pair of contracts to research, develop, and operationally validate SwarmOS and Gremlin-X with U.S. Army warfighters, competitively selected under the Army's Disruptive Applications Broad Agency Announcement.

"The hardest problem in autonomous systems isn't making one platform smart, it's making heterogeneous platforms from different manufacturers collaborate intelligently without dependence on centralized infrastructure that adversaries can target and defeat," said Dr. Denis Garagic, Chief Technology Officer and Principal Investigator, Palladyne AI. "We solved that. SwarmOS operates on edge hardware in the field in degraded and denied communications environments. These contracts take that proven capability into Army operational validation."

SwarmOS is Palladyne AI's edge AI autonomy and collaborative autonomy software stack that enables a single operator to command an entire team of autonomous unmanned systems from multiple manufacturers simultaneously—a cross-platform, decentralized capability protected by Palladyne AI's patent portfolio.

GuideTech is advancing Gremlin-X (formerly Banshee) as a low-cost, reusable Group 2 strike UAS designed to provide small, dispersed formations with an affordable means to engage time-critical targets without requiring centralized control, exquisite communications, or expendable airframes per strike.

Gremlin-X is a reusable but attritable multirotor UAV designed to deliver munitions with precision in denied, degraded, intermittent, and limited (DDIL) environments. In operation, Gremlin-X is an autonomous loitering munition that can return for reuse. Because the airframe is recovered, recurring cost per strike is driven primarily by the munition rather than the platform, a meaningful advantage over traditional loitering munitions.

Under the contract, Palladyne AI will demonstrate SwarmOS and Gremlin-X across a series of U.S. Army 4th Infantry Division (4ID) exercises in Colorado and California. These engagements will evaluate SwarmOS in direct support of 4ID Reconnaissance and Target Acquisition mission requirements, operating on Army-specified platforms via the Android Team Awareness Kit (ATAK), the Army's widely deployed command-and-control interface.

Northern Strike 26-2 represents another major demonstration milestone of our capabilities. Palladyne AI will demonstrate SwarmOS, IntelliSwarm™, and Gremlin-X at this premier Department of War joint exercise, involving more than 9,000 participants. For full details on the planned demonstration, see here.

"This contract marks a decisive shift in how the U.S. Army is engaging with autonomous systems, moving from evaluation to funded operational use in the field," said Doug Dynes, President of Palladyne Aerospace and Defense. "The 4ID experimentation program puts our technology directly in the hands of warfighters across multiple venues and mission sets. Northern Strike 26-2 will bring that validation into a joint exercise environment for the first time. For Palladyne AI, this will demonstrate our ability to be a trusted supplier of proven autonomy solutions and opens a strong pathway toward programs of record."

With validated technology and an Army-awarded contract, Palladyne AI enters the second half of 2026 with clear visibility toward its next phase of defense contracts. For more information, please visit https://www.palladyneai.com.

About Palladyne AI

Palladyne AI is a U.S.-based technology company developing patented embodied artificial intelligence, collaborative autonomy solutions, and autonomous systems for defense and industrial markets. Palladyne AI delivers secure, American-developed and operated platforms designed to meet the stringent requirements of U.S. government and public-sector customers, including data sovereignty, security, and compliance.

Palladyne AI's embodied AI is designed to operate in complex, contested, and high-risk environments, enabling distributed tasking, human-on-the-loop decision-making, degraded-communications resilience, and multi-domain coordination. Its platform-agnostic autonomy stack combines real-time sensor fusion, adaptive AI models, and edge-native orchestration to support autonomous and collaborative systems across air, ground, maritime, and industrial domains. For more information about Palladyne AI, including GuideTech and Palladyne Aerospace & Defense, please visit www.palladyneai.com.

Palladyne Aerospace & Defense

Palladyne Aerospace & Defense is Palladyne AI's division positioned as a mid-tier U.S. technology prime defense contractor. Palladyne Aerospace & Defense bridges innovative autonomy, practical engineering, and American production to bring intelligent systems into active service — faster, safer, and more cost-effectively than legacy approaches. With U.S.-based manufacturing, Palladyne Aerospace & Defense delivers software, components, subsystems, and complete loitering munition systems aligned with the Department of War's growing demand for cost-effective, rapidly deployable, and domestically produced defense technologies.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related Palladyne AI's participation in Northern Strike 26-2 and future 4ID exercises; future development of Gremlin-X and its expected capabilities; potential for future contracts and programs of record; and the expected benefits and capabilities of IntelliSwarm and SwarmOS. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. These statements may be preceded by, followed by, or include the words "believes," "estimates," "expects," "projects," "forecasts," "may," "will," "should," "seeks," "plans," "scheduled," "anticipates," "intends" or "continue" or similar expressions. Such forward-looking statements involve risks and uncertainties that may cause actual events, results, or performance to differ materially from those indicated by such statements. Forward-looking statements speak only as of the date they are made, and Palladyne AI is not under any obligation and expressly disclaims any obligation to update, alter, or otherwise revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

Readers should carefully review the statements set forth in the reports which Palladyne AI has filed or will file from time to time with the Securities and Exchange Commission (the "SEC"), in particular the risks and uncertainties set forth in the sections of those reports entitled "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements," for a description of risks facing Palladyne AI and that could cause actual events, results, or performance to differ from those indicated in the forward-looking statements contained herein. The documents filed by Palladyne AI with the SEC may be obtained free of charge at the SEC's website at www.sec.gov.

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Palladyne AI Investor Contact:

Brian S. Siegel, IRC®, M.B.A.

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(346) 396-8696

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IR@palladyneai.com

Palladyne AI Press Contact:

Heath Meyer

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PR@palladyneai.com