Joby adds Saudi evaluation flights, extending Middle East launch footprint

What happened

Joby Aviation signed a memorandum of understanding with Red Sea Global and The Helicopter Company to conduct pre-commercial evaluation flights of its electric air taxi in Saudi Arabia in the first half of 2026. The agreement contemplates Joby working with RSG, a major Saudi tourism and infrastructure developer, and THC, a leading regional rotorcraft operator, to assess routes and operations around flagship destinations such as the Red Sea projects. This builds on Joby’s existing plan to launch early commercial services in Dubai around 2026, reinforcing a strategy of entering markets where regulators and infrastructure partners are highly supportive. While the Saudi flights are framed as pre-commercial evaluations rather than fully contracted services, they signal growing sovereign and tourism-backed interest in Joby’s model and could mature into revenue-generating routes. However, the company remains pre-revenue with accelerating cash burn and still depends on timely certification and manufacturing ramp-up, so the announcement improves strategic positioning more than near-term financial visibility.

Implication

For investors, the Saudi evaluation agreement adds another proof point that Joby can attract well-capitalized, tourism- and infrastructure-focused partners, complementing its Dubai launch plans and the pending Blade passenger-operations acquisition. If these pre-commercial flights convert into contracted services, Joby could benefit from subsidized infrastructure, premium tourist demand, and diversification away from solely U.S. and UAE regulatory timelines, modestly de-risking early revenue. At the same time, the announcement does not resolve core uncertainties around FAA certification, unit economics, or the scale of future capital needs, and it may introduce additional execution complexity as Joby balances multiple international launches. Near-term financial impact is likely minimal given the evaluation framing and 2026 timing, so cash burn and dilution risk remain central to the equity case. Overall, the news supports the strategic narrative of a vertically integrated global operator but does not, on its own, justify a shift away from a wait-and-see stance at current valuation levels.

Thesis delta

The Saudi Arabia MoU slightly strengthens the qualitative side of the Joby thesis by expanding the Middle East launch footprint beyond Dubai and affirming demand from sovereign-backed tourism and aviation partners. However, because the agreement is pre-commercial, long-dated, and does not directly improve visibility on certification timing or unit economics, it does not meaningfully change the balance of risks and rewards embedded in our current HOLD/NEUTRAL stance. We view the development as incrementally positive for long-term optionality and partnership depth, but still insufficient to move to a more constructive rating absent clearer operating and financial milestones.