Palladyne AI Corp. (NASDAQ: PDYN) announced its subsidiary GuideTech has received a contract from the U.S. Navy to develop the Air-Launched Rapid Response Missile, a near hypersonic weapon system.

The missile is designed to exceed 350 nautical miles flight distance at high altitude with sustained cruise speeds beyond Mach 4.0. The weapon will carry a 150-pound warhead using an air-breathing solid fuel ramjet propulsion system.

The ALRRM aims to deliver hypersonic-level performance at reduced costs compared to existing air-breathing hypersonic weapons, according to the company's press release. The missile is intended for air-launch applications and must meet specific size and weight requirements set by the Navy.

"The 2025 National Security Strategy explicitly states that the U.S. must build 'next-generation missiles with a clear and urgent need for cost-effective, high-performance strike capabilities' for the U.S. military," said Ben Wolff, President and CEO of Palladyne AI.

Palladyne AI develops artificial intelligence solutions, autonomous systems, and precision-manufactured components for defense and industrial markets. The company operates through multiple subsidiaries including GuideTech and Palladyne Defense.

The contract award follows the Department of Defense's emphasis on developing affordable advanced weapons systems without compromising operational capabilities. Financial terms of the Navy contract were not disclosed in the announcement.