Special Situations Group - #1 Kraken Robotics: The Unsung Hero Powering Global Underwater Drones
Unlocking Kraken's Role in Anduril's Ghost Shark and the Booming AUV Market
Kraken Robotics ($KRKNF) is my “secret winner” behind Anduril’s massive A$1.7B Ghost Shark deal with Australia. My thread on X went viral, racking up over 46,000 views and sparking discussions on defense tech, supply chains, and hidden gems in the AUV (Autonomous Underwater Vehicle) space. X - Thread
Since then, things have moved fast. Anduril’s Ghost Shark factory in Sydney is now operational, with the first vehicle rolling off the line. Kraken has announced fresh $12M orders for sonar and batteries, plus key executive hires signaling a defense pivot. I’ve updated my analysis with a new table breaking down Kraken’s tech integrations across major players—from Anduril to Teledyne and beyond. Let’s dive in (pun intended) and explore why Kraken remains a compelling play in the booming underwater autonomy market.
The Original Thesis: Kraken as Anduril’s Mission-Critical Partner
To recap: Anduril’s Ghost Shark is an extra-large AUV designed for stealthy, long-range missions—think surveillance, mine countermeasures, and anti-submarine warfare. In 2022, Anduril acquired Dive Technologies, which had already embedded Kraken’s specialized tech: pressure-tolerant SeaPower batteries and AquaPix Synthetic Aperture Sonar (SAS).
Why does this matter? Anduril, known for in-house innovation, chose to keep Kraken’s components in the Ghost Shark. This isn’t just a supplier deal; it’s validation that Kraken’s batteries (which handle extreme depths without heavy pressure vessels) and sonar (providing high-res sonar imaging) are best-in-class. The Ghost Shark’s “flooded hull” design relies on this tech to achieve its endurance and stealth.
The Australian contract: A 5-year, A$1.7B (~$1.12B USD) program for delivery, maintenance, and development. My model estimated 25-45 units, with each carrying $8M-$10.5M in Kraken tech—translating to $225M-$473M in revenue for Kraken. For context, Kraken’s 2024 revenue was ~$91M CAD, so this is transformational.
Recent Updates: Factory Launch, New Orders, and Defense Push
Fast-forward to now: Anduril officially opened its state-of-the-art Ghost Shark facility in Sydney on November 2, 2025, with the first vehicle already off the line. This ramps up production, and Anduril’s U.S. factories (e.g., Rhode Island) are scaling too—targeting 200 Dive-LD units annually, all embedding Kraken batteries and sonar.
Kraken isn’t standing still:
December 2, 2025: Announced $12M in orders for SAS and subsea batteries. While not explicitly tied to Anduril, this aligns with rising demand from defense and commercial clients.
December 4, 2025: Appointed Kim Butler (experienced in tech governance) to the Board and hired Bernard Mills as EVP of Defense. Mills brings expertise from subsea and autonomy sectors, signaling Kraken’s strategic shift toward military contracts.
And just yesterday (December 5, 2025), Anduril posted an impressive update on X (@anduriltech): “More mission miles than the circumference of the Earth. Anduril’s autonomous undersea vehicles have accumulated over 40,100km and 6350hrs of mission time. There’s no substitute for live ops. Only by proving, breaking, and hardening our systems in real operational conditions can we deliver technology that performs reliably when it matters most.”
The post includes a mesmerizing underwater video capturing an AUV dive in action; along with photos highlighting their tech. This milestone underscores the real-world reliability of systems like Ghost Shark—powered by Kraken’s components—and hints at even more demand as Anduril pushes for global adoption. (View the full post here: https://x.com/anduriltech/status/1997048733696250351)
These moves reinforce Kraken’s role in the AUV ecosystem. With global navies (U.S., Australia, allies) eyeing hundreds of Ghost Shark-like units, Kraken’s high-switching-cost tech positions it for recurring revenue—and potentially as an acquisition target for Anduril to secure its supply chain.
Who Does Kraken Supply? A Comprehensive Breakdown
Kraken’s tech isn’t limited to Anduril. Their batteries and sonar power a who’s who of underwater systems worldwide. Here’s an updated table based on public data and my estimates (logical guesstimates for revenue per system—actuals may vary based on configs). Prices are in USD; rev assumes Kraken captures 20-30% of system value via key components.
Notes: “Above is logical guesstimate.” Made by Jordi (assuming a source credit). This table expands on my original model, showing Kraken’s footprint across 10+ primes and systems. Total addressable market? Billions, as navies ramp AUV fleets amid geopolitical tensions (e.g., South China Sea, Arctic).
Modeling the Revenue Potential
Building on the table:
Per-Unit Impact: Kraken’s batteries/sonar often comprise 20-30% of an AUV’s value, given their criticality for endurance and sensing.
Fleet Scaling: Anduril’s Sydney/Rhode Island lines could produce 200+ Dive-LD/Ghost Shark units/year. If 50% embed full Kraken suites, that’s $400M-$600M annual rev potential for Kraken from Anduril alone.
Broader Ecosystem: Add Teledyne’s Gavia/SeaRaptor (dozens deployed), Hill’s REMUS (U.S. Navy staple), and emerging players like Hanwha—Kraken’s pipeline could hit $1B+ over 5 years.
Q3 2025 Earnings Context: Kraken recently raised 2025 CapEx 50% to expand battery production, prepping for Anduril’s ramp. Q3 rev was strong, with defense up 40% YoY.
Risks? Supply chain bottlenecks, competition (e.g., from in-house tech), or delays in contracts. But with Anduril’s backing and Kraken’s IP moat, the upside skews positive.
Why $KRKNF Now? The Big Picture
Kraken isn’t just a supplier—it’s a proxy for the underwater drone revolution. As AUVs become the “drones of the sea,” demand for their tech surges. With recent hires and orders, Kraken is pivoting hard into defense (now 60% of rev).
This makes $KRKNF a speculative bet on Anduril’s growth (without the private valuation premium) and a potential M&A target. Watch for U.S. Navy contracts or further Anduril integrations.
Final Thoughts
The underwater domain is heating up, and Kraken is quietly powering the leaders. If you’re into quantitative-driven defense plays, add $KRKNF to your watchlist. For more models and updates, subscribe below:
What do you think—bullish on Kraken, or waiting for a dip? Drop a comment!
Disclosure: I hold a position in $KRKNF. This is not financial advice; do your own research.
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