Steve Fendley, president of Kratos' unmanned systems division, said in a statement published Thursday the exercised option will ensure BQM-177A's continuous production through fiscal year 2023.
"Concurrently, we have been part of the Navy's site activation plan and I couldn't be prouder of the part we played in supporting the first flight at the Pacific Missile Range Facility in Kauai, Hawaii last month," said Fendley.
He added Kratos and the Naval Air Systems Command are close to achieving full operational capability status for the aerial target in FY 2021.
BQM-177A can reach a sea-skimming altitude of 6.6 feet and 0.95 Mach in flight speeds. The aerial target can also carry various payloads such as electronic countermeasures, chaff and flare dispensers.
NAVAIR received the company's 100th BQM-177A production unit in November.