AeroVironment Inc. was turned down for a phase III contract to continue development of a new unmanned aircraft for use by the U.S. Navy, the company said Tuesday.

The Monrovia company had previously received more than $20 million from the Defense Advanced Research Projects Agency, or DARPA, in 2013 and 2014 to develop a medium-altitude, long-endurance drone that could operate from small ships to provide reconnaissance, intelligence gathering and surveillance.

“We thank DARPA for the opportunity to apply our innovation toward developing a next generation unmanned aircraft system to protect United States Navy personnel,” said Kirk Flittie, vice president and general manager of AeroVironment’s Unmanned Aircraft Systems business segment, in a prepared statement.

AeroVironment designs, manufactures and tests its unmanned aircraft in Simi Valley. The company said that not receiving the phase III contract will have no impact on its stated fiscal year 2016 guidance.

AeroVironment had been working on the aircraft as part of the Tactically Exploited Reconnaissance Node, or TERN, program that would allow the craft to fly with payloads of 600 pounds while operating up to 900 nautical miles from a host vessel.

Shares closed down 94 cents, or 4.7 percent, to $19.25 on the Nasdaq.