VirTra, Inc
For the period ended Jun 30, 2026. Filed Aug 13, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 13, 2026
VTSI$2.67-1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-11.
0001493152-26-022222
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-13.
0001437749-26-027657
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 38 previous paragraphs and 38 current paragraphs.
22 unchanged; 11 reworded; 5 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 11 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (5)
Current report
***Revenues.***Net sales for the three months ended June 30, 2026 were $5,763,358, compared to $6,978,938 for the same period in 2025, representing a decrease of $1,215,580, or 17%. Net sales for the six months ended June 30, 2026 were $9,237,504 compared to $14,139,185 for the same period in 2025, representing a decrease of $4,901,681, or 35%. The decrease was primarily the result of delayed revenue recognition related to temporary customer delivery deferrals. Importantly, backlog remains strong, supporting future revenue conversion as deliveries resume. Additionally, a larger portion of bookings came in at the end of the quarter, which resulted in revenue conversion of these bookings in the third quarter at the earliest. Revenue continues to be affected by our concentration in government-funded customers, including international customers whose purchases are funded through U.S. federal programs. The end of the second quarter was the first time the Company began to see funding start to open up, with a few large orders coming in from our long-term customers that finally had funds released.
Current report
***Cost of Sales.***Cost of sales increased to $2,347,656 for the three months ended June 30, 2026, from $2,166,461 for the same period in 2025, an increased of $181,195, or 8%, primarily due to a few content projects closing out which is charged to cost of goods as they finish and are sent to all customers. Cost of sales decreased to $3,687,998 for the six months ended June 30, 2026, from $4,129,828 for the same period in 2025, a decrease of $441,830, or 11%, primarily due to lower sales volumes. Cost of sales decreased on a year-over-year basis; however, the corresponding reduction was less significant than the decline in revenue, resulting in an increase in cost of sales as a percentage of revenue. This was driven primarily by development and content creation costs that are not directly variable with revenue levels.
Current report
***Operating Expenses.***Net operating expense was $3,603,166 for the three months ended June 30, 2026, compared to $3,898,111 for the same period in 2025, a decrease of $294,945, or 8%. Net operating expense was $7,065,011 for the six months ended June 30, 2026, compared to $7,727,189 for the same period in 2025, a decrease of $662,178, or 9%. Operating expenses decreased during the period as a result of management's continued focus on cost-control measures and overhead optimization in anticipation of lower revenue levels.
Current report
***Operating Income.***Operating loss was ($187,464) for the three months ended June 30, 2026, compared to operating income of $914,366 for the same period in 2025, a decrease of $1,101,830 or 121%. Operating loss was ($1,515,505) for the six months ended June 30, 2026, compared to operating income of $2,282,168 for the same period in 2025, a decrease of $3,797,673 or 166%. The year-over-year decline was driven principally by lower revenues and higher cost of sales, while operating expenses decreased only marginally during the period.
Current report
***Net Other Income.***Other income net of other expense was $14,645 for the three months ended June 30, 2026, compared to net other expense of $748,052 for the same period in 2025, an improvement of $762,697, or 102%. Other income net of other expense was $68,053 for the six months ended June 30, 2026, compared to net other expense of $749,794 for the same period in 2025, an improvement of $817,847 or 109%. The change from expense to income is primarily attributable to a significant foreign exchange (FX) loss recognized in the second quarter of 2025, compared with minimal FX expense and higher interest income in 2026.
Removed paragraphs (5)
Previous report
***Revenues.***Net sales for the three months ended March 31, 2026 were $3,474,146, compared to $7,160,247 for the same period in 2025, representing a decrease of $3,686,101, or 51%. The decrease was primarily driven by a delay in the conversion of backlog to revenue, as several customers associated with third- and fourth-quarter 2025 bookings were unable to accept delivery during the first quarter of 2026. Management expects a significant portion of the December 31, 2025 backlog to convert to revenue over the remainder of fiscal year 2026. In addition, revenue was adversely impacted by the Company’s concentration in government-funded customers, including international customers whose purchases are funded through U.S. federal programs. Timing and funding uncertainties associated with government appropriations contributed to lower shipment volumes during the quarter.
Previous report
***Cost of Sales.***Cost of sales decreased to $1,340,342 for the three months ended March 31, 2026, from $1,963,367 for the same period in 2025, a decrease of $623,025, or 32%, primarily due to lower sales volumes. Despite the overall decrease in cost of sales, year over year, cost of sales increased as a percentage of revenue, as certain development and content creation costs could not be reduced in proportion to the decline in revenues.
Previous report
***Operating Expenses.***Net operating expense was $3,461,845 for the three months ended March 31, 2026, compared to $3,829,077 for the same period in 2025, a decrease of $367,232, or 10%. The decrease in operating expenses for the period results from continuing efforts by the Company to optimize and reduce overhead expenses during times of anticipated revenue declines
Previous report
***Operating Income.***Operating loss was ($1,328,041) for the three months ended March 31, 2026, compared to operating income of $1,367,803 for the same period in 2025, a decrease of $2,695,844 or 197%. This year-over-year decrease is attributable to an increased cost of sales, only marginal declines in operating expenses, and reduced revenues.
Previous report
***Other Income.***Other income net of other expense was $53,409 for the three months ended March 31, 2026, compared to net other expense of $1,743 for the same period in 2025, an increase of $55,152, or 3164%. This was due to the interest earned on cash.
Reworded paragraphs (11)
Previous wording
Results of operations for the three months ended March 31, 2026, and March 31, 2025
Current wording
Results of operations for the three and six months ended June 30, 2026, and June 30, 2025
Previous wording
***Gross Profit.***Gross profit was $2,133,804 for the three months ended March 31, 2026, compared to $5,196,880 for the same period in 2025, a decrease of $3,063,076, or 59%. The gross profit margin for the three months ended March 31, 2026 and 2025 was 61% and 73%, respectively. This decrease in margin is driven by the Company continuing to put out new product and work on integrations with other software, including VBS, which will help drive revenue in the future.
Current wording
***Gross Profit.***Gross profit was $3,415,702 for the three months ended June 30, 2026, compared to $4,812,477 for the same period in 2025, a decrease of $1,396,775, or 29%. Gross profit was $5,549,506 for the six months ended June 30, 2026, compared to $10,009,357 for the same period in 2025, a decrease of $4,459,851, or 45%. The gross profit margin for the three months ended June 30, 2026 and 2025 was 59% and 69%, respectively. The gross profit margin for the six months ended June 30, 2026 and 2025 was 60% and 71%, respectively. This decrease in margin is driven by the Company continuing to work on new scenarios for all our customers and improve our integrations with other software, including VBS and Vialytics, which will help drive revenue.
Previous wording
***Provision (Benefit) for Income Tax.***Provision for income tax was $54,000 for the three months ended March 31, 2026, compared to $102,000 for the same period in 2025, a decrease of $48,000, or 47%. Provision for income tax is estimated quarterly applying both federal and state tax rates.
Current wording
***Provision (Benefit) for Income Tax.***Provision for income tax was $88,439 for the three months ended June 30, 2026, compared to ($9,000) benefit for the same period in 2025, a decrease of $97,439, or 1083%. Provision for income tax was $142,438 for the six months ended June 30, 2026, compared to $93,000 for the same period in 2025, an increase of $49,438, or 53%. Provision for income tax is estimated quarterly applying both federal and state tax rates.
Previous wording
***Net Income.***Net loss was ($1,328,632) for the three months ended March 31, 2026, compared to net income of $1,264,060 for the same period in 2025, a decrease of $2,592,692 or 205%. The fluctuation in net income relates to each respective revenue section discussed above.
Current wording
***Net Income.***Net loss was ($261,258) for the three months ended June 30, 2026, compared to net income of $175,314 for the same period in 2025, a decrease of $436,572 or 249%. Net loss was ($1,589,890) for the six months ended June 30, 2026, compared to net income of $1,439,374 for the same period in 2025, a decrease of $3,029,264 or 210%. The fluctuation in net income relates to each respective revenue section discussed above.
Previous wording
***Liquidity and Capital Resources.***Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. The Company had $17,850,178 and $18,594,598 of cash and cash equivalents as of March 31, 2026, and December 31, 2025, respectively. Working capital was $29,276,508 and $30,793,890 as of March 31, 2026, and December 31, 2025, respectively.
Current wording
***Liquidity and Capital Resources.***Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. The Company had $14,312,743 and $ 18,594,598 of cash and cash equivalents as of June 30, 2026, and December 31, 2025, respectively. Working capital was $28,373,949 and $30,793,890 as of June 30, 2026, and December 31, 2025 respectively.
Previous wording
Net cash used in operating activities was $580,390 and net cash provided by operating activities was $65,691 for the three months ended March 31, 2026 and 2025, respectively. Net cash used in operating activities resulted primarily from the net loss for the period, and increases in inventory which is intentionally done to support future growth.
Current wording
Net cash used in operating activities was $2,720,870 and net cash provided by operating activities was $6,047,430 for the six months ended June 30, 2026 and 2025, respectively. Net cash used in operating activities resulted primarily from the net loss for the period and increases in inventory to support future growth and $1,000,000 used for the Orlando building purchase deposit.
Previous wording
Net cash used in investing activities was $96,875 for the three months ended March 31, 2026, compared to net cash used in investing activities of $428,371 for the three months ended March 31, 2025. Investing activities in 2026 and 2025 consisted of purchases of property and equipment.
Current wording
Net cash used in investing activities was $1,442,859 for the six months ended June 30, 2026, compared to net cash used in investing activities of 3,261,941 for the six months ended June 30, 2025. Investing activities in 2026 and 2025 consisted of purchases of property and equipment.
Previous wording
Net cash used in financing activities was $67,154 for the three months ended March 31, 2026, compared to $65,521 used in the three months ended March 31, 2025. In both periods, cash was used primarily for principal payment of debt.
Current wording
Net cash used in financing activities was $122,116 for the six months ended June 30, 2026, compared to $128,962 used in the six months ended June 30, 2025. In both periods, cash was used primarily for principal payment of debt and in 2026 the creation of the new mortgage note for the purchase of the Orlando building.
Previous wording
The Company defines bookings as the total of newly signed contracts, awarded RFP’s and purchase orders received in a defined time period. The Company received bookings totaling $3.8 million for the three months ended March 31, 2026. The Company has made one change to the booking qualifications. As previously disclosed, in 2024 we strengthened the language in the STEP contract Terms and Conditions to better ensure the agreement remains in effect for the full three-year term. This change was done to secure future revenue and lower our risk of unsigned or cancelled contracts. Therefore, with this change, we believe there are $2.1 million in renewable STEP contract options still outstanding, and based on current renewal rates, the Company believes 95% of those options will be exercised.
Current wording
The Company defines bookings as the total of newly signed contracts, awarded RFP’s and purchase orders received in a defined time period. The Company received bookings totaling $5.5 million for the three months ended June 30, 2026 and bookings totaling $9.3 million for the six months ended June 30, 2026. The Company has made one change to the booking qualifications. As previously disclosed, in 2024 we strengthened the language in the STEP contract Terms and Conditions to better ensure the agreement remains in effect for the full three-year term. This change was done to secure future revenue and lower our risk of unsigned or cancelled contracts. Therefore, with this change, we believe there are $1.7 million in renewable STEP contract options still outstanding, and based on current renewal rates, the Company believes 95% of those options will be exercised.
Previous wording
The Company defines backlog as the accumulation of bookings from signed contracts and purchase orders that are not started, or have uncompleted performance objectives, and cannot be recognized as revenue until delivered in a future quarter. The Company splits the backlog into three categories. The first is capital, which includes sales of all the simulators, corresponding accessories, installs, training custom content and custom design work. The second and third are extended warranty agreements and STEP agreements that are deferred revenue recognized on a straight-line basis over the life of each respective agreement. As of March 31, 2026, the Company’s backlog was $13.2 million in Capital, $4.4 million in Service and $7.6 million in STEP, for a total of $25.2 million. This is a slight decrease in backlog from December 31,2025 which sat at $13.8 million in Capital, $5.1 million in Service and $6.7 million in STEP, for a total of $25.6 million
Current wording
The Company defines backlog as the accumulation of bookings from signed contracts and purchase orders that are not started, or have uncompleted performance objectives, and cannot be recognized as revenue until delivered in a future quarter. The Company splits the backlog into three categories. The first is capital, which includes sales of all the simulators, corresponding accessories, installs, training custom content and custom design work. The second and third are extended warranty agreements and STEP agreements that are deferred revenue recognized on a straight-line basis over the life of each respective agreement. As of June 30, 2026, the Company’s backlog was $13.2 million in Capital, $3.8 million in Service and $7.9 million in STEP, for a total of $24.9 million. This is a decrease in backlog from December 31, 2025 which sat at $13.8 million in Capital, $5.1 million in Service and $6.7 million in STEP, for a total of $25.6 million
Previous wording
Management estimates that most new capital bookings received in the first quarter of 2026 will be converted to revenue in 2026. Management recognizes that there are a percentage of capital contracts that will extend into 2027 by request of the customers. Management’s estimate for the conversion of backlog is based on current contract delivery dates; however, contract terms and install dates are subject to modification and are routinely changed at the request of the customer or due to factors outside the Company’s control.
Current wording
Management estimates that most new capital bookings received in the second quarter of 2026 will be converted to revenue in 2026. Management recognizes that there are a percentage of capital contracts that will extend into 2027 by request of the customers. Management’s estimate for the conversion of backlog is based on current contract delivery dates; however, contract terms and install dates are subject to modification and are routinely changed at the request of the customer or due to factors outside the Company’s control.