VirTra (NASDAQ:VTSI) reported second-quarter revenue of $5.8 million, up from $3.5 million in the first quarter but below $7 million in the prior-year period, as the company cited improved conversion of orders into revenue and contributions from international deliveries.
Bookings totaled $5.5 million, compared with $3.8 million in the first quarter, while backlog remained approximately $24.9 million at the end of June. Management said customer demand for its training systems remains intact, though funding awards, procurement approvals and customer acceptance processes continue to affect the timing of revenue recognition.
Funding Activity and Bookings Improve
Givens said the company is seeing signs that previously constrained funding processes are progressing. Multiple grant programs have reopened, customers are submitting applications, and funding allocations are moving through the system, according to management.
During the question-and-answer session, Givens said three grant programs that VirTra had been awaiting since October 2024 had been released. Customers have submitted funding requests, and the company expects grant award lists to be announced. He described the grants as primarily relevant to law-enforcement customers.
The company’s second-quarter bookings included STEP agreements, capital-system orders, renewed federal activity and purchases across its domestic sales territories. Givens said some federal customers resumed purchasing activity after delaying decisions while funding was limited.
VirTra’s backlog included:
- $13.2 million in capital backlog, including simulator systems, accessories, installations, training, custom content and design work;
- $3.8 million in service backlog, primarily extended warranty and support contracts; and
- $7.9 million in STEP subscription contracts.
Management said it replenished much of the backlog converted into revenue during the quarter through new bookings. The company expects additional backlog conversion during the rest of the year, although timing will depend on funding, procurement, installation schedules and customer acceptance timelines.
International Revenue Rises, but Timing Remains Variable
International revenue was $2.2 million in the second quarter, compared with $1.4 million a year earlier. Government revenue totaled $3.5 million, down from $5.4 million in the prior-year quarter.
Givens said the company recognized revenue during the quarter from previously awarded international deployments. However, he cautioned that the international business does not provide consistent results because procurement cycles can be lengthy and subject to geopolitical developments, funding conditions and election-related factors.
“It’s a very lumpy revenue in the international space,” Givens said. He added that international customers may obligate funds through orders before their facilities are ready to receive equipment, delaying installation, training and revenue recognition.
VirTra said it is submitting international proposals more frequently and has seen favorable outcomes in several opportunities. Management also cited demand for training related to unmanned aircraft systems and other mission requirements.
Military Marketplace Acceptance and Orlando Expansion
During the quarter, VirTra was accepted into the U.S. Army’s marketplace in three areas: Weapons Skills Development, Joint Fires Training and Counter-Unmanned Aircraft Systems capabilities. Givens said the acceptance expands the company’s ability to participate in military opportunities, although he said it is too early to predict the timing or size of resulting awards.
The company also acquired an Orlando campus during the quarter. The facility serves as VirTra’s program management office and is located near defense, modeling and simulation organizations in Central Florida. Management said the location should support customer demonstrations, content development, engineering collaboration and program execution. The property also includes tenant leases expected to generate rental income.
VirTra produced approximately 10 new training scenarios during the quarter, a level Givens said was significantly above historical production. The company said the content investment is intended to support current customers, future deployments and booking opportunities.
Margins and Earnings Decline From Prior Year
Second-quarter gross profit was $3.4 million, or 59% of revenue, compared with $4.8 million, or 69% of revenue, in the prior-year period. CFO Alanna Boudreau attributed the margin decline to lower revenue volume and continued investments in content production and product development.
Net operating expense declined to $3.6 million from $3.9 million a year earlier. Still, VirTra recorded a loss from operations of about $0.2 million, compared with operating income of $2.2 million in the prior-year quarter.
The company reported a net loss of $0.3 million, or $0.02 per diluted share, compared with net income of $0.2 million, or $0.02 per diluted share, a year earlier. Adjusted EBITDA was $0.4 million, down from $0.7 million in the prior-year period.
For the first six months of 2026, revenue was $9.2 million, compared with $14.1 million a year earlier, while the net loss was approximately $1.6 million, or $0.14 per diluted share. Cash and cash equivalents were $14.3 million as of June 30, down from $18.6 million at the end of 2025, reflecting inventory investments and the Orlando property acquisition.
Management said it remains focused on helping customers navigate funding and procurement processes while converting its backlog and pipeline into future revenue.
About VirTra (NASDAQ:VTSI)
VirTra, Inc (NASDAQ: VTSI) develops and markets simulation-based training systems designed to enhance decision-making, marksmanship, and judgmental use-of-force skills for law enforcement, military, corrections, and commercial security organizations. The company’s virtual reality–based solutions integrate immersive video, scenario-based engagement, and live firearms training to create realistic, customizable exercises. By combining hardware, software, and content, VirTra aims to deliver comprehensive training environments that replicate real-world challenges faced by frontline professionals.
Key products in VirTra’s portfolio include the V-300 and V-150 immersive training simulators, which offer wraparound projection with touch-screen compatibility for weapon-mounted or handheld controls.
