VirTra, Inc. reported a significant decline in financial performance for the second quarter of 2026, with net sales of $5.76 million, down 17% from $6.98 million in the same period last year. For the first half of 2026, revenues totaled $9.24 million, a decrease of 35% compared to $14.14 million in the first half of 2025. The company attributed this decline primarily to delayed revenue recognition due to temporary customer delivery deferrals, although it noted a strong backlog that supports future revenue conversion as deliveries resume.
The cost of sales increased to $2.35 million for the second quarter of 2026, up 8% from $2.17 million in the prior year, while the total cost of sales for the first half decreased to $3.69 million from $4.13 million. Gross profit for the second quarter was $3.42 million, reflecting a 29% decrease from $4.81 million in 2025, with gross profit margins declining from 69% to 59%. The operating loss for the second quarter was $187,464, a stark contrast to the operating income of $914,366 reported in the same quarter of 2025. For the first half, the operating loss was $1.52 million compared to an operating income of $2.28 million in the previous year.
In terms of strategic developments, VirTra completed the purchase of a property in Orlando, Florida, for $5 million, funded by a combination of cash and a $4 million mortgage. This acquisition is expected to enhance the company's operational capabilities. The company also reported a decrease in total liabilities, which rose to $22.08 million from $19.54 million at the end of 2025, primarily due to increased long-term debt associated with the new mortgage.
Operationally, VirTra's customer base remains concentrated in government-funded sectors, which accounted for 60% of total net sales in the second quarter. The company reported a backlog of $24.9 million as of June 30, 2026, down from $25.6 million at the end of 2025, indicating a slight contraction in future revenue potential. The company continues to focus on cost-control measures and overhead optimization in anticipation of lower revenue levels, with net cash used in operating activities amounting to $2.72 million for the first half of 2026, compared to a cash inflow of $6.05 million in the same period of 2025.
Looking ahead, VirTra's management remains optimistic about future revenue conversion from its backlog and plans to continue expanding its market share through new product offerings and strategic partnerships. However, the company acknowledges the challenges posed by its reliance on government funding and the potential for further delays in revenue recognition.
About VirTra, Inc
VirTra, Inc. designs and manufactures judgmental use-of-force and firearms training simulators for law enforcement, military, and commercial markets. Its products include immersive virtual reality systems, scenario authoring software, and realistic recoil kits, providing safe, effective, and customizable training solutions. The company leverages patented technology, extensive content libraries, and global distribution to enhance decision-making, de-escalation, and marksmanship skills in a competitive industry.
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