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VirTra Reports Third Quarter and Nine Month 2024 Financial Results

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VirTra reported Q3 2024 financial results with bookings growing 51% quarter-over-quarter to $8.9 million. Total revenue was $7.5 million, slightly down from $7.6 million in Q3 2023. Gross margin improved to 73% from 71% year-over-year. Net income decreased to $0.6 million ($0.05 per diluted share) compared to $1.6 million ($0.15 per diluted share) in Q3 2023. The company maintained strong working capital of $36.0 million and launched V-XR, their new extended reality solution. Operating expenses increased 28% to $4.7 million due to investments in staff and expanded sales efforts.

VirTra ha riportato i risultati finanziari del Q3 2024 con un incremento delle prenotazioni del 51% rispetto al trimestre precedente, raggiungendo 8,9 milioni di dollari. Il totale dei ricavi è stato di 7,5 milioni di dollari, leggermente in calo rispetto ai 7,6 milioni di dollari del Q3 2023. Il margine lordo è migliorato al 73% rispetto al 71% dell'anno precedente. L'utile netto è diminuito a 0,6 milioni di dollari (0,05 dollari per azione diluita) rispetto ai 1,6 milioni di dollari (0,15 dollari per azione diluita) del Q3 2023. L'azienda ha mantenuto un solido capitale circolante di 36,0 milioni di dollari e ha lanciato V-XR, la loro nuova soluzione di realtà estesa. Le spese operative sono aumentate del 28%, raggiungendo 4,7 milioni di dollari a causa degli investimenti nel personale e nel potenziamento degli sforzi di vendita.

VirTra reportó los resultados financieros del Q3 2024 con un crecimiento del 51% en las reservas en comparación con el trimestre anterior, alcanzando 8,9 millones de dólares. Los ingresos totales fueron de 7,5 millones de dólares, un poco menos que los 7,6 millones de dólares del Q3 2023. El margen bruto mejoró al 73% desde el 71% del año anterior. La utilidad neta disminuyó a 0,6 millones de dólares (0,05 dólares por acción diluida) en comparación con 1,6 millones de dólares (0,15 dólares por acción diluida) en el Q3 2023. La compañía mantuvo un sólido capital de trabajo de 36,0 millones de dólares y lanzó V-XR, su nueva solución de realidad extendida. Los gastos operativos aumentaron un 28% alcanzando los 4,7 millones de dólares debido a inversiones en personal y esfuerzos de ventas ampliados.

VirTra는 2024년 3분기 재무 결과를 발표하며 분기 대비 예약이 51% 증가하여 890만 달러에 달했다고 보고했습니다. 총 수익은 750만 달러로, 2023년 3분기의 760만 달러에서 약간 감소했습니다. 총마진은 작년의 71%에서 73%로 개선되었습니다. 순이익은 60만 달러(희석 주당 0.05 달러)로 2023년 3분기의 160만 달러(희석 주당 0.15 달러)와 비교해 감소했습니다. 회사는 3600만 달러의 강력한 운영 자본을 유지하며, 새로운 확장 현실 솔루션 V-XR을 출시했습니다. 운영 비용은 직원 투자 및 영업 노력 확대에 따라 28% 증가하여 470만 달러에 달했습니다.

VirTra a publié ses résultats financiers pour le T3 2024, avec des réservations en hausse de 51 % par rapport au trimestre précédent, atteignant 8,9 millions de dollars. Le chiffre d'affaires total était de 7,5 millions de dollars, légèrement en baisse par rapport à 7,6 millions de dollars au T3 2023. La marge brute a augmenté à 73 % contre 71 % l'année précédente. Le bénéfice net a diminué à 0,6 million de dollars (0,05 dollar par action diluée) contre 1,6 million de dollars (0,15 dollar par action diluée) au T3 2023. L'entreprise a maintenu un capital de travail solide de 36,0 millions de dollars et a lancé V-XR, sa nouvelle solution de réalité étendue. Les dépenses d'exploitation ont augmenté de 28 %, atteignant 4,7 millions de dollars en raison des investissements dans le personnel et des efforts de vente élargis.

VirTra berichtete über die finanziellen Ergebnisse des Q3 2024, wobei die Buchungen im Quartalsvergleich um 51% auf 8,9 Millionen Dollar gestiegen sind. Der Gesamtumsatz betrug 7,5 Millionen Dollar, etwas weniger als die 7,6 Millionen Dollar im Q3 2023. Die Bruttomarge verbesserte sich von 71% im Vorjahr auf 73%. Der Nettogewinn sank auf 0,6 Millionen Dollar (0,05 Dollar je verwässerte Aktie) im Vergleich zu 1,6 Millionen Dollar (0,15 Dollar je verwässerte Aktie) im Q3 2023. Das Unternehmen hielt ein starkes Betriebskapital von 36,0 Millionen Dollar und brachte V-XR, ihre neue Lösung für erweiterte Realität, auf den Markt. Die Betriebskosten stiegen um 28% auf 4,7 Millionen Dollar aufgrund von Investitionen in Personal und erweiterten Vertriebsbemühungen.

Positive
  • Bookings increased 51% QoQ to $8.9 million
  • Gross margin improved to 73% from 71% YoY
  • Strong working capital position of $36.0 million
  • Cash and cash equivalents of $19.7 million
Negative
  • Revenue decreased 1% YoY to $7.5 million
  • Net income declined to $0.6 million from $1.6 million YoY
  • Operating expenses increased 28% to $4.7 million
  • Adjusted EBITDA decreased to $1.1 million from $2.9 million YoY

Insights

VirTra's Q3 results present a mixed picture. While bookings grew impressively by 51% quarter-over-quarter to $8.9 million, revenue slightly declined by 1% to $7.5 million. The expanded gross margin of 73% is a bright spot, but net income dropped significantly to $0.6 million from $1.6 million year-over-year.

The company's strong working capital of $36.0 million and cash position of $19.7 million provide stability, but increased operating expenses and lower profitability metrics warrant attention. The 28% rise in operating expenses to $4.7 million reflects investments in growth initiatives but has impacted bottom-line performance.

The continuing resolution through December 20th and potential election-related budget uncertainties create near-term headwinds, though the growing backlog and improved booking trends suggest potential recovery in 2025.

The launch of V-XR represents a strategic expansion beyond VirTra's core law enforcement and military markets into healthcare and education sectors. This diversification could reduce dependency on government funding cycles and create new revenue streams. The addition of two board members with military and law enforcement expertise strengthens the company's market positioning and regulatory compliance capabilities.

The improved booking trends despite government funding delays indicate strong underlying demand for simulation training solutions. However, the 22% decline in nine-month revenue to $21.7 million highlights the impact of federal budget constraints on contract execution. The company's shift toward service and STEP contracts with higher margins demonstrates effective portfolio management in challenging market conditions.

Q3 Bookings Grow 51% Quarter-Over-Quarter to $8.9 Million, Bringing YTD Total to $17.7 Million

Gross Margin Expands to 73%

CHANDLER, Ariz., Nov. 12, 2024 (GLOBE NEWSWIRE) -- VirTra, Inc. (Nasdaq: VTSI) (“VirTra” or the “Company”), a global provider of judgmental use of force training simulators and firearms training simulators for the law enforcement and military markets, reported results for the third quarter ended September 30, 2024. The financial statements are available on VirTra’s website and here.

Third Quarter 2024 and Recent Operational Highlights:

  • Bookings totaled $8.9 million in Q3 2024, a 51% increase from $5.9 million in Q2 2024, and a 22% year-over-year increase from $7.3 million in Q3 2023. This growth reflects the effectiveness of our enhanced sales approach and improved market conditions.
  • Gross margins improved to 73%, up from 71% in the prior year period.
  • Maintained robust working capital at $36.0 million, positioning the Company for sustained growth and operational agility.
  • Advanced V-XR launch, with initial orders now being accepted and preparation underway for customer deliveries. This new extended reality solution is set to broaden VirTra’s offerings to meet varying budget requirements, providing agencies with greater flexibility and essential tools for de-escalation training. Additionally, V-XR is expected to open avenues into adjacent markets such as healthcare and education, where immersive training is increasingly in demand.
  • Appointed retired U.S. Army Lieutenant General Maria R. Gervais and Georgia POST Executive Director Mike Ayers to the Board of Directors, strengthening VirTra’s expertise in virtual military training and high-impact law enforcement certification.

Third Quarter and Nine Month 2024 Financial Highlights:

 For the Three Months Ended For the Nine Months Ended
All figures in millions, except per share dataSeptember 30, 2024
 September 30, 2023
 % Δ September 30, 2024
 September 30, 2023
 % Δ
Total Revenue$7.5  $7.6  -1%  $21.7  $27.9  -22% 
        
Gross Profit$5.5  $5.4  2%  $16.5  $18.3  -10% 
Gross Margin 73%   71%  N/A   76%   65%  N/A 
        
Net Income$0.6  $1.6  N/A  $3.0  $5.6  N/A 
Diluted EPS$0.05  $0.15  N/A  $0.27  $0.51  N/A 
Adjusted EBITDA$1.1  $2.9  N/A  $4.7  $9.4  N/A 
        

Management Commentary

CEO John Givens stated, “The third quarter marked a positive step toward accelerating sales momentum, with bookings improving to $8.9 million. This increase signals that the sales improvements we initiated in the second half of 2023 are beginning to make their way into our financial results, setting a strong foundation for future growth. Given the longer timelines associated with selling to government customers, this progress is an encouraging start to what we believe will be a steady ramp-up in demand as our strategies continue to take hold.

“We’re tracking macroeconomic factors closely, including December’s budget decisions, as the continuing resolution currently in place only extends funding for federal programs through December 20th. While funds have been allocated, final distribution to our customers may take additional time, especially as priorities may shift following the presidential election. Nonetheless, with a strong pipeline and strategic positioning, we’re optimistic about capitalizing on emerging opportunities as we move through Q4 and into 2025.”

Third Quarter 2024 Financial Results

Total revenue was $7.5 million, compared to $7.6 million in the prior year period. The slight decrease can primarily be attributed to the smaller number of bookings in the previous three quarters due to the temporary funding measures taken by the federal government that delayed many of VirTra’s contracts.

Gross profit totaled $5.5 million (73% of total revenue), compared to $5.4 million (71% of total revenue) in the prior year period. This 2% improvement in gross margin reflects the lower cost of sales. Additionally, a significant portion of total revenue came from the Company’s service and STEP contracts, which have minimal associated costs, further supporting gross margin performance.

Net operating expense was $4.7 million, a 28% increase from $3.7 million in the prior year period. This increase was driven by investments in higher-level staff and expanded sales and marketing efforts to support growth initiatives. Also contributing to the increased operating expenses were enhancements to the Company’s IT infrastructure and compliance measures required for current and future contracts.

Operating income was $0.8 million, compared to $1.7 million in the third quarter of 2023.

Net income was $0.6 million, or $0.05 per diluted share (based on 11.2 million weighted average diluted shares outstanding), compared to net income of $1.6 million, or $0.15 per diluted share (based on 10.9 million weighted average diluted shares outstanding), in the third quarter of 2023.

Adjusted EBITDA, a non-GAAP metric, was $1.1 million, compared to $2.9 million in the third quarter of 2023.

Cash and cash equivalents were $19.7 million at September 30, 2024.

Financial Commentary

CFO Alanna Boudreau stated, “With a solid cash position and strong gross margin profile, we have the financial flexibility to continue supporting growth initiatives, including expanding our product offerings, enhancing sales and marketing capabilities, and investing in technology to improve training outcomes. Ongoing adjustments to our contract terms have strengthened our cash flow and working capital, allowing us to respond quickly to new opportunities and invest in strategic areas that will drive long-term growth.

“Our strong backlog, which includes long-term contracts, reflects continued demand and provides us with a steady revenue foundation. Additionally, targeted investments in talent, IT infrastructure, and sales and marketing have positioned us for growth as we look toward 2025.”

Conference Call

VirTra’s management will hold a conference call today (November 12, 2024) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results. VirTra’s Chief Executive Officer John Givens and Chief Financial Officer Alanna Boudreau will host the call, followed by a question-and-answer period.

U.S. dial-in number: 1-877-407-9208
International number: 1-201-493-6784
Conference ID: 13749298

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 949-574-3860.

The conference call will be broadcast live and available for replay here and via the investor relations section of the Company’s website.

A replay of the call will be available after 7:30 p.m. Eastern time on the same day through August 26, 2024.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13749298

About VirTra, Inc.
VirTra (Nasdaq: VTSI) is a global provider of judgmental use of force training simulators, firearms training simulators for the law enforcement, military, educational and commercial markets. The company’s patented technologies, software, and scenarios provide intense training for de-escalation, judgmental use-of-force, marksmanship, and related training that mimics real-world situations. VirTra’s mission is to save and improve lives worldwide through practical and highly effective virtual reality and simulator technology. Learn more about the company at www.VirTra.com.

About the Presentation of Adjusted EBITDA
Adjusted earnings before interest, income taxes, depreciation, and amortization and before other non-operating costs and income (“Adjusted EBITDA”) is a non-GAAP financial measure. Adjusted EBITDA also includes non-cash stock option expense and other than temporary impairment loss on investments. Other companies may calculate Adjusted EBITDA differently. VirTra calculates its Adjusted EBITDA to eliminate the impact of certain items it does not consider to be indicative of its performance and its ongoing operations. Adjusted EBITDA is presented herein because management believes the presentation of Adjusted EBITDA provides useful information to VirTra’s investors regarding VirTra’s financial condition and results of operations and because Adjusted EBITDA is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in VirTra’s industry, several of which present a form of Adjusted EBITDA when reporting their results. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of VirTra’s results as reported under accounting principles generally accepted in the United States of America (“GAAP”). Adjusted EBITDA should not be considered as an alternative for net income, cash flows from operating activities and other consolidated income or cash flows statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. A reconciliation of net income to Adjusted EBITDA is provided in the following tables:

  For the Three Months Ended  For the Nine Months Ended 
  Sept 30,  Sept 30,  Increase  %  Sept 30,  Sept 30,  Increase  % 
  2024  2023  (Decrease)  Change  2024  2023  (Decrease)  Change 
                         
Net Income (Loss) $583,101  $1,634,790  $(1,051,689)  -64% $3,000,002  $5,607,804  $(2,607,802)  -47%
Adjustments:                                
Provision for income taxes  208,000   244,316   (36,316)  -15%  807,000   1,863,150   (1,056,150)  -57%
Depreciation and amortization  308,924   121,054   187,870   155%  834,494   602,535   231,959   38%
Interest (net)  (55,919)  23,957   (79,876)  -333%  (144,876)  133,377   (278,253)  -209%
EBITDA $1,044,106  $2,024,117   (980,011)  -48% $4,496,620  $8,206,866   (3,710,246)  -45%
Right of use amortization  38,720   843,042   (804,322)      238,213   1,209,397   (971,184)    
                                 
Adjusted EBITDA $1,082,826  $2,867,159  $(1,784,333)  -62% $4,734,833  $9,416,263  $(4,681,430)  -50%
                                 

Forward-Looking Statements

The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sections. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “should,” “could,” “predicts,” “potential,” “continue,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements. All forward-looking statements in this document are made based on our current expectations, forecasts, estimates and assumptions, and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. In evaluating these statements, you should specifically consider various factors, uncertainties and risks that could affect our future results or operations. These factors, uncertainties and risks may cause our actual results to differ materially from any forward-looking statement set forth in the reports we file with or furnish to the Securities and Exchange Commission (the “SEC”). You should carefully consider these risks and uncertainties described and other information contained in the reports we file with or furnish to the SEC before making any investment decision with respect to our securities. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.

Investor Relations Contact:

Matt Glover and Alec Wilson
Gateway Group, Inc.
VTSI@gateway-grp.com
949-574-3860

- Financial Tables to Follow -

 
VIRTRA, INC.
CONDENSED BALANCE SHEETS
(Unaudited)
       
  September 30,  December 31, 
  2024  2023 
  (Unaudited)    
ASSETS        
Current assets:        
Cash and cash equivalents $19,668,455  $18,849,842 
Accounts receivable, net  7,216,751   15,724,147 
Inventory, net  13,911,948   12,404,880 
Unbilled revenue  2,258,930   1,109,616 
Prepaid expenses and other current assets  1,886,148   906,803 
Total current assets  44,942,232   48,995,288 
Long-term assets:        
Property and equipment, net  16,351,433   15,487,012 
Operating lease right-of-use asset, net  478,474   716,687 
Intangible assets, net  560,873   567,540 
Security deposits, long-term  35,692   35,691 
Other assets, long-term  201,670   201,670 
Deferred tax asset, net  3,498,003   3,630,154 
Total long-term assets  21,126,145   20,638,754 
Total assets $66,068,377  $69,634,042 
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
Current liabilities:        
Accounts payable $1,121,558  $2,282,427 
Accrued compensation and related costs  1,906,302   2,221,416 
Accrued expenses and other current liabilities  708,952   3,970,559 
Notes payable, current  230,824   226,355 
Operating lease liability, short-term  192,294   317,840 
Deferred revenue, short-term  4,797,825   6,736,175 
Total current liabilities  8,957,755   15,754,772 
Long-term liabilities:        
Deferred revenue, long-term  3,022,676   3,012,206 
Notes payable, long-term  7,629,800   7,813,021 
Operating lease liability, long-term  308,109   432,176 
Total long-term liabilities  10,960,585   11,257,403 
Total liabilities  19,918,340   27,012,175 
Commitments and contingencies (See Note 11)        
Stockholders’ equity:        
Preferred stock $0.0001 par value; 2,500,000 authorized; no shares issued or outstanding  -   - 
Common stock $0.0001 par value; 50,000,000 shares authorized; 11,242,925 shares issued and outstanding as of September 30, 2024, and 11,107,230 shares issued and outstanding as of December 31, 2023  1,123   1,109 
Class A common stock $0.0001 par value; 2,500,000 shares authorized; no shares issued or outstanding  -   - 
Class B common stock $0.0001 par value; 7,500,000 shares authorized; no shares issued or outstanding  -   - 
Additional paid-in capital  32,485,919   31,957,765 
Accumulated income  13,662,995   10,662,993 
Total stockholders’ equity  46,150,037   42,621,867 
Total liabilities and stockholders’ equity $66,068,377  $69,634,042 
         


 
VIRTRA, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
             
  Three Months Ended September 30,  Nine Months Ended September 30, 
  2024  2023  2024  2023 
             
Revenues:                
Net sales $7,484,269  $7,561,582  $21,653,707  $27,925,420 
Total revenue  7,484,269   7,561,582   21,653,707   27,925,420 
                 
Cost of sales  1,986,296   2,175,508   5,168,978   9,669,708 
                 
Gross profit  5,497,973   5,386,074   16,484,729   18,255,712 
                 
Operating expenses:                
General and administrative  4,017,584   3,229,075   10,925,915   9,220,751 
Research and development  724,757   487,388   2,273,422   1,965,438 
                 
Net operating expense  4,742,341   3,716,463   13,199,337   11,186,189 
                 
Income from operations  755,632   1,669,611   3,285,392   7,069,523 
                 
Other income (expense):                
Other income  35,469   233,521   521,610   625,761 
Other expense  -   (24,026)  -   (224,330)
                 
Net other income  35,469   209,495   521,610   401,431 
                 
Income before provision for income taxes  791,101   1,879,106   3,807,002   7,470,954 
                 
Provision for income taxes  208,000   244,316   807,000   1,863,150 
                 
Net income $583,101  $1,634,790  $3,000,002  $5,607,804 
                 
Net income per common share:                
Basic $0.05  $0.15  $0.27  $0.51 
Diluted $0.05  $0.15  $0.27  $0.51 
                 
Weighted average shares outstanding:                
Basic  11,175,882   10,934,962   10,982,083   10,924,486 
Diluted  11,175,882   10,942,509   10,982,083   10,929,155 
                 


 
VIRTRA, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
       
  Nine Months Ended September 30 
  2024  2023 
       
Cash flows from operating activities:        
Net income (loss) $3,000,002  $5,607,804 
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization  834,494   701,536 
Right of use amortization  238,213   369,772 
Reserve for RSU  508,003   - 
Stock issued for service  12   342,475 
Bad Debt Expense  (154,022)  - 
Changes in operating assets and liabilities:        
Accounts receivable, net  8,661,418   (11,131,628)
Inventory, net  (1,507,068)  (1,183,302)
Deferred taxes  132,151   (3,122,905)
Unbilled revenue  (1,149,314)  4,487,290 
Prepaid expenses and other current assets  (979,345)  (779,538)
Other assets  -   174,791 
Accounts payable and other accrued expenses  (4,737,781)  4,015,047 
Lease liability  (249,614)  (392,103)
Deferred revenue  (1,927,880)  5,276,512 
Net cash provided by operating activities  2,669,269   4,365,751 
         
Cash flows from investing activities:        
Purchase of intangible assets  -   - 
Purchase of property and equipment  (1,692,249)  (512,249)
Net cash (used in) investing activities  (1,692,249)  (512,249)
         
Cash flows from financing activities:        
Principal payments of debt  (178,559)  (177,824)
RSU issued  20,151   41,903 
Net cash used in financing activities  (158,408)  (135,921)
         
Net increase in cash  818,612   3,717,581 
Cash and restricted cash, beginning of period  18,849,843   13,483,597 
Cash and restricted cash, end of period $19,668,455  $17,201,178 
         
Supplemental disclosure of cash flow information:        
Interest Paid $182,419  $- 
Taxes Paid  5,315,442   - 
         

FAQ

What was VirTra's (VTSI) Q3 2024 revenue?

VirTra reported Q3 2024 revenue of $7.5 million, slightly down from $7.6 million in Q3 2023.

How much did VirTra's (VTSI) bookings grow in Q3 2024?

VirTra's bookings grew 51% quarter-over-quarter to $8.9 million in Q3 2024, up from $5.9 million in Q2 2024.

What was VirTra's (VTSI) gross margin in Q3 2024?

VirTra's gross margin improved to 73% in Q3 2024, up from 71% in the prior year period.

What was VirTra's (VTSI) earnings per share in Q3 2024?

VirTra reported earnings of $0.05 per diluted share in Q3 2024, compared to $0.15 per diluted share in Q3 2023.

VirTra, Inc.

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