VirTra's Q2 2025: Unpacking Contradictions in STEP Renewals, IVAS Involvement, and V-XR Demand

STEP renewal rates and customer preferences, IVAS program status and customer involvement, impact of funding uncertainty on bookings, customer traction and market adoption of V-XR, V-XR market demand and grant activity are the key contradictions discussed in VirTra's latest 2025Q2 earnings call



Revenue and Bookings Growth:
- VirTra reported $7 million in total revenue for Q2 2025, a 15% increase year-over-year.
- Bookings for the second quarter totaled $4.6 million, up from $3.6 million in Q2 2024.
- The growth was driven by higher capital deliveries and stable reoccurring revenue from STEP and Service contracts, despite the impact of federal funding delays on order timing.

International Revenue and Market Expansion:
- VirTra's international revenue for Q2 2025 was $1.4 million, representing a 233% increase year-over-year.
- This growth was attributed to increased sales in international markets, with notable activity in recent periods, indicating potential for future expansion.

Operational Improvements and Cost Management:
- The company's net operating expense for Q2 2025 was $3.9 million, an 11% decrease from the previous year.
- The decrease reflects disciplined cost management while maintaining investment in core growth initiatives, contributing to profitability and operational efficiency.

STEP Program Renewals and Recurring Revenue:
- Six customers renewed early in Q2 2025, primarily for the V-180 and V-300 systems, signaling a strong renewal trend.
- The transition to 3-year agreements improved visibility into future recurring revenue, contributing to stability and growth potential.

Product Quality and Market Positioning:
- VirTra's focus on product quality enhancements led to improved hardware durability, reliability, and performance, as reported by customers.
- This has reinforced VirTra's reputation as a trusted long-term training partner, driving repeat business and renewals, and strengthening its market position.