Wrap Technologies 2025 Q3 Earnings Sharp Earnings Decline Amid Revenue Surge

Wrap Technologies (WRAP) reported Q3 2025 earnings on Nov 14, 2025, with revenue surging 235% to $1.45 million but net income plunging to a $2.77 million loss, a 239.3% deterioration from 2024. The stock rose 14.15% in the latest session, reflecting mixed investor sentiment.

Revenue

Wrap Technologies’ total revenue surged 235% to $1.45 million in Q3 2025, driven by robust product sales of $1.74 million and managed services revenue of $242,000. Technology-enabled services contributed $37,000, while sales returns and allowances reduced total revenue by $531,000. The company’s shift toward recurring revenue models, including subscription-based services, underpinned growth in higher-margin system sales.

Earnings/Net Income

The company swung to a loss of $0.06 per share in Q3 2025, a 250% negative change from a $0.04 profit in 2024 Q3. Net income declined to a $2.77 million loss, a 239.3% deterioration from a $1.99 million profit. Despite revenue growth, rising operating expenses and cost pressures exacerbated the loss, underscoring challenges in achieving profitability.

Post-Earnings Price Action Review

The strategy of buying WRAP shares on revenue growth announcements and holding for 30 days yielded cumulative returns of 241.8%, outperforming the S&P 500’s 40% gain over three years. This highlights strong investor confidence in Wrap’s innovation and market positioning. However, risks remain as past performance does not guarantee future results, and market conditions could shift.

CEO Commentary

CEO Scot Cohen emphasized Q3 as the “strongest in the past 2 years,” citing $2 million in gross revenue and 12% subscription sales growth. He highlighted BolaWrap’s 92% field success rate and declining use of lethal tools like TASER. President and COO Jared Novick outlined a strategic pivot to a recurring revenue model, integrating training, policy, and tools. The CEO expressed cautious optimism, noting, “Our systems are working, and our strategy is gaining traction.”

Guidance

Management expects continued momentum in subscription sales and margin expansion, with a focus on federal, defense, and international markets. While no specific revenue targets were provided, Cohen stated, “We’re anticipating doing some real business down there [Chile] next year.” The company aims to reduce operating losses through disciplined cost management and scaling high-margin solutions.

Additional News

Wrap Technologies partnered with K-Form Inc. to enhance U.S. manufacturing for non-lethal tools and VR training systems. CEO Scot Cohen and President Jared Novick sold shares totaling $126,667 and $126,666, respectively, in August 2025. The company also confirmed ongoing negotiations for a Chile deal, with potential contracts expected in 2026.