Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $7 million, a 15% increase from $6.1 million in the prior year period, driven by higher capital deliveries and stable recurring revenue [11][12] - Gross profit for Q2 was $4.8 million, representing 69% of total revenue, compared to $5.5 million or 91% in the prior year, reflecting a higher mix of capital sales [12][13] - Net income for Q2 was $200,000 or $0.01 per diluted share, down from $1.2 million or $0.10 per diluted share in the prior year [14] - Cash and cash equivalents totaled $20.7 million as of June 30, up from $17.6 million at the end of Q1 [14] Business Line Data and Key Metrics Changes - Government revenue for Q2 was $5.4 million, slightly up from $5.3 million in the prior year [12] - International revenue for Q2 was $1.4 million, significantly up from $600,000 in the prior year [12] - Bookings for Q2 totaled $4.6 million, up from $3.6 million in 2024 but down from $6.4 million in Q1 2025, attributed to timing of awards and customer deferrals [15] Market Data and Key Metrics Changes - The operating environment is influenced by federal and international funding delays, with agency procurement cycles slower than normal [4][10] - The reopening of the Department of Justice COPS grant program is expected to help unlock funding for agencies later in the year [4] Company Strategy and Development Direction - The company is focused on enhancing customer engagement and operational discipline to position itself well for future growth [3][5] - A redesigned website is expected to launch soon, aimed at improving lead capture and conversion tracking [5] - The company is reentering the GSA procurement channel to streamline contracting for eligible agencies [6] Management's Comments on Operating Environment and Future Outlook - Management remains confident in the strength of their solutions and recurring revenue programs despite ongoing funding delays [3][4] - The company expects improved order activity in the coming quarters as funding flows improve [4][10] - The strong cash position and stable recurring revenue base provide a solid foundation for growth in the second half of 2025 [11][17] Other Important Information - The company has made investments to enhance manufacturing processes and quality control, improving product durability and performance [8][9] - The STEP program has transitioned to three-year agreements, improving revenue visibility and customer relationships [17] Q&A Session Summary Question: Clarification on IVAS involvement - Management confirmed that they remain involved in the IVAS program despite changes with Microsoft and Andro, and they expect to produce at a production level [20][21][22] Question: Impact of US Army selecting Bohemia - Management views the selection of Bohemia positively, as it enhances distribution opportunities for VirTra's products [24][25][26] Question: Customer traction with VXR - Management reported strong interest in the VXR platform across various sectors, particularly in healthcare, emphasizing its portability and immersive training capabilities [28][29][30] Question: Changes in STEP renewal rates - Management noted a consistent 95% renewal rate for STEP programs, with some customers renewing early to access new technology [35][36][37] Question: Geographic trends in bookings - Management indicated that while federal funding has been slow, there are emerging opportunities in grants and international markets [41][45]