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VirTra, Inc. (VTSI) gave investors a reason to celebrate Friday morning. The firearms training simulator provider reported better-than-expected third-quarter 2026 results, and the stock surged in premarket trading as a result.
Revenue jumped 42% year over year to $7.6 million, easily beating the analyst estimate of $4.39 million. Higher government and international sales drove the growth.
VirTra reported GAAP earnings of 19 cents per diluted share, beating the analyst forecast of a 3-cent loss. A year earlier, the company posted a loss of 3 cents per share.
Net income reached $2.2 million, compared with a $400,000 loss in the year-ago quarter.
Gross profit rose 52% to $5.3 million, while gross margin improved to 70% from 66%.
Operating income reached $2 million, reversing a $500,000 operating loss a year earlier. Operating expenses fell to $3.3 million from $4 million.
Adjusted EBITDA climbed to $2.6 million from about $91,000.
Third-quarter bookings surged 87% to $10.3 million from $5.5 million in the previous quarter.
VirTra ended September with a $27.6 million backlog. This included $14.1 million in capital contracts, $3.9 million in service contracts, and $9.6 million in STEP contracts.
Recent wins included a five-year agreement with U.S. Customs and Border Protection worth up to $14 million.
The company also secured a $1.5 million U.S. Army contract to support firearms training in Tajikistan.
VirTra continued expanding its military business through participation in the U.S. Army Marketplace.
Despite the quarterly rebound, revenue for the first nine months fell 13% to $16.9 million due to delayed customer deliveries.
Net income declined to $600,000, or 5 cents per diluted share, from $1.1 million, or 9 cents per share.
Adjusted EBITDA dropped 13% to $2.2 million.
VirTra ended September with $18.4 million in cash.
During Thursday's earnings call, CEO John F. Givens said government funding conditions were improving after nearly two years of limited grant activity.
He said expansion into new markets had strengthened VirTra's sales pipeline.
"We've expanded into other areas, so we've actually increased our pipeline," Givens said.
However, customer readiness continues to delay revenue recognition.
"Our large challenge is that we're able to get the products out quickly, but the customers aren't ready for them," he said.
Givens remained confident about replenishing the backlog despite uncertain deployment schedules.
CFO Alanna Boudreau expects more backlog conversion in the fourth quarter. However, procurement, installation, and customer acceptance timelines remain uncertain.
VirTra continues to control costs while pursuing profitable growth.
VTSI Price Action: VirTra shares were up 31.13% at $3.43 during premarket trading on Friday, according to market data.
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