VTSI Virtra Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2024

 

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____________ to ______________

 

Commission file number: 001-38420

 

VIRTRA, INC.

(Exact name of registrant as specified in its charter)

 

Nevada		93-1207631
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

 

295 E. Corporate Place, Chandler, AZ		85225
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (480) 968-1488

 

N/A

(Former name, former address, and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		VTSI		Nasdaq Capital Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large, accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large, accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

 

As of May 3 2024, the registrant had 11,109,730 shares of common stock outstanding.

 

 

 

TABLE OF CONTENTS

 

				PAGE NO.
PART I	FINANCIAL INFORMATION
	Item 1.	Financial Statements (Unaudited)		F-1
		Condensed Balance Sheets as of March 31, 2024 and December 31, 2023		F-1
		Condensed Statements of Operations for the Three Months ended March 31, 2024 and 2023		F-2
		Condensed Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2024 and 2023		F-3
		Condensed Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023		F-4
		Notes to the Unaudited Financial Statements		F-5
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		3
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		9
	Item 4.	Controls and Procedures		9
PART II	OTHER INFORMATION
	Item 1.	Legal Proceedings		9
	Item 1A.	Risk Factors		9
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		9
	Item 3.	Defaults Upon Senior Securities		9
	Item 4.	Mine Safety Disclosures		9
	Item 5.	Other Information		10
	Item 6.	Exhibits		10
	SIGNATURES			11

 

 

PART I: FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

 

VIRTRA, INC.

CONDENSED BALANCE SHEETS

(unaudited)

 

		March 31, 2024				December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents		$	22,415,177			$	18,849,842
Accounts receivable, net			10,300,165				15,724,147
Inventory, net			12,292,460				12,404,880
Unbilled revenue			1,681,375				1,109,616
Prepaid expenses and other current assets			832,712				906,803
Total current assets			47,521,889				48,995,288
Long-term assets:
Property and equipment, net			16,799,459				15,487,012
Operating lease right-of-use asset, net			588,794				716,687
Intangible assets, net			565,318				567,540
Security deposits, long-term			35,691				35,691
Other assets, long-term			201,670				201,670
Deferred tax asset, net			3,663,357				3,630,154
Total long-term assets			21,854,289				20,638,754
Total assets		$	69,376,178			$	69,634,042
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	1,695,042			$	2,282,427
Accrued compensation and related costs			2,176,078				2,221,416
Accrued expenses and other current liabilities			4,382,361				3,970,559
Note payable, current			226,655				226,355
Operating lease liability, short-term			323,038				317,840
Deferred revenue, short-term			5,538,525				6,736,175
Total current liabilities			14,341,699				15,754,772
Long-term liabilities:
Deferred revenue, long-term			3,004,418				3,012,206
Note payable, long-term			7,751,585				7,813,021
Operating lease liability, long-term			289,687				432,176
Total long-term liabilities			11,045,690				11,257,403
Total liabilities			25,387,389				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; 11,109,730 shares issued and outstanding as of March 31, 2024 and 11,107,230 shares issued and outstanding as of December 31, 2023			1,110				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			-				-
Common stock value			-
Additional paid-in capital			32,108,513				31,957,765
Retained earnings			11,879,166				10,662,993
Total stockholders’ equity			43,988,789				42,621,867
Total liabilities and stockholders’ equity		$	69,376,178			$	69,634,042

 

See accompanying notes to unaudited condensed financial statements.

 

 

VIRTRA, INC.

CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

		Three Months Ended
		March 31, 2024				March 31, 2023
Revenues:
Net sales		$	8,094,398			$	10,026,935
Total revenue			8,094,398				10,026,935
Cost of sales			2,632,257				3,077,997
Gross profit			5,462,141				6,948,938
Operating expenses:
General and administrative			3,370,422				2,711,337
Research and development			693,380				766,296
Net operating expense			4,063,802				3,477,633
Income from operations			1,398,339				3,471,305
Other income:
Other income			329,271				183,642
Gain on forgiveness of note payable			-				(67,229	)
Other income			-				-
Net other income			329,271				116,413
Income before provision for income taxes			1,727,610				3,587,718
Provision for income taxes			511,437				641,345
Net income		$	1,216,173			$	2,946,373
Net income per common share:
Basic		$	0.11			$	0.27
Diluted		$	0.11			$	0.27
Weighted average shares outstanding:
Basic			10,959,298				10,917,311
Diluted			10,961,188				10,919,391

 

See accompanying notes to unaudited condensed financial statements.

 

 

VIRTRA, INC.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

 

		For the Three Months Ended March 31, 2024
		Preferred Stock								Common Stock								Additional Paid-In				Treasury				Accumulated
		Shares				Amount				Shares				Amount				Capital				Stock				Earnings				Total
Balance at December 31, 2023			-			$	-				11,107,230			$	1,109			$	31,957,765			$	-			$	10,662,993			$	42,621,867
Stock options exercised			-				-				2,500				1				10,749				-				-				10,750
Stock reserved for future services			-				-				-				-				139,999				-				-				139,999
Net income			-				-				-				-				-				-				1,216,173				1,216,173
Balance at March 31, 2024			-			$	-				11,109,730			$	1,110			$	32,108,513			$	-			$	11,879,166			$	43,988,789

 

		For the Three Months Ended March 31, 2023
		Preferred Stock								Common Stock								Additional Paid-In				Treasury				Accumulated
		Shares				Amount				Shares				Amount				Capital				Stock				Earnings				Total
Balance at December 31, 2022			-			$	-				10,900,759			$	1,089			$	31,420,395			$	-			$	2,260,135			$	33,681,619
Balance			-			$	-				10,900,759			$	1,089			$	31,420,395			$	-			$	2,260,135			$	33,681,619
Stock options exercised			-				-				7,500				1				16,725				-				-				16,726
Stock issued for services			-				-				16,015				1				74,999				-				-				75,000
Stock reserved for future services			-				-				-				-				24,063				-				-				24,063
Net income			-				-				-				-				-				-				2,946,373				2,946,373
Balance at March 31, 2023			-			$	-				10,924,274			$	1,091			$	31,536,182			$	-			$	5,206,508			$	36,743,781
Balance			-			$	-				10,924,274			$	1,091			$	31,536,182			$	-			$	5,206,508			$	36,743,781

 

See accompanying notes to unaudited condensed financial statements.

 

 

VIRTRA, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		2024				2023
		Three Months Ended March 31
		2024				2023
Cash flows from operating activities:
Net income		$	1,216,173			$	2,946,373
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			236,547				227,570
Right of use amortization			127,893				121,774
Employee stock compensation			139,999				24,063
Bad Debt Expense			245,089
Stock issued for service			-				75,000
Changes in operating assets and liabilities:
Accounts receivable, net			5,178,893				(1,686,838	)
Inventory, net			112,420				(1,155,466	)
Deferred taxes			(33,203	)			(865,745	)
Unbilled revenue			(571,759	)			(430,488	)
Prepaid expenses and other current assets			74,091				(1,675	)
Other assets			-				(792	)
Accounts payable and other accrued expenses			(246,905	)			1,610,884
Operating lease right of use			(137,291	)			(126,592	)
Deferred revenue			(1,205,438	)			240,535
Net cash provided by operating activities			5,136,509				978,603
Cash flows from investing activities:
Purchase of property and equipment			(1,546,772	)			(163,441	)
Net cash (used in) investing activities			(1,546,772	)			(163,441	)
Cash flows from financing activities:
Principal payments of debt			(35,152	)			(57,750	)
Proceeds from Stock based options			10,750				16,726
Net cash (used in) financing activities:			(24,402	)			(41,024	)
Net increase in cash			3,565,335				774,138
Cash and restricted cash, beginning of period			18,849,842				13,483,597
Cash and restricted cash, end of period		$	22,415,177			$	14,257,735
Supplemental disclosure of cash flow information:
Cash paid:
Income taxes paid		$	24,002			$	108,777
Interest paid		$	61,552			$	3,345

 

See accompanying notes to unaudited condensed financial statements.

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Note 1. Organization and Significant Accounting Policies

 

Organization and Business Operations

 

VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” or “our”), located in Chandler, Arizona, is a global provider of judgmental use of force training simulators and 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. The Company sells its products worldwide through a direct sales force and international distribution partners. The original business started in 1993 as Ferris Productions, Inc and ultimately became VirTra, Inc., a Nevada corporation.

 

Basis of Presentation

 

The unaudited financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on April 1, 2024. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading.

 

The accompanying unaudited financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position on March 31, 2024, and the results of our operations and cash flows for the periods presented. We derived the December 31, 2023, balance sheet data from audited financial statements; however, we did not include all disclosures required by GAAP.

 

Interim results are subject to seasonal variations, and the results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the full year.

 

Use of Estimates

 

The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets and intangible assets, income tax valuation allowances, and the allocation of the transaction price to the performance obligations in our contracts with customers.

 

Revenue Recognition

 

The Company adopted the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customer (Topic 606) (“ASC 606”) on January 1, 2018, and the Company elected to use the modified retrospective transition method which requires application of ASC 606 to uncompleted contracts at the date of adoption. The adoption of ASC 606 did not have a material impact on the financial statements.

 

Under ASC 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant judgment is necessary when making these determinations.

 

F-5

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

The Company’s primary sources of revenue are derived from simulator and accessories sales, training and installation, the sale of customizable software and the sale of extended service-type warranties. The Company’s policy is to typically invoice upon completion of installation and/or training until such a time the performance obligations that have been satisfied are included in unbilled. Sales discounts are presented in the financial statements as reductions in determining net revenues. Credit sales are recorded as current assets (accounts receivable and unbilled revenue). Prepaid deposits received at the time of sale and extended warranties purchased are recorded as current and long-term liabilities (deferred revenue) until earned. The following briefly summarizes the nature of our performance obligations and method of revenue recognition:

 

Performance Obligation		Method of Recognition
Simulator and accessories		Upon transfer of control
STEP Program		Deferred and recognized over the life of the contract
Installation and training		Upon completion or over the period of services being rendered
Extended service-type warranty		Deferred and recognized over the life of the extended warranty
Customized software and content		Upon transfer of control or over the period services are performed depending on the terms of the contract
Customized content scenario		As performance obligation is transferred over time (input method using time and materials expanded)
Design and prototyping		Recognized at the completion of each agreed upon milestone
Sales-based royalty exchanged for license of intellectual property		Recognized as the performance obligation is satisfied over time – which is as the sales occur.

 

The Company recognizes revenue upon transfer of control or upon completion of the services for the simulator and accessories; for the installation and training and customized software performance obligations as the customer has the right and ability to direct the use of these products and services and the customer obtains all of the remaining benefit from these products and services at that time. Revenue from certain customized content contracts may be recognized over the period the services are performed based on the terms of the contract. For the sales-based royalty exchanged for license of intellectual property, the Company recognized revenue as the sales occur over time.

 

The Company recognizes revenue on a straight-line basis over the period of services being rendered for the extended service-type warranties as these warranties represent a performance obligation to “stand ready to perform” over the duration of the warranties. As such, the warranty service is performed continuously over the warranty period.

 

Each contract states the transaction price. The contracts do not include variable consideration, significant financing components or noncash consideration. The Company has elected to exclude sales and similar taxes from the measurement of the transaction price. The contract’s transaction price is allocated to the performance obligations based upon their stand-alone selling prices. Discounts on the stand-alone selling prices, if any, are allocated proportionately to each performance obligation.

 

F-6

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Disaggregation of Revenue

 

Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation.

 Schedule of Disaggregation of Revenue

		Commercial				Government				International				Total				Commercial				Government				International				Total
		Three Months Ended March 31
		2024																2023
		Commercial				Government				International				Total				Commercial				Government				International				Total
Simulators and accessories		$	75,780			$	3,811,257			$	1,278,257			$	5,165,294			$	489,810			$	4,749,368			$	3,134,628			$	8,373,806
Extended Service-type warranties			-				870,803				4,202				875,005				23,343				539,208				19,424				581,975
Customized software and content			-				265,406				-				265,406				19,500				7,196				(16,861	)			9,835
Installation and training			-				236,339				5,164				241,503				20,562				249,554				53,688				323,804
Design & Prototyping			-				583,326				-				583,326				-				-				-				-
STEP			-				954,349				9,515				963,864				-				730,273				7,242				737,515
Total Revenue		$	75,780			$	6,721,480			$	1,297,138			$	8,094,398			$	553,215			$	6,275,599			$	3,198,121			$	10,026,935

 

Commercial customers include selling through prime contractors for military or law enforcement contracts domestically and until it becomes a larger portion of the revenue will include any healthcare sales.  Government customers are defined as directly selling to government agencies. For the three months ended March 31, 2024, governmental customers comprised $6,721,480, or 83% of total net sales, commercial customers comprised $75,780 or 1% of total net sales and international customers comprised $1,297,138 or 16% of total net sales. By comparison, for the three months ended March 31, 2023, governmental customers comprised $6,275,599, or 63% of total net sales, commercial customers comprised $553,215 or 5% of total net sales and international customers comprised $3,198,121, or 32% of total net sales. For the three months ended March 31, 2024, and 2023, the Company recorded $963,864 and $737,515, respectively, in STEP revenue, or 12% and 7%, respectively, of total net sales.

 

Customer Deposits

 

Customer deposits consist of prepaid deposits received for equipment purchase orders and for Subscription Training Equipment Partnership (“STEP”) operating agreements that expire annually. Customer deposits are considered a deferred liability until the completion of the customer’s contract performance obligation. When revenue is recognized, the deposit is applied to the customer’s receivable balance. Customer deposits are recorded as a current liability under deferred revenue on the accompanying balance sheet and totaled $1,534,268 and $2,092,095 on March 31, 2024, and December 31, 2023, respectively. Changes in deferred revenue amounts related to customer deposits will fluctuate from year to year based upon the mix of customers required to prepay deposits under the Company’s credit policy. The decrease in deferred revenue from December was due to the Company converting the deposits into revenue as we delivered on our obligations.

 

Warranty

 

The Company warranties its products from manufacturing defects on a limited basis for a period of one year after purchase, but also sells separately priced extended service-type warranties for periods of up to four years after the expiration of the standard one-year warranty. During the term of the initial one-year warranty, if the device fails to operate properly from defects in materials and workmanship, the Company will fix or replace the defective product. Deferred revenue for separately priced extended warranties one year or less totaled $2,417,342 and $2,627,763 as of March 31, 2024, and December 31, 2023, respectively. Deferred revenue for separately priced extended warranties longer than one year totaled $2,930,779 and $2,974,710 as of March 31, 2024, and December 31, 2023, respectively. The accrual for the one-year manufacturer’s warranty liability totaled $295,000 and $354,000 as of March 31, 2024, and December 31, 2023, respectively. We did see a small downtick in some warranty repairs, due to new quality controls and equipment, so we were able to decrease the accrual for repair expenses. During the three months ended March 31, 2024, and 2023, the Company recognized revenue of $875,044 and $581,975, respectively, related to the extended service-type warranties that was amortized from the deferred revenue balance at the beginning of each period. Changes in deferred revenue amounts related to extended service-type warranties will fluctuate from year to year based upon the average remaining life of the warranties at the beginning of the period and new extended service-type warranties sold during the period.

 

F-7

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Concentration of Credit Risk and Major Customers and Suppliers

 

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, certificates of deposit, and accounts receivable.

 

The Company’s cash, cash equivalents and certificates of deposit are maintained with financial institutions with high credit standings and are FDIC insured deposits. The FDIC insures deposits according to the ownership category in which the funds are insured and how the accounts are titled. The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. The Company had uninsured cash and cash equivalents of $22,415,177 and $18,349,842 as of March 31, 2024, and December 31, 2023, respectively.

 

Sales are typically made on credit and the Company generally does not require collateral. Management performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Historically, the Company has experienced minimal charges relative to doubtful accounts.

 

Historically, the Company primarily sells its products to U.S. federal, state and municipal agencies.

 

As of March 31, 2024, the Company had one customer that accounted for 22% of total accounts receivable. As of December 31, 2023, the Company had customers that accounted for 28% and 14% of total accounts receivable.

 

For the three months ended March 31, 2024 and 2023, the Company had did not have any single customer that accounted for 10% of total revenue.

 

Net Income per Common Share

 

The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows:

 Schedule of Earnings Per Share

		2024				2023
		Three Months Ended March 31
		2024				2023
Net Income		$	1,216,173			$	2,946,373
Weighted average common stock outstanding			10,959,298				10,917,311
Incremental shares from stock options			1,890				2,080
Weighted average common stock outstanding, diluted			10,961,188				10,919,391
Net Income per common share and common equivalent share
Basic		$	0.11			$	0.27
Diluted		$	0.11			$	0.27

 

F-8

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Note 2. Inventory

 

Inventory consisted of the following as of:

 Schedule of Inventory

		March 31, 2024				December 31, 2023
Raw materials and work in process		$	12,782,747			$	12,834,368
Reserve			(490,287	)			(429,488	)
Total Inventory		$	12,292,460			$	12,404,880

 

The Company regularly evaluates the useful life of its spare parts inventory but did not have any cause to reclassify any this quarter.

 

Note 3. Property and Equipment

 

Property and equipment consisted of the following as of:

 Schedule of Property and Equipment

		March 31, 2024				December 31, 2023
Land		$	1,778,987			$	1,778,987
Building & Building Improvements			9,146,556				9,146,556
Computer equipment			1,227,378				1,236,989
Furniture and office equipment			314,006				295,208
Machinery and equipment			4,326,010				2,865,014
STEP equipment			2,301,083				2,241,291
Leasehold improvements			358,584				358,584
Construction in Progress			2,470,054				2,456,259
Total property and equipment			21,922,658				20,375,888
Less: Accumulated depreciation and amortization			(5,123,199	)			(4,888,876	)
Property and equipment, net		$	16,799,459			$	15,487,012

 

Depreciation expenses, including STEP depreciation, were $234,324 and $195,034 for the three months ended March 31, 2024, and 2023, respectively.

 

Note 4. Intangible Assets

 

Intangible assets consisted of the following as of:

 Schedule of Intangible Asset

		March 31, 2024				December 31, 2023
Patents		$	160,000			$	160,000
Capitalized media content			451,244				451,244
Acquired lease intangible assets			83,963				83,963
Total intangible assets			695,207				695,207
Less accumulated amortization			(129,889	)			(127,667	)
Intangible assets, net		$	565,318			$	567,540

 

Amortization expenses were $2,222 and $5,626 for the three months ended March 31, 2024, and 2023, respectively.

 

F-9

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Note 5. Leases

 

The Company leases approximately 37,729 rentable square feet of office and warehouse space from an unaffiliated third party for our former corporate office, manufacturing, assembly, warehouse, and shipping facility located at 7970 South Kyrene Road, Tempe, Arizona 85284. From 2016 through March 2019, the Company leased approximately 4,529 rentable square feet of office and industrial space from an unaffiliated third party for our machine shop at 2169 East 5th Street, Tempe, Arizona 85284. In April 2019, the Company relocated the machine shop from the 5th Street location to 7910 South Kyrene Road, located within the same business complex as our main office. The Company executed a lease amendment to add an additional 5,131 rentable square feet for the machine shop and extended its existing office lease through April 2024. On June 1, 2022, we entered a new lease of approximately 9,350 square feet located at 12301 Challenger Parkway, Orlando, Florida, from an unaffiliate third party through May 2027.

 

The Company’s lease agreements do not contain any residual value guarantees, restrictive covenants, or variable lease payments. The Company has not entered into any financing leases.

 

In addition to base rent, the Company’s lease provides for additional payments for other charges, such as rental tax. The lease includes fixed rent escalations. The Company’s lease does not include an option to renew.

 

The Company determines if an arrangement is a lease at inception. Operating leases are recorded in operating lease right of use assets, net, operating lease liability – short-term, and operating lease liability – long-term on its balance sheets.

 

Operating lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company’s lease does not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate used at adoption was 4.5%. Significant judgement is required when determining the Company’s incremental borrowing rate. The Company uses the implicit rate when readily determinable. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

 

Effective June 1, 2022, the Company obtained a right-of-use asset in exchange for a new operating lease liability of $840,855. Effective January 1, 2019, the Company obtained a right-of-use asset in exchange for a new operating lease liability in the amount of $1,721,380 and derecognized $46,523 deferred rent for an adjusted operating lease right-of-use asset in the net amount of $1,674,857.

 Schedule of Balance Sheet Classification of Lease Assets and Liabilities

Balance Sheet Classification		March 31, 2024				December 31, 2023
Assets
Operating lease right-of-use assets, December 31, 2023		$	716,687			$	1,212,814
Amortization for the three months ended March 31, 2024			(127,893	)			(496,127	)
Total operating lease right-of-use asset, March 31, 2024		$	588,794			$	716,687
Liabilities
Current
Operating lease liability, short-term		$	323,038			$	317,840
Non-current
Operating lease liability, long-term			289,687				432,176
Total lease liabilities		$	612,725			$	750,016

 

F-10

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Future minimum lease payments as of March 31, 2024, under non-cancelable operating leases are as follows:

 Schedule of Future Minimum Lease Payments

2024		$	190,045
2025			191,478
2026			196,311
2027			99,381
Total Lease Payments			677,215
Less: imputed interest			(64,490	)
Operating Lease Liability		$	612,725

 

Rent expenses for the three months ended March 31, 2024, and 2023, were $204,235 and $108,230, respectively.

 

Note 6. Accrued Expenses

 

Accrued compensation and related costs consist of the following as of:

 Schedule of Accrued Compensation and Related Costs

		March 31, 2024				December 31, 2023
Salaries and wages payable		$	225,152			$	457,565
Employee benefits payable			44,261				54,811
Accrued paid time off (PTO)			395,543				361,418
Profit sharing payable			1,511,122				1,347,622
Total accrued compensation and related costs		$	2,176,078			$	2,221,416

 

Accrued expenses and other current liabilities consist of the following as of:

 Schedule of Accrued Expenses and Other Current Liabilities

		March 31, 2024				December 31, 2023
Manufacturer’s warranties		$	295,000			$	354,000
Taxes payable			3,872,036				3,411,669
Miscellaneous payable			215,325				204,890
Total accrued expenses and other current liabilities		$	4,382,361			$	3,970,559

 

F-11

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

Note 7. Note Payable

 

On August 25, 2021, the Company completed the purchase of real property located in Chandler, Arizona (the “Property”) for $10,800,000, paid with cash and proceeds from a mortgage loan from Arizona Bank & Trust in the amount of $8,600,000. The loan terms include interest to be accrued at a fixed rate of 3% per year, 119 regular monthly payments of $40,978, and one irregular payment of $5,956,538 due on the maturity date of August 23, 2031. The Company began making monthly payments on September 23, 2021. The payment and performance of the loan is secured by a security interest in the property acquired.

 

The note payable amounts consist of the following:

 Schedule of Notes Payable

		March 31, 2024				December 31, 2023
Short-term liabilities
Note payable, principal		$	221,910			$	222,320
Accrued interest to date			4,745				4,035
Note Payable, short-term		$	226,655			$	226,355
Long-term liabilities
Note payable, principal		$	7,751,585			$	7,813,021
Note payable, long tern		$	7,751,585			$	7,813,021

 

Note 8. Related Party Transactions

 

During the three months ended March 31, 2024, one Board member purchased 2,500 shares of common stock, $0.0001 par value per share (the “Common Stock”), pursuant to the exercise of previously awarded stock options at the exercise price of $10,750.

 

During the three months ended March 31, 2023, one Board member and the Company’s Executive Chairman (then Co-CEO) purchased 7,500 shares of Common Stock pursuant to the exercise of previously awarded stock options at the exercise price of $2.23 per share, for a total of $16,726.

 

Note 9. Commitments and Contingencies

 

Litigation

 

From time to time, the Company is notified of litigation or that a claim is being made against it. The Company evaluates contingencies on an on-going basis and has established loss provisions for matters in which losses are probable and the amount of loss can be reasonably estimated. There is no pending litigation at this time.

 

Restricted Stock Unit Grants

 

On August 26, 2021, and April 11, 2022, the Compensation Committee of the Board of Directors granted a total of 392,223, and 288,889 Restricted Stock Units (RSUs), respectively, pursuant to Section 9 of the 2017 Equity Incentive Plan to the co-Chief Executive Officers and the Chief Operating Officer, to be awarded based on achievement of certain performance goals over the next three years. During August 2022, 168,090 Restricted Stock Units were forfeited upon the departure of the Chief Operating Officer.

 

F-12

 

 

VIRTRA, INC.

NOTE TO FINANCIAL STATEMENTS

(Unaudited)

 

On December 1, 2022, the Company granted a total of 15,000 RSUs to its Chief Financial Officer, which can be awarded based on achievement of performance goals over the next three years. On January 1, 2023, the Company issued 42,735 RSUs to a new member of the Board of Directors which can be awarded only upon a sale of the Company.

 

It is the Company’s policy to estimate the fair value of the RSU’s on the date of the grant and evaluate the probability of achieving the net profit (net income under GAAP) tranches quarterly. If the target is deemed probable, the expense is amortized on a straight-line basis over the remaining period. The Company determined based on the vesting terms described above that the net profit (net income under GAAP) for the twelve months ending June 30, 2023, was $4,564,459 and therefore awarded 22,988 (prior to deduction of 9,142 shares to pay the tax withholding liability) and 29,630 (prior to the deduction of 11,394 shares to pay the tax withholding liability) shares of common stock to its Executive Chairman and CEO, respectively. The Company determined based on the vesting terms described above that the net profit (net income under GAAP) for the twelve months ending June 30, 2024, of $5,000,000 is probable and recorded expenses of $139,998 related to the RSUs for the three months ended March 31, 2024.

 

Profit Sharing

 

VirTra provides a discretionary profit-sharing program that pays out a percentage of Company profits each year as a cash bonus to eligible employees. The cash payment is typically split into two equal payments and distributed pro-rata in April and October of the following year to only active employees. For the three months ended March 31, 2024, and 2023, $163,500 and $150,000 was expensed to operations for profit sharing.

 

Note 10. Stockholders’ Equity

 

Stock Repurchase

 

On October 25, 2016, the Company’s Board of Directors authorized the repurchase of up to $1 million of its common stock under Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended. Purchases made pursuant to this authorization will be made in the open market, in privately negotiated transactions, or pursuant to any trading plan that may be adopted in accordance with Rule 10b-18. The timing, manner, price, and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements, and other factors. On January 9, 2019, VirTra’s Board of Directors authorized an additional $1 million be allocated for the repurchase of VirTra’s stock under the existing 10b-18 plan. The stock repurchase program was suspended due to interim rulings for public-company recipients of a PPP loan under the CARES Act. Although the Company’s PPP loan was forgiven on July 20, 2021, the suspension of the stock repurchase program continues to remain in effect.

 

Non-qualified Stock Options

 

The Company has periodically issued non-qualified stock options to key employees, officers and directors under a stock option compensation plan approved by the Board of Directors in 2009. Terms of option grants are at the discretion of the Board of Directors and are generally seven years. Upon the exercise of these options, the Company expects to issue new authorized shares of its common stock. The following table summarizes all non-qualified stock options as of:

 Schedule of Non-qualified Stock Options

		March 31,2024								December 31, 2023
		Number of Stock Options				Weighted Exercise Price				Number of Stock Options				Weighted Exercise Price
Options outstanding, beginning of year			15,000			$	4.03				45,000			$	4.26
Granted			-				-				-				-
Redeemed			(5,000	)			4.3				(15,000	)			5.09
Exercised			(2,500	)			4.3				(15,000	)			3.66
Expired / terminated			-				-				-				-
Options outstanding, end of period			7,500			$	3.76				15,000			$	4.03
Options exercisable, end of period			7,500			$	3.76				15,000			$	4.03

 

The Company did not have any non-vested stock options outstanding as of March 31, 2024, and December 31, 2023. The weighted average contractual term for options outstanding and exercisable on March 31, 2024, and 2023 was 7 years. The aggregate intrinsic value of the options outstanding and exercisable on March 31, 2024, and 2023 was $28,875 and $1,800, respectively. For the three months ended March 31, 2024, and 2023, the Company received payments related to the exercise of options in the amount of $10,750 and $16,726, respectively. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the Company’s common stock for those stock options that have an exercise price lower than the fair value of the Company’s common stock. Options with an exercise price above the fair value of the Company’s common stock are considered of no intrinsic value.

 

2017 Equity Incentive Plan

 

Through March 31, 2024, 224,133 and 288,889 restricted stock units (RSUs) have been granted under the Equity Plan to the Company’s Executive Chairman and CEO, respectively, of which 17,753 and 158,976 shares were issued in settlement of such RSUs. Also, 10,543 and 14,057 restricted shares were issued to the Company’s former COO and Executive Chairman.

 

Common stock activity

 

During the three months ended March 31, 2024, one Board member purchased 2,500 shares of Common Stock pursuant to the exercise of previously awarded stock options at the exercise price of $4.30 per share, for a total of $10,750.

 

Note 11. Subsequent Events

 

None

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto as of and for the year ended December 31, 2023 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on April 1, 2024.

 

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, (the “Exchange Act”), 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 Quarterly Report on Form 10-Q 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 numerous 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 this Quarterly Report on Form 10-Q. You should carefully consider these risk 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 people acting on our behalf are expressly qualified in their entirety by this cautionary statement.

 

Business Overview

 

VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” and “our”) is a global provider of judgmental use of force training simulator and 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.

 

The VirTra firearms training simulator allows marksmanship and realistic scenario-based training to take place daily without the need for a shooting range, protective equipment, role players, safety officers, or a scenario-based training site. We have developed a higher standard in simulation training including capabilities such as: multi-screen, video-based scenarios, unique scenario authoring ability, superior training scenarios, the patented Threat-Fire® shoot-back system, powerful gas-powered simulated recoil weapons, and more. The simulator also allows students to receive immediate feedback from the instructor without the potential for sustaining injuries by the instructor or the students. The instructor can teach and re-mediate critical issues, while placing realistic stress on the students due to the realism and safe training environment created by the VirTra simulator.

 

 

Business Strategy

 

We have two main customer groups, namely, law enforcement and military. These are quite different markets and require different sales and marketing programs as well as personnel. Our focus is to expand the market share  and scope of our training simulators sales to these identified customer groups by pursuing the following key growth strategies:

 

	●	Build Our Core Business. Our goal is to profitably grow our market share by continuing to develop, produce and market the most effective simulators possible. Through disciplined growth in our business, we have achieved a solid balance sheet by increasing our working capital and limiting our bank debt. We plan to add staff to our experienced management team as needed to meet the expected increase in demand for our products and services as we increase our marketing and sales activities.
	●	Increase Total Addressable Market. We plan to increase the size of our total addressable market. This effort will focus on new marketing and new product and/or service offerings for the purpose of widening the number of types of customers who might consider our products or services uniquely compelling.
	●	Broaden Product Offerings. Since its formation in 1993, our company has had a proud tradition of innovation in the field of simulation and virtual reality. We plan to release revolutionary new products and services as well as continue incremental improvements to existing product lines. In some cases, the company may enter a new market segment via the introduction of a new type of product or service.
	●	Partners and Acquisitions. We try to spend our time and funds wisely and not tackle tasks that can be done more efficiently with partners. For example, international distribution is often best accomplished through a local distributor or agent. We are also open to the potential of acquiring additional businesses or of being acquired ourselves, based on what is expected to be optimal for our long-term future and our stockholders.

 

Product Offerings

 

Our simulator products include the following:

 

●

V-300™ Simulator – a 300° wrap-around screen with video capability is the higher standard for simulation training

 

	○	The V-300™ is the higher standard for decision-making simulation and tactical firearms training. Five screens and a 300-degree immersive training environment ensures that time in the simulator translates into real world survival skills. The system reconfigures to support 15 individual firing lanes.
	○	A key feature of the V-300™ shows how quickly judgment decisions must be made, and, sometimes, if they are not made immediately and accurately, it can lead to the possible loss of lives. This feature, among others, supports our value proposition to our customers is that best practices is being prepared enough for the surprises that could be around every corner and the ability to safely neutralize any life-threatening encounters.

 

●

V-180™ Simulator – a 180° screen with video capability is for smaller spaces or smaller budgets

 

○

The V-180™ is the higher standard for decision-making simulation and tactical firearms training. Three screens and a 180-degree immersive training environment ensure that time in the simulator translates into real world survival skills.

 

●

V-100™ Simulator & V-100™ MIL – a single-screen based simulator systems

 

○

The V-100™ is the higher standard among single-screen firearms training simulators. Firearms training mode supports up to 4 individual firing lanes at one time. The optional Threat-Fire™ device safely simulates enemy return fire with an electric impulse (or vibration version), reinforcing performance under pressure. We offer an upgrade path, so a V-100™ firearms training and force options simulator can affordably grow into an advanced multi-screen trainer in upgraded products that we offer customers for future purchase.

 

 

	○	The V-100™ MIL is sold to various military commands throughout the world and can support any local language. The system is extremely compact and can even share space with a standard classroom or fits into almost any existing facility. If a portable firearms simulator is needed, this model offers the most compact single-screen simulator on the market today – everything organized into one standard case. The V-100™ MIL is the higher standard among single-screen small arms training simulators. Military Engagement Skills mode supplies realistic scenario training taken from real world events.
	○	The V-ST PRO™ a highly realistic single screen firearms shooting and skills training simulator with the ability to scale to multiple screens creating superior training environments. The system’s flexibility supports a combination of marksmanship and use of force training on up to 5 screens from a single operator station. The V-ST PRO™ is also capable of displaying 1 to 30 lanes of marksmanship featuring real world, accurate ballistics.

 

	●	Virtual Interactive Coursework Training Academy (V-VICTA)™ enables law enforcement agencies, to effectively teach, train, test and sustain departmental training requirements through nationally accredited coursework and training scenarios using our simulators.
	●	Subscription Training Equipment Partnership (STEP)™ is a program that allows agencies to utilize VirTra’s simulator products, accessories, and V-VICTA interactive coursework on a subscription basis.
	●	V-Author™ Software allows users to create, edit, and train with content specific to agency’s objectives and environments. V-Author™ is an easy-to-use application capable of almost unlimited custom scenarios, skill drills, targeting exercises and firearms courseware proven to be highly effective for users of VirTra simulation products.
	●	Simulated Recoil Kits - a wide range of highly realistic and reliable simulated recoil kits/weapons
	●	Return Fire Device – the patented Threat-Fire™ device which applies real-world stress on the trainees during simulation training.
	●	VirTra has installed a volumetric video capture studio in order to create training scenarios that could work in either screen-based simulators or in headset-based simulators. Volumetric video realism far exceeds that of computer-generated avatars which likely gives VirTra a strategic advantage for highly desired de-escalation training, especially when simulating human interaction is required.
	●	TASER©, OC spray and low-light training devices that interact with VirTra’s simulators for training.

 

Results of operations for the three months ended March 31, 2024, and March 31, 2023

 

Revenues. Net sales were $8,094,398 for the three months ended March 31, 2024, compared to $10,026,935 for the same period in 2023, a decrease of $1,932,537 or 19%. The decrease in revenue can be attributed to lower bookings in Q4 and Q1 as related to federal funding due to the continuing resolution and many contracts on hold.

 

Cost of Sales. Cost of sales were $2,632,257 for the three months ended March 31, 2024, compared to $3,077,997 for the same period in 2023, a decrease of $445,740 or 14%. The dollar decrease is correlates with the lower revenues for the current quarter.

 

Gross Profit. Gross profit was $5,462,141 for the three months ended March 31, 2024, compared to $6,948,938 for the same period in 2023, a decrease of $1,486,797, or 21%. The gross profit margin for the three months ended March 31, 2024, and 2023 was 67% and 69%, respectively. The gross margin was lower in 2024 mostly due to the cost of goods related to the Microsoft Prototype contract. We had a milestone payment in December of 2023 that had little cost associated with it. The costs from the second milestone were recorded this quarter and consumed some of the margin. Our efforts to lower the costs associated with the rest of the systems are evident with these results as only an overall 2% margin decrease was recognized.

 

 

Operating Expenses. Net operating expense was $4,063,802 for the three months ended March 31, 2024, compared to $3,477,633 for the same period in 2023, an increase of $586,169, or 17%. This increase is primarily evident in three areas. One is payroll and benefits as labor rates increase and as we bring on higher level staff to help build infrastructure for the future. The second area is in our IT spending as we prepare the organization to help us become more compliant with new regulations, which is needed for any future government contracts. The third area is travel as we are increasing our footprint in our sales territories.

 

Operating Income. Operating income was $1,398,339 for the three months ended March 31, 2024, compared to $3,471,305 for the same period in 2023, a decrease of 2,072,966 or 60%. This decrease is directly related to the lower revenue and higher operating expense discussed above.

 

Other Income. Other income net of other expense was $329,271 for the three months ended March 31, 2024, compared to net other income of $116,413 for the same period in 2023, an increase of $212,858, or 183%, primarily from the lease payments from the subtenant at our older facility which was not leased during the 2023 quarter.

 

Provision (Benefit) for Income Tax. Provision for income tax was $511,437 for the three months ended March 31, 2024, compared to $641,345 for the same period in 2023, a decrease of $129,908, or 20%. Provision for income tax is estimated quarterly applying both federal and state tax rates.

 

Net Income. Net income was $1,216,173 for the three months ended March 31, 2024, compared to $2,946,373 for the same period in 2023, a decrease of $1,730,200 or 59%. The fluctuations in net income relate to each respective section discussed above.

 

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization. Explanation and Use of Non-GAAP Financial Measures:

 

Earnings before interest, income taxes, depreciation, and amortization and before other non-operating costs and income (“EBITDA”) and adjusted EBITDA are non-GAAP measures. Adjusted EBITDA also includes non-cash stock option expense. Other companies may calculate adjusted EBITDA differently. The Company 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 the Company’s investors regarding the Company’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 the Company’s industry, several of which present EBITDA and 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 the Company’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 (loss), cash flows from operating activities and other income or cash flow statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. A reconciliation of net loss to adjusted EBITDA is provided in the following table:

 

		For the Three Months Ended
		March 31,				March 31,				Increase				%
		2024				2023				(Decrease)				Change
Net Income		$	1,216,173			$	2,946,373			$	(1,730,200	)			-59	%
Adjustments:
Provision for income taxes			511,437				641,345				(129,908	)			-20	%
Depreciation and amortization			236,547				227,570				8,977				4	%
Interest (net)			(177,898	)			48,183				(226,081	)			-469	%
EBITDA			1,786,259				3,863,471				(2,077,212	)			-54	%
Right of use amortization			127,893				121,774				6,119				5	%
Adjusted EBITDA		$	1,914,152			$	3,985,245			$	(2,071,093	)			-52	%

 

 

Liquidity and Capital Resources

 

Liquidity is an enterprise’s ability to generate enough cash to meet its needs for cash requirements. The Company had $22,415,177 and $18,849,842 of cash and cash equivalents as of March 31, 2024, and December 31, 2023, respectively. Working capital was $33,180,190 and $33,240,516 as of March 31, 2024, and December 31, 2023, respectively.

 

Net cash provided by operating activities was $5,136,509 and $978,603 for the three months ended March 31, 2024, and 2023, respectively. Net cash provided by operating activities resulted primarily from the net income for both periods.

 

Net cash used in investing activities was $1,546,772 for the three months ended March 31, 2024, compared to net cash used in investing activities of $163,441 for the comparable 2023 period. Investing activities in 2024 and 2023 consisted of purchases of property and equipment.

 

Net cash used in financing activities was $24,402 for the three months ended March 31, 2024, compared to $41,024 used for the three months ended March 31, 2023. In both periods, cash was used primarily for principal payment of debt offset by the proceeds from the exercise of stock options.

 

Bookings and Backlog. The Company defines bookings as the total number of newly signed contracts and purchase orders received in a defined time period. The Company received bookings totaling $2.9 million for the three months ended March 31, 2024. The Company defines backlog as the accumulation of bookings that have not started or are uncompleted performance objectives and cannot be recognized as revenue until delivered in a future quarter. Backlog also includes extended warranty agreements and STEP agreements that are deferred revenue recognized on a straight-line basis over the life of each respective agreement. As of March 31, 2024, the Company’s backlog was $14 million. The breakout of this backlog includes $5.4 million in capital, $6.4 million in service and warranties, and $2.2 million in STEP contracts. Warranties/Service and STEP backlog calculated in this number is revenue that will be recognized on a straight-line basis over the next 7 years. In addition, there is $6.8 million in renewable STEP contracts over the next 5 years. Management estimates most of the new capital bookings received in the first three months of 2024, will be converted to revenue in 2024. Management estimates the conversion of backlog based on current contract delivery dates; however, contract terms and dates are subject to modification and are routinely changed at the request of the customer.

 

 

Cash Requirements

 

Our management believes that our current capital resources will be adequate to continue operating the company and maintaining our current business strategy for more than 12 months from the filing of this Quarterly Report. We are, however, open to raising additional funds from the capital markets, at a fair valuation, to expand our product and services offered, to enhance our sales and marketing efforts and effectiveness, and to aggressively take advantage of market opportunities. There can be no assurance, however, that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to scale down our plans for expanded marketing and sales efforts.

 

Critical Accounting Policies and Estimates

 

Our discussion and analysis of our financial condition and results of operations are based on our unaudited financial statements, which have been prepared in accordance with GAAP. The preparation of our unaudited financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to areas that require a significant level of judgment or are otherwise subject to an inherent degree of uncertainty. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts and notes receivable, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets, income tax valuation allowances, the carrying value of cost basis investments, and the allocation of the transaction price to the performance obligations in our contracts with customers. We base our estimates on historical experience, our observance of trends in particular areas, and information or valuations and various other assumptions that we believe to be reasonable under the circumstances and which form the basis for making judgments about the carrying value of assets and liabilities that may not be readily apparent from other sources. Actual amounts could differ significantly from amounts previously estimated. For a discussion of our critical accounting policies, refer to Part I, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023. Management believes there have been no changes in our critical accounting policies during the three months ended March 31, 2024.

 

Recent Accounting Pronouncements

 

See Note 1 to our financial statements, included in Part I, Item 1., Financial Information of this Quarterly Report on Form 10-Q.

 

Off-Balance Sheet Arrangements

 

As of March 31, 2024, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with us is a party, under which we have any obligation arising under a guarantee contract, derivative instrument or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

Not required for smaller reporting companies.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of disclosure controls and procedures

 

We maintain “disclosure controls and procedures,” as that term is defined in Rule 13a-15(e), promulgated by the SEC pursuant to the Exchange Act. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our Company’s reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officers and principal financial officer, to allow timely decisions regarding required disclosure. Our management, with the participation of our principal executive officers and principal financial officer, evaluated our Company’s disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, our principal executive officers and principal financial officer concluded that as of March 31, 2024, our disclosure controls and procedures were not effective. The ineffectiveness of our disclosure controls and procedures was due to material weaknesses, which we identified in our report on internal control over financial reporting contained in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on April 1, 2024.

 

Change in internal control over financial reporting

 

There has been no change in our internal control over financial reporting that occurred during the quarterly period ended March 31, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. However, during the quarter ended March 31, 2024, and continuing into 2024, we are implementing more formal review and documentation of workflow processes and increased our ERP training for our staff. We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within any company have been detected.

 

PART II: OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

There is no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which we are a party or of which any of our property is the subject.

 

ITEM 1A. RISK FACTORS

 

Not required for smaller reporting companies.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

 

ITEM 5. OTHER INFORMATION

 

	(a)	None
	(b)	There have been no material changes to the procedures by which security holders may recommend nominees to the Company’s Board of Directors since the filing with the SEC of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
	(c)	None.

 

ITEM 6. EXHIBITS

 

Exhibit No.		Exhibit Description
31.1		Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of the Principal Executive Officers and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	VIRTRA, INC.
Date: May 14, 2024	By:	/s/ John F. Givens II
		John F. Givens II
		Chief Executive Officer
		(principal executive officer)
	By:	/s/ Alanna Boudreau
		Chief Financial Officer
		(principal financial officer)

 

 

 

Exhibit 31.1

 

CERTIFICATIONS

 

I, John F. Givens II, certify that:

 

b. I have reviewed this quarterly report on Form 10-Q for the quarterly period ended March 31, 2024, of VirTra, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(b) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

I Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(b) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: May 14, 2024	/s/ John F. Givens II
	John F. Givens II
	Chief Executive Officer (principal executive officer)

 

 

 

Exhibit 31.2

 

CERTIFICATIONS

 

I, Alanna Boudreau, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q for the quarterly period ended March 31, 2024, of VirTra, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, considering the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: May 14, 2024	/s/ Alanna Boudreau
	Alanna Boudreau
	Chief Financial Officer (principal financial officer)

 

 

 

Exhibit 32.1

 

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the quarterly report on Form 10-Q of VirTra, Inc. (the “Company”) for the quarter ended March 31, 2024 as filed with the Securities and Exchange Commission (the “Report”), we, John F. Givens II, Chief Executive Officer, and Alanna Boudreau, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of our knowledge:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

Date: May 14, 2024	/s/ John F. Givens II
	John F. Givens II, Chief Executive Officer
	(principal executive officer)
Date: May 14, 2024	/s/ Alanna Boudreau
	Alanna Boudreau, Chief Financial Officer
	(principal financial officer)

 

 

v3.24.1.1.u2

Cover - shares	3 Months Ended
	Mar. 31, 2024	May 03, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	001-38420
Entity Registrant Name	VIRTRA, INC.
Entity Central Index Key	0001085243
Entity Tax Identification Number	93-1207631
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	295 E. Corporate Place
Entity Address, City or Town	Chandler
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85225
City Area Code	(480)
Local Phone Number	968-1488
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	VTSI
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		11,109,730

v3.24.1.1.u2

Condensed Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 22,415,177	$ 18,849,842
Accounts receivable, net	10,300,165	15,724,147
Inventory, net	12,292,460	12,404,880
Unbilled revenue	1,681,375	1,109,616
Prepaid expenses and other current assets	832,712	906,803
Total current assets	47,521,889	48,995,288
Long-term assets:
Property and equipment, net	16,799,459	15,487,012
Operating lease right-of-use asset, net	588,794	716,687
Intangible assets, net	565,318	567,540
Security deposits, long-term	35,691	35,691
Other assets, long-term	201,670	201,670
Deferred tax asset, net	3,663,357	3,630,154
Total long-term assets	21,854,289	20,638,754
Total assets	69,376,178	69,634,042
Current liabilities:
Accounts payable	1,695,042	2,282,427
Accrued compensation and related costs	2,176,078	2,221,416
Accrued expenses and other current liabilities	4,382,361	3,970,559
Note payable, current	226,655	226,355
Operating lease liability, short-term	323,038	317,840
Deferred revenue, short-term	5,538,525	6,736,175
Total current liabilities	14,341,699	15,754,772
Long-term liabilities:
Deferred revenue, long-term	3,004,418	3,012,206
Note payable, long-term	7,751,585	7,813,021
Operating lease liability, long-term	289,687	432,176
Total long-term liabilities	11,045,690	11,257,403
Total liabilities	25,387,389	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 value	1,110	1,109
Additional paid-in capital	32,108,513	31,957,765
Retained earnings	11,879,166	10,662,993
Total stockholders’ equity	43,988,789	42,621,867
Total liabilities and stockholders’ equity	69,376,178	69,634,042
Common Class A [Member]
Stockholders’ equity:
Common stock value
Common Class B [Member]
Stockholders’ equity:
Common stock value

v3.24.1.1.u2

Condensed Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	2,500,000	2,500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	11,109,730	11,107,230
Common stock, shares outstanding	11,109,730	11,107,230
Common Class A [Member]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	2,500,000	2,500,000
Common stock, shares issued	0	0
Common stock, shares outstanding	0	0
Common Class B [Member]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	7,500,000	7,500,000
Common stock, shares issued	0	0
Common stock, shares outstanding	0	0

v3.24.1.1.u2

Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenues:
Total revenue	$ 8,094,398	$ 10,026,935
Cost of sales	2,632,257	3,077,997
Gross profit	5,462,141	6,948,938
Operating expenses:
General and administrative	3,370,422	2,711,337
Research and development	693,380	766,296
Net operating expense	4,063,802	3,477,633
Income from operations	1,398,339	3,471,305
Other income:
Other income	329,271	183,642
Gain on forgiveness of note payable		(67,229)
Other income
Net other income	329,271	116,413
Income before provision for income taxes	1,727,610	3,587,718
Provision for income taxes	511,437	641,345
Net income	$ 1,216,173	$ 2,946,373
Net income per common share:
Basic	$ 0.11	$ 0.27
Diluted	$ 0.11	$ 0.27
Weighted average shares outstanding:
Basic	10,959,298	10,917,311
Diluted	10,961,188	10,919,391
Net Sales [Member]
Revenues:
Total revenue	$ 8,094,398	$ 10,026,935

v3.24.1.1.u2

Condensed Statements of Changes in Stockholders' Equity (Unaudited) - USD ($)	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2022		$ 1,089	$ 31,420,395		$ 2,260,135	$ 33,681,619
Balance, shares at Dec. 31, 2022		10,900,759
Stock options exercised		$ 1	16,725			16,726
Stock Options Exercised, shares		7,500
Stock reserved for future services			24,063			24,063
Net income					2,946,373	2,946,373
Stock issued for services		$ 1	74,999			75,000
Stock issued for services, shares		16,015
Balance at Mar. 31, 2023		$ 1,091	31,536,182		5,206,508	36,743,781
Balance, shares at Mar. 31, 2023		10,924,274
Balance at Dec. 31, 2022		$ 1,089	31,420,395		2,260,135	33,681,619
Balance, shares at Dec. 31, 2022		10,900,759
Balance at Dec. 31, 2023		$ 1,109	31,957,765		10,662,993	42,621,867
Balance, shares at Dec. 31, 2023		11,107,230
Stock options exercised		$ 1	10,749			10,750
Stock Options Exercised, shares		2,500
Stock reserved for future services			139,999			139,999
Net income					1,216,173	1,216,173
Balance at Mar. 31, 2024		$ 1,110	$ 32,108,513		$ 11,879,166	$ 43,988,789
Balance, shares at Mar. 31, 2024		11,109,730

v3.24.1.1.u2

Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Cash flows from operating activities:
Net income	$ 1,216,173	$ 2,946,373
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	236,547	227,570
Right of use amortization	127,893	121,774	$ 496,127
Employee stock compensation	139,999	24,063
Bad Debt Expense	245,089
Stock issued for service		75,000
Changes in operating assets and liabilities:
Accounts receivable, net	5,178,893	(1,686,838)
Inventory, net	112,420	(1,155,466)
Deferred taxes	(33,203)	(865,745)
Unbilled revenue	(571,759)	(430,488)
Prepaid expenses and other current assets	74,091	(1,675)
Other assets		(792)
Accounts payable and other accrued expenses	(246,905)	1,610,884
Operating lease right of use	(137,291)	(126,592)
Deferred revenue	(1,205,438)	240,535
Net cash provided by operating activities	5,136,509	978,603
Cash flows from investing activities:
Purchase of property and equipment	(1,546,772)	(163,441)
Net cash (used in) investing activities	(1,546,772)	(163,441)
Cash flows from financing activities:
Principal payments of debt	(35,152)	(57,750)
Proceeds from Stock based options	10,750	16,726
Net cash (used in) financing activities:	(24,402)	(41,024)
Net increase in cash	3,565,335	774,138
Cash and restricted cash, beginning of period	18,849,842	13,483,597	13,483,597
Cash and restricted cash, end of period	22,415,177	14,257,735	$ 18,849,842
Supplemental disclosure of cash flow information:
Income taxes paid	24,002	108,777
Interest paid	$ 61,552	$ 3,345

v3.24.1.1.u2

Organization and Significant Accounting Policies	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Organization and Significant Accounting Policies	Note 1. Organization and Significant Accounting Policies   Organization and Business Operations   VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” or “our”), located in Chandler, Arizona, is a global provider of judgmental use of force training simulators and 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. The Company sells its products worldwide through a direct sales force and international distribution partners. The original business started in 1993 as Ferris Productions, Inc and ultimately became VirTra, Inc., a Nevada corporation.   Basis of Presentation   The unaudited financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on April 1, 2024. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading.   The accompanying unaudited financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position on March 31, 2024, and the results of our operations and cash flows for the periods presented. We derived the December 31, 2023, balance sheet data from audited financial statements; however, we did not include all disclosures required by GAAP.   Interim results are subject to seasonal variations, and the results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the full year.   Use of Estimates   The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets and intangible assets, income tax valuation allowances, and the allocation of the transaction price to the performance obligations in our contracts with customers.   Revenue Recognition   The Company adopted the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customer (Topic 606) (“ASC 606”) on January 1, 2018, and the Company elected to use the modified retrospective transition method which requires application of ASC 606 to uncompleted contracts at the date of adoption. The adoption of ASC 606 did not have a material impact on the financial statements.   Under ASC 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant judgment is necessary when making these determinations.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   The Company’s primary sources of revenue are derived from simulator and accessories sales, training and installation, the sale of customizable software and the sale of extended service-type warranties. The Company’s policy is to typically invoice upon completion of installation and/or training until such a time the performance obligations that have been satisfied are included in unbilled. Sales discounts are presented in the financial statements as reductions in determining net revenues. Credit sales are recorded as current assets (accounts receivable and unbilled revenue). Prepaid deposits received at the time of sale and extended warranties purchased are recorded as current and long-term liabilities (deferred revenue) until earned. The following briefly summarizes the nature of our performance obligations and method of revenue recognition:   Performance Obligation   Method of Recognition       Simulator and accessories   Upon transfer of control       STEP Program   Deferred and recognized over the life of the contract       Installation and training   Upon completion or over the period of services being rendered       Extended service-type warranty   Deferred and recognized over the life of the extended warranty       Customized software and content   Upon transfer of control or over the period services are performed depending on the terms of the contract       Customized content scenario   As performance obligation is transferred over time (input method using time and materials expanded)       Design and prototyping   Recognized at the completion of each agreed upon milestone       Sales-based royalty exchanged for license of intellectual property   Recognized as the performance obligation is satisfied over time – which is as the sales occur.   The Company recognizes revenue upon transfer of control or upon completion of the services for the simulator and accessories; for the installation and training and customized software performance obligations as the customer has the right and ability to direct the use of these products and services and the customer obtains all of the remaining benefit from these products and services at that time. Revenue from certain customized content contracts may be recognized over the period the services are performed based on the terms of the contract. For the sales-based royalty exchanged for license of intellectual property, the Company recognized revenue as the sales occur over time.   The Company recognizes revenue on a straight-line basis over the period of services being rendered for the extended service-type warranties as these warranties represent a performance obligation to “stand ready to perform” over the duration of the warranties. As such, the warranty service is performed continuously over the warranty period.   Each contract states the transaction price. The contracts do not include variable consideration, significant financing components or noncash consideration. The Company has elected to exclude sales and similar taxes from the measurement of the transaction price. The contract’s transaction price is allocated to the performance obligations based upon their stand-alone selling prices. Discounts on the stand-alone selling prices, if any, are allocated proportionately to each performance obligation.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   Disaggregation of Revenue   Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation.  Schedule of Disaggregation of Revenue     Commercial     Government     International     Total     Commercial     Government     International     Total       Three Months Ended March 31       2024     2023       Commercial     Government     International     Total     Commercial     Government     International     Total   Simulators and accessories   $ 75,780     $ 3,811,257     $ 1,278,257     $ 5,165,294     $ 489,810     $ 4,749,368     $ 3,134,628     $ 8,373,806   Extended Service-type warranties     -       870,803       4,202       875,005       23,343       539,208       19,424       581,975   Customized software and content     -       265,406       -       265,406       19,500       7,196       (16,861 )     9,835   Installation and training     -       236,339       5,164       241,503       20,562       249,554       53,688       323,804   Design & Prototyping     -       583,326       -       583,326       -       -       -       -   STEP     -       954,349       9,515       963,864       -       730,273       7,242       737,515   Total Revenue   $ 75,780     $ 6,721,480     $ 1,297,138     $ 8,094,398     $ 553,215     $ 6,275,599     $ 3,198,121     $ 10,026,935     Commercial customers include selling through prime contractors for military or law enforcement contracts domestically and until it becomes a larger portion of the revenue will include any healthcare sales.  Government customers are defined as directly selling to government agencies. For the three months ended March 31, 2024, governmental customers comprised $6,721,480, or 83% of total net sales, commercial customers comprised $75,780 or 1% of total net sales and international customers comprised $1,297,138 or 16% of total net sales. By comparison, for the three months ended March 31, 2023, governmental customers comprised $6,275,599, or 63% of total net sales, commercial customers comprised $553,215 or 5% of total net sales and international customers comprised $3,198,121, or 32% of total net sales. For the three months ended March 31, 2024, and 2023, the Company recorded $963,864 and $737,515, respectively, in STEP revenue, or 12% and 7%, respectively, of total net sales.   Customer Deposits   Customer deposits consist of prepaid deposits received for equipment purchase orders and for Subscription Training Equipment Partnership (“STEP”) operating agreements that expire annually. Customer deposits are considered a deferred liability until the completion of the customer’s contract performance obligation. When revenue is recognized, the deposit is applied to the customer’s receivable balance. Customer deposits are recorded as a current liability under deferred revenue on the accompanying balance sheet and totaled $1,534,268 and $2,092,095 on March 31, 2024, and December 31, 2023, respectively. Changes in deferred revenue amounts related to customer deposits will fluctuate from year to year based upon the mix of customers required to prepay deposits under the Company’s credit policy. The decrease in deferred revenue from December was due to the Company converting the deposits into revenue as we delivered on our obligations.   Warranty   The Company warranties its products from manufacturing defects on a limited basis for a period of one year after purchase, but also sells separately priced extended service-type warranties for periods of up to four years after the expiration of the standard one-year warranty. During the term of the initial one-year warranty, if the device fails to operate properly from defects in materials and workmanship, the Company will fix or replace the defective product. Deferred revenue for separately priced extended warranties one year or less totaled $2,417,342 and $2,627,763 as of March 31, 2024, and December 31, 2023, respectively. Deferred revenue for separately priced extended warranties longer than one year totaled $2,930,779 and $2,974,710 as of March 31, 2024, and December 31, 2023, respectively. The accrual for the one-year manufacturer’s warranty liability totaled $295,000 and $354,000 as of March 31, 2024, and December 31, 2023, respectively. We did see a small downtick in some warranty repairs, due to new quality controls and equipment, so we were able to decrease the accrual for repair expenses. During the three months ended March 31, 2024, and 2023, the Company recognized revenue of $875,044 and $581,975, respectively, related to the extended service-type warranties that was amortized from the deferred revenue balance at the beginning of each period. Changes in deferred revenue amounts related to extended service-type warranties will fluctuate from year to year based upon the average remaining life of the warranties at the beginning of the period and new extended service-type warranties sold during the period.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   Concentration of Credit Risk and Major Customers and Suppliers   Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, certificates of deposit, and accounts receivable.   The Company’s cash, cash equivalents and certificates of deposit are maintained with financial institutions with high credit standings and are FDIC insured deposits. The FDIC insures deposits according to the ownership category in which the funds are insured and how the accounts are titled. The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. The Company had uninsured cash and cash equivalents of $22,415,177 and $18,349,842 as of March 31, 2024, and December 31, 2023, respectively.   Sales are typically made on credit and the Company generally does not require collateral. Management performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Historically, the Company has experienced minimal charges relative to doubtful accounts.   Historically, the Company primarily sells its products to U.S. federal, state and municipal agencies.   As of March 31, 2024, the Company had one customer that accounted for 22% of total accounts receivable. As of December 31, 2023, the Company had customers that accounted for 28% and 14% of total accounts receivable.   For the three months ended March 31, 2024 and 2023, the Company had did not have any single customer that accounted for 10% of total revenue.   Net Income per Common Share   The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows:  Schedule of Earnings Per Share     2024     2023       Three Months Ended March 31       2024     2023                 Net Income   $ 1,216,173     $ 2,946,373   Weighted average common stock outstanding     10,959,298       10,917,311   Incremental shares from stock options     1,890       2,080   Weighted average common stock outstanding, diluted     10,961,188       10,919,391                     Net Income per common share and common equivalent share                 Basic   $ 0.11     $ 0.27   Diluted   $ 0.11     $ 0.27       VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)

v3.24.1.1.u2

Inventory	3 Months Ended
	Mar. 31, 2024
Inventory Disclosure [Abstract]
Inventory	Note 2. Inventory   Inventory consisted of the following as of:  Schedule of Inventory     March 31, 2024     December 31, 2023                 Raw materials and work in process   $ 12,782,747     $ 12,834,368   Reserve     (490,287 )     (429,488 )                   Total Inventory   $ 12,292,460     $ 12,404,880     The Company regularly evaluates the useful life of its spare parts inventory but did not have any cause to reclassify any this quarter.

v3.24.1.1.u2

Property and Equipment	3 Months Ended
	Mar. 31, 2024
Property, Plant and Equipment [Abstract]
Property and Equipment	Note 3. Property and Equipment   Property and equipment consisted of the following as of:  Schedule of Property and Equipment     March 31, 2024     December 31, 2023   Land   $ 1,778,987     $ 1,778,987   Building & Building Improvements     9,146,556       9,146,556   Computer equipment     1,227,378       1,236,989   Furniture and office equipment     314,006       295,208   Machinery and equipment     4,326,010       2,865,014   STEP equipment     2,301,083       2,241,291   Leasehold improvements     358,584       358,584   Construction in Progress     2,470,054       2,456,259                     Total property and equipment     21,922,658       20,375,888   Less: Accumulated depreciation and amortization     (5,123,199 )     (4,888,876 )                   Property and equipment, net   $ 16,799,459     $ 15,487,012     Depreciation expenses, including STEP depreciation, were $234,324 and $195,034 for the three months ended March 31, 2024, and 2023, respectively.

v3.24.1.1.u2

Intangible Assets	3 Months Ended
	Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Note 4. Intangible Assets   Intangible assets consisted of the following as of:  Schedule of Intangible Asset     March 31, 2024     December 31, 2023   Patents   $ 160,000     $ 160,000   Capitalized media content     451,244       451,244   Acquired lease intangible assets     83,963       83,963                     Total intangible assets     695,207       695,207   Less accumulated amortization     (129,889 )     (127,667 )                   Intangible assets, net   $ 565,318     $ 567,540     Amortization expenses were $2,222 and $5,626 for the three months ended March 31, 2024, and 2023, respectively.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)

v3.24.1.1.u2

Leases	3 Months Ended
	Mar. 31, 2024
Leases
Leases	Note 5. Leases   The Company leases approximately 37,729 rentable square feet of office and warehouse space from an unaffiliated third party for our former corporate office, manufacturing, assembly, warehouse, and shipping facility located at 7970 South Kyrene Road, Tempe, Arizona 85284. From 2016 through March 2019, the Company leased approximately 4,529 rentable square feet of office and industrial space from an unaffiliated third party for our machine shop at 2169 East 5th Street, Tempe, Arizona 85284. In April 2019, the Company relocated the machine shop from the 5th Street location to 7910 South Kyrene Road, located within the same business complex as our main office. The Company executed a lease amendment to add an additional 5,131 rentable square feet for the machine shop and extended its existing office lease through April 2024. On June 1, 2022, we entered a new lease of approximately 9,350 square feet located at 12301 Challenger Parkway, Orlando, Florida, from an unaffiliate third party through May 2027.   The Company’s lease agreements do not contain any residual value guarantees, restrictive covenants, or variable lease payments. The Company has not entered into any financing leases.   In addition to base rent, the Company’s lease provides for additional payments for other charges, such as rental tax. The lease includes fixed rent escalations. The Company’s lease does not include an option to renew.   The Company determines if an arrangement is a lease at inception. Operating leases are recorded in operating lease right of use assets, net, operating lease liability – short-term, and operating lease liability – long-term on its balance sheets.   Operating lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company’s lease does not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate used at adoption was 4.5%. Significant judgement is required when determining the Company’s incremental borrowing rate. The Company uses the implicit rate when readily determinable. Lease expense for lease payments is recognized on a straight-line basis over the lease term.   Effective June 1, 2022, the Company obtained a right-of-use asset in exchange for a new operating lease liability of $840,855. Effective January 1, 2019, the Company obtained a right-of-use asset in exchange for a new operating lease liability in the amount of $1,721,380 and derecognized $46,523 deferred rent for an adjusted operating lease right-of-use asset in the net amount of $1,674,857.  Schedule of Balance Sheet Classification of Lease Assets and Liabilities Balance Sheet Classification   March 31, 2024     December 31, 2023   Assets                 Operating lease right-of-use assets, December 31, 2023   $ 716,687     $ 1,212,814   Amortization for the three months ended March 31, 2024     (127,893 )     (496,127 ) Total operating lease right-of-use asset, March 31, 2024   $ 588,794     $ 716,687   Liabilities                 Current                 Operating lease liability, short-term   $ 323,038     $ 317,840   Non-current                 Operating lease liability, long-term     289,687       432,176   Total lease liabilities   $ 612,725     $ 750,016       VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   Future minimum lease payments as of March 31, 2024, under non-cancelable operating leases are as follows:  Schedule of Future Minimum Lease Payments           2024   $ 190,045   2025     191,478   2026     196,311   2027     99,381             Total Lease Payments     677,215   Less: imputed interest     (64,490 ) Operating Lease Liability   $ 612,725     Rent expenses for the three months ended March 31, 2024, and 2023, were $204,235 and $108,230, respectively.

v3.24.1.1.u2

Accrued Expenses	3 Months Ended
	Mar. 31, 2024
Payables and Accruals [Abstract]
Accrued Expenses	Note 6. Accrued Expenses   Accrued compensation and related costs consist of the following as of:  Schedule of Accrued Compensation and Related Costs     March 31, 2024     December 31, 2023   Salaries and wages payable   $ 225,152     $ 457,565   Employee benefits payable     44,261       54,811   Accrued paid time off (PTO)     395,543       361,418   Profit sharing payable     1,511,122       1,347,622                     Total accrued compensation and related costs   $ 2,176,078     $ 2,221,416     Accrued expenses and other current liabilities consist of the following as of:  Schedule of Accrued Expenses and Other Current Liabilities     March 31, 2024     December 31, 2023   Manufacturer’s warranties   $ 295,000     $ 354,000   Taxes payable     3,872,036       3,411,669   Miscellaneous payable     215,325       204,890                     Total accrued expenses and other current liabilities   $ 4,382,361     $ 3,970,559       VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)

v3.24.1.1.u2

Note Payable	3 Months Ended
	Mar. 31, 2024
Debt Disclosure [Abstract]
Note Payable	Note 7. Note Payable   On August 25, 2021, the Company completed the purchase of real property located in Chandler, Arizona (the “Property”) for $10,800,000, paid with cash and proceeds from a mortgage loan from Arizona Bank & Trust in the amount of $8,600,000. The loan terms include interest to be accrued at a fixed rate of 3% per year, 119 regular monthly payments of $40,978, and one irregular payment of $5,956,538 due on the maturity date of August 23, 2031. The Company began making monthly payments on September 23, 2021. The payment and performance of the loan is secured by a security interest in the property acquired.   The note payable amounts consist of the following:  Schedule of Notes Payable     March 31, 2024     December 31, 2023                 Short-term liabilities                 Note payable, principal   $ 221,910     $ 222,320   Accrued interest to date     4,745       4,035                     Note Payable, short-term   $ 226,655     $ 226,355                     Long-term liabilities                 Note payable, principal   $ 7,751,585     $ 7,813,021                     Note payable, long tern   $ 7,751,585     $ 7,813,021

v3.24.1.1.u2

Related Party Transactions	3 Months Ended
	Mar. 31, 2024
Related Party Transactions [Abstract]
Related Party Transactions	Note 8. Related Party Transactions   During the three months ended March 31, 2024, one Board member purchased 2,500 shares of common stock, $0.0001 par value per share (the “Common Stock”), pursuant to the exercise of previously awarded stock options at the exercise price of $10,750.   During the three months ended March 31, 2023, one Board member and the Company’s Executive Chairman (then Co-CEO) purchased 7,500 shares of Common Stock pursuant to the exercise of previously awarded stock options at the exercise price of $2.23 per share, for a total of $16,726.

v3.24.1.1.u2

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 9. Commitments and Contingencies   Litigation   From time to time, the Company is notified of litigation or that a claim is being made against it. The Company evaluates contingencies on an on-going basis and has established loss provisions for matters in which losses are probable and the amount of loss can be reasonably estimated. There is no pending litigation at this time.   Restricted Stock Unit Grants   On August 26, 2021, and April 11, 2022, the Compensation Committee of the Board of Directors granted a total of 392,223, and 288,889 Restricted Stock Units (RSUs), respectively, pursuant to Section 9 of the 2017 Equity Incentive Plan to the co-Chief Executive Officers and the Chief Operating Officer, to be awarded based on achievement of certain performance goals over the next three years. During August 2022, 168,090 Restricted Stock Units were forfeited upon the departure of the Chief Operating Officer.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   On December 1, 2022, the Company granted a total of 15,000 RSUs to its Chief Financial Officer, which can be awarded based on achievement of performance goals over the next three years. On January 1, 2023, the Company issued 42,735 RSUs to a new member of the Board of Directors which can be awarded only upon a sale of the Company.   It is the Company’s policy to estimate the fair value of the RSU’s on the date of the grant and evaluate the probability of achieving the net profit (net income under GAAP) tranches quarterly. If the target is deemed probable, the expense is amortized on a straight-line basis over the remaining period. The Company determined based on the vesting terms described above that the net profit (net income under GAAP) for the twelve months ending June 30, 2023, was $4,564,459 and therefore awarded 22,988 (prior to deduction of 9,142 shares to pay the tax withholding liability) and 29,630 (prior to the deduction of 11,394 shares to pay the tax withholding liability) shares of common stock to its Executive Chairman and CEO, respectively. The Company determined based on the vesting terms described above that the net profit (net income under GAAP) for the twelve months ending June 30, 2024, of $5,000,000 is probable and recorded expenses of $139,998 related to the RSUs for the three months ended March 31, 2024.   Profit Sharing   VirTra provides a discretionary profit-sharing program that pays out a percentage of Company profits each year as a cash bonus to eligible employees. The cash payment is typically split into two equal payments and distributed pro-rata in April and October of the following year to only active employees. For the three months ended March 31, 2024, and 2023, $163,500 and $150,000 was expensed to operations for profit sharing.

v3.24.1.1.u2

Stockholders’ Equity	3 Months Ended
	Mar. 31, 2024
Equity [Abstract]
Stockholders’ Equity	Note 10. Stockholders’ Equity   Stock Repurchase   On October 25, 2016, the Company’s Board of Directors authorized the repurchase of up to $1 million of its common stock under Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended. Purchases made pursuant to this authorization will be made in the open market, in privately negotiated transactions, or pursuant to any trading plan that may be adopted in accordance with Rule 10b-18. The timing, manner, price, and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements, and other factors. On January 9, 2019, VirTra’s Board of Directors authorized an additional $1 million be allocated for the repurchase of VirTra’s stock under the existing 10b-18 plan. The stock repurchase program was suspended due to interim rulings for public-company recipients of a PPP loan under the CARES Act. Although the Company’s PPP loan was forgiven on July 20, 2021, the suspension of the stock repurchase program continues to remain in effect.   Non-qualified Stock Options   The Company has periodically issued non-qualified stock options to key employees, officers and directors under a stock option compensation plan approved by the Board of Directors in 2009. Terms of option grants are at the discretion of the Board of Directors and are generally seven years. Upon the exercise of these options, the Company expects to issue new authorized shares of its common stock. The following table summarizes all non-qualified stock options as of:  Schedule of Non-qualified Stock Options     March 31,2024     December 31, 2023       Number of Stock Options     Weighted Exercise Price     Number of Stock Options     Weighted Exercise Price   Options outstanding, beginning of year     15,000     $ 4.03       45,000     $ 4.26   Granted     -       -       -       -   Redeemed     (5,000 )     4.3       (15,000 )     5.09   Exercised     (2,500 )     4.3       (15,000 )     3.66   Expired / terminated     -       -       -       -   Options outstanding, end of period     7,500     $ 3.76       15,000     $ 4.03   Options exercisable, end of period     7,500     $ 3.76       15,000     $ 4.03     The Company did not have any non-vested stock options outstanding as of March 31, 2024, and December 31, 2023. The weighted average contractual term for options outstanding and exercisable on March 31, 2024, and 2023 was 7 years. The aggregate intrinsic value of the options outstanding and exercisable on March 31, 2024, and 2023 was $28,875 and $1,800, respectively. For the three months ended March 31, 2024, and 2023, the Company received payments related to the exercise of options in the amount of $10,750 and $16,726, respectively. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the Company’s common stock for those stock options that have an exercise price lower than the fair value of the Company’s common stock. Options with an exercise price above the fair value of the Company’s common stock are considered of no intrinsic value.   2017 Equity Incentive Plan   Through March 31, 2024, 224,133 and 288,889 restricted stock units (RSUs) have been granted under the Equity Plan to the Company’s Executive Chairman and CEO, respectively, of which 17,753 and 158,976 shares were issued in settlement of such RSUs. Also, 10,543 and 14,057 restricted shares were issued to the Company’s former COO and Executive Chairman.   Common stock activity   During the three months ended March 31, 2024, one Board member purchased 2,500 shares of Common Stock pursuant to the exercise of previously awarded stock options at the exercise price of $4.30 per share, for a total of $10,750.

v3.24.1.1.u2

Subsequent Events	3 Months Ended
	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent Events	Note 11. Subsequent Events   None

v3.24.1.1.u2

Organization and Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Organization and Business Operations	Organization and Business Operations   VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” or “our”), located in Chandler, Arizona, is a global provider of judgmental use of force training simulators and 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. The Company sells its products worldwide through a direct sales force and international distribution partners. The original business started in 1993 as Ferris Productions, Inc and ultimately became VirTra, Inc., a Nevada corporation.
Basis of Presentation	Basis of Presentation   The unaudited financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on April 1, 2024. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading.   The accompanying unaudited financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position on March 31, 2024, and the results of our operations and cash flows for the periods presented. We derived the December 31, 2023, balance sheet data from audited financial statements; however, we did not include all disclosures required by GAAP.   Interim results are subject to seasonal variations, and the results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the full year.
Use of Estimates	Use of Estimates   The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets and intangible assets, income tax valuation allowances, and the allocation of the transaction price to the performance obligations in our contracts with customers.
Revenue Recognition	Revenue Recognition   The Company adopted the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customer (Topic 606) (“ASC 606”) on January 1, 2018, and the Company elected to use the modified retrospective transition method which requires application of ASC 606 to uncompleted contracts at the date of adoption. The adoption of ASC 606 did not have a material impact on the financial statements.   Under ASC 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant judgment is necessary when making these determinations.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)   The Company’s primary sources of revenue are derived from simulator and accessories sales, training and installation, the sale of customizable software and the sale of extended service-type warranties. The Company’s policy is to typically invoice upon completion of installation and/or training until such a time the performance obligations that have been satisfied are included in unbilled. Sales discounts are presented in the financial statements as reductions in determining net revenues. Credit sales are recorded as current assets (accounts receivable and unbilled revenue). Prepaid deposits received at the time of sale and extended warranties purchased are recorded as current and long-term liabilities (deferred revenue) until earned. The following briefly summarizes the nature of our performance obligations and method of revenue recognition:   Performance Obligation   Method of Recognition       Simulator and accessories   Upon transfer of control       STEP Program   Deferred and recognized over the life of the contract       Installation and training   Upon completion or over the period of services being rendered       Extended service-type warranty   Deferred and recognized over the life of the extended warranty       Customized software and content   Upon transfer of control or over the period services are performed depending on the terms of the contract       Customized content scenario   As performance obligation is transferred over time (input method using time and materials expanded)       Design and prototyping   Recognized at the completion of each agreed upon milestone       Sales-based royalty exchanged for license of intellectual property   Recognized as the performance obligation is satisfied over time – which is as the sales occur.   The Company recognizes revenue upon transfer of control or upon completion of the services for the simulator and accessories; for the installation and training and customized software performance obligations as the customer has the right and ability to direct the use of these products and services and the customer obtains all of the remaining benefit from these products and services at that time. Revenue from certain customized content contracts may be recognized over the period the services are performed based on the terms of the contract. For the sales-based royalty exchanged for license of intellectual property, the Company recognized revenue as the sales occur over time.   The Company recognizes revenue on a straight-line basis over the period of services being rendered for the extended service-type warranties as these warranties represent a performance obligation to “stand ready to perform” over the duration of the warranties. As such, the warranty service is performed continuously over the warranty period.   Each contract states the transaction price. The contracts do not include variable consideration, significant financing components or noncash consideration. The Company has elected to exclude sales and similar taxes from the measurement of the transaction price. The contract’s transaction price is allocated to the performance obligations based upon their stand-alone selling prices. Discounts on the stand-alone selling prices, if any, are allocated proportionately to each performance obligation.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)
Disaggregation of Revenue	Disaggregation of Revenue   Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation.  Schedule of Disaggregation of Revenue     Commercial     Government     International     Total     Commercial     Government     International     Total       Three Months Ended March 31       2024     2023       Commercial     Government     International     Total     Commercial     Government     International     Total   Simulators and accessories   $ 75,780     $ 3,811,257     $ 1,278,257     $ 5,165,294     $ 489,810     $ 4,749,368     $ 3,134,628     $ 8,373,806   Extended Service-type warranties     -       870,803       4,202       875,005       23,343       539,208       19,424       581,975   Customized software and content     -       265,406       -       265,406       19,500       7,196       (16,861 )     9,835   Installation and training     -       236,339       5,164       241,503       20,562       249,554       53,688       323,804   Design & Prototyping     -       583,326       -       583,326       -       -       -       -   STEP     -       954,349       9,515       963,864       -       730,273       7,242       737,515   Total Revenue   $ 75,780     $ 6,721,480     $ 1,297,138     $ 8,094,398     $ 553,215     $ 6,275,599     $ 3,198,121     $ 10,026,935     Commercial customers include selling through prime contractors for military or law enforcement contracts domestically and until it becomes a larger portion of the revenue will include any healthcare sales.  Government customers are defined as directly selling to government agencies. For the three months ended March 31, 2024, governmental customers comprised $6,721,480, or 83% of total net sales, commercial customers comprised $75,780 or 1% of total net sales and international customers comprised $1,297,138 or 16% of total net sales. By comparison, for the three months ended March 31, 2023, governmental customers comprised $6,275,599, or 63% of total net sales, commercial customers comprised $553,215 or 5% of total net sales and international customers comprised $3,198,121, or 32% of total net sales. For the three months ended March 31, 2024, and 2023, the Company recorded $963,864 and $737,515, respectively, in STEP revenue, or 12% and 7%, respectively, of total net sales.
Customer Deposits	Customer Deposits   Customer deposits consist of prepaid deposits received for equipment purchase orders and for Subscription Training Equipment Partnership (“STEP”) operating agreements that expire annually. Customer deposits are considered a deferred liability until the completion of the customer’s contract performance obligation. When revenue is recognized, the deposit is applied to the customer’s receivable balance. Customer deposits are recorded as a current liability under deferred revenue on the accompanying balance sheet and totaled $1,534,268 and $2,092,095 on March 31, 2024, and December 31, 2023, respectively. Changes in deferred revenue amounts related to customer deposits will fluctuate from year to year based upon the mix of customers required to prepay deposits under the Company’s credit policy. The decrease in deferred revenue from December was due to the Company converting the deposits into revenue as we delivered on our obligations.
Warranty	Warranty   The Company warranties its products from manufacturing defects on a limited basis for a period of one year after purchase, but also sells separately priced extended service-type warranties for periods of up to four years after the expiration of the standard one-year warranty. During the term of the initial one-year warranty, if the device fails to operate properly from defects in materials and workmanship, the Company will fix or replace the defective product. Deferred revenue for separately priced extended warranties one year or less totaled $2,417,342 and $2,627,763 as of March 31, 2024, and December 31, 2023, respectively. Deferred revenue for separately priced extended warranties longer than one year totaled $2,930,779 and $2,974,710 as of March 31, 2024, and December 31, 2023, respectively. The accrual for the one-year manufacturer’s warranty liability totaled $295,000 and $354,000 as of March 31, 2024, and December 31, 2023, respectively. We did see a small downtick in some warranty repairs, due to new quality controls and equipment, so we were able to decrease the accrual for repair expenses. During the three months ended March 31, 2024, and 2023, the Company recognized revenue of $875,044 and $581,975, respectively, related to the extended service-type warranties that was amortized from the deferred revenue balance at the beginning of each period. Changes in deferred revenue amounts related to extended service-type warranties will fluctuate from year to year based upon the average remaining life of the warranties at the beginning of the period and new extended service-type warranties sold during the period.     VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)
Concentration of Credit Risk and Major Customers and Suppliers	Concentration of Credit Risk and Major Customers and Suppliers   Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, certificates of deposit, and accounts receivable.   The Company’s cash, cash equivalents and certificates of deposit are maintained with financial institutions with high credit standings and are FDIC insured deposits. The FDIC insures deposits according to the ownership category in which the funds are insured and how the accounts are titled. The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. The Company had uninsured cash and cash equivalents of $22,415,177 and $18,349,842 as of March 31, 2024, and December 31, 2023, respectively.   Sales are typically made on credit and the Company generally does not require collateral. Management performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Historically, the Company has experienced minimal charges relative to doubtful accounts.   Historically, the Company primarily sells its products to U.S. federal, state and municipal agencies.   As of March 31, 2024, the Company had one customer that accounted for 22% of total accounts receivable. As of December 31, 2023, the Company had customers that accounted for 28% and 14% of total accounts receivable.   For the three months ended March 31, 2024 and 2023, the Company had did not have any single customer that accounted for 10% of total revenue.
Net Income per Common Share	Net Income per Common Share   The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows:  Schedule of Earnings Per Share     2024     2023       Three Months Ended March 31       2024     2023                 Net Income   $ 1,216,173     $ 2,946,373   Weighted average common stock outstanding     10,959,298       10,917,311   Incremental shares from stock options     1,890       2,080   Weighted average common stock outstanding, diluted     10,961,188       10,919,391                     Net Income per common share and common equivalent share                 Basic   $ 0.11     $ 0.27   Diluted   $ 0.11     $ 0.27       VIRTRA, INC. NOTE TO FINANCIAL STATEMENTS (Unaudited)

v3.24.1.1.u2

Organization and Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Schedule of Disaggregation of Revenue	Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation.  Schedule of Disaggregation of Revenue     Commercial     Government     International     Total     Commercial     Government     International     Total       Three Months Ended March 31       2024     2023       Commercial     Government     International     Total     Commercial     Government     International     Total   Simulators and accessories   $ 75,780     $ 3,811,257     $ 1,278,257     $ 5,165,294     $ 489,810     $ 4,749,368     $ 3,134,628     $ 8,373,806   Extended Service-type warranties     -       870,803       4,202       875,005       23,343       539,208       19,424       581,975   Customized software and content     -       265,406       -       265,406       19,500       7,196       (16,861 )     9,835   Installation and training     -       236,339       5,164       241,503       20,562       249,554       53,688       323,804   Design & Prototyping     -       583,326       -       583,326       -       -       -       -   STEP     -       954,349       9,515       963,864       -       730,273       7,242       737,515   Total Revenue   $ 75,780     $ 6,721,480     $ 1,297,138     $ 8,094,398     $ 553,215     $ 6,275,599     $ 3,198,121     $ 10,026,935
Schedule of Earnings Per Share	The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows:  Schedule of Earnings Per Share     2024     2023       Three Months Ended March 31       2024     2023                 Net Income   $ 1,216,173     $ 2,946,373   Weighted average common stock outstanding     10,959,298       10,917,311   Incremental shares from stock options     1,890       2,080   Weighted average common stock outstanding, diluted     10,961,188       10,919,391                     Net Income per common share and common equivalent share                 Basic   $ 0.11     $ 0.27   Diluted   $ 0.11     $ 0.27

v3.24.1.1.u2

Inventory (Tables)	3 Months Ended
	Mar. 31, 2024
Inventory Disclosure [Abstract]
Schedule of Inventory	Inventory consisted of the following as of:  Schedule of Inventory     March 31, 2024     December 31, 2023                 Raw materials and work in process   $ 12,782,747     $ 12,834,368   Reserve     (490,287 )     (429,488 )                   Total Inventory   $ 12,292,460     $ 12,404,880

v3.24.1.1.u2

Property and Equipment (Tables)	3 Months Ended
	Mar. 31, 2024
Property, Plant and Equipment [Abstract]
Schedule of Property and Equipment	Property and equipment consisted of the following as of:  Schedule of Property and Equipment     March 31, 2024     December 31, 2023   Land   $ 1,778,987     $ 1,778,987   Building & Building Improvements     9,146,556       9,146,556   Computer equipment     1,227,378       1,236,989   Furniture and office equipment     314,006       295,208   Machinery and equipment     4,326,010       2,865,014   STEP equipment     2,301,083       2,241,291   Leasehold improvements     358,584       358,584   Construction in Progress     2,470,054       2,456,259                     Total property and equipment     21,922,658       20,375,888   Less: Accumulated depreciation and amortization     (5,123,199 )     (4,888,876 )                   Property and equipment, net   $ 16,799,459     $ 15,487,012

v3.24.1.1.u2

Intangible Assets (Tables)	3 Months Ended
	Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Intangible Asset	Intangible assets consisted of the following as of:  Schedule of Intangible Asset     March 31, 2024     December 31, 2023   Patents   $ 160,000     $ 160,000   Capitalized media content     451,244       451,244   Acquired lease intangible assets     83,963       83,963                     Total intangible assets     695,207       695,207   Less accumulated amortization     (129,889 )     (127,667 )                   Intangible assets, net   $ 565,318     $ 567,540

v3.24.1.1.u2

Leases (Tables)	3 Months Ended
	Mar. 31, 2024
Leases
Schedule of Balance Sheet Classification of Lease Assets and Liabilities	Schedule of Balance Sheet Classification of Lease Assets and Liabilities Balance Sheet Classification   March 31, 2024     December 31, 2023   Assets                 Operating lease right-of-use assets, December 31, 2023   $ 716,687     $ 1,212,814   Amortization for the three months ended March 31, 2024     (127,893 )     (496,127 ) Total operating lease right-of-use asset, March 31, 2024   $ 588,794     $ 716,687   Liabilities                 Current                 Operating lease liability, short-term   $ 323,038     $ 317,840   Non-current                 Operating lease liability, long-term     289,687       432,176   Total lease liabilities   $ 612,725     $ 750,016
Schedule of Future Minimum Lease Payments	Future minimum lease payments as of March 31, 2024, under non-cancelable operating leases are as follows:  Schedule of Future Minimum Lease Payments           2024   $ 190,045   2025     191,478   2026     196,311   2027     99,381             Total Lease Payments     677,215   Less: imputed interest     (64,490 ) Operating Lease Liability   $ 612,725

v3.24.1.1.u2

Accrued Expenses (Tables)	3 Months Ended
	Mar. 31, 2024
Payables and Accruals [Abstract]
Schedule of Accrued Compensation and Related Costs	Accrued compensation and related costs consist of the following as of:  Schedule of Accrued Compensation and Related Costs     March 31, 2024     December 31, 2023   Salaries and wages payable   $ 225,152     $ 457,565   Employee benefits payable     44,261       54,811   Accrued paid time off (PTO)     395,543       361,418   Profit sharing payable     1,511,122       1,347,622                     Total accrued compensation and related costs   $ 2,176,078     $ 2,221,416
Schedule of Accrued Expenses and Other Current Liabilities	Accrued expenses and other current liabilities consist of the following as of:  Schedule of Accrued Expenses and Other Current Liabilities     March 31, 2024     December 31, 2023   Manufacturer’s warranties   $ 295,000     $ 354,000   Taxes payable     3,872,036       3,411,669   Miscellaneous payable     215,325       204,890                     Total accrued expenses and other current liabilities   $ 4,382,361     $ 3,970,559

v3.24.1.1.u2

Note Payable (Tables)	3 Months Ended
	Mar. 31, 2024
Debt Disclosure [Abstract]
Schedule of Notes Payable	The note payable amounts consist of the following:  Schedule of Notes Payable     March 31, 2024     December 31, 2023                 Short-term liabilities                 Note payable, principal   $ 221,910     $ 222,320   Accrued interest to date     4,745       4,035                     Note Payable, short-term   $ 226,655     $ 226,355                     Long-term liabilities                 Note payable, principal   $ 7,751,585     $ 7,813,021                     Note payable, long tern   $ 7,751,585     $ 7,813,021

v3.24.1.1.u2

Stockholders’ Equity (Tables)	3 Months Ended
	Mar. 31, 2024
Equity [Abstract]
Schedule of Non-qualified Stock Options	Schedule of Non-qualified Stock Options     March 31,2024     December 31, 2023       Number of Stock Options     Weighted Exercise Price     Number of Stock Options     Weighted Exercise Price   Options outstanding, beginning of year     15,000     $ 4.03       45,000     $ 4.26   Granted     -       -       -       -   Redeemed     (5,000 )     4.3       (15,000 )     5.09   Exercised     (2,500 )     4.3       (15,000 )     3.66   Expired / terminated     -       -       -       -   Options outstanding, end of period     7,500     $ 3.76       15,000     $ 4.03   Options exercisable, end of period     7,500     $ 3.76       15,000     $ 4.03

v3.24.1.1.u2

Schedule of Disaggregation of Revenue (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Simulators and accessories	$ 5,165,294	$ 8,373,806
Extended Service-type warranties	875,005	581,975
Customized software and content	265,406	9,835
Installation and training	241,503	323,804
Design & Prototyping	583,326
STEP	963,864	737,515
Total Revenue	8,094,398	10,026,935
Commercial [Member]
Simulators and accessories	75,780	489,810
Extended Service-type warranties		23,343
Customized software and content		19,500
Installation and training		20,562
Design & Prototyping
STEP
Total Revenue	75,780	553,215
Government [Member]
Simulators and accessories	3,811,257	4,749,368
Extended Service-type warranties	870,803	539,208
Customized software and content	265,406	7,196
Installation and training	236,339	249,554
Design & Prototyping	583,326
STEP	954,349	730,273
Total Revenue	6,721,480	6,275,599
Geographic Distribution, Foreign [Member]
Simulators and accessories	1,278,257	3,134,628
Extended Service-type warranties	4,202	19,424
Customized software and content		(16,861)
Installation and training	5,164	53,688
Design & Prototyping
STEP	9,515	7,242
Total Revenue	$ 1,297,138	$ 3,198,121

v3.24.1.1.u2

Schedule of Earnings Per Share (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Accounting Policies [Abstract]
Net Income	$ 1,216,173	$ 2,946,373
Weighted average common stock outstanding	10,959,298	10,917,311
Incremental shares from stock options	1,890	2,080
Weighted average common stock outstanding, diluted	10,961,188	10,919,391
Basic	$ 0.11	$ 0.27
Diluted	$ 0.11	$ 0.27

v3.24.1.1.u2

Organization and Significant Accounting Policies (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Product Information [Line Items]
Revenue	$ 8,094,398	$ 10,026,935
Customer deposits, current	5,538,525		$ 6,736,175
Revenue recognized	875,044	581,975
FDIC insured amount	250,000
Uninsured cash and cash equivalents	22,415,177		18,349,842
Warranty [Member] | One Year or Less [Member]
Product Information [Line Items]
Extended warranties	2,417,342		2,627,763
Warranty [Member] | Longer Than One Year [Member]
Product Information [Line Items]
Extended warranties	2,930,779		2,974,710
Warranty [Member] | One Year [Member]
Product Information [Line Items]
Extended warranties	295,000		354,000
Deferred Revenue [Member]
Product Information [Line Items]
Customer deposits, current	1,534,268		$ 2,092,095
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Government Customers [Member]
Product Information [Line Items]
Revenue	$ 6,721,480	$ 6,275,599
Concentration of credit risk percentage	83.00%	63.00%
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Commercial Customers [Member]
Product Information [Line Items]
Revenue	$ 75,780	$ 553,215
Concentration of credit risk percentage	1.00%	5.00%
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | International Customers [Member]
Product Information [Line Items]
Revenue	$ 1,297,138	$ 3,198,121
Concentration of credit risk percentage	16.00%	32.00%
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | STEP Revenue [Member]
Product Information [Line Items]
Revenue	$ 963,864	$ 737,515
Concentration of credit risk percentage	12.00%	7.00%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | One Customer [Member]
Product Information [Line Items]
Concentration of credit risk percentage	22.00%		28.00%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customer [Member]
Product Information [Line Items]
Concentration of credit risk percentage			14.00%
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | One Customer [Member]
Product Information [Line Items]
Concentration of credit risk percentage	10.00%	10.00%

v3.24.1.1.u2

Schedule of Inventory (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Raw materials and work in process	$ 12,782,747	$ 12,834,368
Reserve	(490,287)	(429,488)
Total Inventory	$ 12,292,460	$ 12,404,880

v3.24.1.1.u2

Schedule of Property and Equipment (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 21,922,658	$ 20,375,888
Less: Accumulated depreciation and amortization	(5,123,199)	(4,888,876)
Total property and equipment	16,799,459	15,487,012
Land [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	1,778,987	1,778,987
Building and Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	9,146,556	9,146,556
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	1,227,378	1,236,989
Furniture And Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	314,006	295,208
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	4,326,010	2,865,014
STEP Equipment [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	2,301,083	2,241,291
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	358,584	358,584
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 2,470,054	$ 2,456,259

v3.24.1.1.u2

Property and Equipment (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation	$ 234,324	$ 195,034

v3.24.1.1.u2

Schedule of Intangible Asset (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 695,207	$ 695,207
Less accumulated amortization	(129,889)	(127,667)
Intangible assets, net	565,318	567,540
Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangible assets	160,000	160,000
Capitalized Media Content [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangible assets	451,244	451,244
Acquired Lease Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 83,963	$ 83,963

v3.24.1.1.u2

Intangible Assets (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible asset	$ 2,222	$ 5,626

v3.24.1.1.u2

Schedule of Balance Sheet Classification of Lease Assets and Liabilities (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Leases
Operating lease right-of-use assets, December 31, 2023	$ 716,687	$ 1,212,814	$ 1,212,814
Amortization for the three months ended March 31, 2024	(127,893)	$ (121,774)	(496,127)
Total operating lease right-of-use asset, March 31, 2024	588,794		716,687
Operating lease liability, short-term	323,038		317,840
Operating lease liability, long-term	289,687		432,176
Total lease liabilities	$ 612,725		$ 750,016

v3.24.1.1.u2

Schedule of Future Minimum Lease Payments (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Leases
2024	$ 190,045
2025	191,478
2026	196,311
2027	99,381
Total Lease Payments	677,215
Less: imputed interest	(64,490)
Operating Lease Liability	$ 612,725	$ 750,016

v3.24.1.1.u2

Leases (Details Narrative)			3 Months Ended
	Jun. 01, 2022 USD ($) ft²	Jan. 01, 2019 USD ($)	Mar. 31, 2024 USD ($) ft²	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Apr. 30, 2019 ft²	Mar. 31, 2019 ft²
Real Estate Properties [Line Items]
Incremental in borrowing rate			4.50%
Right-of-use asset in exchange a operating lease liability	$ 840,855	$ 1,721,380
Deferred rent		46,523
Operating lease right of use asset		$ 1,674,857	$ 588,794		$ 716,687	$ 1,212,814
Rent expenses			$ 204,235	$ 108,230
Office and Warehouse Space [Member] | Unaffiliated Third Party [Member]
Real Estate Properties [Line Items]
Rentable square feet | ft²			37,729
Office and Industrial Space [Member] | Unaffiliated Third Party [Member]
Real Estate Properties [Line Items]
Rentable square feet | ft²	9,350						5,131	4,529

v3.24.1.1.u2

Schedule of Accrued Compensation and Related Costs (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Salaries and wages payable	$ 225,152	$ 457,565
Employee benefits payable	44,261	54,811
Accrued paid time off (PTO)	395,543	361,418
Profit sharing payable	1,511,122	1,347,622
Total accrued compensation and related costs	$ 2,176,078	$ 2,221,416

v3.24.1.1.u2

Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Manufacturer’s warranties	$ 295,000	$ 354,000
Taxes payable	3,872,036	3,411,669
Miscellaneous payable	215,325	204,890
Total accrued expenses and other current liabilities	$ 4,382,361	$ 3,970,559

v3.24.1.1.u2

Schedule of Notes Payable (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Short-Term Debt [Line Items]
Note Payable, short-term	$ 226,655	$ 226,355
Note payable, long tern	7,751,585	7,813,021
Notes Payable [Member]
Short-Term Debt [Line Items]
Note payable, principal	7,751,585	7,813,021
Notes Payable [Member]
Short-Term Debt [Line Items]
Note payable, principal	221,910	222,320
Accrued interest to date	$ 4,745	$ 4,035

v3.24.1.1.u2

Note Payable (Details Narrative)	Aug. 25, 2021 USD ($)
Arizona Bank & Trust [Member]
Short-Term Debt [Line Items]
Proceeds from bank loan	$ 8,600,000
Debt instrument interest rate	3.00%
Arizona Bank & Trust [Member] | 199 Regular Monthly Payments [Member]
Short-Term Debt [Line Items]
Debt instrument periodic payment	$ 40,978
Arizona Bank & Trust [Member] | One Irregular Payment [Member]
Short-Term Debt [Line Items]
Debt instrument periodic payment	$ 5,956,538
Maturity date	Aug. 23, 2031
Property [Member]
Short-Term Debt [Line Items]
Payment to acquire assets	$ 10,800,000

v3.24.1.1.u2

Related Party Transactions (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Shares par value	$ 0.0001		$ 0.0001
Director [Member] | Common Stock [Member]
Shares issued	2,500
Shares par value	$ 0.0001
Shares issued value	$ 10,750
Chief Executive Officer [Member] | Common Stock [Member]
Shares issued		7,500
Shares issued value		$ 16,726
Exercise price		$ 2.23

v3.24.1.1.u2

Commitments and Contingencies (Details Narrative) - USD ($)					1 Months Ended	3 Months Ended		12 Months Ended
	Jan. 01, 2023	Dec. 01, 2022	Apr. 11, 2022	Aug. 26, 2021	Aug. 31, 2022	Mar. 31, 2024	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Net income loss						$ 1,216,173	$ 2,946,373
Share based compensation						139,999	24,063
Operating expenses						4,063,802	3,477,633
Deferred Profit Sharing [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Operating expenses						163,500	$ 150,000
Executive Chairman [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares awarded									22,988
Shares to pay the tax withholding liability									9,142
Chief Executive Officer [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares awarded									29,630
Shares to pay the tax withholding liability									11,394
Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Net income loss									$ 4,564,459
Share based compensation						$ 139,998
Restricted Stock Units (RSUs) [Member] | Forecast [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Net income loss								$ 5,000,000
Restricted Stock Units (RSUs) [Member] | Chief Financial Officer [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted		15,000
Restricted Stock Units (RSUs) [Member] | New Member of Board of Directors [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted	42,735
2017 Equity Incentive Plan [Member] | Chief Operating Officer [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock of restricted stock units forfeited					168,090
2017 Equity Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | Co-Chief Executive Officer and Chief Operating Officer[Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted			288,889	392,223

v3.24.1.1.u2

Schedule of Non-qualified Stock Options (Details) - Non Qualified Stock Option [Member] - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Offsetting Assets [Line Items]
Number of Stock Options, Options outstanding, beginning of year	15,000	45,000
Weighted Exercise Price, Option outstanding, beginning of year	$ 4.03	$ 4.26
Number of Stock Options, Granted
Weighted Exercise Price, Granted
Number of Stock Options, Redeemed	(5,000)	(15,000)
Weighted Exercise Price, Redeemed	$ 4.3	$ 5.09
Number of Stock Options, Exercised	(2,500)	(15,000)
Weighted Exercise Price, Exercised	$ 4.3	$ 3.66
Number of Stock Options, Expired / terminated
Weighted Exercise Price, Expired / terminated
Number of Stock Options, Options outstanding, End of the year	7,500	15,000
Weighted Exercise Price, Option outstanding end of quarter	$ 3.76	$ 4.03
Number of Stock Options, Options exercisable, end of year	7,500	15,000
Weighted Exercise Price, Options exercisable, end of quarter	$ 3.76	$ 4.03

v3.24.1.1.u2

Stockholders’ Equity (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Jan. 09, 2019	Oct. 25, 2016
Class of Stock [Line Items]
Weighted average contractual term for options outstanding and exercisable	7 years	7 years
Options outstanding and exercisable	$ 28,875	$ 1,800
Payments related exercise options	10,750	16,726
Common Stock [Member]
Class of Stock [Line Items]
Payments related exercise options	$ 1	$ 1
Board Member [Member] | Common Stock [Member]
Class of Stock [Line Items]
Number of shares issued	2,500
Stock options exercise, price	$ 4.30
Stock options value	$ 10,750
2017 Equity Incentive Plan [Member] | Executive Chairman [Member]
Class of Stock [Line Items]
Number of restricted shares granted	224,133
Number of shares issued	17,753
2017 Equity Incentive Plan [Member] | Chief Executive Officer [Member]
Class of Stock [Line Items]
Number of restricted shares granted	288,889
Number of shares issued	158,976
2017 Equity Incentive Plan [Member] | Chief Executive Officer [Member] | Restricted Stock Units (RSUs) [Member]
Class of Stock [Line Items]
Number of shares issued	14,057
2017 Equity Incentive Plan [Member] | Chief Operating Officer [Member] | Restricted Stock Units (RSUs) [Member]
Class of Stock [Line Items]
Number of shares issued	10,543
Common Stock [Member] | Chief Executive Officer [Member]
Class of Stock [Line Items]
Number of shares issued		7,500
Stock options value		$ 16,726
Common Stock [Member] | Maximum [Member]
Class of Stock [Line Items]
Stock repurchase value authorized			$ 1,000,000	$ 1,000,000

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