Wrap Technologies (NASDAQ:WRAP) reported second-quarter revenue of $2.1 million, up 103% from $1.0 million a year earlier, as the company highlighted expanding product offerings, new training services and opportunities in private security, federal markets and threat detection.
Gross profit rose 217% to $1.5 million, while gross margin expanded to about 75% from approximately 48% in the prior-year quarter. The company’s operating loss narrowed 21% to $2.3 million, and its net loss improved 39% to $2.3 million. Vice President of Finance Lou Springer said the prior-year period included a $0.9 million non-cash loss tied to changes in the fair value of warrant liabilities that did not recur.
ATF Decision Opens Private-Security Focus
Chief Executive Officer Scot Cohen said the company is coming off its “best quarter in years,” citing revenue growth, improved operating efficiency and an expansion from a single-product business into a broader portfolio of products and training services.
A central development cited by management was an early-July determination from the Bureau of Alcohol, Tobacco, Firearms and Explosives that the BolaWrap 150 is not classified as a firearm or weapon. President and Chief Operating Officer Jared Novick said the determination applies only to the BolaWrap 150 and not to the company’s other products.
Management said the classification could broaden the company’s ability to sell into private security, where many guards are unarmed and receive less training than law-enforcement officers. Novick said there are more than 1.2 million licensed security officers in the United States, a population larger than all law enforcement.
Cohen said Wrap has held dozens of discussions with prospective private-sector customers in the past month and has received its first grant-funded training order in the market. He also said the company expects insurance companies to become an important part of its go-to-market effort, particularly as customers look for risk-mitigation tools and training.
“Expect partnerships. Expect additional pipeline,” Cohen said regarding the insurance opportunity.
Training Model Shifts Toward Recurring Revenue
Novick said the company is seeking to sell a continuing standard of readiness rather than simply a restraint device and a one-day training course. The company launched its WrapTactics training platform earlier this year, and Novick said its core content library was complete as of the call.
The model uses digital instruction in advance of in-person sessions, allowing classroom time to focus on scenario work, coaching, certification and customer relationships. Management expects the learning management system, in-person instruction and virtual-reality offerings to support subscription-based recurring training and proficiency revenue.
Novick said Wrap Reality, the company’s virtual-reality training platform, remains central to its offering. The company has added scenarios and made hardware and software updates, he said, while positioning the platform alongside digital learning and in-person training.
Federal Funding and Frenel Opportunity
Management also pointed to the return of Department of Justice grant funding. Cohen said Wrap has identified 11 active programs that could fund BolaWrap devices, body cameras, de-escalation training and virtual training. He said grants are particularly important for small and midsize law-enforcement agencies.
Novick said Wrap received a purchase order from the Department of Homeland Security and delivered training during the second quarter, completing what the company believes was an initial phase of support for DHS operational requirements. He said prospective federal opportunities are not included in the company’s guidance.
Separately, Wrap is pursuing a threat-detection business through its exclusive U.S. and NATO rights to TPiCore by Frenel, a polarimetric sensing technology. Cohen said the technology can detect, identify and classify objects based on materials and shapes, including RF-silent and camouflaged targets in challenging environments.
Management said the technology could have applications in counter-drone operations, border security, maritime surveillance, national defense and public safety. The company is building what it calls the WrapShield platform around integrated solutions, although executives did not provide financial projections for the initiative.
Outlook and Capital Considerations
Cohen said the company has not changed its prior target for approximately 100% year-over-year revenue growth and has no new information requiring an update. However, he cautioned that the timing of one or two significant orders could materially affect the company’s results and that the target could move higher or lower as the year progresses.
Regarding Chile, Cohen said the company’s distributor still expects business this year but has cited a government funding gap. Wrap is exploring whether U.S. government funding could support the opportunity, but Cohen said Chilean business is not included in the company’s 2026 revenue forecast.
On financing, Cohen said Wrap regularly evaluates options that could benefit shareholders and remains sensitive to dilution. The company is operating around a $3 million break-even level and does not anticipate a dramatic near-term increase in spending. Still, Cohen said management could accelerate investment and potentially access capital markets if market traction develops as expected.
About Wrap Technologies (NASDAQ:WRAP)
Wrap Technologies, Inc (NASDAQ: WRAP) is a designer and manufacturer of less-lethal restraint devices aimed at law enforcement and security professionals. Its flagship product, the BolaWrap®, is a handheld remote restraint tool that deploys a Kevlar-reinforced cord to safely immobilize individuals from a distance of up to 25 feet. The system is engineered to support de-escalation tactics and reduce reliance on physical force in high-risk encounters.
Based in Scottsdale, Arizona, Wrap Technologies oversees product development, testing and training at its headquarters.
