Second Quarter 2026
Filed Aug 11, 2026Sequential revenue growth and the acquisition of VigilAigent enhance revenue quality and visibility while accelerating the Company's path to profitability
Revenue increased 64% sequentially but decreased 22% from the prior-year period. Gross margin declined to 66%, net loss widened to $ (2,596) (in thousands), and cash and cash equivalents were $ 182 (in thousands) at June 30, 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| RevenueGAAP | $ 1,453 | increase of 64% | decrease of 22% |
| Cost of revenueGAAP | 488 | – | – |
| Gross profitGAAP | 965 | – | – |
| Gross profit marginGAAP | 66% | – | – |
| Operating expenseGAAP | $3.4 million | decrease of $0.8 million | decrease of less than $0.1 million |
| Sales and marketing expenseGAAP | 1,365 | – | – |
| Research and development expenseGAAP | 1,145 | – | – |
| General and administrative expenseGAAP | 948 | – | – |
| Operating lossGAAP | (2,493) | – | – |
| Interest expenseGAAP | (110) | – | – |
| Other income, netGAAP | 7 | – | – |
| Net lossGAAP | (2,596) | – | – |
| Net loss attributable to Intrusion, Inc.GAAP | $ (2,590) | – | – |
| Basic net loss per shareGAAP | $ (0.13) | – | – |
| Diluted net loss per shareGAAP | $ (0.13) | – | – |
| Weighted average common shares outstanding, basicGAAP | 20,395 | – | – |
| Weighted average common shares outstanding, dilutedGAAP | 20,395 | – | – |
| Six months ended June 30 revenueGAAP | $ 2,341 | – | – |
| Six months ended June 30 cost of revenueGAAP | 717 | – | – |
| Six months ended June 30 gross profitGAAP | 1,624 | – | – |
| Six months ended June 30 sales and marketing expenseGAAP | 2,995 | – | – |
| Six months ended June 30 research and development expenseGAAP | 2,596 | – | – |
| Six months ended June 30 general and administrative expenseGAAP | 2,098 | – | – |
| Six months ended June 30 operating lossGAAP | (6,065) | – | – |
| Six months ended June 30 interest expenseGAAP | (121) | – | – |
| Six months ended June 30 other income, netGAAP | 27 | – | – |
| Six months ended June 30 net lossGAAP | (6,159) | – | – |
| Six months ended June 30 net loss attributable to Intrusion, Inc.GAAP | $ (6,153) | – | – |
| Six months ended June 30 basic net loss per shareGAAP | $ (0.30) | – | – |
| Six months ended June 30 diluted net loss per shareGAAP | $ (0.30) | – | – |
What drove it
- The Company reported sequential revenue growth of 64%.
- Performance continued to be impacted by delays in the award of a key U.S. government contract.
- The Company signed a $4 million annual contract to deliver cyber threat intelligence and critical infrastructure protection to the state of Texas.
- The VigilAigent acquisition added approximately $3.5 million in annual recurring revenue from multi-year contracts over the upcoming quarters.
- The Company identified more than $3 million of potential annualized operating cost synergies from the VigilAigent acquisition.
- Gross margin varies based on product mix.
Concerns
- Revenue decreased 22% compared to the prior-year period.
- Gross profit margin was 66%, compared to 74% for the first quarter of 2026 and 76% for the prior-year period.
- Net loss was $ (2,596) (in thousands), compared to $ (2,042) (in thousands) in the second quarter of 2025.
- Interest expense was (110) (in thousands), compared to (21) (in thousands) in the second quarter of 2025.
- Cash and cash equivalents were $ 182 (in thousands) as of June 30, 2026.
- The timing and funding approvals for the key U.S. government contract remain unresolved.
What to watch
- Final award timing and funding approvals for the key U.S. government contract and the extent to which associated revenue is realized in future periods.
- Realization of approximately $3.5 million in annual recurring revenue from VigilAigent multi-year contracts over the upcoming quarters.
- Execution against more than $3 million of identified potential annualized operating cost synergies.
- The Company's stated expectation for steady improvement in financial results during the second half of fiscal 2026.
- Progress toward the Company's stated objective to transition to profitability in fiscal year 2027.
Balance sheet and cash flow
- Cash and cash equivalents were $ 182 (in thousands) as of June 30, 2026, compared with $ 3,624 (in thousands) as of December 31, 2025.
- Accounts receivable, net of allowance of $0.1 million, were 1,452 (in thousands) as of June 30, 2026, compared with 131 (in thousands) as of December 31, 2025.
- Total assets were $ 12,471 (in thousands) as of June 30, 2026, compared with $ 10,387 (in thousands) as of December 31, 2025.
- Notes payable, current portion, were 2,236 (in thousands) as of June 30, 2026.
- Notes payable, noncurrent portion, were 1,034 (in thousands) as of June 30, 2026.
- Total current liabilities were 6,007 (in thousands) as of June 30, 2026, compared with 1,785 (in thousands) as of December 31, 2025.
- Total noncurrent liabilities were 2,379 (in thousands) as of June 30, 2026, compared with 1,325 (in thousands) as of December 31, 2025.
- Total stockholders' equity was 4,085 (in thousands) as of June 30, 2026, compared with 7,277 (in thousands) as of December 31, 2025.
Analysis
Intrusion reported second-quarter revenue of $ 1,453 (in thousands), a 64% sequential increase but a 22% decrease from the prior-year period. Management said performance continued to be affected by delays in the award of a key U.S. government contract. The company expects that a meaningful portion of the associated revenue will be realized in future periods, subject to final award timing and funding approvals.
Profitability weakened despite lower operating expense. Gross profit margin was 66%, versus 74% in the first quarter of 2026 and 76% in the prior-year period, with management citing product mix. Operating expense was $3.4 million, down $0.8 million sequentially and down less than $0.1 million from the second quarter of 2025, but operating loss was (2,493) (in thousands) and net loss was (2,596) (in thousands), compared with net loss of (2,042) (in thousands) a year earlier.
The VigilAigent acquisition is central to management's revenue-quality and cost narrative. The company said the acquisition adds approximately $3.5 million of annual recurring revenue from multi-year contracts over the upcoming quarters and identified more than $3 million of potential annualized operating cost synergies. It also cited customer renewals, new business, and partner engagement since closing. Separately, Intrusion signed a $4 million annual Texas contract for cyber threat intelligence and critical infrastructure protection.
Liquidity and liabilities warrant attention. Cash and cash equivalents were $ 182 (in thousands) at June 30, 2026, compared with $ 3,624 (in thousands) at December 31, 2025. Notes payable were reported as 2,236 (in thousands) current and 1,034 (in thousands) noncurrent, while interest expense increased to (110) (in thousands) from (21) (in thousands) in the prior-year quarter.
The company did not provide formal numerical revenue, margin, expense, or tax-rate guidance. Management expects steady improvement in financial results in the second half of fiscal 2026 and stated that it remains on track to transition Intrusion to profitability in fiscal year 2027. The key operating markers are government-contract timing, recognition of VigilAigent recurring revenue, acquisition integration, cost-synergy realization, and gross-margin performance as product mix changes.
Management, verbatim
The second quarter was a pivotal one for Intrusion. We returned to sequential revenue growth and restored the revenue run rate achieved prior to the funding delay associated with the Department of War contract. We also made significant progress in positioning our business for future growth, as demonstrated by our recent acquisition of VigilAigent.
Tony Scott, President & Chief Executive Officer of Intrusion
The addition of VigilAigent will be immediately accretive to our top line results by adding approximately $3.5 million of annual recurring revenue over the upcoming quarters from a diversified base of multi-year customer contracts.
Tony Scott, President & Chief Executive Officer of Intrusion
As we look toward the second half of fiscal 2026, we are confident that we will begin to see a steady improvement in our financial results.
Tony Scott, President & Chief Executive Officer of Intrusion
Not in the filing
stated, not guessed- Formal quantitative forward guidance for revenue, gross margin, operating expenses, tax rate, earnings, or cash flow.
- Prior-quarter revenue amount, other than the reported 64% sequential increase.
- Prior-quarter operating expense amount.
- Segment revenue disclosure.
- Non-GAAP financial metrics or non-GAAP reconciliations.
- Operating cash flow, capital expenditures, and free cash flow.
- Share repurchases, dividends, or other capital-return disclosures.
- A prior-quarter earnings outlook for comparison.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.