Quarterly report [Sections 13 or 15(d)]

Segment Reporting

v3.26.1
Segment Reporting
 9 Months Ended
Jun. 28, 2026
Segment Reporting [Abstract]  
Segment Reporting

Note 3 - Segment Reporting

 

The Company’s two reportable segments, Applied Optics Center (“Applied Optics Center” or “AOC”) and Optex Systems – Richardson (“Optex Richardson”), are strategic businesses offering similar products to similar markets and customers; however, they are operated and managed separately due to differences in manufacturing technology, equipment, geographic location, and specific product mix. Applied Optics Center was acquired as a unit, and management at the time of the acquisition was retained.

 

 

The Applied Optics Center segment also serves as the key supplier of laser coated filters used in the production of periscope assemblies for the Optex Richardson segment. Intersegment sales and transfers are accounted for at annually agreed to pricing rates based on estimated segment product cost, which includes segment direct manufacturing and general and administrative costs but excludes profits that would apply to third party external customers.

 

The Chief Operating Decision Maker (“CODM”), which is our Chief Executive Officer (“CEO”), uses segment revenue, cost of sales and net operating income to assess the Company’s performance and allocation of resources. For the periods ended June 28, 2026 and June 29, 2025, the Company’s CODMs were Chad George and Danny Schoening, respectively. Danny Schoening resigned his position as CEO effective as of December 20, 2025, at which time Chad George assumed the position of CEO and CODM.

 

A summary of segment performance for the three months and nine months ended June 28, 2026 and June 29, 2025 is included in the tables below:

 

                                                 
   

Results of Operations Selective Financial Information

(Thousands)

  
    Three months ended  
    June 28, 2026     June 29, 2025  
    Optex Richardson     Applied Optics Center Dallas     Other (non-allocated costs and eliminations)     Consolidated     Optex Richardson    

Applied Optics Center

Dallas

     Other (non-allocated costs and eliminations)     Consolidated  
                                                 
Revenue from External Customers   $ 4,677     $ 5,052     $ -     $ 9,729     $ 6,838     $ 4,272     $ -     $ 11,110  
Intersegment Revenue     -       419       (419 )     -       -       325       (325 )     -  
Total Segment Revenue     4,677       5,471       (419 )     9,729       6,838       4,597       (325 )     11,110  
                                                                 
Total Cost of Sales     3,170       3,653       (419 )     6,404       5,081       3,186       (325 )     7,942  
                                                                 
Gross Profit     1,507       1,818       -       3,325       1,757       1,411       -       3,168  
Gross Margin %     32.2 %     33.2 %     -       34.2 %     25.7 %     30.7 %     -       28.5 %
                                                                 
General and Administrative Expense     1,168       500       266       1,934       982       192       83       1,257  
Segment Allocated G&A Expense     (424 )     424       -       -       (328 )     328       -       -  
Net General & Administrative Expense     744       924       266       1,934       654       520       83       1,257  
                                                                 
Operating Income (Loss)     763       894       (266 )     1,391       1,103       891       (83 )     1,911  
Operating Income (Loss) %     16.3 %     16.3 %     -       14.3 %     16.1 %     19.4 %     -       17.2 %
                                                                 
Interest Income (Expense)     -       -       28       28       -       -       -       -  
                                                                 
Income (Loss) before taxes   $ 763       894       (238 )     1,419       1,103       891       (83 )     1,911  
Income (Loss) before taxes %     16.3 %     16.3 %     -       14.6 %     16.1 %     19.4 %     -       17.2 %

 

 

                                                 
   

Results of Operations Selective Financial Information

(Thousands)

  
    Nine months ended  
    June 28, 2026     June 29, 2025  
   

Optex

Richardson

    

Applied Optics Center

Dallas

   

Other

(non-allocated costs and eliminations)

     Consolidated    

Optex

Richardson

    

Applied Optics Center

Dallas

    

Other

(non-allocated costs and eliminations)

     Consolidated  
                                                 
Revenue from External Customers   $ 16,248     $ 12,253     $ -     $ 28,501     $ 16,572     $ 13,466     $ -     $ 30,038  
Intersegment Revenue     -       1,005       (1,005 )     -       -       917       (917 )     -  
Total Segment Revenue     16,248       13,258       (1,005 )     28,501       16,572       14,383       (917 )     30,038  
                                                                 
Total Cost of Sales     11,453       9,239       (1,005 )     19,687       12,836       9,461       (917 )     21,380  
                                                                 
Gross Profit     4,795       4,019       -       8,814       3,736       4,922       -       8,658  
Gross Margin %     29.5 %     30.3 %     -       30.9 %     22.5 %     34.2 %     -       28.8 %
                                                                 
General and Administrative Expense     3,638       1,234       738       5,610       2,789       557       247       3,593  
Segment Allocated G&A Expense     (1,263 )     1,263       -       -       (983 )     983       -       -  
Net General & Administrative Expense     2,375       2,497       738       5,610       1,806       1,540       247       3,593  
                                                                 
Operating Income (Loss)     2,420       1,522       (738 )     3,204       1,930       3,382       (247 )     5,065  
Operating Income (Loss) %     14.9 %     11.5 %     -       11.2 %     11.6 %     23.5 %     -       16.9 %
                                                                 
Interest Income (Expense)     -       -       112       112       -       -       (12 )     (12 )
                                                                 
Income (Loss) before taxes   $ 2,420       1,522       (626 )     3,316       1,930       3,382       (259 )     5,053  
Income (Loss) before taxes %     14.9 %     11.5 %     -       11.6 %     11.6 %     23.5 %     -       16.8 %

 

Optex Richardson (OPX) – Richardson, Texas

 

Optex Richardson revenue is primarily in support of prime and subcontracted military customers. Approximately 91% of the Optex Richardson segment revenue is comprised of domestic military customers, and 9% is comprised of foreign military customers. For the nine months ended June 28, 2026, Optex Richardson represented 57% of the Company’s total consolidated revenue and consisted of revenue from the U.S. government (19%), and two major U.S. defense contractors (19% and 13%).

 

Optex Richardson is located in Richardson Texas, with leased premises consisting of approximately 49,100 square feet. As of June 28, 2026, the Richardson facility operated with 95 full-time equivalent employees in a single shift operation. The facilities at Optex Richardson serve as the home office for both the Optex Richardson and Applied Optics Center segments.

 

Applied Optics Center – Dallas, Texas

 

The Applied Optics Center serves primarily domestic U.S. customers. Sales to commercial customers represent 10% and military sales to prime and subcontracted customers represent 90% of the total external segment revenue for the nine months ended June 28, 2026. Approximately 92% of the AOC revenue was derived from external customers and approximately 8% was related to intersegment sales to Optex Richardson in support of military contracts. For the nine months ended June 28, 2026, AOC represented 43% of the Company’s total consolidated revenue and consisted of revenue from three major defense contractors representing 11%, 9% and 8% of the Company’s consolidated revenue, respectively.

 

The Applied Optics Center is located in Dallas, Texas with leased premises consisting of approximately 44,867 square feet of space. As of June 28, 2026, AOC operated with 45 full-time equivalent employees in a single shift operation.

 

 

The financial tables below present information on the reportable segments’ profit or loss for each period, as well as segment assets as of each period end. The Company does not allocate interest expense, income taxes or unusual items to segments. A summary of segment performance for the three and nine months ended June 28, 2026 and June 29, 2025 is included in the tables below:

 

   

Reportable Segment Financial Information

(thousands)

  
    As of and for the three months ended June 28, 2026  
   

Optex

Richardson

    

Applied Optics

Center

Dallas

    

Other

(non-allocated

costs and

intersegment

eliminations)

    

Consolidated

Total

  
                         
Revenue from external customers   $ 4,677     $ 5,052     $ -     $ 9,729  
Intersegment revenue     -       419       (419 )     -  
Total revenue   $ 4,677     $ 5,471     $ (419 )   $ 9,729  
                                 
Interest income   $ -     $ -     $ 28   $ 28
                                 
Depreciation and amortization   $ 39     $ 68     $ -     $ 107  
                                 
Income before taxes   $ 763     $ 894     $ (238 )   $ 1,419  
                                 
Other significant noncash items:                                
Allocated home office expense   $ (424 )   $ 424     $ -     $ -  
Stock compensation expense   $ -     $ -     $ 266     $ 266  
Warranty expense   $ -     $ -     $ -     $ -  
                                 
Segment assets   $ 23,198     $ 9,283     $ -     $ 32,481  
Expenditures for segment assets   $ 33     $ 174     $ -     $ 207  

 

   

Reportable Segment Financial Information

(thousands)

  
    As of and for the three months ended June 29, 2025  
   

Optex

Richardson

    

Applied Optics

Center

Dallas

    

Other

(non-allocated

costs and

intersegment

eliminations)

    

Consolidated

Total

  
                         
Revenue from external customers   $ 6,838     $ 4,272     $ -     $ 11,110  
Intersegment revenue     -       325       (325 )     -  
Total revenue   $ 6,838     $ 4,597     $ (325 )   $ 11,110  
                                 
Interest income   $ -     $ -     $ -     $ -  
                                 
Depreciation and amortization   $ 72     $ 59     $ -     $ 131  
                                 
Income before taxes   $ 1,103     $ 891     $ (83 )   $ 1,911  
                                 
Other significant noncash items:                                
Allocated home office expense   $ (328 )   $ 328     $ -     $ -  
Stock compensation expense   $ -     $ -     $ 83     $ 83  
Warranty expense   $ -     $ 68     $ -     $ 68  
                                 
Segment assets   $ 20,626     $ 8,554     $ -     $ 29,180  
Expenditures for segment assets   $ 159     $ 147     $ -     $ 306  

 

 

   

Reportable Segment Financial Information

(thousands)

  
    As of and for the nine months ended June 28, 2026  
   

Optex

Richardson

    

Applied Optics

Center

Dallas

    

Other

(non-allocated

costs and

intersegment

eliminations)

    

Consolidated

Total

  
                         
Revenue from external customers   $ 16,248     $ 12,253     $ -     $ 28,501  
Intersegment revenue     -       1,005       (1,005 )     -  
Total revenue   $ 16,248     $ 13,258     $ (1,005 )   $ 28,501  
                                 
Interest income   $ -     $ -     $ 112   $ 112
                                 
Depreciation and amortization   $ 107     $ 187     $ -     $ 294  
                                 
Income before taxes   $ 2,420     $ 1,522     $ (626 )   $ 3,316  
                                 
Other significant noncash items:                                
Allocated home office expense   $ (1,263 )   $ 1,263     $ -     $ -  
Stock compensation expense   $ -     $ -     $ 738     $ 738  
Warranty expense   $ -     $ (137 )   $ -     $ (137 )
                                 
Segment assets   $ 23,198     $ 9,283     $ -     $ 32,481  
Expenditures for segment assets   $ 351     $ 705     $ -     $ 1,056  

 

   

Reportable Segment Financial Information

(thousands)

  
    As of and for the nine months ended June 29, 2025  
   

Optex

Richardson

    

Applied Optics

Center

Dallas

    

Other

(non-allocated

costs and

intersegment

eliminations)

    

Consolidated

Total

  
                         
Revenue from external customers   $ 16,572     $ 13,466     $ -     $ 30,038  
Intersegment revenue     -       917       (917 )     -  
Total revenue   $ 16,572     $ 14,383     $ (917 )   $ 30,038  
                                 
Interest expense   $ -     $ -     $ (12 )   $ (12 )
                                 
Depreciation and amortization   $ 203     $ 183     $ -     $ 386  
                                 
Income before taxes   $ 1,930     $ 3,382     $ (259 )   $ 5,053  
                                 
Other significant noncash items:                                
Allocated home office expense   $ (983 )   $ 983     $ -     $ -  
Stock compensation expense   $ -     $ -     $ 247     $ 247  
Warranty expense   $ -     $ 121     $ -     $ 121  
                                 
Segment assets   $ 20,626     $ 8,554     $ -     $ 29,180  
Expenditures for segment assets   $ 218     $ 245     $ -     $ 463