INTRUSION INC Navigates Q2 with Stable Capital Structure

TL;DR

INTZ is treading water, showing no significant financial shifts in Q2 2025, which is a red flag for growth investors.

AI Summary

INTRUSION INC reported a net loss for the six months ended June 30, 2025, with revenue figures not explicitly detailed in the provided excerpt. The company's financial position shows a retained earnings deficit, indicating accumulated losses over time. Key business changes or strategic outlooks are not discernible from the provided data. The filing indicates a consistent structure for Series A Preferred Stocks, Common Stock, Treasury Stock, Accumulated Other Comprehensive Income, Additional Paid-In Capital, and Retained Earnings across various reporting periods. The company's stock subscription receivable balance remained constant at $0 from December 31, 2024, through June 30, 2025. The primary financial activity reflected is the ongoing management of its capital structure, with no significant shifts in equity components during the first two quarters of 2025. The company's fiscal year ends on December 31.

Why It Matters

For investors, INTRUSION INC's consistent capital structure across Q1 and Q2 2025, despite an implied net loss, suggests a period of financial stability rather than growth. Employees might see this as a signal of steady operations, but without revenue growth, future expansion could be limited. Customers are unlikely to be directly impacted by these internal financial movements, but a lack of growth could hint at slower innovation compared to more dynamic competitors in the computer communications equipment sector. The broader market might view this as a company in a holding pattern, potentially lagging behind competitors like Palo Alto Networks or Fortinet who are actively expanding their cybersecurity offerings.

Risk Assessment

Risk Level: medium — The risk level is medium because while the capital structure appears stable, the absence of explicit revenue or net income growth figures, coupled with an implied retained earnings deficit, suggests ongoing operational challenges. The company's consistent stock subscription receivable at $0 indicates no new equity financing from subscriptions during the period, which could limit growth initiatives.

Analyst Insight

Investors should hold off on new investments in INTRUSION INC until clearer signs of revenue growth and profitability emerge. Current investors should monitor upcoming filings for any strategic shifts or new product announcements that could drive future performance, as the current data suggests a lack of significant positive momentum.

Key Numbers

• $0 — Stock Subscription Receivable (remained constant from 2024-12-31 to 2025-06-30, indicating no new equity subscriptions)
• 2025-06-30 — Conformed Period of Report (end date of the reporting period for the 10-Q)
• 2025-08-12 — Filed As Of Date (date the 10-Q was filed with the SEC)
• 1231 — Fiscal Year End (INTRUSION INC's fiscal year ends on December 31)

Key Players & Entities

• INTRUSION INC (company) — filer of the 10-Q
• 06 Technology (company) — organization name associated with the filer
• Plano, TX (location) — business address of INTRUSION INC
• SEC (regulator) — recipient of the 10-Q filing
• Palo Alto Networks (company) — competitor in the cybersecurity sector
• Fortinet (company) — competitor in the cybersecurity sector

FAQ

Industry Context

INTRUSION INC operates within the computer communications equipment sector. This industry is characterized by rapid technological advancements, intense competition, and evolving cybersecurity threats. Companies in this space often focus on innovation to maintain market share and address emerging customer needs.

Regulatory Implications

As a publicly traded company, INTRUSION INC is subject to SEC regulations, including timely filing of financial reports like the 10-Q. Compliance with accounting standards (GAAP) and disclosure requirements is crucial to maintain investor confidence and avoid penalties.

What Investors Should Do

1. Investigate revenue drivers and profitability.
2. Analyze the reasons for the retained earnings deficit.
3. Seek clarity on strategic initiatives and business outlook.

Key Dates

• 2025-06-30: 10-Q Filing Period End — Marks the end of the reporting period for the quarterly financial statements.
• 2025-08-12: 10-Q Filing Date — Indicates when the company submitted its quarterly report to the SEC, providing updated financial information to investors.
• 2025-12-31: Fiscal Year End — Defines the end of the company's annual financial reporting cycle.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC) that provides a comprehensive update on a company's financial performance and position. (This document is the primary source of the financial information being analyzed.)

Retained Earnings

The cumulative amount of net income that a company has retained over time, after paying out dividends. (A deficit in retained earnings, as indicated for INTRUSION INC, signifies accumulated losses over the company's history.)

Stock Subscription Receivable

An amount owed to the company by a subscriber for shares of stock that have been subscribed to but not yet fully paid for. (A balance of $0 indicates no outstanding amounts due for stock subscriptions, suggesting no recent equity financing through this mechanism.)

Series A Preferred Stocks

A class of preferred stock that has priority over common stock in terms of dividends and asset distribution in case of liquidation. (The consistent structure of this equity component suggests it is a stable part of the company's capital structure.)

Accumulated Other Comprehensive Income

A component of shareholders' equity that includes unrealized gains and losses that are not reported in the income statement. (Its presence reflects potential fluctuations in value from items like foreign currency translation or certain investment gains/losses.)

Year-Over-Year Comparison

Specific comparative metrics against the prior year's filing are not detailed in the provided excerpt. However, the consistent structure of equity accounts and a static stock subscription receivable balance suggest a period of relative stability in capital management rather than significant operational or financial shifts compared to previous reporting periods.

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share INTZ Nasdaq Capital Market
• $0.5 million — sions after six months in amounts up to $0.5 million per calendar month at the noteholder's
• $0.5 m — in, the remaining balance on Note 1 was $0.5 million, Note 2 was paid in full, the int
• $9.5 million — n March 2024, as a result of exchanging $9.5 million principal in aggregate for equity, the
• $101 — principal balance due under the note by $101 thousand, which reflected the amount du
• $50.0 million — ht & Co., LLC to potentially sell up to $50.0 million of the Company's common stock using a s
• $1,100 — A preferred stock has a stated value of $1,100, accrues a rate of return on the stated

Filing Documents

• intrusion_i10q-063025.htm (10-Q) — 624KB
• intrusion_ex3101.htm (EX-31.1) — 11KB
• intrusion_ex3102.htm (EX-31.2) — 12KB
• intrusion_ex3201.htm (EX-32.1) — 6KB
• 0001683168-25-005985.txt ( ) — 3518KB
• intz-20250630.xsd (EX-101.SCH) — 35KB
• intz-20250630_cal.xml (EX-101.CAL) — 45KB
• intz-20250630_def.xml (EX-101.DEF) — 102KB
• intz-20250630_lab.xml (EX-101.LAB) — 288KB
• intz-20250630_pre.xml (EX-101.PRE) — 225KB
• intrusion_i10q-063025_htm.xml (XML) — 364KB

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements 3 Condensed Consolidated Balance Sheets as of June 30, 2025 (unaudited), and December 31, 2024 3 Unaudited Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025, and 2024 4 Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) for the three and six months ended June 30, 2025, and 2024 5 Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025, and 2024 6 Notes to Unaudited Condensed Consolidated Financial Statements 7

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 15

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 19

Controls and Procedures

Item 4. Controls and Procedures 19

– OTHER INFORMATION

PART II – OTHER INFORMATION 20

Legal Proceedings

Item 1. Legal Proceedings 20

Risk Factors

Item 1A. Risk Factors 20

Unregistered Sales of Equity Securities and Use of Proceeds and Issuer Purchases of Equity Securities

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds and Issuer Purchases of Equity Securities 20

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 20

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 20

Other Information

Item 5. Other Information 20

Exhibits

Item 6. Exhibits 21 Signature Page 22 2

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

FINANCIAL STATEMENTS

Item 1. FINANCIAL STATEMENTS INTRUSION INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value amounts) June 30, 2025 December 31, 2024 (unaudited) ASSETS Current Assets: Cash and cash equivalents $ 4,689 $ 4,851 Short-term investments 3,749 – Accounts receivable, net 103 169 Contract asset 1,214 8 Prepaid expenses and other assets 733 506 Total current assets 10,488 5,534 Noncurrent Assets: Property and equipment: Equipment 2,864 2,690 Capitalized software development 4,653 3,948 Leasehold improvements 18 18 Property and equipment, gross 7,535 6,656 Accumulated depreciation and amortization ( 3,543 ) ( 2,809 ) Property and equipment, net 3,992 3,847 Finance leases, right-of-use assets, net 279 491 Operating leases, right-of-use assets, net 1,310 1,356 Other assets 287 281 Total noncurrent assets 5,868 5,975 TOTAL ASSETS $ 16,356 $ 11,509 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable, trade $ 711 $ 1,508 Accrued expenses 265 291 Finance lease liabilities, current portion 207 405 Operating lease liabilities, current portion 89 209 Notes payable – 529 Deferred revenue 1,975 730 Total current liabilities 3,247 3,672 Noncurrent Liabilities: Finance lease liabilities, noncurrent portion 109 172 Operating lease liabilities, noncurrent portion 1,367 1,414 Total noncurrent liabilities 1,476 1,586 Commitments and Contingencies – (See Note 5) – – Stockholders' Equity: Preferred stock, $ 0.01 par value: Authorized shares – 5,000 ; Issued shares – 0 in 2025 and 4 in 2024 – 3,827 Common stock, $ 0.01 par value: Authorized shares – 80,000 ; Issued shares – 19,901 in 2025 and 15,591 in 2024; Outstanding shares – 19,900 in 2025 and 15,590 in 2024 199 156 Common stock held in treasury, at cost – 1 share ( 362 ) ( 362 ) Additional paid-in capital 133,986 122,552 St

View Full Filing

View this 10-Q filing on SEC EDGAR