v3.26.1
Segment Reporting
 6 Months Ended
Mar. 29, 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 exclude 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 March 29, 2026 and March 30, 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 six months ended March 29, 2026 and March 30, 2025 is included in the tables below:

 

                         
  

Results of Operations Selective Financial Information

(Thousands)

 
   Three months ended 
   March 29, 2026   March 30, 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  $6,245   $3,382   $ -   $9,627   $6,319   $4,411   $-   $10,730 
Intersegment Revenue   -    369    (369)   -    -    322    (322)   - 
Total Segment Revenue   6,245    3,751    (369)   9,627    6,319    4,733    (322)   10,730 
                                         
Total Cost of Sales   4,291    2,313    (369)    6,235    4,667    3,024    (322)   7,369 
                                         
Gross Profit   1,954    1,438    -    3,392    1,652    1,709    -    3,361 
Gross Margin %   31.3%   38.3%   -    35.2%   26.1%   36.1%   -    31.3%
                                         
General and Administrative Expense   1,114    354    260    1,728    869    183    72    1,124 
Segment Allocated G&A Expense   (424)   424    -    -    (328)   328    -    - 
Net General & Administrative Expense   690    778    260    1,728    541    511    72    1,124 
                                         
Operating Income (Loss)   1,264    660    (260)   1,664    1,111    1,198    (72)   2,237 
Operating Income (Loss) %   20.2%   17.6%   -    17.3%   17.6%   25.3%   -    20.8%
                                         
Interest Income (Expense)   -    -    35    35    -    -    1    1 
                                         
Income (Loss) before taxes  $1,264    660    (225)   1,699    1,111    1,198    (71)   2,238 
Income (Loss) before taxes %   20.2%   17.6%   -    17.6%   17.6%   25.3%   -    20.9%

 

 

                         
  

Results of Operations Selective Financial Information

(Thousands)

 
   Six months ended 
   March 29, 2026   March 30, 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  $11,570   $7,202   $            -   $18,772   $9,734   $9,194   $            -   $18,928 
Intersegment Revenue   -    586    (586)   -    -    593    (593)   - 
Total Segment Revenue   11,570    7,788    (586)   18,772    9,734    9,787    (593)   18,928 
                                         
Total Cost of Sales   8,282    5,588    (586)   13,284    7,755    6,277    (593)   13,439 
                                         
Gross Profit   3,288    2,200    -    5,488    1,979    3,510    -    5,489 
Gross Margin %   28.4%   28.2%   -    29.2%   20.3%   35.9%   -    29.0%
                                         
General and Administrative Expense   2,470    733    472    3,675    1,808    364    164    2,336 
Segment Allocated G&A Expense   (839)   839    -    -    (655)   655    -    - 
Net General & Administrative Expense   1,631    1,572    472    3,675    1,153    1,019    164    2,336 
                                         
Operating Income (Loss)   1,657    628    (472)   1,813    826    2,491    (164)   3,153 
Operating Income (Loss) %   14.3%   8.1%   -    9.7%   8.5%   25.5%   -    16.7%
                                         
Interest Income (Expense)   -    -    83    83    -    -    (12)   (12)
                                         
Income (Loss) before taxes  $1,657    628    (389)   1,896    826    2,491    (176)   3,141 
Income (Loss) before taxes %   14.3%   8.1%   -    10.1%   8.5%   25.5%   -    16.6%

 

Optex Richardson (OPX) – Richardson, Texas

 

Optex Richardson revenue is primarily in support of prime and subcontracted military customers. Approximately 94% of the Optex Richardson segment revenue is comprised of domestic military customers, and 6% is comprised of foreign military customers. For the six months ended March 29, 2026, Optex Richardson represented 62% of the Company’s total consolidated revenue and consisted of revenue from the U.S. Government (24%), and two major U.S. defense contractors (16% and 15%).

 

Optex Richardson is located in Richardson Texas, with leased premises consisting of approximately 49,100 square feet. As of March 29, 2026, the Richardson facility operated with 90 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 8% and military sales to prime and subcontracted customers represent 92% of the total external segment revenue for the six months ended March 29, 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 six months ended March 29, 2026, AOC represented 38% of the Company’s total consolidated revenue and consisted of revenue from three major defense contractors representing 11%, 7% and 6% 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 March 29, 2026, AOC operated with 44 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 six months ended March 29, 2026 and March 30, 2025 is included in the tables below:

 

  

Reportable Segment Financial Information

(thousands)

 
   As of and for the three months ended March 29, 2026 
  

Optex

Richardson

  

Applied Optics

Center

Dallas

  

Other

(non-allocated

costs and

intersegment

eliminations)

   Consolidated
Total		 
                 
Revenue from external customers  $6,245   $3,382   $             -   $9,627 
Intersegment revenue   -    369    (369)   - 
Total revenue  $6,245   $3,751   $(369)  $9,627 
                     
Interest income  $-   $-   $35   $35 
                     
Depreciation and amortization  $34   $63   $-   $97 
                     
Income before taxes  $1,264   $660   $(225)  $1,699 
                     
Other significant noncash items:                    
Allocated home office expense  $(424)  $424   $-   $- 
Stock compensation expense  $-   $-   $260   $260 
Warranty expense  $-   $(143)  $-   $(143)
                     
Segment assets  $22,484   $8,376   $-   $30,860 
Expenditures for segment assets  $294   $99   $-   $393 

 

 

  

Reportable Segment Financial Information

(thousands)

 
   As of and for the three months ended March 30, 2025 
  

Optex

Richardson

  

Applied Optics

Center

Dallas

  

Other

(non-allocated

costs and

intersegment

eliminations)

   Consolidated
Total		 
                 
Revenue from external customers  $6,319   $4,411   $                 -   $10,730 
Intersegment revenue   -    322    (322)   - 
Total revenue  $6,319   $4,733   $(322)  $10,730 
                     
Interest income  $-   $-   $1   $1 
                     
Depreciation and amortization  $67   $59   $-   $126 
                     
Income before taxes  $1,111   $1,198   $(71)  $2,238 
                     
Other significant noncash items:                    
Allocated home office expense  $(328)  $328   $-   $- 
Stock compensation expense  $-   $-   $72   $72 
Warranty expense  $-   $84   $-   $84 
                     
Segment assets  $19,313   $8,164   $-   $27,477 
Expenditures for segment assets  $134   $-   $-   $134 

 

  

Reportable Segment Financial Information

(thousands)

 
   As of and for the six months ended March 29, 2026 
  

Optex

Richardson

  

Applied Optics

Center

Dallas

  

Other

(non-allocated

costs and

intersegment

eliminations)

   Consolidated
Total		 
                 
Revenue from external customers  $11,570   $7,202   $               -   $18,772 
Intersegment revenue   -    586    (586)   - 
Total revenue  $11,570   $7,788   $(586)  $18,772 
                     
Interest income  $-   $-   $83   $83 
                     
Depreciation and amortization  $68   $119   $-   $187 
                     
Income before taxes  $1,657   $628   $(389)  $1,896 
                     
Other significant noncash items:                    
Allocated home office expense  $(839)  $839   $-   $- 
Stock compensation expense  $-   $-   $472   $472 
Warranty expense  $-   $(137)  $-   $(137)
                     
Segment assets  $22,484   $8,376   $-   $30,860 
Expenditures for segment assets  $318   $531   $-   $849 

 

 

  

Reportable Segment Financial Information

(thousands)

 
   As of and for the six months ended March 30, 2025 
  

Optex

Richardson

  

Applied Optics

Center

Dallas

  

Other

(non-allocated

costs and

intersegment

eliminations)

   Consolidated
Total		 
                 
Revenue from external customers  $9,734   $9,194   $               -   $18,928 
Intersegment revenue   -    593    (593)   - 
Total revenue  $9,734   $9,787   $(593)  $18,928 
                     
Interest expense  $-   $-   $(12)  $(12)
                     
Depreciation and amortization  $131   $124   $-   $255 
                     
Income before taxes  $826   $2,491   $(176)  $3,141 
                     
Other significant noncash items:                    
Allocated home office expense  $(655)  $655   $-   $- 
Stock compensation expense  $-   $-   $164   $164 
Warranty expense  $-   $54   $-   $54 
                     
Segment assets  $19,313   $8,164   $-   $27,477 
Expenditures for segment assets  $218   $245   $-   $463