v3.26.1
SEGMENT INFORMATION
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
SEGMENT INFORMATION SEGMENT INFORMATION
We operate our business in two reportable and operating segments: Security Solutions and Secure Networks.
•Our Security Solutions segment is primarily focused on cybersecurity, cloud and identity solutions, and secure messaging through Xacta®, Telos Automated Message Handling System ("AMHS") and Telos ID offerings.
•Our Secure Networks segment provides secure networking architectures and solutions to our customers through secure mobility solutions, and network management and defense services.
We measure each segment's profitability based on gross profit. The Chief Executive Officer ("CEO"), whom we identified as the chief operating decision maker ("CODM"), evaluates the segment's performance based on metrics, such as segment revenue and gross profit, to align with our strategies and objectives, and provide a framework for the timely and rational allocation of resources between the segments.
We account for inter-segment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices, if any. There were no inter-segment sales and transfers during the three months ended March 31, 2026, and 2025. Interest income, interest expense, other income and expense items, and income taxes, as reported in the consolidated financial statements, are not part of the segment profitability measure and are primarily recorded at the corporate level.
Management does not utilize total assets by segment to evaluate segment performance or allocate resources. As a result, assets are not tracked by segment, and therefore, total assets by segment are not disclosed.
Table 14: Results of Operations by Business Segment
For the Three Months Ended
March 31, 2026March 31, 2025
Security SolutionsSecure NetworksTotalSecurity SolutionsSecure NetworksTotal
(in thousands)
Revenues$45,970 $1,772 $47,742 $25,818 $4,798 $30,616 
Cost of sales
Depreciation and amortization (1)
2,593 3 2,596 1,501 2 1,503 
Stock-based compensation expense (1)
194 22 216 169 21 190 
Other segment items (2)
26,320 1,235 27,555 13,088 3,653 16,741 
Total cost of sales29,107 1,260 30,367 14,758 3,676 18,434 
Gross profit$16,863 $512 17,375 $11,060 $1,122 12,182 
Operating expenses:
Research and development expenses1,357 1,571 
Selling, general and administrative expenses14,563 19,633 
Total operating expenses15,920 21,204 
Operating income (loss)1,455 (9,022)
Other income697 561 
Interest expense(111)(147)
Income (loss) before income taxes2,041 (8,608)
(Provision for) benefit from income taxes(18)4 
Net income (loss)$2,023 $(8,604)
(1) The significant segment expense categories and amounts align with the segment-level information regularly provided by the CODM.
(2) Other segment items for each reportable segment include direct labor, direct subcontractor costs, direct materials and inventory, other direct non-labor costs, fringes, overhead, and facility costs.