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