Transcript
Good afternoon, and welcome to Wrap Technologies' Second Quarter 2025 Earnings Conference Call. I'm Louis Springer, Vice President of Finance. Joining me today are Scot Cohen, Chief Executive Officer; Jared Novick, President and Chief Operating Officer; and Jerry Ratigan, Chief Financial Officer. We appreciate your time and continued interest in Wrap. Before we begin, please note that certain statements made on today's call are forward-looking statements within the meaning of the federal securities laws. These statements are based on current expectations, assumptions and projections and involve risks and uncertainties that may cause actual results to differ materially. Important factors are discussed in our filings with the U.S. Securities and Exchange Commission, which are available at sec.gov. The forward-looking statements included in this conference call are only made as of the date of this call, and we disclaim any obligation to update forward-looking statements, except as required by law. Nothing on this call constitutes an offer to sell or the solicitation of an offer to buy any security. Any offering, if made, will be pursuant to an effective registration statement and prospectus. Unless otherwise indicated, our commentary compares the quarter ended June 30, 2025, with the prior year period. As a reminder, we may reference non-GAAP measures to provide additional insight into our operating performance. Reconciliations to the most directly comparable GAAP measures are or will be provided in our supplemental materials. With that, I'll turn the call over to our CEO, Scot Cohen.
Good afternoon, and thank you for joining us. I'm excited to get right to the point. Momentum is building for Wrap Technologies across the industry throughout our operations and most notably with a sharp increase in purchase orders. In fact, I can share that in the first 6 weeks of Q3, we received more purchase orders for Wrap devices than we did in the entire 6 months of the year. The end of Q2 marks an important milestone. The formal conclusion of our restructuring efforts. We believe the benefits of our prior year cost control measures are now fully realized. Q2 also marked the completion of our go-to-market pivot, where we abandoned an unscalable costly model that was not working in direct response to customer needs and built a renewed strategy and solution offering. Customers have validated the new approach with numerous agencies now using BolaWrap more than any other tool on their belt. And we're seeing a broader market validation and regulatory changes throughout the increasing restricted policies around higher use of force. I am happy to say that we're seeing positive results. Already in Q3, we've received new purchase orders for our new go-to-market strategy. We believe this increase in sales activity confirms initial success that we expect to continue. Later in this call, Jerry Ratigan, our CFO, will shed more light on our financials. For those of you that have been on this journey with us, thank you. Your steadfast support and belief in our company's potential have helped us turn the corner, and the results we present today are a direct reflection of that transformation. To illustrate the progress we've made, today's discussion will be organized into 3 broad categories: the first, market and performance and product performance. And why we believe this is a good place for an investor and a customer. We're supporting details, including market observations, BolaWrap deployment usage, recent conducive regulatory landscape and resulting positioning. Go-to-market strategy and team readiness and how we respond to customers' needs and align and improve branding and messaging while strengthening our executive team to take our solution to market. And on financial and strategic initiatives, how our financial performance showcased cost reductions, cash flow improvements and key internal initiatives that we believe are now paying strategic dividends. You'll hear directly from our President, Jared Novick; and our CFO, Jerry Ratigan, as we walk through our performance strategy and what's shaping up to be an active second half of the year. Together, they will cover improvements in cost controls and operational margin expansion, revenue growth from our recently launched bundled subscriptions and expansion of the BolaWrap through repurposed integrations that open large addressable markets. They will also discuss emerging relationships with renowned experts in policing and respective thought leaders, both individually and through formal agreements currently in progress, further positioning the company to explore adjacent markets such as global private security, healthcare, transit and Department of Defense applications. We have persevered and now we have the clarity. So let's begin.
Thank you, Scot. Our first section today is about market and product performance. BolaWrap deployments are increasing across diverse law enforcement agencies, ranging from small departments to large influential agencies in key geographies as well as specialized units such as school resource officers and crisis intervention teams. The net effect is a growing record of documented trust, effective integration and consistent field success. Agencies across Colorado, North Carolina and Canada, as examples, have reported strong usage of BolaWrap relative to their own inventory while several of the largest law enforcement agencies in Florida are actively evaluating it as a strategic replacement for traditional electronic control devices like TASERs. Another major agency in Florida, their crisis intervention team reports more frequent BolaWrap use than TASERs, reinforcing the device's growing reputation as a safer and more appropriate tool during mental health or disturbed person calls. Now notably, to date, there have been no reported serious injuries and 0 lawsuits related to BolaWrap deployments. That's a record uncommon in most traditional use of force tools. Historically, use of force data has been difficult to gather, with many federal data sets being complete or unreliable. Agencies are often reluctant to share their data unless there's a deep level of trust or an established agency-to-agency relationship. However, through our own conversations with long-standing customers, we believe that many departments are quietly moving away from higher levels of force such as TASERs due to declining usage, high costs and safety concerns. The increasingly restrictive policies are promoting agencies to rethink their approach with a new focus on minimizing risk while maintaining control. Without better tools, officers often find themselves relying on hands-on methods, which increases the risk of injury for everyone involved. These discussions reinforce what we have long believed: there is still no other effective tool to bridge the tactical gap between verbal commands and physical control. Officer injuries and lawsuits are continuing to rise, which underscores an urgent and largely unacknowledged need in modern policing. We believe our analysis reveals a clear pattern. In agencies without comprehensive Wrap programs, electronic weapon usage is declining while low-level hands-on control tactics are increasing. That's a dangerous scenario. This is leading to more officer injuries and exposing serious gaps in their current toolkits. In contrast, when agencies have a full Wrap program and they have adopted it, they're experiencing a significant rise in BolaWrap deployments based on their operational needs and it's now outperforming electronic weapons and higher-level use of force incidents, delivering lower liability, higher success rates and greater safety. It's a good news story. Now I want to talk about the favorable federal regulatory changes. We know that favorable policies and legal precedents can drive adoption; they can help deployments, and they certainly help sales. In Q2, we began to see the positive impact of some of these policy shifts, both domestically and internationally. Notably, in the United States, the unanimous Supreme Court decision on Barnes v. Felix was issued during Q2. This marks a noteworthy development in this regulatory landscape and establishes favorable conditions for Wrap. This case established a nationwide requirement that affirms what we've known all along: officers deserve the best tools, the best tactics and the best training to deliver safer outcomes for themselves and the communities they serve. The totality of circumstances test, now a federal law, uniquely positions the BolaWrap to meet the needs of today's officers while addressing the evolving legal landscape of liability. In Q2, public attention and use of force tools intensified, with shows dedicating a full segment to the dangerous risks and fatalities associated with TASERs. When combined with the unanimous Barnes v. Felix Supreme Court decision and a recent unintended death in Central California, these events have amplified awareness and urgency around safer alternatives. As a result, we're seeing measurable upticks in inquiries in our strategic discussions with customers and opening up new conversations about BolaWrap and its central place on the duty belt. Now we're moving to our go-to-market strategy and team readiness and response. Within the last quarter, we completely redefined our message and repositioned our brand in the marketplace. This wasn't intended just to be a marketing refresh; this is an intentional and strategic shift that has now recognized the evolved needs of public safety. We identified a strategic need to adapt to the federal regulatory changes that are imminent, the increasingly restrictive policies around higher means of force, and the rise of mental and behavioral health emergencies and launched what we call the era of pre-escalation. We're not just responding to the moment; we named it. In doing so, we've branded and established that Wrap is a leader in pre-escalation. We believe that we define a new operational timeline for officers, creating space before force is necessary—a moment when tools and better training and better outcomes can occur. This is where Wrap chose to operate, called the pre-escalation period. To support this new era, we introduced key terms that became foundational across our brand, training, and communications, terms like pre-escalation in the pre-escalation period. We also developed a new doctrine: the Wrap window of opportunity, a critical moment between verbal engagement and hands-on force, where officers can act with control, clarity, and compassion. But redefining a message means nothing unless our product, pricing, and systems are fully aligned. That's why we relaunched the BolaWrap 150, optimized our pricing models, and introduced a family of integrated systems designed for departments to train, deploy and support pre-escalation operations at scale. In short, this wasn't just a relaunch; it was intended to be a redefinition of who we are and how we serve. Wrap has evolved beyond being just a product company. We believe we have become the architects of the pre-escalation era.
Thanks, Jared. As we assess the collective market, it appears that agencies want more than a single vendor for their solutions. They want an alternative provider offering tools that meet today's policing requirements, supported by a complementary integrated and connected ecosystem of technology solutions on the market. We are responding directly to the customers' demand and market needs, and we believe the success of the market leader in this space further validates that our path is the right one. As part of our go-to-market strategy, we completely rebooted our social media campaigns and our marketing activities. We executed a full-scale relaunch and rebrand to Wrap Tech, Inc. across all social platforms and aligned our company branded messaging with the new pre-escalation narrative. Our content strategy was targeted and segmented with a focus on high-impact, viral-ready content tailored to resonate with distinct audience groups from law enforcement professionals to public safety advocates. The results were immediate. We generated over 3 million views in just 30 days, driving significant boosts in engagement and followership. All of this was accomplished with 0 ad spend—100% organic campaigning that delivered authentic measurable results without reliance on paid promotion. We've also updated our customer status collateral. We've completed a full refresh of sales and marketing materials to align with our new brand identity and our messaging for this pre-escalation era. This included updated visual design, tone, and product positioning across all customer-facing documents. We also rebuilt the website and expanded product-specific pages, incorporating detailed information about BolaWrap 150 and real-world success stories that highlight its impact. In addition, we grew our online library of content, including body-worn camera footage, media coverage, and customer success stories to support sales conversations and demonstrate the value of our solutions in the field. Key to our go-to-market strategy is our team readiness and partnerships. A key Q2 initiative centered on outreach to strategic partners and advancement in agreements, set to be formalized and announced in Q3, aimed at either broadening our sales outreach or deepening our value proposition within industry leaders in training and tactics. We believe training is absolutely central to our go-to-market strategy, encompassing both sales and post-sales efforts that prioritize customer success. We believe police officers want to hear directly from officers about what works in the field. That peer-to-peer credibility builds trust that cannot be replicated or compromised. These partnerships are developed alongside 2 paths: deeper within law enforcement, focused on the human factors, defensive tactics, arrest and control, and other core policing competencies; broader into other verticals, expanding into adjacent sectors such as health care, transportation, security, data sovereignty, and other emerging areas of focus for the second half of '25. In Q2, we strengthened our leadership with the appointment of Jerry Ratigan as CFO, a seasoned finance executive with over 20 years' experience across public companies, capital markets, investment banking, and enterprise scaling experience. We are fortunate to have Jerry's expertise guiding a critical function, helping to instill a financial discipline and operational rigor that define mature, high-performing companies. We further strengthened our operational talent with personnel leading our revenue, sales and marketing, and commercialization efforts. Formal announcements of these additions are expected in the third quarter. I'll now turn it over to Jerry, our new CFO, to share the financial report.
Thank you, Scot. The last section today focuses on our financials and strategic initiatives. During Q2, we continued to execute on our enterprise-wide cost rationalization program. As a result, we delivered meaningful reductions in our operating expenses. First, our robust cost reduction initiative is substantially complete. Operating expenses were reduced by 26% from Q1 to Q2 2025, declining to $3.3 million from $4.5 million. On a year-to-date basis, operating expenses are down 14% compared to the same period last year, from $7.9 million to $9.1 million. We believe these are the tangible results of our disciplined approach to resource management and efficiency. Second, we achieved cash flow improvements. Net cash used in operations declined by $2.2 million for the first 6 months of 2025, down to $5 million compared to $7.2 million in the same period of 2024. Cash and cash equivalents increased by 16% to $4.2 million at June 30, 2025, up from $3.6 million at December 31, 2024. We believe this is evidence of prudent financial stewardship and a testament to our commitment to operational excellence. Third, our strategic repositioning is well underway. Revenue came in at $1 million for the quarter and $1.8 million year-to-date as we continue to focus on customer acquisition, delivering an enhanced value proposition and executing our new go-to-market strategy. Finally, we took a proactive step during the quarter to strengthen our balance sheet. On June 30, 2025, we amended the terms of certain of the company's outstanding warrants, enabling us to reclassify the related warrant liabilities to additional paid-in capital on that date. This change eliminates the need to recognize mark-to-market changes in fair value through the statement of operations, thus reducing earnings volatility going forward. This takes us to our new subscriptions bundles and pricing models. Alongside our product, marketing, rebranding around messaging improvements, we also enhanced our pricing models. While our traditional product pricing remains available in the Wrap basic offering, we have introduced 2 new, more attractive subscription plans, WrapReady and WrapPlus. These plans not only include our trusted BolaWrap devices, but also address a common customer concern, the price point of replacement cassettes. Both subscription tiers feature an integrated cassette program that ensures customers can replenish as needed, reducing uncertainty around consumable costs and allowing agencies to meet operational needs with confidence. Wrap is gaining momentum from Q2 into Q3. As we conclude Q2 and look ahead into Q3, we believe the increase in volume and size of purchase orders highlights a growing shift from onetime product sales to multiyear Wrap subscription offerings. These subscriptions, including our newly launched WrapReady and WrapPlus bundles, are supported by integrated cassette programs and enhanced with a learning management system to effectively train officers on Wrap solutions. We anticipate these valuable enhanced offerings aligned with our new go-to-market strategy will meet growing customer demands.
Thank you, Jerry. As we wrap up our financials, I want to share some other select sales activities and initiatives. In Q2, Wrap applied for just under $1 million in DoJ funded grants to deliver pre-escalation tools, tactics and training across the U.S. Now these grant applications are currently under review but they are noteworthy in our pipeline. They also represent an important first step. We believe a renewed focus on federal programs and funding opportunities positions Wrap to potentially access larger grants and support pre-escalation initiatives at levels comparable to or possibly exceeding those historically allocated to de-escalation efforts. While there can be no assurances, we are encouraged by the alignment between our technology and current federal priorities. And as previously mentioned, policy shifts are creating new opportunities in the second half of 2025. Two major cities in the U.S. have initiated discussions to begin pilot program testing, while another major city is seeking to expand its initial program and increase deployments. Tomorrow morning, we are planning to launch training in Michigan with our first WrapReady department in the nation, a department that purchased through grant funding and now joins us in the era of pre-escalation. I'm also excited to announce that next week, WrapReady is expected to be introduced for the first time in the state of Florida at one of the premier law enforcement agencies in the U.S., the Lee County Sheriff's office. This new pilot program will train not only patrol deputies but will also test the deployment of our device with Lee County's corrections deputies, further reinforcing the operational scope of the BolaWrap. Strategic initiatives are playing a key role in the work Wrap is doing today. We believe our Q2 discipline and targeted R&D investments are now paying dividends. Most recently, we announced a counter UAS capability by repurposing our patented BolaWrap 150 devices, creating a novel differentiated solution for a large DoD addressable market with significant international opportunities following closely behind. Our BolaWrap cassettes and capabilities have now taken to the year with the R&D initiative of Wrap Merlin 1. This prototype launches Kevlar tethers to physically intercept hostile drones mid-air, offering a reusable alternative to traditional jamming or interceptor tools. The initiative targets the global counter UAS market projected to grow from $1.9 billion in 2023 to $6.8 billion in 2030. We intend to leverage our existing BolaWrap manufacturing infrastructure for rapid commercialization in both DoD and global defense markets. Another Q2 initiative that is now gaining traction involves rework of offerings and new partnerships within our Intrensic body-worn camera business line. We have seen increased demand for North American made cameras to address data sovereignty concerns, and we responded by introducing solutions built for security in North America featuring advanced encryption and industry competitive body-worn camera capabilities. Accordingly, Intrensic will now be known as WrapVision, a subscription service with 4G LTE capabilities focused on meeting today's new data standards and privacy requirements. This is all supported by a complementary digital software back end for managing digital evidence and other file management needs across public safety and allows us to approach adjacent markets such as healthcare and transportation.
Thanks, Jared. In closing, Q2 was a decisive turning point for Wrap. We have successfully completed our restructuring, aligned our product pricing and branding under a unified pre-escalation strategy, and delivered measurable operational and financial improvements. We reduced operational expenses by more than 1/4 from the prior quarter and secured meaningful purchase orders, many under multiyear subscription models that start to build recurring BolaWrap-related revenue. Our field data and customer feedback suggest that the BolaWrap is becoming the preferred low-force option for agencies that prioritize officer safety, community trust, and reducing liability. We believe those achievements are visible in the marketplace, validated by customers and supported by the evolving regulatory environment that favors our solutions. We are entering the back half of '25 with stronger fundamentals, with many purchase orders received, a differentiated product portfolio, and an expanding addressable market from law enforcement to defense, healthcare, and transportation. Our disciplined cost management, expanded strategic partnerships, and investment in R&D position us for growth. We believe our market is dynamic and driven by police change and customer demand for safer tools. It sets the stage for continued acceleration. To our investors, our partners, and our customers, thank you for your confidence in us. We are committed to delivering the value, capturing the new opportunities, and improving Wrap's next chapter in the upcoming months and years; it will be the strongest yet. With that, Louis, let's open it up for questions.
Thank you, Scot. We've had a few questions come in, and I'm going to read them one by one. The first question is, how do you plan to accelerate adoption among law enforcement agencies in the U.S. and internationally?
This is happening without us, and while I wish we could take credit, there are policies being adopted now that are driving adoption. We’ve talked about Barnes versus Felix, which is a significant one, but there are other policies in play as well. We’ve realized that we weren’t using officers' time efficiently and were often conveying the wrong messages. In a startup, it takes time to develop a new device for a tough industry. We needed to connect directly with departments, not just the chiefs but also the training staff and officers. Initially, it was challenging to establish those connections because we were working with distributors and salespeople as intermediaries. It was only when we engaged directly with chiefs, command staff, and trainers, discussing what success looks like and identifying both successes and failures, that we could gather valuable insights. We brought that data back to our team at Wrap to develop effective solutions. It required time, especially during our restructuring period, but once we clarified our message and the training connectivity needed—beyond just using trainers to establish consistency through a learning management system—that's when we started seeing significant scaling of programs. The device is now the most actively used item in the field today, which may surprise many. However, widespread awareness is lacking because it’s not being reported. To really understand its impact, you need to talk to those using our product. It's not universally implemented, but those who are successfully adopting it are showing that great leadership, practice, and commitment, often alongside city councils, are key. When everything connects well, especially with Wrap Plus, I believe we can take it even further. Jared, do you have anything to add?
Yes. I mean I'll just add that to really accelerate adoption, agencies are going to be pulling it into their departments. And we have a huge gap. It's being more and more restricted to higher uses of force. We've talked about that today. They're going hands-on. So the gap in need is there. So in part, yes, we need to accelerate and do our job of going to market, but it is being met with open arms because departments are acknowledging the problem. So we're finally getting validation, wide-scale validation that there's a need. It's clear. The regulatory landscape is good. It's our job now to take those tailwinds and accelerate our go-to-market.
I'm going to add just one little piece to that. We were actually getting thanked by some of our biggest and most active customers, even some of the small ones, thanking us for coming up with this type of support. Thank you for caring enough about this program. We hear that almost every time. There's no other vendor out there that's taken this kind of care. We hear that repeatedly, and actually, that's one of the drivers that makes me want to lean into this more. The fact that it's so unaddressed on the training side, the fact that we're just kind of getting connected with the customer in a different way—not trying to sell them something but actually trying to help for an outcome that we know is better. So our belief in the device and what we've seen through neighboring departments for departments and different programs has actually given us, I think, great strength to lean into this because we know what's right, and what you hear from our customers, thanking us for doing this, you know we're on the right path because they know it's going to help them.
The next question that came in is, how do you plan to penetrate non-law enforcement sectors, for example, corrections, private security, schools, and hospitals?
We're already making significant inroads, and a lot of it is coming directly to us, which is quite surprising. We mentioned during the call that we've activated our social media presence. The inquiries we're receiving are very encouraging, especially considering we've only just begun. We're aware of the challenges out there, and we're receiving feedback daily. We're present in several hospitals and correction facilities, and this progress is repeatable. It's simply a question of scaling up. Initially, we thought our distribution model would allow us to scale, but we realized that while we could sell through distribution, we weren't directly engaging with customers. Once we establish that direct connection, it becomes easier to understand the situation. The success we're currently experiencing is gaining traction. We're seeing this in neighboring counties and cities, as well as in states where robust programs are being developed that connect departments, corrections, schools, and hospitals within the same geographical area. It feels like momentum is building without us needing to push hard for it. Now that we have data, which everyone is eager to see, we can focus our efforts. I wish we had a more extensive data history, but unfortunately, the company did not prioritize this in the past. However, we now possess the data, and I believe this is the key to our progress. It's what drives us and has attracted many new talented executives who recognize its value. When we can present clear facts and data, it communicates its own message. We don’t have to explain it; the data guides our decisions. When a hospital, school, or correction facility demonstrates success, it highlights the importance of community and interconnectedness in public safety. Without our own insights and data, it's challenging to expect others to understand. But since we now have this information, it's starting to circulate. We have a solution that meets this demand, and I believe we will see rapid acceleration moving forward.
What I also want to say, we talked about regulatory change, Barnes v. Felix. There was another piece that happened in late March of this year in 2025. It's H.R. 2189, which introduced the bill to Congress about less lethal projectile devices; that's what our BolaWrap is. There is the potential for some declassification of the BolaWrap, which will allow us to go to the markets like private security and hospitals and other areas. We see that as a tremendous impact on our addressable market. So everything that we figured out and now we're doing right in law enforcement and public safety, those lessons learned—the video management system that we have—the learning management—all of that is now poised to be applied in other verticals. So as we've gotten our operations into control, we understand our messaging, we are bringing around pre-escalation. All of that applies in many orders of magnitude over in these larger markets. That's what I see. And those markets will now appreciate that we have traction and recognize the law enforcement, thereby giving us the credibility to enter those new markets.
Are there adjacent product lines or technology upgrades planned in the next 18 months?
Yes. I mean it's not only planned in the next 18 months, we're doing it now. We just did some press releases on a counter-drone or counter UAS system. And look, I have a background in the government and Department of Defense and some operations, particularly in airborne capabilities. When you say a counter-drone, that's historically known to maybe be a capital-intensive endeavor. Well, guess what? This is not capital intensive. It's simply repurposing the BolaWrap device or the BolaWrap cassettes as they are today, and we all know that we have that inventory. So when we say the investments that we're making in Q2, those were investments in time and focus that they capitalize on the inventory we had already but repurposed in a new way. And so when you see this counter UAS capability that's basically in twofold, yes, a UAV or UAS to UAS counter-drone capability where we'll be hosting cassettes on that drone, but also a surface-to-air capability where you take the traditional BolaWrap 150 handheld and give you a quick reaction capability to disable and take down any drones that are an immediate threat in a personal area. We know that's a documented urgent operational need downrange. And by doing so, it's very exciting for me, and I believe for our investors that this opens up the Department of Defense addressable market. As we look at adjacent product lines, it's a very smart way for us to take what we are doing now and move through partnerships and stay at that federal business line that we always have planned since the beginning of this year. Counter-drone and UAS is just one opportunity. The other thing that we've done is now rebranded Intrensic, which was a recurring business line for body-worn cameras, and rebranded it to WrapVision. That means providing better camera hardware, so at the edge, better components, better battery life, better resolution, 4G-enabled capabilities if people want to integrate live feeds to real-time crime centers—that's operational and on. And because we understand data sovereignty and cybersecurity has been a long-standing issue for many people across the industries, we now have partnered with cloud providers who keep that data within the respective countries, in our case, in America, and it gives them the confidence that we're handling the data correctly. That integrated WrapVision is scaled. It gives different tiers of support—Tiers 1, 2 and 3 through our partner network. It allows us to then offer greater bundling opportunities—for those who may just want a body cam solution at a very attractive price to then also add on the BolaWrap capabilities in what we call WrapReady or WrapPlus. The net effect of all these things is a smart repurposing of our inventory and better management through partnerships that increased capability for WrapVision. That combined effect gives us more than 18 months of activity to grow this company.
And I just want to— I want to mention one of the new products that I'm most proud of, and I've got quite a bit of experience in learning management, the learning management training. We noticed it was clear to us that we weren't connected with the customer. We had very little data. It was hard to get any— it was hard to get them on the phone. Let alone find out how the programs are going through. So it didn't take long for—once we realized that we had a connectivity issue to be able to come back to market with a way to get connected, a way to directly drop training into the officers right there to their phones and to be able to access them for the officer to be able to access these really important tutorials, training in burst-size increments. We're talking about 2 to 3 to 4 minutes of training versus having to go into a classroom and sit for 2 days and spend 20 hours. The accessibility of this training and showing it in a different way and talking about it in a different way, it doesn't sound like a big technological breakthrough. But I feel like technology has allowed us and in an economic way to be able to deliver these really important training lessons that are absolutely going to change behavior. What gets me excited is these programs are already lifting without this. So you can't tell me that when you get connected with an officer and we're dripping and training while being respectful of their time in content and talk track, that's a lot different than the past. We were on that talk track and on this trend because of all those lessons we've learned. The programs are thriving and delivering that directly to the officer. It's going to take usage to where it already is thriving to levels that I think are going to cause a lot more. It's going to force departments to have to look at this because this pre-escalation era that we're talking about—this before things escalate, this is critical training for public safety that just has not been available. We're going to own this space. We're going to be launching other products around this in the next—and we're doing it now, and we'll be leaning more into it. We're just getting started. This is going to build credibility with officers. This is what we're being thanked for, and I think this is the beginning of really I think it's actually as important, if not more important, than the device itself. If you don't know if the operator that's operating our device isn’t trained properly and we're not respectful of his or her tone, it’s just not going to have the same effect out there. I think we've mastered that and we get to prove that in the next couple of months.
The next question is, what's the status of the company's move to Virginia? And when do you expect production to ramp up as a result?
Thanks, Louis. I'll take that one. We are fully moved into Virginia. We are fully out of Arizona. We are fully out of Arizona. We have a production facility that we are scheduling with the state of Virginia to have an official launch physically. And in terms of our inventory and people, we are fully in Virginia. We're very proud to underscore to our customers, both domestically and internationally, that our products will be made in America, in Wise County. We appreciate everything that the state of Virginia has done for us and our move there. In terms of production, it can absolutely be scaled. As a reminder, we do have inventory, which is attractive for our business now, but we have the knowledge documented in videos, checklists, procedures, and the people on standby to start production and ensure QA/QC, quality-controlled devices on the product line now. We're ready to accelerate that in response to our pipeline, which we are— is now a focus and growing. Internally, we've made investments into planning infrastructure and process and in looking at our supply chain so that any lead times that are required are sufficiently notified and that we're prepared to meet demand with the right notice. So I'm confident about the team we've built around that. Bringing Jerry Ratigan in and his team are also documenting and scaling for the future. We see large demand in the future. So just to kind of put a fine point on it, we are fully in Virginia.
How do you see onetime sales versus subscription services as a portion of your revenues?
Yes. This is Jerry here. Happy to take this one on. Again, as highlighted on this call and through the Q&A, just to highlight again the optimization plan internally of alignment within the organization without the new product launches. We're also doing that from a revenue generation standpoint. So we're designing product and service offerings to deliver more value to our customers, a customer-first company. To deliver that value, we're refining our go-to-market plans and strategies, transitioning from the one-off a la carte sales efforts that historically had taken place within the company to more of a recurring subscription-based revenue model. That's again, as Jared and Scot had highlighted, talking to the customers, learning more about their needs and what we can deliver on a more regular basis to eliminate the uncertainty for the customers in their purchasing process. So at the forefront of this strategy, just focusing on the customer value proposition. Again, as evidenced by recent launches of our Wrap Ready and WrapPlus packages and bundles, we expect those to achieve these objectives. I don't know, Jared or Scot, if you had any other comments there?
Particularly with the LMS and the training model, which will be recurring subscription-based, there's another bucket of money that opens up to us. We've been selling the shiny object, the BolaWrap, which typically gets paid for out of capital goods, maybe even forfeiture dollars. But once you get into the training and the subscription services, there are much bigger buckets of grant money that I think we can tap. So I feel like this is new for the business. We're just exploring those buckets, and it's being really well received. I feel like our subscription business will be a lot more money. It's an operating line that's a lot bigger than a capital goods line. So we'll be— I think we're going to take full advantage of that coming up.
Yes. And I'll just pile on just a little bit more. Look, nothing has changed. You can still buy onetime stuff from us if you want to. If you still want to— we’re making it easier for customers to get the full support that they need across the different features we put into that bundle at a more attractive price. To Scott's point, that allows us to go after training dollars versus operational CapEx dollars. So this is all positive, everything to gain and nothing to lose.
Next question. Last earnings call, you spoke heavily about procuring accurate data surrounding BolaWrap deployments. What figures have you been able to come up with in comparison to other devices used by departments you're partnered with?
Scot, do you want to start that? Do you want me to start?
Yes, all right. Let me start. You would think when a company has got a product out there that the sharing of information would be very easy, and it would just be right in front of you. We should have had it. It turns out in this industry in public safety, it's not easy. It's very hard to collect this at a state level, at a federal level and on a small department level. It's just — it's been very difficult. But this is the crux of why we're doing what we're doing. This is why we're backing up the bed on the BolaWrap device without great support from the company. Let's call it out with inadequate support from the company, okay? But let's just say the training support, customer support, it wasn't there. We had no information. There are a bunch of reasons for it. It doesn't matter anymore. What does matter is the information we got is driving this because there's no way with the usage that we're seeing now in connected departments it's absolutely repeatable. So you asked the question, have we gotten more data, more data? Yes, we're getting more and more data. It's coming in. We're getting data through the trainers now. We're picking up the phones. We're doing visits. We're doing plenty of tours here. We're pounding it really hard to get this. But this is where the action is at, and this is where I think the conviction comes from us. You know it's being adopted with very little support from us with the right level of support that's scalable, which we can offer, and we're about to show the world that we can offer that. We're doing it right now. You're going to see these numbers start to go up, and we're going to develop a more trusted relationship with this sensitive information that will have a lot more data back. Everybody that we're talking to about WrapPlus, and we can't go out to the entire industry, we picked a dozen with full—again, they are thanking us for coming up with this. Part of the agreement is they're going to share data with us. We think that data is so valuable that we're willing to give it away for a fixed period of time to get that data because I think this data is going to drive the whole device adoption throughout the country, throughout the world. And supporting it the right way with—that will give us the right to bring out this—the LMS. From there, we start with BolaWrap training, yes. But in short order, we get to talk about pre-escalation and train in the pre-escalation space. We're talking about persuasion skills, communication skills, how to make decisions under stressful situations. This is an area that is absolutely needed. It's under-trained in this industry. It takes a long time to get access to it if you're lucky enough, and it's expensive. Guess what? We're going to make it available in burst-like increments and economically and effectively being respectful of their time as well. I think this is where you really start to get a lot more data because they're going to feel comfortable. We're partnering with these departments. I feel like this first dozen or so on the WrapPlus launch, these are our partners. They want it to be used on a day. They want to pre-escalate these situations. They don’t want to get into an escalated situation because they know what it costs. It costs offers' careers. It costs a lot of money, and it costs careers. It's just—it's not acceptable anymore. The regulation and the policies around this are just getting stricter and stricter. So the change is coming. We're right on the forefront.
Great. And before I read the next question, how are you doing on time? Do you need to edit and cut this before the fourth call?