WYY earnings analysis
What we found in WYY's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
WidePoint delivered modest year-over-year Q2 growth, stronger gross margins and a return to profitability, with revenue of $37.9996 million, diluted EPS of $0.01 and operating income of $10,383. The quarter was softer sequentially than Q1 revenue of approximately $40.6 million, and six-month operating cash flow remained negative at $1.033 million due primarily to receivables and unbilled receivables. The $3.1 billion CWMS 3.0 award is strategically significant but remains subject to a GAO protest, while management expects higher compliance costs and $0.4 million to $0.5 million of second-half capital expenditures.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue grew year over year
- Q2 revenue increased 2% year over year to $37,999,582 from $37,283,809, although it declined from approximately $40.6 million in Q1 2026. Carrier Services grew $1,841,800 to $24,064,860, driven by more DHS phone lines under management.
- Gross margin expanded
- Gross profit increased $729,614 year over year to $5,846,856, lifting gross margin to 15.4% from 13.7% based on reported results. Managed Services gross margin improved to 36% from 30%.
- Profitability improved
- The company returned to profitability, reporting operating income of $10,383 and net income of $66,420, versus an operating loss of $708,326 and net loss of $618,459 in Q2 2025. Diluted EPS improved to $0.01 from $(0.06).
- First-half growth accelerated
- Six-month revenue increased 11% to $78,575,612 from $70,793,848, while six-month net income improved to $143,380 from a net loss of $1,342,522. Managed Services revenue rose $2,557,224 to $28,726,712.
- Large DHS contract award
- WidePoint was selected as the single awardee of the DHS CWMS 3.0 contract, a 10-year IDIQ contract with an approximately $3.1 billion ceiling value. The contract covers lifecycle management, connectivity, security and operational requirements across DHS components.
- Liquidity and debt position stable
- Unrestricted cash increased to $10,018,392 from $9,818,503 at December 31, 2025, and the company had no outstanding balance on its $4,000,000 revolving credit facility at June 30, 2026.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- CWMS 3.0 award remains contested
- A post-award GAO protest was filed on June 29, 2026 against the CWMS 3.0 award. The contract has an approximately $3.1 billion ceiling value, and management stated that the outcome cannot be predicted with certainty.
- Working capital absorbed cash
- Operating cash flow was negative $1,032,924 for the six months ended June 30, 2026, compared with negative $55,448 in the prior-year period. Accounts receivable and unbilled receivables used $8,425,710 of cash, while unbilled receivables increased to $41,789,749 from $33,548,228 at year-end.
- Heavy federal customer concentration
- U.S. federal government customers represented 85% of Q2 revenue and 80% of trade receivables at June 30, 2026. Management noted that government payment delays, shutdowns and continuing budget resolutions can delay contract funding and collections.
- Compliance costs will increase
- Management expects approximately $0.8 million of incremental accelerated-filer compliance costs in the second half of 2026. General and administrative expenses were already $4,989,623 in Q2, or approximately 13% of revenue.
- Upcoming infrastructure spending
- The company expects second-half 2026 capital expenditures of $0.4 million to $0.5 million and anticipates that 2027 capital expenditures could exceed $1.0 million. Current-quarter operating cash flow was not separately disclosed, while six-month operating cash flow was negative $1,032,924.
- Contingent award-related compensation
- The company identified up to approximately $0.6 million of cash incentive compensation and up to approximately $0.4 million of stock-based compensation contingent on a favorable CWMS 3.0 protest resolution. No liability had been recognized for these payments as of June 30, 2026.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.01
- Gross margin
- 15.4%
- Operating margin
- 0.03%
- Segment
- Single reportable segment: $37,999,582 revenue for Q2 2026 versus $37,283,809 in Q2 2025; the company does not report separate operating segments.
- Segment
- Carrier Services: $24,064,860, up $1,841,800 year over year.
- Segment
- Managed Services: $13,934,722, down $1,126,027 year over year; managed service fees rose to $9,688,301, while reselling and other services declined to $3,014,682.
What they said about what is next.
No numeric revenue or EPS guidance was provided. Management expects second-half 2026 capital expenditures of approximately $0.4 million to $0.5 million, 2027 capital expenditures could exceed $1.0 million, and incremental accelerated-filer compliance costs of approximately $0.8 million in the second half of 2026.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 14, 2026
- WYY reported strong revenue growth for Q1 2026, with revenues increasing 21% year-over-year to $40.6 million. Despite a net income of $77,000, which marks a significant turnaround from a net loss of $724,100 in Q1 2025,…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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