Company: KVHI
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001007587-25-000012
Chunk: 75

Company: KVH INDUSTRIES INC \DE\
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 1
Chunk 75
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 cost of service sales, partially offset by a $0.4 million increase in content services cost of services sales. As a percentage of service sales, costs of service sales were 64% and 59% for the six months ended June 30, 2025 and 2024, respectively.

For the six months ended June 30, 2025, costs of product sales decreased by $2.6 million, or 27%, to $7.0 million from $9.6 million in the six months ended June 30, 2024, primarily due to a $1.9 million decrease in various manufacturing and other unabsorbed expenses, a $0.5 million decrease in TracVision cost of product sales and a $0.5 million decrease in Starlink cost of product sales, partially offset by a $0.3 million increase in OneWeb cost of product sales. As a percentage of product sales, costs of product sales were 96% and 117% for the six months ended June 30, 2025 and 2024, respectively. Cost of product sales decreased as a percentage of product sales primarily due to the decrease in various manufacturing and other unabsorbed expense.

29

Operating Expenses

Research and development expense for the six months ended June 30, 2025 decreased by $3.3 million, or 61%, to $2.1 million from $5.4 million for the six months ended June 30, 2024. The decrease in research and development expense resulted primarily from a $2.8 million decrease in salaries, benefits and taxes, after giving effect to $1.1 million in costs incurred during the six months ended June 30, 2024 related to the reduction in our workforce. As a percentage of net sales, research and development expense was 4% and 9% for the six months ended June 30, 2025 and 2024, respectively.

Sales, marketing and support expense for the six months ended June 30, 2025 decreased by $0.7 million, or 7%, to $10.0 million from $10.7 million for the six months ended June 30, 2024. The decrease in sales, marketing and support expense resulted primarily from a $0.7 million decrease in salaries, benefits and taxes, after giving effect to $0.4 million in costs incurred during the six months ended June 30, 2024 related to the reduction in