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SEC Filings
ARGON ST, INC. filed this Form 10-Q on 12/13/1995
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The level of the Company's revenue and profits has historically
fluctuated from quarter-to-quarter and from year-to-year as the majority
of its revenue is derived from a small number of high dollar value
equipment sales to a relatively small number of customers.  Such
fluctuations are normal given the Company's reliance on a small number of
high value contracts for the majority of its revenue.  See "Business
Development - Growth Plan".

Domestic vs. International Revenue

International revenue generated approximately 83% of operating revenue in
the first quarter of fiscal 1996 as compared to 8% of operating revenue
in the first quarter of fiscal 1995.  The increase in international
revenue, both in absolute terms and as a percentage of operating revenue,
is attributable to two standard product contracts received by the Company
from European customers in the fourth quarter of fiscal 1995. 

Management expects the international market to continue to be a major
source of revenue in fiscal 1996 and future years.  To insure against
foreign currency transaction losses, international revenues are
contracted in US dollars.  The Company receives substantial deposits on
many large contracts with international customers.  Many such contracts
are secured by irrevocable letters of credit.  

Other Income

Other income, for the periods presented, is comprised principally of
interest income.  The level of such income is determined by cash on hand
and interest rates.  The timing of contract receipt and level of deposits
received have a substantial impact on such income.

Business Development

Growth Plan

One challenge facing the Company is to develop additional markets that
will allow future growth in revenue and profits.  In early fiscal 1995,
Management developed a three-pronged growth plan to add revenue and
profits to the Company's current core business. 

The first growth area involves the use and sale of airborne digital
cameras ("ADC") developed by the Company for the mapping of
infrastructure within narrow corridors.  Examples of the types of
infrastructure that would be mapped with such a system include gas
pipelines, electrical distribution systems, railroads and highways.  The
Company is currently developing an enhanced version of the ADC and is
investigating various image processing systems that may be bundled with
the ADC for delivery to its customers and for use by the Company in
performing services for customers.  The Company has recently received a
contract for which it will utilize the ADC and has partially completed
the contract.  The Company has also performed two demonstration projects
with its ADC and is hoping to use the data gathered as a result of these
projects to obtain a pilot program

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