DENVER, Oct. 29, 2025 (GLOBE NEWSWIRE) -- authID® (Nasdaq: AUID) (“authID” or the “Company”), a leading provider of biometric identity verification and authentication solutions, today announced the Company will report financial results for the third quarter ended September 30, 2025, on Wednesday, November 12, 2025, after the market close. Following issuance of the earnings release, authID Chief Executive Officer Rhon Daguro and Chief Financial Officer Ed Sellitto will host a webcast at 5:00 p.m. ET to discu ...

Core Insights - authID has been selected by one of the largest retailers in Europe to implement its PrivacyKey biometric technology for identity verification and password reset systems, enhancing security and user experience [1][3] Company Strategy - The recent deployment aligns with authID's strategy to secure contracts with large enterprise customers, as discussed by CEO Rhon Daguro during the August 14, 2025 earnings call [2] - The integration of authID's technology with the retailer's existing IT infrastructure has led to strong adoption among users, demonstrating the effectiveness of the company's market positioning [3] Product Performance - Early operational results from the retailer indicate a significant reduction in failed password reset attempts, improved onboarding and verification rates, and decreased reliance on manual helpdesk interventions, which enhances user outcomes and reduces support costs [4] Partnerships and Future Innovations - authID is expanding its partnership with a large biometric hardware provider through an OEM arrangement for its Proof and PrivacyKey products, indicating ongoing growth and collaboration in the biometric identity verification space [5] - The company aims to integrate its IDX solution for securing AI efforts, enhancing the security and efficiency of its customer base in the long term [6] Company Overview - authID provides a patented biometric identity platform that ensures secure verification of users, preventing cybercriminal activities and ensuring regulatory compliance by not storing biometric data [7]

Core Viewpoint - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1]. Group 1: Oversold Stocks - Endava PLC (DAVA) has an RSI of 29.8, with a stock price decline of approximately 34% over the past month, reaching a 52-week low of $9.12 [8]. - Neonode Inc (NEON) has an RSI of 23.5, with a significant stock price drop of around 84% in the last month, hitting a 52-week low of $3.80 [9]. - authID Inc (AUID) has an RSI of 29.54, with its stock falling about 36% over the past month, reaching a 52-week low of $2.65 [9]. Group 2: Company Performance Insights - Endava's CEO noted that over half of their employees are now using AI in projects, indicating progress towards becoming AI-native, despite a cautious outlook due to volatile operating conditions [8]. - Neonode anticipates $15-20 million from a patent settlement with Samsung Electronics, which may influence future performance [9]. - authID reported its highest quarterly revenue in history, showcasing effective execution of its growth strategy, despite a recent stock decline [9].

Core Viewpoint - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1]. Group 1: Oversold Stocks - Endava PLC (DAVA) has an RSI of 29.8, with a stock price decline of approximately 34% over the past month, reaching a 52-week low of $9.12 [8]. - Neonode Inc (NEON) has an RSI of 23.5, with a significant stock price drop of around 84% in the last month, hitting a 52-week low of $3.80 [9]. - authID Inc (AUID) has an RSI of 29.54, with a stock price decrease of about 36% over the past month, reaching a 52-week low of $2.65 [9]. Group 2: Company Performance Insights - Endava's CEO noted that over half of their employees are now using AI in projects, indicating progress towards becoming AI-native, despite a cautious outlook due to volatile operating conditions [8]. - Neonode anticipates $15-20 million from a patent settlement with Samsung Electronics, which may influence future stock performance [9]. - authID reported its highest quarterly revenue in history, showcasing effective execution of its growth strategy, although the stock has still faced a decline [9].

Core Insights - A strategic partnership between authID and MajorKey Technologies aims to enhance biometric identity verification within the Microsoft Entra Suite, addressing the rise of AI-driven fraud [1][2][3] Company Overview - authID is a provider of biometric identity verification solutions, offering a patented platform that ensures secure user identification without storing biometric data, achieving a false match rate of 1 in 1 billion [4] - MajorKey Technologies specializes in identity security, providing advisory and integration services for Microsoft Entra Suite, and has a strong partnership network including CyberArk and SailPoint [5] Industry Context - The partnership comes at a critical time as 17% of hiring managers have reported encountering candidates using deepfake technology in interviews, with projections indicating that by 2028, 25% of job candidate profiles could be fake [2] - The evolving threat landscape necessitates advanced identity verification solutions to combat fraudulent hiring processes and insider threats [3][4] Technology Features - authID's Proof technology offers biometric identity verification in 700 milliseconds, capable of detecting deepfake attempts in real-time, thus ensuring compliance and a seamless user experience [3][4]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 increased significantly to $1,400,000 compared to $300,000 last year and $300,000 in Q1 2025, driven by the go-live of several contracts signed earlier in 2024 [21][22] - Operating expenses for Q2 were $5,900,000 compared to $3,600,000 a year ago and $4,700,000 last quarter, primarily due to increased headcount investment in sales and R&D [22] - Net loss for the quarter was $4,400,000, with net loss per share at $0.33 compared to $0.34 a year ago and $0.40 last quarter [23] - Adjusted EBITDA loss was $3,400,000 for Q2 compared with a $2,500,000 loss for the same period last year [25] - Annual recurring revenue (ARR) as of Q2 is $5,800,000 compared to $1,100,000 of ARR as of Q2 2024 [25] Business Line Data and Key Metrics Changes - The company launched the IDX platform in late July, aimed at eliminating identity fraud within the supply chain workforce [9] - A major Fortune Global 500 customer in the UK went live with the company's privacy key product after a successful pilot [10] - The partnership with Proof, a large identity fraud platform, is expected to start generating revenue in Q3 2025 [12][14] Market Data and Key Metrics Changes - The identity management market is estimated to reach $61 billion by 2032, with the company now able to participate in the entire market space due to the IDX platform [19] - Remaining Performance Obligation (RPO) as of June 30, 2025, was $13,800,000, a decrease of approximately $100,000 over the prior quarter [23] Company Strategy and Development Direction - The company emphasizes the integration of facial biometrics into identity management strategies to combat fraud [8] - The partnership with NEC aims to demonstrate interoperability of reusable identity across countries without changes to existing systems [11] - The company is focusing on performance-based production-level pilots to showcase capabilities to prospects, which shortens the time to revenue [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to collect on customer contracts despite a provision for estimated credit loss [22] - The company is optimistic about the growth trajectory and expects to meet its goal of $18 million in bookings for 2025 [30] - Management acknowledged the need for ongoing innovation and improvements to meet customer demands [72] Other Important Information - The company has added 2,200,000 shares from a recent fundraising, with a cash balance of $8,300,000 as of June 30, 2025 [24] - The IDX platform is built on a fast-adopted standard, enhancing the company's visibility and credibility in the market [17] Q&A Session Summary Question: Can you talk about the deferred revenue and its nature? - The deferred revenue of $1,200,000 came from invoices issued based on customer contracts that have not yet been recognized as revenue, and it is recurring in nature [32][34] Question: When will the company start collecting revenue from the Proof partnership? - The company is about to take a customer live shortly, which will allow for revenue recognition once transactions are billed [46][49] Question: What is the status of the Indian contract signed last November? - The company is still ramping up with the Indian contract but has started recognizing revenue as they went live with the customer [55][58] Question: Will the company still collect the $3,300,000 from the Indian contract this year? - The company expects to recognize the full $3,300,000 commitment by the end of the first contract year, despite delays in the go-live [60][64] Question: Can you provide details on the NEC deal and its revenue implications? - Currently, the company cannot disclose specific booking estimates or revenue terms for the NEC deal as they are still finalizing details [65] Question: Is the company comfortable with the $18 million bookings target for the year? - Management confirmed they are still on track to meet the $18 million bookings target for 2025 [67] Question: How is the company managing the transition from pilots to revenue? - The company has shifted to using production-level pilots, which allows for quicker transitions to revenue compared to traditional proof of concept methods [81][84]

[Q2 2025 Earnings Overview](index=1&type=section&id=Q2%202025%20Earnings%20Overview) [Executive Summary](index=1&type=section&id=Executive%20Summary) authID achieved record quarterly revenue of **$1.4 million** in Q2 2025, though net and adjusted EBITDA losses expanded due to higher operating expenses, with the CEO noting strategic advancements and IDX launch Executive Summary Financial Highlights | Metric | Q2 2025 ($) | Q2 2024 ($) | Change ($) | | :------------------- | :---------- | :---------- | :----- | | **Total Revenue** | $1.4 million | $0.3 million | +$1.1 million | | **Operating Expenses** | $5.9 million | $3.6 million | +$2.3 million | | **Net Loss** | $4.5 million | $3.3 million | +$1.2 million | | **Loss Per Share** | $0.33 | $0.34 | -$0.01 | | **Adjusted EBITDA Loss** | $3.4 million | $2.5 million | +$0.9 million | | **Booked Annual Recurring Revenue (bARR)** | $2.2 million | $0.6 million | +$1.6 million | - CEO Rhon Daguro stated the company achieved its highest quarterly revenue, demonstrating effective execution of growth plans, and highlighted team dedication, technology enhancements, and market expansion progress[3](index=3&type=chunk) - The company recently launched IDX, a significant advancement in the identity industry, substantially expanding its total addressable market[3](index=3&type=chunk) [Recent Business and Operational Highlights](index=2&type=section&id=Recent%20Business%20and%20Operational%20Highlights) authID made significant business and operational strides in Q2 2025, including the IDX launch with NEC, a paid production pilot with a UK Fortune 500 company, and an agreement with Prove, alongside PrivacyKeyTM enhancements and new board appointments - Partnership with NEC, the world's largest biometric hardware provider, for IDX launch significantly expanded the company's total addressable market in the identity management industry[12](index=12&type=chunk) - Secured a paid live production pilot agreement with a UK Fortune Global 500 company, anticipated to convert into a long-term agreement upon completion[12](index=12&type=chunk) - Signed an agreement with Prove, one of the world's largest identity fraud platforms, with the first joint customer launch imminent[12](index=12&type=chunk) - Enhanced PrivacyKeyTM's one-to-many search capability, launched in production pilots, offering the market's fastest speed and highest accuracy[12](index=12&type=chunk) [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) [Second Quarter 2025 Financial Performance](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Performance) In Q2 2025, authID's total revenue surged to **$1.4 million** from **$0.3 million** year-over-year, but operating expenses also rose to **$5.9 million**, leading to an expanded net loss of **$4.4 million** and an adjusted EBITDA loss of **$3.4 million** Second Quarter 2025 Financial Performance Summary | Metric | Q2 2025 ($) | Q2 2024 ($) | Change ($) | | :------------------- | :---------- | :---------- | :----- | | **Total Revenue** | $1.4 million | $0.3 million | +$1.1 million | | **Operating Expenses** | $5.9 million | $3.6 million | +$2.3 million | | **Net Loss** | $4.4 million | $3.3 million | +$1.1 million | | **Loss Per Share** | $0.33 | $0.34 | -$0.01 | | **Adjusted EBITDA Loss** | $3.4 million | $2.5 million | +$0.9 million | [Six Months Ended June 30, 2025 Financial Performance](index=2&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Financial%20Performance) For the six months ended June 30, 2025, authID's total revenue grew to **$1.7 million** from **$0.4 million**, but operating expenses increased to **$10.6 million** due to higher headcount and R&D investments, resulting in an **$8.7 million** net loss and **$7.3 million** adjusted EBITDA loss Six Months Ended June 30, 2025 Financial Performance Summary | Metric | H1 2025 ($) | H1 2024 ($) | Change ($) | | :------------------- | :---------- | :---------- | :----- | | **Total Revenue** | $1.7 million | $0.4 million | +$1.3 million | | **Operating Expenses** | $10.6 million | $6.9 million | +$3.7 million | | **Net Loss** | $8.7 million | $6.3 million | +$2.4 million | | **Loss Per Share** | $0.72 | $0.67 | +$0.05 | | **Adjusted EBITDA Loss** | $7.3 million | $4.9 million | +$2.4 million | - Operating expenses increased primarily due to higher headcount, continued investments in sales and R&D, and an **$0.8 million** increase in estimated credit loss reserves[7](index=7&type=chunk)[10](index=10&type=chunk) [Remaining Performance Obligation (RPO)](index=2&type=section&id=Remaining%20Performance%20Obligation%20%28RPO%29) As of June 30, 2025, authID's Remaining Performance Obligation (RPO) significantly increased to **$13.8 million**, comprising **$1.2 million** in deferred revenue and **$12.6 million** in other non-cancelable contract amounts, up from **$4.2 million** in the prior year Remaining Performance Obligation (RPO) Summary | Metric | June 30, 2025 ($) | June 30, 2024 ($) | Change ($) | | :------------------- | :-------------- | :-------------- | :----- | | **Remaining Performance Obligation (RPO)** | $13.8 million | $4.2 million | +$9.6 million | | **Deferred Revenue** | $1.2 million | - | - | | **Other Non-Cancelable Contract Amounts** | $12.6 million | - | - | - The company expects to recognize the **$13.8 million** RPO over the entire contract lifecycle, typically a 3-year period[11](index=11&type=chunk) [Booked Annual Recurring Revenue (bARR) and Annual Recurring Revenue (ARR)](index=3&type=section&id=Booked%20Annual%20Recurring%20Revenue%20%28bARR%29%20and%20Annual%20Recurring%20Revenue%20%28ARR%29) authID's total Booked Annual Recurring Revenue (bARR) reached **$2.2 million** in Q2 2025, a significant increase from **$0.63 million** year-over-year, including **$0.9 million** cARR and **$1.2 million** UAC, while Annual Recurring Revenue (ARR) grew to **$5.8 million** as of June 30, 2025 Booked and Annual Recurring Revenue Summary | Metric | Q2 2025 ($) | Q2 2024 ($) | Change ($) | | :------------------- | :---------- | :---------- | :----- | | **Total bARR** | $2.2 million | $0.63 million | +$1.57 million | | **Net bARR** | $1.9 million | $0.63 million | +$1.27 million | | **cARR (Q2 2025)** | $0.9 million | - | - | | **UAC (Q2 2025)** | $1.2 million | - | - | | **ARR (as of June 30, 2025)** | $5.8 million | $1.1 million | +$4.7 million | - Total bARR for the first half of 2025 was **$2.2 million**, up from **$0.73 million** in the prior year, with net bARR at **$1.8 million**, also up from **$0.73 million**[14](index=14&type=chunk) - Net bARR reflects contract amounts removed from previously reported bARR due to delays in certain customer production go-lives and usage ramp-ups[15](index=15&type=chunk) [Corporate Information](index=3&type=section&id=Corporate%20Information) [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) authID will host a conference call and webcast on August 14, 2025, at 5:00 PM ET, led by CEO Rhon Daguro and CFO Ed Sellitto, to discuss financial results and provide company updates, with registration required for dial-in details and webcast access available on the investor relations website - The conference call and webcast are scheduled for August 14, 2025, at 5:00 PM ET[17](index=17&type=chunk) - authID CEO Rhon Daguro and CFO Ed Sellitto will host to discuss financial results and company updates[17](index=17&type=chunk) - Participants must register to receive dial-in details, and the webcast will be available on the company's "Events & Presentations" page[18](index=18&type=chunk) [About authID Inc.](index=4&type=section&id=About%20authID%20Inc.) authID Inc. (Nasdaq: AUID) is a leading provider of biometric identity verification and authentication solutions, ensuring enterprises "Know Who's Behind the Device™" with its easy-to-integrate, patented biometric identity platform, PrivacyKey, designed to prevent fraud and eliminate password risks - authID provides biometric identity verification and authentication solutions, ensuring enterprises "Know Who's Behind the Device™"[20](index=20&type=chunk) - Its patented biometric identity platform completes biometric identity verification in **700 milliseconds** and biometric authentication in **25 milliseconds**, offering fast, accurate, and user-friendly account recovery[20](index=20&type=chunk) - The PrivacyKey solution offers a 1-in-1 billion false match rate without storing biometric data, effectively preventing fraud, deepfakes, and account takeover[20](index=20&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements regarding future operations, growth, sales, potential contracts, bARR, ARR, cash flow, cash position, and financial condition, based on assumptions and subject to various risks including customer attraction, service implementation, competition, regulatory changes, international trade, and macroeconomic conditions - Forward-looking statements cover future operating results, growth and sales, potential contract signings, bARR, ARR, cash flow, cash position, and financial condition[21](index=21&type=chunk) - Actual results may differ materially due to various risk factors, including the company's ability to attract and retain customers, successful service implementation, effective competition, changes in laws and regulations, international trade conditions, and economic and political conditions[21](index=21&type=chunk) - Forward-looking statements are made as of the date of release and should not be relied upon as guidance for future performance, with no obligation for the company to update or revise them[21](index=21&type=chunk) [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) [Adjusted EBITDA](index=5&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA is a non-GAAP financial measure provided by the company to offer useful insights into its cyclical performance and core business activities when used with GAAP results, which management believes aids analysts, investors, and other stakeholders in evaluating comparable companies and assessing operational performance - Adjusted EBITDA is a non-GAAP financial measure management deems useful for evaluating the company's core business activities and operational performance[23](index=23&type=chunk) - Adjusted EBITDA reconciles GAAP net income (loss) by excluding interest expense, interest income, income tax provision, depreciation and amortization, stock-based compensation expense, and other items management believes affect the comparability of operating results[24](index=24&type=chunk) Reconciliation of Loss from Continuing Operations to Adjusted EBITDA (Non-GAAP) | | Three Months Ended | | Six Months Ended | | :--------------------------------------- | :---------- | :---------- | :---------- | :---------- | | | June 30, 2025 ($) | June 30, 2024 ($) | June 30, 2025 ($) | June 30, 2024 ($) | | **Loss from Continuing Operations** | $ (4,384,779) | $ (3,261,241) | $ (8,724,246) | $ (6,318,818) | | **Add-back items:** | | | | | | Net interest expense | 171 | 10,369 | 12,883 | 23,507 | | Interest income | (86,846) | (73,957) | (138,390) | (182,877) | | Severance | - | 8,638 | - | 14,251 | | Depreciation and amortization | 30,249 | 44,004 | 60,441 | 87,412 | | Stock-based compensation | 1,078,201 | 725,704 | 1,532,540 | 1,448,675 | | **Adjusted EBITDA from Continuing Operations (Non-GAAP)** | $ (3,363,004) | $ (2,546,483) | $ (7,256,772) | $ (4,927,850) | [Booked Annual Recurring Revenue (bARR) and Annual Recurring Revenue (ARR)](index=6&type=section&id=Booked%20Annual%20Recurring%20Revenue%20%28bARR%29%20and%20Annual%20Recurring%20Revenue%20%28ARR%29) bARR (Booked Annual Recurring Revenue) is defined as the annual recurring revenue the company expects to derive from signed orders within 18 months of contract signing, comprising Committed Annual Recurring Revenue (cARR) and estimated Usage Above Contract (UAC), while ARR (Annual Recurring Revenue) is defined as recurring revenue recognized under GAAP for the last three months of the relevant period multiplied by four, with both non-GAAP metrics indicating future revenue growth trends but not serving as predictions - bARR is defined as the annual recurring revenue the company expects to derive from signed orders within 18 months of contract signing, composed of Committed Annual Recurring Revenue (cARR) and estimated Usage Above Contract (UAC)[28](index=28&type=chunk) - ARR is defined as recurring revenue recognized under GAAP for the last three months of the relevant period multiplied by four[29](index=29&type=chunk) - bARR and ARR should not be considered forecasts of future revenue but rather indicators of revenue trend direction, as actual GAAP revenue may differ significantly from these metrics[31](index=31&type=chunk) [Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) [Statements of Operations](index=7&type=section&id=Statements%20of%20Operations) authID's condensed consolidated statements of operations show significant net revenue growth for both Q2 and the first half of 2025, but total operating expenses also increased substantially, leading to expanded losses from continuing operations and net losses across both periods Summary of Condensed Consolidated Statements of Operations | Metric | Q2 2025 ($) | Q2 2024 ($) | H1 2025 ($) | H1 2024 ($) | | :----------------------- | :---------- | :---------- | :---------- | :---------- | | **Net Revenue** | $1,444,599 | $280,438 | $1,740,855 | $437,816 | | **Total Operating Expenses** | $5,916,053 | $3,605,267 | $10,590,608 | $6,916,004 | | **Loss from Continuing Operations** | $(4,471,454) | $(3,324,829) | $(8,849,753) | $(6,478,188) | | **Net Loss** | $(4,384,779) | $(3,261,241) | $(8,724,246) | $(6,318,818) | | **Net Loss Per Share** | $(0.33) | $(0.34) | $(0.72) | $(0.67) | [Balance Sheets](index=8&type=section&id=Balance%20Sheets) As of June 30, 2025, authID's total assets increased to **$15.8 million** from **$14.5 million** at December 31, 2024, driven by higher cash, accounts receivable, and deferred contract costs, while total liabilities slightly decreased and total stockholders' equity rose to **$13.0 million** Summary of Condensed Consolidated Balance Sheets | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :----------------------- | :-------------- | :-------------- | | **Total Assets** | $15,813,514 | $14,471,377 | | **Cash** | $8,300,280 | $8,471,561 | | **Accounts Receivable, Net** | $1,079,776 | $97,897 | | **Contract Assets** | $564,070 | $426,859 | | **Total Liabilities** | $2,819,790 | $2,956,188 | | **Total Stockholders' Equity** | $12,993,724 | $11,515,189 | [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, authID's net cash outflow from operating activities increased to **$8.39 million** from **$5.75 million** year-over-year, primarily due to expanded net loss and changes in working capital, with net cash outflow from investing activities at **$1,700**, and net cash inflow from financing activities at **$8.22 million** mainly from common stock sales, resulting in an ending cash balance of **$8.30 million** Summary of Condensed Consolidated Statements of Cash Flows | Metric | H1 2025 ($) | H1 2024 ($) | | :----------------------- | :---------- | :---------- | | **Net Cash Outflow from Operating Activities** | $(8,388,822) | $(5,749,651) | | **Net Cash Outflow from Investing Activities** | $(1,700) | $(15,582) | | **Net Cash Inflow from Financing Activities** | $8,219,327 | $10,001,398 | | **Net Change in Cash** | $(171,281) | $4,230,294 | | **Cash at End of Period** | $8,300,280 | $14,407,393 | - Increased cash outflow from operating activities was mainly due to an expanded net loss, higher accounts receivable, and increased deferred revenue[37](index=37&type=chunk) - Cash inflow from financing activities primarily resulted from net proceeds of **$8.46 million** from common stock sales, partially offset by **$0.245 million** in convertible note repayments[37](index=37&type=chunk)

Q2 2025 Results Conference Call August 14, 2025 © 2025 authID Inc. All Rights Reserved. Disclaimer & Forward Looking Statements This Presentation and information provided at a webcast or meeting at which it is presented (the "Presentation") has been prepared on the basis of information furnished by the management of authID Inc. ("authID" or the "Company") and has not been independently verified by any third party. This Presentation is provided for information purposes only. This Presentation is not an offer ...

[Filing Information and Corporate Details](index=1&type=section&id=Filing%20Information%20and%20Corporate%20Details) [Form 10-Q General Information](index=1&type=section&id=1.1.%20Form%2010-Q%20General%20Information) This section details the filing as a Quarterly Report (Form 10-Q) for the period ended June 30, 2025, for authID Inc., a Delaware corporation. It specifies the company's filing status as a non-accelerated filer and smaller reporting company, and lists the common stock trading on NASDAQ - The filing is a **Quarterly Report (Form 10-Q)** for the period ended **June 30, 2025**[1](index=1&type=chunk) Metric | Value | :-------------------------------- | :-------------------- | | Registrant Name | authID Inc. | | State of Incorporation | Delaware | | Commission File Number | 001-40747 | | Trading Symbol | AUID | | Exchange | The NASDAQ Stock Market LLC | | Filer Status | Non-accelerated filer, Smaller reporting company | | Common Stock Outstanding (Aug 12, 2025) | 13,443,740 shares | [Registrant Information](index=1&type=section&id=1.2.%20Registrant%20Information) This section provides the corporate contact details for authID Inc. and confirms its compliance with SEC filing requirements, including electronic submission of Interactive Data Files, and clarifies that it is not a shell company - The registrant's principal executive offices are located at 1580 North Logan Street, Suite 660, Unit 51767, Denver, CO 80203, with a telephone number of 516-274-8700[3](index=3&type=chunk) - The registrant has filed all required reports during the preceding **12 months** and has been subject to filing requirements for the past **90 days** (**Yes**)[4](index=4&type=chunk) - The registrant has submitted electronically every Interactive Data File required during the preceding **12 months** (**Yes**)[5](index=5&type=chunk) - The registrant is not a shell company (**No**)[7](index=7&type=chunk) [Forward-Looking Statements and Risk Factors](index=4&type=section&id=1.3.%20Forward-Looking%20Statements%20and%20Risk%20Factors) This section includes a cautionary statement regarding forward-looking information, emphasizing that actual results may differ materially due to various known and unknown risks. It lists several key risk factors, such as lack of significant revenues, market acceptance, ability to raise capital, and macroeconomic conditions - Forward-looking statements are based on current expectations and future events, but actual results may differ materially due to known and unknown risks[11](index=11&type=chunk) - Key risk factors include: lack of significant revenues, positive cash flow and history of losses; market acceptance of products and competition; ability to attract and retain customers and key personnel; reliance on third-party software; security breaches; ability to raise capital; ability to maintain Nasdaq listing; intellectual property protection; ability to operate in non-US markets; impact of global conflicts; stock price volatility; legislation and government regulation; and general economic conditions, inflation and access to capital[17](index=17&type=chunk) [Company Information and Definitions](index=4&type=section&id=1.4.%20Company%20Information%20and%20Definitions) This section defines the terms 'authID,' 'Company,' 'we,' 'our,' 'us,' and similar terms as referring to authID Inc., a Delaware corporation, and its subsidiaries. It also clarifies that information on the company's website is not part of this report - The terms 'authID,' 'Company,' 'we,' 'our,' 'us,' and similar terms refer to authID Inc., a Delaware corporation, and its subsidiaries[15](index=15&type=chunk) - Information on the company's website (www.authID.ai) is not incorporated into this report[16](index=16&type=chunk) [PART I – FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements for authID Inc. and its subsidiaries, including balance sheets, statements of operations, comprehensive loss, stockholders' equity, and cash flows, along with accompanying notes. These statements are prepared in accordance with Form 10-Q instructions and GAAP, with certain information condensed or omitted - The financial statements are **unaudited** and prepared in accordance with **Form 10-Q instructions**, including only normal recurring accruals[32](index=32&type=chunk) - Certain information and footnote disclosures normally included in GAAP consolidated financial statements have been **condensed or omitted**[32](index=32&type=chunk) - The consolidated financial statements include authID Inc. and its wholly-owned subsidiaries, with all significant intercompany balances and transactions **eliminated**[33](index=33&type=chunk) [Condensed Consolidated Balance Sheets](index=6&type=page&id=2.1.1.%20Condensed%20Consolidated%20Balance%20Sheets) Metric | June 30, 2025 | December 31, 2024 | :-------------------------- | :-------------- | :---------------- | | **ASSETS** | | | | Cash | $8,300,280 | $8,471,561 | | Accounts receivable, net | $1,079,776 | $97,897 | | Contract assets | $564,070 | $426,859 | | Deferred contract costs | $697,304 | $617,918 | | Other current assets, net | $833,875 | $460,192 | | Total current assets | $11,475,305 | $10,074,427 | | Intangible Assets, net | $154,977 | $213,718 | | Goodwill | $4,183,232 | $4,183,232 | | Total assets | $15,813,514 | $14,471,377 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Accounts payable and accrued expenses | $1,357,194 | $1,715,410 | | Commission liability | $308,194 | $459,657 | | Severance liability | $- | $325,000 | | Convertible debt, net | $- | $240,884 | | Deferred revenue | $1,154,402 | $215,237 | | Total current liabilities | $2,819,790 | $2,956,188 | | Total liabilities | $2,819,790 | $2,956,188 | | Common stock, par value $0.0001 | $1,344 | $1,092 | | Additional paid-in capital | $195,515,123 | $185,312,508 | | Accumulated deficit | $(182,532,775) | $(173,808,529) | | Accumulated comprehensive income | $10,032 | $10,118 | | Total stockholders' equity | $12,993,724 | $11,515,189 | | Total liabilities and stockholders' equity | $15,813,514 | $14,471,377 | [Condensed Consolidated Statements of Operations](index=7&type=page&id=2.1.2.%20Condensed%20Consolidated%20Statements%20of%20Operations) Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | :---------------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Revenues, net | $1,444,599 | $280,438 | $1,740,855 | $437,816 | | General and administrative | $3,906,933 | $2,169,160 | $6,552,633 | $4,231,521 | | Research and development | $1,978,871 | $1,392,103 | $3,977,534 | $2,597,071 | | Depreciation and amortization | $30,249 | $44,004 | $60,441 | $87,412 | | Total operating expenses | $5,916,053 | $3,605,267 | $10,590,608 | $6,916,004 | | Loss from continuing operations | $(4,471,454) | $(3,324,829) | $(8,849,753) | $(6,478,188) | | Interest expense, net | $(171) | $(10,369) | $(12,883) | $(23,507) | | Interest income | $86,846 | $73,957 | $138,390 | $182,877 | | Other income (expense), net | $86,675 | $63,588 | $125,507 | $159,370 | | Loss from continuing operations before income taxes | $(4,384,779) | $(3,261,241) | $(8,724,246) | $(6,318,818) | | Net loss | $(4,384,779) | $(3,261,241) | $(8,724,246) | $(6,318,818) | | Net Loss Per Share - Basic and Diluted | $(0.33) | $(0.34) | $(0.72) | $(0.67) | | Weighted Average Shares Outstanding - Basic and Diluted | 13,222,454 | 9,501,691 | 12,078,039 | 9,475,956 | [Condensed Consolidated Statements of Comprehensive Loss](index=8&type=page&id=2.1.3.%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | :-------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Net Loss | $(4,384,779) | $(3,261,241) | $(8,724,246) | $(6,318,818) | | Foreign currency translation loss | $122 | $(10,594) | $(86) | $(6,516) | | Comprehensive loss | $(4,384,657) | $(3,271,835) | $(8,724,332) | $(6,325,334) | [Condensed Consolidated Statements of Stockholders' Equity](index=9&type=page&id=2.1.4.%20Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) - Total stockholders' equity as of **June 30, 2025**, was **$12,993,724**, compared to **$11,515,189** as of **December 31, 2024**[28](index=28&type=chunk) - During the six months ended **June 30, 2025**, the company issued common stock for cash, net of offering costs, totaling **$8,464,327**[28](index=28&type=chunk) - Stock-based compensation for the six months ended **June 30, 2025**, was **$1,001,207**[28](index=28&type=chunk) - The accumulated deficit increased to **$(182,532,775)** as of **June 30, 2025**, from **$(173,808,529)** at **December 31, 2024**, primarily due to a net loss of **$(8,724,246)**[28](index=28&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=10&type=page&id=2.1.5.%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | :---------------------------------- | :----------------------------- | :----------------------------- | | Net cash flows from operating activities | $(8,388,822) | $(5,749,651) | | Net cash flows from investing activities | $(1,700) | $(15,582) | | Net cash flows from financing activities | $8,219,327 | $10,001,398 | | Effect of Foreign Currencies | $(86) | $(5,871) | | Net Change in Cash | $(171,281) | $4,230,294 | | Cash, Beginning of the Period | $8,471,561 | $10,177,099 | | Cash, End of the Period | $8,300,280 | $14,407,393 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=page&id=2.1.6.%20Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed disclosures and explanations for the figures presented in the condensed consolidated financial statements, covering accounting policies, significant estimates, and specific financial line items [NOTE 1 – BASIS OF PRESENTATION](index=11&type=page&id=2.1.6.1.%20NOTE%201%20%E2%80%93%20BASIS%20OF%20PRESENTATION) - As of **June 30, 2025**, the Company had an accumulated deficit of approximately **$182.5 million** and incurred a net loss of approximately **$8.7 million** for the six months ended **June 30, 2025**[34](index=34&type=chunk) - The Company used approximately **$8.4 million** to fund its operations for the six months ended **June 30, 2025**[34](index=34&type=chunk) - The continuation of the Company as a going concern is dependent upon financial support, additional financing, and generating sufficient cash flows, leading to **substantial doubt about its ability to continue as a going concern**[35](index=35&type=chunk)[36](index=36&type=chunk) Potentially Dilutive Securities Excluded from Diluted Loss Per Share | Security | 2025 | 2024 | | :---------------------- | :----- | :----- | | Convertible notes payable | - | 8,277 | | Warrants | 719,965 | 697,446 | | Stock options | 2,249,454 | 1,852,819 | | **Total** | **2,969,419** | **2,558,542** | - Deferred revenue contract liabilities were approximately **$1.15 million** as of **June 30, 2025**, up from **$0.22 million** as of **December 31, 2024**, and are expected to be earned over the next twelve months[42](index=42&type=chunk) - The Company's Remaining Performance Obligation (RPO) was **$13.77 million** as of **June 30, 2025**, with approximately **39%** expected to be recognized as revenue over the next twelve months[43](index=43&type=chunk) Changes in Allowance for Credit Losses | Metric | June 30, 2025 | | :-------------------------- | :-------------- | | Balance at December 31, 2024 | $149,720 | | Provision for expected credit loss | $769,214 | | Write-offs, net | $(193,176) | | Balance at June 30, 2025 | $725,758 | - As of **June 30, 2025**, **one customer** accounted for **92%** of gross accounts receivable, and **two customers** represented **73%** of revenue for the six months ended **June 30, 2025**[48](index=48&type=chunk)[49](index=49&type=chunk) - As of **June 30, 2025**, **two customers** accounted for **78%** of the Company's Remaining Performance Obligation[51](index=51&type=chunk) [NOTE 2 – OTHER CURRENT ASSETS](index=14&type=page&id=2.1.6.2.%20NOTE%202%20%E2%80%93%20OTHER%20CURRENT%20ASSETS) Other Current Assets | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Prepaid third-party and related party services | $433,502 | $337,873 | | Prepaid insurance | $319,190 | $141,002 | | Commissions advances | $62,500 | $- | | **Total Other Current Assets** | **$833,875** | **$460,192** | [NOTE 3 – INTANGIBLE ASSETS, NET (OTHER THAN GOODWILL)](index=14&type=page&id=2.1.6.3.%20NOTE%203%20%E2%80%93%20INTANGIBLE%20ASSETS,%20NET%20(OTHER%20THAN%20GOODWILL)) Intangible Assets Activity (Six Months Ended June 30, 2025) | Item | Acquired and Developed Software | Patents | Total | | :-------------------------- | :---------------------------- | :-------- | :-------- | | Carrying Value at Dec 31, 2024 | $99,819 | $113,899 | $213,718 | | Additions | $- | $1,700 | $1,700 | | Amortization | $(51,275) | $(9,166) | $(60,441) | | Carrying Value at June 30, 2025 | $48,544 | $106,433 | $154,977 | - Amortization expense totaled approximately **$60,000** for the six months ended **June 30, 2025**, compared to **$87,000** for the same period in **2024**[55](index=55&type=chunk) Future Expected Amortization of Intangible Assets | Year | Amount | | :-------------------------- | :------- | | 2025 (Remainder of the Year) | $26,860 | | 2026 | $37,226 | | 2027 | $30,442 | | 2028 | $18,389 | | 2029 | $18,389 | | Thereafter | $23,671 | | **Total** | **$154,977** | [NOTE 4 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES](index=15&type=page&id=2.1.6.4.%20NOTE%204%20%E2%80%93%20ACCOUNTS%20PAYABLE%20AND%20ACCRUED%20EXPENSES) Accounts Payable and Accrued Expenses | Item | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :-------------- | :---------------- | | Trade payables | $564,892 | $317,030 | | Accrued payroll and related obligations | $447,237 | $984,536 | | Other accrued expenses | $345,065 | $413,844 | | **Total** | **$1,357,194** | **$1,715,410** | [NOTE 5 – CONVERTIBLE NOTES PAYABLE](index=15&type=page&id=2.1.6.5.%20NOTE%205%20%E2%80%93%20CONVERTIBLE%20NOTES%20PAYABLE) - The Company issued Senior Secured Convertible Notes with an initial principal amount of approximately **$9.2 million** and a conversion price of **$3.70 per share** on **March 21, 2022**[58](index=58&type=chunk) - The Convertible Notes matured on **March 31, 2025**, and accrued interest at an annual rate of **9.75%**[59](index=59&type=chunk) - The outstanding Convertible Notes and accrued interest were **paid in full** on **March 31, 2025**[60](index=60&type=chunk) [NOTE 6 – RELATED PARTY TRANSACTIONS](index=16&type=page&id=2.1.6.6.%20NOTE%206%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) - The Company has a services agreement with The Pipeline Group, Inc. (TPG), where Ken Jisser, a Company director, is the founder and CEO. TPG provides outsourced sales services for **$70,000 per month**[61](index=61&type=chunk) - Total expense incurred under the TPG contract was approximately **$210,000** for the three months and **$420,000** for the six months ended **June 30, 2025**[61](index=61&type=chunk) - Dale Daguro, the brother of CEO Rhon Daguro, is employed as VP Sales, earning approximately **$97,000** (three months) and **$151,000** (six months) in base salary and sales commission during the period ended **June 30, 2025**[62](index=62&type=chunk) [NOTE 7 – STOCKHOLDERS' EQUITY](index=16&type=page&id=2.1.6.7.%20NOTE%207%20%E2%80%93%20STOCKHOLDERS'%20EQUITY) - During the six months ended **June 30, 2025**, the Company issued **1,811,120 shares** of common stock and pre-funded warrants for approximately **$6.8 million** net cash proceeds, and an additional **373,060 shares** for approximately **$1.6 million** net cash proceeds through registered direct offerings[63](index=63&type=chunk) - **200,000 shares** of common stock were issued under restricted stock awards (RSAs) to non-employee advisors, with a total grant-date fair value of **$1,594,000**[63](index=63&type=chunk)[66](index=66&type=chunk) Warrant Activity (Six Months Ended June 30, 2025) | Metric | Number of Warrants | Weighted Average Exercise Price | Weighted Average Remaining Life | | :-------------------------- | :----------------- | :------------------------------ | :------------------------------ | | Outstanding, December 31, 2024 | 697,446 | $11.20 | 3.2 Years | | Granted | 210,019 | $4.70 | 4.8 Years | | Exercised/Cancelled | (187,500) | $3.16 | - | | Outstanding, June 30, 2025 | 719,965 | $11.40 | 3.2 Years | - As of **June 30, 2025**, there was approximately **$3.3 million** of unrecognized compensation costs related to stock options outstanding, to be expensed through **2027**[71](index=71&type=chunk) - Stockholders approved an increase of **295,000 shares** allocated to the **2024 Equity Incentive Plan**, with **322,872 shares** available for issuance as of **June 30, 2025**[72](index=72&type=chunk) [NOTE 8 – COMMITMENTS AND CONTINGENCIES](index=19&type=page&id=2.1.6.8.%20NOTE%208%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) - The Company is a party to various legal or administrative proceedings in the ordinary course of business, but management believes the outcome will **not have a material adverse effect** on financial condition or results of operations[73](index=73&type=chunk) [NOTE 9 – SEGMENT INFORMATION](index=19&type=page&id=2.1.6.9.%20NOTE%209%20%E2%80%93%20SEGMENT%20INFORMATION) - The Company operates in a **single operating and reportable segment**, with the Chief Executive Officer (CODM) assessing overall performance and allocating resources based on consolidated net income (loss)[74](index=74&type=chunk) [NOTE 10 – SUBSEQUENT EVENTS](index=19&type=page&id=2.1.6.10.%20NOTE%2010%20%E2%80%93%20SUBSEQUENT%20EVENTS) - **There are no subsequent events to report**[75](index=75&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, results of operations, and future outlook, based on the unaudited financial statements. It discusses the business overview, platform, key trends, liquidity, and the impact of macro-economic conditions - The discussion is based on financial statements prepared in accordance with **U.S. GAAP**, requiring estimates and assumptions that affect reported amounts[76](index=76&type=chunk) - Management evaluates estimates and judgments on an ongoing basis, basing them on historical experience and reasonable factors[76](index=76&type=chunk) [Overview of Business and Platform](index=20&type=page&id=2.2.1.%20Overview%20of%20Business%20and%20Platform) - authID Inc. provides a **patented, biometric identity platform** to ensure secure customer and employee logins and transactions, offering biometric identity verification (Proof), biometric identity authentication (Verified), and account/access recovery[78](index=78&type=chunk)[79](index=79&type=chunk)[81](index=81&type=chunk)[83](index=83&type=chunk) - The PrivacyKey™ solution enables biometric authentication without storing biometric data, achieving a **1-to-1-billion false match rate** at a **0.3% false rejection rate**[82](index=82&type=chunk) - The platform aims to **stop fraud at onboarding, block deepfakes, prevent account takeover, and eliminate password risks** through a faster, frictionless, and accurate user identity experience[78](index=78&type=chunk) [Key Customer Benefits](index=21&type=page&id=2.2.2.%20Key%20Customer%20Benefits) - The authID platform allows enterprise customers to verify and authenticate users, benefit from **high-speed processing (less than 700ms response time)**, and precisely identify consumers and employees[84](index=84&type=chunk) - It provides a **seamless user experience**, supports a wide variety of devices, integrates quickly and easily, offers broad identity document coverage, and performs secure biometric verification/authentication without storing biometric data via PrivacyKey technology[84](index=84&type=chunk) [Key Trends and Growth Strategy](index=22&type=page&id=2.2.3.%20Key%20Trends%20and%20Growth%20Strategy) - Financial results are **impacted by market trends** including growing concerns over identity theft, fraud (including AI-assisted fraud), the growth in the sharing economy, and the increase in electronic payments[85](index=85&type=chunk)[92](index=92&type=chunk) - The Company plans to **grow its business** by increasing existing customer usage, adding new customers through direct sales and channel partners, and expanding into new markets and innovation[86](index=86&type=chunk) [Going Concern](index=22&type=page&id=2.2.4.%20Going%20Concern) - As of **June 30, 2025**, the Company had an accumulated deficit of approximately **$182.5 million**, a net loss of approximately **$8.7 million**, and used approximately **$8.4 million** to fund operations for the six months ended **June 30, 2025**[89](index=89&type=chunk) - The Company's continuation as a going concern is dependent on financial support from stockholders, additional debt or equity financing, and generating sufficient cash flows, leading to **substantial doubt about its ability to continue**[90](index=90&type=chunk)[91](index=91&type=chunk) - In **April and May 2025**, the Company raised approximately **$8.5 million** after expenses from existing and new stockholders through registered direct offerings[90](index=90&type=chunk) [Adjusted EBITDA (Non-GAAP)](index=23&type=page&id=2.2.5.%20Adjusted%20EBITDA%20(Non-GAAP)) - **Adjusted EBITDA** is a **non-GAAP financial measure** used by management to assess the performance of fundamental business activities, excluding items like interest, taxes, depreciation, amortization, and stock-based compensation[93](index=93&type=chunk) Reconciliation of Loss from Continuing Operations to Adjusted EBITDA | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Loss from continuing operations | $(4,384,779) | $(3,261,241) | $(8,724,246) | $(6,318,818) | | Addback: Interest expense, net | $171 | $10,369 | $12,883 | $23,507 | | Addback: Interest income | $(86,846) | $(73,957) | $(138,390) | $(182,877) | | Addback: Severance cost | $- | $8,638 | $- | $14,251 | | Addback: Depreciation and amortization | $30,249 | $44,004 | $60,441 | $87,412 | | Addback: Stock compensation | $1,078,201 | $725,704 | $1,532,540 | $1,448,675 | | **Adjusted EBITDA continuing operations (Non-GAAP)** | **$(3,363,004)** | **$(2,546,483)** | **$(7,256,772)** | **$(4,927,850)** | - Adjusted EBITDA has **limitations as an analytical tool**, as it does not reflect cash expenditures, working capital needs, or cash requirements for asset replacement[96](index=96&type=chunk) [Results of Operations (Three and Six Months Ended June 30, 2025 and 2024)](index=24&type=page&id=2.2.6.%20Results%20of%20Operations%20(Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024)) - Revenues, net, **increased significantly** to approximately **$1.4 million** for the three months ended **June 30, 2025** (from **$0.3 million** in **2024**), and to **$1.7 million** for the six months ended **June 30, 2025** (from **$0.4 million** in **2024**), primarily due to new customer contracts[97](index=97&type=chunk) - General and administrative expenses **increased by approximately $1.6 million** (three months) and **$2.2 million** (six months) due to employee-related expenses, shares issued to management advisors, and an **$0.8 million** provision for estimated credit loss[98](index=98&type=chunk) - Research and development expenses **increased by approximately $0.6 million** (three months) and **$1.4 million** (six months) due to continued investment in employees and contractors for product capabilities[99](index=99&type=chunk) - Depreciation and amortization expenses, and interest expense, net, **remained flat** compared to the prior year periods[100](index=100&type=chunk)[101](index=101&type=chunk) [Liquidity and Capital Resources](index=24&type=page&id=2.2.7.%20Liquidity%20and%20Capital%20Resources) - As of **June 30, 2025**, the Company had approximately **$8.3 million** of cash on hand and **$8.7 million** of working capital[102](index=102&type=chunk) - Cash used in operating activities was approximately **$8.4 million** for the six months ended **June 30, 2025**, compared to **$5.7 million** in the prior year[102](index=102&type=chunk) - Cash provided by financing activities was approximately **$8.2 million** for the six months ended **June 30, 2025**, primarily from the sale of common stock, net of offering costs[103](index=103&type=chunk) - The Company **will need to raise additional funds in 2025** to support operations and investments, with **no guarantee** that such financing will be available on acceptable terms[104](index=104&type=chunk) [Macro-Economic Conditions and Off-Balance Sheet Arrangements](index=25&type=page&id=2.2.8.%20Macro-Economic%20Conditions%20and%20Off-Balance%20Sheet%20Arrangements) - The global economy's political and economic uncertainty, including wars, inflation, and rising interest rates, **impacts spending on identity verification and security**, potentially affecting revenue growth[106](index=106&type=chunk) - The Company has **no off-balance sheet arrangements** that are reasonably likely to have a material adverse effect on its financial condition or results of operations[107](index=107&type=chunk) [Recent Accounting Policies](index=25&type=page&id=2.2.9.%20Recent%20Accounting%20Policies) - Recent material accounting policies critical to understanding financial results and conditions are discussed in **Note 1 of the financial statements**[108](index=108&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, authID Inc. is not required to include disclosures under this item - As a **smaller reporting company**, authID Inc. is **not required** to include disclosure under this item[109](index=109&type=chunk) [Item 4. Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025. There were no material changes in internal control over financial reporting during the six months ended June 30, 2025 - The Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were **effective** as of **June 30, 2025**[110](index=110&type=chunk) - **There were no material changes** in internal control over financial reporting during the six months ended **June 30, 2025**[111](index=111&type=chunk) [PART II – OTHER INFORMATION](index=26&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=26&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal or administrative proceedings in the ordinary course of business but does not anticipate any material adverse effect on its financial condition or results of operations from these matters - The Company is a party to various legal or administrative proceedings arising in the ordinary course of business[113](index=113&type=chunk) - Management has **no reason to believe** the outcome of such proceedings will have a material adverse effect on the financial condition or results of operations[113](index=113&type=chunk) [Item 1A. Risk Factors](index=26&type=page&id=Item%201A.%20Risk%20Factors) This section refers to the risk factors previously discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2024, stating that there have been no material changes - Risk factors describing major risks to the business are found in **Item 1A, 'Risk Factors'**, of the Annual Report on Form 10-K for the year ended **December 31, 2024**[114](index=114&type=chunk) - **There has been no material change** in risk factors from those previously discussed in the Annual Report on Form 10-K[114](index=114&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=26&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the six months ended June 30, 2025, the company granted 30,000 options to a new employee, exempt from registration requirements under Rule 4(a)(2) and/or Rule 506 of Regulation D - During the six months ended **June 30, 2025**, the Company granted **30,000 options** to a new employee at an exercise price of **$5.89 per share**[115](index=115&type=chunk) - The issuance of these securities is **exempt from registration requirements** under **Rule 4(a)(2)** of the Securities Act of 1933, as amended, and/or **Rule 506** as promulgated under Regulation D[115](index=115&type=chunk) [Item 3. Defaults Upon Senior Securities](index=26&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there are no defaults upon senior securities to report - **There are no defaults upon senior securities to report**[115](index=115&type=chunk) [Item 4. Mine Safety Disclosures](index=26&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - This item is **not applicable** to the Company's operations[116](index=116&type=chunk) [Item 5. Other Information](index=26&type=section&id=Item%205.%20Other%20Information) This section states that no director or officer adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the six months ended June 30, 2025 - **No director or officer** of the Company adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the six months ended **June 30, 2025**[117](index=117&type=chunk) [Item 6. Exhibits](index=27&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including corporate documents, agreements, and certifications, with references to previous filings where applicable - The report includes a **comprehensive list of exhibits**, such as the Amended & Restated Certificate of Incorporation, Bylaws, various agreements (e.g., Securities Purchase Agreements, Engagement Agreements), and certifications (e.g., CEO/CFO certifications)[118](index=118&type=chunk) - Many exhibits are **incorporated by reference** from previous Form 8-K, 10-Q, and 10-K filings with the SEC[119](index=119&type=chunk)[121](index=121&type=chunk)

Core Insights - authID reported its highest quarterly revenue in the company's history for Q2 2025, achieving $1.4 million, a significant increase from $0.3 million in Q2 2024, indicating successful execution of growth strategies [3][5] - The company launched IDX, enhancing its market reach and total addressable market, alongside other product enhancements and a strong sales pipeline, positioning it for continued growth [3][7] Financial Performance - Total revenue for Q2 2025 was $1.4 million, compared to $0.3 million in Q2 2024, marking a 367% increase [5] - For the first half of 2025, total revenue reached $1.7 million, up from $0.4 million in the same period last year [5] - Operating expenses for Q2 2025 were $5.9 million, an increase from $3.6 million in Q2 2024, primarily due to increased headcount and investments in sales and R&D [6] - The net loss for Q2 2025 was $4.5 million, or $0.33 per share, compared to a loss of $3.3 million, or $0.34 per share in Q2 2024 [9][10] - Adjusted EBITDA loss for Q2 2025 was $3.4 million, compared to a loss of $2.5 million in Q2 2024 [11] Business Developments - The launch of IDX, in collaboration with NEC, significantly expands the company's total addressable market in the identity management sector [7] - A paid live production trial agreement was initiated with a Fortune Global 500 company in the UK, with expectations for a longer-term agreement upon completion [7] - The company signed an agreement with Prove, a major identity fraud platform, and is finalizing the launch with its first joint customer [7] - Enhanced PrivacyKeyTM was introduced with a one-to-many search capability, improving speed and accuracy for customers [7] Key Metrics - Remaining Performance Obligation (RPO) as of June 30, 2025, was $13.8 million, up from $4.2 million a year ago, indicating strong future revenue recognition potential [12] - Booked Annual Recurring Revenue (bARR) for Q2 2025 was $2.2 million, a significant increase from $0.6 million in Q2 2024 [13] - The net amount of bARR for the first half of 2025 was $1.8 million, compared to $0.73 million in the same period last year [14] - Annual Recurring Revenue (ARR) as of June 30, 2025, was $5.8 million, up from $1.1 million a year ago [15]