Group 1 - BIO-key International, Inc. will host its first quarter 2025 investor call on May 16th at 10 a.m. ET, with results released after market close on May 15th [1] - The conference call will be led by Mike DePasquale, Chairman & CEO, and Cecilia Welch, CFO, and will include a Q&A session [1] - The company specializes in Identity and Access Management solutions, focusing on biometric capabilities for secure access [3] Group 2 - BIO-key's IAM software secures access for over 40 million users, offering various authentication options including phoneless, tokenless, and passwordless methods [3] - The PortalGuard IAM solution is available both as a hosted and on-premise option, providing cost-effective and secure access to critical information and applications [3]

Customer Base and Market Expansion - As of December 31, 2024, BIO-key has over 600 customers across multiple industries using its identity and access management solutions [19]. - The acquisition of PistolStar on June 30, 2020, expanded BIO-key's customer base in the state and local government and higher education sectors [22]. - The company expanded its operations into Europe, Africa, and the Middle East by acquiring Swivel Secure Europe, serving over 300 customers in the region [23]. - The collaboration with Fiber Food Systems, Inc. aims to explore identity access management use cases in the food industry, potentially creating new commercial opportunities [24]. - The PortalGuard IAM product line has hundreds of active customers and is being enhanced with additional capabilities [62]. - The company has partnered with over 85 resellers and distribution partners to expand its market reach [43]. Technology and Product Offerings - BIO-key's PortalGuard IDaaS provides 17 multi-factor authentication options, including biometric methods like fingerprint and facial recognition [27]. - BIO-key's biometric technology is utilized in large-scale identity projects, including government ID initiatives and healthcare organizations [39]. - The company is a Microsoft Partner, with its fingerprint scanners qualified to support Windows Hello and Windows Hello for Business [40]. - BIO-key's WEB-key platform supports over 30 fingerprint scanners interchangeably, enhancing its scalability for government agencies [16]. - The company’s biometric authentication process addresses gaps in existing IAM technology, particularly in user authentication and account sharing [41]. - The company’s intellectual property includes numerous patents related to biometric technology, with some expiring between 2025 and 2039 [47][48][52][57]. - The company is actively involved in industry privacy workgroups to influence biometric privacy regulations and ensure compliance [71]. Financial Performance and Challenges - The company generated approximately $7.0 million in revenue during 2024, which is below the average monthly requirement of $812,000 [84]. - The company has a history of significant losses and negative cash flow, raising substantial doubt about its ability to continue as a going concern [81]. - Total revenue decreased by $825,334 or 11% to $6,929,571 in 2024 compared to $7,754,905 in 2023, primarily due to the exit from the distribution agreement with Swivel Secure Limited [169]. - License revenue increased by $847,360 or 20% to $5,189,370 in 2024, driven by expansions from several long-term customers and new deployments [171]. - Service revenue decreased by 50% to $1,108,506 in 2024, with recurring service revenue down 15% due to the loss of a large customer service agreement [168][170]. - Hardware sales dropped by $562,315 or 47% to $631,695 in 2024, largely due to a lack of repeat sales to an international defense agency [171]. - Net loss improved to $(4,300,692) in 2024 from $(8,521,837) in 2023, reflecting increased gross profit and lower operating expenses [179]. - Monthly operational cash requirement is approximately $812,000, which was not consistently met through revenue generation [192]. Operational Risks and Regulatory Challenges - The company has identified a material weakness in internal control over financial reporting, leading to a restatement of financial statements for 2023 [78]. - The company faces intense competition from both established biometric companies and startups, which may hinder its ability to keep pace with technological changes [93]. - The company is subject to multiple regulatory challenges, including privacy, security, and data use regulations, which could adversely affect its operations [105]. - Cybersecurity threats, including ransomware and sophisticated attacks, pose significant risks to the integrity of the company's systems and customer data [106]. - Compliance with evolving privacy and data protection laws is critical, as failures could lead to significant liabilities and loss of customer trust [110]. - The company faces risks in international expansion due to potential challenges in protecting its intellectual property rights globally [102]. Strategic Direction and Future Outlook - The company aims to pursue strategic acquisitions in the IAM space to support growth and enhance earnings [42]. - The company plans to expand its role in the IAM market and continue offering a suite of authentication options to enhance customer experience [160]. - Strategic acquisitions in the IAM space are being pursued to enter new market verticals and synergize with existing operations [163]. - The company expects increased demand for security solutions in government services and highly-regulated industries, driven by heightened security and privacy requirements [161]. Governance and Leadership - Michael W. DePasquale has been the CEO since January 3, 2003, and has over 30 years of executive management experience in the technology sector [211]. - Cecilia C. Welch serves as the Chief Financial Officer, indicating a strong financial leadership within the company [210]. - The company has a diverse board of directors with extensive experience in various industries, enhancing its strategic decision-making capabilities [210]. - The board includes members with backgrounds in software, professional services, and biometric industries, which aligns with the company's focus [211]. - The company is actively involved in the International Biometrics and Identification Industry Association, reflecting its commitment to industry standards and innovation [211].

Core Insights - BIO-key International, Inc. has announced a strategic partnership with Arrow ECS Iberia to enhance the availability of its Identity and Access Management (IAM) solutions in Spain and Portugal [1][2][8] - The partnership aims to address the increasing demand for regulatory-compliant security solutions in the Iberian market, focusing on phoneless, tokenless, and passwordless authentication [2][7] - The partnership will be officially presented at the Arrow ECS Event on April 2, 2025, in Lisbon, where BIO-key will showcase its advanced IAM solutions to over 800 partners and cybersecurity experts [3][4] Company Overview - BIO-key specializes in biometric-centric, multi-factor IAM software, securing access for over 40 million users [11] - The company offers a range of authentication options, including Multi-factor Authentication (MFA), Single Sign-On (SSO), and Identity-Bound Biometrics (IBB) [9][11] - BIO-key's solutions are designed to be cost-effective, easy to deploy, and compliant with European regulations such as NIS2 and GDPR [4][9] Partnership Details - Arrow ECS Iberia will support the adoption of BIO-key's IAM solutions through its extensive reseller network and market knowledge [6][8] - The partnership is expected to enhance security for enterprises in key industries, including financial services, healthcare, and public sector [7][8] - Arrow ECS Iberia is recognized as a leader in IT security distribution, making it an ideal partner for BIO-key in the region [8]

Financial Data and Key Metrics Changes - The company reported a revenue decline of 11% to $6.9 million in 2024, primarily due to the exit from a low-margin service agreement [10][25] - High-margin software license fee revenue increased by 20% to $5.2 million in 2024, contributing to an adjusted gross margin of 78%, up from 64% in 2023 [10][30] - Operating expenses were reduced by 6% to $9.7 million in 2024, leading to a net loss improvement to $4.3 million or $2.85 per share, compared to a net loss of $8.5 million or $21.21 per share in 2023 [11][30] Business Line Data and Key Metrics Changes - License fee revenue in Q4 2024 increased by 77% to $1 million, while lower-margin services revenue decreased by 28% to $344,000 [27] - Hardware revenue declined significantly by 88% to $94,000 in Q4 2024, reflecting a lack of large expansion orders compared to the previous year [27][30] Market Data and Key Metrics Changes - The company is seeing increased demand for its passwordless, phoneless, and tokenless authentication solutions, particularly in the Middle East and Asia [14][20] - A notable contract was secured with a foreign financial services client worth $910,000, enhancing the company's presence in the financial sector [15] Company Strategy and Development Direction - The company has exited low-margin software and services relationships to focus on core solutions like PortalGuard IAM and identity-bound biometrics, which offer higher gross margins [9][10] - There is a strategic focus on expanding into emerging markets, including IoT solutions and partnerships with innovative technology developers [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2025, citing encouraging order activity and customer interest in their solutions [12][20] - The company anticipates a return to growth and improved profitability in 2025, with a focus on managing operating costs and investing in R&D [23][49] Other Important Information - The company reduced its outstanding debt to approximately $730,000 from $1.5 million at the end of 2024, strengthening its financial position [7] - The company launched PortalGuard IDAS on the AWS marketplace, enhancing its subscription-based business model [22] Q&A Session Summary Question: Clarification on 10-K filing and restatements - The company confirmed that the 10-K is expected to be filed on Monday and that there are no new restatements beyond those previously disclosed [34][35] Question: Changes in revenue expectations for 2024 - Management explained that the exit from the Swivel Secure business resulted in a revenue delta of about $800,000 to $900,000 for the full fiscal year, impacting overall revenue expectations [39][41] Question: Outlook for hardware and services revenue - Management indicated that growth is expected in both hardware and services revenue in 2025, with hardware sales becoming more integrated into contracts [55] Question: Details on the $910,000 contract - A significant portion of the $910,000 contract will be recognized in Q1 2025, with about $250,000 recognized in Q4 2024 [57] Question: Update on Nigerian ID plans - Management noted ongoing discussions with the World Bank regarding ID plans in Nigeria, with potential for future sales of hardware [68][72]

BIO-key International, Inc. (NASDAQ:BKYI) Q4 2024 Earnings Conference Call March 27, 2025 10:00 AM ET Company Participants William Jones - IR Michael DePasquale - Chairman and CEO Cecilia Welch - CFO Conference Call Participants Jack Vander Aarde - Maxim Group Operator Good morning, everyone. Thank you for standing by. And welcome to BIO-key International's 2024 Fourth Quarter Conference Call. Afterwards, listeners will be invited to participate in a question and answer session. As a reminder, this conferen ...

Revenue Performance - BIO-key's 2024 revenues decreased approximately 11% to $6.9M from $7.8M in 2023, primarily due to the exit from a low-margin services relationship with Swivel Secure[12] - License fee revenue increased 20% to $5.2M in 2024 compared to $4.3M in 2023, while service fees declined 50% to $1.1M[12] - Total revenues for Q4 2024 were $1,462,278, a decrease of 19.9% compared to $1,825,101 in Q4 2023[23] - License fees increased significantly to $1,023,701 in Q4 2024, up 77.1% from $577,669 in Q4 2023[23] Profitability and Loss - BIO-key's net loss improved to $4.3M, or ($2.10) per share, in 2024, compared to a net loss of $8.7M, or ($15.21) per share, in 2023[16] - The gross profit grew to $5.6M in 2024 from $1.4M in 2023, benefiting from higher-margin license sales and a reduction in lower-margin services[14] - Operating loss narrowed to $1,427,310 in Q4 2024 from $2,723,834 in Q4 2023, indicating better cost management[23] - The company reported a net loss of $4,323,690 for the year ended December 31, 2024, an improvement from a net loss of $8,521,837 in 2023[23] - Basic and diluted loss per common share improved to $2.10 in 2024 from $15.21 in 2023, reflecting reduced losses[23] Expenses and Cost Management - Operating expenses were reduced by $606,409 to $9.7M in 2024 from $10.3M in 2023, with SG&A costs decreasing by $722,563[15] - The company experienced a net cash used for operating activities of $2,914,072 in 2024, compared to $3,793,456 in 2023, showing improved cash flow management[31] Assets and Equity - Cash and cash equivalents at the end of 2024 were $437,604, down from $511,400 at the end of 2023[27] - Total assets increased to $8,615,560 in 2024, compared to $4,517,035 in 2023, reflecting growth in the company's asset base[27] - Total stockholders' equity increased to $3,749,033 in 2024 from $1,063,565 in 2023, indicating a stronger financial position[28] Strategic Partnerships and Market Presence - The company secured a $910K contract with a financial services client to implement biometric identification technology, with over 25M end-users enrolled[6] - BIO-key partnered with California Ed Tech JPA to provide solutions to 195 member institutions serving over 2.6M students[5] - The company has established a presence in education across over 100 institutions serving over 4M end users, with recent migrations to PortalGuard IDaaS[9] - A strategic collaboration with Fiber Food Systems was announced to explore IAM use cases across the food industry, alongside an equity exchange with Boumarang, Inc.[10] Future Outlook - BIO-key is optimistic about 2025, citing increasing interest in biometric solutions and a focus on higher-margin offerings[11]

Core Insights - BIO-key International, Inc. reported a strategic transition in 2024, focusing on high-margin software license fee revenue, which increased by 20%, while overall revenue decreased by 11% due to exiting low-margin services [2][12][16] - The company is optimistic about future growth, driven by increasing demand for its passwordless, phoneless, and tokenless biometric solutions across various sectors, including national defense, financial services, and education [4][11] Financial Performance - Total revenues for 2024 decreased to $6.9 million from $7.8 million in 2023, with license fee revenue rising to $5.2 million, a 20% increase from $4.3 million in 2023 [12][16] - Operating expenses were reduced by 6% to $9.7 million in 2024, contributing to an improved net loss of $4.3 million, compared to a net loss of $8.7 million in 2023 [15][16] - Gross profit increased significantly to $5.6 million in 2024 from $1.4 million in 2023, reflecting the shift to higher-margin products [14][16] Strategic Developments - BIO-key secured a $910,000 contract with a financial services client to implement biometric identification technology, enhancing customer interaction efficiency [5] - The company expanded its partnership with the National Bank of Egypt to integrate its PortalGuard IAM platform, securing digital identities for 30,000 employees [7] - A strategic collaboration with Fiber Food Systems was announced to explore IAM use cases in the food industry, indicating diversification into new markets [10] Market Positioning - BIO-key has established a growing presence in the education sector, serving over 4 million end users across more than 100 institutions [9] - The company is experiencing strong order demand in EMEA countries, indicating a robust international market presence [4] - The transition to focus on proprietary solutions is expected to enhance profitability and market competitiveness [2][11]

Core Insights - BIO-key International, Inc. has successfully deployed a comprehensive suite of biometric-based Identity and Access Management (IAM) solutions for a new International Defense Agency customer, completing the initial deployment in just four days, highlighting efficiency and collaboration [1][3] Company Overview - BIO-key is a leader in IAM and biometric authentication solutions, securing access for over 40 million users and offering diverse authentication factors including phoneless, tokenless, and passwordless options [4] Solution Features - The deployment includes PortalGuard On-Prem, WEB-key biometric software, FIPS-certified fingerprint scanners, and Passkey:YOU FIDO2 authentication, demonstrating high-security, passwordless, and phoneless authentication capabilities [2][7] Management Commentary - The International Managing Director emphasized the innovative thinking and strong partnerships that contributed to the rapid deployment, which enhances security while simplifying access for the customer [3] - The Technical Manager noted that completing such a large-scale project in four days showcases the seamless integration capabilities of BIO-key's IAM solutions [3]

Company Overview - BIO-key International, Inc. is an innovative provider of Identity and Access Management and Identity-Bound Biometric solutions, securing access for over forty million users [3]. Upcoming Events - The company will host its Q4 2024 investor call on Thursday, March 27th at 10 a.m. ET, with results released before the market opens on the same day [1]. - The conference call will be led by Mike DePasquale, Chairman & CEO, and Cecilia Welch, CFO [1]. Conference Call Details - Call Dial In Numbers: 1-877-418-5460 (U.S.) or 1-412-717-9594 (International) [2]. - Live Webcast and Replay will be available for 3 months [2]. - Audio Replay Numbers: 1-877-344-7529 (U.S.) or 1-412-317-0088 (International); code 6747311 [2]. Product Offering - BIO-key offers a multi-factor identity and access management (IAM) software that includes phoneless, tokenless, and passwordless biometric options, providing cost-effective and secure access to computers, information, applications, and high-value transactions [3].

Company Overview - BIO-key International, Inc. is an innovative provider of Identity and Access Management and Identity-Bound Biometric solutions, securing access for over forty million users [3]. Upcoming Events - The company will host its Q4 2024 investor call on Thursday, March 27th at 10 a.m. ET, with results released before the market opens on the same day [1]. - The conference call will be led by Mike DePasquale, Chairman & CEO, and Cecilia Welch, CFO [1]. Conference Call Details - Call Dial In Numbers: 1-877-418-5460 for U.S. and 1-412-717-9594 for International [2]. - A live webcast and replay will be available for three months [2]. - Audio replay can be accessed at 1-877-344-7529 for U.S. and 1-412-317-0088 for International, using code 6747311 [2].