Core Viewpoint - Evolv Technologies Holdings, Inc. (EVLV) has received a Zacks Rank 1 (Strong Buy) upgrade due to an upward trend in earnings estimates, indicating a positive outlook for the company's stock price [1][4]. Earnings Estimates and Ratings - The Zacks rating system is primarily driven by changes in a company's earnings picture, with the Zacks Consensus Estimate reflecting EPS estimates from sell-side analysts [2][3]. - The recent upgrade for Evolv Technologies signifies an improvement in its earnings outlook, which is expected to lead to increased buying pressure and a rise in stock price [4][6]. Impact of Earnings Estimate Revisions - There is a strong correlation between earnings estimate revisions and near-term stock price movements, making it beneficial for investors to track these revisions [7]. - The Zacks Rank system effectively utilizes earnings estimate revisions to classify stocks, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [8]. Specifics on Evolv Technologies - For the fiscal year ending December 2025, Evolv Technologies is projected to earn -$0.23 per share, with no year-over-year change expected [9]. - Over the past three months, the Zacks Consensus Estimate for Evolv Technologies has increased by 14.8%, indicating a positive trend in earnings estimates [9]. Zacks Rating System Overview - The Zacks rating system maintains a balanced distribution of "buy" and "sell" ratings across its universe of over 4,000 stocks, with only the top 5% receiving a "Strong Buy" rating [10][11]. - The upgrade of Evolv Technologies to a Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [11].

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Company Overview - Evolv Technologies Holdings, Inc. (EVLV) shares increased by 5.8% to $6.06 in the last trading session, with a higher-than-average trading volume [1] - The stock has shown a 0.4% gain over the past four weeks [1] - Evolv Technologies is experiencing strong customer expansions and increased adoption of subscription models, along with early traction of its new product, Evolv eXpedite [1] Financial Expectations - The company is projected to report a quarterly loss of $0.09 per share, reflecting a year-over-year change of -550% [2] - Expected revenues are $29.25 million, which is a 14.5% increase from the same quarter last year [2] - Trends in earnings estimate revisions are correlated with near-term stock price movements, indicating potential strength in the stock [2][3] Stock Performance and Rankings - The consensus EPS estimate for Evolv Technologies has remained unchanged over the last 30 days, suggesting that the stock's price movement may not sustain without earnings estimate revisions [3] - The stock currently holds a Zacks Rank of 2 (Buy) [3] - Evolv Technologies is part of the Zacks Computers - IT Services industry, which includes Stem, Inc. (STEM), another stock in the same sector that closed 1679.1% higher at $7.44 [3]

Core Viewpoint - Evolv Technologies Holdings, Inc. (EVLV) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Revisions - The Zacks rating system is primarily based on a company's changing earnings picture, tracking the Zacks Consensus Estimate for EPS from sell-side analysts [2]. - The recent upgrade reflects a positive outlook on Evolv Technologies' earnings, which could lead to increased buying pressure and a rise in stock price [4][6]. - Evolv Technologies is projected to earn -$0.23 per share for the fiscal year ending December 2025, indicating a year-over-year change of 32.4% [9]. - Over the past three months, the Zacks Consensus Estimate for Evolv Technologies has increased by 14.8% [9]. Impact of Institutional Investors - Changes in a company's future earnings potential, as shown by earnings estimate revisions, are strongly correlated with near-term stock price movements, largely due to institutional investors adjusting their valuations based on these estimates [5]. - Institutional investors' transactions, driven by changes in earnings estimates, can lead to significant price movements in the stock [5]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [8]. - The upgrade of Evolv Technologies to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [11].

Core Viewpoint - Evolv Technologies Holdings, Inc. (EVLV) has shown a significant price increase of 30% over the past four weeks, with a mean price target of $7.06 indicating a potential upside of 29.3% from the current price of $5.46 [1] Price Targets and Analyst Estimates - The mean estimate consists of four short-term price targets with a standard deviation of $1.16, where the lowest estimate is $5.50 (0.7% increase) and the highest is $8.25 (51.1% increase) [2] - A low standard deviation suggests a strong agreement among analysts regarding the stock's price movement, which can serve as a starting point for further research [9] Earnings Estimates and Analyst Agreement - There is a growing optimism among analysts about EVLV's earnings prospects, as indicated by a positive trend in earnings estimate revisions, which correlates with potential stock price increases [11] - The Zacks Consensus Estimate for the current year has risen by 23.3% over the past month, with no negative revisions reported [12] Zacks Rank and Investment Potential - EVLV holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates, indicating strong potential for upside in the near term [13]

Group 1 - Evolv Technologies Holdings Inc. is positioned for long-term growth due to its AI-driven security screening solutions and increasing adoption in various verticals [1] - The company offers Security-as-a-Service solutions that are gaining traction in the market [1] - The analyst emphasizes the importance of combining financial data with qualitative analysis to evaluate companies and sectors, particularly in technology, infrastructure, and internet services [1] Group 2 - The analyst holds certifications in financial modeling and data analysis, indicating a strong foundation for evaluating investment opportunities [1] - The focus remains on providing value to readers and investors interested in long-term investing strategies [1]

Evolv (EVLV) Q1 2025 Earnings Call May 20, 2025 04:30 PM ET Company Participants Brian Norris - Senior Vice President of Finance & Investor RelationsJohn Kedzierski - CEO, President & DirectorChris Kutsor - CFOBrett Knoblauch - Managing Director Conference Call Participants Jeremy Hamblin - Senior Research AnalystMike Latimore - Managing Director & Senior Research AnalystEric Martinuzzi - Senior Research Analyst Operator Good afternoon, and welcome to the Evolve Technology First Quarter Earnings Results Con ...

Financial Data and Key Metrics Changes - Revenue in Q1 2025 was $32 million, up 10% sequentially and 44% year over year, reflecting new customer acquisition and strong expansion from the installed customer base [21][43] - Annual recurring revenue (ARR) grew 34% year over year to $106 million at the end of Q1 2025 [22][44] - Adjusted EBITDA for Q1 2025 increased to $1.7 million, with an adjusted EBITDA margin of 5% [22][47] Business Line Data and Key Metrics Changes - The company welcomed over 50 new customers in Q1 2025, serving approximately 950 customers across key end markets [21] - Sales and marketing spend as a percentage of revenue is improving, indicating more effective execution by the sales team [24] - The new certified pre-owned program aims to recapture value from returning units, contributing positively to revenue and cash flow [25][26] Market Data and Key Metrics Changes - Evolve Express is deployed in 20 of the 100 largest US school districts, screening over 850,000 students and visitors daily [30] - In healthcare, the installed base has reached 500 hospital buildings, with daily visitor screenings nearly doubling year over year [31] - The company is monitoring new legislation in California mandating weapons detection systems in hospitals, indicating potential market growth [32] Company Strategy and Development Direction - The company aims to leverage its subscription model to drive predictable long-term revenue growth, with 78% of the 2025 revenue plan already contracted [75] - The focus is on expanding the subscription base and enhancing customer engagement across various verticals, including education and healthcare [76] - The company is optimistic about the long-term potential of its AI-powered weapons detection technology, with plans to increase market penetration significantly [38] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges faced over the past year but expresses confidence in the company's ability to emerge stronger and more resilient [18][20] - The outlook for 2025 includes expected revenue growth of 20% to 25%, with a focus on achieving positive adjusted EBITDA and cash flow [40][54] - The company is committed to maintaining operational efficiency while investing in back-office improvements to support growth [54] Other Important Information - The company has resolved an FTC inquiry and completed a restatement that shifted $3.1 million in revenue to future periods [17] - The balance sheet shows $35 million in cash and equivalents, down from $52 million at the end of Q4 2024, primarily due to one-time cash disbursements [49] Q&A Session Summary Question: Success with expansions and vertical contributions - Management noted that 50% of new subscriptions came from expansions, with specific vertical contributions to be followed up later [60] Question: Impact of new California law on hospital security - Management confirmed engagement with customers in California regarding the new legislation, viewing it as a significant opportunity [63] Question: CapEx expectations for the year - Management indicated a CapEx range of $20 to $25 million to support the subscription business [68] Question: Strategy refinements and potential acquisitions - The focus remains on driving the subscription model, with 78% of the revenue outlook already contracted [75] Question: Revenue progression expectations for 2025 - Management expects to deploy at least as many units in 2025 as in 2024, with a focus on subscription growth [84] Question: Purchase versus subscription model mix - Management confirmed a preference for pure subscription models, while still offering purchase options [92] Question: New customers for Expedite product - The 12 new customers for Expedite included both existing customers and new clients, indicating strong early traction [95]

Financial Performance - Evolv generated revenue of $32.0 million for the three months ended March 31, 2025, compared to $22.2 million for the same period in 2024, representing a year-over-year increase of 44%[158]. - The company reported a net loss of $1.7 million for the three months ended March 31, 2025, significantly improved from a net loss of $11.3 million in the same period of 2024[158]. - Total revenue for the three months ended March 31, 2025, was $32,007,000, representing a 44% increase from $22,181,000 in the same period of 2024[185]. - Subscription revenue increased by 35% to $19,237,000 in Q1 2025, up from $14,219,000 in Q1 2024[188]. - The net loss for the three months ended March 31, 2025, was $1,689,000, an 85% improvement from a net loss of $11,272,000 in the same period of 2024[185]. - Cash used in operating activities decreased from $16.2 million in Q1 2024 to $2.5 million in Q1 2025, indicating improved cash flow management[210]. - The company expects to continue generating losses for the foreseeable future, necessitating careful investment and potential additional capital[202]. Revenue Streams and Customer Growth - Evolv's solutions are primarily offered under a multi-year subscription model, which provides predictable revenue streams and is increasingly being adopted by customers[150]. - The company added 54 new customers during the three months ended March 31, 2025, contributing to revenue growth[186]. - License fee and other revenue surged by 205% to $3,718,000 in Q1 2025, compared to $1,219,000 in Q1 2024[190]. Cost Management and Expenses - Sales and marketing costs are anticipated to decrease for the year ending December 31, 2025, due to cost-cutting measures including a reduction in force implemented in January 2025[175]. - General and administrative expenses rose significantly due to legal and consulting fees, expected to continue through Q2 2025[176]. - Research and development expenses decreased by 24% to $4,862,000 in Q1 2025, down from $6,396,000 in Q1 2024[191]. - Sales and marketing expenses decreased by $4.8 million (30%) from $15.9 million in Q1 2024 to $11.0 million in Q1 2025, primarily due to reductions in personnel-related costs and advertising expenses[193]. - General and administrative expenses increased by $3.2 million (27%) from $11.8 million in Q1 2024 to $15.0 million in Q1 2025, driven by a significant rise in non-recurring professional fees[194]. - The company incurred restructuring costs of $2.7 million in Q1 2025, primarily related to a reduction in force[195]. Product and Technology - Evolv's flagship product, Evolv Express, utilizes AI-powered software to enhance security screening and improve visitor experience, distinguishing between threats and harmless items[148]. - Evolv's innovative technology aims to address the growing demand for safer environments in venues such as sports, education, and healthcare facilities[146]. Market Dynamics and Future Outlook - The company expects fluctuations in revenue and operating results due to factors such as inflation, supply chain issues, and shifts towards touchless security screening[153][154]. - The company is focused on expanding its market presence in various verticals, particularly in the United States, while adapting pricing strategies to regional dynamics[156]. - The company anticipates a decrease in general and administrative expenses in the second half of 2025 as ongoing investigations conclude[176]. Financial Position and Cash Flow - As of March 31, 2025, the company had $35.0 million in cash, cash equivalents, and marketable securities, down from a net income of $11.3 million in Q1 2024 to a net loss of $1.7 million in Q1 2025[200]. - Cash provided by financing activities was less than $0.1 million in Q1 2025, indicating limited financing activity compared to $0.3 million used in Q1 2024[216]. - Total future minimum lease payments under noncancelable operating leases amount to $19.1 million as of March 31, 2025[208]. Accounting and Reporting - No material changes to critical accounting estimates during the three months ended March 31, 2025[218]. - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures[219].

Financial Performance - Total revenue for Q4 2024 was $29.1 million, a 41% increase compared to $20.6 million in Q4 2023[6] - Annual Recurring Revenue (ARR) at the end of Q4 2024 was $99.4 million, up 39% from $71.3 million in Q4 2023[6] - Total revenue for the full year 2024 was $103.9 million, a 31% increase from $79.6 million in 2023[6] - Total revenue for the nine months ended September 30, 2024 was $74.8 million, a 27% increase compared to $59.0 million in the same period of 2023[5] - Total revenue for the twelve months ended December 31, 2024, was $74,765,000, representing a 26.7% increase from $58,985,000 in 2023[23] Profitability Metrics - Adjusted EBITDA for Q4 2024 was $0.4 million, compared to a loss of $(10.3) million in Q4 2023[6] - The company achieved positive adjusted EBITDA in Q4 2024, six months ahead of schedule[2] - Gross profit for the year ended December 31, 2024, was $59.3 million, compared to $31.9 million for the previous year, representing an 86.1% increase[17] - The total comprehensive loss for the year was $54.0 million, compared to $108.1 million in the previous year, indicating a significant reduction[18] - Adjusted gross profit for the twelve months ended December 31, 2024, reached $64,100 million, up from $34,462 million in 2023, reflecting an 85.8% year-over-year growth[33] Net Loss and Earnings Per Share - Net loss for the full year 2024 was $(54.0) million, or $(0.34) per share, compared to $(108.0) million, or $(0.72) per share in 2023[6] - The net loss for Q4 2024 was $15.7 million, a slight improvement from a net loss of $17.2 million in Q4 2023[17] - Net loss for the twelve months ended December 31, 2024, was $54.02 million, improved from $108.05 million in the previous year[37] - Adjusted loss per share for Q4 2024 was $0.03, compared to $0.08 in Q4 2023, indicating a reduction in losses[37] Cash and Liquidity - As of December 31, 2024, the company had cash and cash equivalents of $51.9 million and no debt[6] - Cash and cash equivalents decreased to $37,015,000 at the end of 2024 from $67,162,000 at the end of 2023, reflecting a decrease of 44.7%[22] - Cash flows from operating activities showed a net cash used of $34,057 million for the nine months ended September 30, 2024, compared to $6,658 million for the same period in 2023[27] Expenses - Research and development expenses for the year totaled $23.4 million, a decrease from $24.5 million in the previous year[17] - Sales and marketing expenses increased to $61.3 million for the year, compared to $55.0 million in 2023, reflecting a 9.4% rise[17] - One-time employee separation costs for the three months ended December 31, 2024, amounted to $2,060 million, compared to $262 million in the same period of 2023[34] - Stock-based compensation for the twelve months ended December 31, 2024, totaled $24,756 million, slightly increasing from $24,129 million in 2023[36] Customer Metrics - The company reported a total of 60 new customers in Q3 2024, compared to 52 in Q2 2024, indicating a growth in customer acquisition[29] - Total net units shipped rose from 375 in Q1 2024 to 468 in Q3 2024, indicating an increase of 24.8%[29] Future Outlook - The company plans to continue focusing on cost management and operational efficiency to improve future performance[37]