Core Insights - Mitek Systems has launched Check Fraud Defender, an AI cloud platform designed for real-time inspection of check forgery [1] - The company's significant value lies in its consortium, which encompasses over 50% of U.S. checking banks [1] Company Overview - Mitek Systems specializes in technology solutions for mobile capture and identity verification [1] - The introduction of Check Fraud Defender positions the company as a leader in combating check fraud through advanced AI technology [1] Market Position - The consortium's coverage of more than 50% of U.S. checking banks indicates a strong market presence and potential for widespread adoption of its solutions [1]

Group 1 - Mitek Systems launched its Check Fraud Defender, an AI cloud platform for real-time check forgery inspection [1] - The company's significant value lies in its consortium, which encompasses over 50% of U.S. checking banks [1]

Industry Overview - The tech sector has experienced a significant bifurcation, with software stocks suffering substantial declines, particularly large-cap companies like Salesforce, Intuit, and Adobe, which are down over 50% from their all-time highs due to AI disruption [1] - Despite the overall downturn, some software firms are showing strong momentum and could benefit from a sector recovery [2] Software Stocks Analysis - Five software stocks with an 80 or higher rating on Benzinga Edge's Momentum Score and bullish technical signals are highlighted for potential investment [3] Individual Stock Highlights - **Teradata Corp.** - Momentum Score: 84.57 - Strategies include day trading for Q1 and swing trading for Q2 [4] - **Arteris Inc.** - Momentum Score: 93.54 - The company reported an earnings surprise, leading to a breakout above the 50-day SMA, supported by a bullish MACD cross, indicating potential for further upside [4] - **Clear Secure Inc.** - Momentum Score: 91.75 - Positive market response to optimistic guidance, with a bullish crossover on the MACD prior to the earnings report, suggesting strong future momentum [5] - **Core Scientific Inc.** - Momentum Score: 87.32 - The stock price is consolidating with potential for a breakout, supported by the 50-day SMA, and has room for upside before reaching oversold status [6] - **Mitek Systems Inc.** - Momentum Score: 88.31 - The stock has increased over 35% year-to-date, with a breakout confirmed by MACD prior to earnings, indicating potential for further gains [7][8]

Core Insights - Mitek Systems has announced enhancements to its digital onboarding capabilities for the Spanish market, focusing on compliance with SEPBLAC regulations to combat AI-driven identity fraud [1] Company Developments - The enhancements specifically strengthen Mitek's unassisted video verification solution, which is utilized across Spain for remote identity verification that meets SEPBLAC standards [1]

Core Insights - Mitek Systems reported a strong fiscal first quarter with total revenue of $44.2 million, a 19% increase year-over-year, driven by growth in fraud and identity services and stability in Check Verification [1][4][7] Financial Performance - Fraud and identity revenue reached $25.5 million, up 30% year-over-year, while Check Verification revenue was $18.8 million, up 6% [1][4] - Adjusted EBITDA was $13.3 million, representing a 30% margin and a 69% increase year-over-year, with adjusted EPS of $0.26, reflecting approximately 80% growth [7] - Non-GAAP gross margin was 82%, down about 280 basis points year-over-year, primarily due to costs associated with early-stage Check Fraud Defender pilot deployments [8] Competitive Positioning - The company believes it is well-positioned in the competitive landscape due to its broad platform capabilities, including biometrics and deepfake detection, which enhance its service offerings [2] - Generative AI is driving an increase in synthetic fraud, leading customers to seek Mitek's unified platform for continuous fraud detection and identity verification [3][6] Business Segments - Check Verification remains stable with an annual run rate of approximately 1.2 billion Mobile Deposit transactions and last twelve months revenue of about $91 million [11] - The Check Fraud Defender product saw annualized contract value reach approximately $17 million, up 44% year-over-year, with consortium datasets covering over 50% of U.S. checking accounts [13] Guidance and Outlook - Mitek raised its fiscal 2026 revenue guidance to a range of $187 million to $197 million, reflecting improved visibility in Check Verification renewals and stronger momentum in fraud and identity services [15] - For the fiscal second quarter, the company expects revenue between $50 million and $55 million, influenced by the timing of Check Verification license renewals [16] Capital Management - The company retired $155 million in convertible notes and ended the quarter with a net cash position of approximately $33 million after drawing $50 million on a term loan [5][13] - Mitek repurchased about $17 million of shares and announced a new $50 million share repurchase authorization [4][14]

Core Insights - Mitek Systems reported a revenue of $44.24 million for the quarter ended December 2025, marking an 18.8% year-over-year increase and exceeding the Zacks Consensus Estimate of $42.25 million by 4.72% [1] - The company achieved an EPS of $0.26, up from $0.15 a year ago, resulting in a surprise of 33.33% compared to the consensus estimate of $0.20 [1] Revenue Breakdown - Software license revenue was $13.9 million, surpassing the estimated $13.04 million, reflecting a 16% increase year-over-year [4] - SaaS, maintenance, and other revenue reached $30.34 million, exceeding the estimated $29.21 million, with a year-over-year growth of 20.1% [4] Profitability Metrics - Non-GAAP gross profit for SaaS, maintenance, and other was $22.28 million, slightly above the average estimate of $22.27 million [4] - Non-GAAP gross profit for software license was $13.87 million, compared to the average estimate of $12.93 million [4] Stock Performance - Mitek Systems' shares have returned -6.9% over the past month, contrasting with the Zacks S&P 500 composite's +0.5% change [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance against the broader market in the near term [3]

Financial Data and Key Metrics Changes - Total revenue for the first quarter of fiscal 2026 was $44.2 million, up 19% year-over-year, driven by a 30% growth in fraud and identity revenue and a 21% growth in SaaS revenue [18][19] - Adjusted EBITDA was $13.3 million, up 69% year-over-year, representing a margin of 30% [18][24] - Non-GAAP gross margin was 82%, a decline of approximately 280 basis points year-over-year due to early-stage Check Fraud Defender pilot deployments and SaaS delivery economics [21][24] - Free cash flow for the quarter was $6.6 million, with a 102% conversion of LTM Adjusted EBITDA compared to 83% last year [25] Business Line Data and Key Metrics Changes - Fraud and identity revenue was $25.5 million, up 30% year-over-year, driven by SaaS growth led by MiVIP and Check Fraud Defender [19] - Check Verification revenue for the quarter was $18.8 million, up 6% year-over-year, with annual transaction volumes remaining stable at approximately 1.2 billion [19][20] Market Data and Key Metrics Changes - In North America, performance was driven by large enterprise renewals and targeted expansions, including a new platform entry point at a top five financial institution [10] - In EMEA, progress was made migrating legacy customers onto MiVIP in Spain, supporting expansion across various industries beyond core banking [10] Company Strategy and Development Direction - The company is executing its "Unify and Grow" ethos, focusing on fortifying Check Verification, unifying fraud and identity portfolios, investing in innovation, and maintaining disciplined capital allocation [5][14][15] - The strategy includes combining various verification methods into a single platform experience to address the growing sophistication of fraud [8][9] Management's Comments on Operating Environment and Future Outlook - Management noted that generative AI is accelerating synthetic fraud globally, increasing demand for the company's solutions [4] - The company raised its fiscal 2026 revenue guidance range to $187 million-$197 million, reflecting strong first-quarter execution and improved visibility into customer expansion [28][29] Other Important Information - The company announced a new $50 million share repurchase program following the retirement of its $155 million convertible senior notes [5][27] - The annualized contract value across Check Fraud Defender now stands at approximately $17 million, up 44% year-over-year [11] Q&A Session Summary Question: Can you discuss the competitive environment for the fraud and identity segment? - Management highlighted that the growing demand driven by AI and synthetic fraud is creating opportunities, and the company's broad platform and capabilities position it well in the market [33][35] Question: How are you thinking about the pricing lever for growth over the longer term? - Management indicated that pricing remains stable, with strong relationships supporting growth, particularly in fraud and identity solutions [39][40] Question: Has there been any expansion of the sales force in terms of headcount or marketing budget? - Management confirmed that headcount has expanded, and investments in sales and marketing are ongoing to support growth initiatives [47][49] Question: Can you provide more color on the Check Fraud Defender pilots? - Management reported positive progress with pilots, noting that the accumulated datasets are increasing in value as more partners join the consortium [52][54] Question: Are you seeing more urgency from financial institutions due to AI-driven fraud? - Management acknowledged that institutions experiencing attacks are moving more quickly in their sales cycles, but comprehensive solutions take time to implement [58][60]

Financial Data and Key Metrics Changes - Total revenue for Q1 2026 was $44.2 million, up 19% year-over-year, driven by strong performance across the portfolio [17] - Adjusted EBITDA increased by 69% year-over-year to $13.3 million, representing a margin of 30% [22] - Non-GAAP gross margin was 82%, a decline of approximately 280 basis points year-over-year due to early-stage pilot costs and SaaS delivery pressures [19] - Non-GAAP net income was $12.4 million, with adjusted EPS of $0.26 per diluted share, reflecting approximately 80% growth year-over-year [22] Business Line Data and Key Metrics Changes - Fraud and identity revenue grew 30% year-over-year to $25.5 million, with SaaS revenue contributing $3.6 million of this growth [18] - Check verification revenue was $18.8 million, up 6% year-over-year, with stable annual transaction volumes of approximately 1.2 billion [18][24] Market Data and Key Metrics Changes - In North America, growth was driven by large enterprise renewals and targeted expansions, including a new entry point at a top five financial institution [9] - In EMEA, progress was made in migrating legacy customers to MiVIP, supporting expansion across various industries beyond core banking [9] Company Strategy and Development Direction - The company is focused on a "unify and grow" strategy, aiming to fortify its Check Verification business and unify its fraud and identity portfolio [5][6] - Investments are being made in innovation and strengthening the core platform, with a focus on automation and model performance [11][12] - A new $50 million share repurchase program was announced, reflecting a disciplined capital allocation strategy [14][25] Management's Comments on Operating Environment and Future Outlook - Management noted that generative AI is accelerating synthetic fraud, increasing demand for the company's solutions [4] - The company raised its fiscal 2026 revenue guidance to a range of $187 million to $197 million, reflecting strong first-quarter execution and improved visibility [25][26] - The adjusted EBITDA margin guidance was updated to 29%-32%, driven by a higher level of capitalized software development [27] Other Important Information - Free cash flow for the quarter was $6.6 million, with a 102% conversion of LTM Adjusted EBITDA [23] - The company ended the quarter with $192 million in cash and investments, and a net cash position of $33 million after retiring $155 million in convertible senior notes [24] Q&A Session Summary Question: Can you discuss the competitive environment in the fraud and identity segment? - Management highlighted that the growing demand driven by AI and synthetic fraud is creating opportunities, and the company's broad platform and capabilities position it well in the market [30][31] Question: How are you thinking about the pricing lever for growth in Check Verification? - Management indicated that pricing remains stable, with strong relationships supporting growth, despite the overall decline in checks [36] Question: Has there been any expansion of the sales force or marketing budget? - Management confirmed that headcount has expanded, particularly in sales and channel partner capabilities, to meet increasing demand [44][46] Question: Can you provide updates on the Check Fraud Defender pilots? - Management reported positive progress with pilots, noting that the accumulated datasets are enhancing the value of the consortium [48][50] Question: Are you seeing more urgency from financial institutions regarding AI-driven fraud? - Management acknowledged that institutions experiencing attacks are accelerating their engagement, leading to broader adoption of the company's solutions [54][56]

NASDAQ: MITK Mitek Systems, Inc. Financial Highlights & Outlook Fiscal Q1 2026 February 2026 ©2026 Mitek Systems Inc. All rights reserved Safe Harbor Statement Forward-looking statements contained in this presentation involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially and adversely from those expressed or implied by such forward-looking statements. Forward- looking statements may include but are not limited ...

Financial Performance - Total revenue for Q1 FY2026 was $44.2 million, a 19% increase year-over-year from $37.3 million[6] - Adjusted EBITDA for Q1 FY2026 was $13.3 million, compared to $7.8 million a year ago, with an adjusted EBITDA margin of 30.0%[6] - Non-GAAP net income for Q1 FY2026 was $12.4 million, up from $6.6 million a year ago, with non-GAAP net income per diluted share of $0.26[6] - The company reported a GAAP net income of $2.8 million for Q1 FY2026, compared to a net loss of $4.6 million in the same period last year[6] - Total consolidated revenue for the three months ended December 31, 2025, was $44,244,000, representing a 18.5% increase from $37,254,000 in the prior year[27] - Adjusted EBITDA for the same period was $13,289,000, with an adjusted EBITDA margin of 30.0%, up from 21.1% in the previous year[28] - Non-GAAP net income for the three months ended December 31, 2025, was $12,434,000, compared to $6,633,000 in the prior year[30] - Net income for the three months ended December 31, 2025, was $2,772,000, a significant improvement from a net loss of $4,612,000 in the same period of 2024[25] Revenue Breakdown - Fraud and Identity revenue grew 30% year-over-year, driven by 21% growth in SaaS revenue[3] - SaaS revenue for Q1 FY2026 was $22.2 million, a 21% increase year-over-year from $18.4 million[6] - Revenue from Fraud and Identity Solutions increased to $25,470,000, up from $19,570,000 year-over-year[27] - Revenue from Check Verification Solutions increased to $18,773,000, compared to $17,685,000 in the same quarter last year[27] - Software license revenue for the three months ended December 31, 2025, was $13,901 thousand, up from $11,985 thousand in 2024, marking a 15.9% increase[37] - SaaS, maintenance, and other revenue for the three months ended December 31, 2025, was $30,343 thousand, compared to $25,269 thousand in 2024, representing a 20.4% growth[37] Cash and Investments - Total cash and investments decreased to $191.8 million as of December 31, 2025, down from $196.5 million at September 30, 2025[6] - Cash and cash equivalents at the end of the period increased to $175,122,000 from $154,153,000 at the beginning of the period[25] - Total current assets decreased to $239,102,000 as of December 31, 2025, down from $248,494,000 as of September 30, 2025[23] Liabilities and Equity - Total liabilities decreased to $212,797,000 from $218,851,000 in the previous quarter[23] - Stockholders' equity decreased to $233,656,000 from $240,258,000 in the prior quarter[23] Shareholder Actions - The company has raised its full-year revenue guidance to between $187 million and $197 million, with a midpoint year-over-year growth of approximately 7%[7] - The company authorized a new $50 million share repurchase program effective after the completion of the existing program[10] - The company repaid $155.3 million in Convertible Senior Notes in full on February 1, 2026[10] Operating Expenses - Total stock-based compensation expense for the three months ended December 31, 2025, was $2,691 thousand, down from $4,465 thousand in 2024, indicating a 39.8% decrease[35] - Non-GAAP operating expenses for the three months ended December 31, 2025, totaled $23,209 thousand, a decrease from $24,021 thousand in 2024, reflecting a 3.4% reduction[39] - General and administrative expenses for the three months ended December 31, 2025, were $11,074 thousand, compared to $11,901 thousand in 2024, showing a 6.9% decrease[39] Cash Flow - Net cash provided by operating activities for the three months ended December 31, 2025, was $13,743 thousand, compared to $7,064 thousand for the same period in 2024, representing a 94.5% increase[33] - Free cash flow for the twelve months ended December 31, 2025, was $62,793 thousand, up from $40,184 thousand in 2024, indicating a 56.5% growth[33]