Revenue Performance - Total revenue for 2024 was $17.4 million, a decrease from $18.2 million in 2023, resulting in a year-over-year decline of approximately 4.4%[105] - Software license revenue decreased by 18% from $9.5 million in 2023 to $7.8 million in 2024, representing 45% of total revenue compared to 52% in the previous year[109] - Software maintenance revenue increased by 12% from $7.7 million in 2023 to $8.6 million in 2024, rising to 49% of total revenue from 42%[111] Operating Performance - Operating loss improved to $5.5 million in 2024 from $8.5 million in 2023, a reduction of approximately 35.3%[105] - Research and development expenses decreased by 15% from $9.1 million in 2023 to $7.8 million in 2024, accounting for 51% of total revenue[119] - Selling and marketing expenses decreased by 3% from $8.0 million in 2023 to $7.7 million in 2024, maintaining 44% of total revenue[123] - General and administrative expenses decreased by 3% from $6.5 million in 2023 to $6.4 million in 2024, increasing as a percentage of total revenue from 36% to 37%[125] Cash Flow and Financial Position - Cash used in operating activities was $3.2 million in 2024, primarily due to a $4.4 million net loss[133] - Cash provided by investing activities was $6.3 million in 2024, primarily from net sales of marketable securities[135] - As of December 31, 2024, the company had cash, cash equivalents, and marketable securities totaling $27.8 million, expected to fund operations for at least the next twelve months[138] - The company estimates material cash requirements from known contractual obligations will be approximately $0.7 million annually from 2025 to 2027, increasing to $2.7 million thereafter[139] Assets and Liabilities - As of December 31, 2024, the company reported $3.1 million in goodwill and $2.0 million in intangible assets, with no impairments recorded to date[156] - The company had total deferred tax assets of $13.7 million and deferred tax liabilities of $0.5 million as of December 31, 2024, with a valuation allowance of $13.2 million[162] Risk and Accounting Policies - The company has not experienced material impacts from inflation on financial results to date, but future effects remain uncertain[142] - The company does not have any off-balance sheet arrangements with unconsolidated entities, mitigating exposure to financing and credit risks[143] - Revenue recognition follows ASC 606, with revenue recognized when control of goods and services is obtained by the customer[145] - The company utilizes a five-step model for revenue recognition, including identifying contracts and performance obligations[149] - Stock-based compensation is measured at grant date fair value and recognized over the vesting period[157] - Recent accounting updates include ASU No. 2023-07 and ASU No. 2023-09, which will impact segment reporting and income tax disclosures, respectively[165][166] Future Outlook - The company plans to introduce new products to enhance biometrics solutions and expects research and development expenses to decrease in the next year before increasing in subsequent years[121]
Aware(AWRE) - 2024 Q4 - Annual Report