Mitek Systems(US:MITK)2026-02-05 21:13Financial Performance - Revenue for the three months ended December 31, 2025, was $44.2 million, an increase of 19% compared to $37.3 million in the same period of 2024[126] - Net income for the same period was $2.8 million, or $0.06 per diluted share, compared to a net loss of $4.6 million, or $0.10 per diluted share, in the prior year[126] - Cash provided by operating activities was $8.0 million for the three months ended December 31, 2025, compared to $0.6 million in the same period of 2024[126] Revenue Breakdown - Software license revenue increased by $1.9 million, or 16%, to $13.9 million, driven by standalone biometrics ID Live products[129] - SaaS, maintenance, and other revenue increased by $5.1 million, or 20%, to $30.3 million, primarily due to increased transaction volume from MiVIP and Check Fraud Defender products[129] Expenses - Cost of revenue increased by $2.5 million, or 41%, to $8.4 million, attributed to increased SaaS revenue and higher personnel costs[130] - Selling and marketing expenses decreased by $1.5 million, or 16%, to $8.1 million, due to a reallocation of headcount and lower stock-based compensation[131] - Research and development expenses decreased by $0.9 million, or 11%, to $7.4 million, primarily due to lower stock-based compensation and increased capitalized software development costs[132] - General and administrative expenses decreased by $0.8 million, or 7%, to $11.1 million, mainly due to lower bad debt expense and reduced professional fees[133] Other Income and Cash Flow - Other income increased by $0.9 million, or 166%, to $1.5 million, primarily due to lower foreign currency exchange losses and higher other income[137] - Net cash provided by operating activities for the three months ended December 31, 2025 was $8.0 million, an increase of $7.5 million compared to $0.6 million for the same period in 2024, primarily due to an increase in net income[140] Investment and Financing Activities - Net cash provided by investing activities was $24.4 million during the three months ended December 31, 2025, up from $0.8 million in the same period in 2024, mainly due to net maturities of investments of $25.8 million[141] - Net cash used in financing activities was $11.5 million for the three months ended December 31, 2025, compared to $3.1 million in the same period in 2024, primarily due to higher repurchases and retirements of Common Stock[142] - The company issued $155.3 million aggregate principal amount of 0.75% Convertible Senior Notes due 2026, with net proceeds of approximately $149.7 million after expenses[145] - The company entered into an Amended Credit Agreement providing for a delayed draw term loan of up to $75.0 million and a revolving line of credit of up to $25.0 million[152] Share Repurchase and Capital Structure - The company repurchased $10.0 million worth of shares, or 1,078,333 shares, during the three months ended December 31, 2025, at an average price of $9.27 per share[160] - Total purchases under the share repurchase program since inception reached $39.0 million as of December 31, 2025, with all repurchased shares retired[160] Cash and Investments - As of December 31, 2025, the company had $191.8 million in cash and cash equivalents, a decrease of $4.7 million, or 2%, from $196.5 million on September 30, 2025[139] - The company had investments of $16.7 million in available-for-sale debt securities as of December 31, 2025, with $15.0 million classified as current and $1.7 million as long-term[162] - Marketable securities had a fair market value of $16.7 million as of December 31, 2025, representing 4% of total assets[167] Financial Risks and Conditions - Cash and cash equivalents, along with proceeds from the Amended Credit Agreement, are expected to meet material cash requirements for at least the next twelve months[163] - The company has not used derivative financial instruments in its investment portfolio, which is focused on preserving principal and maximizing after-tax yields[167] - A hypothetical 100 basis point change in market interest rates would not materially impact the fair value of cash equivalents and debt securities due to their short maturities[168] - Operations in the UK, France, the Netherlands, and Spain are exposed to foreign currency exchange rate fluctuations, particularly between the U.S. dollar, Euro, and British pound sterling[169] - Inflation has not had a material effect on the company's financial condition or results of operations for the three months ended December 31, 2025[170] - The company may face challenges in offsetting higher costs due to inflation through price increases, which could harm its financial condition[171]