Mitek Systems Q1 Earnings Call Highlights

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]