Financial Data and Key Metrics Changes - Total revenue reached a record $51.9 million, up 11% year over year in Q2 [27] - Non-GAAP gross profit for the quarter was $45.6 million, representing an 88% non-GAAP gross margin [28] - Adjusted EBITDA came in at $20.2 million, representing a 39% margin, reflecting a 52% increase year over year [35] Business Line Data and Key Metrics Changes - Deposit products revenue increased by 14% year over year to $33.7 million, driven by strong mobile deposit renewal activity [28][29] - Identity products revenue grew by 4% year over year to $18.2 million, highlighted by a 9% increase in Identity SaaS revenue [30] - Check Fraud Defender's SaaS revenue rose 64% year over year, indicating growing traction [30] Market Data and Key Metrics Changes - The company now has data sets covering approximately 23% of U.S. checking accounts, up from 18% [18] - SaaS revenue grew 15% year over year and now accounts for 40% of total last twelve months revenue, up from 39% [21][32] Company Strategy and Development Direction - The company aims to drive organic growth, increase the percentage of SaaS revenue, expand margins, and improve free cash flow conversion [9] - The focus is on enhancing automation, product development, and data analytics to support durable profitable growth [13] - The strategy includes a shift towards a layered signal-rich approach for identity verification, combining biometrics and behavioral data [23][24] Management's Comments on Operating Environment and Future Outlook - Management noted resilience in the business despite macroeconomic uncertainties, with no cancellations observed [37] - The full-year revenue guidance remains at $170 million to $180 million, with an expectation for Q3 revenue to modestly exceed Q4 [38] - Adjusted EBITDA margin guidance has been raised to 26% to 29%, reflecting strong first-half performance [38] Other Important Information - The company generated $47 million in free cash flow over the last twelve months, with an 86% conversion rate [22] - A $100 million senior credit facility was closed to support capital allocation strategies [36] Q&A Session Summary Question: What has gone well and what has been difficult for the company? - Management highlighted strong execution and traction in the past quarter, with positive feedback from customers regarding the focus on fraud and identity [42][46] Question: Can you discuss the guidance and any pull-forwards that helped drive the strength in the quarter? - A large mobile deposit customer order came in earlier than expected, contributing to the overachievement in Q2 [47][48] Question: How is the company progressing towards its target of reaching $20 million ACV? - The company is seeing substantial ramp-up in volumes and partnerships, indicating positive leading indicators for future growth [49][51] Question: Can you quantify the improvements from the modernized document onboarding system? - While specific data was not provided, management indicated meaningful acceleration in cycle times and improved customer experience [56][58] Question: What is the expected trend for SaaS revenue mix in the coming years? - The goal is for SaaS revenue to represent more than half of total revenue by 2026, driven by growth in fraud and identity verification products [60][62] Question: How does the company plan to achieve organic growth? - The focus is on adding new customers while expanding existing relationships through new products and solutions [71]

Financial Data and Key Metrics Changes - Total revenue reached a record $51.9 million, up 11% year over year in Q2 2025 [25] - Non-GAAP gross profit for the quarter was $45.6 million, representing an 88% non-GAAP gross margin [26] - Adjusted EBITDA came in at $20.2 million, reflecting a 39% margin, which slightly exceeded expectations [26][34] Business Line Data and Key Metrics Changes - Deposit products revenue increased by 14% year over year to $33.7 million, driven by strong mobile deposit renewal activity [26][28] - Identity products revenue grew by 4% year over year to $18.2 million, highlighted by a 9% increase in Identity SaaS revenue [29] - Check Fraud Defender's SaaS revenue rose 64% year over year, indicating growing traction [28] Market Data and Key Metrics Changes - The company now has data set coverage on approximately 23% of all U.S. checking accounts, up from 18% [16] - SaaS revenue grew 15% year over year and now accounts for 40% of total last twelve months revenue, up from 39% [19][31] Company Strategy and Development Direction - The company aims to drive organic growth, increase the percentage of SaaS revenue, expand margins, and improve free cash flow conversion [8] - Mitek is focusing on a layered signal-rich approach to identity verification, combining biometrics and behavioral data to enhance security [21][22] - The leadership team has been strengthened with the appointment of a new COO to focus on scaling automation and product development [12] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment remains uncertain, but the business has shown resilience and has not seen cancellations related to macroeconomic factors [36] - The company is maintaining its full-year revenue guidance range of $170 million to $180 million, reflecting a cautious approach to the current environment [37] - Adjusted EBITDA margin guidance has been raised to 26% to 29%, up from the previous range of 25% to 28% [37] Other Important Information - The company generated $47 million in free cash flow over the last twelve months, with an 86% conversion rate [20] - A $100 million senior credit facility was closed to support capital allocation strategies [35] Q&A Session Summary Question: What has gone well and what has been difficult for the company? - Management highlighted strong execution and traction in the past quarter, with no cancellations observed from the macro environment [44][45] Question: Can you discuss the guidance and any pull-forwards that helped drive the strength in the quarter? - A large mobile deposit customer order was received earlier than expected, contributing to the overachievement in Q2 [46] Question: How is the company progressing towards its target of reaching $20 million ACV? - The company is seeing substantial ramp-up in volumes and partnerships, indicating positive leading indicators for future growth [48][49] Question: Can you quantify the improvements from the modernized document onboarding system? - While specific data was not provided, management indicated that the automation significantly accelerates cycle times and improves customer experience [54][56] Question: What is the expected trend for SaaS revenue in the coming years? - The company aims for SaaS revenue to represent more than half of total revenue by 2026, driven by growth in fraud and identity verification products [58][59] Question: How does the company plan to balance new business growth with expansion in existing clients? - The focus is on both acquiring new clients and expanding relationships with existing ones through new product offerings [67][69]

Core Insights - FOREWARN, LLC has partnered with NEXUS Association of REALTORS to provide its services to over 5,000 real estate professionals in New Jersey, focusing on enhancing agent safety [1][3] - The FOREWARN service offers real-time data analysis, allowing agents to verify identities, check criminal histories, and validate client information using just a phone number [2][5] - NEXUS members will have access to FOREWARN services at no additional cost, promoting proactive safety measures for real estate agents [2][3] Company Overview - FOREWARN is a leading provider of real-time information solutions for real estate agents, leveraging extensive data analytics to enhance safety and decision-making [1][5] - The company aims to ensure safer engagements and smarter interactions through innovative solutions that provide instant knowledge [5][6] - Red Violet, the parent company of FOREWARN, specializes in identity intelligence and risk mitigation technologies, serving various sectors including real estate [6]

Core Insights - FOREWARN, LLC, a subsidiary of red violet, announced a partnership with HiCentral MLS® to provide its services to over 6,000 real estate agents in Honolulu and Oahu, enhancing agent safety [1][3] - The FOREWARN service utilizes extensive data analysis to help agents verify identities, check criminal histories, and validate client information using just a phone number, thereby increasing safety during property showings [2][5] Company Overview - FOREWARN offers its services at no additional cost to HiCentral MLS® members, aligning with the organization's mission to equip agents with resources for safety and fraud mitigation [3] - The technology behind FOREWARN is designed to provide real-time knowledge and risk assessment, enabling safer engagements and smarter interactions for real estate professionals [5][6] Additional Information - Other real estate agencies and professionals can access more information about FOREWARN through its website [4] - Red violet focuses on delivering identity intelligence through proprietary technologies and analytical capabilities, supporting various applications including fraud detection and regulatory compliance [6]

Financial Data and Key Metrics Changes - Fourth quarter revenues increased by 15% year-over-year, reaching a record $5,936,000 compared to $5,176,000 in Q4 2023 [31][32] - SaaS revenues for Q4 grew 17% quarter-over-quarter, totaling $5,900,000, while full-year SaaS revenues increased by 7% to $19,800,000 [9][36] - Adjusted EBITDA for the full year improved to a positive $520,000 compared to $377,000 in 2023 [39][42] - Gross profit margin for Q4 was 91%, down from 95% in the same period of 2023, primarily due to increased R&D costs [34][37] Business Line Data and Key Metrics Changes - Significant growth was observed in new verticals, with automotive, title insurance, email, social media, and retail banking verticals growing by 13%, 2,500%, 54%, and 17% respectively [10] - The title insurance vertical is particularly strong, with direct title clients accounting for approximately 45% of the market [11] - The company faced headwinds from retail bankruptcies and customer churn, particularly in bars, restaurants, and hardware-focused manufacturers [12] Market Data and Key Metrics Changes - Retail still represents approximately 75% of the company's scan volume, but transaction volumes from major retailers were down about 45% from Q4 2023 [29][55] - The company is diversifying away from retail, which is crucial given the current economic climate affecting consumer spending [29][51] Company Strategy and Development Direction - The company is focused on vertical channel diversification and enhancing ID validation services [6][7] - Investments in IT initiatives and customer success leadership are aimed at improving customer experience and marketing capabilities [7][21] - The migration from Azure to AWS is expected to yield cost savings and improve implementation speed [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth in the back half of 2025, driven by rollout schedules and proof of concepts [45][46] - Concerns about consumer confidence and macroeconomic factors are acknowledged, but the company remains focused on fraud prevention as a consistent need across industries [49][50] - The company anticipates a cautious outlook for Q1 2025, aligning with sell-side consensus estimates of $4,780,000 [28][39] Other Important Information - The company has a $2,000,000 revolving credit facility with Citibank, which was not utilized during 2024 [40] - The company expects to finish Q1 2025 with a cash balance of approximately $5,000,000, indicating strong cash generation capabilities [39] Q&A Session Summary Question: Visibility on stronger back half of the year - Management indicated that visibility is based on rollout schedules and proof of concepts, with delays potentially leading to easier implementations in the future [45][46] Question: Disruption in sales conversations due to macro conditions - No significant disruption was noted in sales conversations, as fraud remains a consistent issue across industries [49][50] Question: Potential operating expense savings from switching to AWS - Management expects significant savings from the AWS transition, with ongoing negotiations for better rates from cloud providers [52] Question: Clarification on Q4 revenue strength and Q1 expectations - The strength in Q4 was attributed to non-retail improvements, while Q1 is expected to see a drop due to worsening retail conditions [55][58] Question: Update on large social media customer - The company is finalizing procurement discussions and expects updates soon [60][61] Question: Expectations for EBITDA improvement in 2025 - Management anticipates continued improvement in EBITDA for 2025, with a focus on maintaining positive growth [62]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 increased by 10% to $4.8 million compared to $4.4 million in Q4 2023, driven by higher software license revenue, including a $1 million one-time license sale to a European government [25] - Recurring revenue for Q4 was $3.3 million, down from $3.7 million in the prior year, primarily due to timing of revenue recognition [25] - For the full year, total revenue decreased to $17.4 million from $18.2 million, attributed to lower software license revenue [28] - Full year recurring revenue grew by 9% to $12 million, making up 69% of total revenue, indicating a focus on stable revenue streams [29] - Operating expenses decreased by 14% to $22.9 million for the full year, improving operational efficiency [29] Business Line Data and Key Metrics Changes - The increase in Q4 revenue was largely due to software license sales, while recurring revenue showed slight fluctuations due to contract timing [25][28] - The company experienced a decline in total revenue for the full year despite growth in recurring revenue, highlighting the variability in non-recurring revenue streams [28][57] Market Data and Key Metrics Changes - The biometrics industry is experiencing increased demand due to rising AI-driven fraud, making innovative biometric solutions critical [13] - The company aims to strengthen partnerships with government agencies and commercial enterprises to drive broader adoption of biometric technologies [19] Company Strategy and Development Direction - The company is focused on three key priorities: deepening strategic partnerships, advancing technological innovation, and scaling sustainably [18] - Aware is committed to refining its go-to-market strategy to improve efficiency and unlock new revenue opportunities, especially in light of anticipated revenue headwinds in 2025 [16][22] Management's Comments on Operating Environment and Future Outlook - Management acknowledges macroeconomic headwinds and government budget constraints but remains optimistic about the company's strategic initiatives and long-term growth potential [16][22] - The CEO emphasized the importance of enhancing sales efficiency and deepening customer relationships to position the company for sustainable growth [40] Other Important Information - The company has a strong balance sheet with cash and marketable securities totaling $27.8 million as of December 31, 2024 [32] - The CEO's personal investment in the company reflects confidence in its long-term potential and strategy [63] Q&A Session Summary Question: What changes are being implemented to improve sales efficiency? - The company is refining its go-to-market strategy by prioritizing high-value customers and optimizing its pricing model to enhance competitiveness [39][40] Question: Why is now a good time for Aware to initiate a more effective go-to-market strategy? - The current market conditions, including the prevalence of AI-driven fraud and consumer acceptance of biometrics, present a favorable environment for growth in the biometrics industry [47] Question: What drove the reduction in operating expenses for the year? - The reduction in operating expenses was due to a disciplined approach to cost optimization, including streamlining operations and reducing discretionary spending [50] Question: Do you expect the recent DOGE activity to impact the business? - The company is monitoring potential shifts in procurement patterns but believes its longstanding relationships and mission-critical solutions position it well to navigate changes [53][54] Question: Can you walk through the revenue changes for Q4 and the full year? - The increase in Q4 revenue was driven by a one-time license contract, while the full year decline was due to fluctuations in license sales based on government agency buying cycles [56][57] Question: How did the recurring revenue growth trend? - Annual recurring revenue increased by 9% year-over-year, although it fell short of the initial double-digit growth guidance [59] Question: Are you looking to implement M&A as a potential component of your growth strategy? - The primary focus remains on organic growth, but the company continues to evaluate strategic acquisition opportunities that could enhance its technology roadmap [61]