Financial Data and Key Metrics Changes - Total revenue for Q3 was $45.7 million, up 2% year over year, driven primarily by identity products which grew 24% year over year [24][27] - Non-GAAP gross margin for the quarter was 85%, about 100 basis points less than a year ago due to a slight mix shift away from higher margin deposit products [24] - Free cash flow for the last twelve months was $55.8 million, representing a 99% conversion rate [32] Business Line Data and Key Metrics Changes - Identity revenue reached $75 million, up 13% year over year, with SaaS revenue growing 19% [12][24] - Deposits product revenue was $26.2 million, with trailing twelve month license revenue totaling $69.1 million, reflecting resilience despite overall check volume declines [26][27] - Check Fraud Defender's annual contract value reached approximately $13.1 million, up 56% year over year [16] Market Data and Key Metrics Changes - SaaS revenue now represents over 41% of trailing twelve month revenue, up from the previous quarter [19][29] - The fraud prevention consortium now encompasses approximately a quarter of all U.S. checking accounts, around 100 million accounts [8][18] Company Strategy and Development Direction - The company is focused on four strategic pillars: strengthening the foundation, scaling identity, expanding fraud solutions, and driving operational excellence [9][19] - The goal is to unify the platform that integrates identity, authentication, and fraud detection, positioning the company for scalable, durable growth [35][73] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in approaching a fulcrum point for durable profitability in the identity product portfolio [6][12] - The company anticipates continued execution in 2026, focusing on unifying the platform and strengthening the foundation [38][39] Other Important Information - The company has launched efficiency initiatives, including vendor audits and renegotiation of contracts, to improve operational efficiency [20] - The company ended Q3 with over $175 million in cash and investments, maintaining a healthy net cash position [32] Q&A Session Summary Question: How is the company thinking about returning to double-digit growth in 2026? - Management indicated that 2026 will focus on unifying the platform and strengthening the foundation, with anticipated revenue growth from SaaS solutions [38] Question: What is the outlook for deposit software revenue, which is down 20% year over year? - Management noted stability in transaction volumes and successful offsetting of revenue declines with increases in average selling prices [40][41] Question: How is the pipeline looking for Check Fraud Defender? - Management reported excellent ongoing dialogues with multiple partners and optimism about converting pilot phases into contracts [44][46] Question: What are the most exciting developments for the rest of fiscal year 2025 and heading into 2026? - Management expressed enthusiasm about executing on outlined goals, stability in mobile deposit business, and growth potential in fraud and identity solutions [49][50] Question: Can you provide an update on the larger IDR and D deals? - Management stated that some larger deals are still in progress, with ongoing focus on closing those deals [57] Question: How does the company plan to allocate cash and cash flow going forward? - Management emphasized a balanced approach between investing in the business and returning capital to shareholders, with a focus on organic growth [81][84] Question: Is there potential for further margin improvements from automation? - Management confirmed a 200 basis points year-over-year improvement in services gross margin and indicated room for further automation-driven improvements [86]

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]