Company Overview - Aware, Inc. is a leading global biometrics company that utilizes data science and machine learning to address business and identity challenges through biometrics [3] - The company has over 30 years of experience in the field and is recognized for its ethical and responsible approach to biometric technology [3] Upcoming Financial Event - Aware will hold a webcast on July 30, 2025, at 5:00 p.m. Eastern time to discuss its financial results for the second quarter ended June 30, 2025 [1][2] - Financial results will be released in a press release prior to the webcast, which will include a presentation followed by a question-and-answer session [1] Investor Engagement - Interested parties can submit questions in advance of the webcast via email [2] - The presentation will be available for replay in the investor relations section of the company's website for approximately 90 days after the live event [2]

Company Overview - Aware, Inc is a global biometric identity platform company using data science, machine learning, and AI to address business and identity challenges[7] - The company has a 30-year legacy of innovation and market leadership in biometric technology[23] - Aware has a strong financial foundation for growth, focusing on recurring revenue and profitability[29] Market and Growth - The global biometric system market is projected to grow to $82.9 billion by 2027[11] - Aware experienced a 15% top-line revenue CAGR from 2020 to 2023[33] - The company achieved 20% ARR & Recurring Revenue Growth[33] Technology and Differentiation - Aware's technology combines liveness and authentication, multi-modal automated biometric identification system, integration-ready middleware, and biometric orchestration[35] - Aware is leading in preventing bias in biometric technologies, with competitors having 2X to 4X more bias in liveness detection and matching[41] - The company has ~80 U S & International Patents[36] Financial Highlights - Aware has $28.5 million in cash, cash equivalents & marketable securities with no debt[28] - The company maintains a >90% customer retention rate[26]

Core Insights - Aware, Inc. has been recognized as an industry Luminary in Core Identity Technology in the Prism Project's Deepfake and Synthetic Identity Report, highlighting its leadership in biometric authentication [1][2] - The company announced enhancements to its Awareness Platform, improving face matching performance and mobile face capture reliability [1][3] Company Recognition - The Prism Project's report evaluates over 200 organizations and emphasizes Aware's strengths in injection detection, deepfake detection, and liveness detection [2] - Aware's recognition as a Luminary reflects its long-standing commitment to secure and scalable biometric solutions, validated by independent testing from RIVTD and NIST [3] Platform Enhancements - Key improvements to the Awareness Platform include: 1. **Faster Face Matching**: Achieves up to 14x faster 1:N face search performance, reducing server resource usage and infrastructure costs while maintaining matching accuracy [5][7] 2. **Smarter Face Capture**: New mobile capture updates for iOS and Android enhance first-time success rates and optimize image quality, improving user experience and conversion rates [5][7] Industry Context - The report provides strategic guidance for decision-makers in the identity fraud landscape, emphasizing the need for organizations to verify identities confidently amid rising threats from deepfakes and digital deception [2][4] - Aware's innovations aim to help customers navigate the evolving digital identity landscape, balancing speed, security, and usability [5][7]

Core Insights - Aware, Inc. achieved best-in-class performance in the U.S. Department of Homeland Security's Remote Identity Validation Technology Demonstration, particularly excelling in passive liveness detection for presentation attack detection [1][3][4] - The DHS RIVTD program aims to challenge industry leaders to develop secure and user-friendly remote identity validation technologies to combat identity fraud during digital onboarding [2][4] - Aware's passive liveness detection technology is more efficient and user-friendly compared to active systems, which require user interaction and result in longer transaction times and higher failure rates [3][4] Company Performance - Aware's solution demonstrated top-tier performance in passive liveness detection, reaffirming its capabilities in combating identity fraud and reducing user friction [3][4] - The company is committed to delivering fast, accurate, and secure biometric solutions validated by leading government agencies like DHS [4][5] Future Outlook - Aware plans to participate in the upcoming RIVR 2025 testing to showcase advanced liveness features not included in previous tests, such as a patented bright screen reflection algorithm and behavioral algorithms [5][6] - The company emphasizes the importance of independent evaluations like RIVTD for establishing trust and improving biometric performance standards [5]

Core Insights - Aware, Inc. has appointed Lona Therrien as the new Chief Marketing Officer, signaling a commitment to accelerate growth in the biometric authentication sector [1][4] - Therrien has over 15 years of experience in the cybersecurity industry and has a proven track record in building marketing teams and executing successful go-to-market strategies [2][3] - The appointment is part of a broader strategy to enhance Aware's leadership team, which includes other key hires in the cybersecurity domain [4][5] Company Overview - Aware, Inc. is a global biometric platform company that leverages data science and machine learning to address identity challenges through biometric solutions [6] - The company has been a trusted name in the biometric field for over 30 years, focusing on providing secure and frictionless user experiences for government and commercial enterprises [6] Leadership and Strategy - Lona Therrien's leadership is expected to align marketing efforts with business growth, enhancing Aware's market presence and customer engagement [4][5] - The company aims to deliver fast, secure, accurate, and scalable biometric solutions to meet the growing demand in the market [5]

Core Insights - Research Solutions has integrated advanced search capabilities into its Article Galaxy platform, allowing researchers to search across citation statements from full-text articles, marking a significant improvement over traditional search methods [1][3][4] Company Developments - The upgraded search system reflects Research Solutions' commitment to innovation and feature enhancement based on customer feedback, enabling more relevant literature discovery through both basic and sophisticated search methods [3][5] - The new search functionality aims to improve research efficiency and strengthen Article Galaxy's position as a comprehensive platform for managing scientific literature [4][5] Industry Context - The enhanced literature discovery tools represent a growth area within scientific research technologies, addressing the challenges posed by the increasing volume of published research [5] - The integration of AI-powered tools and advanced search capabilities positions Research Solutions as a key player in simplifying research workflows for academic institutions and life science companies [7]

Core Insights - Aware, Inc. (AWRE) experienced a 4.7% decline in share price following its earnings report for the year ended March 31, 2025, contrasting with a 2.3% gain in the S&P 500 Index during the same period [1] - The company reported total revenues of $3.6 million for Q1 2025, an 18.4% decrease from $4.4 million in the same quarter last year, primarily due to a 38.7% drop in software license sales [2] - A net loss of $1.6 million was recorded for Q1 2025, widening from a loss of $0.9 million a year earlier, with net loss per diluted share increasing to $0.08 from $0.05 [3] Revenue and Profitability - Recurring revenues fell 14.7% to $2.7 million from $3.1 million year-over-year, influenced by the timing of license renewals [2] - Operating expenses decreased by 3.9% to $5.5 million, yet the operating loss expanded to $1.9 million from $1.3 million in the prior year [4] - Cash, cash equivalents, and marketable securities totaled $24.8 million at the end of the quarter, down from $27.8 million at the end of 2024 [4] Segment Performance - Software maintenance revenue remained stable at $2.2 million, while software subscriptions dropped 46.1% to $0.5 million [5] - Non-recurring software license revenue decreased by 32.4%, whereas service-related revenue increased by 21.9% [5] Management Strategy - CEO Ajay Amlani described the quarter as transitional, focusing on long-term scalable growth and realigning the go-to-market strategy [6] - The company is engaging with Fortune 500 firms for biometric solutions aimed at identity verification and fraud prevention [6][7] - CFO David Traverse indicated that 2025 is a foundational year, with strategic changes expected to show more impact in 2026 [10] Leadership Changes - Key leadership changes were made, including the appointment of Brian Krause as Chief Revenue Officer and Gary Evee as chairman of the board, reflecting a commitment to a disciplined commercialization strategy [11]

Revenue Performance - Revenue for Q1 2025 was $3.6 million, a decrease of 18% from $4.4 million in Q1 2024, with an operating loss of $1.9 million compared to a loss of $1.3 million in the prior year [72]. - Software license revenue decreased by 39% from $2.1 million in Q1 2024 to $1.3 million in Q1 2025, representing 36% of total revenue, down from 49% [75]. - Software maintenance revenue remained stable at $2.2 million for both Q1 2025 and Q1 2024, increasing its share of total revenue from 49% to 60% [78]. Cost Management - Total engineering costs decreased by 12% from $2.3 million in Q1 2024 to $2.0 million in Q1 2025, with engineering costs as a percentage of total revenue rising from 52% to 56% [87]. - Selling and marketing expenses decreased by 12% from $1.9 million in Q1 2024 to $1.7 million in Q1 2025, but increased as a percentage of total revenue from 43% to 46% [90]. - General and administrative expenses increased by 22% from $1.3 million in Q1 2024 to $1.6 million in Q1 2025, rising from 30% to 45% of total revenue [94]. Financial Position - Cash, cash equivalents, and marketable securities totaled $24.8 million as of March 31, 2025, a decrease of $3.0 million from December 31, 2024, primarily due to $2.9 million used in operating activities [100]. - Interest income remained stable at $0.3 million for both Q1 2025 and Q1 2024, but is expected to decrease slightly for the remainder of 2025 [96]. Strategic Initiatives - The company anticipates an increase in engineering expenses in 2025 to support strategic product development initiatives [88]. - The company plans to backfill key positions and increase selling and marketing expenses to capitalize on market opportunities [92].

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $3.6 million, down from $4.4 million in Q1 2024, primarily due to lower software license sales [13] - Recurring revenue decreased to $2.7 million from $3.1 million year-over-year, attributed to the timing of subscription term license renewals [14] - Operating expenses were reduced to $5.5 million, down 5% from $5.7 million in the prior year [14] - GAAP net loss was $1.6 million or $0.08 per diluted share, compared to a net loss of $1.0 million or $0.05 per diluted share in Q1 2024 [14] - Adjusted EBITDA loss for the quarter was $1.5 million, compared to a loss of $1.0 million in the prior year [15] - Cash, cash equivalents, and marketable securities totaled $24.8 million as of March 31, 2025, down from $27.8 million at the end of 2024 [16] Business Line Data and Key Metrics Changes - The company is focusing on high-impact customers and sectors where biometric authentication is critical, leading to active conversations with several Fortune 500 companies [7][8] - The leadership team has been strengthened with the appointment of a new Chief Revenue Officer and a chairman with extensive experience in cybersecurity [9] Market Data and Key Metrics Changes - There is strong interest in biometric solutions across various sectors, including financial services, healthcare, and e-commerce, as enterprises recognize the inadequacy of traditional authentication methods [30] - The U.S. Federal government's commitment to biometric modernization remains strong, providing a significant market opportunity [20][37] Company Strategy and Development Direction - The company is undergoing a strategic transformation with a focus on durable, scalable growth and a streamlined go-to-market strategy [5][6] - Key strategic priorities include deepening partnerships, advancing core technology, and scaling the business sustainably [6][10] - The Awareness platform is being developed as an open, flexible architecture that allows customers to integrate best-in-class algorithms, differentiating the company from competitors [22][34] Management's Comments on Operating Environment and Future Outlook - Management views 2025 as a foundational year for the company, with expectations of building momentum heading into the second half of the year [12][25] - There is confidence in the strategic groundwork laid, which positions the company for leadership in the biometrics industry [25][39] Other Important Information - The company has revitalized its brand presence and increased visibility at key industry events [11][24] - A culture of transparency and accountability has been instilled within the organization to support the transformation [11] Q&A Session Summary Question: Will Aware continue to pursue growth in annual recurring revenues via sales of the Aware ID product? - The focus is on solving large-scale identity challenges for enterprises and government agencies rather than driving growth through a single product [28] Question: Has Aware made progress in adding customers or growing sales on the AWS Marketplace or any of the other partner programs? - The top priority is direct engagement with customers, and partnerships will be selective, focusing on those that add strategic value [29] Question: Could you provide more color on the types of industries or use cases these companies are exploring with Aware's biometric solutions? - Strong engagement is seen across industries such as financial services, healthcare, and e-commerce, where secure identity verification is critical [30] Question: How should we think about the timing and potential revenue contribution from some of the new strategic opportunities? - 2025 is viewed as a foundational year, with expectations for early wins later in the year and contributions building over time [32][33] Question: How does the open architecture approach differentiate Aware from competitors? - The Awareness platform offers an open modular architecture, allowing customers to choose algorithms and ensuring scalability and future-proofing [34] Question: Are there specific programs or initiatives where you feel particularly well positioned today? - The company is well positioned across the U.S. Government portfolio, focusing on secure digital identity and modernization initiatives [36][37] Question: What early indicators are you seeing that give you confidence Aware is on the right trajectory for scalable, sustainable growth? - Tangible progress is noted in pipeline expansion, leadership installation, and growing customer interest in Aware's technology [38]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $3.6 million, down from $4.4 million in Q1 2024, primarily due to lower software license sales [14] - Recurring revenue decreased to $2.7 million from $3.1 million in the prior year, attributed to the timing of subscription term license renewals [15] - Operating expenses were reduced to $5.5 million, down 5% from $5.7 million in Q1 2024 [15] - GAAP net loss was $1.6 million or $0.08 per diluted share, compared to a net loss of $1 million or $0.05 per diluted share in Q1 2024 [15] - Adjusted EBITDA loss for the quarter was $1.5 million, compared to a loss of $1 million in the prior year [16] Business Line Data and Key Metrics Changes - The company is focusing on deepening strategic partnerships and has realigned its go-to-market model to prioritize high-impact customers and sectors [8] - Active conversations are ongoing with several Fortune 500 companies, indicating a shift in engagement and potential revenue opportunities [8][30] Market Data and Key Metrics Changes - There is strong interest in biometric solutions across various sectors, including financial services, healthcare, and e-commerce, as enterprises recognize the need for secure identity verification [30] - The U.S. Federal government's commitment to biometric modernization remains strong, providing a significant market opportunity [21][38] Company Strategy and Development Direction - The company is undergoing a strategic transformation with a focus on durable, scalable growth and a streamlined go-to-market strategy [6] - Key strategic priorities include deepening partnerships, advancing core technology, and scaling the business sustainably [7] - The Awareness platform is being developed to offer an open, flexible architecture that differentiates the company from competitors [35][36] Management's Comments on Operating Environment and Future Outlook - Management views 2025 as a foundational year for the company, with expectations of building momentum heading into the second half of the year [13][40] - The leadership team is confident in the strategic groundwork laid, which positions the company for leadership in the biometrics industry [26] Other Important Information - The company has strengthened its leadership team, appointing a new Chief Revenue Officer and a chairman with extensive experience in cybersecurity [9][10] - The brand has been revitalized, focusing on modernizing its presence and increasing visibility in key markets [12][25] Q&A Session Summary Question: Will Aware continue to pursue growth in annual recurring revenues via sales of the Aware ID product? - The focus is on solving large-scale identity challenges for enterprises and government agencies rather than driving growth through a single product [28] Question: Has Aware made progress in adding customers or growing sales on the AWS Marketplace? - The priority is direct engagement with customers, and partnerships will only be pursued if they add strategic value [29] Question: Can you provide more color on the types of industries or use cases these companies are exploring with Aware's biometric solutions? - Engagement is strong across industries like financial services, healthcare, and e-commerce, where secure identity verification is critical [30] Question: What is the timing and potential revenue contribution from new strategic opportunities in the second half of 2025? - 2025 is viewed as a foundational year, with expectations for early wins later in the year and contributions building over time [32][34] Question: How does the Awareness platform differentiate Aware from competitors? - The platform offers an open modular architecture, allowing customers to orchestrate best-in-class algorithms, providing flexibility and scalability [35][36] Question: Are there specific programs or initiatives where Aware feels particularly well positioned? - Aware is well positioned across the U.S. Government portfolio, focusing on secure digital identity and modernization initiatives [38] Question: What early indicators show Aware is on the right trajectory for growth? - The pipeline has expanded significantly, and there is growing interest from customers recognizing Aware's technology leadership [39]