Financial Data and Key Metrics Changes - Fourth quarter revenues increased by 15% year-over-year, reaching a record $5.936 million compared to $5.176 million in Q4 2023 [48][50] - SaaS revenues for Q4 grew 17% quarter-over-quarter, totaling $5.913 million, while full-year SaaS revenues increased by 7% to $19.8 million [13][55] - Adjusted EBITDA for the full year 2024 was positive at $520,000, an improvement from a loss of $377,000 in 2023 [49][59] - Gross profit margin for Q4 was 91%, down from 95% in the same period of 2023, primarily due to increased R&D costs [50][55] Business Line Data and Key Metrics Changes - The company focused on vertical channel diversification, with significant growth in new verticals such as automotive (13%), title insurance (2,500%), email (54%), social media (17%), and retail banking [14][17] - SaaS revenue for the full year was $19.8 million, just shy of the $20 million mark, indicating strong performance in the SaaS segment [13][55] 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 45% year-over-year in Q1 2025 [44][82] - The company anticipates that lower mortgage rates will drive significant refinancing and improved home purchasing activity, particularly benefiting the title insurance vertical [17] Company Strategy and Development Direction - The company is investing in IT initiatives and enhancing customer experience through new leadership in the customer success team [9][31] - A strategic focus on longer contracts with minimums and guarantees is expected to yield positive results [42] - The transition from Azure to AWS is anticipated to improve efficiency and reduce costs, while also enhancing AI capabilities [30][76] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the first quarter of 2025, expecting revenues to align with sell-side consensus estimates of $4.78 million [45] - The company is aware of macroeconomic challenges affecting consumer confidence and spending, which could impact retail volumes [43][71] - Management believes that the diversification strategy is working, with a focus on higher-value transactions in new verticals [42][84] Other Important Information - The company reported a net loss of $918,000 for the full year 2024, an improvement from a loss of $1.98 million in 2023 [58] - The company has a $2 million revolving credit facility with Citibank, which was not utilized during 2024 [60] 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 expectations for growth in the back half of the year [65][68] Question: Disruption in sales conversations due to macro conditions - Management reported no disruption in sales conversations, as fraud remains a consistent issue across industries [70][72] Question: Potential operating expense savings from switching to AWS - Management expects significant savings from the transition to AWS, while balancing the need for extensive computing power for AI and machine learning [75][76] Question: Clarification on Q4 revenue strength and Q1 outlook - Management noted that Q4 strength was driven by non-retail improvements, with a significant drop in retail transaction volumes expected in Q1 [81][84] Question: Update on large social media customer - Management is finalizing procurement discussions and expects updates soon, with testing already completed [87][89] Question: Sales team composition and focus - The company has added three new sales associates, focusing on a consultative selling approach across various verticals [92][94] Question: Top priorities for 2025 - Management emphasized that sales growth is the top priority, alongside improving customer success and marketing strategies [98][100]

Intellicheck (IDN) Q4 2024 Earnings Call March 20, 2025 04:30 PM ET Company Participants Gar Jackson - Founder & PresidentBryan Lewis - CEOAdam Sragovicz - Chief Financial OfficerMike Grondahl - Head of Equities & Director of ResearchNeil Cataldi - Principal Conference Call Participants Scott Buck - Managing Director & Senior Technology AnalystRudy Kessinger - Managing Director - Senior Equity Research AnalystDaniel Hibshman - Research AnalystNone - Analyst Operator Greetings, and welcome to the IntelliJek ...

Intellicheck (IDN) Q4 2024 Earnings Call March 20, 2025 04:30 PM ET Company Participants Gar Jackson - Founder & PresidentBryan Lewis - CEOAdam Sragovicz - Chief Financial OfficerMike Grondahl - Head of Equities & Director of ResearchNeil Cataldi - Principal Conference Call Participants Scott Buck - Managing Director & Senior Technology AnalystRudy Kessinger - Managing Director - Senior Equity Research AnalystDaniel Hibshman - Research AnalystNone - Analyst Operator Greetings, and welcome to the IntelliJek ...

Revenue Performance - Revenues for the three months ended September 30, 2024 decreased by $51, or 1%, to approximately $4,709 compared to $4,760 for the same period of 2023[116] - Revenues for the nine months ended September 30, 2024 increased by $330, or 2%, to approximately $14,060 compared to $13,730 for the same period of 2023[119] - Equipment revenue decreased by $93, or 88%, to $13 for the three months ended September 30, 2024, while SaaS revenue increased by $26, or 1%, to $4,661[116] - SaaS revenue for the nine months ended September 30, 2024 increased by $370, or 2%, to $13,896 compared to $13,526 for the same period of 2023[119] Profit and Loss - Gross profit for the three months ended September 30, 2024 decreased by $47, or 1%, to $4,285, maintaining a gross profit margin of 91%[117] - The net loss for the three months ended September 30, 2024 was $(837), compared to a net loss of $(724) for the same period in 2023[118] - The net loss for the nine months ended September 30, 2024 was $(1,406), significantly improved from a net loss of $(2,964) for the same period in 2023[124] - Net loss for the three months ended September 30, 2023, was $(837) million, while the net loss for the nine months ended September 30, 2023, was $(1,406) million[134] Operating Expenses - Operating expenses for the nine months ended September 30, 2024 decreased by $1,352, or 9%, to $14,391 compared to $15,743 for the same period of 2023[123] - Restructuring severance expenses amounted to $376 million for the three months ended September 30, 2023, and $548 million for the nine months ended September 30, 2023[134] - Stock-based compensation, including liability classified awards, was $237 million for the three months ended September 30, 2023, and $1,347 million for the nine months ended September 30, 2023[134] Cash and Assets - As of September 30, 2024, the company had cash and cash equivalents of $5,747 and total assets of $20,682[125] - The company anticipates that available cash and expected cash from operations will be sufficient to meet working capital and capital expenditure requirements for at least the next 12 months[127] Other Financial Information - Adjusted EBITDA for the three months ended September 30, 2023, was $(167) million, compared to $(341) million for the nine months ended September 30, 2023[134] - Interest and other income for the three months ended September 30, 2023, was $(73) million, while for the nine months it was $(230) million[134] - The company reported a provision for income taxes of $8 million for the three months ended September 30, 2023[134] - Depreciation and amortization for the three months ended September 30, 2023, was $130 million[134] Financing and Risk - The company has not entered into any off-balance sheet financing arrangements or established any special purpose entities[135] - There were no guarantees of debt or commitments of other entities by the company[135] - The company has not disclosed any market risk applicable to smaller reporting companies[135]

Core Viewpoint - Investors reacted negatively to Intellicheck's slight revenue miss, resulting in a 12% drop in shares, but management highlighted potential growth in identity verification services, particularly in real estate and banking sectors [1] Financial Performance - Third-quarter revenue was $4.7 million, approximately flat year-over-year and about 3% below consensus estimates [2] - Software-as-a-Service (SaaS) revenue increased by 1%, contributing significantly to the overall revenue [2] - Pricing power remained robust, with new business pricing per transaction rising by 25% year-on-year and 8% sequentially [2] Business Development - The appointment of Sandra Bower as vice president of customer success is expected to enhance revenue from existing customers through a deeper focus on the product pipeline [3] - A large regional bank has signed a multiyear agreement, fully implementing Intellicheck's services in 1,200 branches, with expectations of mid-6-figure annual revenue [5] - Another regional bank with over 2,700 branches is finalizing a multiyear deal for in-branch implementations, with potential for a seven-figure revenue increase by 2025 [6] Sector Growth - The real estate sector is experiencing solid growth, driven by the need for identity verification due to fraud schemes that have resulted in billions in losses [7] - Fraudsters often exploit stolen personal information in real estate transactions, highlighting the importance of Intellicheck's ID verification tools [8] - Westcor Land Title Insurance Company is utilizing Intellicheck's technology for advanced ID verification, contributing to growth in the automobile segment, which saw a 28% year-on-year increase [9] Market Challenges - The retail segment has faced pressures, including bankruptcies of three clients and reduced consumer spending, impacting overall revenue stability [10] - Management expressed hope that declining inflation could reverse current headwinds into tailwinds for the business [11] - The company is actively exploring other verticals for growth, indicating that many customers have not fully implemented their solutions yet [12]

Financial Data and Key Metrics Changes - Total revenues for Q3 2024 were $4.71 million, a decrease of 1% compared to $4.76 million in Q3 2023 [67] - SaaS revenues increased by 1% to $4.66 million from $4.64 million in the same period last year, representing 99% of total revenues [67] - Gross margin remained strong at 91%, consistent with the previous year [66][68] - Net loss for Q3 2024 was $837,000, compared to a net loss of $724,000 in Q3 2023, with a net loss per diluted share of $0.04 for both periods [71] Business Line Data and Key Metrics Changes - New business price per transaction increased by 25% year-over-year and 8% sequentially from Q2 2024 [7] - The banking vertical is expected to see significant revenue growth, with a new multiyear agreement anticipated to generate mid-6-figure annual revenues [23][24] - The automotive vertical experienced a 28% growth over Q3 2023, indicating strong performance in this area [47] Market Data and Key Metrics Changes - Retail transaction volumes saw a double-digit decline in Q3 2024, attributed to economic conditions and inflation [90] - The company is diversifying into new verticals, which are expected to show significant growth opportunities in 2025, offsetting weaknesses in retail [100] Company Strategy and Development Direction - The company is focusing on expanding into financial services and other verticals to diversify revenue streams [76] - Marketing initiatives are being enhanced to drive interest in product offerings across multiple verticals [16] - The company is committed to maintaining high gross margins while improving architecture and data intelligence capabilities [75] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of retail bankruptcies and consumer spending pullback on business but emphasized the successful strategic plan to enter new markets [99] - The outlook for Q4 2024 anticipates continued gross margins of approximately 90% to 91% [75] - Management expressed optimism about the sales pipeline, particularly in financial services, social media, hospitality, and entertainment sectors [73] Other Important Information - The company has invested approximately $8.8 million in R&D related to product development over the past two years [61] - A significant focus is placed on enhancing the ID verification platform to stay ahead of evolving fraud tactics [60] Q&A Session Summary Question: When do you start to anniversary some of those more difficult retail comps? - Management indicated that the weakness in retail began about halfway through the previous year, with hopes for recovery as inflation decreases [80][82] Question: What is the comfort level regarding cash and potential investments in sales and marketing? - Management expressed confidence that there is no need to raise cash for operations and is assessing past marketing expenditures for better ROI [84][86] Question: Could you provide insights on retail volumes in Q3 and expectations for Q4? - Management noted a double-digit decline in retail transaction volumes in Q3 but remains hopeful for seasonal growth in Q4 due to new verticals coming online [90][91] Question: Clarification on the price per transaction increase and its implications? - Management clarified that the 25% year-over-year increase in price per transaction was specific to new business and not solely from existing customers [93] Question: What is the current size of the sales pipeline compared to previous quarters? - Management reported a more favorable pipeline today compared to three quarters ago, with ongoing discussions with large clients [95][96]

Company Performance - Intellicheck Mobilisa, Inc. reported a quarterly loss of $0.02 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.01, marking an earnings surprise of -100% [1] - The company posted revenues of $4.71 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 3.98%, compared to revenues of $4.76 million a year ago [2] - Over the last four quarters, Intellicheck Mobilisa has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - Intellicheck Mobilisa shares have increased by approximately 42.6% since the beginning of the year, outperforming the S&P 500's gain of 25.5% [3] - The current consensus EPS estimate for the upcoming quarter is $0.01 on revenues of $5.41 million, while for the current fiscal year, the estimate is -$0.03 on revenues of $19.67 million [7] Industry Outlook - The Security and Safety Services industry, to which Intellicheck Mobilisa belongs, is currently ranked in the top 34% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5]

Financial Performance - Total revenue for Q3 2024 was $4,709,000, relatively flat compared to $4,760,000 in Q3 2023[1] - SaaS revenue increased by 1% to $4,661,000 in Q3 2024 from $4,635,000 in Q3 2023[1] - Gross profit margin remained strong at 91% for both Q3 2024 and Q3 2023[2] - Operating expenses decreased by 1% to $5,195,000 in Q3 2024 from $5,227,000 in Q3 2023[3] - Net loss for Q3 2024 increased to ($837,000) or ($0.04) per diluted share, compared to a net loss of ($724,000) or ($0.04) per diluted share in Q3 2023[4] - Adjusted EBITDA improved by $104,000 to a loss of ($167,000) in Q3 2024 compared to a loss of ($271,000) in Q3 2023[5] - For the nine months ended September 30, 2024, the net loss was $1,406,000, compared to a net loss of $2,964,000 for the same period in 2023, representing a 52.7% improvement[17] - Adjusted EBITDA for the nine months ended September 30, 2024, was $(341,000), compared to $(793,000) for the same period in 2023, indicating a 57.0% reduction in losses[20] Cash and Assets - As of September 30, 2024, cash and cash equivalents totaled $5.7 million, and stockholders' equity was $16.7 million[6] - Total assets decreased to $20,682,000 as of September 30, 2024, down from $23,808,000 at the end of 2023[9] - The company reported a cash balance of $5,747,000 at the end of the period, up from $3,962,000 at the end of the same period in 2023, marking a 45.0% increase[17] - The decrease in accounts receivable was $1,360,000 for the nine months ended September 30, 2024, compared to an increase of $1,284,000 in the same period of 2023, indicating improved cash collection[17] - The company experienced a decrease in accounts payable and accrued expenses by $1,493,000 for the nine months ended September 30, 2024, compared to an increase of $431,000 in the same period of 2023[17] Operating Activities - Cash flows from operating activities showed a net cash used of $1,373,000 for the nine months ended September 30, 2024, compared to $1,114,000 for the same period in 2023, reflecting a 23.3% increase in cash outflow[17] - The company incurred $1,833,000 in software development costs during the nine months ended September 30, 2024, with no comparable costs reported in the previous year[17] Strategic Focus - The company is focused on revenue growth and expanding into new markets to drive sales and transaction volume[2] - The company is focused on expanding its digital identity validation solutions for various sectors, including financial services and law enforcement[21] - Future expectations include potential growth in commercial adoption of products and services, with a focus on new market areas such as healthcare and auto dealerships[22] Conference and Reporting - The earnings conference call was held on November 13, 2024, to discuss operating results[7] - The company reported a total stockholders' equity of $17,667,000 as of September 30, 2023[16]

Revenue Performance - Revenues for the three months ended June 30, 2024 decreased by $44, or 1%, to approximately $4,672 compared to $4,716 for the same period of 2023[102] - SaaS revenue for the three months ended June 30, 2024 decreased by $36, or 1%, to $4,627 compared to $4,663 for the same period of 2023[102] - Revenues for the six months ended June 30, 2024 increased by $382, or 4%, to approximately $9,352 compared to $8,970 for the same period of 2023[104] - SaaS revenue for the six months ended June 30, 2024 increased by $345, or 4%, to $9,236 compared to $8,891 for the same period of 2023[104] Profitability and Loss - Gross profit for the three months ended June 30, 2024 decreased by $136, or 3%, to $4,228, with a gross profit margin of 91% compared to 93% for the same period of 2023[102] - The net loss for the three months ended June 30, 2024 was $(127), an improvement compared to a net loss of $(853) for the same period of 2023[103] - The net loss for the six months ended June 30, 2024 was $(569), an improvement compared to a net loss of $(2,240) for the same period of 2023[105] - Net loss for the six months ended June 30, 2024, was $(569) million, an improvement from $(2,240) million in the same period of 2023[112] Operating Expenses - Operating expenses for the three months ended June 30, 2024 decreased by $770, or 15%, to $4,443 compared to $5,213 for the same period of 2023[103] - Operating expenses for the six months ended June 30, 2024 decreased by $1,318, or 13%, to $9,197 compared to $10,515 for the same period of 2023[105] Cash and Financial Position - As of June 30, 2024, the company had cash and cash equivalents of $7,260 and working capital of $6,611[106] Adjusted EBITDA and Other Financial Metrics - Adjusted EBITDA for the three months ended June 30, 2024, was $(70) million, compared to $(174) million for the same period in 2023[112] - Depreciation and amortization for the three months ended June 30, 2024, was $73 million, compared to $69 million in the same period of 2023[112] - Stock-based compensation, including liability classified awards, was $72 million for the three months ended June 30, 2024, down from $323 million in the same period of 2023[112] - Interest and other income for the six months ended June 30, 2024, was $(157) million, compared to $(1) million in the same period of 2023[112] Off-Balance Sheet and Risk Information - The company has not entered into any off-balance sheet financing arrangements or established special purpose entities[113] - There are no guarantees of debt or commitments of other entities by the company[113] - The company has not disclosed any quantitative and qualitative market risk information as it is not applicable to smaller reporting companies[114]

Financial Data and Key Metrics Changes - Q2 2024 revenue decreased by 1% to $4.672 million compared to $4.716 million in Q2 2023 [31] - SaaS revenue for Q2 2024 decreased by 0.8% to $4.627 million from $4.663 million in the same period last year, representing 99% of total revenue [31] - Net income improved by $726,000 to a net loss of $127,000 for Q2 2024 compared to a net loss of $853,000 for Q2 2023 [33] - Adjusted EBITDA decreased by $106,000, resulting in a loss of $70,000 compared to a gain of $36,000 for the same period in 2023 [34] Business Line Data and Key Metrics Changes - SaaS revenues were $4.6 million, down $36,000 year-over-year [8] - Operating expenses decreased by $770,000 or 17% to $4.443 million for Q2 2024 compared to $5.213 million for Q2 2023 [32] - The average price per scan increased by 11% sequentially from Q1 to Q2 2024, indicating a positive trend in pricing strategy [10][58] Market Data and Key Metrics Changes - Retail sector saw a 16% year-over-year decline in volumes, with significant impacts from bankruptcies and store closures [44] - New customer acquisition in non-retail sectors is showing positive growth, helping to offset declines in the retail sector [50][56] - The electronics vertical and new categories like auto and title insurance are performing better, partially offsetting declines in traditional retail categories [11] Company Strategy and Development Direction - The company is diversifying its market presence beyond traditional retail to include sectors like title insurance, automotive, and background checks [11][21] - A focus on enhancing customer experience and account management through new leadership roles is expected to drive growth [13][14] - Continued investment in technology and product enhancements is planned to address evolving fraud tactics and improve service delivery [24][25] Management's Comments on Operating Environment and Future Outlook - Management highlighted the significant increase in identity theft and fraud, emphasizing the importance of their technology in combating these issues [5][6] - The economic environment is seen as a headwind, particularly affecting the retail sector, but diversification into other verticals is expected to provide growth opportunities [47][56] - Management remains optimistic about future growth, particularly if the economy improves, which could provide a tailwind for retail recovery [45][47] Other Important Information - The company completed a successful proof of concept with a large lease-to-own retail client and is expanding its services [17] - New technology initiatives, including a self-administration hub for clients, are set to launch in Q3 2024 [24] - The company is actively cultivating partnerships with hardware companies to enhance its service offerings [39] Q&A Session Summary Question: Retail customer usage and deployment - Management noted that retail customers are using solutions in fewer locations due to store closures and economic factors affecting consumer spending [42][43] Question: Year-over-year retail volume decline - Retail volumes are down approximately 16% year-over-year, with variations across different sectors [44] Question: Future SaaS revenue expectations - Management refrained from providing specific revenue guidance but indicated that other market verticals are accelerating, which may offset retail declines [55][56]