Core Viewpoint - VerifyMe, Inc. has announced an extension of its share repurchase plan, allowing the company to buy back up to $500,000 of its common stock until December 31, 2025, as market conditions permit [2][3]. Company Overview - VerifyMe, Inc. provides brand protection and enhancement solutions, operating in two segments: Authentication and Precision Logistics, focusing on anti-counterfeit and specialized logistics for time and temperature-sensitive products [4]. Share Repurchase Plan - The Board has approved the extension of the 2024 Share Repurchase Authorization to December 31, 2025, allowing for the repurchase of shares based on market conditions and legal considerations [2]. - The repurchase plan is flexible, with no obligation to acquire a specific number of shares, and can be modified or suspended at the Board's discretion [2]. - Repurchases will be funded from cash generated from operations, ensuring sufficient liquidity for strategic growth initiatives [2]. Management Commentary - The President and CEO of VerifyMe expressed satisfaction with operational efficiencies and highlighted the potential for delivering shareholder value through both organic and strategic initiatives [3]. - The company aims to maintain all capital allocation options to optimize short and long-term shareholder value creation [3].

Financial Data and Key Metrics Changes - The third quarter revenue was $5.4 million, a decrease of $0.2 million from $5.6 million in the prior year [22] - Gross profit decreased by $0.2 million to $1.9 million in Q3 2024, with a gross margin of 35% compared to 37% in Q3 2023 [23] - The net loss for the quarter was $2.4 million, or a loss of $0.23 per diluted share, while adjusted EBITDA remained flat year-over-year at $0.2 million [28] Business Line Data and Key Metrics Changes - Revenue in the Authentication segment was down slightly year-over-year, while in the Precision Logistics segment, premium revenue decreased by $0.5 million due to discontinued contracts, partially offset by a $0.4 million increase in proactive services revenue [22] - The Precision Logistics segment saw a 6% increase in proactive services customers year-to-date compared to 2023 [20] Market Data and Key Metrics Changes - The company anticipates that 2024 revenue will be slightly below 2023 revenue, primarily due to the loss of a premium customer and lack of growth in the Authentication segment [8][9] - The company has identified that the Authentication segment lacks the size and scope to compete effectively in the enterprise customer market [13] Company Strategy and Development Direction - The company plans to exit the code portion of the Authentication segment and focus on its ink product, which currently represents about 23% of Authentication revenue [16] - A renewed focus on the ink product and exploring other strategic opportunities is expected to provide better returns for shareholders [19] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the lack of revenue growth in 2024 and acknowledged the challenges faced in the Authentication segment [8][9] - The company remains optimistic about the Precision Logistics business and believes it can create value through organic and strategic initiatives [18] Other Important Information - The company recorded a $2.3 million goodwill and intangible asset impairment due to the analysis of its competitive positioning in the Authentication segment [25] - Cash as of September 30, 2024, was $2.6 million, a decrease from $3.1 million at the end of 2023 [29] Q&A Session Summary Question: Is the remaining Authentication business adjusted EBITDA positive or negative? - The remaining Authentication business is currently adjusted EBITDA negative, but there is hope to achieve adjusted EBITDA positive status in 2025 [34] Question: Does it make sense for the Authentication segment to exist given its small contribution to revenue? - Management acknowledged the question and indicated that they are evaluating the future of the segment, considering its low revenue contribution [36][37] Question: What is the outlook for the premium business after the FedEx decision? - Management reported growth in direct premium customers and stable activity in the pipeline, indicating a positive outlook for this aspect of the business [42] Question: What pieces of the Authentication business are still in play? - Currently, the ink component and related patents and technology are in play, with a focus on partnerships that could create value [47] Question: Will there be revenue from the Authentication segment in 2025? - Management expects some revenue from the Authentication segment in 2025, but it will not be material for the company as a whole [49] Question: What is the mix of proactive services revenue? - Approximately 80% of the revenue comes from proactive services, with 20% from premium services [50] Question: What are the expectations for gross margin in the upcoming year? - Management does not anticipate a year-over-year gross margin uplift due to the shift in revenue mix towards lower-margin proactive services [56]

Revenue and Financial Performance - Revenue for the three months ended September 30, 2024, was $5,435 thousand, compared to $5,604 thousand in the same period in 2023, with Proactive services contributing $4,417 thousand and Premium services contributing $886 thousand[45] - For the nine months ended September 30, 2024, total revenue was $16,546 thousand, compared to $16,600 thousand in 2023, with Proactive services contributing $12,587 thousand and Premium services contributing $3,574 thousand[46] - Consolidated revenue decreased by $169 thousand in Q3 2024 compared to Q3 2023, with Precision Logistics segment accounting for 98% of total revenue[136] - For the nine months ended September 30, 2024, consolidated revenue decreased by $54 thousand compared to the same period in 2023[145] - Precision Logistics segment revenue for September 2024 was $5.303 million, a decrease of 2.8% compared to $5.457 million in September 2023[110] - Authentication segment revenue for September 2024 was $132,000, a decrease of 10.2% compared to $147,000 in September 2023[110] - Total revenue for September 2024 was $5.435 million, a decrease of 3.0% compared to $5.604 million in September 2023[110] - Proactive services revenue in Precision Logistics grew 9% in Q3 2024 compared to Q3 2023[136] Gross Profit and Margins - Gross profit for Q3 2024 was $1,895 thousand, a decrease from $2,046 thousand in Q3 2023, with gross margin declining from 37% to 35%[137] - Gross profit for the nine months ended September 30, 2024, was $6,245 thousand, an increase from $5,153 thousand in the same period of 2023, with gross margin improving from 31% to 38%[146] - Precision Logistics gross profit for September 2024 was $1.777 million, a decrease of 6.9% compared to $1.909 million in September 2023[110] - Authentication gross profit for September 2024 was $118,000, a decrease of 13.9% compared to $137,000 in September 2023[110] - Total gross profit for September 2024 was $1.895 million, a decrease of 7.4% compared to $2.046 million in September 2023[110] Net Loss and Impairments - Net loss for September 2024 was $2.424 million, compared to a net loss of $930,000 in September 2023[110] - Consolidated net loss for Q3 2024 was $2,424 thousand, compared to $930 thousand in Q3 2023[143] - The company recorded a goodwill impairment charge of $1,351 thousand for the Authentication segment during the three and nine months ended September 30, 2024[169] - The company recorded an intangible impairment charge of $901 thousand for certain intangible assets during the three months ended September 30, 2024[171] - Goodwill impairment charge of $1,351 thousand was recorded for the Authentication segment during the three and nine months ended September 30, 2024, due to a triggering event indicating potential impairment[60][62] - Intangible asset impairment charges of $901 thousand and $914 thousand were recorded during the three and nine months ended September 30, 2024, respectively, due to revisions in internal forecasts[65] - The company impaired certain assets by $914 thousand during the nine months ended September 30, 2024, bringing the gross carrying amount related to these assets to zero[66] Cash and Debt - As of September 30, 2024, the company held $2.61 million in cash and cash equivalents, with no restricted cash, compared to $3.095 million in total cash and cash equivalents including $63,000 in restricted cash as of December 31, 2023[22] - The company's cash provided by operating activities was $302 thousand for the nine months ended September 30, 2024, compared to cash used by operating activities of $599 thousand in the same period of 2023[155] - The company's short-term debt outstanding under the Term Note was $0.5 million and total long-term debt outstanding under the Term Note was $0.5 million as of September 30, 2024[93] - The company repaid $375 thousand towards the principal of the outstanding Term Note during the nine months ended September 30, 2024[93] - The company entered into a Convertible Note Purchase Agreement for $1,100 thousand in August 2023, with $450 thousand held by related parties as of September 30, 2024[158] - The PNC Facility includes a $1 million RLOC extended to September 30, 2025, and a $2 million Term Note maturing in September 2026[159][160] - The company used $1.8 million of the $2.0 million proceeds from the Term Note to settle debt related to the PeriShip Global acquisition, including redeeming 61,000 shares of common stock[162] - The company entered into an interest rate swap agreement with a notional amount of $1,958 thousand, fixing the interest rate on outstanding debt at 7.602%[163] - The company's cash and cash equivalents are expected to fund operations for the next 12 months, with potential for additional debt or equity issuance to support growth[165] Stock and Share-Based Compensation - For the three and nine months ended September 30, 2024, there were approximately 8,256,000 anti-dilutive shares, including 2,305,000 unvested performance restricted stock units and 4,629,000 shares issuable upon exercise of warrants[40] - The company accounts for stock-based compensation using the Black-Scholes model for stock options and a lattice approach with Monte Carlo simulation for performance restricted stock units[42] - Stock-based compensation awards to non-employees are accounted for under ASU No. 2018-07, aligning with employee share-based payment accounting[43] - The company expensed $345 thousand related to restricted stock units for the three months ended September 30, 2024, and $678 thousand for the nine months ended September 30, 2024[70] - The company issued 1,750 shares of common stock upon vesting of restricted stock units and 38,095 shares of common stock from treasury shares during the nine months ended September 30, 2024[70] - The company repurchased 1,000 shares of common stock for $1 thousand under its share repurchase program during the nine months ended September 30, 2024[74] - The company had 270,367 shares held in treasury with a value of approximately $464 thousand as of September 30, 2024[73] - The company had 221,000 stock options outstanding with a weighted-average exercise price of $3.57 as of September 30, 2024[82] - Total unrecognized share-based compensation cost related to unvested restricted stock awards is $152 thousand as of September 30, 2024[84] - Unvested time-based restricted stock units as of September 30, 2024, totaled 363,403 shares with an average weighted grant date fair value of $1.35[85] - Total unrecognized share-based compensation cost related to unvested time-based restricted stock units was $198 thousand, expected to be recognized over less than one year[85] - Unvested performance-based restricted stock units as of September 30, 2024, totaled 1,801,660 shares with a weighted average grant date fair value of $1.35[87] - Total unrecognized share-based compensation cost related to unvested performance-based restricted stock units was $960 thousand, expected to be recognized over 1.2 years[88] - The company's warrants as of September 30, 2024, totaled 4,628,586 shares with a weighted average exercise price of $4.13 and a remaining contractual term of 1.5 years[89] - The company repurchased 1,000 shares of common stock for $1 thousand under a $0.5 million share repurchase program approved in December 2023[164] Intangible Assets and Goodwill - The company's intangible assets include patents, trademarks, customer relationships, and developed technology, with amortization periods ranging from 8 to 18 years[55][64] - The company's goodwill and intangible assets are tested for impairment annually or when triggering events occur, with significant judgment involved in determining fair value[58][59] - Intangible assets with finite lives totaled $7,730 thousand as of September 30, 2024, with a net carrying amount of $5,523 thousand after amortization[66] - Amortization expense for intangible assets was $277 thousand for the three months ended September 30, 2024, and $817 thousand for the nine months ended September 30, 2024[66] - The company expects to record amortization expense of intangible assets totaling $5,523 thousand over the next 5 years and thereafter[68] Foreign Currency and Derivatives - Foreign currency transaction gains for the three and nine months ended September 30, 2024, were $67,000 and $21,000 respectively, compared to losses of $16,000 and $30,000 for the same periods in 2023[24] - The company's fair value hierarchy shows a derivative asset (Level 2) of $11,000 and contingent consideration (Level 3) of ($22,000) as of September 30, 2024, compared to $4,000 and ($924,000) respectively as of December 31, 2023[29] Contracts and Customer Concentration - The Precision Logistics segment consists of Proactive and Premium service lines, with payment terms ranging from 7-30 days for Proactive and 30-45 days for Premium services[34] - Revenue in the Precision Logistics segment is recognized upon package delivery, with transaction fees consisting solely of fixed consideration[35] - The Authentication segment's revenue is recognized upon product shipment or delivery, with payment terms typically ranging between 30 and 90 days[36] - One customer represented 14% of revenues for the three months ended September 30, 2024, and one customer represented 23% of revenues for the same period in 2023[105] - Two customers made up 38% of accounts receivable as of September 30, 2024[105] Acquisitions and Contingent Consideration - The company acquired Trust Codes Global Limited on March 1, 2023, for a total purchase price of $2.113 million, including $363 thousand in cash, $625 thousand in stock, and $1.125 million in contingent consideration[52][54] - The company recognized $278 thousand in acquisition-related costs for the Trust Codes Global acquisition, included in General and administrative expenses for the nine months ended September 30, 2023[52] - Contingent consideration liabilities totaled $22 thousand as of September 30, 2024, with a payment of $36 thousand made on May 15, 2024[57] - The company plans to close the Trust Codes Global business by the end of November 2024 unless a purchaser is found[111] Operating Leases and Other Expenses - The company's operating lease cost for the nine months ended September 30, 2024, was $145 thousand, compared to $132 thousand for the same period in 2023[102] Partnerships and Strategic Alliances - The Precision Logistics segment has a direct partnership with a major global carrier company, providing detailed information and predictive analytics on shipments[129] - The Authentication segment has a contract with HP Indigo and a strategic partnership with INX, the third largest producer of inks in North America[130] Contract Assets and Liabilities - Contract assets increased by $6,464 thousand during the nine months ended September 30, 2024, with an ending balance of $786 thousand[50]

Core Viewpoint - VerifyMe, Inc. reported a quarterly loss of $0.06 per share, which was better than the Zacks Consensus Estimate of a loss of $0.09, representing an earnings surprise of 33.33% [1] - The company posted revenues of $5.44 million for the quarter ended September 2024, slightly missing the Zacks Consensus Estimate by 0.46% and down from $5.6 million a year ago [2] Group 1: Earnings Performance - VerifyMe has surpassed consensus EPS estimates three times over the last four quarters [2] - The company had a loss of $0.03 per share in the previous quarter, compared to an expected loss of $0.06, delivering a surprise of 50% [1] Group 2: Stock Performance - VerifyMe shares have increased by approximately 11.6% since the beginning of the year, while the S&P 500 has gained 25.8% [3] - The current Zacks Rank for VerifyMe is 3 (Hold), indicating expected performance in line with the market in the near future [6] Group 3: Future Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.01 on revenues of $8.63 million, and -$0.19 on revenues of $25.2 million for the current fiscal year [7] - The estimate revisions trend for VerifyMe is mixed, which could change following the recent earnings report [6] Group 4: Industry Context - The Technology Services industry, to which VerifyMe belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Revenue and Profit - Q3 2024 revenue was $5.4 million, a decrease of $0.2 million compared to Q3 2023[2][4][5] - Gross profit in Q3 2024 was $1.9 million, with a gross margin of 35%, down from 37% in Q3 2023[2][4][6] - Net revenue for the nine months ended September 30, 2024, was $16.5 million, compared to $16.6 million for the same period in 2023[24] - Gross profit for the nine months ended September 30, 2024, increased to $6.2 million from $5.2 million in the same period in 2023[24] Net Loss and Operating Loss - Net loss in Q3 2024 was ($2.4) million, including $1.8 million in one-time adjustments, compared to a net loss of ($0.9) million in Q3 2023[2][4][8] - Operating loss in Q3 2024 was ($2.9) million, primarily due to $2.3 million in goodwill and intangible asset impairments in the Authentication segment[7] - Net loss for the nine months ended September 30, 2024, was $3.3 million, compared to $3.4 million for the same period in 2023[24] - Goodwill and intangible asset impairment for the nine months ended September 30, 2024, was $2.3 million, compared to $34 thousand in the same period in 2023[24] Adjusted EBITDA - Adjusted EBITDA in Q3 2024 was $0.2 million, consistent with Q3 2023[2][4][9] - The company projects positive Adjusted EBITDA for the full year 2024 and expects Adjusted EBITDA growth in 2025 compared to 2024[3][10] - Total adjusted EBITDA (Non-GAAP) for the nine months ended September 30, 2024, was $441 thousand, compared to a loss of $695 thousand in the same period in 2023[27] Segment Performance - Precision Logistics segment accounted for 98% of Q3 2024 revenue, with Proactive services revenue growing 9% compared to Q3 2023[5] - The company decided to discontinue the codes portion of the Authentication Segment, redirecting investment into Precision Logistics and other strategic growth options[3][10] Cash and Financial Position - Cash balance as of September 30, 2024, was $2.6 million, with $2.1 million in working capital[11] - Cash and cash equivalents including restricted cash decreased from $3.1 million as of December 31, 2023, to $2.6 million as of September 30, 2024[21] - Accounts receivable decreased from $3.0 million as of December 31, 2023, to $1.2 million as of September 30, 2024[21] - Total liabilities decreased from $8.2 million as of December 31, 2023, to $4.5 million as of September 30, 2024[21] - Total assets decreased from $20.7 million as of December 31, 2023, to $14.8 million as of September 30, 2024[21] Operating Expenses - Total operating expenses for the nine months ended September 30, 2024, were $10.3 million, up from $8.6 million in the same period in 2023[24] Strategic Initiatives - The company has engaged with bankers and advisors regarding strategic growth opportunities[10]

Core Insights - VerifyMe, Inc. reported a quarterly revenue of $5.4 million for Q3 2024, a decrease from $5.6 million in Q3 2023, indicating a decline in overall sales performance [1][3][4] - The company experienced a net loss of $2.4 million in Q3 2024, which includes $1.8 million of one-time adjustments, compared to a net loss of $0.9 million in Q3 2023 [1][7] - Adjusted EBITDA remained stable at $0.2 million for both Q3 2024 and Q3 2023, marking the fifth consecutive quarter of positive adjusted EBITDA [2][8][9] Financial Performance - Revenue for Q3 2024 was $5.4 million, down by $0.2 million from Q3 2023, with the Precision Logistics segment accounting for 98% of total revenue [3][4] - Gross profit for Q3 2024 was $1.9 million, representing a gross margin of 35%, compared to a gross profit of $2.0 million and a margin of 37% in Q3 2023 [1][5] - The operating loss increased to $2.9 million in Q3 2024, primarily due to $2.3 million in goodwill and intangible asset impairments in the Authentication segment [6][7] Strategic Decisions - The CEO announced a strategic shift to discontinue the codes portion of the Authentication Segment, redirecting investments towards Precision Logistics and other growth opportunities [2][9] - The company is optimistic about the growth potential in its Proactive services within the Precision Logistics segment, which saw a 9% revenue increase compared to Q3 2023 [4][5] Cash Position - As of September 30, 2024, VerifyMe had a cash balance of $2.6 million and $2.1 million in working capital, indicating a stable liquidity position [9][10]

Company Overview - VerifyMe, Inc. (NASDAQ: VRME) provides brand owners with logistics, supply chain traceability, authentication, anti-counterfeiting, and data-rich brand enhancement services through its subsidiaries, Trust Codes Global and PeriShip Global [1][3] - The company operates in two segments: Precision Logistics and Authentication, focusing on time-and-temperature sensitive products and item-level traceability [3] Financial Results Announcement - VerifyMe will release its financial results for the third quarter ended September 30, 2024, on November 12, 2024 [1] - An investor conference call and webcast is scheduled for the same day at 11:00 a.m. Eastern Time, which will include prepared remarks and a Q&A session with the executive management team [1][2] Accessing the Conference Call - The conference call can be accessed via a webcast link or by calling designated numbers for US and international participants [2] - Presentation slides will be available on the Investors section of VerifyMe's website on the morning of the call, and the webcast will be archived for 90 days [2]

VerifyMe, Inc. (NASDAQ:VRME) Q2 2024 Earnings Conference Call August 13, 2024 11:00 AM ET Company Participants Nancy Meyers - CFO Adam Stedham - CEO Conference Call Participants Jack Vander Aarde - Maxim Group Michael Petusky - Barrington Research Operator Good day, and welcome to the VerifyMe Second Quarter 2024 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instruc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark one) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-39332 VERIFYME, INC. (Exact Name of Registrant as Specified in Its Charter) Nevada 23-3023677 (State or Other Jurisdiction of Inc ...

VerifyMe, Inc. (VRME) came out with a quarterly loss of $0.03 per share versus the Zacks Consensus Estimate of a loss of $0.06. This compares to loss of $0.11 per share a year ago. These figures are adjusted for nonrecurring items. This quarterly report represents an earnings surprise of 50%. A quarter ago, it was expected that this company would post a loss of $0.06 per share when it actually produced a loss of $0.05, delivering a surprise of 16.67%. Over the last four quarters, the company has surpassed c ...