authID Inc. Q1 FY2025 earnings call

• CEO Rhon Daguro highlighted authID's growth prospects in the biometric authentication market, with progress on ambitious 2025 goals. - Made progress with Fortune 500 and 100 customers, including entering contract negotiations with a large global Fortune 500 prospect and a paid live production trial with a global Fortune 100 retailer. - In final stages with a global Fortune 100 biometric hardware provider for joint product development. - Confirmed as selected vendor by a large identity fraud platform and in contract negotiations. - Developed new opportunities like integrating with blockchain-based data privacy platform and accelerating efforts in public sector. - Strategic bets on PrivacyKey (biometric authentication without storing biometric info) and interoperable solutions on ADIA standard. - Earned Best ID Management Platform in 2025 FinTech Breakthrough Awards. - Completed two capital raises in April and May, improving balance sheet and broadening investor base.

Total revenue for Q1 2025 was approximately $0.3 million, up from $0.16 million in the same period last year. Operating expenses were $4.7 million, higher than $3.3 million last year. Net loss was $4.3 million. Remaining performance obligation (RPO) as of March 31, 2025, was $13.85 million, a decrease of $0.41 million from the prior quarter. Adjusted EBITDA loss was $3.9 million for Q1, up from $2.4 million in the same period last year. Annual recurring revenue (ARR) as of Q1 was $1.2 million, compared to $0.6 million in Q1 2024. Gross booked annual recurring revenue (bARR) in Q1 2025 was $0.01 million, down from $0.10 million in the same period last year, due to delays in the sales process for certain deals.

• Target of $18 million in bookings for 2025. - Expect Q2025 bookings to revert to average with approximately 50% of gross bARR being contractually committed annual recurring revenue (cARR). - Deals in pipeline expected to contribute to 2025 full year bookings target despite Q1 delay.

• Market uncertainty could impact business. - Economic outlook uncertainty affecting sales process for certain deals. - Risks associated with forward-looking statements, including actual results differing materially from expectations.

Q: Can you talk about when you’re going to start seeing leverage from partnerships?

A: Bookings will come as they've invested in the channel and partners, with existing partnerships bringing authID into Indian banking, employment agencies, etc., and upcoming partnerships with fraud platforms and Fortune 500 biometric hardware provider.

Q: Why have expenses been so high ahead of revenue?

A: Expenses driven by investments in headcount for sales and R&D to support growth and handle large enterprise and partnership deals. As closing big customers requires training and supporting larger teams, investments are necessary.

Q: How many Fortune 500 clients needed to reach $18 million bookings target?

A: One potential deal could cover the whole $18 million, with FAT 100 deals being large (at least $1 million and above) and partnerships helping access many customers.

Q: What's the demand pull for biometrics right now?

A: Rise in demand due to building pipeline at a faster rate. Adoption of PrivacyKey (biometric authentication without storing biometrics using public-private key) has attracted attention, as it aligns with technical teams' familiarity with public key and private key technology.