Identiv, Inc. Q2 FY2025 earnings call

Perform: Strengthening core channel business - Prioritizing higher margin opportunities with existing customers, expanding gross margins via Thailand transition, and focusing on NPD pipeline. Commercial team in place, sales pipeline up 33% in Q2 vs prior quarter, and marketing team completed 22 initiatives with 10 partners. ### Accelerate: Advancing growth initiatives - Expanding BLE technology platform and MCL manufacturing capabilities, targeting growth in health care and consumer/logistics high-value applications. Significant BLE projects in pipeline, including IFCO grocery supply chain project. Collaborations with InPlay, Wiliot, Novanta, and Tag-N-Trac. ### Transform: Driving business expansion via M&A - Evaluating strategic alternatives, strengthened Board with M&A expertise, and introduced new metrics to monitor progress like new sales pipeline conversion rate, NPD projects, etc.

In the second quarter of 2025, Identiv's revenue was $5 million, within the previously announced guidance. The core channel business remains on track but faces increased competition, particularly in standard product lines where competitors have expanded manufacturing capacity. Revenue in Q2 2025 was $5 million, compared to $6.7 million in Q2 2024. Gross margin in Q2 2025 was negative 9.4% (GAAP) and negative 0.8% (non-GAAP), impacted by production transition costs to Thailand and lower utilization.

For Q3 2025, net revenue is expected to be in the range of $4.8 million to $5.2 million. Revised net operating cash used range for the period ending September 30, 2025, is $13 million to $15 million, down from prior expectations of $14 million to $16 million.

• Macro risks related to U.S. trade with Thailand, including uncertainty around Thailand certificate of origin requirements and potential indirect effects on customer demand. - Competitive pressures on standard product lines due to increased manufacturing capacity from key competitors.

Q: Could you help us get a sense of the size of the opportunity in the grocery space with IFCO?

A: IFCO has over 400 million plastic containers to tag over the next 4-5 years, with ongoing replenishment opportunities. Pilot testing in 2025 with full-scale deployment in 2026.

Q: How are order patterns for Q3?

A: Order patterns seem to be on track with provided guidance.

Q: How should we think about gross margin in Q3 and Q4?

A: Gross margin will improve in Q3 and Q4 due to the closing of production in Singapore, which had been impacting margins with dual manufacturing sites earlier.