Aware Inc (AWRE) Q3 2024 Earnings Call Highlights: Navigating Revenue Challenges with Strategic ...

GuruFocus News
4 min read

In This Article:

  • Total Revenue: $3.8 million, down from $6.4 million in Q3 2023.

  • Recurring Revenue: Increased 29% year over year to $2.8 million.

  • Operating Expenses: Reduced to $5.3 million, down 6% from $5.6 million in Q3 2023.

  • Operating Loss: $1.2 million, compared to operating income of $1.1 million in Q3 2023.

  • GAAP Net Loss: $1.2 million or 5 per diluted share, compared to GAAP net income of $1.1 million in Q3 2023.

  • Adjusted EBITDA Loss: $1.1 million, compared to an adjusted EBITDA gain of $400,000 in Q3 2023.

  • Cash, Cash Equivalents, and Marketable Securities: $27.4 million as of September 30, 2024.

Release Date: October 30, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Aware Inc (NASDAQ:AWRE) reported a 29% year-over-year growth in recurring revenue, strengthening its foundation for sustainable long-term growth.

  • The company secured a $1 million booking with a European government, showcasing the effectiveness of its enhanced biometric orchestration and identity management platform.

  • Aware Inc (NASDAQ:AWRE) successfully reduced operating expenses by $1.3 million in the first nine months of 2024 compared to 2023, demonstrating effective cost management.

  • The launch of Aware ID as a no-code plug-in on the WordPress marketplace significantly expands the company's reach, enabling businesses to adopt secure cloud-based biometric authentication.

  • The company expanded its ABIS portfolio by securing two new term contracts and added another ABIS account in Q4, reinforcing its commitment to delivering cutting-edge solutions.

Negative Points

  • Total revenue for Q3 2024 decreased to $3.8 million from $6.4 million in Q3 2023, primarily due to lower software license revenue.

  • Operating loss for Q3 2024 was $1.2 million, compared to an operating income of $1.1 million in the same period last year.

  • The company experienced delays in closing some larger deals, pushing them to Q4 or early Q1 of the next year.

  • Net loss for the nine months ended September 30, 2024, was $3.2 million, consistent with the net loss of $3.1 million in the prior year.

  • Aware Inc (NASDAQ:AWRE) anticipates approximately $900,000 of one-time expenses in Q4 related to the CEO transition and hiring of an executive strategic adviser.

Q & A Highlights

Q: What do you anticipate your run rate revenue will be by year end? A: David Traverse, Principal Financial Officer, Treasurer: We are on track to achieve double-digit revenue growth in 2024. This, along with seven new contracts and expanding partnerships across sectors like access control and digital education, sets us up for a strong recurring base in 2025.

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