Mitek Reports Fiscal 2024 First Quarter Financial Results and Provides Preliminary Second Quarter Revenue Results
Company Reiterates Guidance for Fiscal 2024
Fiscal 2024 First Quarter Financial Results
-
Total revenue was
$36.9 million , compared to$45.7 million a year ago. -
GAAP operating loss was
$6.9 million , an operating margin of negative 19%, compared to GAAP operating income of$8.4 million , an operating margin of 18% a year ago. -
GAAP net loss was
$5.8 million , or negative$0.13 per diluted share, compared to GAAP net income of$4.7 million , or$0.10 per diluted share a year ago. -
Non-GAAP operating income was
$5.6 million and non-GAAP operating margin was 15%, compared to non-GAAP operating income of$18.4 million and a non-GAAP operating margin of 40% last year. -
Non-GAAP net income was
$6.3 million , or$0.14 per diluted share, compared to$14.3 million , or$0.31 per diluted share last year. -
Cash flow from operations was a negative
$9.5 million , driven by$7.8 million in cash taxes paid for FY2023 during the quarter and$4.6 million in cash paid for the final ID R&D earnout payment. -
Total cash and investments was
$123.9 million atDecember 31, 2023 , compared to$134.9 million onSeptember 30, 2023 .
Preliminary Fiscal 2024 Second Quarter Revenue Results
-
Mitek expects fiscal second quarter revenue to be in the range of
$46 million to$47 million .
The Company’s independent auditor has not reviewed or audited these preliminary estimated financial results. The Company’s actual results may differ materially from these preliminary financial results, and may be outside the estimated ranges. This preliminary financial data has been prepared by and is the responsibility of the Company. The Company has not fully completed its review of these preliminary financial results for the fiscal quarter endedMarch 31, 2024 .
Mitek CEO Max Carnecchia’s Comments
"As previously discussed, in the first quarter of last year we had a large one-time multi-year mobile deposit reorder that pulled forward about
Fiscal 2024 Full Year Guidance
Mitek is reiterating its previously provided guidance for its fiscal year ending
-
Mitek expects full-year revenue to be in the range of
$180.0 million to$185.0 million , a 6% growth rate at the midpoint of the range. In fiscal 2023, Mitek signed a large multi-year mobile deposit reorder with one customer that locked in favorable pricing over a four-year period. Due to the unique terms of this contract, Mitek recognized additional license revenue relating to future years of approximately$7.0 million in fiscal 2023. If the Company backs out the future year revenue of$7 million from its fiscal 2023 revenue and attributes the$2.7 million that would have been attributable to fiscal 2024 to the midpoint of the fiscal 2024 revenue guidance, it would represent growth of approximately 12.0% at the revised midpoint. - Mitek expects its non-GAAP operating margin for fiscal 2024 to be between 30.0% and 31.0%.
Conference Call Information
Mitek management will host a conference call and live webcast for analysts and investors today at
About
Mitek (NASDAQ: MITK) is a global leader in digital access, founded to bridge the physical and digital worlds. Mitek’s advanced identity verification technologies and global platform make digital access faster and more secure than ever, providing companies new levels of control, deployment ease and operation, while protecting the entire customer journey. Trusted by 99% of
Follow Mitek on LinkedIn, X and YouTube, and read Mitek’s latest blog posts here.
Notice Regarding Forward-Looking Statements
Statements contained in this news release relating to the Company or its management’s intentions, hopes, beliefs, expectations or predictions of the future, including, but not limited to, statements relating to the Company’s select preliminary revenue results for the second quarter ended
Additional risks and uncertainties faced by the Company are contained from time to time in the Company’s filings with the
Note Regarding Use of Non-GAAP Financial Measures
This news release contains non-
The Company has not provided a reconciliation of its forward outlook for non-GAAP operating margin with its forward-looking GAAP operating margin in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K.
|
|||||||
CONSOLIDATED BALANCE SHEETS |
|||||||
(Unaudited) |
|||||||
(amounts in thousands except share data) |
|||||||
|
|
|
|
||||
|
|
|
|
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
64,538 |
|
|
$ |
58,913 |
|
Short-term investments |
|
59,373 |
|
|
|
74,700 |
|
Accounts receivable, net |
|
35,267 |
|
|
|
32,132 |
|
Contract assets, current portion |
|
17,305 |
|
|
|
18,355 |
|
Prepaid expenses |
|
6,908 |
|
|
|
3,513 |
|
Other current assets |
|
2,573 |
|
|
|
2,396 |
|
Total current assets |
|
185,964 |
|
|
|
190,009 |
|
Long-term investments |
|
— |
|
|
|
1,304 |
|
Property and equipment, net |
|
2,695 |
|
|
|
2,829 |
|
Right-of-use assets |
|
3,837 |
|
|
|
4,140 |
|
|
|
190,837 |
|
|
|
188,222 |
|
Deferred income tax assets |
|
13,388 |
|
|
|
11,645 |
|
Contract assets, non-current portion |
|
7,216 |
|
|
|
5,579 |
|
Other non-current assets |
|
1,453 |
|
|
|
1,647 |
|
Total assets |
|
405,390 |
|
|
|
405,375 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
|
10,169 |
|
|
|
7,589 |
|
Accrued payroll and related taxes |
|
7,063 |
|
|
|
10,554 |
|
Accrued interest payable |
|
598 |
|
|
|
305 |
|
Income tax payables |
|
51 |
|
|
|
4,329 |
|
Deferred revenue, current portion |
|
18,330 |
|
|
|
17,360 |
|
Lease liabilities, current portion |
|
1,569 |
|
|
|
1,902 |
|
Acquisition-related contingent consideration |
|
— |
|
|
|
7,976 |
|
Other current liabilities |
|
1,820 |
|
|
|
1,482 |
|
Total current liabilities |
|
39,600 |
|
|
|
51,497 |
|
Convertible senior notes |
|
137,486 |
|
|
|
135,516 |
|
Deferred revenue, non-current portion |
|
1,051 |
|
|
|
957 |
|
Lease liabilities, non-current portion |
|
2,792 |
|
|
|
2,867 |
|
Deferred income tax liabilities, non-current portion |
|
6,757 |
|
|
|
6,476 |
|
Other non-current liabilities |
|
3,906 |
|
|
|
2,874 |
|
Total liabilities |
|
191,592 |
|
|
|
200,187 |
|
Stockholders’ equity: |
|
|
|
||||
Preferred stock, |
|
— |
|
|
|
— |
|
Common stock, |
|
47 |
|
|
|
46 |
|
Additional paid-in capital |
|
236,447 |
|
|
|
228,691 |
|
Accumulated other comprehensive loss |
|
(7,591 |
) |
|
|
(14,237 |
) |
Accumulated deficit |
|
(15,105 |
) |
|
|
(9,312 |
) |
Total stockholders’ equity |
|
213,798 |
|
|
|
205,188 |
|
Total liabilities and stockholders’ equity |
$ |
405,390 |
|
$ |
405,375 |
|
|
|
|
|
|
|
|
|||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(Unaudited) |
|||||||
(amounts in thousands except per share data) |
|||||||
|
|
|
|
||||
|
Three Months Ended |
||||||
|
|
2023 |
|
|
|
2022 |
|
Revenue |
|
|
|
||||
Software and hardware |
$ |
15,980 |
|
|
$ |
26,376 |
|
Services and other |
|
20,937 |
|
|
|
19,327 |
|
Total revenue |
|
36,917 |
|
|
|
45,703 |
|
Operating costs and expenses |
|
|
|
||||
Cost of revenue—software and hardware (exclusive of depreciation & amortization) |
|
40 |
|
|
|
169 |
|
Cost of revenue—services and other (exclusive of depreciation & amortization) |
|
5,494 |
|
|
|
4,900 |
|
Selling and marketing |
|
9,856 |
|
|
|
9,515 |
|
Research and development |
|
8,874 |
|
|
|
7,670 |
|
General and administrative |
|
15,538 |
|
|
|
8,479 |
|
Amortization and acquisition-related costs |
|
3,983 |
|
|
|
4,821 |
|
Restructuring costs |
|
48 |
|
|
|
1,776 |
|
Total operating costs and expenses |
|
43,833 |
|
|
|
37,330 |
|
Operating income (loss) |
|
(6,916 |
) |
|
|
8,373 |
|
Interest expense |
|
2,263 |
|
|
|
2,137 |
|
Other income, net |
|
1,642 |
|
|
|
336 |
|
Income (loss) before income taxes |
|
(7,537 |
) |
|
|
6,572 |
|
Income tax benefit (provision) |
|
1,744 |
|
|
|
(1,846 |
) |
Net income (loss) |
$ |
(5,793 |
) |
|
$ |
4,726 |
|
Net income (loss) per share—basic |
$ |
(0.13 |
) |
|
$ |
0.11 |
|
Net income (loss) per share—diluted |
$ |
(0.13 |
) |
|
$ |
0.10 |
|
Shares used in calculating net income (loss) per share—basic |
|
46,294 |
|
|
|
44,930 |
|
Shares used in calculating net income (loss) per share—diluted |
|
46,294 |
|
|
|
45,634 |
|
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(Unaudited) |
|||||||
(amounts in thousands) |
|||||||
|
Three Months Ended |
||||||
|
|
2023 |
|
|
|
2022 |
|
Operating activities: |
|
|
|
||||
Net income (loss) |
$ |
(5,793 |
) |
|
$ |
4,726 |
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|
|
|
||||
Stock-based compensation expense |
|
3,430 |
|
|
|
2,442 |
|
Amortization of intangible assets |
|
3,847 |
|
|
|
4,487 |
|
Depreciation and amortization |
|
391 |
|
|
|
343 |
|
Amortization of investment premiums & other |
|
(1,398 |
) |
|
|
13 |
|
Accretion and amortization on debt securities |
|
1,970 |
|
|
|
1,844 |
|
Net changes in estimated fair value of acquisition-related contingent consideration |
|
136 |
|
|
|
330 |
|
Deferred taxes |
|
(1,708 |
) |
|
|
(3,459 |
) |
Changes in assets and liabilities, net of acquisitions: |
|
|
|
||||
Accounts receivable |
|
(2,771 |
) |
|
|
58 |
|
Contract assets |
|
(511 |
) |
|
|
(5,507 |
) |
Other assets |
|
(3,192 |
) |
|
|
(154 |
) |
Accounts payable |
|
2,520 |
|
|
|
980 |
|
Accrued payroll and related taxes |
|
(3,704 |
) |
|
|
(4,174 |
) |
Income taxes payable |
|
(4,254 |
) |
|
|
5,149 |
|
Deferred revenue |
|
857 |
|
|
|
(1,521 |
) |
Restructuring accrual |
|
— |
|
|
|
(651 |
) |
Other liabilities |
|
717 |
|
|
|
354 |
|
Net cash provided by (used in) operating activities |
|
(9,463 |
) |
|
|
5,260 |
|
Investing activities: |
|
|
|
||||
Purchases of investments |
|
(14,991 |
) |
|
|
— |
|
Sales and maturities of investments |
|
33,121 |
|
|
|
18,750 |
|
Purchases of property and equipment, net |
|
(241 |
) |
|
|
(154 |
) |
Net cash provided by (used in) investing activities |
|
17,889 |
|
|
|
18,596 |
|
Financing activities: |
|
|
|
||||
Proceeds from the issuance of equity plan common stock |
|
856 |
|
|
|
662 |
|
Payment of acquisition-related contingent consideration |
|
(4,641 |
) |
|
|
— |
|
Proceeds from other borrowings |
|
707 |
|
|
|
— |
|
Principal payments on other borrowings |
|
(36 |
) |
|
|
(36 |
) |
Net cash provided by (used in) financing activities |
|
(3,114 |
) |
|
|
626 |
|
Foreign currency effect on cash and cash equivalents |
|
313 |
|
|
|
574 |
|
Net increase in cash and cash equivalents |
|
5,625 |
|
|
|
25,056 |
|
Cash and cash equivalents at beginning of period |
|
58,913 |
|
|
|
32,059 |
|
Cash and cash equivalents at end of period |
$ |
64,538 |
|
|
$ |
57,115 |
|
|
|||||
DISAGGREGATION OF REVENUE |
|||||
(Unaudited) |
|||||
(amounts in thousands) |
|||||
|
Three Months Ended |
||||
|
|
2023 |
|
|
2022 |
Major product category |
|
|
|
||
Deposits software and hardware |
$ |
14,048 |
|
$ |
24,453 |
Deposits services and other |
|
7,029 |
|
|
5,828 |
Deposits revenue |
|
21,077 |
|
|
30,281 |
Identity verification software and hardware |
|
1,932 |
|
|
1,923 |
Identity verification services and other |
|
13,908 |
|
|
13,499 |
Identity verification revenue |
|
15,840 |
|
|
15,422 |
Total revenue |
$ |
36,917 |
|
$ |
45,703 |
|
|||||||
NON-GAAP NET INCOME RECONCILIATION |
|||||||
(Unaudited) |
|||||||
(amounts in thousands except per share data) |
|||||||
|
Three Months Ended |
||||||
|
|
2023 |
|
|
|
2022 |
|
Net income (loss) |
$ |
(5,793 |
) |
|
$ |
4,726 |
|
Non-GAAP adjustments: |
|
|
|
||||
Acquisition-related costs and expenses |
|
3,984 |
|
|
|
4,821 |
|
Litigation and other legal costs |
|
2,169 |
|
|
|
253 |
|
Executive transition costs |
|
209 |
|
|
|
— |
|
Stock compensation expense |
|
3,430 |
|
|
|
2,442 |
|
Non-recurring audit fees |
|
1,638 |
|
|
|
740 |
|
Enterprise risk, portfolio positioning and other related costs |
|
996 |
|
|
|
— |
|
Restructuring costs |
|
48 |
|
|
|
1,776 |
|
Amortization of debt discount and issuance costs |
|
1,970 |
|
|
|
1,844 |
|
Income tax effect of pre-tax adjustments |
|
(2,967 |
) |
|
|
(2,992 |
) |
Cash tax difference(1) |
|
641 |
|
|
|
662 |
|
Non-GAAP net income |
$ |
6,325 |
|
|
$ |
14,272 |
|
Non-GAAP income per share—basic |
$ |
0.14 |
|
|
$ |
0.32 |
|
Non-GAAP income per share—diluted |
$ |
0.14 |
|
|
$ |
0.31 |
|
Shares used in calculating non-GAAP net income per share—basic |
|
46,294 |
|
|
|
44,930 |
|
Shares used in calculating non-GAAP net income per share—diluted |
|
46,294 |
|
|
|
45,634 |
(1) |
The Company’s non-GAAP net income is calculated using a cash tax rate of 13% in fiscal 2024 and 24% in fiscal 2023. The estimated cash tax rate is the estimated annual tax payable on the Company’s tax returns as a percentage of estimated annual non-GAAP pre-tax net income. The Company uses an estimated cash tax rate to adjust for the historical variation in the effective book tax rate associated with the reversal of valuation allowances, and the utilization of research and development tax credits which currently have an overall effect of reducing taxes payable. The Company believes that the cash tax rate provides a more transparent view of the Company’s operating results. The Company’s effective tax rate used for the purposes of calculating GAAP net income for fiscal 2024 and 2023 was 23% and 28%, respectively. |
|
|||||||
NON-GAAP OPERATING INCOME RECONCILIATION |
|||||||
(Unaudited) |
|||||||
(amounts in thousands) |
|||||||
|
Three Months Ended |
||||||
|
|
2023 |
|
|
|
2022 |
|
GAAP operating income |
$ |
(6,916 |
) |
|
$ |
8,373 |
|
Non-GAAP adjustments: |
|
|
|
||||
Acquisition-related costs and expenses |
|
3,984 |
|
|
|
4,821 |
|
Litigation and other legal costs |
|
2,169 |
|
|
|
253 |
|
Executive transition costs |
|
209 |
|
|
|
— |
|
Stock compensation expense |
|
3,430 |
|
|
|
2,442 |
|
Non-recurring audit fees |
|
1,638 |
|
|
|
740 |
|
Enterprise risk, portfolio positioning and other related costs |
|
996 |
|
|
|
— |
|
Restructuring costs |
|
48 |
|
|
|
1,776 |
|
Non-GAAP operating income |
$ |
5,558 |
|
|
$ |
18,405 |
|
|
|
|
|
||||
Total Revenue |
$ |
36,917 |
|
|
$ |
45,703 |
|
Non-GAAP operating margin |
|
15 |
% |
|
|
40 |
% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240415818276/en/
Investor Contact:
MKR Investor Relations, Inc.
mitk@mkr-group.com
Source: