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First Nine Month 2021 Financial Results
Revenue for the nine months ended September 30, 2021 was $12.9 million, compared to a $7.9 million in the same year-ago period. The increase in revenue was primarily due to higher software license revenue from our fixed fee contracts as well as higher subscription-based revenue related to an increase in transaction volume from new and existing customers.
Net loss for the nine months ended September 30, 2021 was $4.6 million, or $(0.21) per diluted share, which compares to a net loss of $6.0 million, or $(0.28) per diluted share, in the same year-ago period.
Adjusted EBITDA loss for the nine months ended September 30, 2021 was $3.0 million, an improvement compared to adjusted EBITDA loss of $6.6 million in the same year-ago period. The improvement in adjusted EBITDA for the nine-month period was primarily due to the increase in revenue compared to the year-ago period.
Management Commentary
“During the third quarter of 2021 we continued to make meaningful progress in building our sales pipeline and securing new partnerships,” said Bob Eckel, Aware’s chief executive officer. “Our sales and operational traction enabled us to generate 69% year-over-year revenue growth in Q3, bringing our total revenue for the first nine months of 2021 past full year 2020 levels. Importantly, our financial performance is characterized by higher quality and more predictable annual revenue and steady operating expenses, demonstrating the leverage in our model.
“We are capitalizing on the strength of our existing customer base by extending our engagements into longer-term commitments. OEM revenue, where we have our SDK built into hardware for providers, has rebounded significantly from last year. We successfully completed a major program ahead of schedule and will be transitioning to add-on sales in the coming quarters. Our balance sheet remains robust as we continue to evaluate strategic opportunities to accelerate our growth and add scale. The momentum in the business is very positive and we remain confident in our ability to deliver solid results as we work toward the end of the fiscal year.”
About Aware
Aware, a global leader in productized biometrics software products, solutions, and services, provides critical biometric functionality to collect, manage, process, and match biometric images and data for identification and authentication. With its decades-long experience, Aware is a market leader in liveness detection and multi-modal fusion to protect client and business processes through fingerprint, face, iris, and voice matching algorithms, mobile biometric capture and authentication software, a biometric workflow and middleware platform, and a fully scalable ABIS. Aware’s device-agnostic, integration-ready, and customer-managed products enable ease-of-use for enterprises to empower individuals to own their identities. Aware serves customers across a multitude of industries, including financial services, enterprise security, healthcare, human resources, citizen ID, border management, law enforcement, defense, and intelligence. Aware is a publicly held company (Nasdaq: AWRE) based in Bedford, Massachusetts. To learn more, visit https://www.aware.com or follow Aware on Twitter @AwareBiometrics.
Safe Harbor Warning
Portions of this release contain forward-looking statements regarding future events and are subject to risks and uncertainties, such as estimates or projections of future revenue, earnings and non-recurring charges, and the growth of the biometrics markets. Aware wishes to caution you that there are factors that could cause actual results to differ materially from the results indicated by such statements.
Risk factors related to our business include, but are not limited to: i) our operating results may fluctuate significantly and are difficult to predict; ii) we derive a significant portion of our revenue from government customers, and our business may be adversely affected by changes in the contracting or fiscal policies of those governmental entities; iii) a significant commercial market for biometrics technology may not develop, and if it does, we may not be successful in that market; iv) we derive a significant portion of our revenue from third party channel partners; v) the biometrics market may not experience significant growth or our products may not achieve broad acceptance; vi) we face intense competition from other biometrics solution providers; vii) our business is subject to rapid technological change; viii) our software products may have errors, defects or bugs which could harm our business; ix) our business may be adversely affected by our use of open source software; x) we rely on third party software to develop and provide our solutions and significant defects in third party software could harm our business; xi) part of our future business is dependent on market demand for, and acceptance of, the cloud-based model for the use of software: xii) our operational systems and networks and products may be subject to an increasing risk of continually evolving cybersecurity or other technological risks which could result in the disclosure of company or customer confidential information, damage to our reputation, additional costs, regulatory penalties and financial losses; xiii) our intellectual property is subject to limited protection; xiv) we may be sued by third parties for alleged infringement of their proprietary rights; xv) we must attract and retain key personnel; xvii) our business may be affected by government regulations and adverse economic conditions; xviii) we may make acquisitions that could adversely affect our results, xix) we may have additional tax liabilities; and xx) we believe the effects caused by the COVID-19 pandemic will likely have an adverse impact on our revenue over the next several quarters.
We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our annual report on Form 10-K for the fiscal year ended December 31, 2020 and other reports and filings made with the Securities and Exchange Commission.
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| Aware, Inc. | www.aware.com | 1.781.276.4000 | | © 2020 Aware, Inc. |
