AudioEye (AEYE) Q1 2025 earnings summary

Executive summary

• Achieved 37th consecutive quarter of record revenue, with Q1 2025 revenue at $9.7 million, up 20% year-over-year, driven by growth in both Partner/Marketplace and Enterprise channels.

• Annual recurring revenue (ARR) reached $37.1 million, up $500,000 sequentially and 16% year-over-year, with customer count rising to 119,000, up 6% year-over-year but down sequentially due to contract renegotiation.

• Net loss for Q1 2025 was $1.5 million ($0.12 per share), compared to $800,000 ($0.07 per share) in Q1 2024, mainly due to higher operating, litigation, and one-time expenses, including a $300,000 loss on extinguishment of debt.

• Adjusted EBITDA for Q1 2025 was $1.9 million (20% margin), a $1 million improvement year-over-year, and adjusted EPS increased to $0.15 from $0.08.

• Strong business momentum and financial discipline despite a challenging SaaS market since 2022, with pipeline building in both U.S. and Europe and new platform features launched.

Financial highlights

• Q1 2025 revenue reached $9.7 million, a 20% year-over-year increase; gross profit was $7.7 million (80% of revenue), up from $6.3 million (78%) in Q1 2024.

• Net loss for Q1 2025 was $1.5 million ($0.12 per share), compared to $800,000 ($0.07 per share) in Q1 2024.

• Adjusted EBITDA for Q1 2025 was $1.9 million ($0.15 per share), a $1 million improvement year-over-year.

• Cash and cash equivalents at quarter-end: $8.3 million; working capital: $3.6 million.

• Operating expenses for Q1 2025 were $8.7 million, up 25% year-over-year.

Outlook and guidance

• Q2 2025 revenue guidance: $9.85–$10 million; adjusted EBITDA: $1.9–$2 million; adjusted EPS: $0.15–$0.16.

• Full-year 2025 revenue guidance reiterated at $41–$42 million; adjusted EBITDA: $9–$10 million; adjusted EPS: $0.70–$0.80.

• Adjusted EBITDA margin expected to rise to the upper 20s by year-end; free cash flow to approach $3 million in Q4, over 40% year-over-year growth.

• Management anticipates nearly $1/share run-rate free cash flow by Q4 2025.

• Sufficient liquidity projected for the next twelve months; no off-balance sheet arrangements.