AudioEye (AEYE) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $8.5 million, up 8% year-over-year, marking the 34th consecutive quarter of record revenue.

• Annual recurring revenue (ARR) increased to $33.3 million at June 30, 2024, up 12% year-over-year and $1.3 million sequentially.

• Net loss for Q2 2024 narrowed to $0.7 million ($0.06 per share), a 63% improvement year-over-year.

• Customer count grew 16% year-over-year to 121,000 as of June 30, 2024.

• Both enterprise and partner/marketplace channels contributed to sequential and year-over-year growth.

Financial highlights

• Gross profit for Q2 2024 was $6.7 million (79% margin), up from $6.0 million (77% margin) year-over-year.

• Operating expenses decreased 11% year-over-year to $7.2 million, reflecting efficiency gains.

• Adjusted EBITDA was $1.5 million (17% margin), a record, and adjusted EPS was $0.12, a $1.7 million improvement year-over-year.

• Cash balance was $5.1 million as of June 30, 2024, after a $2.4 million earnout payment and share repurchases.

• Net cash used in financing activities increased due to $2.0 million in share repurchases and $2.4 million paid for acquisition consideration.

Outlook and guidance

• Q3 2024 revenue guidance: $8.85–$8.95 million; Adjusted EBITDA: $1.85–$1.95 million; Adjusted EPS: $0.15–$0.16.

• 2024 revenue guidance raised to $34.5–$34.8 million; Adjusted EBITDA to $6–$6.3 million; Adjusted EPS to $0.48–$0.51.

• Company expects to achieve Rule of 40 in Q3 2024 and further margin expansion in 2025.

• Management expects continued focus on recurring revenue growth, product innovation, and expense management.

• Sufficient liquidity is expected to support operations for the next twelve months.