IDEX Biometrics (IDEX) Q3 2024 earnings summary

Executive summary

• Transformation program executed, optimizing workforce and consolidating teams in Europe and the UK, with a focus on Asia-Pacific opportunities and cost reduction initiatives.

• Achieved Visa approval for IDEX Pay biometric payment application and Mastercard approval for metal biometric card with KONA I.

• Completed first live biometric transaction on India's RuPay network and launched solutions for visually impaired and school ID/wallet in Kenya.

• Strengthened finances via NOK 70 million capital raise and renegotiated debt terms, improving balance sheet and extending loan maturity.

• On track to reach a quarterly operating run-rate of NOK 2.5 million ($2.5M).

Financial highlights

• Q3 2024 revenues totaled $0.1 million (NOK 0.1 million), down from $0.9 million in Q3 2023 due to lower sensor shipments.

• Net income for Q3 was $1.4 million, including a $5.5 million gain from derivative value changes and favorable loan renegotiation; adjusted net loss was $4.8 million.

• Operating expenses reduced to $4.1 million, down over $2 million from the previous quarter, a 22% reduction excluding certain costs.

• Gross margin improved to 53% in Q3 2024, up from 22.8% a year earlier; year-to-date gross margin stands at 39%.

• EBITDA for Q3 2024 was negative $4.4 million, improved from negative $6.4 million in Q3 2023.

Outlook and guidance

• Targeting a cash operating expense run-rate of $2.5 million per quarter by year-end 2024.

• Anticipates product launches and certifications to drive revenue growth, with key products expected to hit the market in H1 2025.

• Company expects to continue incurring operating losses and negative cash flow into 2025; additional capital expected from share issues and warrant exercises.

• Focused on scaling biometric platforms in Asia-Pacific and the US, targeting both payment and access markets.