Executive Summary

Net revenue printed negative due to one-time concessions and ceased revenue recognition on two customer contracts, overshadowing gross revenue growth; net revenue was $(0.11)M vs $0.25M in Q3’24 and $1.44M in Q2’25 . Operating expenses rose to $5.1M (+36% YoY), driving net loss of $5.2M and EPS of $(0.38) vs $(0.31) YoY .
Booked ARR (BAR) target for FY 2025 cut from $18M to $6M amid longer enterprise sales cycles; management focuses on “FAT100” customers and channel partners to stabilize growth .
Enterprise validation continued: full production agreement with a top-20 global retailer, NESIC/NEC integration, MajorKey collaboration, and a fintech integrating authID with first bank go‑live targeted in Q4’25 .
KPIs whipsawed: ARR rose YoY to $1.7M from $1.0M but fell sharply QoQ from $5.8M; RPO dropped to $3.6M from $13.8M in Q2 on concessions/collection issues, which management expects to recover as bookings close .
Near-term stock narrative likely hinges on Q4 execution: closing enterprise deals, the bank go‑live, and rebuilding RPO; negative net revenue and guidance cut are headwinds, partly offset by partner/customer validation in biometrics and agentic AI .

What Went Well and What Went Wrong

What Went Well

Signed full production with a top‑20 global retailer in Europe after a successful live trial; deployment secures identity verification and password reset, initially for back office with scope to expand across retail stores .
Launched Identity Exchange (IDX) with NESIC (NEC subsidiary) to bind human identity to AI agents, enabling accountable agentic AI at enterprise scale; expands TAM in identity and agentic AI security .
Partner traction: MajorKey announced IDProof+ co-developed with authID; fintech platform integrating Proof and PrivacyKey for ~100+ banks with the first bank targeted to go live this year .

Quote: “We’ve evolved from a promising technology concept into a trusted partner for global leaders in retail, finance, and identity security” — CEO Rhon Daguro .

What Went Wrong

Negative net revenue in Q3 from ~$0.7M concessions and cessation of revenue recognition on a 2024-signed partner pending amended terms and usage ramp; gross revenue was $0.6M but net revenue fell to $(0.11)M .
RPO plunged QoQ to $3.6M from $13.8M as contracted revenue was recognized and adjusted for concessions/payment issues; slightly below $3.8M in Q3’24 .
Operating expenses rose to $5.1M (+$1.4M YoY) on sales/R&D headcount, expanding adjusted EBITDA loss to $4.1M vs $2.9M YoY; net loss widened to $5.2M vs $3.4M YoY .

Financial Results

Quarterly Sequential Performance

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue (Net) ($USD Millions)	$0.296	$1.445	$(0.106)
Operating Expenses ($USD Millions)	$4.675	$5.916	$5.127
Net Loss ($USD Millions)	$4.339	$4.385	$5.173
EPS (Basic & Diluted) ($USD)	$(0.40)	$(0.33)	$(0.38)
Adjusted EBITDA Loss ($USD Millions)	$3.894	$3.363	$4.124

Notes: EBITDA margin and net income margin are not meaningful due to negative net revenue in Q3 .

Year-over-Year (Q3 2024 vs Q3 2025)

Metric	Q3 2024	Q3 2025
Revenue (Net) ($USD Millions)	$0.249	$(0.106)
Gross Revenue ($USD Millions)	$0.249	$0.596
Operating Expenses ($USD Millions)	$3.762	$5.127
Net Loss ($USD Millions)	$3.365	$5.173
EPS (Basic & Diluted) ($USD)	$(0.31)	$(0.38)
Adjusted EBITDA Loss ($USD Millions)	$2.874	$4.124

KPIs and Contracting Metrics

KPI	Q1 2025	Q2 2025	Q3 2025	Q3 2024
Remaining Performance Obligation (RPO) ($USD Millions)	$13.85	$13.8	$3.6	$3.8
ARR ($USD Millions)	$1.2	$5.8	$1.7	$1.0
Gross bARR ($USD Millions)	$0.01	$2.2	$0.2	$1.2
Net bARR ($USD Millions)	$(0.13)	$1.9	$(6.8)	$0.01
cARR ($USD Millions)	$0.00	$0.9	$0.11	N/A
UAC ($USD Millions)	$0.01	$1.2	$0.08	N/A

Balance Sheet note: Cash at 9/30/25 was $4.9M; total stockholders’ equity $8.9M .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Booked ARR (BAR) Target ($USD Millions)	FY 2025	$18	$6	Lowered
RPO Trajectory	Near-term	Not explicitly guided	“Expect to climb back” as bookings come in	Maintained positive trajectory (qualitative)
First Bank Go‑Live (Fintech platform)	Q4 2025	Not previously specified	“First bank is on target to go live this year”	Initiated timeline
Quantitative Revenue/Margin Guidance	FY/Q4	None	None	Unchanged (no guidance)

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2)	Current Period (Q3)	Trend
AI/Technology Initiatives	Launched PrivacyKey; reusable identity concept; IDX launch with NEC in Q2; PrivacyKey performance stats	Formalized IDX with NESIC; agentic AI accountability (human-bound agents)	Expanding scope to agentic AI security
Partners/Channels	Selected vendor status with major fraud platform (Prove); advancing NEC/biometric provider; Major enterprise pilots	MajorKey IDProof+ collaboration; fintech integration; NESIC Symphonict Trust phase one	Strengthening ecosystem partnerships
Sales Mix (FAT100 vs Fast 100)	Focus pivot to enterprise/channel; double-down on segments	Shift reinforces longer cycles; BAR target reduced; pipeline quality improved	Larger deal focus, slower conversions
Revenue Recognition/Concessions	Q2: provision for estimated credit losses; record revenue	~$0.7M concessions; ceased recognition for 2024 partner until amended; negative net revenue	Short-term revenue headwind
RPO/ARR	RPO ~$13.8M; ARR $5.8M at Q2	RPO $3.6M; ARR $1.7M; mgmt expects RPO to rebuild	Temporary compression; rebuilding expected
Enterprise Sales Cycles	9–12+ month cycles noted; pilots ramping	BAR target cut to reflect longer cycles; focus on closing $20M+ pipeline	Acknowledged slower timing, larger TAM

Management Commentary

Prepared remarks highlights:

CEO: “Validation we’re seeing from companies like NESIC, Prove, MajorKey, and a top-tier global retailer confirms that authID’s biometric authentication and Agentic AI security technologies are setting new standards for accountability and trust” .
CFO on revenue adjustments: “Net revenue… was a negative $0.1 million… concessions totaling $0.7 million… ceased revenue recognition for a 2024 partner… adjusted contract balances to reflect only ~$0.4 million paid to date” .
CFO on RPO drop: “As of September 30, 2025, total RPO was $3.6 million, a decrease of approximately $10.9 million over the prior quarter… expect [RPO] to resume its upward trend as we gain traction closing deals” .

Important quotes:

“We are going to be the most important company leading [agentic AI security]” — CEO Rhon Daguro .
“Adjusted EBITDA loss was $4.1 million for Q3… primarily due to increased headcount investment in sales and R&D” — CFO Ed Sellitto .

Q&A Highlights

The call concluded without a substantive Q&A; operator closed the program after prepared remarks and closing comments .
No additional guidance clarifications beyond prepared commentary were discussed .

Estimates Context

Wall Street consensus (S&P Global) for Q3 2025 EPS and revenue was unavailable; GetEstimates returned no consensus values for EPS, revenue, EBITDA, target price, or recommendation. As such, estimate comparisons cannot be made for Q3 [Values retrieved from S&P Global].*

Metric	Q3 2025 Consensus	Q3 2025 Actual
Revenue ($USD Millions)	N/A*	$(0.106)
EPS ($USD)	N/A*	$(0.38)
Adjusted EBITDA ($USD Millions)	N/A*	$(4.124)

*Consensus values unavailable via S&P Global; actuals per company filings.

Key Takeaways for Investors

Near-term risk: negative net revenue and sharp RPO compression due to concessions and revenue recognition cessation; monitor for renegotiation progress and usage ramps with affected customers .
Validation/catalysts: enterprise production win with a top‑20 global retailer, NESIC/NEC integration, and MajorKey/fintech go‑lives can re-accelerate ARR/RPO in Q4–Q1 if executed .
Guidance reset: BAR target lowered to $6M reflects longer enterprise cycles; execution on the $20M+ pipeline is key to restoring confidence and visibility .
Watch Q4 milestones: first bank go‑live on fintech platform, additional enterprise closures, and evidence of RPO rebuilding; these could be stock-positive narrative shifts .
Cost trajectory: OpEx stepped up for sales/R&D; absent revenue scale, adjusted EBITDA loss widened; sustained cost discipline or improved conversion needed to extend cash runway (cash $4.9M at 9/30/25) .
KPIs volatility: ARR fell QoQ (5.8M → 1.7M) but rose YoY; bARR net turned sharply negative; stabilization depends on enterprise go‑lives and partner-led ramps .
Strategic focus: differentiation in privacy-preserving biometrics and agentic AI security positions authID in an expanding TAM; partner ecosystem (Prove, NESIC/NEC, MajorKey) is an accelerant if conversions improve .

authID Inc. (AUID)·Q3 2025 Earnings Summary