Intellicheck, Inc. (IDN)·Q1 2025 Earnings Summary

Executive Summary

• Record Q1 revenue of $4.894M (+5% YoY) and SaaS revenue of $4.868M (+6% YoY); gross margin 89.7% reflecting higher non-cash software amortization, with new adjusted gross margin metric at 91.8% .
• Results beat S&P Global consensus: revenue $4.894M vs $4.783M estimate (+2.3%) and EPS -$0.007 vs -$0.015 estimate; diluted EPS reported -$0.02 GAAP; management emphasized cash balance ahead of expectations and positive cash flow for 2025 *.
• Deferred revenue rose sharply to $4.518M (from $1.001M in Q4), ACV renewals of ~$10M in Q1 signal durability; working capital $6.6M; cash $5.1M vs ~$3.4M sell-side expectation noted by CFO .
• Strategic diversification offsets retail headwinds: retail down 26% YoY in Q1, with strong progress in retail banking, title insurance, auto, email security and background checks; AWS migration well underway and expected mid-2025 completion to lower hosting costs and speed onboarding .

What Went Well and What Went Wrong

What Went Well

• Diversification delivering growth: “We are growing very quickly in retail banking, title insurance, auto, email account security, and background checks… progress extends to logistics and shipping” (CEO) .
• Pricing power and margin quality: new business pricing up ~9% vs Q4’24; adjusted gross margin introduced and improved to 91.8% despite GAAP amortization drag (CFO) .
• Contract momentum and cash: ACV renewals ~$10M in Q1; cash $5.1M vs ~$3.4M consensus; expectation of higher cash in Q2 and full‑year positive cash flow (CFO) .

What Went Wrong

• Retail exposure headwind: retail revenue down 26% YoY; management cites consumer credit caution and bankruptcies; retail remains a drag near term (CEO) .
• GAAP gross margin compressed to 89.7% from 90.7% YoY due to higher non‑cash amortization (210 bps vs 50 bps in Q1’24) tied to software projects (CFO) .
• Social media customer rollout timing remains uncertain; procurement and usage variability delaying scale despite full integration (CEO) .

Financial Results

Consolidated Financials (USD Millions unless noted)

Gross Margin (GAAP vs Adjusted)

KPIs and Balance Sheet Highlights

Guidance Changes

Note: Company does not provide formal revenue/EPS guidance; management offered qualitative and operating milestone commentary .

Earnings Call Themes & Trends

Management Commentary

• “We are growing very quickly in retail banking, title insurance, auto, email account security, and background checks… logistics and shipping… organizational revitalization will further our anticipated growth.” — Bryan Lewis, CEO .
• “Pricing firmer across the board, up 9% for new business vs Q4’24… adjusted gross margin improved to 91.8% in Q1’25.” — Adam Sragovicz, CFO .
• “In April, we migrated three large clients… this quarter, scheduled 11 additional large clients… expect all no‑integration portal clients moved as well.” — Bryan Lewis, CEO .
• “Consensus for Q1’25 cash was $3.4M… we ended at $5.1M; expect cash higher in Q2 and to end 2025 above Q1.” — Adam Sragovicz, CFO .
• “Revenue from retail was down 26% from Q1’24… diversification strategy has really worked.” — Bryan Lewis, CEO .

Q&A Highlights

• Retail exposure and drag: retail down 26% YoY; retail and banking now roughly equal revenue mix; age‑restricted ~8%, auto ~8% (approximate) .
• Deferred revenue/SaaS RPOs: up ~$3.5M QoQ to highest ever; shift to upfront annual/quarterly prepay model at large banks .
• Pipeline updates: regional bank terms agreed, in procurement; social media fully integrated, timing variable; background checks targeted via resellers and direct “big two” .
• Logistics/shipping use case: preventing organized fraud via CDL/license validation; losses $250K–$1M per truck; reference growth from first customer to two more .
• AR and billing mechanics: AR increase tied to prepay/commit model rather than billing in arrears .

Estimates Context

Values retrieved from S&P Global.
Diluted EPS (GAAP) reported at -$0.02 .
Implication: Both revenue and EPS were better than consensus; expect upward adjustments to margin/cash expectations given adjusted gross margin disclosure and stronger liquidity .

Key Takeaways for Investors

• Q1 beat on revenue and EPS with record revenue and improving adjusted gross margin; GAAP margin compression was a non‑cash amortization effect rather than operational deterioration .
• Stronger cash position and deferred revenue support near‑term visibility; management expects higher Q2 cash and positive 2025 cash flow, which may catalyze estimate revisions .
• Retail drag is material (-26% YoY) but diversification into banking, title, auto, email security and background checks is offsetting; watch execution on reseller channels .
• AWS migration progressing; completion around mid‑2025 should reduce hosting costs and improve onboarding, supporting margin durability beyond adjusted gross metrics .
• Subsequent bank expansion press release (1,900 branches; high seven‑figure TCV) is a tangible growth catalyst into H2’25 as rollout revenue begins Q3’25 .
• Monitor social media customer and large regional bank procurement timelines; either could provide step‑function volume, but timing remains uncertain .
• Near‑term trading: narrative likely pivots to cash strength, deferred revenue, and adjusted margin disclosure; medium term thesis hinges on bank/title channel scale, reseller activation, and migration‑driven cost leverage .

Additional Relevant Press Releases (Q1 period and shortly after)

• Bank partnership expansion: 3‑year high seven‑figure TCV; rollout across >1,900 branches; additional contracted revenue to begin in Q3’25 .
• New SVP of Sales appointment: Tim Poulin, ex‑Ping Identity, hired April 14 to drive revenue, partnerships and sales team scale .
• Ping Identity DaVinci integration (post‑Q1): new channel for rapid digital orchestration and onboarding (June 4) .