authID Reports Financial and Operating Results for the Quarter Ended March 31, 2023
11 Maio 2023 - 5:00PM
authID® [Nasdaq: AUID] a leading provider of secure identity
authentication solutions today reported financial and operating
results for the quarter ended March 31, 2023.
"Balancing uncompromised cybersecurity with an
easy user experience, authID’s biometric identity technology
delivers the enhanced, non-repudiable authentication needed to
protect both workforce and consumer applications against identity
fraud and cyberattacks associated with compromised credentials,”
said CEO Rhon Daguro.
“With exponential growth predicted for digital
transactions, the authID team is focused on achieving market
momentum by delivering the faster, frictionless, and accurate user
identity solutions on which highly secure enterprises and digital
commerce will be built,” concluded Daguro.
Financial Results for the First Quarter
Ended March 31, 2023:
The following highlights comprise results from
continuing operations.
- Total revenue was $0.04 million for the first quarter ended
March 31, 2023, compared with $0.2 million for the first quarter of
2022. The reduction was primarily attributed to revenue from a
legacy authentication product that was discontinued in April
2022.
- Loss for the three-month period in 2023 was $5.2 million, of
which non-cash and one-time severance charges were $3.0 million,
compared with a loss of $5.1 million, of which non-cash and
one-time severance charges were $2.3 million, for the comparable
period in 2022.
- Net loss per share was $0.21 for the first quarter ended March
31, 2023, compared with net loss per share of $0.22 for the first
quarter of 2022.
- Adjusted EBITDA loss improved to $2.2 million for the first
quarter ended March 31, 2023, compared with an Adjusted EBITDA loss
of $2.8 million for the first quarter of 2022, primarily due to
cost savings from the restructuring plan executed in the first
quarter of 2023.
- In March, the Company secured financing of up to $3.6 million
under a facility agreement with Stephen J. Garchik, and completed a
$0.9 million initial drawdown before fees, and expenses.
Please refer to Table 1 for reconciliation of
net loss to Adjusted EBITDA (a non-GAAP measure).
Operational Highlights for the First
Quarter of 2023:
- Appointed Rhon Daguro as Chief Executive Officer and Joe Trelin
as Chairman of the Board.
- Appointed four new directors to the authID Board including Rhon
Daguro, Ken Jisser, Thomas Szoke and Michael Thompson, joining
Directors Michael Koehneman and Jacqueline White.
- Named for the second year in a row “Best ID Management
Platform” by Fintech Breakthrough Awards.
- Expanded the reach of its Verified CloudConnect ecosystem with
the Okta Workforce IdentityCloud and Okta/Auth0 Customer
Identity Cloud, and BeyondTrust’s Privilege
Management for Windows & Mac solution. Through these
OpenID Connect pre-integrations with key Identity Access providers,
authID’s solutions are now easily available through low-code
integration by a larger group of organizations needing to secure
workforce and consumer applications.
About authID Inc.At
authID (Nasdaq: AUID), We Are Digital Identity®.
authID provides secure identity verification
and authentication through Verified™, an
easy-to-integrate strong authentication platform.
Verified combines document-based identity verification with
strong FIDO2 passwordless device authentication and cloud
biometrics to deliver identity-first cybersecurity for
both workforce and consumer applications. Powered by sophisticated
biometric and artificial intelligence technologies,
authID establishes trusted digital identities, binds an
identity to provisioned devices, and eliminates the risks
of passwords to deliver the faster, frictionless, and accurate
user identity solutions demanded by today’s digital ecosystem. For
more information, go to www.authID.ai.
authID Media Contact
Graham N. AradGeneral CounselInvestorRelations@authid.ai
Forward-Looking Statements
This Press Release includes “forward-looking
statements.” All statements other than statements of historical
facts included herein, including, without limitation, those
regarding the future results of operations, cash flow, cash
position and financial position, business strategy, plans and
objectives of management for future operations of both authID Inc.
and its business partners, are forward-looking statements. Such
forward-looking statements are based on a number of assumptions
regarding authID’s present and future business strategies, and the
environment in which authID expects to operate in the future, which
assumptions may or may not be fulfilled in practice. Actual results
may vary materially from the results anticipated by these
forward-looking statements as a result of a variety of risk
factors, including the Company’s ability to successfully implement
its cost-saving initiatives; the Company’s ability to realize the
anticipated benefits of changes to its operations; the terms that
its lender may require for any drawdowns under the Facility
Agreement; the Company’s ability to attract and retain customers;
the Company’s ability to compete effectively; changes in laws,
regulations and practices; changes in domestic and international
economic and political conditions, the as yet uncertain impact of
the war in Ukraine, the Covid-19 pandemic, inflationary pressures,
rising energy prices, increases in interest rates, and others. See
the Company’s Annual Report on Form 10-K for the Fiscal Year ended
December 31, 2022 filed at www.sec.gov and other documents filed
with the SEC for other risk factors which investors should
consider. These forward-looking statements speak only as to the
date of this release and cannot be relied upon as a guide to future
performance. authID expressly disclaims any obligation or
undertaking to disseminate any updates or revisions to any
forward-looking statements contained in this release to reflect any
changes in its expectations with regard thereto or any change in
events, conditions, or circumstances on which any statement is
based.
Non-GAAP Financial
Information.
The Company provides certain non-GAAP financial
measures in this statement. Management believes that Adjusted
EBITDA, when viewed with our results under GAAP and the
accompanying reconciliations, provides useful information about our
period-over-period results. Adjusted EBITDA is presented because
management believes it provides additional information with respect
to the performance of our fundamental business activities and is
also frequently used by securities analysts, investors, and other
interested parties in the evaluation of comparable companies. We
also rely on Adjusted EBITDA as a primary measure to review and
assess the operating performance of our company and our management.
These non-GAAP key business indicators, which include Adjusted
EBITDA, should not be considered replacements for and should be
read in conjunction with the GAAP financial measures.
We define Adjusted EBITDA as GAAP net loss
adjusted to exclude: (1) interest expense, (2) interest income, (3)
income tax expense, (4) depreciation and amortization, (5)
stock-based compensation expense and (6) severance and certain
other items management believes affect the comparability of
operating results. Please see Table 1 below for a reconciliation of
Adjusted EBITDA – continuing operations to net loss – continuing
operations, the most directly comparable financial measure
calculated and presented in accordance with GAAP.
TABLE 1
Reconciliation of Loss from Continuing
Operations to Adjusted EBITDA Continuing Operations.
|
|
|
|
Three Months Ended March 31, |
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
Loss from continuing operations |
$ |
(5,220,239 |
) |
|
$ |
(5,104,208 |
) |
|
|
|
|
|
|
|
|
Addback: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, debt
discount and debt issuance costs amortization expense |
|
800,073 |
|
|
|
32,857 |
|
Other expense (income) |
|
- |
|
|
|
(1,456 |
) |
Severance expenses |
|
811,041 |
|
|
|
150,000 |
|
Depreciation and
amortization |
|
76,017 |
|
|
|
215,476 |
|
Taxes |
|
- |
|
|
|
4,972 |
|
Non-cash recruiting fees |
|
492,000 |
|
|
|
- |
|
Stock compensation |
|
840,021 |
|
|
|
1,866,989 |
|
Adjusted EBITDA continuing
operations (Non-GAAP) |
$ |
(2,201,087 |
) |
|
$ |
(2,835,370 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUTHID INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited)
|
|
|
|
Three Months EndedMarch 31, |
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
Verified software license |
$ |
35,778 |
|
|
$ |
35,493 |
|
Legacy authentication services |
|
2,078 |
|
|
|
129,559 |
|
Total revenues, net |
|
37,856 |
|
|
|
165,052 |
|
|
|
|
|
|
|
|
|
Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative |
|
3,276,191 |
|
|
|
3,643,909 |
|
Research and development |
|
1,105,814 |
|
|
|
1,373,502 |
|
Depreciation and amortization |
|
76,017 |
|
|
|
215,476 |
|
Total operating expenses |
|
4,458,022 |
|
|
|
5,232,887 |
|
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
(4,420,166 |
) |
|
|
(5,067,835 |
) |
|
|
|
|
|
|
|
|
Other (Expense) Income |
|
|
|
|
|
|
|
Interest expense including debts issuance costs amortization |
|
(800,073 |
) |
|
|
(32,857 |
) |
Other income |
|
- |
|
|
|
1,456 |
|
Other expense, net |
|
(800,073 |
) |
|
|
(31,401 |
) |
|
|
|
|
|
|
|
|
Loss from continuing
operations before income taxes |
|
(5,220,239 |
) |
|
|
(5,099,236 |
) |
|
|
|
|
|
|
|
|
Income tax expense |
|
- |
|
|
|
(4,972 |
) |
|
|
|
|
|
|
|
|
Loss from continuing
operations |
|
(5,220,239 |
) |
|
|
(5,104,208 |
) |
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
(2,255 |
) |
|
|
(196,520 |
) |
|
|
|
|
|
|
|
|
Net loss |
$ |
(5,222,494 |
) |
|
$ |
(5,300,728 |
) |
|
|
|
|
|
|
|
|
Net Loss Per Share - Basic and
Diluted |
|
|
|
|
|
|
|
Continuing operations |
$ |
(0.21 |
) |
|
$ |
(0.22 |
) |
Discontinued operations |
$ |
(0.00 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding - Basic and Diluted |
|
25,325,154 |
|
|
|
23,563,852 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUTHID INC. AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
2023 |
|
|
2022 |
|
|
(unaudited) |
|
|
|
|
ASSETS |
Current Assets: |
|
|
|
|
|
Cash |
$ |
1,587,982 |
|
|
$ |
3,237,106 |
|
Accounts receivable, net |
|
55,391 |
|
|
|
261,809 |
|
Other current assets |
|
425,024 |
|
|
|
729,342 |
|
Current assets held for sale |
|
64,671 |
|
|
|
118,459 |
|
Total current assets |
|
2,133,068 |
|
|
|
4,346,716 |
|
|
|
|
|
|
|
|
|
Other Assets |
|
- |
|
|
|
250,383 |
|
Intangible Assets, net |
|
490,242 |
|
|
|
566,259 |
|
Goodwill |
|
4,183,232 |
|
|
|
4,183,232 |
|
Non-current assets held for sale |
|
23,685 |
|
|
|
27,595 |
|
Total assets |
$ |
6,830,227 |
|
|
$ |
9,374,185 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
|
Accounts payable and accrued expenses |
$ |
1,871,443 |
|
|
$ |
1,154,072 |
|
Deferred revenue |
|
73,869 |
|
|
|
81,318 |
|
Current liabilities held for sale |
|
17,795 |
|
|
|
13,759 |
|
Total current liabilities |
|
1,963,107 |
|
|
|
1,249,149 |
|
Non-current Liabilities: |
|
|
|
|
|
|
|
Credit facility, net |
|
458,800 |
|
|
|
- |
|
Convertible debt, net |
|
7,983,896 |
|
|
|
7,841,500 |
|
Accrued severance liability |
|
325,000 |
|
|
|
- |
|
Total liabilities |
|
10,730,803 |
|
|
|
9,090,649 |
|
|
|
|
|
|
|
|
|
Stockholders' (Deficit)
Equity: |
|
|
|
|
|
|
|
Common stock, $0.0001 par value, 250,000,000 shares
authorized; |
|
|
|
|
|
|
|
25,864,437 and 25,319,095 shares issued and outstanding as of March
31, 2023 and |
|
|
|
|
|
|
|
December 31, 2022, respectively |
|
2,587 |
|
|
|
2,532 |
|
Additional paid in capital |
|
141,317,627 |
|
|
|
140,255,234 |
|
Accumulated deficit |
|
(145,352,653 |
) |
|
|
(140,130,159 |
) |
Accumulated comprehensive income |
|
131,863 |
|
|
|
155,929 |
|
Total stockholders' (deficit) equity |
|
(3,900,576 |
) |
|
|
283,536 |
|
Total liabilities and stockholders' (deficit) equity |
$ |
6,830,227 |
|
|
$ |
9,374,185 |
|
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