Mitek Systems Inc Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Jake Roberge - William Blair & Co. LLC - Analyst : Yeah. Thanks for taking the questions and congrats on the solid results. Ed, great to hear about some of the early wins on the go-to-market integration and the bigger push to to MiVIP. Can you just talk about some of the near term opportunities from here? And then if you take a step back, now that you've been with Mitek a bit longer, do you still feel confident this is a business that can return to that double-digit growth key year following these transitions?

Question: Jake Roberge - William Blair & Co. LLC - Analyst : That's helpful, thanks. And then on the check fraud defender front, great to hear the momentum there and signing that top 10 FI last week. Can you talk about how the partner channel for that solution is trending though? I know you all have a few partners already live on the platform so it would be great to hear how those relationships are building. And then is there any update on the potential for some of your larger mobile deposit partners to shift over and start selling that solution as well? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:00PM, MITK.OQ - Q1 2025 Mitek Systems Inc Earnings Call

Question: Jake Roberge - William Blair & Co. LLC - Analyst : Okay, great. And then if I could just sneak one more in. The past few quarters you've talked about the larger ID R&D deals and then the two banking campaigns for ID verification that were pushed out of it. Can you just give us an update on how those those deals are trending through the pipeline and just how they've been accounted for in the guide?

Question: Jake Roberge - William Blair & Co. LLC - Analyst : Yeah, very helpful. Thanks for taking the question.

Question: Mike Grondahl - Northland Systems - Analyst : Hey guys, thanks. The top 10 bank you signed up for check fraud defender, can you talk a little bit about how long the sales cycle was there? And what kind of revenue can this customer generate over the next couple of years?

Question: Mike Grondahl - Northland Systems - Analyst : Was it over a year, the sales cycle?

Question: Mike Grondahl - Northland Systems - Analyst : And what would the revenue potential be -- a range, if you will -- like in year three or four for this bank?

Question: Mike Grondahl - Northland Systems - Analyst : It's nice to see a top 10 bank, that's for sure. Mobile check reorders, did they come in a little bit more than you expected, or how did that shake out in the December quarter? David Lyle - Mitek Systems Inc - Chief Financial Officer, Senior Vice President, Principal Accounting Officer, Principal Financial Officer That wasn't much different than we expected. I'd say it was just a a relatively solid quarter relative to what we thought.

Question: Allen Klee - Maxim Group, LLC - Analyst : Yes, hi. You talked about outside of MiVIP that the mobile verify product had less pricing pressure pressure this quarter so that and that was different than the quarter before. Could you comment on the change maybe in the competitive environment and how you're also thinking about telling more pushing on MiVIP?Thank you.

Question: Allen Klee - Maxim Group, LLC - Analyst : Thank you. And I just wanted to, I was just, -- I know you don't give any '26 guidance, but if you did hit double digits, low double digits, and if I assume that the deposit transaction-related businesses flat. And then some wrote assumptions in the check defender and the identity, it seems like the identity segment would be -- at least in your target of probably higher of $80 million to $85 million -- which would mean that it would no longer be -- at least it wouldn't be a drag on your margins -- REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:00PM, MITK.OQ - Q1 2025 Mitek Systems Inc Earnings Call compared to what you said last year it was like a high single-digit impact on EBITDA margins. Is that -- that could go away? Is that -- is there anything I'd say that I'm missing something? David Lyle - Mitek Systems Inc - Chief Financial Officer, Senior Vice President, Principal Accounting Officer, Principal Financial Officer Yeah, I don't think you're missing anything. Again, it's going to depend on all the work we're doing now. We're actually seeing great results on the things Ed was talking about on how we're optimizing some of the way we operate. If that continues and we're able to achieve what we want, then I think that can be -- the answer can be yes.

Question: Allen Klee - Maxim Group, LLC - Analyst : Great, thanks. Thank you very much.

Question: Surinder Thind - Jefferies - Analyst : Thank you. And I'd like to start with some of the restructuring that's been going on internally. Can you maybe expand upon when we think about the salesforce, we think about the engineering department, where we are in that process and what does it mean for like headcount and just the ability to sell? Is there some sort of resetting or some air pocket that we should be aware of that you kind of work through some of these changes?

Question: Surinder Thind - Jefferies - Analyst : I guess the clarification -- I guess what I was trying to ask was, so you're effectively at target at this point so there's you just kind of went from where you were to target. We shouldn't expect any more changes, meaning we have stability at this point. And from here we kind of build out with respect to kind of -- as people can start to get comfortable in the roles and start asking whether it's building pipelines, all of that kind of stuff, I guess that's kind of what I was trying to get to with this.

Question: Surinder Thind - Jefferies - Analyst : Got it.. And then in terms of -- just as you go through the simplification of your product lineup as you go through some integration efforts, what does that do to the actual sales process? I mean, is there a chance that clients kind of pause a little bit rather than implementing what you have versus maybe willing to wait? And I think that was what I was trying to get at is in terms of if there's any potential for air pockets.

Question: Surinder Thind - Jefferies - Analyst : And then the final one for me, just on check fraud defender. Following up on an earlier question, when we think about the revenue opportunity to given client, is there a way that you can maybe compare it to the opportunity from a mobile deposits perspective, so I assume it's higher, or how should we think about that or any magnitude? Can you get to twice what it might be for mobile or is it an equal, any characterization you can do there?

Question: Surinder Thind - Jefferies - Analyst : Thank you.