Mitek Systems Inc Q4 2023 Earnings Call Transcript

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

Question: Chad Bennett - Craig-Hallum Capital Group LLC - Analyst : Great. hanks for taking my question or questions. Hey, Max;, and welcome, David. Just a couple of things. Just it was great kind of laying out the linearity of the year from a revenue standpoint. I guess, as much as you can say now that we're effectively almost halfway through the year and maybe it more pertains to the identity part of the business, just in terms of the macro and demand environment and volume environment on that side of the business, any insight, Max, into what you're seeing there or your thoughts on the demand or macro environment on that part of the business right now?

Question: Chad Bennett - Craig-Hallum Capital Group LLC - Analyst : Yeah. And just in terms of the penetration you're seeing with MiVIP and MiPass in the biometric solutions. I guess, can you give a sense of where you are in terms of penetration in your existing base with those solutions?

Question: Chad Bennett - Craig-Hallum Capital Group LLC - Analyst : And just on -- I like the way you laid out the opportunity in Check Fraud Defender. I mean, it certainly seems like you guys are seeing traction with that product. I guess, maybe the best way to ask it is, have you rethought the growth potential of the deposit side of the business, Max? I think it's certainly outgrown, I think, at least my expectations, maybe yours, the last couple of years. But I think we've just generally thought about that business being maybe high single digits, 10%. It's certainly outgrown that materially. But just -- are you thinking any differently about that side of the business and the growth rate the next three to five years?

Question: Chad Bennett - Craig-Hallum Capital Group LLC - Analyst : Got it. All right. Thanks. Great to see the K, obviously, and look forward to more investor-facing activity as we go along here. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 19, 2024 / 9:00PM, MITK.OQ - Q4 2023 Mitek Systems Inc Earnings Call

Question: Jacob Zerbib - William Blair & Co LLC - Analyst : This is Jacob Zerbib on for Jake Roberge. And thank you for taking my questions. So obviously, Check Fraud Defender is seeing solid adoption, but just curious from a go-to-market perspective. Are you dedicating teams to the product yet or is it still combined with the classic check deposit business and leveraging those preexisting relationships? And then I have another question. Thank you.

Question: Jacob Zerbib - William Blair & Co LLC - Analyst : Got it, got it. That's good to hear. And then just to touch on what you're seeing in the market from like a competitive perspective, given the more difficult funding environment for private ID verification providers. Are you seeing competitive benefits in the pipeline as a result of the uncertain macro, so a tailwind given the macro environment?

Question: Jacob Zerbib - William Blair & Co LLC - Analyst : Got it. That sounds great. Congrats on the results again. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 19, 2024 / 9:00PM, MITK.OQ - Q4 2023 Mitek Systems Inc Earnings Call

Question: Owen Rickert - Northland Securities Inc - Analyst : This is Owen on for Mike Grondahl. I just have two questions. So first, what are your priorities for Mobile ID in 2024?

Question: Owen Rickert - Northland Securities Inc - Analyst :

Question: Owen Rickert - Northland Securities Inc - Analyst : Great. Thanks for the color. And then lastly, are there any incremental updates on the sales team?

Question: Owen Rickert - Northland Securities Inc - Analyst : Great. Thanks for answering my questions.

Question: Allen Klee - Maxim Group - Analyst : Hello, good afternoon. Questions on your guidance. I think you're guiding to non-GAAP operating margin of 30% to 31%. I think that compares to 31% you did in fiscal '23. So my question is, if the mobile identity business is going to move from losing money to breakeven during the year, so that should improve results. What's the offset that is making margins not go up? Thank you. David Lyle - Mitek Systems Inc - Chief Financial Officer, Senior Vice President, Principal Accounting Officer, Principal Financial Officer Yeah. It's a couple of different -- just doing the high-level math first. If you take our revenue guidance and assume gross margin similar to 2023 looking at 2024 and backing into operating expense, we're growing operating expense somewhere in the kind of $7 million range year over year, $23 million to $24 million. Most of that it's going to be investment in R&D from a cost perspective. And that's going to be a combination of products that we're investing in, particularly CFD, but also in some of the other earlier stage growth products that we have.

Question: Allen Klee - Maxim Group - Analyst : Great. Last question, is it possible at some point as mobile identity grows that you might be able to break out the more metrics related to it, either the basics of profitability or certain KPIs?

Question: Allen Klee - Maxim Group - Analyst : That's great. Thank you so much.