Q4 2024 BIO-key International Inc Earnings Call

Unknown Attendee: Good morning, everyone. Thank you for standing by and welcome to BIO-key International's 2024 fourth quarter conference call. Dory Management's prepared remarks, all participants will be in listen-only mode.

Good morning, everyone. Thank you for standing by and welcome to buyer. He internationals 'twenty 'twenty four fourth quarter conference call.

During managements prepared remarks, all participants will be in listen only mode.

Unknown Attendee: Afterwards, listeners will be invited to participate in a question and answer session.

Afterwards, we will be invited to participate in a question and answer session.

Unknown Attendee: As a reminder, this conference is being recorded today, Thursday, March 27, 2025.

As a reminder, this conference is being recorded today Thursday March 27th 2025.

William Jones: I will now turn the call over to Bill Jones, Investor Relations. You may proceed. Thank you, Rocco.

Speaker Change: I will now turn the call over to Bill Jones Investor Relations you May proceed.

Thank you Rocco.

Unknown Attendee: Today our hosts are BIO-keys Chairman and CEO Mike DePasquale and its CFO Cecilia Welch.

Speaker Change: Today, our hosts our bio Key's, chairman and CEO, Mike Depasquale and its CFO Tracy Welch.

William Jones: As a reminder, today's conference call and webcast, as well as answers to investor questions, include forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ materially from current expectations. Words including anticipate, believe, estimate, expect, plan, project, or similar words generally express and identify forward-looking statements. Such statements are made based on management's beliefs, assumptions, and information currently available, as of today, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Speaker Change: As a reminder, today's conference call and webcast as well as answers to investor questions include forward looking statements.

Speaker Change: Which are subject to risks and uncertainties that may cause actual results to differ materially from current expectations words, including anticipate believe estimate expect plan project or similar words generally express and identify forward looking statements.

Speaker Change: Such statements are made based on management's beliefs assumptions and information currently available as of today pursuant to the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995 for a complete description of risks that may affect future performance of the company. Please see.

William Jones: For a complete description of risks that may affect future performance of the company, please see risk factors in the company's annual report filed on Form 10-K with the Securities and Exchange Commission. We caution listeners not to place undue reliance on forward-looking statements, which speak only as of today. The company undertakes no obligation to revise or disclose forward revisions to forward-looking statements to reflect circumstances and events that occur after today's call.

Speaker Change: Risk factors in the company's annual report filed on Form 10-K, with the Securities and Exchange Commission, we caution listeners not to place undue reliance on forward looking statements, which speak only as of today. The company undertakes no obligation to revise or disclose what were revisions to forward looking statements to reflect.

Speaker Change: Circumstances and events that occur after today's call.

Michael DePasquale: I will now turn the conference over to Mike to begin. Mike? Thanks, Bill.

Mike DePasquale: I will now turn the conference over to Mike to begin Mike.

Mike: Thanks, Bill good morning, and thank you for joining today's call.

Michael DePasquale: Good morning, and thank you for joining today's call.

Michael DePasquale: After my prepared remarks, I will turn the call over to Ceci for a financial overview. and then we will open the call to investor questions. As highlighted in today's release, we substantially strengthen the margins, profitability and strategic potential of our business in 2024. putting us in a far stronger position to grow and move the business to profitability and positive cash flow. Also, after the close of 2024, we substantially strengthened our financial position with approximately $3.8 million in proceeds from a Warren exercise. Also, at the same time, we were able to reduce our outstanding debt to approximately $730,000 from approximately one and a half million dollars at the end or close of 2024 to what is now currently approximately $730,000.

Speaker Change: After my prepared remarks, I will turn the call over to C. C for a financial overview and then we will open the call to investor questions.

Speaker Change: As highlighted in today's release, we substantially strengthened the margins profitability and strategic potential of our business in 2024.

Speaker Change: Putting us in a far stronger position to grow and move the business to profitability and positive cash flow.

Speaker Change: Also after the close of 2024, we substantially strengthened our financial position with approximately $3.8 million in proceeds from a warrant exercise.

Speaker Change: Also at the same time, we were able to reduce our outstanding debt to approximately 730.

Speaker Change: $30000.

Speaker Change: From approximately one and a half million dollars that'd be and or close of 2024 to what is now currently approximately 730000. This puts us in a much stronger position to continue to execute on our growth plans.

Michael DePasquale: This puts us in a much stronger position to continue to execute on our growth plan. We accomplished most of this by continuing to expand our base of customers and repeat customers and by exiting our low-margin software and services relationship with Swivel Secure to focus our full efforts on core BIO-key solutions such as PortalGuard IAM and our identity-bound biometrics. These solutions have far stronger technology, competitive positioning, and customer value, and also deliver far higher gross margin contributions than the third-party solutions that played a helpful role for us in building our presence in Europe, the Middle East, and Africa.

Speaker Change: We accomplished most of this by continuing to expand our base of customers and repeat customers and by exiting a low margin software and services relationship with Swipple secure to focus our full efforts on core bio key solutions, such as Porto Guard I, a M and our identity.

Speaker Change: Bound biometrics.

Speaker Change: These solutions have far stronger technology competitive positioning and customer value and also deliver far far higher gross margin contributions than the third party solutions that played a helpful role for us in building our presence in Europe, the Middle East and Africa.

Michael DePasquale: Our efforts enabled us to increase high-margin software license fee revenue by 20% to $5.2 million in 2025. and excluding the impact of hardware reserves in both periods, 2024 gross profit rose 8% to 5.4 million for an adjusted gross margin of 78% compared to an adjusted margin of 64% in 2023. The business transition did, however, result in the loss of lower-margin services revenue which offset the growth in license fees and contributed to an 11% decline in revenue to $6.9 million in 2024. We were also able to further reduce operating expenses by 6% in 2024, and we were able to trim our cash burn by 23% to $2.9 million in 2024 from $3.8 million in 2023.

Speaker Change: Our efforts enabled us to increase high margin software license fee revenue by 20% to $5 $2 million in 2024, and excluding the impact of hardware reserves in both periods 2024 gross profit rose, 8% to $5 4 million for an adjusted gross margin up.

Speaker Change: 78% compared to an adjusted margin up 64% in 2023.

Speaker Change: The business transition did however result in the loss of lower margin services revenue, which offset the growth in license fees in Q1 contributed to an 11% decline in revenue to $6 9 million in 2024.

Speaker Change: We were also able to further reduce operating expenses by 6% in 2024, and we were able to trim, our cash burn by 23% to $2 9 million in 2024 from $3 8 million in 2023.

Michael DePasquale: With this transition behind us, we enter 2025 in a much stronger position to drive top line growth and to bring more of that revenue to the bottom line. Importantly, we are already seeing very encouraging order activity and customer interest in our solutions so far in 2025. And that underscores our optimism for the business this year and in the future. Though we have long spoken of expanding breadth of cybersecurity vulnerabilities, actual breaches and the limitations of many widely used identity and access management solutions Many of the IT teams we speak with are recognizing the urgent need for them to deploy stronger and more user-friendly and cost-effective solutions to protect their systems and data.

Speaker Change: With this transition behind US, we entered 2025 and a much stronger position to drive topline growth and to bring more of that revenue to the bottom line.

Speaker Change: Importantly, we are already seeing very encouraging order activity and customer interest in our solutions. So far in 2025 and that underscores our optimism for the business this year and in the future.

Speaker Change: The only have long spoken up expanding our breath of cyber security vulnerabilities actual breaches and the limitations of many widely used identity and access management solutions. Many of the teams we speak with are recognizing the urgent need for them to deploy stronger and more yeah.

Speaker Change: User friendly and cost effective solutions to protect their systems and data.

Michael DePasquale: There's a growing recognition of the inherent vulnerabilities, growing costs and usability challenges of widely deployed current authentication methods that rely on passwords. mobile phones or tokens. 2024 was the first year of the SEC's new cybersecurity risk management and reporting rules for public violence. Elevating the importance of these issues with senior management and direct In addition to compliance requirements for cybersecure and for cyber insurance policy. This growing awareness is helping customers appreciate the substantial value we have built over the past years in forging our flexible suite of passwordless, phoneless, and tokenless authentication For more information visit www.FEMA.gov On top of increasing cyber security demands and high profile The shortage of cybersecurity talent is also challenging organizational ability to prevent or respond to cyber attacks and threats.

Speaker Change: There's a growing recognition of the inherent vulnerabilities growing cost and usability challenges are widely deployed current what dedication methods that rely on passwords.

Speaker Change: Mobile phones or tokens.

Speaker Change: 2024 was the first year of the FCC's, new cyber security risk management and reporting rules for public filers elevating.

Speaker Change: The importance of these issues, which senior management and directors. In addition to compliance requirements for cyber security for cyber insurance policies.

Speaker Change: This growing awareness is helping customers appreciate the substantial value we have built over the past years in forging our flexible suite of password less boneless and token authentication solutions.

Speaker Change: On top of increasing cyber security demands and high profile incidents. This shortage of cyber security talent. It's also challenging organizational ability to prevent the respond to cyber attacks and threats.

Michael DePasquale: This current backdrop, though scary, is proving ideal in supporting the secure and cost-effective solutions we offer. And as a result, we are seeing very encouraging interest and demand for our solutions in mission-critical national defense, financial services, and education applications. We're also seeing growing strength in Europe, the Middle East, and the Asia region, or EMEA countries. where the security and value of our passwordless, phoneless, and tokenless authentication solutions enabled by our unique biometric capabilities are gaining growing recognition and adoption. As an example, in late 2024, we secured a 910,000 contract with a longtime foreign financial services client to implement our most secure and user-friendly one-to-many biometric identification technology across its branch The client has already enrolled Fingerprint Biometrics for over 25 million of its customers.

Speaker Change: This current backdrop, though scary is proving ideal and supporting the secure and cost effective solutions we offer.

Speaker Change: And as a result, we are seeing very encouraging interest in demand for our solutions in mission critical National Defense financial services and education applications.

Speaker Change: We're also seeing growing strength in Europe, the middle East and the Asia region, or EMEA countries, where the security and value of our password list boneless and token lists authentication solutions enabled by our unique biometric capabilities are gaining growing recognition and adoption.

Speaker Change: As an example in late 2024, we secured a 910000 contract with a longtime foreign financial services client to implement our most secure and user friendly one to many biometric identification technology across its branches.

Michael DePasquale: and is now upgrading our fingerprint only identification technology, which enables our client to positively identify each individual from its universe of enrolled customers solely via a fingerprint. This enhanced solution is expected to trim approximately 30 seconds from each of their customer interactions, resulting in an improved customer experience. as well as a substantial long-term saving. Another example is our long-standing relationship with one of the world's most esteemed defense ministers. which substantially expanded its deployment of our biometric solutions in 2024, a trend we expect to continue. We currently provide authentication security for over 80,000 ministry persons. And expect the size of this deployment to double or triple in the coming years as work under a new three-year procurement arrangement that was initiated in Q3 2024 has begun.

This enhanced solution is expected to trim approximately 30 seconds from each of their customer interactions, resulting in an improved customer experience.

Speaker Change: As well as a substantial long term savings for them.

Speaker Change: Another example is our longstanding relationship with one of the world's most esteemed defense ministries, which substantially expanded its deployment of our biometric solutions in 2020 for a trend we expect to continue.

Speaker Change: <unk> will you provide authentication security for over 80000 administered personnel and expect the size of this appointment to double or triple in the coming years as work under a new three year procurement arrangement that was initiated in Q3 2024 has begun.

Michael DePasquale: For perspective, this customer has already contributed a total of over 3.3 million in hardware and license revenue to date. Similarly, we referenced in today's release the partnership we forged with the National Bank of Egypt and our partner, RIA Information Technology, to integrate our PortalGuard IAM platform. and with their leading industry governance. This project will initially secure the digital access and identities of the bank's 30,000 employees. and we believe there's a future potential to expand the deployment. ultimately to its millions of customers. Turning to the U.S., we have built a very strong presence in education to over 100 institutions representing 300 individual single opportunities, serving over 4 billion end-users.

Speaker Change: For perspective, this customer has already contributed a total of over $3 3 million in hardware and license revenue to date.

Speaker Change: Similarly, we referenced in today's release the partnership we forged with the National Bank of Egypt, and our partner riot information technology to integrate our portal guard IEM platform.

Speaker Change: With there and what they're eating leading industry governance solution.

Speaker Change: This project will initially secure the digital access and identities of the bank's 30000 employees.

Speaker Change: And we believe there is a future potential to expand that appointment.

Speaker Change: Ultimately to its millions of customers.

Speaker Change: Turning to the U S. We have built a very strong presence in education to over 100 institutions, representing 300 individual.

Speaker Change: Single opportunities serving over 4 billion end users.

Michael DePasquale: We continue to build our presence in this market with new colleges and universities that are adding portal guards. their PortalGuard platform to their use case. So far in 2025, the Wyoming Department of Education deployed PortalGuard IDAS, and we recently executed a strategic partnership with California Education Technology Joint Powers Authority, which guides IT solution procurement for 195 K-12 schools and districts, serving over two and a half million students. This new relationship positions BIO-key to provide our IAM solutions to those member schools. As we also referenced in today's release, we have been working to see future business opportunities in emerging markets, including food and food safety.

Speaker Change: We continue to build our presence in this market the new colleges and universities that are adding autopart.

Speaker Change: They are portable platform to their use case.

Speaker Change: So far in 2025, the Wyoming Department of Education deployed portal Guard I Das and we recently executed a strategic partnership with California Education Technology joined ours authority, which guides solution procurement for a 195, K 12 schools and districts Jeremy.

Speaker Change: Over two and a half million students.

Speaker Change: This new relationship positions bio key to provide our iam solution to those member schools.

Speaker Change: As we also referenced in today's release, we have been working to seed future business opportunities in emerging markets, including food and food safety.

Michael DePasquale: Internet of Things solutions, drone technology, and autonomous vehicles. We partnered with Fiber Food Systems, Inc. and exchanged BIO-key shares to secure a stake in an innovative drone technology developer, Boomerang, Inc., which will surely require strong identity and access management solutions. The equity exchange strengthened our balance sheet and also led to a strategic collaboration seeking to integrate our biometric technology in aerospace, defense, healthcare logistics, and smart cities applications in development by Gwinn Partners, an engineering and design firm.

Speaker Change: Internet of things solutions drone technology.

Speaker Change: Autonomous vehicles.

Speaker Change: We partnered with fiber Foods systems, Inc, and exchange buyout B shares the secure stake in an innovative drone technology developer Boomeranging, Inc, which will surely require strong identity and access management solution.

Speaker Change: The equity exchange strengthened our balance sheet and also led to a strategic collaboration seeking to integrate our biometric technology in aerospace defense healthcare logistics and smart cities applications.

Speaker Change: Belmont by Gwen partners, and engineering and design firm.

Michael DePasquale: These initiatives are in the early stages and will take time to develop, but we believe they represent exciting potential commercial opportunities for BIO-key down the road. On the current business front, 2025 is off to a solid start and we feel well positioned to deliver improved top and bottom line performance. We've transitioned our EMEA focus to BIO-key solutions and are seeing meaningful signs of customer engagement, particularly in Europe and the Middle East. Globally, we are also seeing growing appreciation for the value of our unique passwordless, phoneless, and tokenless IAM solutions and core biometric technology. all of which underscores our outcome.

Speaker Change: These initiatives are in the early stages and will take time to develop but we believe they represent exciting potential commercial opportunities for <unk> down the road.

Speaker Change: On the current business front 2025 is off to a solid start and we feel well positioned to deliver improved top and bottom line performance.

Speaker Change: We've transitioned our EMEA focus.

Speaker Change: E solutions and are seeing meaningful signs of customer engagement.

Speaker Change: Particularly in Europe, and the Middle East.

Speaker Change: Globally. We are also seeing growing appreciation for the value of our unique password list boneless and token lists I E M solutions and core biometric technology.

Speaker Change: All of which underscores our optimism.

Michael DePasquale: We also continue to focus on opportunities to reduce costs and lower our break-even level. At the same time, we seek to drive growing sales through our Channel Alliance Partner Program and our internal sales team. In addition, we launched PortalGuard IDaaS on the AWS Marketplace last fall, enabling AWS customers to seamlessly purchase and integrate PortalGuard into their enterprise. Today our business is predominantly subscription-based and partner-centric, as roughly 50% of our new PortalGuard business is sold through partners, while nearly all of our EMEA business is partner-based. As a result of these initiatives and with approximately two-thirds of our revenue derived from contracted ARR, we are very confident that BIO-key will return to growth and deliver improved profitability in 2025.

Speaker Change: We also continue to focus on opportunities to reduce cost and lower our breakeven level at the same time, we seek to drive growing sales through our channel Channel Alliance partner program and our internal sales teams.

Speaker Change: In addition, we launched portal got <unk> on the AWS marketplace last fall, enabling AWS customers seamlessly purchasing integrate portal guard into their enterprise.

Speaker Change: Today, our business is predominantly subscription based and partner centric as roughly 50% of our new portal guide business is sold through partners why nearly all of our EMEA business is partner based.

Speaker Change: As a result of these initiatives and with approximately two thirds of our revenue is derived from contracted or are we are very confident that <unk> will return to growth and deliver improved profitability in 2025.

Cecilia Welch: With that overview, I would like to turn the call over to our CFO, Ceci Welch, to review the financials before we take investor questions. Ceci? Thank you, Mike. Our results were released this morning, and we plan to file our 10-K by Monday. Now let me review some of the operating highlights, keeping in mind that year-over-year comparisons are to our restated 2023 results that we filed in our prior 10-K. As Mike touched on, we are excited about our EMEA Civil Secure Services Agreement in Q2-24 and related information.

Speaker Change: With that overview I would like to turn the call over to our CFO <unk> to review the financials before we take investor questions.

Speaker Change: C.

Mike DePasquale: Thank you Mike.

Speaker Change: Our results were released this morning, and we plan to file our 10-K by Monday.

Speaker Change: Let me review some of the operating highlights keeping in mind that year over year comparison, our two our restated 2023 result that we filed in our prior 10-K.

Speaker Change: As Mike touched on we're excited about our EMEA swivel secure services agreement in Q2 24.

Speaker Change: Excuse me exited right.

Cecilia Welch: Thank you. royalty structure and fees created fairly low-margin business and no longer justify the resources it required. While the termination created revenue headwinds in 2024, we believe it ultimately strengthens our business by enhancing gross profit margins, moving forward, and focusing our immediate activities solely on BIO-key solutions. As a result, BIO-key's revenues decreased 11% to $6.9 million in 2024, principally due to our exit from the Civil Secure Limited Distribution Agreement. This strategic decision caused a reduction in all of margin service revenue related to third-party licensed products, but has enabled BIO-key to focus on its own higher-margin software products.

Speaker Change: And related.

Speaker Change: Royalty structure and fees create a fairly low margin business and no longer justify the resources required well the termination created revenue headwinds in 2024, we believe it ultimately strengthen our business by enhancing gross profit margin moving forward and focusing on EMEA activities solely on <unk>.

Speaker Change: Iot solution.

Speaker Change: <unk> revenues decreased 11% to $6 9 million in 2024, principally due to our exit from the similar scale limited distribution agreement. This strategic decision caused a reduction of margin service revenue related to third party licensed products, but has enabled Bryan Keith focused on it.

Speaker Change: High margin software products.

Cecilia Welch: As a result of this transition, the 2024 license fee revenue increased 20% to $5.2 million in 2024. Service revenue declined to $1.1 million from $2.2 million in 2023, and hardware revenue declined $632,000 from 2024 and $1.2 million in 2023, due to a large expansion order received from an existing customer in Q4 2023 that did not reoccur in 2024 but is expected again in 2025. In Q4-24, our license fee revenue increased 77% to $1 million, lower margin services decreased 28% to $344,000, and hardware revenue declined 88% to $94,000, resulting in Q4 revenue of $1.5 million compared to $1.8 million in Q4-23.

Speaker Change: As a result of this transition.

Speaker Change: Transitioned in 2024 license fee revenue increased 20% my point $2 million in 2024.

Speaker Change: Service revenue declined to $1 1 million from $2 2 million in 2023 and hardware revenue declined.

Speaker Change: 626.

Speaker Change: 632000 from 2024, and $1 2 million in 2023 due to a large expansion order received from an existing customer in Q4 of 2023 that did not reoccur in 2024.

Speaker Change: Expected again in 2025.

Speaker Change: In Q4 of 24.

Speaker Change: License fee revenue increased 77%.

Speaker Change: Two 1 million lower margin services decreased 28% to 344 and.

Speaker Change: Hardware revenue declined 88% to 94000, resulting in Q4 revenue of one 5 billion compared to $1 8 million in Q4 23.

Cecilia Welch: Our gross profit grew to $5.6 million in 2024 from $1.4 million in 2023 due to the impact of the $3.6 million Hardware Revenue. in 2023. hardware reserve, sorry, growth in high-margin licensee and reduction in lower-margin services and hardware revenue compared to 2020. 2024 gross profit also benefited from the sale of 213,000 of hardware in 2024, which was previously fully reserved. We reduced our operating expenses. by 600,000. to 9.7 million in 2024 from 10.3 million in 2023 due to the reduced SG&A partially offset by higher research and development engineering costs. to support new product development. BIO-key continues to proactively reduce expenses where possible, and we will continue to closely manage and monitor our operating costs to identify possible savings in 2025.

Speaker Change: Gross profit grew to $5 6 million in 2024 from $1.4 million in 2023 due to the impact of the $3 6 million.

Speaker Change: Hardware revenue.

Speaker Change: In 2023.

Speaker Change: Hi, Barry.

Speaker Change: Growth in high margin license fee and reduction in lower margin services and hardware revenue compared to 2023.

Speaker Change: 2024 gross profit also benefited from the sale.

Speaker Change: 213000 of hardware in 2024, which was previously fully reserved.

Speaker Change: We reduced our operating expenses.

Speaker Change: 600000.

Speaker Change: Two $9 7 million in 2024 from $10 3 million in 2023.

Speaker Change: Due to the reduced SG&A, partially offset by higher research and development and engineering costs.

Speaker Change: To support new product development.

Speaker Change: He continues to proactively reduce expenses, where possible and we will continue to closely manage and monitor our operating alright to identify possible savings in 2025.

Cecilia Welch: Reflecting on greater growth profit and lower operating expenses, BIO-key's 2024 net loss improved to $4.3 million, or $2.10 per share, from a net loss of $8.5 million, or $15.21 per share in 2023. Likewise, BIO-key's Q4 net loss improved to $1.6 million, or $0.53 per share, compared to a $2.4 million loss, or $3.99 per share in Q4 2023. 2023 results also included a hardware reserve of 3.6 million in 2023 and 1.08 in Q4 of 2023. 2024 included positive hardware reserve adjustments of 213 and 24 for the sale of hardware that was previously reserved. Her share amounts are based on weighted average shares of $2,059,000.

Speaker Change: Reflecting our greater.

Speaker Change: Greater gross profit and lower operating expenses <unk>.

Speaker Change: <unk> 2024, net loss improved to $4 3 million or $2 <unk> per share from net loss of $8 5 million or <unk>.

Speaker Change: <unk> 21 per share.

Speaker Change: <unk> thousand 23.

Speaker Change: Q4, net loss improved to $1 6 million or <unk> 53 per share compared to a $2 4 million or $3 99 per share in Q4 2023.

Speaker Change: 2023 result, also included a hardware reserve of $3 6 million in 2023.

Speaker Change: 1.8.

Speaker Change: Q4 of 2023.

Speaker Change: 'twenty 'twenty four included positive hardware reserve adjustments of 214 in Q4 for the sale of hardware that was previously reserved.

Speaker Change: Per share amounts are based on weighted average shares.

Speaker Change: Yeah.

Speaker Change: Alright.

Cecilia Welch: and 884 in 2024 and 560 to 170,000 in 2023, primarily reflecting new shares issued for the warrant conversions of over 1 million shares issued pursuant to the warrant inducement agreement in September 2024. The shares were priced at $1.85 per share for the warrant inducement, yielding gross proceeds of approximately $1.9 million before agencies and offering expense. Turning to our balance sheet, as of December 31st, 2024, BIO-key had current assets of $1.9 million, including $438,000 of cash and cash equipment.

Speaker Change: And 884 in 2024 and 560 to 170000 in 2023, primarily reflecting the shares issued for warrant conversion of over 1 million shares issued pursuant to the warrant inducement agreement in September 2024.

Speaker Change: The shares were priced at $1 85 per share for the warrant inducement, yielding gross proceeds of approximately $1 9 million before agencies and offering expenses.

Speaker Change: Turning to our balance sheet as of December 31, 2020 for Iot had current assets.

Speaker Change: One $9 million, including 438000 with cash and cash equivalents.

Cecilia Welch: This concludes my prepared remarks.

Speaker Change: This concludes my prepared remarks.

Unknown Attendee: So operator, we can now begin the Q&A session. Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. If at any time your question has been addressed and you'd like to remove yourself from queue, please press star then 2. Once again, that's star then 1 if you have a question.

Peter: Peter you can now begin the Q&A session.

Peter: Thank you.

Speaker Change: To ask a question. Please press Star then one on your telephone keypad.

Speaker Change: If at any time your question has been addressed and you'd like to remove yourself from queue. Please press Star then two once again started with once you have a question.

Jack Aarde: And today's first question comes from Jack Van Der Aarde with Maxim Group.

Speaker Change: And today's first question comes from Jack Vander <unk> with Maxim Group. Please go ahead.

Cecilia Welch: Please go ahead. Okay, great. I appreciate the update, guys. Thanks for taking my questions. Maybe just I'll start with a point of clarification. So, did I hear correctly, the 10K is expected to be filed on Monday or by Monday? And then on the restatements that were referenced, was, are these, was there any new additional restatements in prior periods since, you know, since you last reported three key results in November? Or is this just a reference to the restatements that were already disclosed earlier in the year?

Speaker Change: Okay, Great I appreciate the update guys. Thanks for taking my questions maybe.

Speaker Change: Maybe just I'll start with a point of clarification.

Speaker Change: So a day here correctly. The 10-K is expected to be filed on Monday or by Monday, and then on the restatements that were referenced.

Speaker Change: Are these was there any new additional restatements in prior periods. Since since you last reported <unk> results in November or is this just a reference to the restatements that were already disclosed earlier in the year.

Cecilia Welch: Let Ceci take that, sure. So, yes, we expect to file the 10-K on Monday, this coming Monday, and we also are referring to the 2023 restatement. Nothing new this year. Okay, thank you. That's helpful.

Speaker Change: Yeah, let's see take that sure.

Speaker Change: So yes, we expect a part of the plan.

Speaker Change: Okay.

Speaker Change: This coming Monday.

Speaker Change: And we also are referring to the 2023 restatements.

Speaker Change: New this year.

Speaker Change: Okay. Thank you.

Michael DePasquale: So, I guess moving on, Mike, last quarter, I was encouraged by the strong license revenue uptick that happened in the third quarter, especially just given historical seasonality of the business, where it's kind of softer, especially in Europe. And I believe you're expecting from in November, I think you were expecting to finish 2024 with at least having overall total revenue flat with compared to 2023. So, you know, maybe just help me understand what changed or didn't happen. Relative to your expectations that you're talking about, I guess, back in November, did something just get pushed into 2025?

Speaker Change: That's helpful.

Speaker Change: I guess moving on Mike last quarter I was encouraged by the strong license revenue uptick.

Speaker Change: It happened in the third quarter, especially just given historical seasonality of the business, where it's kind of software, especially in Europe.

Speaker Change: And I believe youre expecting.

Speaker Change: From in November I think you were expecting to finish 2024 with at least having overall total revenue flat with compared to 2023. So.

Speaker Change: Maybe just help me understand what changed or didn't happen.

Speaker Change: Relative to your expectations that you were talking about I guess back in November.

Speaker Change: Just hoping just get pushed into 2025, just go through where something longer sales cycles. Just help me understand kind of what changed relative to your I think youre kind of flat growth.

Michael DePasquale: Did it spill through? Was something longer sales cycles? Just help me understand kind of what changed relative to your, I think, your kind of flat growth expectations in 2024. Yeah, I will say it's exactly as I described.

Speaker Change: Growth expectations in 2024, Yeah, I will say, it's exactly as I described it's fundamentally the transition and exit from the swivel secure business.

Michael DePasquale: It's fundamentally the transition and exit from the swivel secure business. The services agreement resulted in, I guess, a delta of about $800,000 or $900,000 for the full fiscal 2024. We had a couple of opportunities that we had in the pipeline for the swivel side that we were converting to BIO-key. And so they took a little bit more time and some of that slipped into the first quarter. But the gross margin impact is just tremendous. I mean, you can see our blended gross margins now are nearing 80 percent. Getting out of that low margin. 10% margin software contract was software support contract was huge for us.

Speaker Change: The services agreement.

Speaker Change: Resulted in I guess, a delta of about eight or $900000 for the full fiscal 2024.

Speaker Change: We had a couple of opportunities that we had in the pipeline for the civil side that we were converting to bio key and so they took a little bit more time and some of that slipped into the first quarter.

Speaker Change: But the gross margin impact is is just tremendous I mean, you can see our blended gross margins now are nearing 80%.

Speaker Change: Getting out of that low margin.

Speaker Change: 10% margin software contract was software support contract, which huge for US and then selling bio key core product versus a third party product, which had a 50% gross margin just has a huge impact on us and so we've made a couple of announcements and on contra.

Michael DePasquale: And then selling BIO-key core product versus a third party product, which had a 50% gross margin just has a huge impact on us. And so we've made a couple of announcements. and on contracts that we closed out of EMEA, one with the National Bank of Egypt in January, but one yesterday for a very notorious defense agency in Europe that is all BIO-key product, and in fact is including biometrics as well with it. So it's fundamentally that transition, Jack, and that's where we came up.

Speaker Change: <unk> that we closed out of EMEA.

Speaker Change: One with the National Bank of Egypt in January, but one yesterday for a very notorious defense agency in Europe that is all bio key product and in fact, this including biometrics as well with it so it's fundamentally that transition Jack and that's.

Speaker Change: Where we came up short.

Michael DePasquale: Okay, got you there. And then maybe just, I guess, if I look at the fourth quarter, Mike, the license revenue was is up year over year, substantially, at least. So that's a positive there. I guess, I guess, just given the the nuanced comments about this, you know, moving off or transitioning away from the SWIVL secure contracts to some of your new BIO-key solutions, is that disruption and transition process, is that is that behind you now? Or is this going to be is there some headwinds related to that, I guess, as you're entering 2025? How should we think about that?

Speaker Change: Okay.

Speaker Change: Got you there.

Speaker Change: Maybe just.

If I look at the fourth quarter Mike.

Speaker Change: The license revenue is up year over year.

Speaker Change: Substantially at least.

Speaker Change: So thats a positive there.

Speaker Change: I guess I guess, just given the nuance comments about moving.

Speaker Change: Moving off our transitioning away from the secured contracts to some of your new <unk> solutions.

Speaker Change: Is that disruption and transition process is that is that behind you now or is this going to be is there some headwinds related to that I guess as youre entering 2025.

Speaker Change: How should we think about that.

Michael DePasquale: Unknown Attendee Totally complete, totally done. We are, again, you saw the contract yesterday. Huge, huge contract for us in the context of visibility, size and magnitude. We are building a very significant presence. in the International Marketplace and this is just another one of those we are totally behind Transition, we're complete.

Speaker Change: Totally complete totally done.

Speaker Change: We are.

Speaker Change: Again, you saw the contract yesterday.

Speaker Change: Huge huge contract for us in the context of <unk>.

Speaker Change: Visibility.

Speaker Change: And magnitude we are.

Speaker Change: Our building a very significant presence in the international defense.

Speaker Change: Marketplace and this is just another one of those we are totally behind.

Speaker Change: The transition we were complete with that.

Michael DePasquale: Okay. That's helpful to know. And then just in terms of your outlook, so you are expecting, it sounds like you're officially expecting, it sounds you're confident you expect to return to growth in the revenue line and improve profitability during 2025 relative to 2024. Since we're already almost done with the first quarter here, you know, March 27th, just any sort of data points, insights into how you expect the first quarter to kind of look compared to the fourth quarter of 2024 and the first quarter of 2024? How's the first quarter of this year looking? Unknown Attendee Yeah, well, we're not closed yet.

Okay.

Speaker Change: It's helpful to know.

Speaker Change: And then just in terms of your outlook.

Speaker Change: So you are expecting it sounds like you're you're officially expecting it sounds youre confident you expect a return to growth.

Speaker Change: And in the revenue line and improve profitability during 2025 relative to 2024.

Speaker Change: Since we're already almost done with the first quarter you are telling me. It's March 27th just any any sort of.

Speaker Change: Data points insights into how you expect the first quarter to kind of look comparison.

Speaker Change: The fourth quarter of 2024 in the first quarter of 2024 is the first quarter of this year looking yeah, well, we're not closed yet and Thats number one and number two we do expect to absolutely emphatically grow our business.

Michael DePasquale: And that's number one. And number two, we do expect to absolutely emphatically grow our business. in 2025. And more importantly, you can see just Again, via the numbers, the gross margins and the march towards profitability should be very aggressive. Our breakeven is coming down. Our expenses, we continue to manage them very, very closely. We're still investing in R&D in areas that are necessary to stay on the leading edge, and we are doing that in our biometrics business. So, yeah, I'm expecting a very, very good 2025 and not only growth on the revenue side, but also a much more accelerated path to profitability and cash flow breakeven.

Speaker Change: In 2025, and more importantly, you can see.

Speaker Change: Just.

Speaker Change: Again via the numbers, the gross margins and the March towards profitability.

Speaker Change: Should be very aggressive this year.

Speaker Change: Breakeven is coming down our expenses, we continue to manage them very very closely.

Speaker Change: Still investing in R&D in areas that are necessary to stay on the leading edge and we're doing that our biometrics business. So yeah.

Speaker Change: Yeah, I'm expecting a very very good 2025 and are not only growth on the revenue side, but also.

Speaker Change: A much more accelerated path to profitability and cash flow breakeven.

Unknown Attendee: Okay, great.

Speaker Change: Okay, Great and then maybe just from a segment perspective, because things have obviously been you guys. It's very fluid here licensing recurring license revenues, obviously the story.

Michael DePasquale: And then maybe just from a segment perspective, because things have obviously been, you know, you guys, it's been very fluid here. Licensing, recurring license revenues, obviously the story. from I guess from a hardware perspective and then their services respective those two segments are we expecting huge help walk me through those I guess are we expecting growth in the hardware line at all or is that maybe that's a potential upside benefit or is that not really the focus and then the services revenue side as well it's been kind of stable between you know 20,000 to 34,000 I guess per quarter on the rev or 340,000 to 200,000 on the revenue quarterly line expecting growth in any of those segments yeah so great question so on the hardware side interesting as I mentioned biometrics and that's our unique competitive advantage are becoming more and more part of every contract that we're selling so with that comes hardware.

Speaker Change: From.

Speaker Change: From I guess from a hardware perspective, and then there are services perspective. Those two segments are we expecting can you just help walk me through those I guess are we expecting growth in the hardware line at all or is that maybe that's a potential upside benefit or is that not really the focus.

Speaker Change: And then the services revenue side as well, it's been kind of stable.

Speaker Change: Between 20000 to 34000, I guess per quarter.

Speaker Change: $340000.

Speaker Change: 200000 on the revenue quarterly line.

Speaker Change: You had some growth in any of those segments. Yeah. So great question. So on the hardware side interesting as I mentioned biometrics and Thats, our unique competitive advantage are becoming more and more part of every contract that we're selling so with that comes hardware sales.

Michael DePasquale: because typically customers are deploying in the enterprise are deploying our finger biometric technology. So along with the software, the subscription license software, they're also acquiring the hardware to be able to facilitate the authentication process. So I do believe we'll see growth on the hardware side. I do believe that on the services side, I think we're going to be very, very stable to growing. But it's not going to be again against that software support contract like we had in 2023. That's gone. It didn't exist in 2024. So I do believe you'll see growth on the services side as well as we proceed forward.

Speaker Change: Because typically customers are deploying in the enterprises deploying our finger biometric technology, so along with the software the subscription license software. They are also acquiring the hardware to be able to facilitate the authentication process. So I do believe we will see growth on the hardware side.

Speaker Change: I do believe that on the services side.

Speaker Change: I think we're going to be very very stable to growing.

Speaker Change: But it's not going to be again against that software support contract like we had in 2023, that's gone it didn't exist in 2024, So I do believe you'll see growth on the services side as well as we proceed forward and that will be professional services or.

Michael DePasquale: And that will be professional services or different types of support that may be even episodal that we provide our customers as they onboard our solutions. So, yeah, I do believe we'll see growth in both of those lines in 2025. Great. Okay.

Speaker Change: Different types of support.

Speaker Change: That may be even episodes that we provide our customers as they onboard our solutions. So yeah I do believe we'll see growth in both of those lines in 2025.

Speaker Change: Great. Okay, and then maybe just one more and I'll hop in the queue.

Michael DePasquale: And then maybe just one more and I'll hop in the queue. That, the large order you secured in the fourth quarter, the $910,000 contract, did that, was that fully recognized in the fourth quarter? Or is any of that getting spilled into Q1 of 25? Actually, a significant portion of that order is in Q1 of 2025. So that was an addition, and as I mentioned, we have a very large financial services customer that upgraded to our latest technology. So that was, and we sold them a two-year subscription, which will renew in Q1 of 2025. Q1 of next year, which now represents a million and a half in recurring revenue.

Speaker Change: That the large order you secured in the fourth quarter the $910000 contract.

Speaker Change: Did that was that fully recognized in the fourth quarter or is any of that getting spilled into Q1 of 'twenty five.

Speaker Change: Actually.

Speaker Change: A.

Speaker Change: A significant portion of that order is in Q1 of 2025. So that was in addition, as I mentioned.

Speaker Change: We have a very large financial services.

Speaker Change: Customer that upgraded to our latest technology.

Speaker Change: So that was.

Speaker Change: And we sold them, a two year subscription which will renew.

Speaker Change: In <unk>.

Speaker Change: Q1 of next year, which now represents a million and a half and recurring revenue. So this was a kind of an add on or an upgrade to that existing subscription. So there was about 250 or so thousand dollars recognized in.

Michael DePasquale: So this was a kind of an add on or an upgrade to that existing subscription. So there was about 250 or so thousand dollars recognized in Q4, Q3, Q4, I believe Q4, and about $600,000 in Q1. So good question. Okay, great. That's good to hear.

Speaker Change: Q4, Q3, Q4, I believe Q4 and about $600000 in Q1, so a good question.

Speaker Change: Okay, great that's good to hear.

Jack Aarde: I think that's it for me. I'll hop back in the queue. Thanks for the questions or taking my questions. Thanks, Jack.

Speaker Change: I think that's it for me I'll hop back in the queue. Thanks for the questions for taking my questions. Thanks Jack.

Unknown Attendee: Thank you. And as a reminder, if you'd like to ask a question, please press star than one at this time.

Speaker Change: Thank you and as a reminder, if you'd like to ask a question. Please first started with one at this time.

Dan Kim: We'll pause for just a moment to assemble our roster. And our next question comes from Dan Kim is a private investor. Please go ahead.

Speaker Change: Pause for just a moment to assemble our roster.

Speaker Change: And our next question comes from Dan <unk> Who's a private investor. Please go ahead.

Speaker Change: Oh, Hey.

Speaker Change: I'm just looking at the release from yesterday.

Speaker Change: Hum.

Speaker Change: The day before on the you said, it's a European Defense agency.

Michael DePasquale: Unknown Attendee, Jack Aarde, Cecilia Welch, Michael DePasquale, James Sullivan, BIO-key Unknown Attendee, Jack Aarde, Cecilia Welch, Michael DePasquale, James Sullivan, BIO-key Thanks, and that's the new contract that we announced yesterday. The contract we announced yesterday is with an international, a new customer, that's not an existing customer, it's a new customer, and I can't share any more detail on that other than what you saw. We, as the press release described, we completed the initial deployment in record time, I mean we did it in days, and we'll be working on the next phase, and this is phased, we'll be working on the next phase in the second quarter, this quarter coming up, so it's a substantial contract and it's with a very notorious Defense Agent.

Speaker Change:

Speaker Change: I'm just wondering.

Speaker Change: Is there any kind of idea of the scale.

Speaker Change: The amount of the contract here or the recurring revenues.

Speaker Change:

Speaker Change: Yes, thanks, and Thats, the new contract that we announced yesterday.

Speaker Change: Yeah, the Spain in Holmdel, New Jersey, it's a global leader in identity and access management.

Speaker Change: The contract we announced yesterday is with an international did a new customer that's not an existing customer a new customer and I I can't share any more detail on that other than what you saw we are.

Speaker Change: As the press release described we.

Speaker Change: <unk> completed the initial deployment.

Speaker Change: In record time, I mean, we did it in days and we'll be working on the next phase and this is phased would be working on the next phase in the second quarter. This this quarter coming up so.

Speaker Change: Its a substantial contract and it's with the very notorious.

Speaker Change: Defense Agency in Europe.

Speaker Change: I see I mean can we assume that since it was done so fast that the first phase is pretty small.

Michael DePasquale: I mean, can we assume that since it was done so fast? No, I wouldn't make any assumptions on that at all. But but again, I can't really share any more of the data on on that and our partner and the likes. It's just highly date on that. Well, you're, you're, you're right about that, Dan. There is a lot of talk. You know, the World Bank has circled back. at the beginning of this year at the end of last year at the beginning of this year to try to accelerate what they have been trying to accelerate for 10 years, which is you know, full enrollment of all citizens in Nigeria.

Speaker Change: No I wouldn't make any assumptions on that at all but but again I can't really share any more of the data on on that and our partner and the likes it's just highly confidential.

Speaker Change: I noticed.

Speaker Change: There's been some noise in the World Bank are about.

Speaker Change:

Speaker Change: Moving Nigeria for it on there.

Speaker Change: I'd plans.

Speaker Change: Is there any update on that that you can give us in terms of the.

Speaker Change: Amongst all the bio key contracts in that.

Dan: Well youre right about that Dan there is a lot of talk.

Speaker Change: The World Bank is circle back.

Speaker Change: At the beginning of this year at the end of last year, beginning of this year to try to accelerate.

Speaker Change: What they had been trying to accelerate for 10 years, which is the <unk>.

Speaker Change: Full enrollment of all citizens in Nigeria.

Michael DePasquale: for all kinds of applications, but mostly in the financial. and we'll see. They claim to now be putting an infrastructure in place to be able to pay All of the vendors that enroll these individuals. And obviously, that includes purchasing hardware and, you know, software and all that other stuff. So we'll see. We're watching it. And we'll see what happens over the next over the next few months or as we approach the middle of the year. I really can't share anymore than that. Again, I'm we're following a close Is there any potential for sales? Oh, absolutely.

Speaker Change: For all kinds of applications, but mostly in the financial sector and we'll see they claim to now be putting an infrastructure in place to be able to pay.

Speaker Change: All of the vendors that.

Speaker Change: Enroll these individuals and obviously that includes purchasing hardware and software and all that other stuff. So we'll see we're watching it and we'll see what happens over the next.

Speaker Change: Over the next few months or as we approach the middle of the year.

Speaker Change: I really can't share any more than that again, we're following it closely.

Speaker Change: I mean is there any potential for a sales of the original.

Speaker Change: What was it 10 fingerprint hardware.

Speaker Change: Having the inventory.

Michael DePasquale: But again, there has to be the facility in place to do it. And we are obviously have other opportunities for that equipment. outside of, again, the, you know, Nigeria and some of the African countries. So we're not just waiting on on that particular opportunity to materialize. We're working other ones as well. We have sold some of that inventory. We sold some of it. and we expect to sell much, much more of it. Yeah, I noticed there's about $200,000 in reversed reserve or something. What does that mean that you sold about $200,000 worth of that hardware?

Speaker Change: Oh, absolutely, but again there has to be the facility in place to do it and we are obviously you have other opportunities for that equipment.

Speaker Change: Outside of again.

Speaker Change: G area and some of the African countries. So we're not just waiting on on that particular opportunity to materialize, we're working other ones as well at the same time. So we have sold some of that inventory we sold some of it hitting in 2024, and we expect to sell much much more of it.

Speaker Change: In 2025.

Speaker Change: Yeah, I noticed there's about $200000 in reversed reserve or something are.

Speaker Change: This quarter is that mean that you sold about $200000 worth of that.

Speaker Change: Hardware in the fourth quarter, yes.

Unknown Attendee: Uh, yes. Tell us any more data about that or is it? No, it's just, you know, again, we have various projects that are are in the works and we're seeding them. So, you know, we we we hope that we'll see some more significant, I'll call it volume orders, right? Larger orders in. Calculating a rate that you had about Unknown Attendee, Jack Aarde, Cecilia Welch, Michael DePasquale, James Sullivan, BIO-key I'm sorry, you were breaking up a little bit there. I'm missing what you were saying. I'm sorry.

Speaker Change: Can you tell us any more data about that or is it no.

Speaker Change: Again, we have various projects that are.

Speaker Change: Are in the works and we're seeding them so.

Speaker Change: We hope that we will see some more significant I'll call it volume orders right larger orders.

Speaker Change: Coming in the coming periods.

Speaker Change: I see.

Speaker Change:

Speaker Change: D C am I calculating it right that you had about a 500 K.

Speaker Change: Asheville, a loss in the fourth quarter.

Speaker Change: Or am I, not calculating that right.

Speaker Change: Yeah.

Speaker Change: Because there's no quarter data.

Speaker Change: Alright, I'm sorry.

Speaker Change: Looking up a little bit there I'm missing okay, I'm, sorry, what was your cash flow loss in the fourth quarter from operations.

Unknown Attendee: What was your cash flow loss in the fourth quarter from... I don't have that number in front of me. We didn't. Yeah, I didn't do a separate cash flow for the fourth quarter actually, just for the year. Alright, I mean, but it was less, right? Oh, yes. Yes, cut back. Unknown Attendee, Jack Aarde, Cecilia Welch, Michael DePasquale, James Sullivan, BIO-key And Mike and the R&D, uh... Is that an increase? I think you mentioned an increase in R&D. Can you give us some clue as... that is being spent. Yeah, they're Biometrics are becoming Almost part and parcel of almost every deal that we're selling now.

Speaker Change: Oh I don't have that number in front of me.

Speaker Change: We didn't do a separate cash flow for the fourth quarter actually just for the year.

Speaker Change: Alright, I mean, but it was less right then Oh, yes, yes cut back.

Speaker Change: Hum.

Speaker Change: Right.

Speaker Change: And Mike in the R&D.

Speaker Change: Is that an increase I think you mentioned an increase in R&D can you give us some clue as to what that is being spent on or.

Speaker Change: Yeah, there coming up yes, and I think we've communicated quite a bit about this as well we feel there's a significant opportunity with past keys, and we introduced a product called <unk> and so we're doing some integrations around that and.

Speaker Change: Biometrics are becoming.

Speaker Change: Almost part and parcel of almost every deal that we're selling now.

Michael DePasquale: I mean for someone who's been doing this a long time and you know pushing pushing biometrics because of the not only the security but because of the convenience and the, uh, the overall user. We're seeing that really come to life now. And so the integrations with some of the larger partners, those APIs, things like that are really where we're spending. most of our time and energy and also money, also in the mobile auth area. So, you know, we continue to believe that biometrics for real enterprise mobile authentication are a big play. So that's where we're investing right now.

Speaker Change: For someone who's been doing this a long time.

Speaker Change: And you know pushing pushing biometrics because of the not only the security, but because of the convenience and the.

Speaker Change: The the overall user experience.

Speaker Change: We're seeing that really come to life now and so the integrations with some of the larger partners.

Speaker Change: Those Apis things like that are really where we're spending most of our time and energy and also money.

Speaker Change: Also in the mobile off area. So we continue to believe that biometrics for a real enterprise mobile authentication, our big play So that's where we're investing right now we're.

Cecilia Welch: We're not, you know, our product is, is very, very complete. These are just tweaks and additions to stay on the edge. In terms of op-ed we expect, like flat from the fourth quarter for the first quarter or back to the third quarter or what should we expect? I'll have to throw that to Cecilia. Yeah, I think we're going to be pretty flat for a little while. Talks like what we're doing right now. So pretty flat for a few quarters.

Speaker Change: We're not.

Speaker Change: Our product is is very very complete these are just tweaks and additions to stay on the edge.

Speaker Change: Okay in terms of Opex should.

Speaker Change: Should we expect like it flat from the fourth quarter for the first quarter or going back to the third quarter or what should we expect.

Speaker Change: Going forward in terms of Opex.

Speaker Change: Sorry that the FCC.

Speaker Change: Yeah, well I think we're going to be pretty flat for a little while.

Speaker Change: No.

Speaker Change: What we're doing right now.

Speaker Change: So pretty flat for a few quarters.

Unknown Attendee: Okay, alright, that's all I got. Thank you.

Speaker Change: Okay, Alright, so all I got thank you.

Speaker Change: Thank you I'm showing no further questions. This concludes the question and answer session I would like to turn the call back over to Mike to basketball and for closing remarks.

Unknown Attendee: And showing no further questions, this concludes the question and answer session.

Michael DePasquale: I'd like to turn the call back over to Mike DePasquale for closing remarks. Thank you everyone for your time today and for joining this call. You may reach out to our IR team, whose contact information is in today's press release with any follow-up questions. Also, look for us at the Maxim TMT conference in early June, which we expect to participate in and be available for investor meetings. We also look forward to updating you on our Q1 call in May, and as always, we'll provide interim news updates via press release as they evolve.

Mike: Thank you everyone for your time today and for joining this call.

Mike: You may reach out to our IR team, whose contact information is in today's press release with any follow up questions also look for us at the Maxim TMT Conference in early June, which we expect to participate in and be available for Investor meetings. We also look forward to updating you on our Q1 <unk>.

Mike: Call in May and as always we'll provide interim news updates via press release.

Mike: As they evolve thank you again and have a great day.

Unknown Attendee: Thank you again, and have a great day. Thank you, sir.

Speaker Change: Thank you Sir This concludes today's conference call. We thank you all for attending today's presentation.

Unknown Attendee: This concludes today's conference call. We thank you all for attending today's presentation.

Unknown Attendee: You may now disconnect your lines and have a wonderful day.

Mike: You may now disconnect your lines and have a wonderful day.

Mike: Yeah.

Mike: Yeah.

Mike: [music].