HOLMDEL, N.J., Aug. 13, 2025 (GLOBE NEWSWIRE) -- BIO-key® International, Inc. (Nasdaq: BKYI), an innovative provider of workforce and customer Identity and Access Management (IAM) solutions featuring passwordless, phoneless and tokenless enhanced biometric authentication, announced results for its second quarter (Q2'25) and six months (6M'25) ended June 30, 2025. BIO-key is hosting an investor call today at 10:00am ET (details below).
Q2 Key Highlights
- Foreign Defense Ministry Awarded BIO-key over $600K in Follow-On orders for Secure Biometric Access to Critical Information.
- BIO-key and Runlevel Secured First Major IAM Deployment with a National Bank in Mozambique, Extending a Growing List of Banking Customers.
- BIO-key Partnered with Cloud Distribution Co. of Saudi Arabia to Expand IAM and Biometric Security Solutions Across the Middle East [and with Arrow ECS Iberia to Strengthen Market Access in Spain and Portugal].
- Completed Initial Phase Biometric-Based Deployment for a New International Defense Agency Customer.
BIO-key CEO, Mike DePasquale commented, "BIO-key's Q2 revenue improved both sequentially and versus last year as we make steady progress advancing our direct and channel sales efforts which have been refocused solely on BIO-key branded solutions principally in Europe, Middle East and Africa (EMEA) as well as domestic markets.
BIO-key CyberDefense Initiative
"In addition to ongoing engagement in core North American enterprise markets, we are pursuing the substantial potential for IAM and biometric enabled solutions within the global defense market. Building on our growing base of highly respected military and defense customers across Europe, South America and the Middle East, we are forming the BIO-key CyberDefense Initiative. We are assembling a team of seasoned cybersecurity sales and support resources with specific military and intelligence expertise to engage with leading defense industry prime contractors to expand our market reach and potential. We expect this initiative to be supported by the recent and significant ramp in European defense spending commitments, including the clear shift toward cyber resilience as a security priority for European nations.
"This initiative positions us as a trusted provider of MFA, IAM and biometric enabled solutions to Ministries of Defense, Armed Forces, Intelligence and defense-integrated partners to support classified access environments aligned with European Union, NATO and other cyber frameworks. EU Member states are expected to spend €350B or more on defense in 2026, with Germany alone boosting its defense budget by over 30% to €83 billion from its 2025 level, with a meaningful portion set aside to ensure cyber resilience.
"We believe BIO-key's successful track record in providing efficient, robust and highly secure authentication and identification solutions to the most discriminating defense sector IT groups puts us in a very strong position to capitalize on this opportunity both in Europe and around the globe. With a robust pipeline of existing opportunities, based on expected procurement cycles, we expect to see meaningful contract activity in the first half of next year.
"Turning back to our Q2'25 performance, gross margin moderated to 73% vs. 77% in Q2'24, reflecting an increase in hardware sales as a percentage of total revenue. We made further progress reducing total operating expenses to $2.3M in Q2'25 vs. $2.5M in Q2'24 as we trimmed selling, general and administrative expense by 13.5% compared to last year, more than offsetting a $45,000 increase in R&D expense. Q2'25 SG&A did reflect roughly $0.3M in expenses related to our global sales efforts, as well as the launch of new marketing initiatives that capitalize on customer traction and our core strengths in biometric enabled identification. Our R&D investments are currently advancing a significant platform modernization and deployment improvements for PortalGuard IDaaS. This is the first major upgrade of the platform since 2018, with a targeted release in Q4'25.
"With increasing interest in our biometric solutions, growing adoption of passwordless, phoneless and tokenless IAM solutions, a strong margin profile, and revenue traction in EMEA markets, we are optimistic about our growth outlook. We feel that the security, flexibility, ease of deployment and the compelling ROI of our solutions, combined with growing market acceptance of the need, should position us to deliver improved top- and bottom-line results in 2025. Of course the timing of large customer orders or renewals is likely to cause quarter-to-quarter fluctuations in our financial performance. We also continue to pursue opportunities to reduce costs and lower our breakeven level to support our path to positive cash flow and profitability, while balancing these efforts with our product development and marketing efforts."
Financial Results
Q2'25 revenues increased 49% to $1,696,907 from $1,141,286 a year ago, reflecting higher revenues across the business. Software license fees increased 4% to $806,087 in Q2'25 from $774,225 a year ago, principally due to the ramp up of BIO-key product sales in Europe, Middle East and Africa (EMEA) territories following the termination of sales and support of AuthControl products in Europe. BIO-key EMEA has been experiencing and expects to see growing engagement for its product suite based on the products' unique combination of security, flexibility, biometric capabilities, ease of use, quick installation and [superior/compelling] value and return on investment relative to other solutions.
Services revenues increased to $321,996 in Q2'25 from $283,569 in Q2'24, largely due to custom services revenue related to a large upgrade for one customer. Q2'25 hardware sales increased to $568,824 from $83,492 in Q2'24, principally due to the expanding deployment of biometric security solutions of a long-term customer, as well as the sale of some of fully reserved hardware inventory.
Q2'25 gross profit increased 40% to $1,232,727 from $879,014 in Q2'24, reflecting gross margins of 73% and 77%, respectively. The gross profit decline is due primarily to the significant year-over-year increase in hardware revenues which carry lower margins.
Reflecting ongoing efforts to reduce costs across the business, BIO-key's total operating expenses decreased by 8.5% to $2,316,577 from $2,533,100 in Q2'24. The improvement reflects a 13.5% reduction in SG&A expenses to $1,680,550 in Q2'25 from $1,941,866 in Q2'24, on lower administration, sales personnel costs, and professional service fees. RD&E expenses increased 7.6% to $636,027 compared to $591,234 in Q2'25, primarily related to increased professional services and personnel costs, offset by lower rent costs.
Reflecting higher revenues and the benefit of lower operating costs, BIO-key's Q2'25 net loss improved to ($1,167,396), or ($0.20) per share, compared to ($1,666,950), or ($1.00) per share, in Q2'24. Per share results are based on weighted average basic shares outstanding of 5,821,133 in Q2'25 and 1,663,042 in Q2'24.
Balance Sheet
As of June 30, 2025, BIO-key's total current assets were $4.0M, including $2.3M of cash and cash equivalents, $1.1M of net accounts receivable and due from factor, and $0.3M of inventory. This compares to total current assets of $1.9M, including $0.4M of cash and cash equivalents, $0.8M of net accounts receivable and due from factor, and $0.4M of inventory at December 31, 2024.
BIO-key further reduced its note payable by $0.4M in Q2'25, leaving a $0.3M balance on the original $2.3M note.
Call Details
| Date / Time: | Wednesday, August 13th at 10 a.m. ET |
| Call Dial In #: | 1-877-418-5460 U.S. or 1-412-717-9594 Int'l |
| Live Webcast / Replay: | Webcast & Replay Link- Available for 3 months. |
| Audio Replay: | 1-877-344-7529 U.S. or 1-412-317-0088 Int'l; code 8281392 |
About BIO-key International, Inc. (www.BIO-key.com)
BIO-key is revolutionizing authentication and cybersecurity with biometric-centric, multi-factor identity and access management (IAM) software securing access for over forty million users. BIO-key allows customers to choose the right authentication factors for diverse use cases, including phoneless, tokenless, and passwordless biometric options. Its hosted or on-premise PortalGuard IAM solution provides cost-effective, easy-to-deploy, convenient, and secure access to computers, information, applications, and high-value transactions.
BIO-key Safe Harbor Statement
All statements contained in this press release other than statements of historical facts are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 (the "Act"). The words "estimate," "project," "intends," "expects," "anticipates," "believes" and similar expressions are intended to identify forward-looking statements. Such forward-looking statements are made based on management's beliefs, as well as assumptions made by, and information currently available to, management pursuant to the "safe-harbor" provisions of the Act. These statements are not guarantees of future performance or events and are subject to risks and uncertainties that may cause actual results to differ materially from those included within or implied by such forward-looking statements. These risks and uncertainties include, without limitation, our history of losses and limited revenue; our ability to raise additional capital to satisfy working capital needs; our ability to continue as a going concern; our ability to protect our intellectual property; changes in business conditions; changes in our sales strategy and product development plans; changes in the marketplace; continued services of our executive management team; security breaches; competition in the biometric technology and identity access management industries; market acceptance of biometric products generally and our products under development; our ability to convert sales opportunities to customer contracts; our ability to expand into Asia, Africa and other foreign markets; our ability to migrate Swivel Secure customers to BIO-key and Portal Guard offerings; our ability to execute definitive agreements with Fiber Food Systems and/or its customers to utilize our access management solutions; our ability to integrate our solutions into any of Fiber Food System's offerings; fluctuations in foreign currency exchange rates; the duration and extent of continued hostilities in Ukraine and its impact on our European customers; the impact of tariffs and other trade barriers which may make it more costly for us to import inventory from China and Hong Kong and certain product components from South Korea; delays in the development of products, the commercial, reputational and regulatory risks to our business that may arise as a consequence of the restatement of our financial statements, including any consequences of non-compliance with Securities and Exchange Commission and Nasdaq periodic reporting requirements; our temporary loss of the use of a Registration Statement on Form S-3 to register securities in the future; any disruption to our business that may occur on a longer-term basis should we be unable to continue to maintain effective internal controls over financial reporting, and statements of assumption underlying any of the foregoing as well as other factors set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024 and other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to disclose any revision to these forward-looking statements whether as a result of new information, future events, or otherwise.
Engage with BIO-key
| Facebook - Corporate: | https://www.facebook.com/BIOkeyInternational/ |
| LinkedIn - Corporate: | https://www.linkedin.com/company/bio-key-international |
| X - Corporate: | @BIOkeyIntl |
| X - Investors: | @BIO_keyIR |
| StockTwits: | BIO_keyIR |
Investor Contacts
William Jones, David Collins
Catalyst IR
BKYI@catalyst-ir.com or 212-924-9800
| BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenues | ||||||||||||||||
| Services | $ | 321,996 | $ | 283,569 | $ | 594,594 | $ | 496,690 | ||||||||
| License fees | 806,087 | 774,225 | 1,904,845 | 2,724,659 | ||||||||||||
| Hardware | 568,824 | 83,492 | 804,627 | 101,140 | ||||||||||||
| Total revenues | 1,696,907 | 1,141,286 | 3,304,066 | 3,322,489 | ||||||||||||
| Costs and other expenses | ||||||||||||||||
| Cost of services | 118,301 | 73,385 | 216,445 | 212,234 | ||||||||||||
| Cost of license fees | 86,488 | 148,432 | 159,373 | 296,652 | ||||||||||||
| Cost of hardware | 536,806 | 40,455 | 645,275 | 53,029 | ||||||||||||
| Cost of hardware - reserve | (277,415 | ) | - | (277,415 | ) | - | ||||||||||
| Total costs and other expenses | 464,180 | 262,272 | 743,678 | 561,915 | ||||||||||||
| Gross profit | 1,232,727 | 879,014 | 2,560,388 | 2,760,574 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Selling, general and administrative | 1,680,550 | 1,941,866 | 3,053,074 | 3,724,839 | ||||||||||||
| Research, development and engineering | 636,027 | 591,234 | 1,231,802 | 1,198,755 | ||||||||||||
| Total operating expenses | 2,316,577 | 2,533,100 | 4,284,876 | 4,923,594 | ||||||||||||
| Operating loss | (1,083,850 | ) | (1,654,086 | ) | (1,724,488 | ) | (2,163,020 | ) | ||||||||
| Other income (expense) | ||||||||||||||||
| Interest income | 2,092 | 46 | 2,095 | 51 | ||||||||||||
| Loan fee amortization | (60,000 | ) | (4,000 | ) | (120,000 | ) | (4,000 | ) | ||||||||
| Change in fair value of convertible note | ||||||||||||||||
| Interest expense | (25,638 | ) | (8,910 | ) | (61,548 | ) | (10,267 | ) | ||||||||
| Total other income (expense), net | (83,546 | ) | (12,864 | ) | (179,453 | ) | (14,216 | ) | ||||||||
| Loss before provision for income tax | (1,167,396 | ) | (1,666,950 | ) | (1,903,941 | ) | (2,177,236 | ) | ||||||||
| Provision for (income tax) tax benefit | - | - | - | - | ||||||||||||
| Net loss | $ | (1,167,396 | ) | $ | (1,666,950 | ) | $ | (1,903,941 | ) | $ | (2,177,236 | ) | ||||
| Comprehensive loss: | ||||||||||||||||
| Net loss | $ | (1,167,396 | ) | $ | (1,666,950 | ) | $ | (1,903,941 | ) | $ | (2,177,236 | ) | ||||
| Other comprehensive income (loss) - foreign currency translation adjustment | 58,805 | 24,220 | 65,608 | (38,530 | ) | |||||||||||
| Comprehensive loss | $ | (1,108,591 | ) | $ | (1,642,730 | ) | $ | (1,838,333 | ) | $ | (2,215,766 | ) | ||||
| Basic and diluted loss per common share | $ | (0.20 | ) | $ | (1.00 | ) | $ | (0.36 | ) | $ | (1.33 | ) | ||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic and diluted | 5,821,133 | 1,663,042 | 5,267,109 | 1,639,183 | ||||||||||||
| BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| June 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 2,275,344 | $ | 437,604 | ||||
| Accounts receivable, net | 983,534 | 718,229 | ||||||
| Due from factor | 154,769 | 74,170 | ||||||
| Inventory | 318,538 | 378,307 | ||||||
| Prepaid expenses and other | 303,045 | 278,648 | ||||||
| Total current assets | 4,035,230 | 1,886,958 | ||||||
| Equipment and leasehold improvements, net | 102,499 | 140,198 | ||||||
| Capitalized contract costs, net | 367,125 | 409,426 | ||||||
| Deposits and other assets | 7,976 | 7,976 | ||||||
| Operating lease right-of-use assets | 60,829 | 73,372 | ||||||
| Investments | 5,000,000 | 5,000,000 | ||||||
| Intangible assets, net | 942,892 | 1,097,630 | ||||||
| Total non-current assets | 6,481,321 | 6,728,602 | ||||||
| TOTAL ASSETS | $ | 10,516,551 | $ | 8,615,560 | ||||
| LIABILITIES | ||||||||
| Accounts payable | $ | 889,026 | $ | 818,187 | ||||
| Accrued liabilities | 1,170,889 | 1,278,732 | ||||||
| Note payable | 447,153 | 1,525,977 | ||||||
| Government loan - BBVA Bank, current portion | 125,562 | 132,731 | ||||||
| Deferred revenue, current | 873,394 | 773,267 | ||||||
| Operating lease liabilities, current portion | 25,886 | 24,642 | ||||||
| Total current liabilities | 3,531,910 | 4,553,536 | ||||||
| Deferred revenue, long term | 96,729 | 196,237 | ||||||
| Government loan - BBVA Bank - net of current portion | - | 44,762 | ||||||
| Operating lease liabilities, net of current portion | 35,735 | 48,994 | ||||||
| Total non-current liabilities | 132,464 | 289,993 | ||||||
| TOTAL LIABILITIES | 3,664,374 | 4,843,529 | ||||||
| Commitments and Contingencies | ||||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Common stock - authorized, 170,000,000 shares; issued and outstanding; 6,848,776 and 3,715,483 of $.0001 par value at June 30, 2025 and December 31, 2024, respectively | 685 | 372 | ||||||
| Additional paid-in capital | 137,948,437 | 133,030,271 | ||||||
| Accumulated other comprehensive income | 114,898 | 49,290 | ||||||
| Accumulated deficit | (131,211,843 | ) | (129,307,902 | ) | ||||
| TOTAL STOCKHOLDERS' EQUITY | 6,852,177 | 3,772,031 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 10,516,551 | $ | 8,615,560 | ||||
| BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | ||||||||
| Six Months Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (1,903,941 | ) | $ | (2,177,236 | ) | ||
| Adjustments to reconcile net loss to net cash used for operating activities: | ||||||||
| Depreciation | 43,748 | 46,069 | ||||||
| Amortization of intangible assets | 154,738 | 155,900 | ||||||
| Amortization of capitalized contract costs | 91,766 | 80,074 | ||||||
| Amortization of note payable | 120,000 | - | ||||||
| Interest payable on note | 60,175 | - | ||||||
| Operating leases right-of-use assets | 12,543 | 27,564 | ||||||
| Share and warrant-based compensation for employees and consultants | 74,325 | 96,561 | ||||||
| Share-based directors' fees | 20,004 | 9,003 | ||||||
| Bad debts | 15,000 | - | ||||||
| Change in assets and liabilities: | ||||||||
| Accounts receivable | (15,305 | ) | 297,480 | |||||
| Allowance for doubtful receivables | (250,000 | ) | - | |||||
| Due from factor | (80,599 | ) | 71,156 | |||||
| Capitalized contract costs | (49,465 | ) | (198,885 | ) | ||||
| Inventory | 59,769 | 12,558 | ||||||
| Prepaid expenses and other | (24,397 | ) | (24,615 | ) | ||||
| Accounts payable | 71,322 | 258,384 | ||||||
| Accrued liabilities | (107,843 | ) | (141,167 | ) | ||||
| Deferred revenue | 619 | 414,878 | ||||||
| Operating lease liabilities | (7,783 | ) | (51,257 | ) | ||||
| Net cash used in operating activities | (1,715,324 | ) | (1,123,533 | ) | ||||
| CASH FLOW FROM INVESTING ACTIVITIES: | ||||||||
| Capital expenditures | (6,048 | ) | (1,869 | ) | ||||
| Net cash used in investing activities | (6,048 | ) | (1,869 | ) | ||||
| CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from note payable | - | 2,000,000 | ||||||
| Offering costs | (248,783 | ) | (13,470 | ) | ||||
| Proceeds for exercise of warrants | 3,813,057 | 1,400 | ||||||
| Receipt of cash from employee stock purchase plan | 876 | 1,939 | ||||||
| Repayment of government loan | (71,645 | ) | (77,461 | ) | ||||
| Net cash provided in financing activities | 3,493,505 | 1,912,408 | ||||||
| Effect of exchange rate changes | 65,608 | (38,055 | ) | |||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 1,837,741 | 748,951 | ||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 437,604 | 511,400 | ||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 2,275,345 | $ | 1,260,351 | ||||
