Demand for SaaS Digital Content Accessibility Platform Continues to GrowAccelerating Bookings Drive 266% Revenue Increase Year-over-Year
TUCSON, Ariz., Aug. 15, 2017 /PRNewswire/ -- AudioEye, Inc. (OTCQB: AEYE) ("AudioEye" or the "Company") today reported financial results for its second quarter, which ended June 30, 2017.
Second Quarter 2017 and Recent Highlights:
- Reported new cash contract bookings of $1.5 million, bringing cash contract bookings for the first six months of 2017 to $3.2 million, compared to cash contract bookings of $1.9 million for the full year 2016;
- Raised full-year 2017 cash contract bookings outlook range to $5.5 to $6.5 million, compared to a prior range of $4.0 to $6.0 million;
- Reported revenue growth of 266%, to $684 thousand, compared to $187 thousand in the second quarter of 2016;
- Reduced operating loss by 33%, to $906 thousand, compared to $1.4 million in the second quarter of 2016;
- Demonstrated increased revenue momentum as deferred revenue increased to $852 thousand, and contracts in excess of deferred revenue increased to $2.2 million;
- Reduced total operating expenses to $1.1 million, compared to $1.2 million in the second quarter of 2016; *Reported GAAP net loss of $2.2 million, or $0.02 per share, compared with a net loss of $3.5 million, or $0.04 per share in the second quarter of 2016; and
- Won multiple additional new customer contracts including 48 new banking clients.
CEO Todd Bankofier stated, "As an emerging growth company, we continued to rapidly ramp new cash contract bookings while closely controlling operating expenses, favorably impacting both the second quarter and year-to-date results. We also saw significant increases in deferred revenue, which is recognized over the coming quarter, and longer term contracts in excess of deferred revenue. We believe these results demonstrate AudioEye is well on track to achieve our increased cash contract bookings outlook for 2017 and cash-flow positive operations within the next three quarters."
"AudioEye offers the only software-driven solution that can conform a customer's digital content with WCAG 2.0 in 100 days or less, and do so while preserving the brand aesthetic, navigation and functionality of a site," said Dr. Carr Bettis, Executive Chairman of AudioEye. "We believe this is driving rapidly growing interest in our targeted end markets, as well as among prospective customers in new markets. AudioEye offers not just cost-effective solutions for current accessibility needs, but also a highly-automated platform that maintains conformance going forward and provides usability tools to personalize a user's experience."
"We are also pleased to report the Company has a capitalization plan to address current cash needs going forward," stated Dr. Carr Bettis.
2017 Second Quarter Financial Results
AudioEye reported continued growth in revenue, deferred revenue and new cash contract bookings in line with rapidly accelerating demand for AudioEye's SaaS digital content accessibility platform across its targeted end markets. The Company reported revenue of $684 thousand for the second quarter ended June 30, 2017, compared to revenue of $187 thousand in the second quarter of 2016. New cash contract bookings were $1.5 million, the second-best quarter in Company history, following a record $1.7 million in cash contract bookings in the preceding quarter. Deferred revenue increased to $852 thousand, reflecting revenues expected to be recognized in the third quarter of 2017. Contracts in excess of deferred revenue increased to $2.2 million, reflecting contracted amounts to be recognized more than one quarter in the future.
Gross profit in the second quarter was $244 thousand, or 36% of revenue, compared to gross loss of $111 thousand in the second quarter 2016. The change in gross margin reflects increased revenue. Once fully ramped, AudioEye anticipates gross margins in excess of 80%, consistent with its SaaS business model.
Operating expenses decreased 7%, to $1.1 million for the second quarter, compared to $1.2 million in the second quarter of 2016. Sales and marketing expenses increased by $143 thousand, reflecting increased sales staff and marketing driving revenue growth, partially offsetting expense reductions of $234 thousand in all other areas of operating expenses.
AudioEye reported an operating loss of $906 thousand in the second quarter of 2017, compared to an operating loss of $1.4 million in the second quarter of 2016.
For the quarter, AudioEye reported net loss of $2.2 million, or $0.02 per share, compared to a net loss of $3.5 million, or ($0.04) per basic share in the second quarter of 2016. GAAP net loss for the second quarter of 2017 includes non-cash charges for amortization and depreciation of $148 thousand and a loss on derivative liabilities of $1.3 million.
Cash Flow and Balance Sheet
Net cash used in operating activities was $1.3 million for the second quarter. Accounts receivable increased by $209 thousand as revenue ramped, and accounts payable declined by $141 thousand. The Company anticipates further reduction in cash burn as it moves toward breakeven revenue results. At the end of the second quarter, the Company's cash balance was $409 thousand.
On July 11, AudioEye raised its full year 2017 cash contract bookings outlook to a range of $5.5 to $6.5 million, from its previous range of $4.0 to $6.0 million. This compares to cash contract bookings of $1.9 million for all of 2016.
About AudioEye, Inc.
AudioEye's software enables every enterprise, from corporations to government agencies, to make their content more consumable through technology.
More accessible. More usable. More people.
AudioEye's common stock trades on the OTCQB under the symbol "AEYE." The Company maintains offices in Tucson, Atlanta and Washington D.C. For more information about AudioEye and its online accessibility solutions, please visit https://www.audioeye.com.
Any statements in this press release about AudioEye's expectations, beliefs, plans, objectives, prospects, financial condition, assumptions or future events or performance are not historical facts and are "forward-looking statements" as that term is defined under the federal securities laws. These statements are often, but not always, made through the use of words or phrases such as "believe", "anticipate", "should", "intend", "plan", "will", "expects", "estimates", "projects", "positioned", "strategy", "outlook" and similar words. You should read the statements that contain these types of words carefully. Such forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from what is expressed or implied in such forward-looking statements, including the risk that the Company's cash contract bookings will not increase as currently expected or at all, the risk that the Company's cash position will not improve or will worsen, and the risk that the Company's current capitalization plan will not provide the Company with sufficient cash to address its current or future needs or will otherwise not be successful. There may be events in the future that AudioEye is not able to predict accurately or over which AudioEye has no control. Other risks are described more fully in AudioEye's filings with the Securities and Exchange Commission. Forward-looking statements reflect management's analysis as of the date of this press release and AudioEye urges you not to place undue reliance on these forward-looking statements. AudioEye does not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect events or uncertainties after the date hereof or to reflect the occurrence of unanticipated events.
For Further information, please contact:
Matt Kreps, Darrow Associates Investor Relations
Phone: (512) 696-6401
Todd Bankofier, AudioEye Chief Executive Officer
Phone: (520) 308-6140