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Date
Thursday, August 14, 2025 at 5 p.m. ET
Call participants
Chief Executive Officer — Rhon Daguro
Chief Financial Officer — Ed Sellitto
Founder and Chief Technology Officer — Tom Szoke
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Risks
Operating expenses -- Operating expenses rose to $5.9 million from $3.6 million the previous year and $4.7 million in the prior quarter, primarily due to increased headcount in sales and R&D, as well as an $800,000 provision for estimated credit loss expense in the second quarter of 2025.
Net loss -- Net loss was $4.4 million, compared to $3.3 million for the second quarter of 2024 and $4.3 million for the first quarter of 2025.
Credit risk -- The CFO noted, "The sequential increase is primarily due to an $800,000 impact from the provision for estimated credit loss expense (GAAP). This represents a credit risk assessment related to certain customer contracts."
Takeaways
Revenue -- $1.4 million in the second quarter of 2025, up sharply from $300,000 in both the second quarter of 2024 and the first quarter of 2025, representing the highest quarterly GAAP revenue in company history.
Annual recurring revenue (ARR) -- $5.8 million as of the second quarter of 2025, compared to $1.1 million as of the second quarter of 2024 and $1.2 million as of the first quarter of 2025.
Booked annual recurring revenue (BAR) -- $2.2 million gross year-to-date in 2025, up from $600,000 in 2024 and $10,000 in the first quarter of 2025, primarily driven by signing the Proof partnership.
Remaining performance obligation (RPO) -- $13.8 million as of June 30, 2025, up from $4.2 million a year ago, with contract terms typically spanning three years.
Cash balance -- $8.3 million as of June 30, 2025, reflecting $8.5 million in net proceeds from capital raises in April and May 2025 and an increase in shares outstanding to 13.4 million as of June 30, 2025.
Adjusted EBITDA loss -- Adjusted EBITDA loss was $3.4 million in the second quarter of 2025, compared to $2.5 million in the second quarter of 2024 and $3.9 million in the first quarter of 2025.
Go-live with UK Fortune Global 500 customer -- The company launched its Privacy Key product into production for this client, following a pilot involving thousands of employees.
Partnership with NEC -- Announced joint development with NEC to demonstrate reusable identity interoperability between the United States and Japan, including adding a former NEC executive to the board.
Agreement with Proof -- Signed as a partner with Proof, one of the largest identity fraud platforms, with revenue from this relationship expected to begin impacting results in the third quarter of 2025.
Indian contract -- The company confirmed it has gone live and begun recognizing revenue from this contract, with the expectation to collect the full $3.3 million annual commitment in the first contract year, despite a delayed start.
IDX platform launch -- The company launched its IDX platform in late July, targeting supply chain identity management and leveraging the ADIA standard; pilot engagements are in planning but not yet underway.
Privacy Key enhancement -- Upgraded with a one-to-many facial search capability, already enabled in production pilots and contributing to an expanded sales pipeline.
New sales motion -- Shifted emphasis to production-level pilots to improve go-live speed and shorten time to revenue, requiring more up-front resource commitment.
2025 BAR goal -- Management reiterated its $18 million BAR bookings target for the year, asserting, "We remain on track to meeting our expectations"
Summary
authID(AUID -3.70%) delivered a substantial revenue advance driven by new contract activations, with GAAP revenue rising to $1.4 million in the second quarter of 2025 and management highlighting initial monetization from both enterprise clients and partnerships. The company added a major agreement with Proof and commenced a production go-live with a UK Fortune Global 500 customer while indicating that Proof-related revenue will begin appearing in the third quarter of 2025. authID revealed its new IDX supply chain identity platform and outlined a strategic partnership with NEC to commercialize cross-country reusable identity solutions, though bookings or financial guidance for these initiatives remain pending. CFO Ed Sellitto confirmed full annual revenue recognition for a $3.3 million Indian contract now live, with the entire amount to be recognized in the first contract year despite a delayed start in the first contract year. Operating expenses and net losses (GAAP) increased in the second quarter of 2025, partly due to higher sales and R&D staffing and increased credit risk provisioning, but the company strengthened its balance sheet through recent capital raises to fund ongoing commercial execution.
Confirming accelerated revenue ramp.
The company described performance-based pilots as an effective sales strategy, noting, "it is far easier to transition their environment from pilot to full production since the integrations have already been in place."
The CFO said deferred revenue of $1.2 million is contractually recurring as of the second quarter of 2025 and will contribute to GAAP revenue in subsequent quarters.
Regarding Proof, CEO Daguro indicated that joint product integration for biometric fraud prevention "can be realized very quickly" for certain customers, while the broader platform incorporation remains in development.
Management acknowledged a current limitation in providing more detailed financial disclosure for certain partnerships, citing customer confidentiality.
Industry glossary
BAR (Booked annual recurring revenue): Projected annual recurring revenue anticipated from each signed customer contract, assessed over an eighteen-month period post-contract signing.
RPO (Remaining performance obligation): Contracted revenue not yet recognized, representing the minimum expected future revenue from signed agreements based on contractual commitments.
CAR (Committed annual recurring revenue): Portion of BAR consisting of fixed license fees and minimum usage guarantees contractually owed, recognized as revenue each contract year after go-live.
UAC (Uncommitted annualized consumption): The portion of BAR reflecting estimated customer usage that is expected to exceed contractual commitments during a contract year.
IDX platform: authID's recently-launched supply chain identity solution, integrating facial biometrics with Accountable Digital Identity Association (ADIA) standards for global, interoperable identity management.
Full Conference Call Transcript
Rhon Daguro; our CFO, Ed Sellitto; and our Founder and CTO, Tom Szoke. By now, you should have access to today's press release announcing our second quarter 2025 results. If you have not received this, the release can be found on our website at investors.authid.ai under the News and Events section. Throughout this conference call, we will be presenting certain non-GAAP financial information. This information is not calculated in accordance with GAAP and may be calculated differently from other company's similarly titled non-GAAP information. Quantitative reconciliation of our non-GAAP adjusted EBITDA information to the most directly comparable GAAP financial information appears in today's press release.
Before we begin our formal remarks, let me remind everyone that part of our discussion today will include forward-looking statements. Such forward-looking statements are not guarantees of future performance, and therefore, you should not put undue reliance on them. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. Some of these risks are mentioned in today's press release. Others are discussed in our Form 10-K and other filings, which are made available at www.sec.gov. Finally, if you are listening to this call via the webcast, you will be able to see the results presentation and advance the slides yourself as prompted by our speakers.
I'd now like to introduce our CEO, Rhon Daguro.
Rhon Daguro: Thank you, Graham. Thank you all for joining us today. I am very excited about the progress we have made through 2025. We recorded, by far, our highest quarterly revenue in AuthID history, $1.4 million. This is a testament to our team's plan to sign clients and bring them live. We are starting to reap the benefits of our strategy. We will cover our financial results momentarily. But first, I'd like to provide updates on the business. Since joining AuthID, I have had the belief that every single identity management strategy will require facial biometrics, in order to combat the advancements of AI being used and abused by fraudsters.
No CISO on their own can defend against the current threats they face today with the identity system they installed even just a year ago. We see this playing out in the news almost every day, with data breaches taking place at incredibly high rates. Every identity stack will have to incorporate facial biometrics as either an additional signal or as the main signal to determine who is behind the device. I believe that AuthID can solve this problem for companies who have to manage multiple identities from contractors, vendors, and suppliers. In response to this pressing issue, we recently launched our IDX platform in late July.
We believe IDX is one of the biggest advances in the identity industry that will eliminate identity fraud, specifically within the supply chain workforce. We do this by integrating our highly accurate biometric authentication with a platform developed from the most comprehensive accountable and reusable identity management standard for a working end-to-end supply chain identity management solution. The IDX Identity solution will be able to exchange an identity that is accountable, deterministic, accurate, and compliant without having to abandon existing identity management infrastructure already in place, in a manner that meets regulatory and compliance requirements. So that CSOs will ultimately know every single identity in their system.
More to come on IDX, but now let me cover our second quarter 2025 highlights in comparison to our last earnings call. During our Q1 2025 earnings call, we stated our ambition to sign another major Fortune 500 customer this year. So this earnings call, I am pleased to report that we have gone live in production with a UK-based Fortune Global 500 customer that is using our Privacy Key product. After a successful pilot pushed out to thousands of employees for proofing and password reset, we were able to take that deployment live, leveraging the integration already in place from the pilot.
We hope to greatly expand this deployment as we work toward the long-term partnership with significant financial upside. Additionally, last quarter, I discussed our potential partnership with a major global biometric hardware provider, in which we ran advanced discussions to implement joint product development and sales. So this quarter, I am excited that I finally get to share that the major global biometric hardware provider is NEC, a multinational leader in IT and technology solutions with over 100,000 employees in over 50 countries, who has been a leader in biometric solutions since 2007.
With the support of NEC, which introduced a similar product known as Symphonic Trust in Japan, we will be able to successfully demonstrate interoperability of a reusable identity between two companies over two countries, the United States and Japan, without any changes to the incumbent identity management systems that were in place before IDX. This has never been done before. And to further our relationship with NEC, we are very excited to add Ramangani, a former NEC executive, as a critical member of our board of directors. We are excited about our partnership and growth opportunities ahead of us.
Also last quarter, I had shared that we have been confirmed as the vendor of choice for a major identity fraud prevention platform. So this earnings call, I'm very pleased to finally say their name. AuthID signed an agreement with Proof, one of the largest identity fraud platforms in the world. In fact, we are actively working towards the go-live of our first joint customer in the coming weeks. We've been very active with Proof through our joint thought leadership webinars, where we have met with customers to share Proof's newly enhanced capabilities with AuthID's platform. This collaboration is not just a customer story.
It's a clear vote of confidence from one of the largest independent fraud platforms in the world. I know our investors are eager to understand the financial benefits of our agreement with Proof. And while I wish we could be more specific, our partnership terms are required to keep that confidential. However, investors will begin to see the revenue impact from the partnership in our financials starting in Q3 of this year. And finally, we continue to advance our contract negotiations with a very large Fortune 500 international human capital company in preparation for a global rollout.
We remain confident that we will sign a long-term commitment soon and we will provide an update again when we have news to share. These achievements further illustrate how our technology investment and innovations are in demand from major enterprise customers and partners. Let me now cover the recent progress made across our platform and existing partnerships. One practical shift to note is that we are emphasizing performance-based production-level pilots to showcase our capabilities to prospects. This has been an effective strategy rather than just relying on proof of concept. Once the pilot is completed, it is far easier to transition their environment from pilot to full production since the integrations have already been in place.
This requires a full level of effort on our teams early in the sales cycle and demands a lot of attention, but it has been proven to be an effective way to earn customer trust, shorten our go-live time, and time to revenue. With regard to our technology improvements, I'd note that just after launching Privacy Key, we immediately began improving the technology in order to better serve our customers. In this case, we have upgraded Privacy Key with a one-to-many search capability, which has already been put into place in production pilots. This update gives companies the ability to scan multiple faces and return the results lightning fast with the highest accuracy in the marketplace.
As a result, our channel partners have been happy to introduce us to additional target customers, which represent an increase in sales pipeline. Our channel partners also add the benefit of bringing us into their key verticals, which helps expand our total addressable market. Before handing it to Ed, let me revisit IDX, our major technological new product milestone. The IDX platform is a global platform built on a fast-adopted standard of the Accountable Digital Identity Association, or ADIA, founded by Ramesh Keshanapali. Along with NEC, no one else has leveraged this new standard into working software. In fact, the ADIA is merging with the Secure Identity Alliance, which includes ZoomInfo, IDEMIA, the FBI, and other security-minded organizations.
This puts AuthID in good company and gives us greater visibility and credibility when prospecting customers across the globe. Many large enterprises use contractors who in turn use other contractors for a variety of business operations. Supply chain identity management is a big problem for large companies since they cannot properly vet the identities of their vendor contractors because of various rules and compliance regulations. From an investment perspective, the identity management market is estimated to be $61 billion by 2032 by Fortune Business Insights. We can only participate in the authentication subset of this market, but with IDX, AuthID is now able to play in the entire market space.
Our TAM has dramatically increased and our launch partner NEC is one of the largest biometric hardware providers in the world. We are still in the early stages of IDX, and we look forward to sharing more about our expectations for this new product once we are in a position to provide a well-informed financial forecast. Currently, we partner with identity management companies and rely on them to try to solve the supply chain identity management problem. When we go into a new engagement and our customers want to implement capabilities like IDX, we are not limited to their existing identity management provider anymore, which will allow us to close larger deals faster.
I'm very pleased with our second quarter results and progress made through the first half of the year. Ed will now take us through the financials in greater detail.
Ed Sellitto: Thank you, Rhon. I look forward to walking you through our Q2 results. Looking at our Q2 2025 GAAP results, total revenue for the quarter increased significantly to $1.4 million compared to $300,000 last year and $300,000 in Q1. The strong revenue growth in Q2, both sequentially and year over year, was primarily driven by the go-live of several contracts signed earlier in 2024. These implementations have now been successfully delivered and are contributing meaningfully to top-line results. Operating expenses for Q2 were $5.9 million compared to $3.6 million a year ago and $4.7 million last quarter. The year-over-year increase is primarily due to increased headcount investment in sales and R&D.
The sequential increase is primarily driven by an $800,000 impact related to the provision for estimated credit loss expense. This represents a credit risk assessment related to certain customer contracts. While this provision reflects our estimated risks, we continue to have strong confidence in our ability to collect on these customer contracts. Net loss for the quarter was $4.4 million, of which non-cash charges were $1.1 million. This compares to a net loss of $3.3 million for the same period last year, which included $800,000 in non-cash and one-time severance charges, and a net loss of $4.3 million in the previous quarter.
Net loss per share for the quarter was $0.33 compared with $0.34 a year ago and $0.40 last quarter. Turning to RPO on the next slide. Remaining performance obligation, or RPO, represents the minimum revenue expected to be recognized from our signed contracts based on our customers' contractual commitments. As of June 30, 2025, our total RPO was $13.8 million, a decrease of approximately $100,000 over the prior quarter as we recognized contracted revenue in Q2 and also added new contracts signed in the quarter. Our RPO for Q2 compares favorably with the same period last year, which was $4.2 million.
We expect to recognize the full RPO of $13.8 million over the entire life of our contracts, which are typically signed with a three-year term. Turning to our balance sheet highlights. As of June 30, our cash balance totaled $8.3 million, which includes approximately $8.5 million in net proceeds received from our successful capital raises in April and May 2025. Our common shares outstanding stood at 13.4 million, with 2.2 million shares added from our fundraise. We will use these funds for a number of priorities, including closing key deals with Fortune 500 prospects, generating revenue growth through our recent IDX platform launch, as well as by implementing and ramping our customer base.
Onto our non-GAAP results on the next slide. Adjusted EBITDA loss was $3.4 million for Q2, compared with a $2.5 million loss for the same period last year and a $3.9 million loss last quarter. As described with our operating expense results, the year-over-year increase in EBITDA loss is primarily due to increased headcount investment in sales and R&D, as well as the Q2 provision for estimated credit loss expense. We also monitor and report on annual recurring revenue, or ARR, which is defined as the amount of recurring revenue earned during the last three months of the relevant period, determined in accordance with GAAP multiplied by four.
ARR as of Q2 is $5.8 million compared to $1.1 million of ARR as of Q2 2024 and $1.2 million as of last quarter. Turning to BAR, or booked annual recurring revenue, which is the projected amount of annual recurring revenue we believe will be earned under contracted orders looking at eighteen months from the date of signing of each customer contract. The gross amount of BAR signed in 2025 was $2.2 million, up from $600,000 of gross BAR a year ago and $10,000 in Q1. The increase in BAR for the quarter was led by the signing of Proof, the identity fraud platform Rhon called out earlier.
As previously explained during our quarterly earnings call, BAR comprises two components which we refer to as CAR and UAC.
Rhon Daguro: CAR, or committed annual recurring revenue, represents the total annual customer contractual commitment, fixed license fees, and minimum usage commitments. These commitments are directly recognized as revenue in each contract year after each customer goes live with the service. Q2 2025 CAR represents $900,000, approximately 41% of reported BAR. UAC, or estimated usage above commitment, is an estimate of annual customer usage that will exceed contractual commitments. Q2 UAC represents the remaining $1.3 million, or 59% of reported BAR. Turning to our revenue growth stages on the next slide. I will finish off by summarizing the progress we're seeing through our revenue growth stages. The first milestone we use to monitor our growth is bookings as measured by BAR.
In Q2, we realized a total gross BAR of $2.2 million. We're excited to begin closing the major large enterprise and platform partnership deals that we discussed last quarter and expect to continue accelerating our bookings growth over the remainder of 2025 as we add pipeline and progress our key large enterprise platform partnership deals. The next milestone is our remaining performance obligation, or RPO. As I detailed earlier, as of Q2, we have secured approximately $13.8 million in RPO, a number that we expect to increase as our bookings continue to grow throughout the remainder of the year. Our third milestone is revenue recognized in accordance with GAAP.
Our Q2 year-to-date revenue of $1.7 million already surpasses our 2024 full-year revenue by approximately $900,000. And we expect this growth to continue throughout the year as our existing signed contracts continue to go live and ramp. As we called out in prior earnings calls, we are increasing our focus on customer retention and expansion this year, as our customer contracts mature. We continue working to build on our customer expansions and grow our customer relationships by adding tangible value in helping our customers achieve their objectives as well as expand and identify new use cases. Overall, we look forward to building on our Q2 momentum.
As we previously stated, our goal is to deliver $18 million in BAR for 2025. We remain on track to meeting our expectations and look forward to updating our investors again in our Q3 call. With that, operator, we would now like to open up for questions.
Operator: Thank you. If you have a question, please press 11 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. One moment for questions. Our first question comes from Gary Brode with Deep Knowledge Investing. You may proceed.
Gary Brode: Hey, guys. I've got a question about the financials. Ed, you might be the right person to answer this. So it looks like you took in $1.2 million of deferred revenue in the quarter. First, can you talk a little bit about where that came from? And then second, you're showing annual recurring revenue of $5.8 million, which is the quarter's revenue times four. But if you took in $1.2 million of deferred revenue in the quarter, is that recurring?
Ed Sellitto: Hey, Gary. Nice to hear your voice. Thanks for the question. So two-part question. The first was about the deferred revenue, the $1.2 million, and that came from invoices that we received from customer contracts that have not yet been recognized as revenue. So we have some invoices that have been issued based on our contract terms that come ahead of the revenue recognition. And so we do expect those invoices and deferred revenue to contribute and roll into revenue over the coming quarters as revenue gets recognized. Number one. And number two, your sorry. Can you repeat the second part of your question again?
Gary Brode: Well, I think you've answered. The second part of the question is, is that actually recurring? But if what you're saying is that the deferred revenue came from invoices from customer contracts where you guys are about to start providing services, then it is recurring and your $5.8 million of annual recurring revenue is accurate. Am I understanding you correctly?
Ed Sellitto: That's correct. The amounts that are in deferred revenue results are coming from contract-driven invoices that are recurring in nature and are just yet to be recognized according to our revenue recognition policy.
Gary Brode: Okay. Got it. Alright. And then can I ask you an a you want me to jump back in the queue, or can I ask you a few questions about the Proof deal?
Rhon Daguro: Go ahead, Gary.
Gary Brode: Okay. So on the webinar that Dale did earlier this week with Proof, they said something on the call that implied you guys were very close to or you've had a working combined model. And that was already up and running. They didn't say it, but it was implied. And then today, you guys were talking about being very close to launching with Proof and one of their customers. I'm assuming that's correct, that there is a working model for the combined company for the combined services rather. And then you guys are about to start providing services to a Proof customer. When would you anticipate first of all, is that correct?
And second, when would you anticipate starting to collect revenue with that contract?
Rhon Daguro: Hey, Gary. I'll take that question. Thank you for that question. Yep. You hear me loud and clear? I just wanna make sure.
Gary Brode: Yeah. Crystal clear.
Rhon Daguro: Alright. Fantastic. So the Proof partnership is actually almost like two parts. The first part is, you know, AuthID has capabilities with onboarding. So our, we call it, document verification, onboarding a new customer, new client. We have those capabilities that Proof has had other partners for. And that piece and that technology where we're partnering with them can be realized very quickly. No integrations. We just perform. We perform better than most, than the marketplace, and that's kinda like how we won the partnership. To be able to work with Proof. So that's part number one. So there's an integration piece that really is very simple to do.
The second part that's a little more strategic, where Proof is as the largest fraud platform out there, they are aligning with that previous statement I said in my comments that every identity stack is going to have to either incorporate a biometric signal in part or in whole to add to their service just because fraud is so rampant, especially with AI. So, the second part is the part that's a little bit more strategic for Proof. And that is the part that we are working very closely with them to build our technology close into their stack and to make it an offering within the Proof platform.
I don't wanna give the name away that they're using, so let them announce that. But that is the second part that's a lot more strategic for us, and we're very excited about that as well. But we'll temper the announcements with Proof and allow them to do that. But really, this is a two-part partnership, and which is why we're excited about it.
Gary Brode: Okay. So And then I think you have a perfect question. Right?
Rhon Daguro: Yeah. The other question on that is at what point will you start collecting revenue? Because it sounds like you're close, but I don't want to be overly optimistic.
Rhon Daguro: Yeah. So in my comments, I said we're about to take a customer live here in a couple of days. In reality, we, you know, hopefully, hopefully tomorrow. But we don't know yet. We will see. But we're very close to taking one of our joint customers live on that first part of that partnership that I just described. So on the like I said, I described the two parts. The first part of that partnership that doesn't require massive integration, that's the first initiative, and we're gonna be hopefully taking one of those joint customers live here in the next coming days. So the main question is when will we start to see those results? Yeah.
We're gonna see them a heck of a lot sooner than ever before because we're now taking those customers live here shortly.
Gary Brode: Okay. So if you do go live within the next day, week, something like that, there will be revenue in this quarter, the third quarter, related to that.
Rhon Daguro: If transactions are being called, which we hope they will be, transactions being called, they should be billed. We should be able to invoice.
Ed Sellitto: Yes. Once we go live, just to reiterate, once we go live, we will start to recognize the contractual commitment portion of the contract as we normally do.
Gary Brode: Alright, guys. That's very helpful. I do have more questions, but I don't want to monopolize the call. Why don't you if other people have questions, and I'll, you know, hit star 11 after and get back in line.
Rhon Daguro: Thanks, Gary.
Operator: Thank you. And as a reminder, to ask a question, please press 11 on your telephone. One moment for questions. Our next question comes from Gary Brode with Deep Knowledge Investing. You may proceed.
Gary Brode: Okay. Well, glad to be back. Can we talk about the Indian contract that you guys signed last November? Have you started providing services, or are you still in ramp-up condition with the company?
Rhon Daguro: We are working with them, and we're still ramping, but we are engaged with them.
Gary Brode: Yes. Okay. So you're working on it that hasn't gone live yet. Is that right?
Rhon Daguro: That's right.
Gary Brode: Okay. And that I'm assuming then that you haven't recognized revenue from them at this point. Is that right?
Ed Sellitto: I'll just clarify Rhon's comment. We are still ramping them, but we did go live and deliver the service to the customer.
Gary Brode: Okay. So have you sorry. Go ahead.
Ed Sellitto: Yeah. So I just wanted to clarify that. Sorry, Gary. Go ahead.
Gary Brode: Thanks, Ed. So thank you. So have you started collecting revenue from them yet?
Ed Sellitto: Yes. Yes. We are recognizing started to recognize revenue as we went live with the customer. That's right.
Gary Brode: Okay. That's great. And then when you announced the deal, I believe there was a provision in there that you're supposed to collect $3.3 million of revenue each year, 2025, 2026, 2027. Given that you didn't start collecting revenue at the beginning of the year from them, understandably, there's no way you're gonna be able to launch in two months. Do you still expect to collect the $3.3 million from them this year that you discussed with the contractual obligation before?
Ed Sellitto: Yeah. So said differently, we do recognize in the first contract year given that there's a delay in go-live for contracts. Of any kind, if we have a commitment for the first year, we do recognize that commitment throughout the remainder of the first contract year. So if it's several a month or two or more that's not recognized, we'll recognize it in the balance of the first contract year. So we would by the end of contract year one, we would have recognized the first year's worth of commitment.
Gary Brode: Okay. And I just want to clarify something there because I got a little confused with it. If the contractual obligation is $3.3 million, and I'm just gonna say for the purposes of this conversation, I'm not trying to back you into a corner, but let's just say hypothetically, you guys started collecting revenue July 1. Does that mean you expect to collect $3.3 million from that contract this calendar year? For half of that because you'll have been collecting revenue for half the year.
Ed Sellitto: We would recognize all of it in the first contract year. And we would just recognize it in the period between when they start to go live and when the contract year ends.
Gary Brode: Got it. Okay. So, basically, you are anticipating collecting $3.3 million from this contract in the second half of this year.
Ed Sellitto: Yes. That's a fair inference.
Gary Brode: Yeah. Okay. Well, that's incredible given the revenue number you guys just posted. That's really good news. Okay. And then on the NEC deal, I know with IDX, the implications are enormous. Are you guys able to talk at all about a booking estimate, a guaranteed minimum revenue, term of the contract, or when you might start providing services or collecting revenue? Can you give us any detail on any of those things?
Rhon Daguro: Yeah. I'll take that. Unfortunately, not at this time. So we just released the product. We have the technology looking to go into certain customers for a pilot. And we're trying to still flush that all out and trying to even understand the deal cycle and deal motion and what the pricing terms are. So we don't have that all flushed out. I do have my own ambitious goals that I want to achieve. But I need to put some more formula behind that. So we'll share that as soon as we can. But they're excited to get to that point here shortly.
Gary Brode: Okay. Then let me ask the question in a different way. You guys were at $2.2 million in bookings so far this year. And I believe that includes the Proof deal. And then you got the YeniQ deal, which is an unspecified number, and then you talked about a UK Fortune 500 retailer or a Fortune 500 international benefits company. Are you still comfortable with the $18 million of bookings that you talked about the last couple of quarters?
Rhon Daguro: Yeah. Absolutely. Absolutely.
Gary Brode: Okay. Got it. And then the last question I've got for you is I know last year you guys had some delays and spent a lot of time and money upgrading the software to enterprise capable. Is it reasonable to assume with the Proof deal and the NEC deal that work is done to a level that you're satisfied with, or is there still more to do?
Rhon Daguro: It's done to the level where we can win deals. There's definitely more to do. And so we're learning more as we go into these larger enterprises to see what adjustments and stuff we need to make, but it's not nowhere near the major overhaul that was required to release basically two brand new products, two brand new SKUs into the marketplace. It's tough to just do one, but to do two in such a short period of time is obviously really tough. But at the same time, it was what our customers needed and wanted, and nobody was fulfilling it. So we think we made the right adjustments.
I know we made the right adjustments, and that's how we're able to enter these particular large opportunities and have a really high probability of winning them.
Gary Brode: Okay. So you're more in the kind of normal R&D phase as opposed to the oh, crap. We have to overhaul the whole thing. Phase where you were last year.
Rhon Daguro: I like the way you worded it. But, yes, it's not the holy crap anymore. It's a, hey. This is working. It's stable. Like, one of the things we described in my comments was we were in these pilots and POCs, and now we're advancing past them. It's because the product has been showing very, very well for our customers and clients. If those pilots did not go the way they needed to go, then obviously, we'd be in a different situation. That's opposed to moving to finalizing and then moving things to longer-term relationships with these customers.
So the product is working very well in that regard, but we're absolutely not slowing down on innovation and improving the product sets. Just like with Privacy Key, we wanted that one to 1 billion false match rate. We wanted that 22 milliseconds authentication. We wanted all that speed. And then our customer said we want to also scan thousands of faces. We wanted to pinpoint Gary's face out of this entire population. Can you do it? And, of course, we weren't gonna say no, so we did. We did it, and we delivered it, and the customers were happy.
Gary Brode: Got it. Okay. Thanks for the clear straightforward answers, both you and Ed. Again, I'll step back and let somebody else ask questions. Thank you.
Rhon Daguro: Thank you.
Operator: Our next question comes from Dean Cedercoos with DeCA Capital. You may proceed.
Dean Cedercoos: Hi. Congratulations on the quarter. It looks like you're making good progress. I was wondering if you could elaborate on the pilots. It would be nice to have some idea of the scope. Can you comment on that? You know, how many customers or employees are part of some of these pilots? That's one. And then number two, how quickly can these get scaled up? What's the go-live process? And the time to revenue compared with the normal, you know, twelve to eighteen months? How short is it once you sign a contract with these that you've already piloted to actually going live and getting revenue?
Rhon Daguro: I'm just trying to remember all those parts, Dean, so thank you for the question. This is an area that I'm super fired up about because right now, when we were doing traditional, let's say, sales motion with large enterprises, they have a committee that says, hey. You need to go through vendor supplier. And then what we need to do is put you in a sandbox, and then we're gonna do a proof of concept with maybe five to 10 users. Gonna probably run a couple of tools, make sure you don't crash.
And then based off of the POC results, which is usually unlimited data, they're gonna go ahead and make a decision, and they'll either go for AuthID or not. And we've been successful with those POCs. But that time period can go anywhere between, you know, three to six to nine months just because you're in a large enterprise. We made a change and I know and I want to take full credit for it, but I also want to recognize what's happening in the marketplace. The marketplace has been very good to us with AI causing all kinds of problems and havoc.
And so for these companies to evaluate the technology faster, instead of doing that POC that I just described, they're saying, hey. You know what? Instead of putting you in a sandbox, let's put you in the real production live environment. Let's put you in a full-blown production live environment on live data centers that are operating our current existing systems today. But what we'll do for the test, instead of rolling it out to let's say, 100% of the population within that organization, we're gonna roll it out to 1%. Then 5%, then 10%. And so right now, for our customers, that could be, you know, tens of thousands of people, which is why we're pretty fired up.
And when they see the performance live, that means that if they want to move forward with AuthID, it's a flip of the switch. To go live, and it's a flip of the switch for us to go time to revenue, and it's a flip of the switch for us to be able to not have to worry about, you know, making sure the integrations work, all the testing work, or any of that stuff. So for us, that's the right way to go. We've been trying that. We've been successful. We don't know if that's gonna be the standard moving forward, but heck, we're gonna darn try.
But it does require our team to be 100% staffed for that customer upfront on the deal as opposed to, typically, they're 100% staffed after we close the deal. Because if we have a forecast to close the deal, we then know how to staff up and ramp up. If we're trying to put all these resources in the beginning, it's gonna be a lot tougher. We're gonna spend a little bit more money. But we're finding that's the faster way for time to revenue. So we're sorry for the long-winded answer, but we're figuring that out. But we believe the shift to pilots is gonna be a good way for us to go to a time to revenue faster.
Dean Cedercoos: That's great. So what it sounds like is you've done a lot of the plumbing work already that you would normally have done over that twelve-month period or even more in some cases to get to the full BAR number.
Rhon Daguro: You nailed it. You absolutely nailed it. Those pieces and areas where y'all have been asking us to figure out how to go live faster, right. This was one of those key ways that allowed it to happen. And, again, I like to take full credit for it, but no. Because a lot of our customers are getting hit right now. And they don't have that time to do the POC way. They need to figure it out now.
So I think in combination with AI rising, so if the bet is AI is gonna get better and better and better to help these fraudsters perform more damage faster and faster and faster, we should be able to accelerate our side. So the danger on our side is do we have to staff? And so we have to be able to make sure that we can do that and do that and predict that and again, be mindful of our spending. But that is a shift in our process. And it may require, hopefully not, but it may require a little bit more resources upfront.
Dean Cedercoos: Okay. Well, that was gonna be my next question. Well, actually because you're asking about scale. Right?
Rhon Daguro: Yeah. And that is I mean, it sounds like you're on the cusp of being able to really get some revenue in here or at least convert this to real ARR very quickly between these pilots converting to contracts and going to revenue much faster. And number two, the Proof deal and this without even really getting into the NEC deal, which sounds huge, but a little earlier stage. And are but are you also in pilot with anybody with that technology or not really yet?
Rhon Daguro: On the so okay. So there are two parts there. But I'll answer the last one. On the IDX side with NEC, we're not yet. But we're moving into those, and so we're working diligently on that. But another, I guess, guess that when you're talking about Proof, were you asking whether we're integrated there? Because I'm not sure.
Dean Cedercoos: Well, my understanding, at least my interpretation is that could be almost plug and play with the Proof customer database that's already there since you I think I heard have essentially integrated with their system or I don't want to put words in your mouth. That was just my interpretation.
Rhon Daguro: Yeah. Yeah. Let me go back. So, like so with Proof, it's like a two-part partnership. Part one is our stuff that works today out of the box. And their current customers, right now, Proof doesn't do what AuthID does. So the Proof customers can benefit from the AuthID technology through the Proof platform. So that they can take advantage of that today, and that's what's about to go live hopefully soon. The longer-term strategy for Proof is to incorporate biometrics inside their entire core platform. Essentially like an OEM. And so that has not been completed yet. We're still working on that with them.
And, again, I'm not gonna reveal their strategy with that, but from a biometric perspective, we are working with Proof to be their core biometric technology.
Dean Cedercoos: Okay. Well, thank you. I think that's all I have for now.
Rhon Daguro: Thank you.
Operator: Next question comes from Kelsey Jones with Verana Capital. You may proceed.
Phil Brennaman: Oh, it's not Kelsey Jones. It's Phil Brennaman. Kelsey works with me. My question hey, Rhon. Very interesting quarter, clearly. My question I'm not one who typically asks questions, but I think the question I have is probably a little bit on the forefront of many investors' minds. I'm gonna put it out there and see what your response is on behalf of, I guess, all of us. First, shout out to Gary Brode for helping open up the conversation here. Asking good astute questions. So your organization, you and your team have received a fair bit of criticism about the communication or kind of lack thereof. Evidenced by the company.
And even while understanding that there is tension between your counterparts, your clients, and what you can reveal versus what we want to know as investors. Have you guys given some thought about how to upgrade the paradigm so we don't feel so, bluntly, kinda completely lost by rather Anadyne press releases?
Rhon Daguro: Yeah. Absolutely. Thank you, Phil, and I appreciate the question. And, certainly, empathetic to the request. And so what we've done internally is we've set a process where we know that there's a blackout period, which then the investors don't know about that. Then we haven't set up time to speak with the investors in a dedicated way. So either the investor reaches out sporadically to the leadership team. We then have to figure out how to work that into a schedule because the leadership team is very we're over we're overstrapped here. We're overworked, and hopefully, you can appreciate that. So sometimes we can't respond in a way in an ad hoc moment.
So what we are going to do and what we started to do after this call is that we are reaching out to those folks who have asked questions in the past. We could not answer due to the blackout period for our internal policy. We are reaching out. We're scheduling time with people like yourself in a dedicated way where you can spend intimate time with me and the leadership team to ask questions and get more details for the questions you have. As opposed to kinda like this, you know, reach out whenever you want to reach out and hopefully, we respond whenever we can. And maybe we respond quickly.
Maybe we don't respond depending on what the time period is, whether it's a blackout or not. So we want to schedule the time with you all. And then have a better cadence in that way so it's more predictable. And then I could actually spend more intimate time with you when I'm not in a blackout period and answer your questions. So we're hoping that will alleviate that. Some of that is it will be helpful, but bluntly, spending a lot of time answering my questions doesn't help the business grow, so I'm not really interested in taking you away too much from your primary duties.
I'm speaking more to the press release communications, the information that's provided in these press releases that we're all scrutinizing probably too closely, but nonetheless, it's all we have traditionally gotten. And they seem to they tend to be quite bereft of helpful insights. That's what I'm really speaking to. Like, I would love to hear the dulcet tones of your voice more often, but, really, for everyone's benefit, do we get more information in these press releases so people can feel at least somewhat satisfied that things are progressing nicely. Other than hey. We have this, and you know, we're not gonna tell you what it is. So just take our word for it.
Rhon Daguro: Phil, if my customers would allow me to tell you the details of the contract, the financial terms that you're looking for so that you can make an investment, I would tell you this. Our customers will not let us do that. So to the point where we can get that information so that we can share, we're gonna work really hard to get you that get you what you need while making sure that we adhere to our customers' privacy.
Phil Brennaman: Well, I understand. There's obviously tension on the other side. I would just ask you guys to pay as much attention to providing that additional information as you can. So with that, I'll let it go. I'm sure Gary is back in the queue. And I'd like to hear what he asks.
Rhon Daguro: Thank you.
Operator: Thank you. At this time, this concludes our question and answer session. I would now like to turn the call back over to Mr. Daguro for any closing remarks.
Rhon Daguro: Well, thank you, everyone, and certainly thank you for the questions. Thank you for listening today. If you have any further questions about our progress like I talked about earlier, definitely reach out to [email protected]. We would gladly set up time to be able to answer any additional questions that came from this call or post-call that we didn't answer. And if not, we look forward to speaking more with you when we report our third quarter results in November. Thank you, everyone.
Operator: Thank you. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation.