authID (NASDAQ:AUID) reported higher first-quarter revenue and said it is cutting costs while pursuing larger enterprise contracts, as management framed 2026 as a year focused on converting proof-of-concept activity into production revenue.
Chief Executive Officer Rhon Daguro said the first quarter represented “an inflection point” for the biometric identity technology company, citing actions to strengthen the balance sheet, reduce expenses, advance product capabilities and expand the enterprise sales pipeline. He said those efforts are expected to improve business performance over the remaining three quarters of fiscal 2026 and position the company for a stronger start to fiscal 2027.
Revenue Rises 62% Year Over Year
Chief Financial Officer Ed Sellitto said operating expenses were $5.0 million, compared with $4.7 million in the first quarter of 2025. The increase was driven in part by a $0.5 million rise in year-over-year stock-based compensation expense, along with what he described as the continued stabilization of employee and vendor expenses.
Net loss for the quarter was $4.5 million, including approximately $1.0 million of non-cash charges primarily tied to stock-based compensation. That compared with a net loss of $4.3 million in the prior-year quarter, including $0.5 million of non-cash charges. Net loss per share improved to $0.28 from $0.40 a year earlier and was flat with the fourth quarter.
Adjusted EBITDA loss, a non-GAAP measure, was $3.4 million in the first quarter, compared with $3.9 million in the first quarter of 2025.
Cost Cuts and Bridge Financing Extend Runway
Daguro said authID began a targeted reduction in operating expenses in the second quarter of 2026 that is expected to generate approximately $3.5 million in annualized savings. He described the move as a strategic reallocation of capital intended to focus resources on higher-value activities while preserving operational and technical capacity through organizational efficiencies and AI automation tools.
The company ended the first quarter with approximately $1.2 million in cash. Cash used in operating activities was approximately $3.4 million, compared with approximately $5.4 million in the first quarter of 2025.
In late April, authID secured $4.2 million in bridge loan financing. Daguro said the financing is intended to allow the company to continue working through long enterprise procurement cycles and support efforts to convert its pipeline into contracted revenue. He also said the company’s financial advisers continue to evaluate strategic opportunities, including capital markets initiatives, partnership structures and other alternatives aimed at enhancing shareholder value and supporting long-term growth.
Pipeline Includes Large Enterprise Prospects
Management emphasized the company’s proof-of-concept pipeline as the key driver of its forward revenue opportunity. In prepared remarks, Daguro said authID was actively engaged with more than 12 prospective customers across retail, banking, fintech, crypto, industrial and chip manufacturing, and healthcare. He said the pipeline includes top-three companies in retailing, banking and technology hardware.
During the question-and-answer session, analyst Ricky Solomon of Wilmot asked for more detail on the proof-of-concept activity. Daguro said authID had “roughly about 20” POCs on target and described them as involving top companies within their respective verticals. He said the organizations have thorough vendor onboarding processes and that authID is competing directly against other providers.
Daguro also highlighted channel partners as a contributor to pipeline development. He said nearly half of the company’s largest pipeline accounts were sourced through channel partners, including Formula Five and MajorKey, both of which he described as Microsoft ecosystem specialists.
RPO, ARR and Bookings Metrics
Sellitto said remaining performance obligation, or RPO, was $2.0 million as of March 31, 2026, down slightly from $2.2 million in the fourth quarter. He said the decline reflected recognition of contracted revenue in the first quarter that exceeded new customer contract commitments signed during the period. The company expects RPO growth to resume in the second half of 2026 if proof-of-concept tests are completed and key enterprise deals are signed.
Annual recurring revenue, defined by the company as recurring revenue recognized during the last three months of the relevant period multiplied by four, was $1.9 million at the end of the first quarter. That compared with $1.8 million at the end of the fourth quarter and $1.2 million in the same period last year.
Booked annual recurring revenue, or BAR, signed in the first quarter was $0.08 million, compared with $0.01 million in the first quarter of last year. Sellitto said committed annual recurring revenue represented 38% of reported BAR, while estimated usage above commitment represented the remaining 62%.
Quantum-Resistant Biometric Platform Launched
Daguro also discussed authID’s recent launch of what the company calls a quantum-resistant biometric authentication platform. He said the PrivacyKey platform uses NIST-standard quantum-resistant encryption algorithms and cryptographic key sharding, which distributes key segments across separate storage locations. He also said the platform generates and destroys cryptographic keys and biometric data upon transaction completion, meaning no biometric data is stored.
Daguro said authID is in discussions with one of the world’s largest banks regarding testing and deployment of the capability. In response to Solomon’s question about the company’s technology stack, Daguro said enterprise prospects had been asking about quantum-resistant capabilities in requests for proposals over the past several years. He said authID does not know of another purpose-built quantum-resistant biometric authentication solution currently in the market.
The company also said it added support for biometrically secured digital IDs, including mobile driver licenses, as well as verifiable credentials. Daguro said the capability is intended to help consumers establish a biometric “root of trust” for onboarding to platforms such as banking, retail and healthcare services.
Management said the combination of revenue growth, cost savings, bridge financing, product advances and enterprise pipeline activity creates the conditions for authID to pursue cash flow sustainability and long-term financial independence, though the timing of large enterprise deals remains dependent on extended evaluation and procurement processes.
About authID (NASDAQ:AUID)
authID (NASDAQ: AUID) is a technology company specializing in digital identity verification and biometric authentication solutions. The company offers a cloud-based platform designed to help organizations securely verify user identities, prevent account takeover and reduce fraud. Leveraging artificial intelligence and machine learning, authID’s software supports biometric modalities including facial recognition, voice verification and liveness detection to ensure that customers are who they claim to be.
The company’s flagship product suite enables enterprises to integrate identity proofing and continuous authentication into their online and mobile applications.
