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Revenue: SEK18 million in Access for Q3 2024, up from SEK16 million in Q2 and SEK9 million in Q1.
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Gross Margin: 38.7% when excluding R&D depreciation of SEK21 million.
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Adjusted EBITDA: Negative SEK22.8 million for Q3 2024.
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Free Cash Flow: Negative SEK27 million, including operating cash flow of negative SEK25 million and investing cash flow of negative SEK2 million.
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Cash and Cash Equivalents: SEK49 million at the end of Q3 2024.
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Headcount Reduction: More than 40% reduction since the end of the previous year, with a 10% reduction quarter-over-quarter.
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OpEx Target: Less than SEK70 million by June 2025 on an annual run rate basis.
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Debt Status: Debt-free after repaying all outstanding convertible bonds.
Release Date: October 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Fingerprint Cards AB (FGRRF) has successfully executed a transformation plan, resulting in improved gross margins by exiting unprofitable markets like mobile and PC.
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The company is now debt-free after completing a rights issue and removing convertible bonds, strengthening its balance sheet.
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There is strong sequential growth in the Access business, indicating robust performance despite transformational changes.
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New product launches, such as AllKey and the latest IRIS technology, are expected to drive future growth in Access and Payments markets.
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The company is actively exploring new partnerships and M&A opportunities to expand into the broader identity market, focusing on software-rich areas.
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Revenue has decreased year-on-year due to the strategic exit from the mobile business, impacting overall financial performance.
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The PC business is facing increased headwinds and commoditization, leading to a decision to exit this market as well.
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There is continued volatility expected as the company undergoes a significant transformation, which may affect short-term stability.
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The Payments market has been slow to take off, with pipeline movement not progressing as quickly as anticipated.
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The company is experiencing challenges in the China market, which is highly competitive and cost-focused, leading to strategic exits.
Q: Can you talk a little bit about the timing of the wind down of the PC business? A: We’re starting to wind that business down immediately. It’s something we’ve already begun, and we expect it to move quickly. We aim to do this with respect for our team and customers.
Q: What has changed in the PC market to prompt this swift exit? A: The PC market has become commoditized, similar to mobile. There’s an oversupply, allowing customers to easily reallocate volumes, which is unsustainable for us. Additionally, the constant need for innovation at lower costs makes it untenable. The competition between using existing camera infrastructure for identification versus adding fingerprint sensors has also intensified.
