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BIO-key Q3 Software License Fees Grew 39%, Its Third Consecutive Quarter of Double-Digit Growth, Driven Primarily by Momentum in the Middle East and Europe; Hosts Call Today at 10am ET

BKYI
  • BIO-key International reported Q3 2026 total revenues of $1.48M, a 4% decrease from $1.55M in Q3 2025, while license fee revenue rose 39% to $1.3M.
  • Nine-month 2026 revenues grew 14% to $5.5M, driven by a 37% increase in license fee revenue.
  • Q3 2026 gross margin improved to 90% from 77% in Q3 2025, marking five consecutive quarters of blended gross margin growth.
  • Net loss for Q3 2026 narrowed 8% to $(886K) compared to $(965K) in Q3 2025.
  • Net loss for the nine months ended September 30, 2026, improved 42% to $(1.7M) from $(2.9M) in the prior period.
  • Working capital increased to $3.1M at the end of Q3 2026, up from $1.4M at year-end 2025.
  • The company retired its remaining note payable in Q3 2026, leaving it effectively debt-free.
  • BIO-key added three new government customers in the Middle East in October, totaling eight new regional customers in the past seven months.
  • A partnership was established with Al Majlis Group to expand identity security across the Arabian Gulf.
  • BIO-key integrated its solutions into the cybersecurity portfolio of Cipher, a Prosegur company, starting in Portugal with plans to expand to Spain, the U.S. & Brazil.
  • The company received FIDO Alliance full certification for Passkey:YOU, enabling biometric approval for AI agent actions.
  • Revenue from the Europe, Middle East & South America (EMESA) region grew 39% in Q3 2026, with license fees more than doubling.
  • Software license fees represented 86% of total Q3 2026 revenues, up from 59% in Q3 2025.
  • Hardware revenues dropped to $12.4K in Q3 2026 from $363.6K in Q3 2025 due to fewer hardware deployments.
  • Operating expenses increased 4% to $2.16M in Q3 2026, while research, development & engineering expenses decreased 7%.
  • Stockholders' equity improved to $6.54M at September 30, 2026, reflecting $2.5M in gross proceeds from a warrant inducement transaction.
  • BIO-key anticipates a strong finish to 2026 & a strong start to 2027 supported by government wins & a growing pipeline.
Company
BIO-key International, Inc.
Keywords
Nasdaq:BKYI, BIO-key International, Inc., Earnings Call, Microcaps, Biometrics, Digital Identity, Identity Access Management, Multifactor Authentication, Software, CyberSec, IAM