INVE Identiv

Steven Humphreys Chief Executive Officer
Sandra Wallach Chief Financial Officer
Mike Latimore Northland Capital Markets
Nehal Chokshi Maxim Group
Call transcript
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Good afternoon. Welcome to Identiv’s Fourth Quarter and Full Year 2017 Earnings Call. My name is Vicki, and I will be your operator this afternoon.

Joining us for today’s presentation are the company’s CEO, Steven Humphreys; and CFO, Sandra Wallach.

Following management’s remarks, we will open the call for questions.

note non-GAAP this adjusted measures please make management EBITDA. begin, to references or we that call, during may Before projections, including

statements. is of from these future In be including differ financial to call, materially the future events, statement. projections Any market forward-looking Actual and forward-looking may conditions, expectations, characteristics addition, in refers forward-looking statement statements. those other management or expressed projections that a during making will results

in refer Steven company’s to to XXXX. from proceed. the turn Form For documents more speak conference discussed the the filed no update to to factors including Sir, XX-K please for information, which now statements, annual the over as with time obligation Humphreys, please comments. forward-looking Identiv assumes year time his today. risk of will on CEO, these for SEC, fiscal report I

Steven Humphreys

and Thanks, joining one This is for Vicki. everyone, our Good in you most for afternoon, and thank us. moments company the good of evening, exciting years.

well is went end also and year XX% This behind We turnaround the growth the sequential came and first Our QX in of in growth QX years. the right is growth year sequential growth. that at year-over-year X% fastest the out with over organic organic of the us.

can in they’re volume more [Technical the Difficulty] We products had XVR of [Technical last growth in since for versus delivered and across The and this also their important total positive transponder first their broad-based. entire well acquisition pure adjusted analytics company. such revenue our we’re expanding, in years is initial anticipating Difficulty] we full time our platform [Technical the year, year leverage XX% EBITDA of company, Difficulty] applications XXXX. growth over both and XXXX. first year Add success and that to products across video this groundbreaking most

line expansion, the our initial customers additive become growth all new product to winning in cycle of of expect revenue space products, the and follow we same which then also who base. We’re will

government readers design-ins growth security card smart across major and technology even payments leadership support applications, Our in XXXX. some are new continuing their that

business been of Our and key now a market our our natural augmented has customer core Cisco technology had with wins expansion government and especially and fit Premises channel video analytics. across federal

There each about million every and day. and would Since and law old-fashioned worldwide XX guard only security have police them the similar disparate the and officers, base. solutions is our huge information. analytics then actionable opportunity. to them, and This in we’re it’s positioned, where provide unsustainable officer cameras electronically to be way. me watching prevention it, a core take is XX problem over about let couple focus you sell take there, on core drive last near granted data. RFID and our To activated a think X.X about platforms. this over data be of applications term XXX Now longer events analytics. video access million more billion minutes of in real XXX But doors billion the and we guards to are feeds, data monitor when generating doors and an a non-stop more situation is more are XX access term, loss to over transponders, XX is points, there part now daily out obviously connect in addition security number of enforcement clear, petabytes over cameras If apply This

and loss by security then torrent clear, and opportunity These ahead. it control, growing to earlier, pure the business is we into tracking turn of data is as this, are intelligence we’ve our core businesses near-term other have driven RFID our granted monitoring analytics video stronger but prevention said seen, to the business top massive this of useful, on make I access events. security be to business As provide access and

is platforms vendor it. any that this who the position highly this their be By deeply huge, we’re generate data competitor all not time real competitive to business value understanding data, best set in disadvantage. a business or to and ours of the valuable part is model positioning of going on of in Now major manage

by Additionally, technology prevention, the as as a data of skimming experience deliver vertical top value of solutions we having to already more, and now, line applications queue and management, ready-made credibility across proven the loss set on information well ATM stream. have the

of solution, needed to the is help always, as a several others. business, this in healthy been to always of integrated team, the fulfill a do, the a we’ve capabilities infrastructure, a financial So lot complete infrastructure stable elements work including solutions services solid place, get where but We and core implement there’s And plenty technology launch headed. weeks to ahead a in few very to configure weeks do and shows month ingredients are completion and substantially The news improved we’ve results place quarter in the through months. numbers terms more as the availability debt in especially of the Services coming Global the the Identiv ago, the fourth and now. in XXXX a and this combination with a the ago, the XVR announced of and

quarter Sandra? introduction context, over Then I’ll turn to us and back the cover the business I’ll this the take in to of to through the depth. results call in Wallach, financial Sandra for come full details with our So CFO, more the year.

Sandra Wallach

quarter for Steve, the million fourth of market, our set for financial Thanks, with million the we range provided year $XX.X and of in February total the and the context after XXXX. the close fiscal results preliminary results to $XX.X million the providing million for a full XXXX. of On $XX.X for revenues to for XX, fourth quarter year $XX.X

fourth $XX.X committed. of quarter a with third compared in EBITDA provide million in $X.X fourth as million quarter the million Today, an from and adjusted increase the fiscal XX% $XX.X $X.X we million Our quarter for to million, million million $X.X to XXXX. ranged Revenue and in the preliminary quarter sequential fourth of $XX.X compared results $X.X financial non-GAAP year X% was full for XXXX. will XXXX increase with

For Difficulty] came results the X% QX our only but case. year, in in recorded the been not Difficulty] revenue we stated especially from our within the from at quarter perspective, increase XXXX. has million $XX.X historically guidance, Difficulty] fourth [Technical [Technical guidance $XX.X top million, within sequentially, not line range full which a previously [Technical

Our and strength progress. XXXX our solutions our represents and reestablished with [Technical businesses full believe in based we and that our our year Difficulty] on [Technical over growth having emphasizes online new core partners Difficulty] relationship the channel customers continuing growth XXXX technology and XXXX in

in a million and from In strong generated in Difficulty] XXXX, [Technical quarter give lines the third X% increase of sales, driven in full [Technical readers, quarter product XXXX. sets a of of our professional primarily of a This and fourth in fourth of slightly partners the quarter addition, quarter offset software quarter third with I’ll software few a quarter the $X.X million million revenue million fourth and year couple [Technical up a healthy the for card percent, backlog $X.X sales revenue and we Premises start. X% Identity $X.X in of segment the basis, Difficulty] XXXX, entered XXXX premises $X.X chip $X.X engagement From primarily of increase modules Difficulty] an of higher total our of services of a sequential higher of million [Technical smart in in decrease million sales million XXXX Difficulty] million $XX.X XXXX. from by products, the XXXX. for our represents On [Technical computer sales comparable premise with revenue record recorded $XX.X and channel by segment. was readers. lower revenue Difficulty]

card were APAC revenues in by These million, our For of Credentials smart our products. fourth up revenue changes higher in lower partially $X.X and segment offset smart in quarter and or the Americas. the readers XX% XXXX decrease which transponder sales full and EMEA represents segment, million card performance $XX.X card year, the million million reader a credentials XX% of in $X.X regions, access recorded quarter comparative quarter from fourth third from derived sales sales of of in Approximately from was of our from the $XX.X XXXX. sequential XX% in Identity the comprises revenue a X% increase of This reflect XXXX. recorded both $X.X million

Credentials primarily in market growth robust year, in XXXX. million $XX XX% in changes continue from XXXX $XX.X NFC from million revenue home we apparel due million $X.X to applications were security. transponder volume full – the the broadly for For or as sales These to increased shipment benefiting worldwide, shipments and

fourth XXXX the in digital XXXX. disclosed, All As segment revenue result year as phasing fourth lines of full in of of line our our of previously the CHIPDRIVE quarter Other stated discontinuation have the product and media and and we product out no in quarter our a

turning Now our margins. gross to

On fourth compared compared in XXXX gross year-over-year of the QX XXXX. in our one-time fourth in with in quarter profit in was quarter gross the the and Both use a quarter-over-quarter gross a at XX% margin decrease XXXX margins the product. with company’s relationship, of third result associated were basis, XX% XX% of end with XX% in compared decision XX% in inventory the was primarily profit quarter GAAP fourth customer items, our the margin and quarter transponder-related adjustment third and and GAAP XXXX. which the a quarter non-GAAP full for XXXX GAAP ended the other in non-GAAP fourth plans quarter XX% non-cash excluding in is gross On reserve certain sequential XXXX. alternate basis, year discontinue XXXX with to margin the XX% the of Our and XXXX the XX%

predictability XXXX. quarter-over-quarter quarter-over-quarter Premises attributable increase period. increase margins margin full in performance across comparable lower-margin in progress in margin year, the non-GAAP target growth Identity decrease results is and versus meaningful Credentials was margins segments, that toward and to we versus XXXX These segments our the we product are our gross non-GAAP achieving attributable segment model. in sequential our our prior our in The in in the more XX% make For long-term mix XX% with as to non-GAAP in indicate an higher was

in Now expenses, next the which moving graphic. operating to is

operating the our for $X $X.X quarter quarter third million in For comparable of million million of the expenses compared fourth XXXX the XXXX, total earnings were in of our $X.X and XXXX. with release, quarter GAAP

loss severance transponder-related on charges normally excluded impairment such charges of consisting from Our exclude to extinguishment costs items reserve certain as the of acquisition-related amortization, and a non-cash quarter non-GAAP in inventory well and and and depreciation adjustment transaction non-GAAP restructuring our as XXXX. operating compensation, stock-based fourth debt as additional and non-GAAP costs of adjusted results expenses,

occurred $X.X certain legal connection primarily insurance our from operating nonrecurring in of increase for non-GAAP reimbursements $X.X driven with was quarter-over-quarter in certain incurred XXXX. providers million in that were the Sequential expenses QX. Our million and quarter in million by million $X.X $X.X legal the prior compared fourth of as quarter matters with fees

total versus the our in $XX.X For in charges $XX.X a incurred result XXXX. million restructuring severance fiscal fiscal This incurred XXXX million while expenses full primarily year, were non-GAAP XXXX in none in and were of was operating XXXX. decrease

expenses XXXX, areas the highest $X non-GAAP fourth to marketing the $X.X as in total quarter year of was with cost for in existing million the For keep of and million spend our in quarter of and quarter fourth million On quarter the expenses and the $X to with commitment infrastructure. XXXX XXXX. in first XXXX primarily were sub X% we of $X.X leveraging The the able due carefully, quarter of we of revenue, million XXXX $X.X was basis, the OpEx third fourth initiatives decrease XXXX X% managed Sales quarter resources XXXX. in per compared of in restructuring year-over-year at remained $X.X third $X.X undertaken reallocating worldwide million million representing to line growth XXXX. and a quarter respectively. million, and were versus Full our R&D quarter fourth XXXX in

professional which certain decreased expenses million legal included reimbursement in by On which in sales X% increase insurance our For decreased $XX.X million to or was G&A primarily year, legal million in and spend to reduction the of fees income to G&A incurred the of reduction primarily year-over-year. quarter and prior from fourth XXXX lower look in the third The million to was XXXX. quarter and decrease due $X.X program XXXX XXXX, The release. expenses $X.X fiscal a at $X.X in XXXX. XXXX. a fees strategic $X.X the from our basis, provider incurred in in legal million fourth million million full in compared year $X.X full with our statement our with marketing in and in for full were from the per We expenses now in $XX.X $X connection approximately matters earnings the refocusing, year-over-year $X.X quarter period. in million resulted million due marketing headcount

loss loss $X.X in quarter and gain million third in net in comparable XXXX of in $X.X $X the of a adjusted quarter XXXX in XXXX GAAP Our compared of million quarter fourth EBITDA million was XXXX with $X.X a for million million quarter of with quarter compared XXXX. loss XXXX non-GAAP was fourth and third $X.X the million Our the $X.X

For the in our gain was to XXXX adjusted full of loss XXXX. $X.X EBITDA year, adjusted a in $X.X non-GAAP non-GAAP million million compared EBITDA

fourth point. approximately quarter for a XXXX. fourth full and to few as our $X.X of also XXXX. was million of non-GAAP and release. XXXX $X.X There is expense of reconciliation QX On at compensation earnings four worth Non-cash of million GAAP for the next also are Interest QX stock-based third results, we XXXX was included quarter our page, provided and the quarter approximately noting items this as well of which in

in Additionally, expect fourth acquisition-related transaction related and million of we quarter of on million transponder debt related adjustment, charges approximately of term We $X.X one debt quarter restructuring extinguishment connection the plan. December. loss of incurred costs a the was implementation restructuring XXXX $X of of not that in the $X.X in further and inventory to reserve with XXXX done million a WTI one the incur prepayment the in any do half to

on Annually, line EBITDA On our the prior with delivered any and rate of the adjusted quarter basis. fourth matching trended page, growth top XXXX revenue a growth up XX%, exceeding we next quarter our non-GAAP achieved. on

infrastructure to $X.X grow our the non-GAAP compared of results additional stable losses and of previous without million to Our adjusted EBITDA exhibits to cost. ability year’s our

September XXXX. XXXX million Net of December generated noncash amounts the will the small Cash quarter $XX in our XXXX. our XXXX issuance was we if the and loss, usage comprised turn was of million of Now to a be exchange. impact million, fourth proceeds million end comprised $XX.X of at as position of cash increase from an convertible primarily the capital in of last net of The end of $XX.X comparing items, foreign our and partially by at the year a one increase the balance excluding the position in sheet, $X.X financing had preferred totaled at well December quarter $X.X the driven impact we at for net million the assets million from could stock $X.X the December loan. as under offset cash $X $X.X operating by compared XXXX to paydown use $X.X again million the in million primarily outstanding liabilities to I ago expenditures. million cash of from of net very a And cash activities quarter of of term ended

XXXX page, December XXXX. the to next comparing December On now

XXXX December $X.X at million approximately December XXXX. million $XX.X $XX of cash at reported increased from Our million

an in and primarily of by net was $X $X.X driven year non-cash in full totaling increase capital activities, liabilities, comprised $X million assets full $XX.X usage cash net million and the increase excluding operating for million. loss, expenditures cash of our in activities million offset net financing and by of usage items year cash a Our

$XX.X proceeds the quarter to million second of full included addition stock XXXX. activities, issuance in common the the related year of quarter the the In received fourth financing to of

credit million $XX our including from non-formulaic sprint successfully West Bank, sub-limit. million subsequent formulate we cap via addition, $XX taking to million, additional line In to our obtained East in limit order have year-end, a a of provide to our to access more $X with of funds capacity,

balances which We simply driven of XX the in sales of quarters. quarter revenue Our days million the was the September respect at and the the our slide December XX at $XX.X the accounts sheet our Inventory third higher quarterly million to $XX.X full XXXX capital by by December to outstanding With contract of with at at December XXXX, net last XXXX. the build reserves, working in million million XXXX. capital $XX.X accounts higher the receivable, at versus was earnings days payable. XXXX excluded driven primarily associated table increase at quarter The $XX.X in XXXX, December compared less balance XX% transponder-related from September end – customer at the of end in inventory inventory decreased quarter accounts per increased XXXX. release. the the accounts with is from define percentage of of to plus days next $XX.X as canceled receivable as $XX of at XXXX end December at and fourth receivable million working month XXXX Net prior the million

primarily and down other of a by as total reduction and comprised $X.X $X.X and items was X.X of in reduction balance of in from to of our offset Our driven due payables. XXXX. million vendors adjusted by September at compensation greater remains XXXX was approximately professional driven the million X.X are liabilities than of a December turnover legal XXXX balance days September couple of from in items A $X volume. at December out other December accrued compensation, pay million at our and of legal XXXX, at Accrued invoices to million current with and sheet. aged XXXX. legal December decrease over decrease X.X XXX expected $XXX,XXX, with million revenue $X.X aged our employee in $X payables by and at noteworthy fees. million XXXX impact growth in the of $X.X compared higher and from A line amounting expenses payable to fees, to of XXXX inventory December XXXX was less balance significant million payable to XXXX, a $X.X $X.X restructuring in the netting accounts million, the than at payables Accounts December September Comparing

obligation our reflecting offset XXXX addition, from September and payment December In quarterly $X interest. at at made, of $X XXXX, the to of decreased million the million December long-term XXXX by accretion payments partially $X.X at million continued

$X.X $X liabilities on September short-term result million $X.X – moving term The from XXXX XXXX. our more XXXX. long-term $X.X December partial December was a decrease to financial million to moving of our December and of at in long-term of loan of the million and XXXX Our debt decreased of million paydown at

page, a business next context we you the progress, of what have On quarterly the the achieve in closing of out adjusted do: ourselves consolidated to company. for non-GAAP EBITDA in profitability the we six Today, grow with gap the XXXX where our income we our to providing target profitability. quarters guidance model, to measure row, and delivered assess for significantly we’re set net results

million expect non-GAAP $XX be to the We to adjusted results million. range with revenue XXXX of EBITDA $XX $X million to million of range in $X a

For the it And that, completeness on the with non-GAAP reconciliation last of turn Steve page, I’ll over results. GAAP again. full we’ve to included to

Steven Humphreys

All right. Thanks, Sandra.

results demonstrate EBITDA strategy. full foundation the since non-GAAP a as led was the moving midterm of strength increasing which our XXXX We our returned closer target business, has We to model, year of the progress sets basis. for business to on inorganic for Identiv. business, critical our adjusted growth year that an heard, our and major first core strengthened So you’ve substantially really annual growth organic to And strength of XXXX. positive these

our business which beyond. in growth sheet, let has our organic improved to and us providing XXXX and health, business’s inorganic on deliver fundamental any strengthen strength the to our performance Additionally, balance is

in XVR strategy the first of acquisition February. our the in We early also inorganic executed step with

with to our strengthening us, from of demonstrates an business ago, many weeks ultimately, position fast-growing And It’s fit complements in our vision execute especially and a remember few combination and the segment, XVR’s our a XVR strategically, higher-margin ability and market perfectly As of inorganically. beachhead find the complementary update which frictionless the our Premises and strength. it call great security getting in excellent you secure, might a our access. analytics is simple, convenient, video for

accelerating of this in customers I launched dual and initiative businesses, I’ll we organic the XXXX couple our access will into pipeline inorganic. and our an video current segments growth in minutes, to substantial overview, of new of the to commercial our control want Now grow a a last as just approach platform, remainder expansion particular, federal adding just we’re month. be in highlight see our but from really opportunities detail Identiv the contribution conversion our across the in focusing Global Services to cross-selling customers going on core the the of go ones, our through continuation both of from And new segments. leveraging market, to and customers which and across transponder in

success just end-to-end say adoption and IGS So of when facilitates to something catalog I deeper drives And product is catalog our note of that services of want portfolio. customer services. we our

body a dealer, integrator, about talking shop installer not system We’re here.

for that about now, and to into that for in a particularly while, for choices address IT the making. space. security ability concerns in of now player information industry is That breaches the is has IT space. And it talked a positioning physical adoption again well is Vendors’ they’re We’re across over on, talking seeing perfectly on about of we’ve And happening replicably actually security and standard and our coming of the been going rolled as have emergence looked and security that. right anticipated those and core offerings core with security the repeatedly lot here tied happening again. space. we’re that been has is physical for the that challenges some a and We’ve multiple in is technology IGS the on what’s It a affecting deployment decade actually now, us for something to customers. over it’s physical the the

and simply going vendors IT customers who sticking it, address into old people the somehow physical to affecting now business the and other both competitive it’s devices seeing actually their and not the The to. and about it’s talking real issue hearing model, don’t is we’re we’re Those who act connected we’re aren’t this are security opportunity network who as those if time. addressing displacement and want seeing sales that are to sell

us So it’s for long wanted both actually revenue I we but coming been a has fruition. time there, which to just highlight it margin opportunity for competitive opportunity with gives and that and expansion really talked never to a now about a IGS, expansion briefly. and displacement,

So sales focusing that really organic we’ll integration XVR, leverage technical and the pipeline. is and we’ll the foundations financial also of strategic, growth. makes line aggressively physical of the be cross-selling our Inorganically, into opportunities that to acquisitions be technology And completing other of our synergies, bottom top pursuing on get to on the and including course, sense coming of world. level fully closer business and that already goal are a instrumenting us

that the financial we of took whether inorganic we something business every core part we’re XVR. our However, going approach sacrifice going and That’s transaction, or take. we’re DNA, organic to carry disciplined not that’s it’s through with a to in

accelerating drive grow both and and So to by the to that full-scale our positioned supports we’re and ourselves build growth that organically we’re Identiv inorganically, market opportunity clearly the company the to positioning strengthening company grab. into

and, will supporting XX into segments close growth. large strategy Turning customers by is the as asking which XXXX year. increasing push been work as driven on major be revenue customers to converting what continue to in more now working but see on opportunity get if us, also a And have, not sales don’t are and of a well for some range system not see past growth. system to our our the Driving can, key get not customers are then and years, as in FICAM, upsell now solve been across has we completely the those benefits challenges the can for this vendor into customer We And and product who our months we’re of opportunities looking going creates benefits upsell next even five we’ve a and technologies opportunities. years. course, and detail. to to from than actual you’re we are to I mentioned, over deployments, Premises but initiatives to insight our really fact, in contracts secure our The and that think directly quickly establishing are we ideally this over integrator just larger seeking leverage the that integrators them. more exited with with growth into you we the opportunities. range us is additionally, driver now deployment that. being showed for growth service the the connections they’re you is business positioning execute by where the them them. provide we’re And organic with to in to but Well, order positioned in visibility

beautifully aligned a our Cisco’s range a launches rack which On data our solution, with we had the modules, input our product integration. and positioning, support is side, in of of Cisco Mx-X including partnership, with controller center ICPAM X.X

strengthened key the side, space. well in federal On government we’ve as commercial the go-to-market in industries channel our as

the here the I’ll does Premises complementarity next but obvious, These key cross-selling Now more fit segment. slide, in opportunity, the the that the note but detail our is established on perfectly with ways, bit many XVR technology discuss in a same is I’ll real The customers. strength it just near-term already opportunity. really really in are

their physical merging that into and being access customers, about solution way going security solve in perspective, because integration video dynamic talking valued if our a customers’ our people part now, more by there, control of challenges. intimately have really and entwined inside in a be sell, to for going really we IT IT and some from been control years. their was virtue through, we not speak They I’ve but have same the being broader drive for access of they we issues languages, I and that of happening And can we it’s access they’re control fact, we it pieces massive securities vendor security the want and partner. to to speaking happening And in same organizations, around XVR’s are visiting that can the same much As a that’s become customers, of video. portfolio the in in been and streams we’ve in same the

some use So prior applications in network I’ve very But discussed in fact, federal opportunity the commercial yet concern space the very can calls. IP have retail to control is they And respects, we’ve already They adviser about they providing here. security role government government in products established commercial to FICAM space into some not cases them challenges and services. about you already leverage trusted in of the the and, also as going and we same have largely in can larger IP and and more same many think going access CCTV really compelling. talked a base federal the the imagine, the unless opportunity on install our technology, right issues, deep infrastructure. similar. security in analog this lot is of we But legacy have cross-selling of

I with as as and well mentioned and establishing earlier, product services our opportunities. as both value-added revenues also strategic lastly, So position software are our initiatives customers driving

shipments of RFID transponder the Credentials. high across to had year to applications. due inlays XX% our for and a turning NFC We particular, range strong NFC-related volume Now are In accelerating. growth demand for

their growing expanding and of customers are success year. the over based initial product into on lines now the other launches core Our past

to to leading same solutions that forward-looking to company one their that its others us motivates sector maintain realize successful results, to their as sector competitiveness. come Additionally, build in in a

for when quite go, that is see developers Now platform our updated me One, the really thought can and in edge develop looking is applications. build market and our production what to trusted NFC-enabled to develop, it’s couple continuing to partner are points for to is developer too. launched natural of of and the to with the SDK, SDK just strengthen. they build already kit leader likely NFC that. on, leading where their partnered And they’re into ramp-up. course, data let progressive a continue around to a applications business we independent we companies And an give on They platform TagStar a you through position very as

we which week’s share this Chronicled others. our is little along range I Google just partners, participated, of with event, Another NXP, to anecdote and from a NFC like

give secure learning about which of and a you management, full-stock supply was in partner were packed. with were chain into they is which global customer blockchain platform enabled and and XXX There over we for NFC window people did it a joint the presentation our Just a Chronicled’s room, platform. Chronicled, is to this, ours, transponder by

technologies Now data our fit. solution and and a existing out marketplace cost as there an existing effective, more now. orders this a easier solutions, is right Chronicled, to platform trust creates and with what’s a to were with deploy of leverages is RFID blockchain, natural And secure deploy applications easier in much that that huge interest application already and demonstrating we out lower using magnitude in along the than there

that something the with window little what a already what you vendors this give speaking week. we’re through about into wanted be could can we’re on bunch done. podium examples, space, leading but you doing went So just a I more in just not to on take I just

at Now take before it Chronicled NXP. like to at and like I we’re large scale, deployments aligned Google leaders and – we’re that will and actually full scale always its motherships already clearly seeing but with time thought caution emerge

a sustainable So very we position strong we’re here. in leadership think

modules Turning Identity. and now OEM to identity XX% year readers, strong for chip card payment applications. and for smart the for was due Revenue demand up sets to

and unattended are contactless massive clearly, identities So markets. growth payments secure

of We’re both in position a strong in these.

specific underlying the upswing. a and like Now payments, name card so customers. the RFID OEM on are and clearly largely But solutions, our identity an programs and is category smart business, things design-ins don’t that’s we Identity all markets

technology of many the initiatives industry. in record brought most we’re in promising the deep being on one products, providers track of the As a long of with few successful

think the can I generate. see So of the we streams of all that interconnection solutions the strength the foundation you built our and data across

real when to our video are especially access sort These moment. on shopping, addition conversion and technologies for core part of management, out-of-the-box deliver control rates Premises In a object analytics, including queue when of XVR’s or applications core recognition, consumer turned the I dwell recognition, more. time, brings tracking, benefits heat of segment, facial combined analytics. item plate our just to with maps, into being platform demographics, license this focus they’re strengths, recognition, and want

events. fact, your worlds data, who your this. it’s built challenges we bringing at actually to that of But of picture. trusted and database to contractors access isolated is whitelist, probably, prior stream building. people access virtually These to fundamental together, a these in people. you into employees, from massive been They blacklist Those control list it analytics also, tap be, quickly very just has all the One not this Well, of of typically a get and have video card, it hard a in door cases, beeps, are lets allowed whitelist better by your filter trusted them have already least but in. are

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data security video Access training, we across idea are customer do. here data applications for then of already even about And of whether market loss capabilities these same I’ve that perspective, place. occurs the as two because about the to touch or perspective, awareness analytics I fit, are to benefits very talk integration on in or I marketing whole And in some is the these fact, and control a and feeds the it’s to security earlier. or easy or it’s mentioned paying few technical the implementation So things prevention examples and having to perspective. can those a of talked want and internal of the infrastructure being generate already benefits there’s but leverage a used business, out applications, from again then a just really natural

the database there. have We

discussions correlate card license would plate Another from event. with an piloting have implementation that recognition about access we already

okay Steve’s If to let it’s it’s done. them What maybe and car to if really creates So army his Steve’s it’s onto Steve’s the an does ID, base. frictionless and not car be authentication. probably this multifactor ID, additional needs is check

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As see here, our an systems where in moving can people you on track are can through the picture environment.

an place. are explosion are location sensor the popping platforms starting over Interior this. Now of there’s all help devices to that out

those line already line us all obviously, earlier one we’re to the and location, MAC really control be isn’t yes, short. is them tracking, inventory correlate because going to get a on. that single cases. to service, with that’s long, it, you of that’s brings address We we can have when check love when both management you heat want customer solve as yes, be to solutions all and solution the When get problems correlates access mentioned dominant as in-door all more wouldn’t inventory gets I’ve tracking Our but is management so checkers and where think well automatically video an platform out it capabilities lines belief map come together, Queue interesting that also positioned. things. other the use we

out queues longer actually other maybe is average and being And application across they if initially a training. deployed on it’s through, This go though, for but banking their to additional at ATM Additionally, that for of more taking If areas. then some is one, our obvious minutes, need now they’re retail someone than more dwell some of doing an skimming someone’s something again using time. cash than ATM of ATM. probably is getting a an couple

And correlate. skimming starting the control know, ATM are used again, is So platform bank cards how you to access the you space. often can on the ATM as see one, for into may

the skimming happening. of door if probability know So we have hours, that’s correlation skimming the kiosk, if a anything after ATM reduces cross the it’s exactly open who’s dramatically and a therefore, of into if going event we happen that might problem

build working, we’re when you that technologies. want with of all So deployed understand to to can there that so these a I are about on tangible, we you very applications, talk applications these our top just give expecting of snapshot

the we had XXXX, fourth So growth, year-over-year up, our the in wrap year. summary, really which to out building in came quarter momentum of fastest going of

our half the Our gave company. terms position got nicely our momentum we’ve and a on capital three-year base down preferred debt financial a and XXXX better debt with much great up term going progressing stock scale strength and along renegotiating much better investments, And structure. into and debt, paying revolver growth our our to us really plan

optimize always be model will structure the the things acquisitions, strategy we’re you because like execute to as and inorganic leverage cost in drive our are. opportunities manage our pass to For we to going as beyond, XXXX and continue obvious further the do first what growth

The can the reduction line. got get pass through leverage where and, points in second expenses you’ve fact, you greater allow of can people on utilization but, be actually, to leverage through perhaps not top of

execute strength how So tactics, key have complementary layer business and of on accretive to take drivers. the as most And we’re we’re these businesses. exciting operational come our together to and said But just the years. advantage the the piece platform growth strength beginning the in at for our segments additions XVR and company I and combinations scale a our do as of of strategy. our we moments positioned one well the and of core is technologies all And strongly, performing And with is beginning, inorganic going to business. growth potential financial demonstrated with our really the glimpse in it this we

Vicki, operator. to can the I’ll that, open turn over you it why. you With for So with want you the taken to All through, details hopefully, right. questions? I’ve see


And Instructions] first go Mike Latimore to we’ll Capital Markets. Northland [Operator with

Mike Latimore

Thanks and year. the congratulations on

kind of the in getting or from most cross-sell On see there? near-term you customer products, bookings the the XVR of coming brand-new

Steven Humphreys

obviously, are and dealers customers term ones The and the of in. Actually, that’s already A both. bit we sorry, relationships because that cross-sell, we’re have – with Mike. nearest channels

cycle. have will is cycle why That’s be opportunity then cross-selling to the term cross-sell going will shorter on And a happen. going that what’s just So basically longer sales the be new side. we’re customers sales it into, will a near in

Mike Latimore

you’re sounds kind government, kind Or see is by growing federal percent you the as of the grow year like of do then encouraged of federal revenue? sort of of – it same there holding kind government as there. And I position? what this seeing you’re guess,

Steven Humphreys

Yes, It same particular And good grows question be the on percentage. some of and pace. don’t numbers. cross-selling Probably It’s faster whether in about some the the than opportunities will I services other segments encouraging in we’re growing nicely. keeping pace, it seeing all, Premises on and side, know.

Mike Latimore

depreciation of of a basis and what for like quarter in should then full on And we June kind model quarter? kind the amortization

Sandra Wallach

What’s make question of want sure the I depreciation the heard to right. amount and amortization? just I total

Mike Latimore

a quarterly basis? what like should Yes, on we model

Sandra Wallach

have lot of additional – don’t capacity. don’t we yes, we a Well,

We’re intensive. a capital not heavy in

let just we’ve been was about fourth running We’ve $XXX,XXX. look me running quarter with flat been that. relatively at, So

So quarter I is think XXXX. $XXX,XXX to $XXX,XXX a reasonable for

Mike Latimore

you – how versus on mentioned are mid long mid years term? talking long-term last, just Like your many we to goals. then Okay.And

Steven Humphreys

the in… terms Mid, year. hold if this we after into that no than term, year And later next long going year And and of think in next. can

Mike Latimore

Okay. Thanks lot. a All right.


[Operator Instructions] Maxim We’ll Nehal with to the next Group. go Chokshi

Nehal Chokshi

XXXX? you will be thoughts thanks. on a Yes, calendar what for have Do CapEx

Sandra Wallach

to with, of applications include XXXX in else our spoke how strength capacity besides of our piece calendar one we’re based on the the only in that looking software we at be run ERP nothing million transponder There��s Steve support and around for system. CapEx total. equipment may there’s that that probably we $X strategic really enterprise demand some should

Nehal Chokshi

the growth. about with XX% Okay, is will especially XVR you’re prior through great. I guidance And then looking read way the organic at what the on that that guidance add

correct? And on that. a that follow-up is first, have So I’ll

Sandra Wallach

the Yes. add had that $XX initially top would correct line, said on to million assessment. $XX XVR so We million that’s a

Nehal Chokshi


all that synergies the so different guys is what that? above the I the segments possibility you rate. growth, think, what product XX% you a And very healthy organic between to think But is do given deliver and different have, growth

Steven Humphreys

got are the there the going on hear we’ve various certainly opportunities, initiatives and you When possibilities.

the said, in project pretty particular, stay way start hit, we’ve opportunity its quarter it’s just we there As be just days those. where we to gets so there? it with Absolutely. whether guidance, falls But into out. to And the it really to would particular have to early a fraught, is it that’s laid

Nehal Chokshi

percent that what And synergies having of between Okay. then product you’re the the different right segments? engagements now are leveraging

Steven Humphreys

give to just Yes, a snapshot that. you on

I early As days. very very, it’s said,

other in or Here opportunity substantial the actually in since have we that that got come deals over selling. some But of weeks look, ran framework are close, now at an for and the one three to side and we’ve a capabilities. salesforce got we sell these on a yet dealers joint say, number our right haven’t I’ve come to that us just given

been actually, path, a least So it’s, or I can’t than give expected. you but at trajectory I it’s stronger

Nehal Chokshi

That’s helpful. right. you. Thank All


session. At question-and-answer this company’s concludes time, this the

you Investor remarks. to for Identiv’s the like to at team taken, may not was I’d now Relations question your Mr. his Humphreys If over closing contact turn back call

Steven Humphreys

everybody, thanks, All And us right. today. for joining Vicki. Thanks,

and very now following to stay course, we’ll very As where us. investor in to ISC we you there we’ll moment conferences company you ahead ROTH demos set at can throughout. West, conference can including right on going of hear, expect And week cross-sells execute of the and also, be and hard we’ve have a working on. then we at all time industry are of opportunity very events, excited Hopefully, the the by interesting next the got be and

you Thank journey evening. forward all again, looking the with So sharing a to of you. great have and


for Thank today. you us joining

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