Identiv Reports 2Q 2019 Results

Identiv, Inc. reported financial results for the second quarter ended June 30, 2019.
 
Revenue for the second quarter of 2019 was $22.2 million, an increase of 10% from $20.3 million in the second quarter of 2018 and an increase of 14% from $19.5 million in the first quarter of 2019.
 
Revenue in the Premises segment increased 21% from the second quarter of 2018 and increased 14% from the prior quarter to $10.7 million. Revenue in the Identity segment increased 1% from the second quarter of 2018 and increased 13% from the prior quarter to $11.6 million. 
 
The year-over-year growth in the Identity segment mainly reflects strong international growth in smart card reader and reader module sales which grew 11% year over year. In addition, the revenue increase reflects the contribution of all products including the Thursby Software Systems acquisition and international growth in access cards, partially offset by the as-anticipated lower access cards sales in the Americas region.
 
GAAP gross margin was 44% in the second quarter of 2019, an increase of 400 basis points compared to 40% in the second quarter of 2018 and a decrease from 45% in the first quarter of 2019. 

GAAP net income attributable to Identiv, Inc. totaled $0.4 million in the second quarter of 2019, compared to a net loss of $(2.7) million in the second quarter of 2018, and a net loss of $(0.8) million in the first quarter of 2019. GAAP net income attributable to common stockholders per share (EPS) was $0.01 in the second quarter of 2019, compared to a net loss of $(0.18) per share in the second quarter of 2018 and a net loss of $(0.06) per share in the first quarter of 2019. 
 
Non-GAAP adjusted EBITDA in the second quarter of 2019 totaled $2.4 million, an increase of approximately 241% compared to $0.7 million in the second quarter of 2018, and $1.2 million in the first quarter of 2019. The year-over-year increase reflects higher revenues as well as higher gross margins and lower operating expenses.
 
“The second quarter reflected the realization of many aspects of our strategy,” Identiv CEO Steven Humphreys said. “Our complete security solution suite is now in place, with our Velocity, Freedom, 3VR, Enterphone, Thursby, RFID, smart card reader, TS Reader, and TS Cards product lines representing the most comprehensive product line from a single vendor in our industry, as far as we are aware. The cross-selling opportunities, higher per-customer value, more strategic customer relationships, and ability to lead the security transformation being demanded by customers are reflected in these results: software and services growth of 47%, gross margin expansion, top-line growth, all with operating expenses down from a year ago and flat sequentially. This demonstrates the leverage in the business model and the long term strategic opportunity we have built.
 
“Security is more critical than ever, yet more complex and pervasive than ever. Customers need a single vendor as a long-term partner to serve their needs 100% reliably today while enabling a path to software-defined, frictionless infrastructure that leverages their existing IT and security investments,” added Humphreys. “We’re increasingly being seen as that partner due to our range of technologies, our strong customer-first culture, and our commitment to delivering solutions conventionally on-premises, in hybrid architectures, and through fully cloud, mobile, and web solutions.”
 
“During Q2, we grew revenues 10% and achieved positive GAAP net income attributable to common stockholders and positive EPS for the first time in several years,” Sandra Wallach, Identiv CFO, added. “We also achieved our 12th consecutive quarter of positive adjusted EBITDA. The continued year-over-year adjusted EBITDA and bottom line increase in the second quarter demonstrates that we are managing costs efficiently and that the integration and leveraging of the acquisitions is progressing very well. Overall, we continue to believe that we are in a position to reach our financial targets for the year.”