10q10k10q10k.net

What changed in Intellicheck, Inc.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of Intellicheck, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+178 added−161 removedSource: 10-K (2026-03-19) vs 10-K (2025-03-31)

Top changes in Intellicheck, Inc.'s 2025 10-K

178 paragraphs added · 161 removed · 123 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

51 edited+1 added−3 removed48 unchanged
Biggest changeThe automation resulting from the intelligence added to the form dramatically increases throughput and data integrity, and it significantly enhances the customer’s experience. Develop Additional Strategic Alliances with Solutions Providers .
Biggest changeThe automation resulting from the intelligence added to the form dramatically increases throughput and data integrity, and it significantly enhances the customer’s experience. Develop Additional Strategic Alliances . We have entered strategic alliances to utilize our systems and software as the proposed or potential enrollment application for their technologies and to jointly market these security applications.
Item 1. Business OVERVIEW We were originally incorporated in the state of New York in 1994 as Intelli-Check, Inc. In August 1999, we reincorporated in Delaware. On March 14, 2008, our corporation was renamed Intelli-Check - Mobilisa, Inc. after the consummation of the merger with Mobilisa, Inc.
Item 1. Business OVERVIEW We originally were incorporated in the state of New York in 1994 as Intelli-Check, Inc. In August 1999, we reincorporated in Delaware. On March 14, 2008, our corporation was renamed Intelli-Check - Mobilisa, Inc. after the consummation of the merger with Mobilisa, Inc.
For example, we have extended our technologies into online applications to provide identity validation and fraud prevention for the billions of transactions that occur online each day. We have also incorporated biometric, facial recognition and other enhancements to several of our current product offerings in order to stay on the leading edge of technology.
For example, we have extended our technologies into online applications to provide identity validation and fraud prevention for the billions of transactions that occur online each day. We also have incorporated biometric, facial recognition and other enhancements to several of our current product offerings in order to stay on the leading edge of technology.
These fakes appear so real, even law enforcement agencies have encountered difficulty distinguishing them from legally issued documents. Additionally, high-tech equipment can easily alter properly issued forms of ID.
These fakes appear so real, even law enforcement agencies have encountered difficulty distinguishing them from legally issued documents. Additionally, high-tech equipment easily can alter properly issued forms of ID.
OUR PRODUCTS AND SERVICES Our Products and Services are generally sold as Software-as-a-Service (“SaaS”) where customers pay for our cloud-based service. Identity Systems Products and Services Our Identity Systems are marketed to the Commercial, Retail, Financial and Government identification sectors.
OUR PRODUCTS AND SERVICES Our Products and Services generally are sold as Software-as-a-Service (“SaaS”) where customers pay for our cloud-based service. Identity Systems Products and Services Our Identity Systems are marketed to the Commercial, Retail, Financial and Government identification sectors.
Commercial Identification Intellicheck ® Identity Service The Intellicheck Service is a complete identity solution that checks whether an ID is valid, matches the ID to the person presenting it, and provides a risk score to help determine the risk of doing business with that person.
Commercial Identification Intellicheck ® Service The Intellicheck Service is a complete identity solution that checks whether an ID is valid, matches the ID to the person presenting it, and provides a risk score to help determine the risk of doing business with that person.
Our Intellicheck Service can quickly determine if: • the format of the document is valid; • the document has been altered or is fake, by displaying the parsed, encoded data for comparison with the printed information; • the document has expired; or • the encoded data contains a date of birth equal to or greater than the legal age to purchase age restricted products, such as alcohol, vaping products, cannabis and tobacco.
Our Intellicheck Service quickly can determine: • if the format of the document is valid; • if the document has been altered or is fake by displaying the parsed, encoded data for comparison with the printed information; • if the document has expired; or • if the encoded data contains a date of birth equal to or greater than the legal age to purchase age-restricted products, such as alcohol, vaping products, cannabis and tobacco.
These facial biometrics capabilities allow the Intellicheck platform to check for likeness to ensure that static photos are not being used as a stand-in for the user on both ends of the match, in addition to the ability to match the ID 5 Table of Contents photo to the selfie and provide a match score.
These facial biometrics capabilities allow the Intellicheck platform to check for likeness to ensure that static photos are not being used as a stand-in for the user on both ends of the match, in addition to the ability to match the 5 Table of Contents ID photo to the selfie and provide a match score.
How the Service is delivered The Intellicheck Service consists of the following elements: • IDN-Mobile • IDN-Mobile is an Intellicheck-branded identity validation application that can be typically set-up for a user in under an hour. It provides the ability to scan an ID using a mobile phone or tablet.
How Intellicheck Service is delivered The Intellicheck Service consists of the following elements: • IDN-Mobile • IDN-Mobile is an Intellicheck-branded identity validation application that typically can be set-up for a user in under an hour. It provides the ability to scan an ID using a mobile phone or tablet.
Additionally, Portal also adds global document validation, retail POS integration, additional data for analytics and analysis and online validation among other features. • IDN-Direct • IDN-Direct provides the capabilities of the Intellicheck service within user's own apps and integrated with their systems. IDN-Direct is accessible through the Intellicheck API to aid integration into customer applications and systems.
Additionally, Portal also adds global document validation, retail POS integration, additional data for analytics and analysis and online validation among other features. • IDN-Direct • IDN-Direct provides the capabilities of the Intellicheck Service within the user's own apps and integrated with their systems. IDN-Direct is accessible through the Intellicheck API to aid integration into customer applications and systems.
Instant Credit Application Kiosk Software Applications These are custom software applications that Intellicheck developed for a variety of major financial service companies and retail stores. The software installed on multiple kiosk devices provides the customers of the major financial service companies and retail stores with the ability to perform in-store instant credit approval on these devices.
Instant Credit Application Kiosk Software Applications These are custom software applications that Intellicheck developed for a variety of major financial service companies and retail stores. The software installed on multiple kiosk devices provides the customers of the major financial service companies and retail stores with the ability to perform in-store instant credit approval.
If approved, the applicant is granted instant credit which can then be used to make purchases. Upgrade Capability Our Intellicheck Service products and related databases are constantly updated to stay current with identification formats, new forms of ID and government regulations guiding use of digital information.
If approved, the applicant is granted instant credit which then can be used to make purchases. Upgrade Capability Our Intellicheck Service products and related databases are constantly updated to stay current with identification formats, new forms of ID and government regulations guiding use of digital information.
We are currently licensing our SDK software product for Windows, iOS, Android and other operating system platforms and intend to similarly continue to license our PC software solutions. Our software is intended to be used with a compatible hardware device. We have entered into multiple licensing agreements to date. 7 Table of Contents Protect Intellectual Property .
We currently are licensing our SDK software product for Windows, iOS, Android and other operating system platforms and intend to similarly continue to license our PC software solutions. Our software is intended to be used with a compatible hardware device. We have entered into multiple licensing agreements to date. 7 Table of Contents Protect Intellectual Property .
Additionally, we believe that we are currently in compliance with applicable United States federal laws, state and local laws and regulations relating to the protection of the environment. COMPETITION Commercial Identity Systems We compete in an industry that is intensely competitive and rapidly changing.
Additionally, we believe that we currently are in compliance with applicable United States federal laws, state and local laws and regulations relating to the protection of the environment. COMPETITION Commercial Identity Systems We compete in an industry that is intensely competitive and rapidly changing.
We rely on a small number of suppliers to provide our COTS products. 10 Table of Contents RESEARCH AND DEVELOPMENT Our research and development efforts are mainly concentrated in the area of identity verification. Research and development expenses consist primarily of employee salaries, benefits, bonuses, and stock-based compensation.
We rely on a small number of suppliers to provide our COTS products. 10 Table of Contents RESEARCH AND DEVELOPMENT Our research and development efforts mainly are concentrated in the area of identity verification. Research and development expenses consist primarily of employee salaries, benefits, bonuses, and stock-based compensation.
Target industries include alcohol, cannabis, tobacco, gambling, bars and nightclubs. ■ Unauthorized Access – our systems and software are designed to increase security and deter terrorism at airports, shipping ports, rail and bus terminals, military installations, high profile buildings and infrastructure where security is a concern; 3 Table of Contents ■ Fraudulent Retail Purchase Returns – implementing our validation software solutions can prevent fraudulent retail returns in situations where customers are seeking store credit or cash compensation for items being returned without a receipt when the transaction requires a driver license for identification; and ■ Inefficiencies Associated with Manual Data Entry – by reading encoded data contained in the bar code and magnetic stripe of an identification card with a quick swipe or scan of the card, where permitted by law, customers are capable of accurately and instantaneously inputting information into forms, applications and the like without the errors associated with manual data entry.
Target industries include alcohol, cannabis, tobacco, gambling, bars and nightclubs. ■ Unauthorized Access – our systems and software are designed to increase security and deter terrorism at airports, shipping ports, rail and bus terminals, military installations, high profile buildings and infrastructure where security is a concern; 3 Table of Contents ■ Fraudulent Retail Purchase Returns – implementing our validation software solutions can prevent fraudulent retail returns in situations where customers are seeking store credit or cash compensation for items being returned without a receipt when the transaction requires a driver's license for identification; and ■ Inefficiencies Associated with Manual Data Entry – by reading encoded data contained in the bar code and magnetic stripe of an identification card with a quick swipe or scan of the card, where permitted by law, customers are capable of accurately and instantaneously inputting information into forms, applications and the like without the errors associated with manual data entry.
Additionally, starting with only a fraudulent driver license, an individual may be able to create multiple credit accounts, commit fraud, buy age restricted products such as alcohol, tobacco and cannabis while underage, evade law enforcement and engage in other criminal activities, such as: • committing identity theft • gaining entrance to high profile buildings and sensitive infrastructures • improperly boarding airplanes • engaging in medical fraud • committing credit card, debit card and check cashing fraud • purchasing age restricted products such as alcohol, cannabis and tobacco while underage • illegally purchasing firearms • obtaining welfare or other government benefits. 4 Table of Contents • unlawfully committing pharmacy fraud including false narcotic prescriptions; and • committing refund fraud Given the ease with which identification can be falsified, simply looking at a driver license may not be sufficient to verify age or identity and determine if it is fraudulent.
Additionally, starting with only a fraudulent driver's license, an individual may be able to create multiple credit accounts, commit fraud, and buy age restricted products such as alcohol, tobacco and cannabis while underage, evade law enforcement and engage in other criminal activities, such as: • committing identity theft • gaining entrance to high-profile buildings and sensitive infrastructures • improperly boarding airplanes • engaging in medical fraud • committing credit card, debit card and check cashing fraud • purchasing age-restricted products such as alcohol, cannabis, or tobacco while underage • illegally purchasing firearms • obtaining welfare or other government benefits. 4 Table of Contents • unlawfully committing pharmacy fraud, including false narcotic prescriptions; and • committing refund fraud Given the ease with which identification can be falsified, simply looking at a driver's license may not be sufficient to verify age or identity and determine if it is fraudulent.
STRATEGY Our objective is to be a leading identity verification company providing world class solutions in the identity sector. These solutions include our commercial identity systems focusing on workflow, productivity enhancement, fraud protection and risk management segments. Key elements of our strategy are as follows: Commercial Systems Productivity Enhancement. We market our technology as a key productivity enhancement tool.
STRATEGY Our objective is to be a leading identity verification company providing world-class solutions in the identity sector. These solutions include our commercial identity systems focusing on workflow, productivity enhancement, fraud protection and risk management segments. Key elements of our strategy are as follows: Commercial Systems Enhance Productivity. We market our technology as a key productivity enhancement tool.
Validating the ID Using its own proprietary technology, Intellicheck utilizes an iOS or Android phone, or a retail scanner to read and verify the encoded format contained on U.S. and Canadian driver licenses, state issued non-driver identification cards, military IDs and passports.
Validating the ID Using its own proprietary technology, Intellicheck utilizes an iOS or Android phone, or a retail scanner to read and verify the encoded format contained on U.S. and Canadian driver's licenses, state issued non-driver identification cards, military IDs and passports.
Our Target Industry Sectors Commercial Identity Systems The use of false identification cards, primarily driver licenses and non-driver identification cards, to engage in commercial fraud, to gain access to unauthorized areas and to gain entry to critical infrastructure is all too common and the problem is growing with each passing day.
Our Target Industry Sectors Commercial Identity Systems The use of false identification cards, primarily driver's licenses and non-driver identification cards, to engage in commercial fraud, to gain access to unauthorized areas and to gain entry to critical infrastructure is all too common and the problem is growing with each passing day.
Our technologies address problems such as: ■ Commercial Fraud – financial institutions and merchants use our technology to prevent economic losses from check cashing, debit and credit card transactions, account take overs, e-commerce as well as other types of fraud such as identity theft that principally use fraudulent identification documents as proof of identity; ■ Instant Credit Card Approval – retail stores and financial institutions use our technology to scan a driver license at a kiosk or at the Point of Sale (POS) to confirm that an applicant is who they claim to be with additional certainty.
Our technologies address problems such as: ■ Commercial Fraud – financial institutions and merchants use our technology to prevent economic losses from check cashing, debit and credit card transactions, account take overs, and e-commerce as well as other types of fraud such as identity theft that principally use fraudulent identification documents as proof of identity; ■ Instant Credit Card Approval – retail stores and financial institutions use our technology to scan a driver's license at a kiosk or at the Point of Sale (POS) to confirm that an applicant is who they claim to be with additional certainty.
Since merchants and financial institutions are facing significant economic losses due to these frauds, we believe that a document authentication system which can accurately read the digitally stored information is needed.
Since merchants and financial institutions are facing significant economic losses due to these frauds, we believe that a document authentication system that can accurately read the digitally stored information is needed.
We generate revenues from the licensing of our software and to a much lesser extent the selling of bundled solutions that contain hardware and software. Depending on the specific needs of our clients, we tailor the appropriate solution for them.
We generate revenues from the licensing of our software, and to a much lesser extent, the selling of bundled solutions that contain hardware and software. Depending on the specific needs of our clients, we tailor the solution for them.
We believe that units unable to read bar codes are at a significant disadvantage because all states and Canadian provinces currently utilize bar codes to encode their driver licenses, as well as all U.S. military IDs and uniformed services cards. We have experienced and expect to continue to experience increased competition in the document verification sector.
We believe that units unable to read bar codes are at a significant disadvantage because all states and Canadian provinces currently utilize bar codes to encode their driver's licenses, as well as all U.S. military IDs and uniformed services cards. We have experienced and expect to continue to experience increased competition in the document verification sector.
It is designed to be used in online and retail settings using devices that can include a mobile phone or tablet, a PC or retail scanner. The Intellicheck Service is designed to address the needs of users across a variety of use cases including account access, account openings, receipt-less returns, receipt of delivery, age restricted purchases and more.
It is designed to be used online and in retail settings using devices that can include a mobile phone or tablet, a PC or retail scanner. The Intellicheck Service is designed to address the needs of users across a variety of use cases including account access, account openings, receiptless returns, receipt of delivery, age restricted purchases and more.
On May 4, 2017, with the approval of our shareholders, we changed our name to Intellicheck, Inc. (“Intellicheck,” “we,” “our,” “us,” or “the Company”). On August 31, 2009, the Company acquired 100% of the common stock of Positive Access Corporation (“Positive Access”), a developer of driver license reading technology.
On May 4, 2017, with the approval of our shareholders, we changed our name to Intellicheck, Inc. (“Intellicheck,” “we,” “our,” “us,” or “the Company”). On August 31, 2009, the Company acquired 100% of the common stock of Positive Access Corporation (“Positive Access”), a developer of driver's license reading technology.
This technique protects consumer data and is significantly more likely to result in a completed transaction compared to in-store personnel asking customers to fill out a paper form and then entering the data; ■ Age Restricted Product Access – products validate driver licenses and other government forms of identification to confirm the age of customers purchasing age restricted products.
This technique protects consumer data and is significantly more likely to result in a completed transaction compared to in-store personnel asking customers to fill out a paper form and then entering the data; ■ Age Restricted Product Access – products validate driver's licenses and other government forms of identification to confirm the age of customers purchasing age restricted products.
Unless a device can read, decode and analyze all the information that is legally permitted to be analyzed, which is digitally stored within the barcode on a driver license, the user may not obtain accurate and reliable confirmation that a driver license is valid and has not been altered or tampered with.
Unless a device can read, decode and analyze all the information that is legally permitted to be analyzed, which is digitally stored within the barcode on a driver's license, the user may not obtain accurate and reliable confirmation that a driver's license is valid and has not been altered or tampered with.
In 2012, we were granted a patent relating to a system and method for comparing information contained in at least two documents, but not limited to just a driver license and passport. This patent compares “like information” on different documents to determine whether the information is the same on each document.
In 2012, we were granted a patent relating to a system and method for comparing information contained in at least two documents, but not limited to just a driver's license and passport. This patent compares “like information” on different documents to determine whether the information is the same on each document.
IDENTITY CARD READING AND VERIFICATION SECTOR Background on Identification Documentation Driver license The driver license is the most widely used form of government issued photo identification in North America. The Real ID Act, which became federal law in May 2005, recognizes that the driver license is also a quasi-identification card.
IDENTITY CARD READING AND VERIFICATION SECTOR Background on Identification Documentation Driver's license The driver's license is the most widely used form of government issued photo identification in North America. The Real ID Act, which became federal law in May 2005, recognizes that the driver's license is also a quasi-identification card.
The applicant then completes the application by entering the remaining required information that is not encoded on the driver license, such as social security number and telephone numbers. The software application then sends the data to the financial service company’s backend “decisioning” tool for credit approval.
The applicant then completes the application by entering the remaining required information that is not encoded on the driver's license, such as social security number and telephone numbers. The software application then sends the data to the financial service company’s backend “decisioning” tool for credit approval.
Our technology can read the digitally stored barcode information on all currently issued driver licenses even those that do not comply with the standards of the American Association of Motor Vehicle Administrators (“AAMVA”), the American National Standards Institute (“ANSI”) and the International Standards Organization (“ISO”).
Our technology can read the digitally stored barcode information on all currently issued driver's licenses even those that do not comply with the standards of the American Association of Motor Vehicle Administrators (“AAMVA”), the American National Standards Institute (“ANSI”) and the International Standards Organization (“ISO”).
We are aware of several companies that are currently offering products that electronically read and calculate age from a driver license. We have tested and compared some of these products to the Intellicheck Service and believe that our product is superior in quality and functionality.
We are aware of several companies that currently are offering products that electronically read and calculate age from a driver's license. We have tested and compared some of these products to the Intellicheck Service and believe that our product is superior in quality and functionality.
We possess patented technology that provides an analysis of the data contained on the encoded formats of these identification documents by reading and analyzing the encoded format on the bar code on the driver license and comparing it against known standards.
We possess patented technology that provides an analysis of the data contained on the encoded formats of these identification documents by reading and analyzing the encoded format on the bar code on the driver's license and comparing it against known standards.
REGULATION The sale and use of our Identity Service products are subject to regulation, such as on data protection and storage, by government authorities. We work on an ongoing basis with our customers to facilitate their compliance with such regulations.
REGULATION The sale and use of our products are subject to regulation, such as on data protection and storage, by government authorities. We work on an ongoing basis with our customers to facilitate their compliance with such regulations.
Our technology has the ability to verify the encoded formats on all currently encoded documents, even those that do not comply with the standards of the AAMVA, ANSI and ISO. Using integrated third-party technology, Intellicheck offers the ability, through certain platforms, to scan and verify over 10,000 documents around the world including drivers licenses, state identity documents and passports.
Our technology has the ability to verify the encoded formats on all currently encoded documents, even those that do not comply with the standards of the AAMVA, ANSI and ISO. Using integrated third-party technology, Intellicheck offers the ability, through certain platforms, to scan and verify more than 10,000 documents around the world including drivers licenses, state identity documents and passports.
Given the ease with which identification can be falsified, we believe that simply looking at a driver license is not sufficient to verify identity and determine if such an identification card is fraudulent.
Given the ease with which identification can be falsified, we believe that simply looking at a driver's license is not sufficient to verify identity and determine if such an identification card is fraudulent.
We are a prominent technology company that delivers on-demand digital identity validation solutions for KYC, fraud, and age verification needs. We validate both digital and physical identities for financial services, fintech companies, BNPL providers, e-commerce, and retail commerce businesses, law enforcement and government agencies across North America.
We are a prominent technology company that delivers on-demand digital identity validation solutions for Know Your Customer ("KYC") fraud, and age verification needs. We validate both digital and physical identities for financial services, fintech companies, BNPL providers, e-commerce, retail commerce businesses, law enforcement and government agencies across North America.
The hardware platforms, on which the software applications run, range from stationary devices to handhelds to tablet PCs. The process involves the swiping or scanning of the driver license to verify the encoded format and after verification, the information parsed from the encoded data is populated into the proper fields on the application displayed on the kiosk.
The hardware platforms, on which the software applications run, range from stationary devices to handhelds to tablet PCs. The process involves the swiping or scanning of the driver's license to verify the encoded format and after verification, the information parsed from the encoded data is populated into the proper fields on the application displayed at the kiosk.
These identification cards are issued with most of the same data found on a driver license. Military documents and passports also provide a means of identification and contain encoded data as well.
These identification cards are issued with most of the same data found on a driver's license. Military documents and passports also provide a means of identification and contain encoded data as well.
Once confirmed that the driver license is valid, the transaction can proceed to the underwriting stage where qualified applicants can get instant approval for a loyalty-branded credit card.
Once confirmed that a driver's license is valid, the transaction can proceed to the underwriting stage where qualified applicants can get instant approval for a loyalty-branded credit card.
Research and development expenses also include consulting fees, software and subscription services, and a portion of our third-party cloud infrastructure expenses incurred in maintaining our platform. INTELLECTUAL PROPERTY We currently hold thirteen (13) U.S. patents and one (1) Canadian patent. These patents cover commercially important aspects of our capabilities relating to the authentication and verification of identification documents.
Research and development expenses also include consulting fees, software and subscription services, and a portion of our third-party cloud infrastructure expenses incurred in maintaining our platform. INTELLECTUAL PROPERTY We currently hold ten (10) U.S. patents and one (1) Canadian patent. These patents cover commercially important aspects of our capabilities relating to the authentication and verification of identification documents.
Matching the person to the ID Intellicheck integrates third party software to provide the ability to match a selfie of a person to the picture on the driver license.
Matching the person to the ID Intellicheck integrates third-party software to provide the ability to match a selfie of a person to the picture on the driver's license.
Since driver licenses are the most widely used form of legally acceptable government documentation, we refer to all these identification documents as “driver licenses.” Our software can perform its function on all these forms of identification.
Since driver's licenses are the most widely used form of legally acceptable government documentation, we refer to all these identification documents as “driver's licenses.” Our software can perform its function on all these forms of identification.
We have twenty-two employees in information technology including those participating in our research and development efforts, nine employees in sales and marketing, seven employees in customer and support integration, and nine employees in administration.
We have twenty employees in information technology including those participating in our research and development efforts, four employees in sales and marketing, seven employees in customer and support integration, and seven employees in administration.
IDN-Direct also provides an SDK to simplify integration into the user’s mobile applications. IDN-Direct provides access to additional data and also provides the ability to use the platform’s Risk Score capability to help with decision-making. • IDN-Capture • IDN-Capture provides the capabilities of the Intellicheck service within a flexible custom white label experience.
IDN-Direct provides a Software Development Kit ("SDK") to simplify integration into the user’s mobile applications. IDN-Direct also provides access to additional data along with the ability to use the platform’s Risk Score capability to help with decision making. • IDN-Capture • IDN-Capture provides the capabilities of the Intellicheck Service within a flexible custom white label experience.
MAJOR CUSTOMERS Although the composition of our largest customers has changed from year to year, a significant portion of our revenues have been attributable to a limited number of major customers. In 2024 and 2023, our top ten customers accounted for approximately 71% of total revenues.
MAJOR CUSTOMERS Although the composition of our largest customers has changed from year to year, a significant portion of our revenues has been attributable to a limited number of major customers. In 2025 and 2024, our top ten customers accounted for approximately 77% and 71%, respectively, of total revenues.
IDN-Mobile provides the flexibility to allow the Intellicheck customer or their customer to perform the scan and enables the Intellicheck customer to manage their application online using the PC. • IDN-Portal • IDN-Portal has all the features of IDN-Mobile and additionally includes the ability to perform a facial biometrics test to match the picture on the ID to a selfie of the user presenting the ID.
This enables the Intellicheck customer to manage their application online using the PC. • IDN-Portal • IDN-Portal has all the features of IDN-Mobile and additionally includes the ability to perform a facial biometrics test to match the picture on the ID to a selfie of the user presenting the ID.
Today, all 50 states, the District of Columbia, territories of the United States, United States Military, and all 13 Canadian provinces/territories digitally store information on their driver license. Non-driver identification card Each U.S. and Canadian jurisdiction also provides a non-driver identification card as an alternative form of identification for those unable to acquire a driver license.
Today, all 50 states, the District of Columbia, territories of the United States, United States Military, and all 13 Canadian provinces/territories digitally store information on their driver license. Non-driver identification card U.S. and Canadian jurisdictions also provide a non-driver identification cards as an alternative form of identification for those unable to acquire a driver's license.
We also have several trademarks relating to our company, its product names, and logos. 11 Table of Contents EMPLOYEES AND HUMAN CAPITAL RESOURCES As of March 31, 2025, we had 47 full-time employees. Three are engaged in executive management — our Chief Executive Officer, Chief Financial Officer and Chief Technology Officer.
We also have several trademarks relating to our company, its product names, and logos. 11 Table of Contents EMPLOYEES AND HUMAN CAPITAL RESOURCES As of March 19, 2026, we had 38 full-time employees. Four are engaged in executive management — our Chief Executive Officer, Chief Financial Officer, Chief Technology Officer, and Chief Commercial Officer.
Facial biometrics may add additional seconds to the process. • Fast deployment • With IDN-Mobile or IDN-Portal, customers can typically be up and running in under an hour. • Accurate ID validation • For North American documents, Intellicheck provides market-leading identity validation accuracy.
Facial biometrics may add additional seconds to the process. • Fast deployment • With IDN-Mobile or IDN-Portal, customers typically can be up and running in under an hour. • Accurate ID validation • For North American documents, Intellicheck provides market-leading identity validation accuracy that can remove the need for manual review, as well as accuracy that leading businesses use to enable real-time processes.
Removed
Accuracy that can remove the need for manual review, and accuracy that leading businesses use to enable real time processes.
Added
IDN-Mobile provides the flexibility to allow the Intellicheck customer or their customer to perform the scan.
Removed
We have entered strategic alliances to utilize our systems and software as the proposed or potential enrollment application for their technologies and to jointly market these security applications with multiple solution providers. Some of these companies have included Accio Data, Doma Title Insurance, and Dealer SafeGuard Solutions.
Removed
In response to the COVID-19 pandemic, we implemented and have continued significant changes that we determined were in the best interest of our employees, as well as the community in which we operate, and which comply with government regulations, including working in a remote environment where appropriate or required.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

25 edited+35 added−22 removed43 unchanged
Biggest changeThese budgetary pressures may reduce the ability of certain governmental agencies to perform their responsibilities, which could have a material adverse effect on our business. Our business strategy exposes us to long sales and implementation cycles for our products.
Biggest changeChanges in federal spending priorities, prolonged government shutdowns, constraints on agency budgets and staffing levels, or shifts in policy priorities could reduce the ability of certain governmental agencies to perform their responsibilities, including issuing and updating identification standards and sharing reference data with us, which could have a material adverse effect on our business.
In addition, the stock market experiences extreme fluctuations in price and volume, that particularly affect the market price of shares of technology companies, such as ours. These price and volume fluctuations are often unrelated or disproportionate to the operating performance of the affected companies.
In addition, the stock market experiences extreme fluctuations in price and volume that particularly affect the market price of shares of technology companies, such as ours. These price and volume fluctuations often are unrelated or disproportionate to the operating performance of the affected companies.
Failure to manage our operations if they expand could impair our future growth. If we can expand our operations, particularly through multiple sales to large retailers and government agencies in the document verification industry, the expansion will place significant strain on our management, financial controls, operating systems, personnel and other resources.
Failure to manage our operations if they expand could impair our future growth. If we expand our operations, particularly through multiple sales to large retailers and government agencies in the document verification industry, the expansion will place significant strain on our management, financial controls, operating systems, personnel and other resources.
If our future products incorporate technologies that infringe the proprietary rights of third parties, and we do not secure licenses from them, we could be liable for substantial damages. We are not aware that our current products infringe the intellectual property rights of any third parties.
If our future products incorporate technologies that infringe the proprietary rights of third parties, and we do not secure licenses from them, we could be liable for substantial damages. We are not aware of our current products infringing the intellectual property rights of any third parties.
Because our continued success depends on, to a significant degree, our ability to offer products providing superior functionality and performance over those offered by our competitors, we consider the protection of our technology from unauthorized use to be fundamental to our success.
Because our continued success depends on, to a significant degree, our ability to offer products providing superior functionality and performance to those offered by our competitors, we consider the protection of our technology from unauthorized use to be fundamental to our success.
As an example, the California Privacy Rights Ace (the “CCPA”) requires covered businesses that process the personal information of California residents to, among other things: provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information; receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information; and enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf.
As an example, the California Privacy Rights Act (the “CCPA”) requires covered businesses that process the personal information of California residents to, among other things: provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information; receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information; and enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf.
The commercial sector can develop faster than the government sector, but it is also subject to a higher level of uncertainty because of potential uncertainty in the continued financial health of our commercial customers, as well as long sales cycles. Our business may suffer if the industry develops more slowly than anticipated and does not sustain industry acceptance.
The commercial sector can develop faster than the government sector, but it subject to a higher level of uncertainty because of potential uncertainty in the continued financial health of our commercial customers, as well as long sales cycles. Our business may suffer if the industry demand develops more slowly than anticipated and does not sustain industry acceptance.
The company must implement robust security measures to protect this data from breaches, as any leak could lead to severe reputational damage, legal consequences, and loss of customer 16 Table of Contents trust. Additionally, evolving privacy laws and regulations specifically targeting biometric data could impose new compliance burdens on the company.
The company must implement robust security measures to protect this data from breaches, as any leak could lead to severe reputational damage, legal consequences, and loss of customer trust. Additionally, evolving privacy laws and regulations specifically targeting biometric data could impose new compliance burdens on the company.
If we can grow our business but do not manage our growth successfully, we may experience increased operating expenses, loss of customers, distributors, or suppliers and declining or slowed growth of revenues. 13 Table of Contents Failure to protect our proprietary technology may impair our competitive position.
If we can grow our business but do not manage our growth successfully, we may experience increased operating expenses, loss of customers, distributors or suppliers and declining or slowed growth of revenues. Failure to protect our proprietary technology may impair our competitive position.
As such, those funds in bank deposit accounts in excess of the standard FDIC insurance limits are uninsured and subject to the risk of bank failure. 18 Table of Contents Currently, we have full access to all funds in deposit accounts or other money management arrangements.
As such, those funds in bank deposit accounts in excess of the standard FDIC insurance limits are uninsured and subject to the risk of bank failure. Currently, we have full access to all funds in deposit accounts or other money management arrangements.
Declines in our stock price for any reason, fluctuations related to our financial results or due to macroeconomic conditions, including inflation and rising interest rates, capital market volatility and global conflicts, including the Russia-Ukraine war, the Israel-Hamas war and the conflict between China and Taiwan, may adversely affect your ability to sell your shares at a price equal to or above the price at which you purchased them.
Declines in our stock price for any reason, fluctuations related to our financial results or due to macroeconomic conditions, including inflation and rising interest rates, capital market volatility and global conflicts, including the Russia-Ukraine war, the recent military action against Iran, the Israel-Hamas war and the conflict between China and Taiwan, may adversely affect your ability to sell your shares at a price equal to or above the price at which you purchased them.
This is done by processes aimed at identifying and seeking appropriate protection for newly developed intellectual property, including patents, trade secrets, copyrights, and trademarks, as well as policies aimed at identifying unauthorized use of such property.
This is done by processes aimed at identifying and 13 Table of Contents seeking appropriate protection for newly developed intellectual property, including patents, trade secrets, copyrights, and trademarks, as well as policies aimed at identifying unauthorized use of such property.
We regularly maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks, in amounts which exceed the FDIC insurance limits.
We regularly maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks, in amounts that exceed the FDIC insurance limits.
The sectors for all our products are characterized by rapid technological advancements. Significant technological change could render existing technology obsolete. If we are unable to successfully respond to these developments, or do not respond in a cost-effective manner, our business, financial condition, and results of operations will be materially adversely affected. Our percentage of revenues and customer concentration is significant.
The sectors for all our products are characterized by rapid technological advancements. Significant technological change could render existing technology obsolete. If we are unable to successfully respond to these developments, or do not respond in a cost-effective manner, our business, financial condition, and results of operations will be materially adversely affected.
Additionally, we may not be able to achieve the growth necessary for our continued success. Failure to attract and retain management and other personnel may damage our operations and financial results and cause our stock price to decline.
Additionally, we may not be able to achieve the growth necessary for our continued success. 14 Table of Contents Failure to attract and retain management and other personnel may damage our operations and financial results and cause our stock price to decline.
The longer sales and implementation cycles for larger retail companies continue to have an adverse impact on the timing of realizing our revenues. In addition, budgetary constraints and potential economic slowdowns or inflationary pressures may also continue to delay purchasing decisions by these prospective customers.
The longer sales and implementation cycles for larger retail companies continue to have an adverse impact on the timing of realizing our revenues. In addition, budgetary constraints and potential economic slowdowns or inflationary pressures also may continue to delay purchasing decisions by these prospective customers. The industry for our systems and software is evolving and its growth is uncertain.
Demand and industry acceptance for recently introduced and existing systems, and software and sales from such systems, are subject to a high level of uncertainty and risk. With changing administration in government, changes in government budgets, and slowly evolving government standards on use of identity products, the government sector is slowly developing.
Demand and industry acceptance for recently introduced and existing systems, and software and sales from such systems, are subject to a high level of uncertainty and risk. Changes in government budgets, and slowly evolving government standards on use of identity products have impacted the development of our business serving the government sector.
The market price of our common stock, like the price of shares of technology companies generally, has been and may continue to be volatile.
Risks Related to Our Common Stock and the Market for Our Common Stock Our share price may be volatile and could decline substantially. The market price of our common stock, like the price of shares of technology companies generally, has been and may continue to be volatile.
If any third party prevails in an action against us for infringement of its proprietary rights, we could be required to pay damages and either enter costly licensing arrangements or redesign our products so as to exclude any infringing use. 14 Table of Contents As a result, we would incur substantial costs, delays in product development, sales and shipments, and our revenues may decline substantially.
If any third party prevails in an action against us for infringement of its proprietary rights, we could be required to pay damages and either enter costly licensing arrangements or redesign our products so as to exclude any infringing use.
From January 1, 2002 to March 31, 2025, the intra-day trading price of our common stock has 17 Table of Contents varied from a high of $145.52 to a low of $0.75 per share, as reported on The Nasdaq Stock Market.
From January 1, 2024 to March 19, 2026, the intra-day trading price of our common stock has varied from a high of $7.48 to a low of $1.65 per share, as reported on The Nasdaq Stock Market.
If we raise additional capital through the sale of equity, including preferred stock, or convertible debt securities, the percentage ownership of our then existing stockholders will be diluted. Because we do not intend to pay dividends on our Common Stock, stockholders will benefit from an investment in our stock only if it appreciates in value.
Even if we are successful in raising additional capital, if we do so through the sale of equity, including preferred stock, or convertible debt securities, the percentage ownership of our then existing stockholders will be diluted.
Since we expect to incur additional expenditures in line with the sales growth of our business, we may not achieve operating profits in the near future, and we could experience further losses. This could lead to a decline in the value of our securities. Our proprietary software relies on reference data provided by government and quasi-government agencies.
Accordingly, we may not be able to maintain profitability in subsequent periods, which could result in a decline in the value of our securities . Our proprietary software relies on reference data provided by government and quasi-government agencies.
Item 1A. Risk Factors RISK FACTORS Risks Related to Our Business and Industry (All dollar amounts are rounded to thousands, except per share data) We have incurred losses since inception and losses may continue, which could result in a decline in the value of our securities and a loss of your investment.
Item 1A. Risk Factors RISK FACTORS Risks Related to Our Business and Industry (All dollar amounts are rounded to thousands, except per share data) Although we achieved profitability for the fiscal year ended December 31, 2025, we have a history of operating losses, and we cannot provide assurance that we will maintain profitability.
Decreases in the price of our common stock may also lead to de-listing of our common stock. Future capital requirements may require incurring debt or dilution of existing stockholders. Acquisition and development opportunities and other contingencies may arise, which could require us to raise additional capital or incur debt.
Decreases in the price of our common stock also may lead to de-listing of our common stock.
The loss of one or more significant customers could have a significant adverse impact on our business, financial condition, and results of operations. We are subject to risks related to data privacy and the storage of biometric information.
Furthermore, these customers often have significant leverage in contract negotiations, which may result in pricing pressure or reduced margins. Our ability to replace these customers or comparable revenue streams is uncertain and could take significant time and investment. We are subject to risks related to data privacy and the storage of biometric information.
Removed
We incurred net losses of $(918) and $(1,980) for the fiscal years ended December 31, 2024 and 2023, respectively. Our accumulated deficit was $(134,483) as of December 31, 2024.
Added
We reported net income of $1,273 for the fiscal year ended December 31, 2025, compared to a net loss of $(918) for the fiscal year ended December 31, 2024. Despite this recent profitability, we have an accumulated deficit of $(133,210) as of December 31, 2025.
Removed
The current President Trump administration (the “Trump Administration”) recently established the Department of Government Efficiency, which implemented a federal government hiring freeze and announced certain additional efforts to reduce federal government employee headcount and the size of the federal government.
Added
We expect to continue incurring significant operating expenses as we invest in product development, specifically regarding our AI and fraud detection capabilities, and expand our sales operations. These investments may increase our costs faster than our revenue grows.
Removed
It is unclear how these executive actions or other potential actions by the Trump Administration or other parts of the federal government will impact the regulatory authorities that oversee our business and the governmental and quasi-governmental agencies that we interact with.
Added
Our business strategy exposes us to long sales and implementation cycles for our products.
Removed
These initiatives have costs associated with them, and we cannot assure you that they ultimately will prove successful, or result in, an increase to our revenues or profitability. The industry for our systems and software is evolving and its growth is uncertain.
Added
As a result, we would incur substantial costs, delays in product development, sales and shipments, and our revenues may decline substantially.
Removed
Further, these outcomes could damage investor confidence in the accuracy and reliability of our financial statements. Long lead times for the components used in certain products creates uncertainty in our supply chain and may prevent us from making required deliveries to our customers on time. We rely exclusively on COTS technology in manufacturing our products.
Added
Further, these outcomes could damage investor confidence in the accuracy and reliability of our financial statements. We rely on third-party mobile operating systems and hardware ecosystems that are outside our control. A significant portion of our revenue depends on our software running effectively on third-party mobile devices (iOS and Android) and Point-of-Sale ("POS") hardware. We do not control these platforms.
Removed
The lead-time for ordering certain components used in our products and the production of products can be lengthy. As a result, we must, from time to time, order products based on forecasted demand. If demand for products lags significantly behind forecasts, we may purchase more product than we can sell.
Added
If Apple, Google, or POS manufacturers alter their operating systems—for example, by restricting access to camera feeds or NFC (Near Field Communication) chips—our products could become non-functional. Furthermore, these platform providers may introduce competing native identity verification features (e.g., mobile IDs embedded directly in digital wallets) that could disintermediate third-party applications like ours.
Removed
Conversely, if demand exceeds forecasts, we may not have enough products to meet our obligations to our customers. We obtain certain hardware and services, as well as some software applications, from a limited group of suppliers, and our reliance on these suppliers involves significant risks, including reduced control over quality and delivery schedules.
Added
We rely on third-party service providers and cloud infrastructure to host our platform and process data; a cybersecurity breach, supply chain attack, or service disruption at these third parties could expose us to significant liability and disrupt our business.
Removed
Any financial instability of our suppliers could result in having to find new suppliers. We may experience significant delays in manufacturing and deliveries of products and services to customers if we lose our sources or if supplies and services delivered from these sources are delayed.
Added
Our SaaS delivery model and internal operations depend heavily on third-party service providers, including cloud infrastructure services, data center operators, and software vendors. We also utilize third-party technology for some critical functions such as facial biometric matching and global document validation.
Removed
As a result, we may be required to incur additional development, manufacturing, and other costs to establish alternative supply sources. It may take several months to locate alternative suppliers, if required. We cannot predict whether we will be able to obtain replacement hardware within the required time frames at affordable costs, or at all.
Added
While we implement security measures for our own systems, we do not have direct control over the cybersecurity protocols of these third-party providers. Sophisticated cyber attackers increasingly target these "supply chain" vendors to gain access to downstream customers like us.
Removed
Any delays resulting from suppliers failing to deliver hardware or delays in obtaining alternative hardware, in sufficient quantities and of sufficient quality, or any significant increase in the cost of hardware from existing or alternative suppliers could result in delays on the shipment of product which, in turn, could result in the loss of customers we may not be able to successfully complete. 15 Table of Contents Security breaches and other disruptions could potentially compromise our information and expose us to liability, which would be harmful to our business.
Added
If a third-party provider is compromised, attackers could infiltrate our systems, access sensitive personal information (PII) of our customers or their end-users or inject malicious code into our software updates. Furthermore, any service outage, ransomware attack, or denial-of-service attack targeting our cloud providers could render our platform unavailable to customers, leading to immediate revenue loss and reputational damage.
Removed
In the ordinary course of our business, we collect and store sensitive data, including intellectual property, our proprietary business information and that of our customers, and personally identifiable information of our customers, their customers and our employees, in our data centers and on our networks.
Added
Under current laws and regulations, we may be held liable for the unauthorized disclosure of sensitive data even if the breach 15 Table of Contents originates with a third-party vendor. Such an event could result in substantial fines, legal claims, termination of customer contracts, and a loss of confidence in our ability to protect sensitive identity data.
Removed
The secure processing, maintenance, and transmission, when applicable, of this information is critical to our operations and business strategy. Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance, or other disruptions.
Added
Under our current governance structure, our Board of Directors oversees cybersecurity risk management as a principal business risk. However, there is no guarantee that our oversight processes or the cybersecurity protocols of our third-party vendors will be sufficient to prevent a material breach.
Removed
Any such breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost, or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings, potential liability under laws that protect the privacy of personal information, and regulatory penalties.
Added
Any such incident would require us to disclose the event under Item 1.05 of Form 8-K, which could lead to immediate negative market reaction and long-term reputational harm. We are subject to risks associated with product failure and technological flaws.
Removed
This in turn could disrupt our operations and the services we provide to customers, damage our reputation, and potentially cause a loss of confidence in our products and service offerings, which could adversely affect our business and competitive position. We are subject to risks associated with product failure and technological flaws.
Added
A significant portion of our revenues is concentrated among a limited number of customers, and the loss or reduced usage of our products by one or more of these customers could materially adversely affect our results of operations.
Removed
We have a concentration of revenues with our ten largest customers which accounted for 71% of total revenues in 2024 and 2023. Three customers accounted for 50% of revenues in 2024 and three customers accounted for 47% of revenues in 2023.
Added
For the fiscal years ended December 31, 2025 and 2024, our top ten customers accounted for approximately 77% and 71% of our total revenues, respectively. The loss of any one of these significant customers, or a reduction in their spending levels, could have a material adverse effect on our business, financial condition, and results of operations.
Removed
The expansion of the use of artificial intelligence ("AI") within our business will pose ethical and bias mitigation challenges. As Intellicheck incorporates AI in its identity verification processes, the company faces risks related to AI ethics and potential biases in its algorithms. There's a growing concern about AI systems perpetuating or amplifying existing biases, particularly in identity verification contexts.
Added
Additionally, regulators are increasingly scrutinizing AI models for "algorithmic bias." If our fraud detection algorithms are found to perform differentially across demographic groups, we could face 16 Table of Contents regulatory fines, reputational harm, and requirements to alter our technology under laws like federal non-discrimination statutes.
Removed
Intellicheck must ensure its AI models are fair, transparent, and free from discriminatory outcomes across diverse demographic groups. Failure to address these ethical concerns could result in regulatory scrutiny, legal challenges, and damage to the company's reputation, potentially leading to loss of business and market share.
Added
Rapid advancements in generative artificial intelligence ("AI") and "deepfake" technology could render our identity verification solutions less effective. The identity verification industry is characterized by a "technological arms race." Bad actors increasingly are utilizing generative AI to create highly realistic synthetic identities and "deepfakes" capable of spoofing facial recognition systems.
Removed
Additionally, the models used in those processes may produce output or take action that is incorrect, expose private or confidential information, infringe on the intellectual property rights of others, or be otherwise harmful. Any of these risks could expose Intellicheck to liability or adverse legal or regulatory consequences.
Added
If our technology fails to detect these sophisticated AI-driven falsifications, or if we are unable to develop countermeasures faster than fraudsters develop evasion techniques (such as camera injection attacks), our customers may lose confidence in our platform.
Removed
Public health crises, such as COVID-19 or other similar pandemics in the future, can adversely impact our business. Public health crises, such as the COVID-19 pandemic, could lead to government shutdowns, stay-at-home orders, travel restrictions, business closures, cancellations of public gatherings, and other measures, which may have material adverse effects on our business.
Added
Furthermore, the shift toward 'digital-only' onboarding has increased our exposure to Synthetic Identity Fraud, where bad actors combine real and fabricated data to create entirely new, credible personas that do not have a history of prior fraud, making them significantly harder for traditional algorithms to detect.
Removed
The level and nature of the disruption caused by a public health crisis is unpredictable, may be cyclical and long-lasting and vary from location to location.
Added
This could result in increased liability, customer churn, and material adverse effects on our business. Our significant deferred tax assets are subject to a full valuation allowance, and changes in our assessment could materially affect our reported results. As of December 31, 2025, we had gross deferred tax assets of approximately $7,145, which were fully offset by a valuation allowance.
Removed
While many of the original restrictions levied by governments in response to COVID-19 have been removed, additional variants, or similar pandemics in the future, could cause governments to reinstitute some or all of the previously implemented restrictive measures.
Added
These deferred tax assets consist primarily of federal and state net operating loss carryforwards of approximately $30,520 at the federal level and $3,670 at the state level. We evaluate the realizability of our deferred tax assets on a quarterly basis in accordance with ASC 740, weighing both positive and negative evidence.
Removed
Such restrictions could lead to the cancellation of industry events which could limit our ability to meet with existing and potential new customers. Risks Related to Our Common Stock and the Market for Our Common Stock Our share price may be volatile and could decline substantially.
Added
Significant factors in this assessment include our cumulative results over the most recent three-year period, projected future taxable income, the nature and timing of reversals of existing temporary differences, and available tax planning strategies.
Added
As of December 31, 2025, we were in a three-year cumulative loss position, which represents significant negative evidence under ASC 740, and accordingly we concluded that a full valuation allowance was required.
Added
Changes in our future earnings would result in a release of the valuation allowance and recognized in the period which the assessments change, as deemed appropriate under ASC 740.
Added
In future periods, if we determine that sufficient positive evidence exists to conclude that it is more likely than not that some or all of our deferred tax assets will be realized, we would reduce or eliminate the valuation allowance, resulting in a non-cash income tax benefit that could be material to our results of operations in the period of release.
Added
Any such benefit would not represent a change in cash flows or operating performance. Conversely, if we incur additional losses or 17 Table of Contents determine that the expected future taxable income is insufficient to support the realization of our deferred tax assets, we could be required to increase the valuation allowance, which would result in additional income tax expense.
Added
Our federal net operating loss carryforwards include approximately $10,892 generated prior to 2018 that will expire if unused between 2035 and 2037, and approximately $19,628 generated after 2017 that may be carried forward indefinitely but are limited to offsetting 80% of taxable income in any given year.
Added
Our ability to utilize these carryforwards could be limited or eliminated by future changes in tax law or by an ownership change as defined under Section 382 of the Internal Revenue Code.
Added
We have not completed a formal analysis to determine whether any ownership changes have occurred that could limit our ability to utilize our net operating loss and tax credit carryforwards.
Added
If such a change has occurred, or occurs in the future, the annual amount of our carryforwards available to offset taxable income could be materially limited, which could result in a significant increase in our future income tax liability.
Added
We may need to raise additional capital in the future, which may not be available to us on terms that are favorable to us, or at all, and could cause dilution to our existing stockholders We had cash and cash equivalents of $9,650 and working capital of $10,123 as of December 31, 2025.
Added
Our ability to fund our operations and execute our business strategy depends on our generating sufficient cash flows from operations and, when necessary, accessing capital markets or other financing sources. Additionally, acquisition and development opportunities and other contingencies may arise, which could also require us to raise additional capital through accessing capital markets or other financing sources.
Added
We may not be able to raise capital when the need arises on terms favorable to 18 Table of Contents us, or at all.

… 2 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

7 edited+1 added−1 removed5 unchanged
Biggest changeWe also maintain a privacy risk management program to assess risks related to user data collection, with an independent third-party privacy assessor to ensure compliance. These processes enable us to make informed, risk-based decisions and prioritize cybersecurity measures and risk mitigation strategies.
Biggest changeWe engage third-party security experts and consultants to assist with assessment and enhancement of our cybersecurity risk management processes, as well as benchmarking against industry practices. We also maintain a privacy risk management program to assess risks related to user data collection, with an independent third-party privacy assessor to ensure compliance.
In 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats.
In 2025, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats.
Our VP of Technology Operations and Information Security serves as the Company’s designated Chief Information Security Officer and is responsible for developing and implementing the cybersecurity risk management program, including reporting on cybersecurity matters to the Board of Directors. The VP of Technology Operations and Information Security has more than 19 years of experience leading cybersecurity oversight.
Our Director of Information Technology and Security serves as the Company’s designated Chief Information Security Officer and is responsible for developing and implementing the cybersecurity risk management program, including reporting on cybersecurity matters to the Board of Directors. The Director of Information Technology and Security has more than 15 years of experience of cybersecurity oversight.
For additional information about these risks, see Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K. 19 Table of Contents
For additional information about these risks, see Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K.
Additionally, we employ procedures to supervise and identify significant risks arising from cybersecurity threats linked to our utilization of third-party technology and systems, such as encryption and authentication systems, employee email services, back-office support systems, and other operational functions.
Additionally, we employ procedures to supervise and identify significant risks arising from cybersecurity threats linked to our utilization of third-party technology and systems, such as encryption and authentication systems, employee email services, back-office support systems, and other operational functions. 19 Table of Contents We adhere to a risk management framework based on applicable laws and regulations, incorporating industry standards and recognized practices to handle cybersecurity risks across our products, services, infrastructure and corporate assets.
Our risk mitigation efforts encompass a range of technical and operational actions, alongside annual cybersecurity and privacy training for all staff members. Our cybersecurity risks and associated mitigations are evaluated by our IT team, including our VP of Technology Operations and Information Security, as part of our enterprise risk assessments that are reviewed by our management team.
Our cybersecurity risks and associated mitigations are evaluated by our IT team, including our Director of Information Technology and Security, as part of our enterprise risk assessments that are reviewed by our management team.
We regularly conduct risk assessments to gauge the effectiveness and maturity of our systems, identifying areas for improvement. We also engage third-party security experts and consultants to assist with assessment and enhancement of our cybersecurity risk management processes, as well as benchmarking against industry practices.
To evaluate and address cybersecurity threats, we analyze factors such as threat intelligence, first- and third-party vulnerabilities, changing regulatory requirements and observed incidents. We regularly conduct risk assessments to gauge the effectiveness and maturity of our systems, identifying areas for improvement.
Removed
We adhere to a risk management framework based on applicable laws and regulations, incorporating industry standards and recognized practices to handle cybersecurity risks across our products, services, infrastructure and corporate assets. To evaluate and address cybersecurity threats, we analyze factors such as threat intelligence, first- and third-party vulnerabilities, changing regulatory requirements and observed incidents.
Added
These processes enable us to make informed, risk-based decisions and prioritize cybersecurity measures and risk mitigation strategies. Our risk mitigation efforts encompass a range of technical and operational actions, alongside annual cybersecurity and privacy training for all staff members.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−1 removed0 unchanged
Biggest changeItem 2. Properties Our corporate headquarters is currently located in Melville, New York, where we occupy approximately 135 square feet of office space pursuant to a month-to-month lease. While all personnel currently operate out of their individual home offices throughout the country, this facility is primarily used for periodic, necessary in-person meetings.
Biggest changeItem 2. Properties Our corporate headquarters currently is located in Melville, New York, where we occupy approximately 135 square feet of office space pursuant to a month-to-month lease. While all personnel currently operate out of their individual home offices throughout the country, this facility is primarily used for periodic, necessary in-person meetings.
We believe that our existing facility is adequate to meet current requirements and that additional or substitute space will be available as needed to accommodate any expansion of operations. Item 3.
We believe that our existing facility is adequate to meet current requirements and that additional or substitute space will be available as needed to accommodate any expansion of operations.
Removed
Legal Proceedings We are not currently involved in any legal or regulatory proceeding, or arbitration, the outcome of which is expected to have a material adverse effect on our business. Item 4. Mine Safety Disclosures None 20 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+0 added−2 removed1 unchanged
Biggest change(e) Recent Sales of Unregistered Securities None. (f) Issuer Purchases of Equity Securities There were no shares repurchased during 2024. Item 6. [Reserved]
Biggest change(d) Securities Authorized for Issuance Under Equity Compensation Plans The information required by Item 5 of Form 10-K regarding equity compensation plans is incorporated herein by reference to Item 12 of Part III of this Annual Report on Form 10-K. (e) Recent Sales of Unregistered Securities None. (f) Issuer Purchases of Equity Securities There were no shares repurchased during 2025.
The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees. (c) No cash dividends or other cash distributions were made by us during the fiscal year ended December 31, 2024.
The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees. (c) No cash dividends or other cash distributions were made by us during the fiscal year ended December 31, 2025.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Our common stock is traded on The Nasdaq Stock Market under the symbol “IDN.” (b) As of March 31, 2025, there were 28 shareholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Our common stock is traded on The Nasdaq Stock Market under the symbol “IDN.” (b) As of March 19, 2026, there were 8 shareholders of record of our common stock.
Removed
(d) Securities Authorized for Issuance Under Equity Compensation Plans The following table provides information as of December 31, 2024, with respect to the shares of our common stock that may be issued under our existing equity compensation plans.
Removed
Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) Weighted-average exercise price of outstanding options, warrants and rights (b) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) Equity compensation plans approved by security holders (1) 1,186,991 $ 2.94 736,175 Equity compensation plans not approved by security holders N/A N/A Total 1,186,991 $ 2.94 736,175 (1) Represents 1,151,104 options, 35,887 restricted stock units and zero performance stock units under the 2015 Omnibus Incentive Plan.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

32 edited+18 added−9 removed18 unchanged
Biggest changeThe reconciliation of GAAP net loss to Non-GAAP Adjusted EBITDA is as follows: Year Ended December 31, 2024 2023 Net loss $ (918) $ (1,980) Reconciling items: Restructuring severance expenses 376 548 Provision for income taxes 33 (62) Sales tax accrual — 227 Interest income (283) (234) Depreciation and amortization 436 282 Stock-based compensation including liability classified awards 876 1,596 Adjusted EBITDA $ 520 $ 377 24 Table of Contents Net Operating Loss Carry Forwards Our available net operating loss (“NOL”) as of December 31, 2024 was approximately $28,500, of which $10,900 expires between 2035 and 2037.
Biggest changeAdjusted EBITDA as defined by us may not be comparable with similarly named measures provided by other companies. 25 Table of Contents The reconciliation of GAAP net income (loss) to Non-GAAP Adjusted EBITDA is as follows: Year Ended December 31, 2025 2024 Net income (loss) $ 1,273 $ (918) Reconciling items: Restructuring severance expenses — 376 Provision for income taxes 58 33 Other income, net (245) (283) Depreciation and amortization 703 436 Stock-based compensation 777 876 Adjusted EBITDA $ 2,566 $ 520 Net Operating Loss Carry Forwards Our available net operating loss (“NOL”) as of December 31, 2025 was approximately $30,520, of which $10,892 expires between 2035 and 2037.
We believe that these limitations are compensated by providing Adjusted EBITDA only with GAAP net loss and clearly identifying the difference between the two measures. Consequently, Adjusted EBITDA should not be considered in isolation or as a substitute for net loss presented in accordance with GAAP.
We believe that these limitations are compensated by providing Adjusted EBITDA only with GAAP net income (loss) and clearly identifying the difference between the two measures. Consequently, Adjusted EBITDA should not be considered in isolation or as a substitute for net income (loss) presented in accordance with GAAP.
In accordance with authoritative guidance, we begin to capitalize our costs to develop software when preliminary development efforts are successfully completed, management has authorized and committed project funding, and it is probable that the project will be completed and the software will be used as intended.
In accordance with authoritative guidance, we capitalize our costs to develop software when preliminary development efforts are successfully completed, management has authorized and committed project funding, and it is probable that the project will be completed and the software will be used as intended.
Under Accounting Standards Codification (“ASC”) 606, “ Revenue from Contracts with Customers, ” revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration expected to be received in exchange for those goods or services.
Under Accounting Standards Codification (“ASC”) 606, 21 Table of Contents “ Revenue from Contracts with Customers, ” revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration expected to be received in exchange for those goods or services.
In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as well as further disaggregation of income taxes paid.
Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as well as further disaggregation of income taxes paid.
Adjusted EBITDA is calculated by adjusting net loss for certain reductions such as interest and other income (expense) and certain addbacks such as non-restructuring severance expenses, sales tax accrual, provisions for income taxes, depreciation, amortization and stock-based compensation expense. Adjusted EBITDA is provided to investors to supplement the results of operations reported in accordance with GAAP.
Adjusted EBITDA is calculated by adjusting net income (loss) for certain reductions such as restructuring severance expenses, interest and other income, provisions for income taxes, depreciation, amortization and stock-based compensation expense. Adjusted EBITDA is provided to investors to supplement the results of operations reported in accordance with GAAP.
We currently anticipate that our available cash, expected cash from operations and availability under the revolving credit agreement will be sufficient to meet our anticipated working capital and capital expenditure requirements for at least the next 12 months from the date of filing of these financial statements.
We currently anticipate that our available cash and expected cash from operations will be sufficient to meet our anticipated working capital and capital expenditure requirements for at least the next 12 months from the date of filing of these financial statements.
We also 22 Table of Contents capitalize costs related to specific upgrades and enhancements when it is probable the expenditure will result in additional functionality and expense costs incurred for maintenance and minor upgrades and enhancements.
We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditure will result in additional functionality and expense costs incurred for maintenance and minor upgrades and enhancements.
In accordance with the Tax Cuts and Jobs Act of 2017 (the "Tax Act"), U.S. NOLs arising in a tax year ending after 2017 in the amount of $17,600 will not expire, but are subject to 80% limitation on utilization. In addition to the NOLs, the Company has approximately $700 of research and development credits.
In accordance with the Tax Cuts and Jobs Act of 2017 (the "Tax Act"), U.S. NOLs arising in a tax year ending after 2017 in the amount of $19,628 will not expire, but are subject to 80% limitation on utilization. In addition to the NOLs, the Company has approximately $682 of research and development credits.
However, there are significant limitations to the use of Adjusted EBITDA since it excludes non-restructuring severance expenses, sales tax accrual, provisions for income taxes, interest and other (expense) income, impairments of long-lived assets and goodwill, stock-based compensation expense, all of which impact our profitability, as well as depreciation and amortization related to the use of long-term assets which benefit multiple periods.
However, there are significant limitations to the use of Adjusted EBITDA since it excludes restructuring severance expenses, interest and other income, provisions for income taxes, stock-based compensation expense, all of which impact our profitability, as well as depreciation and amortization related to the use of long-term assets which benefit multiple periods.
Our products include solutions 21 Table of Contents for preventing identity fraud across any industry delivered via smartphone, tablet, POS integration or other electronic devices.
Our products include solutions for preventing identity fraud across any industry delivered via smartphone, tablet, POS integration or other electronic devices.
Cash provided by investing activities for the year ended December 31, 2024 was $2,895 as compared to cash used in investing activities of $(414) for the year ended December 31, 2023.
Cash used in investing activities for the year ended December 31, 2025 was $(265) as compared to cash provided by investing activities of $2,895 for the year ended December 31, 2024.
Valuation of long-lived assets Our long-lived assets include property and equipment, goodwill, and intangible assets. As of December 31, 2024, the balances of property and equipment, goodwill and intangible assets, all net of accumulated depreciation and amortization, were $536, $8,102 and $2,374, respectively.
As of December 31, 2024, the balances of property and equipment, goodwill and intangible assets, all net of accumulated depreciation and amortization, were $536, $8,102 and $2,374, respectively.
By excluding non-cash charges such as impairments of long-lived assets and goodwill, sales tax accrual, amortization, depreciation and stock-based compensation, as well as non-operating charges for interest and provisions for income taxes, investors can evaluate our operations and can compare the results on a more consistent basis to the results of other companies.
By excluding non-cash charges such as amortization, depreciation and stock-based compensation, as well as non-operating charges for interest and provisions for income taxes, investors can evaluate our operations and can compare the results on a more consistent basis to the results of other companies.
As a result of the factors noted above, we had net losses of $(918), or $(0.05) per share, for the year ended December 31, 2024 as compared to a net loss of $(1,980), or $(0.10) per share, for the year ended December 31, 2023.
As a result of the factors noted above, we had net income of $1,273, or $0.07 per share, for the year ended December 31, 2025 as compared to a net loss of $(918), or $(0.05) per share, for the year ended December 31, 2024.
Cash provided by financing activities was $485 for the year ended December 31, 2024 as compared to cash used in financing activities of $(155) for the year ended December 31, 2023.
Cash provided by financing activities was $708 for the year ended December 31, 2025 as compared to cash provided by financing activities of $485 for the year ended December 31, 2024.
Cash used in operating activities was $(2,694) for the year ended December 31, 2024 as compared to cash used in operating activities of $(647) for the year ended December 31, 2023.
Cash provided by operating activities was $4,541 for the year ended December 31, 2025 as compared to cash used in operating activities of $(2,694) for the year ended December 31, 2024.
The Company adopted this standard effective January 1, 2024 and was applied retrospectively. The adoption of this new standard did not have a material impact on the Company's consolidated financial statements.
This change is effective for annual periods beginning after December 15, 2024. The Company adopted this standard effective January 1, 2025 and was applied retrospectively. The adoption of this new standard did not have a material impact on the Company's consolidated financial statements.
Gross profit increased by $635 or 4%, to $18,166 for the year ended December 31, 2024, compared to $17,531 in the year ended December 31, 2023. Our gross profit, as a percentage of revenues, was 90.8% and 92.7% for the years ended December 31, 2024 and 2023, respectively. OPERATING EXPENSES .
Gross profit increased by $2,334 or 13%, to $20,500 for the year ended December 31, 2025, compared to $18,166 in the year ended December 31, 2024. Our gross profit, as a percentage of revenues, was 90.4% and 90.8% for the years ended December 31, 2025 and 2024, respectively. OPERATING EXPENSES .
Operating expenses, which consist of selling, general and administrative expenses and research and development expenses, decreased by $(473), or (2.4)% to $19,334 for the year ended December 31, 2024 from $19,807 for the year ended December 31, 2023.
Operating expenses, which consist of selling, general and administrative expenses and research and development expenses, increased by $80, or 0.4% to $19,414 for the year ended December 31, 2025 from $19,334 for the year ended December 31, 2024.
SaaS revenues, which consists of software licensed on a subscription basis, increased $1,215 or 7% to $19,810 for the year ended December 31, 2024 compared to $18,595 for the year ended December 31, 2023. GROSS PROFIT .
SaaS revenues, which consists of software licensed on a subscription basis, increased $2,626 or 13% to $22,436 for the year ended December 31, 2025 compared to $19,810 for the year ended December 31, 2024. GROSS PROFIT .
Liquidity and Capital Resources As of December 31, 2024, we had cash and cash equivalents of $4,666, working capital (defined as current assets minus current liabilities) of $6,726, total assets of $20,933 and stockholders’ equity of $17,747. For the year ended December 31, 2024, our cash increased by $686.
Liquidity and Capital Resources As of December 31, 2025, we had cash and cash equivalents of $9,650, working capital (defined as current assets minus current liabilities) of $10,123, total assets of $24,481 and stockholders’ equity of $20,697. For the year ended December 31, 2025, our cash increased by $4,984.
As of December 31, 2023, the balances of property and equipment, goodwill and intangible assets, all net of accumulated depreciation and amortization, were $666, $8,102 and $575, respectively.
Valuation of long-lived assets Our long-lived assets include property and equipment, goodwill, and intangible assets. As of December 31, 2025, the balances of property and equipment, goodwill and intangible assets, all net of accumulated depreciation and amortization, were $394, $8,102 and $2,077, respectively.
Selling, general and administrative expenses increased by $350, or 2%, to $15,477 for the year ended December 31, 2024, compared to $15,127 for the year ended December 31, 2023. This increase was primarily driven by higher general and administrative costs, specifically headcount-related expenses tied to severance expenses.
Selling, general and administrative expenses decreased by $(1,377), or 9%, to $14,100 for the year ended December 31, 2025, compared to $15,477 for the year ended December 31, 2024. This decrease was primarily driven by lower general and administrative costs, specifically headcount-related expenses tied to severance expenses.
Research and development expenses decreased $823, or 18%, to $3,857 for the year ended December 31, 2024, compared to $4,680 for the year ended December 31, 2023. This decrease was primarily due to the capitalization of certain software development expenses, as well as lower personnel costs and their related stock-compensation expenses. INTEREST AND OTHER INCOME .
Research and development expenses increased $1,457, or 38%, to $5,314 for the year ended December 31, 2025, compared to $3,857 for the year ended December 31, 2024. This increase was primarily due to less capitalization of certain software development expenses, as well as higher personnel costs and their related stock-compensation expenses. OTHER INCOME AND EXPENSE .
Revenues for the year ended December 31, 2024 increased $1,091 or 6% to $19,997 compared to $18,906 for the year ended December 31, 2023. The increase in revenues is primarily the result of higher SaaS revenue for the current period.
Results of Operations COMPARISON OF THE YEAR ENDED DECEMBER 31, 2025 TO THE YEAR ENDED DECEMBER 31, 2024 REVENUES . Revenues for the year ended December 31, 2025 increased $2,669 or 13% to $22,666 compared to $19,997 for the year ended December 31, 2024. The increase in revenues is primarily the result of higher SaaS revenue for the current period.
We consider Adjusted EBITDA to be an important indicator of our operational strength and performance of our business and a useful measure of our historical operating trends.
In addition, Adjusted EBITDA is one of the primary measures that management uses to monitor and evaluate financial and operating results. We consider Adjusted EBITDA to be an important indicator of our operational strength and performance of our business and a useful measure of our historical operating trends.
Recently Issued Accounting Pronouncements Except as discussed below, we do not expect the impact of the future adoption of recently issued accounting pronouncements to have a material impact on our financial statements.
Recently Issued Accounting Pronouncements Except as discussed below, we do not expect the impact of the future adoption of recently issued accounting pronouncements to have a material impact on our financial statements. In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses .
Interest income was $283 for the year ended December 31, 2024, compared to interest income of $234 during the year ended December 31, 2023. INCOME TAXES . Our provision for income taxes was $33 for the year ended December 31, 2024, compared to a benefit from income taxes of $(62) during the year ended December 31, 2023. NET LOSS .
Our provision for income taxes was $58 for the year ended December 31, 2025, compared to $33 during the year ended December 31, 2024. 23 Table of Contents NET INCOME .
We exercise judgment in determining the point at which various projects may be capitalized, in assessing the ongoing value of the capitalized costs and in determining the estimated useful lives over which the costs are amortized. Results of Operations COMPARISON OF THE YEAR ENDED DECEMBER 31, 2024 TO THE YEAR ENDED DECEMBER 31, 2023 REVENUES .
We exercise judgment in determining the point at which various projects may be capitalized, in assessing the ongoing value of the capitalized costs and in determining the estimated useful lives over which the costs are amortized. Income Taxes and Valuation Allowance We account for income taxes in accordance with ASC 740, Income Taxes.
There can be no assurance that we will be able to secure the additional funds when needed or obtain such on terms satisfactory to us, if at all. Adjusted EBITDA and Use as a Non-GAAP Measure We use Adjusted EBITDA as a non-GAAP financial performance measurement.
In August 2025, we filed an S-3, also know as a Shelf Registration, that would allow us to sell shares in the market if the need arises. There can be no assurance that we will be able to secure the additional funds when needed or obtain such on terms satisfactory to us, if at all.
This change is effective for annual periods beginning after December 15, 2024. This change will apply on a prospective basis to annual financial statements for periods beginning after the effective date. However, retrospective application in all prior periods presented is permitted. The Company is currently evaluating the impact of this ASU on its financial statements.
ASU 2025-06 is effective for annual reporting periods beginning after December 15, 2027, and may be applied prospectively, retrospectively, or using a modified transition approach. The Company is in process of evaluating the impact of the adoption of this ASU on its financial statements.
Removed
On February 6, 2019, we entered a revolving credit facility with Citi Personal Wealth Management that allows for borrowings up to the lesser of (i) $2,000 or (ii) the collateralized balance in our existing fixed income investment account with Citi Personal Wealth Management.
Added
The Company also has a revenue model where customers purchase access to the Company's platform that includes a fixed, non-refundable annual access fee associated with a spend commitment that grants the customers stand-ready access to the platform. Revenue for this access is recognized ratably over the contract term, consistent with the nature of the stand-ready service.
Removed
The facility bears interest at a rate consistent of Citi Personal Wealth Management’s Base Rate (9.00% and 8.50% at December 31, 2024 and December 31, 2023, respectively) minus 2% subject to certain limitations.
Added
Under this standard, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as for net operating loss and tax credit carryforwards.
Removed
Interest is payable monthly and as of December 31, 2023, there were no amounts outstanding 23 Table of Contents under this facility and unused availability under this facility was $2,000. The Company is not subject to any financial covenants related to this revolving line of credit.
Added
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. 22 Table of Contents We establish a valuation allowance against deferred tax assets when, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
Removed
This line will remain open as long as the Company keeps a depository relationship with the financial institution.
Added
In making this determination, we consider all available positive and negative evidence, including: • Our cumulative results for the most recent three-year period, adjusted for permanent differences between book and taxable income; • The nature, frequency, and magnitude of current and cumulative financial reporting income and losses; • Our forecasts of future taxable income, considering the predictability and sustainability of recent operating trends; • The length of time net operating loss and tax credit carryforwards remain available, including the distinction between carryforwards with definite expiration dates and those that carry forward indefinitely; • The nature and timing of reversals of existing taxable and deductible temporary differences; and • Available tax planning strategies that could be implemented, if necessary, to accelerate taxable income.
Removed
We have included any severance-related expenses for terminated positions that will not be replaced as "non-restructuring severance expenses" within Adjusted EBITDA. In addition, Adjusted EBITDA is one of the primary measures management uses to monitor and evaluate financial and operating results.
Added
As of December 31, 2025, we maintained a full valuation allowance of approximately $6,677 against our net deferred tax assets. Our three-year cumulative result through December 31, 2025, after adjusting for permanent differences, remained in a loss position, which constitutes significant objective negative evidence under ASC 740.
Removed
Adjusted EBITDA as defined by us may not be comparable with similarly named measures provided by other companies.
Added
While we generated pre-tax income of approximately $1,331 during the year ended December 31, 2025, representing a meaningful improvement from prior-year losses of $2,042 in 2023 and $885 in 2024, we have not yet established a sustained pattern of profitability sufficient to overcome this negative evidence. This assessment requires significant judgment.
Removed
Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which enhances reporting requirements under Topic 280.
Added
Should we continue to generate taxable income in future periods such that the three-year cumulative result transitions to a positive position, and should we conclude that the weight of positive evidence outweighs the negative evidence, we may determine that a partial or full release of the valuation allowance is appropriate.
Removed
The enhanced disclosure requirements include: title and position of the Chief Operating Decision Maker (CODM), significant segment expenses provided to the CODM, extending certain annual disclosures to interim periods, clarifying single reportable segment entities must apply ASC 280 in its entirety, and permitting more than one measure of segment profit or loss to be reported under certain circumstances.
Added
Any such release would be recorded as a non-cash deferred income tax benefit in the period the determination is made and could be material to our results of operations. Based on the gross deferred tax assets as of December 31, 2025, a full release of the valuation allowance would result in a tax benefit of approximately $6,677.
Removed
In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses .
Added
Interest and other income, net, was $245 for the year ended December 31, 2025, compared to interest income of $283 during the year ended December 31, 2024. INCOME TAXES .
Added
Use of Non-GAAP Measures Adjusted Gross Profit We use Adjusted Gross Profit as a non-GAAP financial performance measurement. Adjusted Gross Profit is calculated by adjusting gross profit for the reduction of amortization expense. Adjusted Gross Profit is provided to investors to supplement the results of operations reported in accordance with GAAP.
Added
We believe Adjusted Gross Profit is important because it focuses on the current operating performance, as amortization expense does not accurately reflect the current costs required to maintain the operational usage of our service. Rather, amortization expense reflects the allocation of historical software development costs over their estimated useful lives.
Added
As an indicator of our operating performance, Adjusted Gross Profit should not be considered an alternative to, or more meaningful than, gross profit as determined in accordance with GAAP.
Added
Our Adjusted Gross Profit may not be 24 Table of Contents comparable to a similarly titled measure of another company because other entities may not calculate Adjusted Gross Profit in the same manner.
Added
Year Ended December 31, 2025 2024 Revenues $ 22,666 $ 19,997 Cost of revenues, exclusive of amortization 1,667 1,650 Amortization allocable to cost of revenues 499 181 Gross profit 20,500 18,166 Add: Amortization allocable to cost of revenues 499 181 Adjusted gross profit 20,999 18,347 Gross profit as a percentage of revenues 90.4 % 90.8 % Adjusted gross profit as a percentage of revenues 92.6 % 91.7 % Adjusted EBITDA We use Adjusted EBITDA as a non-GAAP financial performance measurement.
Added
In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets . This standard allows entities to apply a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers.
Added
The standard is effective for all the entities for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years. Early adoption is permitted, and the standard is to be applied prospectively.
Added
The Company will adopt this ASU in the first quarter of 2026 and adoption is not expected to have a material impact on our consolidated financial statements.
Added
In September 2025, the FASB issued ASU 2025-06, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which modernizes the accounting for internal-use software by replacing the previous stage-based model and aligning the capitalization process with current 26 Table of Contents development practices, especially agile and iterative methods.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed0 unchanged
Biggest changeWe therefore do not expect our results of operations or cash flows to be materially affected by a sudden change in market interest rates.
Biggest changeWe therefore do not expect our results of operations or cash flows to be materially affected by a sudden change in market interest rates. Item 8. Financial Statements and Supplementary Data Our financial statements and supplementary data are attached hereto beginning on Page F-1. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures None.
We do not enter into investments for trading or speculative purposes. Due to the short-term nature of our investment portfolio, the effect of a hypothetical 100 basis point change in interest rates would not have a material effect on the fair market value of our portfolio as of December 31, 2024.
We do not enter into investments for trading or speculative purposes. Due to the short-term nature of our investment portfolio, the effect of a hypothetical 100 basis point change in interest rates would not have a material effect on the fair market value of our portfolio as of December 31, 2025.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk As of December 31, 2024, we had cash and cash equivalents of $4,666. The primary objectives of our investment activities are the preservation of capital, the fulfillment of liquidity needs, and the fiduciary control of cash and investments.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk As of December 31, 2025, we had cash and cash equivalents of $9,650. The primary objectives of our investment activities are the preservation of capital, the fulfillment of liquidity needs, and the fiduciary control of cash and investments.

Other IDN 10-K year-over-year comparisons