AWREHIGH SIGNALFINANCIAL10-K

AWRE experienced a substantial revenue decline alongside a near-complete inventory liquidation, signaling significant operational stress.

The company's revenue fell meaningfully to $16.3M while operating losses widened and cash position deteriorated by $5.7M, indicating fundamental business challenges. The 99.9% inventory reduction suggests either a major strategic shift away from physical products or potential liquidity pressures forcing asset liquidation.

Comparing 2026-03-06 vs 2025-03-13View on EDGAR →
FINANCIAL ANALYSIS

AWRE's financial position weakened considerably with revenue declining meaningfully while operating losses expanded and operating cash flow deteriorated substantially. The company's cash reserves fell from $13.0M to $7.3M, representing a concerning burn rate, while stockholders' equity contracted by 15.4%. Most notably, inventory dropped from $1.6M to just $2K, suggesting either a dramatic business model pivot or urgent liquidity management, creating uncertainty about the company's operational trajectory.

FINANCIAL STATEMENT CHANGES
Inventory
Balance Sheet
-99.9%
$1.6M→$2K

Inventory drawn down 99.9% — strong sell-through or deliberate destocking; watch for supply constraints.

Operating Cash Flow
Cash Flow
-70.8%
-$3.2M→-$5.4M

Operating cash flow fell 70.8% — earnings quality concerns; investigate working capital changes and non-cash items.

Share Buybacks
Cash Flow
-44.4%
$207K→$115K

Buyback activity reduced 44.4% — capital being redeployed elsewhere or cash conservation underway.

Cash & Equivalents
Balance Sheet
-44%
$13.0M→$7.3M

Cash declined 44% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.

Net Income
P&L
-32.5%
-$4.4M→-$5.9M

Net income declined 32.5% — review whether driven by operations, interest costs, or non-recurring items.

Revenue
P&L
-24.5%
$21.6M→$16.3M

Revenue softened 24.5% — monitor whether this is cyclical or structural.

Operating Income
P&L
-18.3%
-$5.5M→-$6.6M

Operating profitability softening — costs rising faster than revenue, watch for margin recovery plan.

Stockholders Equity
Balance Sheet
-15.4%
$30.9M→$26.1M

Equity decreased 15.4% — buybacks or losses reducing book value, monitor solvency ratios.

Current Assets
Balance Sheet
-14.3%
$33.0M→$28.3M

Current assets declined 14.3% — monitor working capital adequacy and short-term liquidity.

Total Assets
Balance Sheet
-12.8%
$42.6M→$37.2M

Total assets contracted 12.8% — asset sales, write-downs, or balance sheet optimization underway.

LANGUAGE CHANGES
NEW — 2026-03-06
PRIOR — 2025-03-13
ADDED
We also sell AwareSDK as a Software-as-a-Service (SaaS) offering, formerly known as AwareID, that provides advanced identity verification and continuous authentication capabilities.
This offering continues to provide biometric face and voice matching (1:1 and 1:N), liveness-verification (presentation attack detection), and document validation.
Pricing for our AwareSDK SaaS offering is typically usage-based or transaction-based.
AwareABIS is a highly scalable platform that performs one-to-many ( 1:N ) search or one-to-one ( 1:1 ) match against large stores of biometrics and other identity data.
Awareness Platform (formerly known as BioSP - Biometric Services Platform) The Awareness Platform is a biometric integration platform-as-a-service ( iPaaS ) used to enable biometric data processing and management functionality in a web services architecture.
With the introduction of AwareID, now the SaaS component of AwareSDK, we have incorporated SaaS offerings into our product line-up.
We recognized revenues from our SaaS offerings during 2025 and 2024 of $0.4 million and $0.1 million, respectively.
While perpetual and fixed-term licenses remain our primary source of software revenue, we continue to enhance and transition certain legacy software offerings to cloud-based delivery models and expect SaaS to become a significant product portfolio over time.
We provide services directly to end users or indirectly to end users through systems integrators or commercial entities or partners.
As of December 31, 2025, three customers combined represented 53% of our net accounts receivable and unbilled receivables, and as of December 31, 2024, two customers combined represented 34% of our net accounts receivable and unbilled receivables.
REMOVED
Going forward we plan to transition the Knomi offering to within the AwareID offering.
AwareABIS is a highly scalable platform that performs one-to-many ("1:N") search or one-to-one ("1:1") match against large stores of biometrics and other identity data.
BioSP - Biometric Services Platform BioSP is a biometric integration platform-as-a-service ("iPaaS") used to enable biometric data processing and management functionality in a web services architecture.
4 AwareID AwareID is a Software-as-a-Service (SaaS) offering that provides advanced identity verification and continuous authentication capabilities.
AwareID continues to leverage Knomi to provide biometric face and voice matching (1:1 and 1:N), liveness-verification (presentation attack detection), and document validation.
AwareID is typically provided as a SaaS offering with usage-based or transaction-based pricing, however it is also available on-premises when leveraging Knomi SDKs.
With the introduction of AwareID, we have incorporated SaaS offerings into our product line-up.
While we did not recognize material revenues from our SaaS offerings during 2024 and 2023, we continue to invest in and we expect SaaS to become a significant product offering moving forward.
We provide services directly to end-users or indirectly to end-users through systems integrators or commercial entities or partners.
As of December 31, 2024, two customers combined represented 34% of our net accounts receivable and unbilled receivables, and as of December 31, 2023, one customer represented 16%, of our net accounts receivable and unbilled receivables.
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