8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 29, 2021

MITEK SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware		001-35231	87-0418827
(State or other jurisdiction of incorporation)		(Commission File Number)	(IRS Employer Identification No.)
600 B Street, Suite 100
San Diego,	California		92101
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (619) 269-6800

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	MITK	The NASDAQ Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

On July 29, 2021, Mitek Systems, Inc. (the “Company”) issued a press release regarding the Company’s financial results for the third quarter ended June 30, 2021. The full text of the Company’s press release is attached hereto as Exhibit 99.1.

In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits. The exhibits shall be deemed to be filed or furnished, depending on the relevant item requiring such exhibit, in accordance with the provisions of Item 601 of Regulation S-K (17 CFR 229.601) and Instruction B.2 to this form.

Exhibit Number	Description
99.1	Press Release issued on July 29, 2021
104	Cover Page Interactive Data File, formatting Inline Extensible Business Reporting Language (iXBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	Mitek Systems, Inc.
July 29, 2021	By:	/s/ Frank Teruel
		Frank Teruel
		Chief Financial Officer

Exhibit Index

 

Exhibit Number	Description
99.1	Press Release issued on July 29, 2021
104	Cover Page Interactive Data File, formatting Inline Extensible Business Reporting Language (iXBRL)

EX-99.1

Mitek Reports Record Revenue Up 25% Year Over Year

and Rapid Adoption of Its Check Fraud Consortium

SAN DIEGO, CA, July 29, 2021 - Mitek (NASDAQ: MITK, www.miteksystems.com), a global leader in mobile capture and digital identity verification solutions, today reported financial results for its third quarter of fiscal 2021ended June 30, 2021. Total third quarter revenue increased 25% year over year, fueled by increased demand for both identity verification solutions and mobile deposit as commerce continues its shift to digital channels.

Fiscal Third Quarter 2021 Financial Highlights

•Total revenue increased 25% year over year to a record $31.8 million.

•GAAP net income was $3.0 million, or $0.07 per diluted share.

•Non-GAAP net income increased 56% year over year to $10.6 million, or $0.23 per diluted share.

•Cash flow from operations was $9.0 million.

•Total cash and investments were $215.5 million at the end of the quarter.

Transactional identity verification revenue continued its solid performance growing 33% year over year, and deposit solutions grew 23% year over year as consumer adoption further expands.

“We are pleased to report an all-time record revenue quarter with strong growth from both our identity and deposits businesses,” said Mitek CEO Max Carnecchia. “Mitek’s consistent, strong and rapid growth reflects the team’s commitment to helping our customers and partners accelerate their digital transformation and fight against fraud. With both the acquisition of ID R&D and the introduction of Check Fraud Defender this quarter, we continue our commitment to building trust in the digital world.”

Mitek acquired ID R&D, the leading provider of AI-based voice and face biometrics and liveness detection, during the quarter to lead the fight against biometric identity fraud.

The company also introduced Check Fraud Defender, the first AI-powered, cloud-hosted consortium for financial institutions. Twenty percent of the top 25 US banks have already licensed Check Fraud Defender technology and are experiencing up to a 90% savings in manual review time following its initial deployment. Nearly 100 percent of U.S. banks trust Mitek technology today, making it uniquely qualified to provide this service which enables financial institutions to cooperate in the fight against skyrocketing check fraud.

Mitek’s technology ensures that more businesses can transact digitally and secure their platforms through easy, fast and continuous identity verification. Almost all aspects of modern life now use digital channels, so the need to establish trust in the digital identities of customers, citizens, partners, and employees is rapidly rising. Mitek continues as the clear market leader in remote check deposit solutions, with thousands of financial organizations using its solutions, and approximately five billion transactions processed.

Conference Call Information

Mitek management will host a conference call and live webcast for analysts and investors today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to discuss the company’s financial results.

To access the live call, dial 800-367-2403 (US and Canada) or +1 334-777-6978 (International) and give the participant passcode 2203805.

A live and archived webcast of the conference call will be accessible on the Investor Relations section of the company’s website at www.miteksystems.com. In addition, a phone replay will be available

approximately two hours following the end of the call, and it will remain available for one week. To access the call replay dial-in information, pleaseclick here.

About Mitek

Mitek (NASDAQ: MITK) is a global leader in mobile capture and digital identity verification built on the latest advancements in computer vision and artificial intelligence. Mitek’s identity verification solutions enable organizations to verify an individual’s identity during digital transactions to reduce risk and meet regulatory requirements, while increasing revenue from digital channels. More than 7,500 organizations use Mitek to enable trust and convenience for mobile check deposit, new account opening and more. Mitek is based in San Diego, Calif., with offices across the U.S. and Europe. Learn more at www.miteksystems.com. [(MITK-F)]

Follow Mitek on LinkedIn, Twitter and YouTube, and read Mitek’s latest blog posts here.

Notice Regarding Forward-Looking Statements

Statements contained in this news release relating to the company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future, including, but not limited to, statements relating to the company’s long-term prospects and market opportunities are forward-looking statements. Such forward-looking statements are subject to a number of risks and uncertainties, including, but not limited to, risks related to the company’s ability to withstand negative conditions in the global economy, the extent to which the COVID-19 outbreak and measures taken in response thereto impact our business, results of operations and financial condition, a lack of demand for or market acceptance of the company’s products, the company’s ability to continue to develop, produce and introduce innovative new products in a timely manner or the outcome of any pending or threatened litigation and the timing of the implementation and launch of the company’s products by the company’s signed customers.

Additional risks and uncertainties faced by the company are contained from time to time in the company’s filings with the U.S. Securities and Exchange Commission (SEC), including, but not limited to, the company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020, and its quarterly reports on Form 10-Q and current reports on Form 8-K, which you may obtain for free on the SEC’s website atwww.sec.gov. Collectively, these risks and uncertainties could cause the company’s actual results to differ materially from those projected in its forward-looking statements and you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The company disclaims any intention or obligation to update, amend or clarify these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Note Regarding Use of Non-GAAP Financial Measures

This news release contains non-GAAP financial measures for non-GAAP net income and non-GAAP net income per share that exclude stock compensation expenses, intellectual property litigation costs, executive transition costs, acquisition-related costs and expenses, amortization of debt discount and issuance costs, income tax effect of pre-tax adjustments, and the cash tax difference. These financial measures are not calculated in accordance with generally accepted accounting principles (GAAP) and are not based on any comprehensive set of accounting rules or principles. In evaluating the company’s performance, management uses certain non-GAAP financial measures to supplement financial statements prepared under GAAP. Management believes these non-GAAP financial measures provide a useful measure of the company’s operating results, a meaningful comparison with historical results and with the results of other companies, and insight into the company’s ongoing operating performance. Further, management and the Board of Directors utilize these non-GAAP financial measures to gain a better understanding of the company’s comparative operating performance from period-to-period and as a basis for planning and forecasting future periods. Management believes these non-GAAP financial

measures, when read in conjunction with the company’s GAAP financial statements, are useful to investors because they provide a basis for meaningful period-to-period comparisons of the company’s ongoing operating results, including results of operations against investor and analyst financial models, which helps identify trends in the company’s underlying business and provides a better understanding of how management plans and measures the company’s underlying business.

MITEK SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(amounts in thousands except share data)

	June 30, 2021		September 30, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	40,549	$	19,986
Short-term investments	138,302		40,035
Accounts receivable, net	18,583		15,612
Contract assets	3,610		5,187
Prepaid expenses	1,988		1,338
Other current assets	2,163		1,968
Total current assets	205,195		84,126
Long-term investments	36,643		1,963
Property and equipment, net	3,594		3,610
Right-of-use assets	7,602		5,407
Intangible assets, net	28,557		19,289
Goodwill	67,050		35,669
Deferred income tax assets	13,773		13,484
Convertible senior notes hedge	54,334		—
Other non-current assets	5,650		5,606
Total assets	$	422,398	$	169,154
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	2,637	$	3,909
Accrued payroll and related taxes	9,532		8,882
Deferred revenue, current portion	11,896		7,973
Lease liabilities, current portion	1,928		1,819
Acquisition-related contingent consideration	9,950		753
Other current liabilities	1,660		1,020
Total current liabilities	37,603		24,356
Convertible senior notes	119,625		—
Embedded conversion derivative	54,334		—
Deferred revenue, non-current portion	614		1,597
Lease liabilities, non-current portion	7,182		5,327
Deferred income tax liabilities	7,981		4,649
Other non-current liabilities	6,535		982
Total liabilities	233,874		36,911
Stockholders’ equity:
Preferred stock, $0.001 par value, 1,000,000 shares authorized, none issued and outstanding	—		—
Common stock, $0.001 par value, 60,000,000 shares authorized, 44,018,619 and 41,779,853 issued and outstanding, as of June 30, 2021 and September 30, 2020, respectively	44		42
Additional paid-in capital	195,942		146,518
Accumulated other comprehensive income (loss)	361		(323)
Accumulated deficit	(7,823)		(13,994)
Total stockholders’ equity	188,524		132,243
Total liabilities and stockholders’ equity	$	422,398	$	169,154

MITEK SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(amounts in thousands except per share data)

	Three Months Ended June 30,				Nine Months Ended June 30,
	2021		2020		2021		2020
Revenue
Software and hardware	$	16,973	$	13,212	$	42,288	$	36,180
Services and other	14,805		12,201		44,238		34,492
Total revenue	31,778		25,413		86,526		70,672
Operating costs and expenses
Cost of revenue—software and hardware	293		623		2,208		2,258
Cost of revenue—services and other	3,117		2,873		9,132		7,357
Selling and marketing(1)	8,133		7,011		24,048		20,345
Research and development(1)	6,946		5,891		19,801		16,764
General and administrative	5,633		5,884		16,409		16,382
Acquisition-related costs and expenses	2,224		1,697		5,576		4,884
Restructuring costs	—		—		—		(114)
Total operating costs and expenses	26,346		23,979		77,174		67,876
Operating income	5,432		1,434		9,352		2,796
Interest expense	2,223		—		3,543		—
Other income, net	80		145		549		480
Income before income taxes	3,289		1,579		6,358		3,276
Income tax provision	(304)		(231)		(187)		(460)
Net income	$	2,985	$	1,348	$	6,171	$	2,816
Net income per share—basic	$	0.07	$	0.03	$	0.14	$	0.07
Net income per share—diluted	$	0.07	$	0.03	$	0.14	$	0.07
Shares used in calculating net income per share—basic	43,773		41,483		43,145		41,251
Shares used in calculating net income per share—diluted	45,194		42,428		44,646		42,239

(1) June 30, 2020 consolidated statements of operations reflect reclassifications to conform to the current year presentation.

MITEK SYSTEMS, INC.

NON-GAAP NET INCOME RECONCILIATION

(Unaudited)

(amounts in thousands except per share data)

	Three Months Ended June 30,				Nine Months Ended June 30,
	2021		2020		2021		2020
Net income	$	2,985	$	1,348	$	6,171	$	2,816
Non-GAAP adjustments:
Acquisition-related costs and expenses	2,224		1,697		5,576		4,884
Intellectual property litigation costs	128		998		645		2,032
Executive transition costs(1)	428		—		428		—
Stock compensation expense	2,867		2,501		8,582		7,112
Restructuring costs	—		—		—		(114)
Amortization of debt discount and issuance costs	1,933		—		3,080		—
Income tax effect of pre-tax adjustments	(1,743)		(1,195)		(4,211)		(3,200)
Cash tax difference(2)	1,776		1,426		3,781		3,660
Non-GAAP net income	10,598		6,775		24,052		17,190
Non-GAAP income per share—basic	$	0.24	$	0.16	$	0.56	$	0.42
Non-GAAP income per share—diluted	$	0.23	$	0.16	$	0.54	$	0.41
Shares used in calculating non-GAAP net income per share—basic	43,773		41,483		43,145		41,251
Shares used in calculating non-GAAP net income per share—diluted	45,194		42,428		44,646		42,239

(1)Comprised of costs associated with the transition of the company’s former chief financial officer. Our non-GAAP financial measures exclude these transition costs as we believe that such expense is inconsistent with the normally recurring operations of our company and the inclusion of these costs makes it difficult to make period-to-period comparisons of our operating performance.

(2)The company’s non-GAAP net income is calculated using a cash tax rate of 3% and 0% in fiscal years 2021 and 2020, respectively. The estimated cash tax rate is the estimated tax payable on the company’s tax returns as a percentage of estimated annual non-GAAP pre-tax net income. The company uses an estimated cash tax rate to adjust for the historical variation in the effective book tax rate associated with the reversal of valuation allowances, the utilization of research and development tax credits, and the utilization of loss carryforwards which currently have an overall effect of reducing taxes payable. The company believes that the cash tax rate provides a more transparent view of the company’s operating results. The company’s effective tax rate used for the purposes of calculating GAAP net income for the three months ended June 30, 2021 and 2020 was 9% and 15%, respectively. The company’s effective tax rate used for the purposes of calculating GAAP net income for the nine months ended June 30, 2021 and 2020 was 3% and 14%, respectively.

________________

Investor Contact:

Todd Kehrli or Jim Byers

MKR Group, Inc.

mitk@mkr-group.com

XML

Cover	Apr. 29, 2021
Cover [Abstract]
Document Type	8-K
Document Period End Date	Jul. 29, 2021
Entity Registrant Name	MITEK SYSTEMS, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-35231
Entity Tax Identification Number	87-0418827
Entity Address, Address Line One	600 B Street, Suite 100
Entity Address, City or Town	San Diego,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92101
City Area Code	619
Local Phone Number	269-6800
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	MITK
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0000807863
Amendment Flag	false