Nordic biometrics providers report progress, hiccups in global sales

Selling software and products to the other side of the world can be complicated business, as Nordic fingerprint biometrics providers are experiencing. Quarterly reports from Next Biometrics, Precise Biometrics and Fingerprint Cards illustrate challenges from reporting sales accurately to the vagaries of geopolitics.

Next stickhandles through reporting irregularity, slowdown in China

A reporting issue and slow sales of fingerprint scanners in China is largely responsible for Next Biometrics announcing revenues of negative 2.2 million Norwegian kroner (approximately US$210,000) despite adjusted revenue of NOK 4.3 million ($420,000) in the second quarter of fiscal 2025.

A negative adjustment of NOK 6.5 million ($630,000) comes from expected product returns and changing conditions in the Chinese market. But historical sales are also affected by what CEO Ulf Ritsvall calls “uncovered irregularities in China relating to historical sales, payment terms and order processes.”

The transactions in question all took place in the second half of 2024, and preliminary restatements knock NOK 12.6 million ($1.2 million) off Next’s revenues and NOK 3.7 million ($360,000) in incentive fees off its costs. The company’s overall 2024 loss after taxes was adjusted from NOK 45.2 million ($4.4 million) to NOK 54.1 million ($5.3 million), Next reports.

The quarterly results for Next were also dragged down by a slower-than expected return of sales in India following the pause to allow for the implementation of L1 biometric liveness detection requirements.

Adjusted EBITDA in the quarter was negative NOK 14.2 million ($1.4 million).

Ritsvall said during an earnings presentation that the restatement has no impact on in the company’s cash situation, and that the restatement could be “turned into positive” news as returned products are shipped to new distributors.

Next did have some positive developments to review from the period, including the launch of two sensors, the Next Granite Sensor and the Next Basalt — L1 Slim.

The company is also changing the way it reports sales, with orders below NOK  5 million ($490,000) announced as a “News Release,” rather than a regulatory “Press Release.” The change, Ritsvall says, reflects Next’s momentum as a high-end fingerprint sensor provider and biometric solutions consolidator.

Precise, FPC report success navigating turbulance

Precise Biometrics dealt with what CEO Joakim Nydemark calls a “turbulent market environment and a weaker U.S. dollar” in the quarter, but the company also claims growing demand and progress towards commercialization in the second quarter.

The company reports net sales of 20.8 million Swedish kronor ($2.2 million) in Q2, roughly flat on a year-over-year basis, and an EBITDA loss of SEK 0.5 million ($52,000). The totals were slightly affected by a change in revenue allocation from a renegotiated customer agreement, and an ARR SEK 0.8 million ($83,000) difference from the bankruptcy of an unnamed partner, which could be Zwipe.

Precise is targeting commercialization in India, where its technology was recently approved for use in the Aadhaar program, early next year.

Revenues continue to climb for Fingerprint Cards, to SEK 15.7 million ($1.6 million) in Q2 from SEK 11.2 million ($1.2 million) in the same quarter a year ago. CEO Adam Philpott says the company’s transformation strategy is yielding results.

FPC’s EBITDA loss of SEK 20.3 million ($2.1 million) is even more encouraging, compared to an EBITDA of negative SEK 57.6 million ($6 million) in Q2 2024.

Philpott attributes the gains in part to traction in the high-value markets the company is pivoting to. The company also made gains in India during the quarter, however, with forming a distribution partnership with SMET and reaching a license extension agreement with Mantra Softech.

Article Topics

biometrics  |  digital identity  |  financial results  |  Fingerprint Cards  |  Next Biometrics  |  Precise Biometrics  |  stocks