Mitek Systems Reports 23% YoY Growth in SaaS Revenue, Reaches 41% of Total Revenue

Mitek Systems Inc (MITK) reported a 23% YoY growth in SaaS revenue, accounting for 41% of total revenue. Identity product revenue reached $75 million, up 13% YoY. However, deposit revenue was down 20% YoY due to challenges in maintaining growth in this segment. The company achieved a 99% free cash flow conversion rate and improved its non-GAAP operating expense intensity from 64% to 55% of revenue.

Mitek Systems Inc (MITK) reported a robust performance in its third quarter, with notable growth in SaaS revenue and improvements in operational efficiency. The company's SaaS revenue grew by 23% year-over-year (YoY) to $19.3 million, representing 41% of total revenue [1]. This growth is a significant indicator of the company's momentum in subscription-based offerings.

Identity product revenue reached $75 million, up 13% YoY, showcasing the company's success in its identity solutions portfolio [1]. However, deposit revenue declined by 20% YoY to $16.4 million, reflecting challenges in maintaining growth in this segment [1]. Despite this, the company has managed to offset potential revenue declines with increases in average selling prices (ASPs) over time [2].

Mitek Systems achieved a 99% free cash flow conversion rate over the last 12 months, demonstrating strong cash generation and operational efficiency [1]. Additionally, the company improved its non-GAAP operating expense intensity from 64% to 55% of revenue over the last 12 months, driven by cost reductions and operational efficiencies [1].

The company's non-GAAP gross margin decreased by 100 basis points YoY to 85.0%, primarily due to a shift away from higher-margin deposit products [1]. However, Mitek Systems is focusing on growing its SaaS business for better visibility and stability in the coming quarters [2].

The Check Fraud Defender product saw a 56% YoY increase in annual contract value, highlighting strong demand for fraud prevention solutions [1]. The company is optimistic about achieving its $20 million ACV target for this product, with ongoing discussions and contract negotiations with large financial institutions [2].

Mitek Systems has raised the midpoint of its revenue and adjusted EBITDA margin guidance ranges for its fiscal 2025 full year, indicating a tightening of expectations [3]. The company is executing on its strategy of shifting to SaaS, streamlining operations, and aligning product investments and go-to-market strategy around a unified, integrated platform.

References:
[1] https://finance.yahoo.com/news/mitek-systems-inc-mitk-q3-073911556.html
[2] https://ca.finance.yahoo.com/news/mitek-systems-inc-mitk-q3-073911556.html
[3] https://www.miteksystems.com/press-releases/mitek-reports-fiscal-2025-third-quarter-financial-results