Mitek Systems Inc Q2 FY2026 Earnings Call

Good afternoon, ladies and gentlemen, and welcome to the MyTech Reports Fiscal Second Quarter 2026 Financial Results. At this time, all lines are in listening mode, and following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, May 7, 2026. I would now like to turn the conference call over to Mr. Ryan Flanagan with IRC. Please go ahead.

Thank you, Operator. Good afternoon and thank you for joining us today to discuss MITEC's Fiscal Second Quarter 2026 financial results. Joining me today are Chief Executive Officer Ed West and Chief Financial Officer Dave Lyle. Please note that today's call will include forward-looking statements and because these statements are based on the company's current intent, expectations, and projections, they are not guarantees of future performance and a variety of factors could cause actual results to differ materially. The description of these risks and uncertainties can be found in our 10Q filing dated May 7, 2026, and our other SEC filings. These forward-looking statements include, but are not limited to, our expectations around customer demand for our products and services, expansion of our check fraud defender or CFD, data consortium, the ongoing stability of our check verification business, our growth and investment plans, expected improvements in growth profits and unit economics, improvement to operating leverage and scale, expected free cash flow conversion rates, and our FY26 financial outlook and guidance. Except as required by law, we do not undertake any obligation to update these forward-looking This call will also include references to non-GAAP adjusted results. Please reference this afternoon's press release and our investor relations website for further information regarding forward-looking statements and reconciliations of GAAP to non-GAAP financial And with that, I'd like to turn the call over to Ed. Thanks, Ryan.

Good afternoon, everyone. and thank you for joining us today. For those less familiar with my tech, we provide the verification, authentication, and fraud decisioning infrastructure that high assurance institutions rely on to protect customers and stop fraud across a broad digital life cycle. Whether someone is opening an account, logging in, depositing in a check, approving a high risk payment, our role is to help determine whether that person, session, document, check, or transaction can be trusted. By leveraging our data network, leading digital fraud detection solutions, expertise, and history and financial services, we believe that we are well aligned to how the market is evolving to fight increasingly sophisticated, synthetic, AI-assisted fraud. This quarter's progress is a good indicator of that alignment. The team delivered a strong fiscal second quarter, including record revenue and record-adjusted EBITDA. With that as context, I'd like to walk through four key takeaways from this past quarter. First, fraud and identity remains our growth engine, with revenue up 28% year-over-year. Due to our data network, platform, and expertise, our customers are becoming more engaged with MyTech, both contractually and technologically. Second, our check verification solutions remain a durable, cash-generative foundation for the business, with longstanding relationships that support broader fraud and identity growth. Third, the quality of our revenue base continues to improve. Total SaaS revenue grew 18% year-over-year and now represents approximately 44% of total last 12 months revenue. And fourth, execution is showing up in the numbers. Record revenue and profitability, healthy cash flow, and a significantly stronger balance sheet. The consistent theme across all of this is that our unify and grow ethos is working. Fraud demand is increasing, customers are expanding with us, our platform is becoming more valuable as data and participation scale, and we're translating that progress into stronger financial performance. Underpinning that progress is a demand environment that continues to strengthen, and AI is exacerbating it, increasing the scale, speed, and unpredictability of attacks. AI is lowering the cost of and making it easier to create fake identities, manipulated documents, deepfake images, cloned voices, and coordinated attacks at high velocity and scale. That is making legacy tools less effective, particularly during periods of changing attack volume. This environment plays directly to MyTech strengths. Customers increasingly need a trusted partner with flexible infrastructure that scales, combined with multiple fraud detection signals and proprietary network-based data to drive better trust decisions without adding unnecessary friction or cost. Just as importantly, fraud rarely stays isolated to one institution. Once vulnerabilities are identified, attacks often spread across multiple organizations, increasing the value of a broader network that can recognize patterns early and help customers benefit from shared intelligence that no single institution can generate alone. As fraud becomes more complex, more coordinated, and more expensive to manage, we believe the need for modern identity verification, authentication, and fraud decisioning solutions will continue to grow. Now back to our first key takeaway. As institutions confront this environment, they are gravitating toward a multi-layered approach that is showing up in our results, with fraud and identity revenue up 28% year-over-year. High-quality institutions are engaging more deeply with MyTech through stronger contractual commitments, broader platform adoption, and growing participation in our data network. Reflecting this, several relationships deepened during the quarter. A flagship customer, one of the largest banks in the United Kingdom, evolved from a predominantly variable pay-as-you-go model to a new multi-year, multi-million dollar committed structure, increasing annual spend. We saw a similar pattern with a leading European information services customer, which renewed into a larger committed relationship that included expansion. These examples reflect a broader trend. As customers scale with MyTech, they increasingly choose larger multi-year contractual commitments, a positive indicator of customer confidence that improves visibility, strengthens revenue quality, and supports long-term value creation. Customers are also expanding their use of MyTech beyond a single onboarding workflow to address the broader customer lifecycle, including account login, profile changes, account recovery, step-up authentication, and higher-risk transactions. We saw clear examples of this during the quarter. A major UK bank expanded fraud decisioning across customer journeys. A leading UK digital bank broadened its relationship into Germany while adding fraud capabilities, and a major European customer adopted MyPass as part of a broader authentication strategy. Finally, participation in our data network continues to grow. Check Fraud Defender ACV now exceeds $19 million, up more than 50% year-over-year, with contributing data sets covering over 60% of U.S. checking accounts and annualized volumes now measured in the billions. Checks remain a meaningful part of the U.S. financial system, and those workflows produce rich image and behavioral data that is highly valuable for fraud detection. As participation grows, the network strengthens through greater volumes. More institutions contributing means a richer view of cross-institutional fraud patterns, better outcomes, and stronger customer ROI. During the quarter, we added another top-10 financial institution with another top-10 FI currently in pilot. This proprietary visibility is also where our broader fraud and identity strategy gains its edge. Few participants see U.S. check activity at this scale, and those signals translate into stronger decisioning across adjacent workloads. We saw that play out this quarter with the launch of the first phase of Positive Pay Plus, which strengthens controls at the point of presentment by comparing issued checks against presented items in real time and automating historically manual decisions. Because it leverages existing infrastructure with no new integration required for many customers, adoption friction is low and time to value is fast. We added a new top U.S. regional bank for these capabilities and expanded within a large existing customer. It's a clear example of how our check verification footprint creates an expansion opportunity, one that drives broader F&I platform adoption and gives customers a stronger fraud detection signal than they could have built on their own. Importantly, this value is resonating beyond the largest institutions. Through partners such as Abrego and our recently announced Tifun integration, we are broadening access to consortium-powered fraud intelligence for community and regional banks who face meaningful fraud losses and operational strain of their own. We also continue to extend the platform through strategic ecosystem partnerships that broaden reach and simplify deployment for customers, including our recently announced integration with Ping Identity to help customers embed identity verification more seamlessly across the customer journey, and our partnership with Synecdox Solutions, which brings MyTech's identity capabilities into the insurance market through its fraud orchestration platform. On to our second key takeaway. Check verification continues to operate as a durable and highly cash-generative part of MyTech and represents trusted positions with many of the largest financial institutions in North America. During the quarter, we saw multiple meaningful renewals, extensions, and license wins across leading processors and financial institutions, including activity tied to key partners such as FIS, Jack Henry, and Kandeson, as well as additional international wins. These relationships provide deep connectivity into the FI ecosystem and reinforce the critical role our solutions play in supporting high-volume, mission-critical workflows. Importantly, we're seeing these relationships evolve as customers look to address rising check fraud, exception handling, and workflow complexity. Many institutions that have historically relied on MyTech for mobile deposit are now expanding into adjacent fraud use cases. Now to our third key takeaway, we continue to improve the quality and durability of our revenue base. This quarter, SaaS revenue grew 18% year-over-year and represented approximately 44% of the total last 12-month revenue, up 40% from a year ago. We view this as a meaningful indicator of the continued evolution of our business model towards a larger, higher-quality, recurring revenue base, and this mix improvement is being driven by SaaS growth. We now estimate that a substantial and growing portion of our SaaS revenue is generated from committed contractual arrangements rather than variable pay-go or overage structures. This enhances visibility, improves durability, and reduces reliance on more volatile consumption patterns over time. Given our revenue is increasingly tied to transaction activity, usage volumes, and customer workflows rather than seat-based pricing, our model is well-aligned to where the market is going. As digital interactions grow and more decisions move into automated or machine-to-machine environments, we believe our model is well-positioned to scale alongside that activity. Taken together, these shifts are helping create a business that is increasingly recurring, visible, scalable, and resilient. And on to our fourth and final takeaway. Consistent execution is translating into stronger profitability, healthy cash generation, and a significantly improved balance sheet. We delivered record revenue and record-adjusted EBITDA quarter, reflecting the benefits of growth, improving mix, and continued operating discipline across the business. We're also seeing leverage in the model as we scale, supported by automation, tooling efficiencies, focused investment, and a disciplined cost structure. At the same time, we have taken meaningful steps to strengthen the balance sheet. Following the retirement of our convertible notes, we remain in a healthy net cash position with added flexibility, resilience, and a simplified capital structure. On capital allocation, we continue to take a balanced and disciplined approach, returning capital shareholders through share repurchases while preserving strategic flexibility. While Dave will cover the financial detail shortly, the takeaway is straightforward. Our unify and grow ethos is creating a more profitable and more resilient MyTech better position to generate and allocate capital from a position of strength. In closing, we remain confident in the direction of the business. The market continues to reinforce a simple reality. As AI makes fraud cheaper, faster, and more scalable, trust becomes more valuable. In an AI-driven fraud environment, we believe MyTech's relevance increases. We sit at the center of that shift by building a network-driven business that is designed to secure our customers' digital interactions, supported by deep integrations, proprietary data, and longstanding customer relationships. relationships. With that, I'd now like to turn the call over to Dave to walk through the financial results and our raised outlook in more detail. Thanks, Ed. I'll review our second quarter

results and then walk through our updated outlook for the rest of the year. Second quarter fiscal 2026 was a record revenue quarter for MyTech with total revenue of $54.8 million, up 6% year over year. Fraud and identity grew 28 percent and check verification declined 8 percent on renewal timing against a strong prior year comparison. Total SAS revenue grew 18 percent bringing SAS to approximately 44 percent of last 12 months revenue up from 40 percent a year ago and improving the overall mix. Adjusted EBITDA set a MYTEC record at $22.3 million, a margin of approximately 41%. Revenue scale, favorable mix, higher capitalized costs, and strong drop through from check verification in our seasonally strongest renewal quarter all contributed. Looking at revenue by portfolio, fraud and identity revenue grew 28% year over year, reflecting continued demand for for identity verification, authentication, and fraud prevention across the customer lifecycle. Fraud and identity SaaS revenue, again, led the way at 19% growth, driven by healthy transaction volumes, adoption of higher value workflows, and momentum in Check Fraud Defender. The bridge between 19% fraud and identity SaaS growth and 28% total fraud and identity growth reflects another strong quarter of biometric software licensing, making a second consecutive quarter where license activity contributed meaningfully. Customers are deepening relationships through multi-year commitments and expanded deployments, which can drive higher upfront license revenue recognition. Biometrics license activity is lumpy by nature, and we expect it to step down sequentially from these first half highs as we move through the back half of the year. With SAS being the substantial majority of fraud and identity revenue, we expect portfolio growth to track SAS growth more closely over time. Turning to check verification, revenue for the quarter was 29.1 million, driven by seasonally strong renewals and customer upgrades from legacy check reader to our modernized check intelligence solutions. On a trailing 12-month basis, check verification revenue was 88.2 million dollars consistent with the range we have we have seen previously overall check verification remains a durable highly profitable and cash generative portfolio the trusted relationships it anchors are also also create a strategic foundation for broader growth in fraud and identity non-gap gross profit for the quarter was 46.6 million and non-GAAP gross margin was 85%, a decline of approximately 270 basis points year-over-year. Roughly half of the change was mixed shift towards faster-growing SaaS and services, which carry lower gross margins than software license revenue at close to 100%. The remainder was implementation activity in early-stage pilots where costs occur ahead of revenue we expect this to moderate over the next few quarters as those customers move into production and we have already factored that trajectory into our gross margin outlook for the balance of the year beneath the headline cfd sas margins actually expanded this quarter as a re-architecture of how cft transactional data is stored materially reduced the compute costs of moving it through our analytics pipeline. We expect these efficiencies to compound as transaction volumes scale. Taken together, the underlying margin profile remains strong with attractive unit economics across the platform, with gross profit dollars per customer journey expanding as adoption deepens. Total non-GAAP operating expense was $24.8 million, improving four percent year over year as a percentage of revenue operating expense improved approximately 440 basis points to 45 percent driven by revenue growth cost discipline and prioritized investment in our highest return growth opportunities non-gap sales sales and marketing expense was 8.5 million down from 9.5 million dollars last year as a percentage of revenue sales and marketing improved by approximately 290 basis points to 15 percent this reflects a more focused go-to-market model tighter marketing spending and growing ability to sell the broader portfolio through a unified commercial approach non-gap r d expense was 7.1 million down from 8.4 million last year as a percentage of revenue r d declined by approximately 330 basis points to 13%. The reported reduction reflects capitalized development activity and higher revenue. On a cash basis, R&D investment is actually up approximately 8.5% year-to-date in AI-based decisioning, fraud intelligence, and biometrics innovation. And finally, non-GAAP GNA was $9.2 million, up from $7.8 million last year. As a percentage of revenue, GNA increased by approximately 170 basis points to 17%. This year-over-year increase is amplified by an unusually low prior year comparison, which benefited from a bad debt expense reversal. This quarter's GNA reflects a more normalized base going forward. We continue to drive discipline, automation, and efficiency across our corporate functions, and we expect to see those actions deliver leverage over the coming years. As I mentioned, adjusted EBITDA was a record $22.3 million, up 10% year-over-year, at a margin of approximately 41%. non-GAAP income tax expense was approximately 15 percent of pre-tax income resulting in non-GAAP net income of 18.5 million and adjusted diluted earnings per share of 38 cents free cash flow for the quarter was negative 2.5 million while trailing 12-month free cash flow was approximately $45 million, representing approximately 72% conversion of adjusted EBITDA. Quarterly free cash flow was driven by timing-related working capital, most notably higher accounts receivable from late quarter billings, which we substantially collected in April. This is typical of our fiscal second quarter when a concentration of check verification annual renewals closes late in the quarter, temporarily increasing receivables and reducing cash conversion. On a trailing 12-month basis, free cash flow remains healthy and within our 70% to 80% long-term conversion range. Our capital allocation priorities are unchanged, investing in high return growth, maintaining balance sheet strength, and returning excess capital to shareholders. We ended the quarter with $78 million of cash and investments and $54.5 million of total debt, resulting in a net cash position of $23.1 million. As we discussed in our last call during the quarter, we fully retired our $155 million convertible notes and drew $50 million on our term loan facility, reducing total debt by approximately $105 million versus the prior quarter and extending our nearest debt maturity to 2030, simplifying the capital structure and adding flexibility and resilience. We also returned $8 million to shareholders through share repurchases. As a reminder, we previously announced a new $50 million share repurchase program, which provides ongoing flexibility to return capital opportunistically. Turning to our updated fiscal 2026 outlook, we are raising full-year revenue guidance to $189 to $198 million, which now represents 8% year-over-year growth at the midpoint. The raise reflects stronger first-half execution and improved visibility, particularly within fraud and identity, where SAS continues to lead growth. We are also raising our full-year fraud and identity revenue outlook to $103 million to $108 million, representing approximately 17 percent growth at the midpoint. For the fiscal third quarter we expect revenue in the range of 49 to 53 million dollars this implies fiscal fourth quarter revenue in the range of 41 to 46 million broadly in line with last year's fiscal fourth quarter reflecting check verification renewal timing and the step down in biometrics license from from a strong first half importantly we anticipate fraud and identity sas will continue to step up sequentially through the balance of the year, which is a better proxy for the underlying growth trajectory of the business. We expect non-GAAP operating expense in fiscal Q3 to be in the range of $25 to $26 million, up modestly from fiscal Q2, reflecting our continued investment in R&D. Turning to profitability, we're raising our fiscal 2026 adjusted EBITDA margin guidance range to 30 to 33 percent, reflecting stronger first-half revenue, operating discipline, and an increasingly favorable SaaS mix. From a modeling perspective, we expect non-GAC gross margin to remain in the low 80s range for the rest of the year. We continue to expect capital expenditures of approximately 3.5 percent of revenue and depreciation and amortization of approximately 1% of revenue for the full year. Overall, our results reflect our Unify and Grow ethos, a more focused and scalable MyTech delivering stronger growth, expanding profitability, and durable cash generation with the flexibility to allocate capital from a position of strength. With that, operator, we are ready to take questions.

Thank you. Ladies and gentlemen, we'll now begin the question and answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. If you are using a speakerphone, please lift the handset before pressing any keys. If you wish to decline the polling process, please press the star followed by the two. One moment, please, for your first question. Your first question comes from Mike Grondahl from Northland Capital Markets.

please go ahead hey this is logan on for mike thanks for taking our question um with the rise in gen ai fraud can you give some color around how customer urgency has changed over the last six to twelve months especially with the larger banks thanks sure hello logan uh thanks for the

question we have seen a increase uh in in interest and demand because of the increase and attacks. As I mentioned in my comments, just with the cost and speed, with cost going down, the speed, the ubiquity of access to very sophisticated models for fraudsters to use around the world. They're obviously attacking locations where they want to steal or have an attack or going to an account takeover, and so we're seeing increasing issues, which is also increasing outreach and interest and working with them, partnering with them. Very importantly, you know, we used a highly layered approach, bringing forth our knowledge, our expertise, working with financial institutions in a highly regulated environment, model governance controls, and bringing in, you know, our capabilities, not just on the verification, but also the biometrics and seeking for various types of attacks that a fraudster might utilize, whether manipulating the documents, whether an injection attack, a deep fake, or another presentation. So we'll use a layered approach and also bring in other third parties to work with our customers to help prevent, detect, and prevent the fraud. So demands have been increasing in that, and I think that's going to continue to do so. Attacks have been, and they're morphing and changing. So it's a high focus of interest, and not just in financial institutions. We've actually been seeing more recently increasing demand from other sectors, which we're predominantly approaching through partners, to approach other high-risk digital interactions.

Could you double-click on that? What other verticals are you exploring for Gen AI fraud to combat that?

Well, in terms of vertical, in terms of a customer standpoint where someone who might be utilizing AI for fraud likes insurance. I mentioned a partnership with Synectics, who has a fraud orchestration platform working with insurance industries. We have a close partnership with them, and that's a very large vertical. It's related to financial services and that's supporting. Another one is the government, like in the United Kingdom, working through other channel partners who have relationships with various ministries in the United Kingdom or other governments in Europe, working to them for support government. We also have health care of interest because of the records, the access, and health care of seeing an approach. So that's several beyond just financial services. Clearly, our expertise has been centered for a long time on financial services and understanding the regulatory, the approach, the expertise, the knowledge, and then working through these partners who have a lot of expertise in some of these other verticals, utilizing our tools and capability.

Appreciate the color, and congrats on another great quarter. Hey, thanks, Logan.

Thank you. Your next question comes from Derek Greenberg from Maxim Group. Please go ahead.

Congrats on the quarter. I wanted to talk about the fraud and identity segment in terms of just the overall economics of that business. I know historically the deposits have been the cash count. I was wondering when you expect this segment to turn profitable, the fraud and identity that is.

We haven't talked about fraud and identity as a segment with or without profitability. We did, if you remember, a year ago before we changed the way we categorized our product portfolio, we had talked about getting identity to profitability, which we had done a year ago, and then we shuffled some products around to make more sense into different product groups, fraud and identity, and check verification. That being said, historically, check verification has been a very profitable heritage business for us. It not only generates a lot of cash for us but it's pretty important strategically as we've merged my tech into one my tech and it's helping our fraud and identity products grow but in terms of specific profitability

metrics we haven't put those out at this point yeah um i guess i was just curious how to think about the margins this quarter, 41% just even on margins. I was wondering, as identity eventually matures and scales, how much upside do you see from what we saw this quarter in terms of margins? First of all, I think we're at the very

early innings. Given how fast the market's growing and how large it already is, I think the opportunity is there for us. and I think we have leading-edge products to be able to compete. You'll see in the – if you look at our adjusted EBITDA guidance for the entire year of 30% to 33%, we've been raising that two quarters in a row. We feel pretty confident in that range. The adjusted EBITDA in Q2 is typically our highest quarter for adjusted EBITDA, but that's mostly driven by check verification is seasonally strongest in Q2. Typically, Q3 is second, and then Q1 and Q4 are typically weakest. So, you see a little more pressure on adjusted EBITDA margins. All in all, if you kind of look at the core of what's driving our growth, it's fraud and identity SaaS. Fraud and identity SaaS has pretty consistently been in kind of the call it 20% range, you know, fluctuates a little bit quarter to quarter depending on overages. There's certain seasonality in Q1 and Q3. But otherwise, I think we feel pretty good about those kinds of growth rates in that core part of the business. And when I say that, I really mean product portfolio that includes Mobile Verify, MyVIP, Check Fraud Defender,

MyPath, those kinds of products. And Derek, I would just add on to what What Dave is saying there, you know, it's a mindset that we've had since, you know, working together for the last year and a half in the organization and across the company. It's just that mindset of continuous improvement, continuing to drive scale efficiency, as we're seeing now with such a strong focus and growth. And as Dave talked about, how even going through the remainder of the year with the growth within SAS and F&I SAS, the scale, you know, each quarter progresses. more scale, more volume, better unit economics across the business. We've been implementing with new tooling, new capabilities, more efficiency, how we're utilizing various tools across the business. So we're actually very encouraged year-to-date progress, how we see that going and seeing improved unit economics over time. That said, we're highly focused on growth and continuing to capitalize on the opportunity that's ahead of us.

One last question. I was wondering just maybe if you could talk about, in terms of the growth, if you're seeing more from current customers on the platform expanding workflows and transactions, or if it's more driven by new customer signups on the platform, or if it's kind of just broad-based.

I would say it's fraud. Where a large part of the growth has come from is relationships that have continued to expand. As I mentioned, and as you know, in particular on the fraud and identity side, we work with numerous large financial institutions and other large high assurance businesses that have multiple divisions operate in multiple countries, multiple products, and what we find is even though the sales cycle is long and working with them and starting to roll out in the implementation of the systems, but over time as the relationships grow, we find we expand to different margins or different markets, different product uses, capabilities, step-up functions, and so that's where a lot of the growth has come, in addition to signing up several new relationships over the last several quarters, some of the largest financial institutions in North America, as well as Europe and other partners, but we're early on through that. Last, I would just say one last comment. I think you've also noticed like on part of the business on fraud where we're amping up more of a focus on our partners, and we've announced several new partner, channel partner relationships, and now having them out bringing on additional institutions like onto our fraud platform, and that's really been accelerating over the last several months, and we see there's more to go on that front, too.

Okay, got it. Thanks for taking my question. Thanks, Eric.

Thank you. And your last question comes from George Sutton from Craig Hallam. Please go ahead.

Hey, guys, Logan. I'm for George. Thanks for taking the questions. Ed, I wanted to follow up on kind of the comments you were just making there. I mean, you talked quite a bit today about expanding with existing customers and kind of that upsell motion. I was hoping you could just shed some light on what's enabling the success there. I mean, does that just kind of have to do with the better market environment, or is some of that drawn to the changes in the go-to-market that you've been making over the last year?

I mean I wouldn't say there's any one it's just having a full focus with with these organizations what's important is you know establishing and building trust trust doesn't happen overnight it's earned over time and credibility and having the results and the team we have terrific people working with these organizations and working and partnering with them in particular when there's a fraud attack and where they may be the subject of fraud coming on and about how we can work with them, having our systems and people and bringing in the expertise associated with that. And then many of these institutions, as you know, they're highly regulated. The regulatory knowledge and expertise, model governance is very important. That is our language that we speak with them. then from a go-to-market standpoint is in dialogue and conversations and trying to broaden with them and support them in many other ways. That said, we continue to bring on new relationships too, but we may be early on and they just expand over time with them. So there's also the benefit like within SaaS, it's a layered approach where you continue to add on additional contracts and we see that layering on benefit over over time as we bring on you know expansions and the new relationships and it all just adds up incremental yeah you'll

see expanded geographies expanded use cases that gives us more journeys we get more transactions per journeys with more journeys so get some nice you can union economics and expanded revenue expansion gross profit profit expansion also one of the key focuses kind of in

the industry seems to be the idea of having more kind of layers of protection on each engagement or session if you will which I think you've touched on a bit today sorry if you could just talk about sort of how that changes the scope of your monetization opportunity on the fraud and identity

side well I think it's what Dave just mentioned where you're bringing in a It's a multilayered approach, bringing in additional signals beyond just doing the verification or authentication, bringing in digital signals with the biometrics, seeking for either defake or an injection attack or some sort of other layered data that comes in for that particular journey. We could also be bringing in another third-party data as well, maybe looking at geo or device in the utilization of that particular transaction. So think of a journey within multiple transactions. The more volume, the more throughput,

better unit economics for each transaction or journey. Got it. Thanks, guys. Thank you.

Thank you. And your last question comes from Jonathan Holt from William Blair. Please go ahead.

Hi. Good afternoon. I wanted to maybe try to better understand, you know, with all the concerns out there with Claude Mythos, you know, have your discussions changed at all with banks or has prioritization potentially risen for fraud and identity solutions just given what's potentially coming down the pipe? And how do you think about maybe exploiting some of that increased concern over time?

Well, good afternoon, Jonathan. And the answer, the simple answer is yes, in terms of that the dialogue has increased. But I would say that's not just from mythos or changes with claw. It's just really AI in general and the proliferation of fraud attacks and the sophisticated nature of that. Obviously, thinking about with mythos coming out and what that does from a cyber standpoint and looking for vulnerabilities, All of this comes back to the same key point, which is around how are we protecting our franchise, how are we protecting our interactions with our customers? That's where we come in and having the conversation on that digital interaction and making sure protecting it to the greatest extent possible, We'll continue to bring in new solutions, ideas, thoughts around that based on our technologies and capabilities and experience. So the trend clearly is continuing to go up over time. The relevance of my tech has gone up significantly within the conversations. I would tell you, when I started first at the company a year and a half ago, just the profile, who we're having in dialogue with, the importance across the organization is at the highest levels of many of these institutions and the high assurance businesses that we work with because of the concern and the fraud and the sophisticated nature of the fraud that's now prevalent in the world. Thank you. Thank you.

Thank you. Ladies and gentlemen, this does conclude your conference call for today. we thank you very much for your participation and you may now disconnect have a great day everybody

thank you