Aware’s Recurring Revenue Rises to $4.007 Million Despite Decline in Total Revenue
Key Facts
Aware reported third-quarter 2026 revenue of $4.417 million, compared with $5.129 million in the same period of 2025, according to an earnings release published on October 28. Recurring revenue, meanwhile, rose to $4.007 million from $3.555 million, while software subscription revenue increased to $1.777 million from $1.182 million. This reflects an improvement in the recurring revenue mix alongside a contraction in total revenue. Nonrecurring revenue fell to $410,000 from $1.574 million, and software licenses declined to $161,000 from $1.343 million. The company’s shares closed at $0.935 in the October 28 session, up 10.87% from the previous close of $0.843, according to an Investing.com article attributed to Reuters.
Subscription growth came as perpetual license revenue contracted, a trend also seen in the second-quarter results. The company then reported revenue of $3.3 million, compared with $3.9 million in the corresponding period of 2025, attributing the decline to lower perpetual software license revenue. In July, Aware said it expected the second half to follow its usual seasonal pattern, with revenue rising compared with the first half and expenses declining as cost-cutting measures took effect. The company also said in its second-quarter results that business development activity in the public sector had increased after Department of Homeland Security operations returned to normal following funding disruptions. In its third-quarter release, it noted an increase in requests for proposals for biometric identity programs it tracks after funding was restored to most of the Department of Homeland Security. It said, however, that federal procurement cycles remained difficult to predict.
On the business front, Aware said a government entity selected it to deploy Intelligent Liveness capabilities from the Awareness platform. The release described this as a new government engagement in the high-assurance identity environment and an opportunity to prove the product, not an announcement of a broad strategic shift in government deployments. The company also announced a new commercial relationship with an Adobe Acrobat Sign distributor to provide biometric security services, alongside new customer activity in Latin America. The release did not provide a financial value for these developments. The government entity’s selection places the liveness verification product among the company’s public-sector opportunities, while management maintained its warning about the difficulty of predicting federal procurement timing. In its second-quarter results, the company had reported increased public-sector business development activity after Department of Homeland Security operations normalized.
Total costs and expenses fell to $5.357 million in the third quarter from $6.424 million a year earlier. In parallel, the operating loss narrowed to $940,000 from $1.295 million. The company posted a net loss of $791,000, or $0.04 per diluted share, compared with $1.053 million and $0.05 per share in the third quarter of 2025. Aware said cost-cutting measures are expected to generate annualized savings of about $4 million. It added that the third quarter was the first full quarter in which those savings were reflected. Despite the year-over-year improvement in expenses and losses, the company continued to post a net loss during the period.
Aware ended the quarter on September 30 with about $15.4 million in cash and cash equivalents and marketable securities, and said it had no debt. These figures provide financial context alongside growth in recurring revenue and lower expenses in a quarter when total revenue declined. The company had set October 28, 2026, for a webcast to discuss its third-quarter results at 5:00 p.m. Eastern time. It said the results would be released before the call, followed by a question-and-answer session. The stock closed at $0.935 in regular trading that day, after closing at $0.843 on October 27. The increase between the two closes was 10.87%, according to an Investing.com article attributed to Reuters.