0001193125-26-096448
SEC filingAware, Inc. reported a net loss of $5.9 million for fiscal year 2025, an increase from a $4.4 million loss in 2024. Total revenue was $17.3 million, a slight decrease from $17.4 million in the prior year. The operating loss widened to $6.6 million from $5.5 million, driven by increased research and development expenses ($8.3 million, up from $7.8 million) and cost of revenue ($1.3 million, up from $0.8 million). The company ended the year with $22.3 million in cash, cash equivalents, and marketable securities, which management believes is sufficient to fund operations for at least the next twelve months. Key revenue drivers included software maintenance revenue of $8.7 million (51% of total revenue) and software licenses revenue of $7.3 million (42% of total revenue).
Aware, Inc. reported a challenging fiscal year 2025 with total revenue of $17.3 million, a slight decrease from $17.4 million in 2024. The company's operating loss widened significantly to $6.6 million from $5.5 million in the prior year. Net loss increased to $5.9 million compared to $4.4 million in 2024. Key factors contributing to the increased losses included higher research and development expenses ($8.3 million, up from $7.8 million), increased cost of revenue ($1.3 million, up from $0.8 million), and a $0.2 million write-off of a note receivable to Anonybit, Inc. The company ended the year with 80 employees, including 45 in engineering and research.
Revenue composition showed software licenses representing 42% of total revenue ($7.3 million, down 4% year-over-year), software maintenance representing 51% ($8.7 million, up 2%), and services and other representing 7% ($1.3 million, up 9%). The decrease in software licenses revenue was primarily due to lower perpetual license sales, which can fluctuate period to period. Software maintenance revenue increased due to maintenance related to perpetual license sales, with SaaS revenue growing to $0.4 million from $0.1 million in 2024. Services and other revenue growth was driven by SaaS expansion, partially offset by lower professional services revenue. No customer represented 10% or more of total revenue in either 2025 or 2024.
Gross margin declined to 92.5% in 2025 from 95.4% in 2024, primarily due to increased software license costs within cost of revenue. Operating margin was -38.2%, deteriorating from -31.6% in the prior year. The company's total engineering costs increased 6% to $8.7 million, representing 50% of total revenue compared to 47% in 2024. This increase was driven by strategic initiatives and higher engineering headcount (45 employees in 2025 versus 33 in 2024). Selling and marketing expense decreased 5% to $7.3 million, while general and administrative expense increased 3% to $6.9 million, including the $0.2 million note receivable write-off.
Cash used in operating activities was $5.4 million in 2025, primarily resulting from the $5.9 million net loss and $1.3 million of working capital adjustments, partially offset by $0.6 million of depreciation and amortization and $1.2 million of stock-based compensation. The company ended the year with $22.3 million in cash, cash equivalents, and marketable securities ($7.3 million cash plus $15.0 million marketable securities). Total assets were $37.2 million, with current assets of $28.3 million. Total liabilities were $11.1 million, including $7.5 million in current liabilities. Stockholders' equity was $26.1 million, with an accumulated deficit of $75.8 million.
Management expects engineering costs to increase in 2026 due to the full-year impact of personnel hired during 2025. Research and development expenses are expected to increase in absolute dollars and as a percentage of revenue. The company plans to be strategic in expanding its sales and marketing force to pursue future opportunities. Management believes cash, cash equivalents, and marketable securities of $22.3 million will be sufficient to fund operations for at least the next twelve months. Known contractual obligations include operating lease payments estimated at approximately $0.7 million annually for 2026-2027 and $0.8 million annually for 2028-2030. The company continues to transition certain legacy software offerings to cloud-based delivery models and expects SaaS to become a significant product portfolio over time.