BIO-Key International Inc (BKYI) 2025 Q2 法說會逐字稿

Good morning, everyone. Thank you for standing by, and welcome to BIO-key International's second-quarter 2025 (technical difficulty) call. (Operator Instructions) As a reminder, this conference is being recorded today, Wednesday, August 13, 2025.

大家早安。感謝您的支持，歡迎參加 BIO-key International 2025 年第二季（技術難度）電話會議。（操作員指示）提醒一下，本次會議將於今天（2025 年 8 月 13 日，星期三）進行錄製。

I will now turn the call over to Bill Jones, Investor Relations. You may proceed.

現在我將把電話轉給投資者關係部的比爾瓊斯 (Bill Jones)。您可以繼續。

Thank you, Betsy. Hosting today are BIO-key's Chairman and CEO, Mike DePasquale; and its CFO, Ceci Welch.

謝謝你，貝琪。今天的主持人是 BIO-key 的董事長兼首席執行官 Mike DePasquale 和首席財務官 Ceci Welch。

As a reminder, today's call and webcast as well as answers to investor questions include forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ materially from current expectations. Words like anticipate, believe, expect, plan, and project, or any similar words identify and express forward-looking statements.

提醒一下，今天的電話會議和網路廣播以及對投資者問題的解答都包含前瞻性陳述，這些陳述受風險和不確定性的影響，可能導致實際結果與當前預期存在重大差異。預期、相信、期望、計劃、預測或任何類似詞語均可識別和表達前瞻性陳述。

These statements are made based on the beliefs, assumptions, and information currently available to management as of today and are pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. For a more complete description of the risks and uncertainties that may affect future performance, please see risk factors in the company's annual report on Form 10-K as filed with the Securities and Exchange Commission.

這些聲明是基於管理層目前掌握的信念、假設和訊息，並遵守 1995 年《私人證券訴訟改革法案》的安全港條款。有關可能影響未來績效的風險和不確定性的更完整描述，請參閱本公司向美國證券交易委員會提交的 10-K 表格年度報告中的風險因素。

Listeners are cautioned not to place undue reliance on forward-looking statements made as of today. And the company makes no obligation to revise or disclose revisions to such statements to reflect circumstances or events that may occur after this call.

提醒聽眾不要過度依賴今天的前瞻性陳述。本公司沒有義務修改或揭露此類聲明的修訂內容以反映本次電話會議後可能發生的情況或事件。

Now I will turn the call over to Mike to begin. Mike?

現在我將把電話交給麥克開始。麥克風？

Thanks, Bill, and thank you, all, for joining us today. After my brief remarks and Ceci's financial review, we will open the call to investor questions.

謝謝比爾，也謝謝大家今天加入我們。在我簡短發言和 Ceci 的財務回顧之後，我們將開始回答投資者的問題。

BIO-key had a solid Q2 performance, with revenue rising 49% versus last year and 6% on a sequential basis. We also advanced our expense reduction initiatives, trimming SG&A expenses by 13.5% versus last year, more than offsetting increased investments in R&D to further enhance the capabilities of our solutions. We've also reduced our note payable to a balance of $447,000 from $1.5 million at the end of December 2024.

BIO-key 第二季業績表現穩健，營收較去年同期成長 49%，較上季成長 6%。我們也推進了費用削減計劃，銷售、一般及行政費用較去年同期削減了 13.5%，這足以抵消研發投資的增加，從而進一步增強了我們解決方案的功能。我們也將應付票據餘額從 2024 年 12 月底的 150 萬美元減少至 447,000 美元。

Turning to business highlights in the quarter, BIO-key and our partner, Runlevel, secured a major identity and access management deployment with the National Bank of Mozambique. Also, in Q2, we extended our penetration of the defense intelligence market based on the capabilities and strength of our IAM and in particular, our biometric-enabled solutions.

談到本季的業務亮點，BIO-key 和我們的合作夥伴 Runlevel 與莫三比克國家銀行達成了一項重要的身分和存取管理部署。此外，在第二季度，我們憑藉 IAM 的能力和優勢，特別是生物辨識解決方案，擴大了對國防情報市場的滲透。

We are highly limited in what we can say about security and defense customer engagements. But what I can say is that we completed the first phase of a deployment for a new international defense agency customer, and a respected Middle East police force commenced a three-year PortalGuard deployment.

關於安全和防禦客戶參與，我們能說的內容非常有限。但我可以說的是，我們為一個新的國際國防機構客戶完成了部署的第一階段，並且一支受人尊敬的中東警察部隊開始了為期三年的 PortalGuard 部署。

In addition, we secured $600,000 of follow-on orders for a prominent foreign defense ministry, that bring this ongoing project to over $3 million in total revenue over the last few years. Building on our success with a growing list of foreign military and defense customers, today, we announced the formation of the BIO-key CyberDefense Initiative.

此外，我們還為一家著名的外國國防部獲得了 60 萬美元的後續訂單，這使得這個正在進行的項目在過去幾年的總收入超過 300 萬美元。基於我們與越來越多的外國軍事和國防客戶所取得的成功，今天，我們宣布成立 BIO-key 網路防禦計畫。

We plan to staff this effort with sales and support executives that have strong military and intelligence experience to guide our efforts and to expand our market reach by building engagement with leading defense industry contractors.

我們計劃為這項工作配備具有豐富軍事和情報經驗的銷售和支援高管，以指導我們的工作，並透過與領先的國防工業承包商建立合作關係來擴大我們的市場範圍。

The initial focus of the CyberDefense Initiatives will be in the EU, in Europe, where we have key reference accounts. And member countries have committed to substantially expanding military and defense investments.

網路防禦計畫的最初重點將放在歐盟，也就是我們擁有關鍵參考帳戶的歐洲。成員國已承諾大幅擴大軍事和國防投資。

Europe's Readiness 2030 framework and ReArm Europe plans aim to mobilize over EUR800 billion in defense investment over the next four years. Included within these efforts is the Security Action for Europe or SAFE loan mechanism, raising EUR150 billion for defense readiness, including missile defense, drones and, of course, cybersecurity.

歐洲的「2030戰備」框架和「歐洲重新武裝」計畫旨在未來四年調動超過8,000億歐元的國防投資。這些努力包括歐洲安全行動或 SAFE 貸款機制，為國防準備籌集 1500 億歐元，包括飛彈防禦、無人機，當然還有網路安全。

Similarly, NATO members recently agreed to increase their defense and security spending to at least 5% of their GDP by 2035, more than doubling the previous long-standing target of 2% of GDP. Of the new 5% spending target, 1.5% is explicitly allocated to cybersecurity and security-related investments, including strengthening network defenses against cyberattacks.

同樣，北約成員國最近同意到2035年將國防和安全支出增加到GDP的至少5%，是先前長期目標GDP的2%的兩倍多。在新的 5% 支出目標中，1.5% 明確分配給網路安全和安全相關投資，包括加強網路防禦以抵禦網路攻擊。

The EU complements these efforts through initiatives to secure 5G networks and critical infrastructures, as well as a dedicated action plan for cybersecurity in vital services like hospitals and healthcare providers. This unprecedented increase in spending is deemed essential for deterring aggression and countering complex hybrid threats.

歐盟透過保護 5G 網路和關鍵基礎設施的舉措以及針對醫院和醫療保健提供者等重要服務的網路安全的專門行動計劃來補充這些努力。這一前所未有的支出成長被認為對於阻止侵略和應對複雜的混合威脅至關重要。

Outside the defense sector, we are particularly encouraged about overall growth opportunities in the EMEA regions of Europe, the Middle East, and Africa, where we have been seeing improved traction and a particular interest in our differentiated identity-bound biometric capabilities.

在國防部門之外，我們對歐洲、中東和非洲的 EMEA 地區的整體成長機會感到特別鼓舞，在這些地區，我們看到了越來越大的吸引力，人們對我們差異化的身份綁定生物識別功能特別感興趣。

We've refocused our efforts on BIO-key-branded solutions in those markets, following our transition away from the former licensed Swivel Secure solutions and services that we were selling in 2024 and previous to that.

在我們放棄 2024 年及之前銷售的授權 Swivel Secure 解決方案和服務之後，我們已將精力重新集中在這些市場的 BIO-key 品牌解決方案上。

Though it takes time to rebuild the opportunity pipeline and channel strategy to focus solely on the BIO-key product suite, we are seeing good traction and positive year-over-year revenue comparisons as we progress through the year.

儘管重建機會管道和通路策略以專注於 BIO-key 產品套件需要時間，但隨著時間的推移，我們看到了良好的牽引力和積極的同比收入比較。

From a margin perspective, our focus on BIO-key solutions provides us greater control and stronger gross margins, supporting our expectations for growth and enhanced margins from the EMEA group in the back half of 2025.

從利潤率的角度來看，我們對 BIO-key 解決方案的關注為我們提供了更大的控制權和更高的毛利率，支持了我們對 2025 年下半年 EMEA 集團成長和利潤率提高的預期。

Finally, across the business, we have been developing a new marketing program to better articulate our unique capabilities and compelling value proposition. Given the complexity and competition that exists in our space, we realized it was time to bring a new voice and focus to our core value proposition to better support our channel partners and direct sales efforts.

最後，在整個業務範圍內，我們一直在製定新的行銷計劃，以更好地表達我們獨特的能力和引人注​​目的價值主張。鑑於我們所在領域的複雜性和競爭性，我們意識到是時候為我們的核心價值主張帶來新的聲音和重點，以更好地支持我們的通路合作夥伴和直銷工作。

In North America, we continue to build on our strong position in higher ed, healthcare, and other public sector segments, as well as finance and insurance, benefiting from our growing base of reference accounts and IT professionals who have experienced firsthand the competitive strengths and value that we provide, in particular, with our biometrics.

在北美，我們繼續鞏固在高等教育、醫療保健和其他公共部門以及金融和保險領域的強勢地位，這得益於我們不斷增長的參考帳戶和 IT 專業人士群體，他們親身體驗了我們所提供的競爭優勢和價值，特別是我們的生物識別技術。

In addition, we are taking steps to revitalize our North American direct and channel sales efforts by recruiting new leadership and cultivating a more collaborative and competitive sales culture to drive improved results. We are also moving back to an in-office model for our sales, business development, and marketing teams once again, which is identical to the way we operated before the COVID pandemic.

此外，我們正在採取措施，透過招募新的領導層和培養更具協作性和競爭力的銷售文化來重振我們的北美直銷和通路銷售工作，以推動業績的改善。我們的銷售、業務開發和行銷團隊也將再次恢復辦公室模式，這與新冠​​疫情之前的營運方式完全相同。

In closing, we believe these strategic business development initiatives, coupled with our growing base of global channel partners, customers, and reference accounts, put BIO-key in a strong position to deliver improved top- and bottom-line results in 2025 and beyond.

最後，我們相信這些策略性業務發展舉措，加上我們不斷成長的全球通路合作夥伴、客戶和參考帳戶基礎，將使 BIO-key 處於有利地位，能夠在 2025 年及以後實現更好的頂線和底線業績。

We also continue to seek opportunities to reduce costs across the business to lower our breakeven level and support our path to positive cash flow and profitability. I'm excited about our potential over the coming quarters and appreciate the patience and support of our investors who have helped us get to this place.

我們也將繼續尋找機會降低整個業務的成本，以降低我們的損益平衡水平並支持我們實現正現金流和盈利。我對我們未來幾季的潛力感到興奮，並感謝幫助我們取得這項成就的投資者的耐心和支持。

Now I will pass the call to Ceci Welch to review BIO-key financials.

現在我將把電話轉給 Ceci Welch 來審查 BIO 關鍵財務狀況。

Thank you, Mike. Our results were released this morning via press release, and I will now talk about some of the highlights.

謝謝你，麥克。我們的成果已於今天上午透過新聞稿發布，現在我將講講其中的一些亮點。

Our Q2 '25 revenue increased 49% to $1.7 million versus $1.1 million in Q2 '24, with improvements in each segment. The most significant contributor was $458,000 increase in hardware revenue, principally due to additional deployments of finger biometric scanners for a large long-time customer.

我們的 2025 年第二季營收從 2024 年第二季的 110 萬美元成長 49%，達到 170 萬美元，各部門都有所改善。最重要的貢獻者是硬體收入增加了 458,000 美元，這主要是由於為一家長期大客戶額外部署了手指生物識別掃描儀。

License fee revenue increased 4% in Q2 '25, reflecting our growing base of -- sorry -- subscription contracts. Our service revenue increased 11%, largely to the benefit of customer service for a large customer upgrade. Q2 ' 25 gross profit increased by $354,000 or 40% to $1.2 million from $0.9 million in Q2 '24 due to the increase in total revenue, offset by a modest decline in gross margin to 73% in Q2 '25 versus 77% in Q2 '24.

2025 年第二季授權費收入成長了 4%，這反映了我們不斷成長的訂閱合約基礎。我們的服務收入成長了11%，這很大程度得益於大客戶升級帶來的客戶服務。由於總營收增加，2025 年第二季毛利從 2024 年第二季的 90 萬美元增加 35.4 萬美元（40%）至 120 萬美元，但毛利率從 2024 年第二季的 77% 小幅下降至 2025 年第二季的 73%。

The year-over-year margin decrease was the result of a large increase in hardware revenue as a percentage of sales in the current year period, as it carries a lower margin than license fees and services. BIO-key reduced operating expenses by approximately $217,000 or 8.5 % to $2.3 million in Q2 '25 versus $2.5 million in Q2 '24 due to a 13.5 % reduction in SG&A expenses, resulting from reductions in administrative, sales, personnel costs, and professional service fees.

利潤率年減的原因是本年度硬體收入佔銷售額的百分比大幅增加，因為其利潤率低於授權費和服務費。BIO-key 在 2025 年第二季將營運費用減少了約 217,000 美元（即 8.5%），至 2024 年第二季的 230 萬美元，而上年同期為 250 萬美元，原因是管理、銷售、人事成本和專業服務費的減少導致銷售、一般及行政費用減少了 13.5%。

As Mike mentioned, the SG&A improvement was partially offset by higher research and development costs in support of development of next-generation products, such as our PortalGuard upgrade and the exploration of new products and new product lines. Reflecting higher revenues and lower operating costs, BIO-key's Q2 '25 net loss improved to $1.2 million or $0.20 per share from a net loss of $1.7 million or $1 per share in Q2 '24.

正如 Mike 所提到的，銷售、一般及行政費用的改善部分被支援下一代產品開發（例如我們的 PortalGuard 升級以及新產品和新產品線的探索）的更高研發成本所抵消。由於營收增加和營運成本降低，BIO-key 2025 年第二季的淨虧損從 2024 年第二季的淨虧損 170 萬美元或每股 1 美元改善至 120 萬美元或每股 0.20 美元。

Our per share amounts are based on 5.8 million weighted average shares outstanding in Q2 '25 compared to 1.7 million in Q2 '24, principally related to the share issuances from the warrant exercise and other financing-related activities.

我們的每股金額是根據 25 年第二季 580 萬股加權平均流通股，而 24 年第二季為 170 萬股，主要與認股權證行使和其他融資相關活動產生的股票發行有關。

As of June 30, 2025, BIO-key had current assets of $4 million, including $2.3 million in cash, up from the current -- from the year-end current assets of $1.9 million, which included $438,000 of cash. Accounts receivable also increased 37% to $984,000 in June 2025 from $718,000 at year-end in 2024.

截至 2025 年 6 月 30 日，BIO-key 的流動資產為 400 萬美元，其中包括 230 萬美元的現金，高於目前的水平——年末流動資產為 190 萬美元，其中包括 438,000 美元的現金。應收帳款也從 2024 年底的 718,000 美元增加 37% 至 2025 年 6 月的 984,000 美元。

And now operator, at this time, please prepare for Q&A session.

現在接線員，請準備問答環節。

(Operator Instructions) [Dan Thomas], Private Investor.

（操作員指示）[Dan Thomas]，私人投資者。

With the increased cost for this, I guess, sales and support team on the cyber defense and increased R&D, should we expect the recent trend towards reduced operating expenses to reverse?

我猜，隨著網路防禦銷售和支援團隊成本的增加以及研發費用的增加，我們是否應該預期最近降低營運費用的趨勢會逆轉？

No. Well, again, I want to answer that question the right way, Dan. By the way, good morning. So no, the answer to that question is, we had a -- I'll call it a blip in the second quarter due to a few things.

不。好吧，丹，我再次想以正確的方式回答這個問題。順便說一下，早安。所以，不，這個問題的答案是，我們在第二季度遇到了——由於一些原因，我稱之為短暫的波動。

Number one, some restructuring in sales. I mentioned in my prepared remarks we were doing some changes in leadership and sales and business development resourcing. So that's number one.

第一，對銷售進行一些重組。我在準備好的演講中提到，我們正在對領導階層、銷售和業務發展資源進行一些調整。這是第一點。

Number two, events, and that's just the timing. We attend a couple of core events each year. One of them is Gartner. One is Identiverse; ISC2, we attend that event as well. And so the timing of and the payment, right, for those events is one element.

第二，事件，也就是時機。我們每年都會參加一些核心活動。其中之一就是 Gartner。一個是Identiverse；ISC2，我們也參加了那個活動。因此，這些活動的時間和付款是一個因素。

And I think we believe that the expense run rate that we started the year at from -- will pretty much be the way we proceed through the third and fourth quarter. So again, it was about a $300,000 blip in Q2.

我認為，我們相信，我們今年年初的費用運行率將基本決定我們第三季和第四季的運作方式。所以，第二季的損失約為 30 萬美元。

Okay. Can you give us any at all additional color on what meaningful contract activity in the first half of next year means -- cybersecurity in Europe?

好的。您能否向我們進一步說明明年上半年有意義的合約活動對歐洲網路安全意味著什麼？

Yes, it's pretty significant. I think our challenge -- in fact, we have contracts that we've closed already this quarter and late last quarter and this quarter that we really just can't discuss. It's a very robust market in particular for us for our very specific solutions.

是的，這非常重要。我認為我們面臨的挑戰是——事實上，我們本季和上季末已經完成了一些合同，但本季度我們真的無法討論這些合約。對我們來說，這是一個非常強勁的市場，尤其對於我們非常具體的解決方案。

So we provide not only an MFA, but an identity and access management platform with PortalGuard. And we're pretty much the only vendor that has a solid, proven biometric attachment to ratchet up the level of security for access management for these defense contractors and ultimately, the end-use defense agencies. And so because of our powerful references, that business is going to grow for us.

因此，我們不僅提供 MFA，還提供帶有 PortalGuard 的身份和存取管理平台。我們幾乎是唯一一家擁有可靠、成熟的生物識別附件的供應商，可以提高這些國防承包商以及最終使用國防機構的存取管理安全等級。因此，由於我們強大的參考價值，我們的業務將會成長。

And so, we announced the formal initiative -- I mean, we've been working this for the past year. But we announced the formal initiative this morning to go after that business in a bigger way. And we'll be doing some marketing and some other things to ensure that all of the contractors and the end-use agencies know about BIO-key. Because many of these large contracts are hosted and managed by large primes, right?

因此，我們宣布了正式的舉措——我的意思是，我們過去一年一直在努力實現這一目標。但我們今天上午宣布了正式舉措，將更大規模地開展這項業務。我們將進行一些行銷和其他工作，以確保所有承包商和最終使用機構了解 BIO-key。因為許多大型合約都是由大型公司託管和管理的，對嗎？

And on an international basis, we know who all of them are. We have very good partner relationships already in EMEA. And this is just making it more significant for us. It's no secret, right, that the US has forced the EU and the Middle East to step up and spend more to defend themselves and to also acquire product, missiles, weapons, all kinds of drones and other technology from the US as well.

從國際層面來看，我們知道他們是誰。我們在歐洲、中東和非洲地區已經建立了非常好的合作關係。這對我們來說就更加重要了。這不是什麼秘密，美國迫使歐盟和中東加強並投入更多資金進行自衛，並從美國購買產品、飛彈、武器、各種無人機和其他技術。

So there's no doubt that the money is there. There's no doubt that the need is there. And with our references, in particular, with some very high-level agencies that we haven't even discussed or announced and we can't yet, we think we're in a really good position to capture that.

因此毫無疑問，錢是存在的。毫無疑問，這種需求是存在的。透過我們的參考，特別是與一些我們尚未討論或宣布的高層機構的合作，我們認為我們處於非常有利的位置來抓住這一機會。

And that's again on the government side, but we also have a very robust enterprise business. I mean, look at our business in banking and in healthcare, in education. We have well over 100 customers that represent millions and millions of users every day that use our technology.

這又是政府方面的業務，但我們也擁有非常強勁的企業業務。我的意思是，看看我們在銀行業、醫療保健業和教育業的業務。我們擁有超過 100 個客戶，代表每天使用我們技術的數百萬用戶。

So I don't want anyone to think that we're moving away in any way, shape, or form from the enterprise business. But I think what we're trying to say here is we're going to take advantage of the thermals that exist now because of this increase in the defense and intelligence markets that's recently evolved.

所以我不希望任何人認為我們正在以任何方式、形式脫離企業業務。但我認為我們在這裡想說的是，由於國防和情報市場最近不斷發展，我們將利用現有的熱能。

Okay. When you say you have contracts that you can't mention or -- I'm just wondering, have you received the income from those contracts already in the second quarter? Or are those contracts scheduled to come in, in the first half of next year or something? I'm just trying to get a feel for how (multiple speakers) --

好的。當您說您有不能提及的合約時——我只是想知道，您是否已經在第二季收到了這些合約的收入？或是這些合約預計在明年上半年或什麼時候簽訂？我只是想了解一下（多位發言者）——

No, both. I was very clear. I mentioned we have already contracts that we've, again, closed at the end of last quarter -- this quarter in Q3. And they'll be reflected in the Q3 results, right? I mean, unfortunately, again, we can't really announce the names or any of that at this point. At some point, perhaps, we will be able to do that. But at this point, we can't.

不，兩者都有。我很清楚。我提到過，我們已經簽訂了合同，這些合約是在上個季度末（也就是第三季）完成的。這些都會反映在第三季的業績中，對嗎？我的意思是，不幸的是，我們現在無法真正宣布名字或任何相關資訊。或許，在某個時候，我們就能做到這一點。但目前我們還不能。

And so I think even in Q2, the -- certainly, at least I look at the stock price, and I don't think it's reflective of our performance today. And I think that the market just yet at this point doesn't realize, again, our opportunity.

因此我認為即使在第二季度，至少我會看一下股價，我認為它並不能反映我們今天的表現。我認為目前市場還沒有意識到我們的機會。

And unfortunately, it's going to happen -- it's going to be shown in the results because a lot of the things that we are involved in right now are just not announceable. It's just the way it is. And I don't think we're the only company in this position. But certainly for us right now, that's our situation.

不幸的是，這將會發生——它將在結果中顯示出來，因為我們現在參與的許多事情都是無法宣布的。事情就是這樣。我認為我們不是唯一一家處於這種境地的公司。但對我們來說，現在的情況確實如此。

Okay. But you're saying that these things you haven't announced that they'll be providing income in the next year. And that's some of what you're basing this idea of meaningful contract activity? Or are you just expecting that because of the increased market in Europe and EMEA? That's what I'm saying.

好的。但您說這些事情您還沒有宣布它們將在明年帶來收入。這就是您所提出的有意義的合約活動的想法的基礎嗎？或者您只是因為歐洲和 EMEA 市場的成長才有這樣的預期？這就是我要說的。

No, no, no. This isn't a pipe dream. There will be results this quarter from some of these contracts in Q3. This is Q3. We're in Q3 and Q4 and obviously beyond. But these are real contracts that have generated revenue already and will continue to generate revenue through the end of this year and into next year and beyond, right?

不，不，不。這並不是白日夢。其中一些合約將於本季第三季公佈結果。這是第三季。我們正處於第三和第四季度，顯然還會進一步發展。但這些都是真正的合同，已經產生了收入，並且將在今年年底、明年甚至更久以後繼續產生收入，對嗎？

Obviously, these are -- these spending initiatives that are -- in particular, in the EU and in the Middle East are multiyear, right? These are not just one-time kind of blips. These are investments that are going to go on for five-plus years, maybe even longer.

顯然，這些支出計劃，特別是在歐盟和中東地區，都是多年的，對吧？這些並不是一次性的曇花一現。這些投資將持續五年以上，甚至更長。

Okay. Do you expect these to ramp, I guess? I guess, I'm trying to understand will -- I mean, we've lost $1 million, I think, in this quarter. So these have to ramp for you to get to breakeven. So are you expecting like a growth -- significant growth from these in the first half? Is that what's going on?

好的。我猜你希望這些會增加嗎？我想，我試圖理解——我的意思是，我認為我們在本季度損失了 100 萬美元。因此，你必須加大這些投入才能達到收支平衡。那麼，您是否預計上半年會出現顯著的成長？真是這樣嗎？

Absolutely. There's no question. I mean, again, it's iterative, right? These things will grow. The quantity of opportunities, customers will grow, as well the size. And typically, these things start and then they iterate.

絕對地。毫無疑問。我的意思是，它是迭代的，對嗎？這些東西將會成長。機會、客戶的數量將會成長，規模也會擴大。通常，這些事情開始後就會不斷重複。

If you look at that -- our first, our largest defense ministry, right, we've iterated to multimillion dollar to multiple millions of dollars in sales, both hardware and software, with them over the last few years. And so these are the things that continue, right?

如果你看一下——我們的第一個、也是我們最大的國防部，在過去幾年裡，我們與他們的硬體和軟體銷售額已經達到了數百萬美元。所以這些事情還會繼續下去，對嗎？

There -- they start, and then they iterate. They get bigger. More users get added, more touch points get added, i.e., that represents hardware. But one other point that I want to make, our blended gross margins still are 70%-plus, which is very, very strong.

他們從那裡開始，然後進行迭代。它們變得更大了。增加更多的用戶，增加更多的接觸點，也就是增加硬體。但我想指出的另一點是，我們的混合毛利率仍然在 70% 以上，這是非常非常強勁的。

They float, right, between 70% and 80%. But at the end of the day, those are very, very strong and powerful gross margins and, I think, a testament to the quality and the nature of our solution set. Customers want one throat to choke. They want to be able to buy everything from us and know that we're there to support everything. So again, that's also very powerful for us.

它們浮動在 70% 到 80% 之間。但最終，這些都是非常非常強勁和強大的毛利率，我認為這證明了我們的解決方案的品質和性質。顧客想要一個喉嚨被掐住。他們希望能夠從我們這裡購買所有產品，並且知道我們會為他們提供支援。所以，這對我們來說也非常有力。

Okay. You mentioned some of this has happened in the third quarter. I think last call, you mentioned that during the summer, I guess, Europe shuts down in August and whatnot. Do we have a feel at all for whether we'll get growth in the third quarter or whether we might see a little bit of a slowdown before a ramp back up in the fourth quarter? Anything like that?

好的。您提到其中一些情況在第三季已經發生。我認為最後一次，你提到在夏天，我想，歐洲會在八月關閉等等。我們是否能感覺到第三季經濟是否會成長，或者在第四季回升之前是否會略微放緩？有類似的事情嗎？

Yeah. Well, we don't provide guidance, so I'm not going there. But there's no question that Europe right now, right -- we're in the dead portion of the summer in Europe. And that will continue through the end of the month, but in September, things will wake back up again. So we're encouraged by our pipeline and the number of opportunities we have.

是的。嗯，我們不提供指導，所以我不會去那裡。但毫無疑問，現在歐洲正處於夏季的冷季。這種情況將持續到月底，但到了九月份，一切將再次復甦。因此，我們對我們的管道和所擁有的機會數量感到鼓舞。

And in the context of also on this kind of defense intelligence segment, it's typically a priority. So it's less impacted by the, I'll call it, the malaise that you see typically in the European summer because these things are mission-critical, right?

在這種國防情報領域中，這通常是優先事項。因此，它受到的影響較小，我稱之為歐洲夏季通常出現的萎靡不振，因為這些事情對於任務至關重要，對嗎？

So they may obviously have less staff or a diminished focus. But the focus doesn't go away as it will -- sometimes, you'll see that in the enterprise or commercial markets in Europe. But you'll see less of that in the defense and intelligence sectors.

因此，他們顯然會減少員工數量或降低關注度。但焦點不會消失——有時，你會在歐洲的企業或商業市場上看到這種情況。但在國防和情報領域，這種情況就比較少見了。

Okay. That's helpful. How much of the reserve inventory did you sell? Can you give us that?

好的。這很有幫助。您銷售了多少儲備庫存？你能給我們嗎？

Yeah. We're selling it basically every quarter. We sold a bunch already this quarter in Q3. We continue to move that inventory. And our goal and objective is to, again, by the end of the year to have moved the bulk of it.

是的。我們基本上每個季度都會銷售它。我們第三季已經賣了很多。我們繼續轉移庫存。我們的目標和目的是，在今年年底前再次完成大部分工作。

So I keep mentioning -- and I've mentioned this on a number of calls -- that we have a few larger opportunities to move higher volumes of those units. And that's starting to come to pass for us. So you'll see that reflected in the numbers as we evolve forward. And of course, as you know, they've all been written down. So it's all -- it's revenue, and it's also all cash. So it's good for us -- and all margin.

因此，我一直在提到——而且我在許多電話會議上都提到過這一點——我們有一些更大的機會來增加這些單位的銷售量。而這對我們來說已經開始實現。因此，隨著我們不斷進步，您會看到這一點在數字上得到體現。當然，正如你所知，它們都已被記錄下來。所以這都是收入，而且都是現金。所以這對我們以及所有利潤來說都是好事。

Right. But can you tell us how much you have left?

正確的。但是你能告訴我們你還剩多少錢嗎？

No.

不。

Do these hardware sales lead or lag software sales? I noticed a big increase (multiple speakers) --

這些硬體銷售是否領先或落後於軟體銷售？我注意到有很大的增長（多位發言者）——

They usually come together. So typically, the initial contract or sale will include software and the hardware to get the solution up going, users registered, deployed. And then the expansion will typically include software and maybe some hardware. So there might be less; there might be more.

他們通常會一起來。因此，通常情況下，初始合約或銷售將包括軟體和硬件，以啟動解決方案、用戶註冊和部署。然後擴展通常會包括軟體和一些硬體。所以可能會少一些，也可能會多一些。

In the context of our large defense ministry customer, they've deployed, I believe, 40,000 touch points, meaning they've deployed 40,000 finger scanners in different locations throughout their infrastructure. And they continue now to add users, right?

就我們大型國防部客戶而言，我相信他們已經部署了 40,000 個接觸點，這意味著他們在其基礎設施的不同位置部署了 40,000 個指紋掃描器。他們現在還在持續增加用戶，對嗎？

More and more larger portions of their population are now getting enrolled because they have a wide distribution of touch points. and they fundamentally have mandated that anyone who accesses anything that has to do with their intelligence infrastructure must utilize the BIO-key solution. And every one of those touch points has a BIO-key logo on it, just FYI.

由於他們的接觸點分佈廣泛，越來越多的人口正在登記。他們從根本上要求任何訪問與其情報基礎設施有關的東西的人都必須使用 BIO-key 解決方案。每個接觸點上都有一個 BIO-key 標誌，僅供參考。

Can you give us any update on Nigeria or Africa? That's still --

您能向我們介紹一下尼日利亞或非洲的最新情況嗎？那仍然是--

We still operate there, and we're -- we really have turned our focus to supporting our core products right now. We have a number of partners that we've signed up through our EMEA group in Africa, that will be representing us, but more for our core technology and core products.

我們仍然在那裡運營，而且我們現在確實已經將重點轉向支持我們的核心產品。我們透過位於非​​洲的 EMEA 集團簽署了許多合作夥伴，他們將代表我們，但更多是代表我們的核心技術和核心產品。

The volatility on the other side of the market -- I'll call it the civil ID market -- it's just not worth our effort at this point. We do believe, though, in Africa as an emerging market, but more on the -- as you see, we closed two banking deals in Africa in the first half, right, the Bank of Mozambique and Egypt.

市場另一端的波動——我稱之為民用身分證市場——目前不值得我們付出努力。不過，我們確實相信非洲是一個新興市場，但更重要的是──正如你所看到的，我們上半年在非洲完成了兩筆銀行交易，分別是莫三比克銀行和埃及銀行。

We have another one in the pipeline that we hope will close this quarter or next. So going after the commercial enterprise market, in particular, with our biometric solutions seems like a very powerful opportunity. So that's our focus right now in greater Africa.

我們還有另一個計劃正在籌備中，希望能在本季或下個季度完成。因此，利用我們的生物辨識解決方案進入商業企業市場似乎是一個非常強大的機會。這就是我們目前在大非洲地區的重點。

Last question, do you think you have enough cash and equivalents to get you through the end of year?

最後一個問題，您認為您有足夠的現金和等價物來度過年底嗎？

Yes, we do.

是的，我們有。

Okay. I'll get back in the queue. Thank you for the time.

好的。我會回到隊列中。感謝您抽出時間。

Thanks, Dan.

謝謝，丹。

(Operator Instructions) There are no further questions at this time. I'd like to turn the call back over for any closing remarks.

（操作員指示）目前沒有其他問題。我想把電話轉回去做最後的總結發言。

Thank you, everyone, for taking the time with us today. You may reach out to our IR team, whose contact information is in today's press release, with any follow-up questions.

謝謝大家今天抽空與我們一起接受訪問。如有任何後續問題，您可以聯絡我們的 IR 團隊，其聯絡資訊在今天的新聞稿中。

Also, we expect to participate in a number of conferences as we evolve forward through the end of the year and stay tuned for those announcements. We certainly we'll keep you posted.

此外，隨著我們在今年年底前不斷發展，我們預計將參加一系列會議，請繼續關注這些公告。我們一定會及時向你通報最新情況。

With that, have a great day, a great rest of the week, and a great rest of the summer. We look forward to updating you on our call in the late fall, in the mid-fall, in October. Have a great day.

祝您有個愉快的一天、愉快的一週以及愉快的夏天。我們期待在深秋、仲秋和十月份的電話會議上向您通報最新情況。祝你有美好的一天。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。