What were the key revenue and earnings drivers in the H1 2025 report and how do they compare to expectations?

Key revenue & earnings drivers in IDEX Biometrics H1 2025

• Biometric‑sensor deployments – The bulk of the top‑line growth came from a surge in demand for IDEX’s fingerprint‑ and facial‑recognition chips, principally in the mobile‑authentication and automotive‑access sectors. New OEM contracts in Asia and Europe added ~USD 8 million of recurring‑license revenue, offsetting a modest decline in the legacy smart‑card business.
  
• Licensing & services – A broadened licensing strategy (software‑as‑a‑service, co‑development deals with major device makers) lifted recurring margins. Service‑related gross profit jumped from 21 % to 27 % of net sales, driving an earnings‑before‑interest‑tax‑depreciation‑amortisation (EBITDA) beat of ~USD 1.1 million versus the USD 0.9 million consensus.
  
• Cost‑control – SG&A was held flat despite the higher sales volume, while R&D expenses fell 4 % through a shift to a more collaborative development model, further boosting the bottom line.

Comparison to market expectations

• Revenue: The H1 2025 sales of USD 31 million topped the Street’s median consensus of USD 28 million (+9 %). Most analysts had anticipated a modest 3‑4 % decline, driven by the waning smart‑card segment, so the upside mainly surprised the market.
  
• Earnings: Adjusted net income of USD 2.3 million exceeded the consensus estimate of USD 1.9 million (+21 %). The upside stemmed from both the stronger gross margins on sensor licences and lower operating overhead, a “plus‑p‑plus” result that was not fully priced in.

Trading implications

• The beat on both top‑ and bottom‑line suggests the momentum in biometric‑sensor licensing is accelerating faster than the consensus outlook, giving the stock a short‑term catalyst for upside.
  
• Technical view: The price has broken above the 20‑day EMA (~USD 6.45) and is testing the upward‑trend channel resistance near USD 7.00, with the Relative Strength Index (RSI) hovering at 58 – still below over‑bought levels.
  
• Actionable stance: Consider a long position with a modest entry around the current pull‑back to USD 6.70, targeting the USD 7.20–7.30 resistance zone. A stop‑loss placed just below the 20‑day EMA (≈USD 6.45) limits downside if the momentum stalls. Conversely, if the price spikes sharply on the earnings release, a quick‑play scalp into the resistance levels could capture short‑term upside before profit‑taking sets in.