Mitek Systems Inc (NASDAQ:MITK), a digital identity verification and fraud prevention company, stock rose 13.64% (As on December 12, 11:31:35 AM UTC-4, Source: Google Finance) after the company reported fourth-quarter results that exceeded analyst expectations and providing robust guidance for fiscal 2026. Mitek’s SaaS revenue was particularly strong, growing 19% YoY to $21.3 million compared to $18.0 million in the same quarter last year. Mitek’s adjusted EBITDA margin for the fourth quarter was 28.7%, compared to 35.7% in the same period last year. Free cash flow was $19.2 million for the quarter, slightly down from $20.8 million a year ago. The company ended the fiscal year with $196.5 million in cash and investments, an increase of $54.7 million from the previous year. The company reported Non-GAAP gross profit of $37.6 million, compared to $37.2 million a year ago. Non-GAAP gross profit margin was 84.0%, compared to 86.0% a year ago. Adjusted EBITDA was $12.9 million, compared to $15.4 million a year ago. The company delivered Non-GAAP net income of $11.1 million, compared to $15.5 million a year ago.

MITK in the fourth quarter of FY25 has reported the adjusted earnings per share of $0.24, beating the analysts’ estimates for the adjusted earnings per share of $0.17. The company had reported the adjusted revenue growth of 4 percent to $44.8 million in the fourth quarter of FY25, beating the analysts’ estimates for revenue of $42.5 million. Fraud and identity now account for over half of the total business, growing more than 15% year over year, establishing it as a growth engine for revenue and SaaS expansion. The Check Fraud Defender consortium expanded to cover over a quarter of all US checking accounts, with ACV growing 50% year over year. Check verification revenue declined from $94 million in fiscal 2024 to $90 million in fiscal 2025, primarily due to deal timing. Check Fraud Defender ACV for the year came in below initial goals due to the timing of large enterprise deployments.

For fiscal 2026, Mitek forecasts revenue between $185 million and $195 million, well above the analyst consensus of $175.8 million. The midpoint of this guidance represents approximately 5.5% growth over fiscal 2025. The company expects its Fraud & Identity solutions revenue to grow approximately 15% to between $101 million and $105 million. There is an expected modest gross margin pressure in fiscal 2026 due to a mix shift towards SaaS and services.