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AudioEye Inc (AEYE)
NASDAQ:AEYE
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AudioEye
(NASDAQ:AEYE)
56Neutral
Positive Factors
Financial Performance
AudioEye reported strong Q4 results, with ARR up 17.3% as the macro remains challenging for software sales offset by some regulatory and execution tailwinds.
Market Position
AudioEye is viewed as the market leading platform for managing digital accessibility.
Strategic Initiatives
The company’s Board of Directors has authorized a repurchase of up to $12.5M of common stock, indicating confidence in its current valuation levels.
Negative Factors
Economic Environment
Management issued FY25 guidance, which is believed to be conservative and reflects ongoing macro challenges including incremental conservatism for a weakening economy.
Investor Sentiment
Investor appetites have shifted in recent months, causing a reduction in the price target from $37 to $22.
Regulatory Challenges
Accessibility is now separated from DEI policies following the February 5th statement by the Office of Personnel Management.
AudioEye (AEYE) vs. S&P 500 (SPY)
Market Cap
$143.24M
Dividend YieldN/A
Average Volume (3M)192.18K
Price to Earnings (P/E)―
Beta (1Y)3.12
Revenue Growth12.41%
EPS Growth28.88%
CountryUS
Employees117
SectorTechnology
Sector Strength46
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.36
Shares Outstanding12,412,544
10 Day Avg. Volume260,842
30 Day Avg. Volume192,180
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)4.02
Price to Cash Flow (P/CF)62.60
P/FCF Ratio259.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$26.40Price Target Upside134.46% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
AudioEye Business Overview & Revenue Model
Company DescriptionAudioEye, Inc. (AEYE) is a technology company that specializes in digital accessibility solutions. The company operates in the technology and software sectors, offering products and services designed to make digital content more accessible to individuals with disabilities. AudioEye's core offerings include its proprietary digital accessibility platform that automates and simplifies the process of making websites and digital content compliant with various accessibility standards, such as the Americans with Disabilities Act (ADA) and the Web Content Accessibility Guidelines (WCAG).
How the Company Makes MoneyAudioEye generates revenue primarily through subscription-based services for its digital accessibility platform. The company offers different tiers of service plans that cater to businesses of various sizes, ranging from small businesses to large enterprises. These subscription plans provide clients with tools and technologies to ensure their digital content is accessible and compliant with legal and regulatory standards. Additionally, AudioEye offers professional services, including accessibility audits, training, and consulting, which provide additional revenue streams. Significant partnerships with web development agencies and content management systems also contribute to the company's earnings by expanding its market reach and integrating its solutions into broader digital ecosystems.
AudioEye Financial Statement Overview
Summary
AudioEye's financial performance shows positive revenue growth and strong gross profit margins. However, the company continues to face profitability challenges with negative EBIT and net profit margins. The balance sheet highlights a low debt-to-equity ratio but increasing reliance on liabilities, while the cash flow shows improvement with positive free cash flow. Overall, the company is on a growth trajectory, but achieving sustainable profitability remains a critical focus.Income Statement
AudioEye has demonstrated a positive revenue growth trajectory, increasing from $20.5 million in 2020 to $35.2 million in 2024. The gross profit margin has remained strong, hovering around 79% in 2024. However, the company is still facing challenges with profitability as indicated by negative EBIT and net profit margins. Despite narrowing net losses, the company needs to further improve operational efficiency to achieve profitability.60
Neutral
Balance Sheet
The company maintains a relatively low debt-to-equity ratio, which indicates a conservative use of leverage. However, the equity ratio has been declining, suggesting increased reliance on liabilities. Stockholders' equity has shown improvement, rising to $9.4 million in 2024, but overall asset growth needs to be sustained to enhance financial stability.55
Neutral
Cash Flow
There has been a significant improvement in free cash flow, moving from negative values in prior years to a positive $2.7 million in 2024. The operating cash flow to net income ratio indicates a stronger cash conversion cycle. Continued positive cash flow from operations is essential to support growth initiatives and reduce reliance on external financing.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 35.20M | 31.32M | 29.91M | 24.50M | 20.48M | Gross Profit |
| 27.94M | 24.34M | 22.69M | 18.38M | 14.51M | EBIT |
| -3.39M | -5.96M | -10.43M | -15.51M | -7.13M | EBITDA |
| -3.39M | -3.25M | -7.76M | -12.61M | -5.84M | Net Income Common Stockholders |
| -4.25M | -5.87M | -10.44M | -12.63M | -6.13M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 5.65M | 9.24M | 6.90M | 18.97M | 9.10M | Total Assets |
| 29.77M | 25.50M | 24.43M | 29.31M | 18.25M | Total Debt |
| 417.00K | 7.46M | 1.26M | 967.00K | 2.02M | Net Debt |
| -5.23M | -1.77M | -5.65M | -18.00M | -7.08M | Total Liabilities |
| 20.33M | 18.79M | 13.84M | 11.72M | 10.62M | Stockholders Equity |
| 9.44M | 6.71M | 10.59M | 17.60M | 7.63M |
| Cash Flow | Free Cash Flow | |||
| 790.00K | -1.84M | -6.25M | -6.55M | -3.20M | Operating Cash Flow |
| 2.73M | 318.00K | -5.00M | -4.98M | -1.91M | Investing Cash Flow |
| -7.21M | -2.16M | -5.73M | -1.62M | -1.30M | Financing Cash Flow |
| 898.00K | 4.17M | -1.33M | 16.48M | 10.33M |
AudioEye Technical Analysis
Negative
11.26
Price Trends
15.25
Negative
18.31
Negative
20.11
Negative
Market Momentum
-0.99
Negative
40.35
Neutral
43.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AEYE, the sentiment is Negative. The current price of 11.26 is below the 20-day moving average (MA) of 11.96, below the 50-day MA of 15.25, and below the 200-day MA of 20.11, indicating a bearish trend. The MACD of -0.99 indicates Negative momentum. The RSI at 40.35 is Neutral, neither overbought nor oversold. The STOCH value of 43.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AEYE.
AudioEye Risk Analysis
AudioEye disclosed 42 risk factors in its most recent earnings report. AudioEye reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
AudioEye Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $172.28B | 26.09 | 47.28% | ― | 10.65% | 44.84% | |
73 Outperform | $14.67B | 30.78 | 21.59% | ― | 19.81% | 139.58% | |
58 Neutral | $21.67B | 10.60 | -18.43% | 2.42% | 4.66% | -24.45% | |
56 Neutral | $143.24M | ― | -52.70% | ― | 12.41% | 28.88% | |
56 Neutral | $16.71M | ― | -19.27% | ― | -1.05% | 80.22% | |
52 Neutral | $626.28M | ― | -42.46% | ― | -10.12% | 72.31% | |
50 Neutral | C$3.36B | ― | -13.55% | ― | -26.72% | 77.64% |
* Technology Sector Average
Performance Comparison
AEYE
AudioEye
11.26
1.63
16.93%
ADBE
Adobe
396.15
-105.94
-21.10%
BLIN
Bridgeline Digital
1.46
0.30
25.86%
TSE:BB
BlackBerry
5.63
1.95
52.99%
DT
Dynatrace
49.02
3.28
7.17%
THRY
Thryv Holdings
14.44
-8.12
-35.99%
AudioEye Earnings Call Summary
Earnings Call Date: Mar 12, 2025 | % Change Since: -11.41% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with record revenue growth, improved margins, and strong performance in key channels. The company is expanding into the European market and has increased its AI capabilities, indicating future growth potential. However, increased operating expenses and ongoing net losses were noted as challenges.Highlights
Record Revenue and Improved Margins
Q4 2024 revenue reached a record $9.7 million, a 24% increase year-over-year, and gross margins improved to 80%. Adjusted EBITDA margins also reached a record 24%.
Strong Full-Year Financial Performance
Full year 2024 revenues grew 12% to $35.2 million, with gross profit increasing to $27.9 million. Adjusted EBITDA for the full year was $6.7 million, a significant increase from 2023.
Growth in Enterprise and Partner Channels
Enterprise channel contributed 42% of ARR, while the partner and marketplace channel grew 14% year-over-year, representing approximately 58% of ARR.
Expansion into European Market
Preparation for the European Accessibility Act with a team in Europe. Anticipation of growth similar to GDPR rollout, with a potential acceleration in the second half of 2025.
Improved AI Capabilities
Significant increase in AI automated detection capabilities, automatically detecting 500% more issues than other solutions.
Share Repurchase Program
Authorization of a $12.5 million share repurchase program through January 2027 as a strategy to deploy excess capital.
Lowlights
Increased Operating Expenses
Operating expenses increased by $2.4 million in Q4 2024, driven by non-recurring items such as additional stock compensation and litigation expenses.
Net Losses Despite Revenue Growth
Q4 2024 net loss was $1.5 million, and full-year net loss was $4.3 million, although this was an improvement from the previous year.
Company Guidance
During AudioEye's Fourth Quarter and Full Year 2024 Earnings Conference Call, the company provided detailed guidance for 2025, projecting revenue growth between $41 million and $42 million, representing an 18% increase at the midpoint. They anticipate adjusted EBITDA to range from $9 million to $10 million, which signifies a 41% growth at the midpoint. For the first quarter of 2025, revenue is expected to be between $9.7 million and $9.8 million, with adjusted EBITDA projected to be between $1.85 million and $1.95 million and adjusted EPS between $0.14 and $0.16 per share. For the full year, adjusted EPS is expected to be between $0.70 and $0.80 per share. The company also anticipates continued adherence to the Rule of 40, reflecting their commitment to balancing growth and profitability. The CEO, David Moradi, highlighted significant improvements in financial metrics, with Q4 2024 gross margins reaching 80% and adjusted EBITDA margins hitting a record 24%. Revenue per employee also increased to over $330,000 in the fourth quarter.AudioEye Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
AudioEye Appoints James B. Hawkins to Board
Positive
Mar 4, 2025
On March 3, 2025, Anthony Coelho resigned from AudioEye’s Board of Directors, and James B. Hawkins was appointed as his successor. Hawkins, a seasoned executive with a history of driving growth at Natus Medical, is expected to bring valuable experience to AudioEye as it continues to expand its reach and impact in the digital accessibility sector. His appointment reflects AudioEye’s strategic focus on scaling operations and enhancing its market position.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.