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Autoscope Technologies Corporation Announces Financial Results and Dividend Declaration

1. AATC's net income decreased by 50% to $0.8 million in Q2 2025. 2. Royalties fell 24%, affecting anticipated cash flow and revenue. 3. Quarterly cash dividend of $0.15 per share authorized for August 2025. 4. Operating expenses remained unchanged from last year despite declining revenues. 5. The transition to Autoscope OptiVu may impact sales in the near future.

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FAQ

Why Bearish?

A significant decrease in royalties and net income indicates financial strain, reminiscent of past struggles during product transitions.

How important is it?

Given the financial declines, investors may perceive greater risks, affecting stock performance.

Why Short Term?

Immediate effects from declining revenues and operating stability may influence investor sentiment soon, as cash flow challenges persist.

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ISNSEconolite Control Products, Inc.
MINNEAPOLIS, Aug. 07, 2025 (GLOBE NEWSWIRE) -- Autoscope Technologies Corporation (OTCQX: AATC) today announced results for its quarter and six months ended June 30, 2025. Net income for the quarter ended June 30, 2025 was $0.14 per basic and diluted share. Net income for the six months ended June 30, 2025 was $0.21 per basic and diluted share. The Board of Directors has authorized and declared a quarterly cash dividend of $0.15 per share of its common stock. The dividend is payable on August 25, 2025 to the shareholders of record at the close of business on August 18, 2025. Second Quarter 2025 Financial Summary Royalties decreased 24 percent to $2.8 million in the second quarter of 2025 compared to $3.7 million in the same period in the prior year.Operating expenses were $1.7 million in the second quarter of 2025, unchanged from $1.7 million in the same period in the prior year.  Net income decreased 50 percent to $0.8 million in the second quarter of 2025 compared to $1.5 million in the same period in the prior year.The cash balance increased to $2.4 million at June 30, 2025 compared to a cash balance of $609,000 at the end of the first quarter of 2025. First Half 2025 Financial Summary Royalties decreased 28 percent in the first six months of 2025 to $4.9 million compared to $6.8 million in the same period in the prior year.Operating expenses decreased 5 percent to $3.4 million in the first six months of 2025 compared to $3.6 million in the same period in the prior year.  Net income decreased 53 percent to $1.1 million in the first six months of 2025 compared to $2.4 million for the same period in the prior year.The cash balance decreased to $2.4 million at June 30, 2025 compared to a cash balance of $4.4 million at December 31, 2024. Second-Quarter Results Revenue from operations for Autoscope Technologies Corporation (“AATC” or the “Company”), which includes the results of Image Sensing Systems, Inc., a wholly owned subsidiary of AATC (“ISNS”), was $2.9 million in the second quarter of 2025, a 24 percent decrease from $3.8 million in the same period of 2024. Revenue from royalties was $2.8 million in the second quarter of 2025, a 24 percent decrease from $3.7 million in the second quarter of 2024. Product sales were $31,000 in the second quarter of 2025, a 56 percent decrease from $71,000 in the second quarter of 2024. Gross margin for the second quarter of 2025 was 98 percent, a 3-percentage point increase from a gross margin of 95 percent for the same period in 2024. Royalty gross margin for the second quarter of 2025 was 100 percent compared to 97 percent in the same period in 2024. As a percentage of revenue, product sales gross margins decreased to a negative 61 percent in the second quarter of 2025 compared to a negative 1 percent gross profit margin in the second quarter of 2024. Operating expenses were $1.7 million in the second quarter of 2025, unchanged from $1.7 million in the same period of 2024. The Company recognized a tax expense of $344,000 in the second quarter of 2025, compared to a tax expense of $406,000 in the prior year period. The tax expense in the second quarter of 2025 was lower compared to the second quarter of 2024 due to lower pre-tax income from operations, partially offset by a deferred tax asset write-off of $119,000 relating to the pending dissolution of our Canadian entity. The Company reported net income for the second quarter of 2025 of $0.8 million, or $0.14 per basic and diluted share, compared to a net income of $1.5 million, or $0.28 per basic and diluted share, in the prior year period. Year-to-Date Results AATC’s revenue for the first six months of 2025 was $5.0 million, a 27 percent decrease from revenue of $6.9 million in the first six months of 2024. Revenue from royalties decreased 28 percent to $4.9 million in the first six months of 2025 compared to $6.8 million in the same period in 2024. Product sales were $98,000 in the first six months of 2025, a 13 percent increase from $87,000 in the first six months of 2024. Gross margin for the first six months of 2025 was 98 percent, a 3-percentage point increase from a gross margin of 95 percent for the same period in 2024. Gross margin from royalties increased to 100 percent in the first six months of 2025, a 3-percentage point increase from 97 percent in the first six months of 2024. Product sales gross margin for the first six months of 2025 was 8 percent compared to a negative 21 percent in the prior year period.  Operating expenses decreased 5 percent to $3.4 million in the first six months of 2025 compared to $3.6 million in the same period of 2024. The Company recognized a tax expense of $442,000 in the first six months of 2025, compared to a tax expense of $669,000 in the prior year period. The decreased tax expense is primarily due to the lower pre-tax net income, partially offset by a deferred tax asset write-off of $119,000 relating to the pending dissolution of our Canadian entity. The Company’s net income for the first six months of 2025 was $1.1 million, or $0.21 per basic and diluted share, compared to a net income of $2.4 million, or $0.44 per basic and diluted share, in the first six months of 2024. On a non-GAAP basis, excluding the amortization of intangible assets and depreciation for the applicable periods, operating income for the second quarter of 2025 was $1.2 million compared to operating income of $2.0 million in the prior year period and $1.7 million for the first six months of 2025 compared to $3.3 million in the same period of 2024. “The decrease in royalty revenue this quarter reflects both a strategic product transition and broader macroeconomic factors,” said Andy Markese, Interim CEO of Autoscope Technologies and President and CEO of Image Sensing Systems. “As agencies evaluate and begin adopting Autoscope OptiVu, sales of legacy products like Autoscope Vision, which have historically driven our royalty base, have temporarily slowed. Federal funding uncertainty has extended procurement timelines and the Build America, Buy America requirements have impacted our customers’ supply chain. While these headwinds are real, we view them as part of a typical cycle.” “Additionally, we received royalties in late 2024 on larger inventory purchases made by distributors based on their projected project schedules and anticipated demand for 2025, resulting in lower royalties in the current year. Still, we expect Autoscope Vision royalties to rank among the top three years in the platform’s history. Our financial discipline and market experience position us well as OptiVu gains qualified listing approvals and agencies return to more predictable procurement,” concluded Mr. Markese. About Autoscope Technologies Corporation Autoscope Technologies Corporation is a global company dedicated to helping improve safety and efficiency for cities and highways by developing and delivering above-ground detection technology, applications and solutions. We give Intelligent Transportation Systems (ITS) professionals more precise and accurate information – including real-time reaction capabilities and in-depth analytics – to make more confident and proactive decisions. We are headquartered in Minneapolis, Minnesota. Visit us on the web at www.autoscope.com.  Forward-Looking Statements Certain statements and information included in this Annual Report constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange of 1934, as amended. Forward looking statements represent our expectations or beliefs concerning future events and can be identified by the use of forward-looking words such as “believes,” “may,” “will,” “should,” “intends,” “plans,” “estimates,” “expects,” “anticipates” or other comparable terminology. Forward-looking statements are subject to risks and uncertainties that may cause our actual results to differ materially from the results discussed in the forward-looking statements. Some factors that might cause these differences include the factors listed below. Although we have attempted to list these factors comprehensively, we wish to caution investors that other factors may prove to be important in the future and may affect our operating results. New factors may emerge from time to time, and it is not possible to predict all of these factors, nor can we assess the effect each factor or combination of factors may have on our business. Those risks and uncertainties may include, but are not limited to, our historical dependence on a single product for most of our revenue; competition; potential changes in government spending on transportation technology; acceptance of our product offerings and designs; budget constraints by governmental entities that purchase our products, including constraints caused by declining tax revenue; the continuing ability of Econolite Control Products, Inc. to sell our products and pay royalties owed to us; the mix of and margins on the products we sell; our dependence on third parties for manufacturing and marketing our products; our dependence on single-source suppliers to meet manufacturing needs; our failure to secure adequate protection for our intellectual property rights; our inability to develop new applications and product enhancements; the potential disruptive effect on the markets we serve of new and emerging technologies and applications, including vehicle-to-vehicle communications and autonomous vehicles; unanticipated delays, costs and expenses inherent in the development and marketing of new products; our inability to respond to low-cost local competitors; our inability to properly manage any growth in revenue and/or production requirements; the influence over our voting stock by affiliates; our inability to hire and retain key scientific and technical personnel; the effects of legal matters in which we may become involved; our inability to achieve and maintain effective internal controls; our inability to successfully integrate any acquisitions; tariffs and other trade barriers; our operating results fluctuate from quarter to quarter due to, among other reasons, the fact that our operating costs tend to be fixed, while our revenue tends to be seasonal; any significant variations between actual amounts and the amounts estimated for those matters identified as our critical accounting estimates and other significant accounting estimates made in the preparation of our financial statements; political and economic instability, including continuing volatility in the economic and political environment of the European Union, the war in Ukraine, the conflict between Israel and Hamas and other disruptions in the Middle East; our inability to comply with international regulatory restrictions over hazardous substances and electronic waste; the impact of international supply chain disruptions and delays; the impact of changes in U.S. federal and state income tax regulations; the impact of inflation and our ability to pass on rising prices to its customers; and conditions beyond our control such as war, terrorist attacks, health epidemics (including the COVID-19 pandemic caused by the coronavirus) and economic recession. We further caution you not to unduly rely on any forward-looking statements because they reflect our views only as of the date the statements were made. We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise.  Contact:  Andrew Markese, Interim CEO of AATC and President and CEO of ISNS 612-438-2363   Autoscope Technologies CorporationCondensed Consolidated Statements of Operations(in thousands, except per share information)(unaudited)     Three-Month Periods Ended June 30, Six-Month Periods Ended June 30,  2025   2024   2025   2024 Revenue       Royalties$2,821  $3,703  $4,947  $6,824 Product sales 31   71   98   87   2,852   3,774   5,045   6,911 Cost of revenue  50   177   90   313 Gross profit 2,802   3,597   4,955   6,598   98%  95%  98%  95%Operating expenses       Selling, general and administrative 996   1,143   2,028   2,406 Research and development 678   558   1,353   1,167   1,674   1,701   3,381   3,573 Income from operations 1,128   1,896   1,574   3,025 Other income (expense) (5)  11   4   20 Investment income 7   62   27   57 Interest expense, net (15)  (16)  (31)  (33)Income before income taxes 1,115   1,953   1,574   3,069 Income tax expense 344   406   442   669 Net income 771   1,547   1,132   2,400         Net income per share, basic$0.14  $0.28  $0.21  $0.44 Net income per share, diluted$0.14  $0.28  $0.21  $0.44         Weighted shares - basic 5,481   5,451   5,479   5,449 Weighted shares - diluted   5,491   5,453   5,491   5,451                  Autoscope Technologies CorporationCondensed Consolidated Balance Sheets(in thousands)(unaudited)     June 30, 2025 December 31, 2024Assets   Current assets   Cash and cash equivalents$2,354 $4,355Receivables, net 3,303  4,064Inventories 2,137  2,717Investment in debt and equity securities 252  3,091Prepaid expenses and other current assets 515  393  8,561  14,620Property and equipment, net 1,990  2,060Intangible assets, net 795  575Deferred taxes 1,480  1,908Operating lease asset, net 6  10 $12,832 $19,173    Liabilities and Shareholders’ Equity   Current liabilities   Accounts payable$38 $27Current maturities on long-term debt 64  63Warranty and other current liabilities 283  457  385  547Non-Current liabilities   Long-term debt, net of current liabilities 1,461  1,493    Shareholders’ equity  10,986  17,133 $12,832 $19,173       Autoscope Technologies Corporation.Condensed Consolidated Statements of Cash Flows(in thousands)(unaudited)   Six-Month Periods Ended June 30,  2025   2024 Operating activities   Net income$1,132  $2,400 Adjustments to reconcile net income to net cash   provided by operating activities   Depreciation and amortization 144   317 Stock-based compensation 114   120 Loss on disposal of assets -   1 Investment amortization -   43 Realized gain on available for sale investments (13)  - Unrealized gain on equity investment (1)  - Unrealized gain on available for sale investments -   (26)Amortization of debt issuance costs 1   1 Deferred income tax expense 433   673 Changes in operating assets and liabilities 1,057   (2,272)Net cash provided by operating activities 2,867   1,257     Investing activities   Purchases of property and equipment (21)  (20)Capitalized software development costs (272)  - Sale of securities 3,241   7,311 Purchase of securities (387)  (4,477)Net cash provided by investing activities 2,561   2,814     Financing activities   Dividends paid (7,400)  (8,622)Principal payments on long-term debt (32)  (31)Net cash used by financing activities  (7,432)  (8,653)    Effect of exchange rate changes on cash 3   (29)Decrease in cash and cash equivalents (2,001)  (4,611)    Cash and cash equivalents at beginning of period  4,355   6,506 Cash and cash equivalents at end of period$2,354  $1,895          Autoscope Technologies CorporationNon-GAAP Income from Operations(in thousands)(unaudited) We define non-GAAP income from operations as income from operations before amortization of intangible assets, depreciation, and restructuring charges for the applicable periods. Management believes non-GAAP income from operations is a useful indicator of our financial performance and our ability to generate cash flows from operations. Our definition of non-GAAP income from operations may not be comparable to similarly titled definitions used by other companies. The table below reconciles non-GAAP income from operations, which is a non-GAAP financial measure, to comparable GAAP financial measures:       Three-Month Periods Ended June 30, Six-Month Periods Ended June 30,  2025  2024  2025  2024        Income from operations$1,128 $1,896 $1,574 $3,025Amortization of intangible assets 26  132  53  263Depreciation 45  27  91  54Non-GAAP income from operations$1,199 $2,055 $1,718 $3,342             Note – Our calculation of non-GAAP income from operations is considered a non-GAAP financial measure and is not in accordance with, or preferable to, “as reported”, or GAAP financial data. However, we are providing this information, as we believe it facilitates analysis of the Company’s financial performance by investors and financial analysts. 

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