Development during the period

Revenues and operating result, second quarter 2025

Revenues

Group revenues for the second quarter of 2025 amounted to SEK 15.7 M (11.2), corresponding to an increase of 40 percent compared with the second quarter of 2024 (increase of 56 percent in constant currency terms). The revenue increase reflects an increased demand for biometric authentication across our portfolio.

In addition, we reported SEK 8.3 million in revenue from discontinued operations, related to final last-time-buy deliveries to PC and Mobile customers (approximately SEK 4.2 million), along with a SEK 4.1 million non-cash effect from the reversal of previously accrued marketing incentives, which reduced liabilities and increased reported revenue in discontinued operations.

Trend in operating profit

Gross profit for the second quarter was SEK 7.6 M (6.0) and the gross margin was 48.1 percent (53.5). 

Development costs amounted to SEK 15.9 M (34.3). As of Q1 2025, we have adopted a new accounting principle for the reporting of development costs. Before Q1 2025, depreciation of capitalized development expenses was recognized in cost of goods sold, thereby affecting gross margin. As of January 1, 2025, depreciation of previously capitalized development costs is instead recognized within the development costs function in the income statement. The comparative figures for previous periods have been recalculated. Reporting all R&D-related costs, including depreciation of previously capitalized costs within the R&D function on one and the same line in the income statement, has been deemed to lead to financial statements that give a more accurate view of the company's gross margins and also increase comparability with other companies in the industry.

The operating result for the second quarter was a negative SEK 30.5 M (neg: 69.2). Operating expenses amounted to SEK 39.0 M (75.7), including depreciation of capitalized development expenses amounting to SEK 8.4 M (9.8). Other operating income amounted to a positive SEK 0.9 M (pos: 0.5), pertaining to exchange-rate fluctuations attributable to operating working capital.

Revenue breakdown

Revenue is reported by geography: EMEA, Americas and APAC. 

Effects of the wind-down of the Mobile and PC product groups

FPC has completed the wind-down of its loss-making operations in the Mobile and PC product groups in order to safeguard the company's financial health and future viability. During the January 2024 - June 2025 period, the wind-down process had the following financial effects: 

Mobile

• Inventory write-downs amounting to SEK 61.3 M and a SEK 7.1 M impairment of capitalized R&D.
• As a result of the exclusive partnership agreement with Egis Technology in the Mobile area, FPC has thus far recognized SEK 40 M in revenue.
• SEK 28.6 M in costs related to restructuring measures.
• Revenue positively impacted by a reversal of accrued marketing incentives to customers in the Mobile area, amounting to SEK 24.7 M.

PC

• A SEK 32.3 M write-down of capitalized R&D projects in the PC area.
• An inventory write-down amounting to SEK 10.2 M.
• Revenue positively impacted by a reversal of accrued marketing incentives to customers in the PC area, amounting to SEK 4.1 M.

Financial income and expenses

Financial income amounted to SEK 0.0 M (0.3). This item pertains to interest income on bank balances. Financial expenses amounted to SEK 0.3 M (11.6). 

Earnings and earnings per share for the reporting period

The result for the second quarter of 2025 was a negative SEK 22.7 M (neg: 183.7). Earnings per share for the second quarter were a negative SEK 0.00 (neg: 0.01). As the subscription price in the rights issue, completed in Q3 2024, was below the market price, a fund element has been identified, which means that the comparison figures have been recalculated.

Cash flow and balance sheet, second quarter of 2025

Cash flow

Cash flow from operating activities for the second quarter was negative SEK 18.3 M (neg: 20.9), including a positive SEK 0.2 M attributable to discontinued operations. Adjustments for non-cash items, amounting to SEK 9.4 M, mainly pertain to depreciation.

Cash flow from investing activities for the second quarter amounted to negative SEK 0.1 M (neg: 2.6), pertaining to capitalized development expenses in the quarter.

Cash flow from financing activities was negative SEK 0.9 M (pos: 167.4), pertaining to leasing fees on leased premises (rights issue also included in last year's figure).

Exchange-rate fluctuations had SEK negative 0.6 M (neg: 0.1) impact on cash and cash equivalents during the quarter.

Inventory amounted to SEK 22.0 M at the end of the second quarter, compared to SEK 70.6 M at the end of the second quarter 2024 and SEK 22.9 M at the end of the first quarter 2025. 

Liquidity and shareholders’ equity

As at June 30, 2025, the Group’s disposable cash and cash equivalents totaled SEK 32.7 M compared with SEK 52.6 M at March 31, 2025, and the Group’s net cash amounted to SEK 28.3 M on June 30, 2025, compared with net cash amounting to SEK 47.2 M as at March 31, 2025. Lease liabilities pertaining to office premises amounted to SEK 4.5 M on June 30, 2025, compared with SEK 5.4 M as at March 31, 2025, recognized in accordance with IFRS 16. 

At period-end, consolidated shareholders’ equity amounted to SEK 295.2 M, compared to SEK 330.5 M as at March 31, 2025 and the equity/assets ratio for the Group to 89.7 percent (85.8 as at March 31, 2025). 

Total comprehensive income in the second quarter amounted to a negative SEK 35.3 M (neg: 190.2) and included the remeasurement of shareholders’ equity in foreign currencies.

Investments, fixed assets and depreciation/amortization

Investments in intangible fixed assets during the quarter amounted to an expense of SEK 0.1 M (expense: 2.6). Investments in tangible fixed assets for the quarter amounted to an expense of SEK 0.0 M (expense: 0.0). Depreciation/amortization according to plan for the quarter totaled SEK 10.2 M (11.6). 

Financial fixed assets pertain to deferred tax of SEK 54.8 M, compared to 54.8 as at March 31, 2025.

Comments on the period January - June 2025

The Group’s revenue for the period January–June 2025 totaled SEK 33.9 M (20.4), corresponding to an increase of 66 percent compared with the corresponding period 2024. This reflects strong demand across our portfolio of biometric authentication solutions and underscoring the growing traction of our strategy to focus on high-value markets.

Gross profit for the period January-June 2025 was SEK 17.9 M (12.0) and the gross margin was 53.0 percent (59.0).

Cash flow from operating activities for the period was negative SEK 54.7 M (neg: 81.0), including a negative SEK 22.0 M attributable to discontinued operations. 

Cash flow from financing activities amounted to SEK 77.0 M (165.9). Cash payments related to transaction costs for the rights issue completed in the first quarter 2025, amounting to SEK 21.9 M, affected cash flow from financing activities negatively, while the receipt of a partial tranche and subsequent repayment of the bridge loan had a SEK 14 M negative effect. Leasing fees on leased premises amounted to a negative SEK 2.2 M (neg: 3.1).

Significant events during the second quarter of 2025

On June 24, FPC published the bulletin from the Annual General Meeting. The AGM resolved on, among other things, to approve proposals to carry out a reverse share split, and implement an employee stock option program for FPC employees as well as for the Board of Directors of FPC. Two new Board members were elected: John Lord and Carl Johan Grandinson.

Other events during the second quarter of 2025

Business Development

On June 24, 2025, FPC announced that its partner, Fuse Identities, has launched its latest product, a cutting-edge biometric physical access card, equipped with the advanced FPC 1323 T-Shape sensor. This breakthrough solution delivers a new standard of secure, contactless identity verification for modern access control systems.

On June 2, 2025, FPC announced its membership with LEGIC Identsystems AG (LEGIC), a renowned provider of secure access and credentialing solutions. This strategic partnership aims to integrate FPC’s advanced biometric technology into LEGIC's ecosystem, enhancing security and convenience across various sectors.

On April 28, 2025, announced that Mantra Softech India Private Limited, India’s leading biometrics and RFID technology company, has extended its licence for FPC’s iris recognition software platform. This strategic move aims to further strengthen Mantra's position in the Indian market, but also support their expansion into emerging markets, integrating advanced iris recognition technology into their security solutions.

On April 24, 2025, FPC announced the first major partnership milestone with Anonybit, achieved through a new integration with Ping Identity’s PingOne DaVinci™, advancing privacy-first biometric authentication for the enterprise.

Significant events after the end of the period

On August 7, 2025, FPC announced that it has entered into an agreement whereby certain PC-related assets will be licensed to Egis Technology (Egis) for a consideration amounting to approximately SEK 24 million (USD 2.5 million), with the majority of the payment anticipated in the third quarter of 2025. The agreement also includes royalty payments that are contingent on Egis’s shipment volumes to PC OEMs.

On July 16, 2025, FPC issued an update on the upcoming reverse share split, which was approved by the AGM held on June 24, 2025, but could not be carried out due to unforeseen technical issues beyond Fingerprint Cards AB’s (publ) (“FPC” or the “Company”) control. On July 8, 2025, the Company withdrew the resolution for the record date planned to be held on July 11, 2025 (as communicated on July 3, 2025). The issues were related to an inaccurate provided estimate of shares required to round up each shareholder’s holdings. The actual number of shares needed proved to be significantly higher, which if the reverse share split had been conducted, would have resulted in considerable cost to the Company in providing the rounding shares. To mitigate this and facilitate a reverse share split, the Board of Directors have decided to propose the Extraordinary General Meeting a revised intended technique for the reverse share split and instead use a so-called “rounding down-method”, meaning that for those shareholders who on the record date for the aggregation do not hold a number of Class B shares corresponding to a whole number of new ordinary shares (after the aggregation has been completed), excess Class B shares will be transferred to the Company's ownership on the record date for the aggregation. Excess Class B shares will then be sold by the Company or a securities institution appointed by the Company, whereby eligible shareholders will receive their share of the sale proceeds. Under the revised reverse split process, shareholders who do not hold an exact multiple of 2,000 shares will receive cash compensation for any excess shares. This ensures no economic loss to Class B shareholders. The reverse share split would mean that the Company’s Class A and Class B shares will be subject to a reverse split at a ratio of 1:2,000, resulting in one (1) share for every two thousand (2,000) existing shares of the same class, with all class-specific rights and characteristics remaining unchanged. After the reverse share split has been completed, the number of shares and votes in the Company, based on the current number of outstanding shares, will decrease from 15,175,375,766 shares (7,875,000 A-shares and 15,167,500,766 B-shares) and 15,246,250,766 votes to 7,587,687 shares (3,937 A-shares and 7,583,750 B-shares) and 7,623,120 votes. The reverse share split is proposed by the Board of FPC considering the Company's operational and financial progress in recent years, which enables continued growth initiatives, and to achieve an appropriate number of shares for the Company. The Company intends to carry out the reverse share split during the third quarter of 2025. A notice of the Extraordinary General Meeting was published in a separate press release on July 16, 2025.

Organization and Personnel

The number of employees as at June 30, 2025 was 39 (95). In addition to employees, consultants were also engaged during the first quarter, corresponding to 13 people (24), mainly in technology development and sales. Accordingly, including employees and consultants, the company employed a total of 52 (119) people on June 30, 2025. 

Share capital trend

As at 30 June 2025, the total number of shares in the Company amounted to 15,175,375,766 (of which 7,875,000 A-shares and 15,167,500,766 B-shares). The total number of votes in the Company amounted to 15,246,250,766 (of which 78,750,000 pertained to the A-shares and 15,167,500,766 pertained to the B-shares).

The company had 3,800,000 B shares in treasury at the end of the period. The share capital amounted to SEK 162,023,052.

Accounting policies

These condensed consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). The interim report for the Parent Company was prepared in accordance with the Annual Accounts Act, Chapter 9, Interim reports. The application of these accounting policies complies with what is presented in the Annual Report for the fiscal year ending December 31, 2024, except as stated below, and must be read together with the Annual Report. In addition to the financial statements and the associated notes, disclosures according to IAS 34.16A are also presented in other parts of the interim report. 

As of 1 January 2025, the Group reports discontinued operations in accordance with IFRS 5. The discontinued operations consist of the Mobile, PC and Access China operations that were discontinued as of March 31, 2025. This means that the profit from the discontinued operations has been broken out of the income statement and is reported separately as profit after tax from discontinued operations. The comparative figures in the income statement with associated key figures and notes have also been restated.  

The Group has also changed its principle regarding the reporting of R&D costs. Depreciation of capitalized development expenses has previously been recognized in cost of goods sold, thereby affecting gross margin. As of January 1, 2025, depreciation of previously capitalized development costs is instead recognized within the development costs function in the income statement. The comparative figures for previous periods have been recalculated. Reporting all R&D-related costs, including depreciation of previously capitalized costs within the R&D function on one and the same line in the income statement, has been deemed to lead to financial statements that give a more accurate view of the company's gross margins and also increase comparability with other companies in the industry.

Revenue is reported by geography: EMEA, Americas and APAC. 

No new or revised IFRSs that have become effective in 2025 have had any significant impact on the Group. The Group’s reporting currency is SEK and the report is prepared in SEK M.

Critical estimates and judgments

With its Audit Committee, management has discussed the progress, selection and disclosure of the Group’s critical accounting policies and estimates, as well as the application of these principles and estimates. Pursuant to IAS 1, the company should disclose the assumptions and other important sources of uncertainty in estimates, which if actual outcomes differ, can have a material impact on the financial statements. In cases where this occurs, estimates and judgments have been moved to the relevant note. A summary of the areas that management considers to contain material estimates and judgments follow:

• Deferred tax
• Capitalization of development costs
• Impairment testing of goodwill and other intangible assets
• Inventory valuation 

Related-party transactions

There were no material transactions between the company and related parties in the Group or the Parent Company during the reporting period.

Parent Company

The Parent Company’s revenues for the second quarter of 2025 amounted to SEK 0.9 M (pos: 0.1). After financial items, a loss of SEK 50.0 M (pos: 22.8) was reported for the period. The net result for the period was a loss of SEK 49.7 M (loss: 51.9). The Parent Company’s disposable cash and cash equivalents at period-end totaled SEK 8.6 M (157.1).

Significant risks and uncertainties – Group and Parent Company

To anticipate risks and minimize their impact, FPC has processes for continuously identifying and managing risks that could impact the operations. This includes probability and consequence assessments of operational risks, market risks, financial risks and legal and other risks.

The described risks and uncertainties are not ranked in any order of significance; nor are they claimed to be the only risks or uncertainties to which the company is exposed. Additional risks and uncertainties that the company is currently unaware of or that are currently not adjudged to be material could develop into factors that might in the future have a material impact on the company’s operations, earnings, financial position or future outlook. The following description does not claim to be complete or exact, since risks and their degree of impact vary over time.

Operational risks

• Risks associated with the implementation of the company's transformation plan.
• Delivery capacity of contracted suppliers.
• Risks related to outsourcing.
• Reduced technological leadership.
• Risks related to the general perception of biometric sensors.
• The company is dependent on its key employees.
• Leaks and infringements regarding business secrets.
• IT and cybersecurity risks, as well as risks related to system failures, downtime and other interruptions
• Internal scalability.

Market risks

• Geopolitical instability.
• Supplier costs.
• Economic fluctuations.
• Currency risk.
• Loss of customers and price pressure due to increased competition.

Finance risks

• Credit risk.
• Financing.

Legal risks

• Competitor IP.
• Value of Patent IP.
• Products defects and product liability.
• Risks related to the processing of personal data.
• FPC’s operations are subject to a number of regulatory compliance risks.
• Risks related to judicial and administrative proceedings.

FPC’s current assessment is that the company is not materially impacted directly by the war between Russia and Ukraine, nor by any other ongoing armed conflicts. We closely monitor developments related to increased trade tensions and maintain readiness to take appropriate action to mitigate potential negative effects.  At this stage, the company does not view this as a material risk to its operations.

Further information

This is the type of information that Fingerprint Cards AB is obligated to disclose pursuant to the EU’s Market Abuse Regulation. The information was submitted for publication, through the agency of the contact specified below, at 7:00 a.m. CEST on August 14, 2025.

Welcome to FPC’s presentation of the interim report for the second quarter of 2025 on August 14, 2025, at 09:00 a.m. CEST. The presentation will be webcast, and participants can register via the link below: https://edge.media-server.com/mmc/p/mvvrj2ob 

For media and analysts: Register for the teleconference via this link: https://register-conf.media-server.com/register/BId69a300668974f5d9ba1008e86c69f49 

For further information, please contact:

Investor Relations: +46(0)10-172 00 10, investrel@fpc.com
Press: +46(0)10-172 00 20, press@fpc.com

www.fpc.com

Issuance, publication or distribution of this press release in certain jurisdictions could be subject to restrictions. The recipient of this press release is responsible for using this press release and the constituent information in accordance with the rules and regulations prevailing in the particular jurisdiction. This press release does not constitute an offer, or invitation to acquire or subscribe for new securities in Fingerprint Cards AB in any jurisdiction.
 

Certification

The Board of Directors and the CEO certify that this report provides a fair and accurate review of the operations, financial position and earnings of the Parent Company and the Group and that it describes the significant risks and uncertainties facing the Parent Company and the companies included in the Group.

Stockholm, August 13, 2025

Review Report

This interim report has not been examined by the company’s auditors.