Iteris Reports Record Quarterly Revenue of $45.8 Million

Record trailing six-month net bookings of $102.1 million and record ending backlog of $126.8 million

AUSTIN, TX – August 8, 2024 – Iteris, Inc., the global leader in smart mobility infrastructure management, today reported financial results for its fiscal first quarter ended June 30, 2024.

Fiscal 2025 First Quarter Financial Highlights

• Revenues of $45.8 million, up 5.1% year over year compared to an unusually strong prior year period
• Net new bookings of $48.8 million, resulting in record trailing six months net new bookings of $102.1 million
• Record Backlog of $126.8 million as of March 31, 2024, up 2.4% year over year
• GAAP net income of $0.4 million, or $0.01 per diluted share, compared to $2.1 million, or $0.05 per diluted share, in the same quarter a year ago, which benefited from timing effects
• Adjusted EBITDA of $2.9 million, or 6.3% of revenue, compared to $4.0 million, or 9.2% of revenue, in the same quarter a year ago (see “Non-GAAP Financial Measures and Reconciliation” below for important information)
• Adjusted Net Income of $2.8 million, or $0.06 per share, compared to $4.0 million, or $0.09 per share, in the same quarter a year ago (see “Non-GAAP Financial Measures and Reconciliation” below for important information)
• Cash and cash equivalents of $21.4 million as of June 30, 2024, primarily reflecting higher working capital and after $0.6 million used in the first quarter for share repurchases
• Announced strategic partnership with Sumitomo Electric Industries that is expected to transform pedestrian detection in North America and double the total addressable market for the Company’s detection sensors
• Announced that Telenav will use Iteris’ ClearData® to enhance Telenav’s navigation applications demonstrating continued penetration of new private-sector market segments
• Awarded a contract to develop the intelligent transportation systems master plan for the Cebu metropolitan area, a major domestic and international port in the Philippines, demonstrating growing international demand for Iteris’ capabilities

Management Commentary:

“We are pleased to report another quarter of solid organic revenue growth year-over-year, especially given the challenging prior year comparison,” said Joe Bergera, president and CEO of Iteris. “Additionally, we continued to meet the major milestones for our planned new product launches, including the release of our new Vantage PedSafe™ sensor and Vantage Apex® Rackmount products, which we believe will accelerate revenue growth in our fiscal 2025 second half.

“Looking ahead, we believe our portfolio of smart mobility infrastructure management solutions will continue to benefit from positive tailwinds. Therefore, over the long term, we continue to anticipate strong organic revenue and profit growth consistent with our Vision 2027 targets, which assume a five-year organic revenue CAGR of approximately 14% and adjusted EBITDA margins in the range of 16% to 19% of revenue by fiscal 2027.”

Fiscal 2025 Full Year Outlook

• Reiterating full year total revenues of $188.0 million to $194.0 million, representing organic growth of 11% year over year at the mid-point of the guidance range
• Reiterating full year adjusted EBITDA margin in the range of 8.0% to 10.0% of revenue, representing a 150 basis points improvement at the midpoint of the guidance range (see “Non-GAAP Financial Measures and Reconciliation” below for important information)

Fiscal 2025 Second Quarter Outlook

• Total revenues of $44.0 million to $48.0 million, representing organic growth of 6% year over year at the mid-point of the guidance range due to the timing of new product introduction cycles
• Adjusted EBITDA margin in the range of 6.0% to 7.0% of total revenue (see “Non-GAAP Financial Measures and Reconciliation” below for important information)

GAAP Fiscal First Quarter 2025 Financial Results

Total revenue in the first quarter of fiscal year 2025 increased 5.1% to $45.8 million, compared with $43.5 million in the same quarter a year ago. Revenue increased for both products and services, with higher than aggregate services growth driven primarily by an increase in revenues related to subscription revenues. Product revenues also increased, but at a lower rate when compared to the prior year.

Operating expenses in the first quarter increased 15.1% to $17.1 million, compared with $14.9 million in the same quarter a year ago. The largest increase was in sales and marketing cost, reflecting increased headcount and higher sales and marketing expenses associated with several large sales pursuits, followed by an expected increase in research and development expense supporting new products.

Net income in the first quarter was $0.4 million, or $0.01 per share, compared with a net income of $2.1 million, or $0.05 per share, in the same quarter a year ago. The decline resulted from higher operating expense which more than offset the higher gross profit.

Non-GAAP Fiscal First Quarter 2025 Financial Results

In addition to results presented in accordance with generally accepted accounting principles in the United States (“GAAP”), Iteris (the “Company”) has included the following non-GAAP financial measures: net income before interest, taxes, depreciation, amortization, stock-based compensation expense, executive severance and transition costs and other legal expenses (“Adjusted EBITDA”); and net income before depreciation, amortization, stock-based compensation expense, executive severance and transition costs, other legal expenses and the tax effect of adjustments (”Adjusted Net Income”). Basic and Diluted Adjusted Net Income Per Share (“Basic Adjusted EPS” and “Diluted Adjusted EPS”, collectively, “Adjusted EPS”) are calculated as Adjusted Net Income divided by our basic and diluted weighted-average number of shares outstanding, respectively. Components of these non-GAAP financial measures may be adjusted from time to time to reflect specific events and circumstances as they occur. A discussion of the Company’s use of these non-GAAP financial measures is set forth below in the financial statements portion of this release under the heading “Non-GAAP Financial Measures and Reconciliation,” along with a reconciliation of Adjusted EBITDA to net income and Adjusted Net Income to net income.

Adjusted EBITDA in the first quarter of fiscal 2025 was approximately $2.9 million, or 6.3% of total revenues, compared to approximately $4.0 million, or 9.2% of total revenues, in the same quarter a year ago. The reductions in the current year primarily mirror the decline in GAAP earnings as described above, except for executive severance and transition costs incurred in the current year that are excluded from Adjusted EBITDA.

Adjusted net income in the first quarter of fiscal 2025 was approximately $2.8 million, or $0.06 per share, compared with approximately $4.0 million, or $0.09 per share in the same quarter a year ago. The reductions in the current year reflect the same factors as noted for the Adjusted EBITDA comparison, except for the tax effect on adjustments.

Earnings Conference Call

Iteris will conduct a conference call today to discuss its fiscal 2025 first quarter results.

Date: Thursday, August 8, 2024
Time: 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time)
Toll-free dial-in number: 800-715-9871
International dial-in number: +1 646-307-1963
Participant instructions: Ask operator to join the Iteris earnings call

If joining by phone, please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

To listen to the live webcast or view the press release, please visit the investor relations section of the Iteris website at www.iteris.com.

A telephone replay of the conference call will be available approximately two hours following the end of the call and will remain available for one week. To access the replay, dial +1-877-481-4010 (US Toll Free), or +1 919-882-2331 (International) and enter replay passcode 50943.

About Iteris, Inc.

Iteris is the world’s trusted technology ecosystem for smart mobility infrastructure management. Delivered through Iteris’ ClearMobility Platform, our AI-powered end-to-end solutions monitor, visualize and optimize mobility infrastructure around the world, and help bridge legacy technology silos to unlock the future of transportation. That’s why more than 10,000 public agencies and private-sector enterprises focused on mobility rely on Iteris every day. Visit www.iteris.com for more information, and join the conversation on Twitter, LinkedIn and Facebook.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

This release may contain forward-looking statements, which speak only as of the date hereof and are based upon our current expectations and the information available to us at this time. Words such as "believes," "anticipates," "expects," "intends," "plans," "seeks," "estimates," "may," "will," "can," and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements about the Company’s anticipated demand and growth opportunities, conversion of bookings to revenue, the impact and success of new solution offerings, the Company’s acquisitions, our future performance, growth and profitability, operating results, and financial condition and prospects. Such statements are subject to certain risks, uncertainties, and assumptions that are difficult to predict, and actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors.

Important factors that may cause such a difference include, but are not limited to, federal, state and local government budgetary issues, spending and scheduling changes, funding constraints and delays, and impact related to the federal government debt ceiling; uncertainties regarding potential multiple negative impacts that may occur in the future due to COVID-19 or other similar global health emergencies; our ability to source key raw materials in the global supply chain; the timing and amount of government funds allocated to overall transportation infrastructure projects and the transportation industry; risks related to our ability to recruit, integrate and/or retain key talent; our ability to replace large contracts once they have been completed; the effectiveness of efficiency, cost, and expense reduction efforts; our ability to successfully complete and integrate acquired assets and companies; our ability to specify, develop, complete, introduce, market and gain broad acceptance of our new and existing product and service offerings; the potential unforeseen impact of product and service offerings from competitors, increased competition in certain market segments, and such competitors’ patent coverage and claims; any softness in the markets that we address; and the impact of general economic and political conditions and specific conditions in the markets we address, and the possible disruption in government spending and commercial activities, such as import/export tariffs, terrorist activities or armed conflicts in the United States and internationally. Further information on Iteris, Inc., including additional risk factors that may affect our forward-looking statements, as contained in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K, and our other SEC filings that are available through the SEC's website (www.sec.gov).

Iteris Contact

Kerry Shiba
Senior Vice President, Chief Financial Officer, Secretary and Treasurer
Tel: [(949) 270-9457](tel:(949) 270-9457)
Email: [email protected]