BIO-key International Inc., a provider of Identity and Access Management solutions, reported its financial results for the first quarter of 2025. The company recorded a revenue of $1.6 million, marking an approximate 10% sequential increase compared to the fourth quarter of 2024. However, year-over-year revenue saw a decline of 25%, primarily due to a significant two-year contract with a financial services customer in Q1'24 worth $1.2 million, compared to $690,000 recorded in Q1'25 for incremental biometric capabilities. The company's gross profit decreased to $1.33 million in Q1'25 from $1.88 million in Q1'24, with gross margins of 82.6% and 86.3%, respectively. The decline in gross profit was attributed to lower revenue and increased lower margin hardware sales. Operating expenses were reduced by $422,195 to $1.97 million in Q1'25 from $2.39 million in Q1'24, mainly due to a 23% reduction in selling, general, and administrative expenses. This decrease was a result of lower administration, sales personnel costs, and professional service fees. BIO-key's net loss increased to $736,545 in Q1'25, compared to a net loss of $510,285 in Q1'24. The company's cash position improved significantly to $3.1 million, reflecting proceeds from warrant exercises early in Q1'25, contributing to a total current asset value of $4.6 million as of March 31, 2025. Looking ahead, BIO-key anticipates significant revenue increase from its long-term financial services customer in 2026, driven by expanded deployments and the addition of a new biometric ID system.