It seems that technology is really moving into biometrics these days. Corporate and government organizations are moving away from password-based security to iris and fingerprint identification. You can say all you want about privacy and “Big Brother,” but the fact of the matter is, this technology and its industry are growing by leaps and bounds.
One very small company that’s growing very quickly in this business is AuthenTec, Inc. (NASDAQ/AUTH). This company sells fingerprint authentication sensors and chips to PC, wireless device, and what are known as security access control markets.
The company’s technology allows fingerprints to be read below the surface of the skin to what is known as the “live layer.” Apparently, this is your true fingerprint and the company’s products can accurately read your true fingerprint (which is unique) under virtually all circumstances (like outside in a blizzard).
AuthenTec sells its products to big-name customers like Fujitsu, HP, Hitachi, HTC, Lenovo, LG Electronics, Samsung, and Toshiba, as well as others.
In its first quarter of 2008, the company’s revenues grew 67% to fifteen and a half million dollars. The company is just turning to profitability. In its latest quarter, GAAP net income was $188,000, or $0.01 per diluted share, as compared to net loss of $5.7 million, or ($7.30) per diluted share, in the first quarter of 2007.
Right now, AuthenTec is investing heavily in its technology and expects strong growth going forward.
This company is a relative new listing on the market and, because of its timing, the stock was hurt by the broader market’s correction.
I think the identification and biometric business is going to be very successful over the coming years. It’s a major step forward in personal and corporate security and I wouldn’t be surprised to see small, growing companies like AuthenTec gobbled up by bigger players for their technology assets.