Company: AWRE
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000950170-25-101395
Chunk: 26

Company: AWARE INC /MA/
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 8
Chunk 26
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4, respectively.  The income tax expense relates to limitations on the usage of net operating loss carryforwards generated in years beginning after December 31, 2017.We are subject to income taxes in the United States, and we use estimates in determining our provisions for income taxes. We account for income taxes using the asset and liability method for accounting and reporting income taxes. Deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax bases of assets and liabilities using statutory rates.

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We have evaluated the positive and negative evidence bearing upon our ability to realize our deferred tax assets, which primarily consist of net operating loss carryforwards and research and development tax credits.  We considered the history of cumulative net losses, estimated future taxable income and prudent and feasible tax planning strategies and we have concluded that it is more likely than not that we will not realize the benefits of our deferred tax assets.  As a result, as of June 30, 2025 and December 31, 2024, we recorded a full valuation allowance against our net deferred tax assets.Liquidity and Capital ResourcesAt June 30, 2025, we had cash, cash equivalents and marketable securities of $23.7 million, which represented a decrease of $4.1 million from December 31, 2024. The decrease in cash, cash equivalents and marketable securities was primarily due to the impact of $4.1 million of cash used in operating activities.Cash used in investing activities was $1.5 million in the first six months of 2025, which primarily consisted of $1.5 million of net purchases of marketable securities and $45,000 thousand used for the purchase of fixed assets.Cash used by financing activities was $88 thousand in the first six months of 2025, which primarily consisted of cash used to repurchase shares of our common stock.While we cannot assure you that we will not require additional financing, or that such financing will be available to us, we believe that our cash and cash equivalents will be sufficient to fund our operations for at least the next twelve months from the date of this filing and to meet our known long-term cash requirements.  Whether these resources are adequate to meet our liquidity needs beyond that period will depend on our future growth, operating results, and the investments needed to support our operations.  If we require additional capital resources, we may utilize available funds or seek external financing, which may not be available on terms we find attractive or at all.To date