GET DAILY SIGNALSAudioEye (AEYE) Delivers Record Revenue and Turns GAAP Profitable in Q3 2026
Key Takeaways
- AudioEye posted record third-quarter 2026 revenue of $10.96 million, up 7% year over year, marking its 43rd consecutive quarter of record revenue.
- The company swung to GAAP profitability, reporting net income of $1.0 million, or $0.08 per diluted share, versus a net loss of $0.6 million a year earlier.
- Adjusted EBITDA climbed 58% year over year to $3.9 million, with an adjusted EBITDA margin of 35%.
- Annual Recurring Revenue (ARR) rose 12% year over year to $43.3 million, while the customer base grew to roughly 130,000.
- Management raised its full-year 2026 adjusted EBITDA guidance and authorized a new $15 million share repurchase program.
- Gross margin expanded by more than 550 basis points to 83%, driven by AI-powered efficiencies across the business.
Why These Results Matter
AudioEye operates in the digital accessibility space, assisting organizations in making websites and applications usable for individuals with disabilities and compatible with AI agents. The results stand out because the company has built a long track record of record revenue that demonstrates the resilience of its subscription model, while steadily shifting toward profitability. The third quarter of 2026 represents a notable milestone, with AudioEye achieving positive GAAP net income thanks to operating leverage from AI-driven efficiencies and careful cost control. Regulatory developments, including the European Accessibility Act and expanding U.S. state requirements, provide additional context on whether this growth can continue alongside improving margins.
Quarterly Performance Breakdown
AudioEye reported third-quarter 2026 revenue of $10.96 million, a 7% increase from $10.2 million in the same period last year and another quarterly record. Gross profit rose 15% to $9.09 million, expanding the gross margin to 83% from 77% a year earlier, while adjusted gross margin reached 88%. Operating expenses fell 5% to $7.8 million, aided by lower spending in sales, marketing, and research and development due to AI efficiencies.
The company delivered net income of $1.0 million, or $0.08 per diluted share, compared with a net loss of $0.6 million, or $0.04 per share, in the prior-year quarter. Adjusted EBITDA increased 58% to $3.9 million, and adjusted EPS came in at $0.30, up from $0.19 a year ago. ARR finished the quarter at $43.3 million, up 12% year over year and up $1.0 million sequentially, while free cash flow reached $3.5 million.
For the fourth quarter of 2026, AudioEye guided to revenue of $11.4 million to $11.6 million and adjusted EBITDA of $4.2 million to $4.4 million, with adjusted EPS of $0.32 to $0.33. Full-year 2026 revenue guidance was narrowed to $43.6 million to $43.8 million, and full-year adjusted EBITDA guidance was raised to $13.4 million to $13.6 million, representing approximately 50% year-over-year growth.
I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Initial Market Response
AudioEye’s results prompted a mixed early reaction. The company’s adjusted EPS of $0.30 exceeded the consensus estimate of $0.27, and revenue slightly surpassed expectations of roughly $10.94 million. That said, the GAAP diluted EPS of $0.08 fell short of the headline consensus of $0.28, and shares initially traded lower in after-hours activity. This divergence underscores how investors focus on non-GAAP metrics, which adjust for stock-based compensation, depreciation, amortization, interest, and litigation expenses. Sentiment also reflects the raised adjusted EBITDA outlook, the new $15 million buyback authorization, and the initial rollout of two AI products that management views as meaningful upselling opportunities.
What to Watch Going Forward
Looking ahead, the focus will be on whether AudioEye can convert its revenue momentum into sustained and expanding profitability. Management highlighted an expected fourth-quarter adjusted EBITDA run rate above $17 million, which would support meaningful free cash flow generation into 2027. The newly authorized $15 million share repurchase program, representing roughly 15% of outstanding shares at recent prices, signals confidence in the cash position.
Product development remains a key area. In October, AudioEye launched two AI-powered offerings, Agentic Audits and the SDK MCP, both built on its proprietary “AudioEye Intelligence” dataset. These tools target developers and enterprises and are positioned as upselling opportunities, though it is still early to assess their revenue impact.
Regulatory changes could also influence demand. The European Accessibility Act and new U.S. state laws, such as Hawaii’s Act 257, may expand compliance needs that support adoption of AudioEye’s solutions. At the same time, it will be important to monitor customer-count trends, any re-acceleration in ARR growth, and further reductions in litigation expense, which is expected to ease in the fourth quarter.
AI Tools in My Research Process
From what I see, tools like Tickeron’s AI Screener help streamline the process of comparing companies such as AEYE against peers by filtering on fundamentals, patterns, and performance metrics. I find it useful for quickly surfacing relevant data when evaluating earnings reports and building watchlists based on personal criteria.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
AEYE in downward trend: price may decline as a result of having broken its higher Bollinger Band on October 20, 2026
AEYE broke above its upper Bollinger Band on October 20, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options. The A.I.dvisor looked at 43 similar instances where the stock broke above the upper band. In 40 of the 43 cases the stock fell afterwards. This puts the odds of success at 90%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day RSI Indicator for AEYE moved out of overbought territory on October 21, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 26 similar instances where the indicator moved out of overbought territory. In 23 of the 26 cases, the stock moved lower in the following days. This puts the odds of a move lower at 88%.
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where AEYE declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 86%.
The Aroon Indicator for AEYE entered a downward trend on October 20, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 19, 2026. You may want to consider a long position or call options on AEYE as a result. In 78 of 96 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 81%.
The Moving Average Convergence Divergence (MACD) for AEYE just turned positive on October 20, 2026. Looking at past instances where AEYE's MACD turned positive, the stock continued to rise in 39 of 47 cases over the following month. The odds of a continued upward trend are 83%.
AEYE moved above its 50-day moving average on October 20, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for AEYE crossed bullishly above the 50-day moving average on October 22, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 14 of 18 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 78%.
The 50-day moving average for AEYE moved above the 200-day moving average on October 20, 2026. This could be a long-term bullish signal for the stock as the stock shifts to an upward trend.
Following a +22.97% 3-day Advance, the price is estimated to grow further. Considering data from situations where AEYE advanced for three days, in 218 of 258 cases, the price rose further within the following month. The odds of a continued upward trend are 84%.
Fundamental Analysis (Ratings)
The Tickeron Price Growth Rating for this company is 41 (best 1 - 100 worst), indicating steady price growth. AEYE’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 68 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 77 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (31.512) is normal, around the industry mean (-1.853). P/E Ratio (-21.838) is within average values for comparable stocks, (15.200). Projected Growth (PEG Ratio) (2.162) is also within normal values, averaging (2.824). Dividend Yield (0.000) settles around the average of (0.075) among similar stocks. P/S Ratio (2.128) is also within normal values, averaging (71.128).
The Tickeron SMR rating for this company is 98 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. AEYE’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 94, placing this stock worse than average.
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General Information
a developer of patented Internet content publication and distribution software
Industry PackagedSoftware
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