AudioEye
A small company that sells software to make websites usable by disabled people, and to keep their owners out of court.
The scores
Growth3/4 →
Revenue grew 15% in 2025 and about 8% in 2026, partly bought; ARR grows 12% with customers up 6%.
Business quality2/4 →
Partner distribution brings 130,000 small customers, but the product is substitutable, advocates reject it and rivals sell the same plug-in.
Financial position3/4 ↑
Net debt about $7.3M against cash from operations of $6.6M, loan due 2030, but covenants were loosened twice in 2026.
Execution record3/4 ↑
43 straight record revenue quarters and EBITDA guides raised, but the 2026 revenue guide was cut to its low half and litigation recurs.
Per share capture3/4 →
Shares up about 17% since 2021 against revenue per share up 48%; pay in shares near 12% of revenue.
Potential2/4 →
A US market near $2.7B at its price, but growth needs enforcement it does not control and AI products with no revenue.
Risk profile2/4 →
One partner at 13% of revenue, an undisclosed active lawsuit, and an FTC precedent against plug-in compliance claims.
Valuation2/4 ↓
At 4.36 times sales the price needs about 13% yearly growth for ten years, above revenue's 8% and ARR's 12%.
Evidence quality3/4 →
Filed figures carry revenue, debt and channels, but the legal-protection case and the AI products rest on management's word.
If it works 0.9× · if it fails you keep about 88%.
The Verdict
We rate AudioEye Neutral. It is a mixed business: recurring sales growing about 12% a year with high margins, sold mainly through a strong partner channel, but in a product category advocates and a regulator distrust. After the shares nearly doubled in three days, the price is full: it asks for faster growth than revenue has shown. As a bet it is defensive: the new AI products could add a little, and most of today's value rests on the subscription business alone. We would look again if the price fell or growth sped up.
The long caseIf AI builds more of the web badly, someone has to check and fix it, and AudioEye already sits on those sites.
The evidence under this - 6 claims
- ARR is the company's own measure, not audited, and includes month-to-month plans (S01).
- Customers grew 6% while ARR grew 12%, so growth leans on price and upsell, not new logos.
- Revenue grew 7% in Q3 2026 and about 8% for the year guided (C03, C06), below 13.2%.
- ARR grew 12% (C04), close to the test, and management guides about 20% sequential growth for Q4 alone.
AudioEye sells expert audits and custom fixes beside its script (C01), which the fact sheet's argument does not address.
No revenue, pricing or customer count is disclosed for either product.
The company
Most websites have barriers a blind person using a screen reader, or someone who cannot use a mouse, cannot get past. In the US that can bring a lawsuit. AudioEye's software scans a site, fixes common barriers automatically, and keeps watching it. Larger clients also pay for expert audits, custom fixes and help if they are sued.
In October 2026 it added an AI agent that audits sites, and a tool that lets AI coding assistants write accessible code.
The evidence under this - 3 claims
- No outside body measures legal protection by vendor; the figure is the company's own.
- Overlay-style products are named in a rising share of suits (C26) and the FTC sanctioned a rival's compliance claim (C25).
No revenue, pricing or customer count is disclosed for either product.
How it makes money
Almost all of it is subscriptions, paid ahead. About 130,000 customers pay an average of about $333 a year. Small businesses arrive through website platforms, agencies and a marketplace, the faster-growing half; larger firms and governments buy directly, and that half is flat as one-off work is run down.
The evidence under this - 5 claims
- ARR is the company's own measure, not audited, and includes month-to-month plans (S01).
- Customers grew 6% while ARR grew 12%, so growth leans on price and upsell, not new logos.
Enterprise is 41% of ARR, so most customers pay far less than the average.
Where the money comes from, stream by stream
| Stream | Share of sales (FY2025) | How it earns it |
|---|---|---|
| Partner and Marketplace | 55% | Monthly and annual plans for small businesses, sold through hosting, website-builder and agency partners and AudioEye's own marketplace. |
| Enterprise | 45% | Larger firms and governments on custom contracts: automated fixes, audits, expert fixes and legal support, plus run-off one-time work. |
Who runs it
Kelly Georgevich, finance chief since 2021, became chief executive in May 2026. David Moradi, the previous chief executive, is now executive chairman and runs product; he owns about a fifth of the company, and directors and officers together about a quarter. Insiders bought shares in the open market this year and sold none. The chief executive's bonus targets are not disclosed.
The evidence under this - 4 claims
Why it wins, and who could beat it
Why customers come back
Its advantage is how it reaches buyers. Website platforms and partners put AudioEye in front of small businesses that would never hire a consultant, at a price they barely notice. That channel grew 14% in the latest quarter. But it leans on a few partners, one of them 13% of sales, and nothing stops a partner offering a rival's tool instead.
The evidence under this - 4 claims
- ARR is the company's own measure, not audited, and includes month-to-month plans (S01).
- Customers grew 6% while ARR grew 12%, so growth leans on price and upsell, not new logos.
Enterprise is 41% of ARR, so most customers pay far less than the average.
The threat
The FTC fined accessiBe, a rival selling a similar automatic fix, for claiming it made any site compliant. Disability advocates list AudioEye among these tools and say none can do the whole job. Level Access, a private rival, now sells the same bundle. AI coding tools could also write accessible sites from the start, though management says it sees little of that yet.
The evidence under this - 4 claims
AudioEye sells expert audits and custom fixes beside its script (C01), which the fact sheet's argument does not address.
- Level Access bought UserWay to combine automated fixes with audits (C31), and accessiBe still sells.
- The company's own 10-K says AI may intensify competition and reduce demand (C32).
The rivals: all private, in-house or listed abroad.
Who else does this, rival by rival
| Ticker | Rival | Where it competes | How far along | Priced against it |
|---|---|---|---|---|
| Private | accessiBePriced against it: Private | Accessibility subscriptions: automated fixes, monitoring, audits and legal support | On sale | Private |
| Private | Level Access with UserWayPriced against it: Private | Accessibility subscriptions: automated fixes, monitoring, audits and legal support | On sale | Private |
| Not listed | Accessibility consultants and developers fixing the site's own codePriced against it: Not listed | Accessibility subscriptions: automated fixes, monitoring, audits and legal support | On sale | Not listed |
| In-house | AI coding tools and site builders that write accessible code themselvesPriced against it: In-house | AI products: Agentic Audits and the SDK MCP | In research | In-house |
How big it could get
How big this could get
The US has about 8 million businesses with employees. If each paid what AudioEye's average customer pays, that is about $2.7B a year, and AudioEye serves under 2% of that count. Almost every site needs the work: an outside survey found failures on 96% of the top million home pages. Europe, governments and the AI products would come on top.
The evidence under this - 3 claims
- One customer can run many sites and many establishments share one site, so customers and establishments are not the same unit.
- The average hides a few large enterprise contracts and many cheap marketplace plans.
The results
The numbers
Sales grew 8.1% over the twelve months to Sep 2026, slower than the 15% in the year to Dec 2025.
Operating margin is −4.8%, up from −19% in the year to Dec 2023.
Running costs take 85¢ of each sales dollar, down from 138¢ in the year to Dec 2021.
Shareholders' money lost 57% a year, up from −113% in the year to Dec 2021.
It turned 15% of sales into free cash, $6.51M over the last twelve months.
It owes $6.90M more than the cash it holds, about 1.1 years of the cash its operations bring in.
The share count rose 17% in 4.8 years, and pay in shares costs 12% of sales.
All the numbers
Filed figures from the company's 10-K and 10-Q, read 2026-10-30. Fiscal years end in December.
| Dec 2021 | Dec 2022 | Dec 2023 | Dec 2024 | Dec 2025 | 12 mo to Sep 2026 | |
|---|---|---|---|---|---|---|
| Size and growth | ||||||
| Sales | $24.5M | $29.9M | $31.3M | $35.2M | $40.3M | $42.7M |
| Sales growth | +20% | +22% | +4.7% | +12% | +15% | +8.1% |
| Profit | ||||||
| Gross margin | 75% | 76% | 78% | 79% | 78% | 80% |
| Operating margin | −63% | −35% | −19% | −9.6% | −4.5% | −4.8% |
| Net margin | −58% | −35% | −19% | −12% | −7.6% | −7.1% |
| What growth costs, per sales dollar | ||||||
| Research and development | 22% | 20% | 22% | 14% | 11% | 9.3% |
| Sales and marketing | 60% | 46% | 38% | 36% | 37% | 34% |
| General and admin | 57% | 45% | 37% | 38% | 38% | 41% |
| Pay in shares | 31% | 15% | 12% | 13% | 12% | 12% |
| Capital spending | 0.3% | 0.2% | 0.5% | 0.4% | 0.1% | 0.1% |
| Cash | ||||||
| Cash from operations | −$4.98M | −$5.00M | $318K | $2.73M | $4.75M | $6.57M |
| Free cash flow | −$5.06M | −$5.07M | $147K | $2.60M | $4.70M | $6.51M |
| Balance sheet | ||||||
| Cash and short-term investments | $19.0M | $6.90M | $9.24M | $5.65M | $5.29M | $9.33M |
| Debt | $0 | $0 | $6.73M | $6.82M | $13.0M | $16.2M |
| Net cash | $19.0M | $6.90M | $2.51M | −$1.17M | −$7.69M | −$6.90M |
| Returns and shares | ||||||
| Shares (diluted) | 11.0M | 11.5M | 11.8M | 11.9M | 12.4M | 13.0M |
What growth costs
Sales grew from $24.5M in 2021 to $40.3M in 2025 while costs stayed nearly flat, so the loss shrank year by year. Most of each new dollar of sales is kept. Pay in shares is still large, about 12% of sales.
The evidence under this - 4 claims
Capitalising $0.4M of R&D a quarter moves cost off the income statement without cutting it.
The last report (26 Oct)
Quarter ended September 2026, filed figures.
In the third quarter of 2026 sales rose 7% to $11.0M and AudioEye made a profit of $1.0M, its first. Costs fell while sales grew, and management credits using AI in its own work.
Recurring sales, the yearly value of all subscriptions, grew faster, 12% to $43.3M. Legal costs halved from the quarter before, and management expects them to fall again. It narrowed its revenue forecast for the year to $43.6M to $43.8M.
What it did to the thesisIt proved costs can fall while sales grow, which is what the shares now pay for. It did not show faster growth: revenue still trails recurring sales, and legal costs remain the largest thing management adds back.
The quarter in detail
Sales growth from the previous quarter, filed figures.
Earnings per share $0.30 against $0.27 expected; $0.08 as filed, the gap being what the company adds back.
The evidence under this - 5 claims
- ARR is the company's own measure, not audited, and includes month-to-month plans (S01).
- Customers grew 6% while ARR grew 12%, so growth leans on price and upsell, not new logos.
- The FY2026 revenue range opened at $43M to $44.5M in March (C07); the narrowed range sits below its midpoint.
- The EBITDA raise is adjusted, after adding back litigation that recurs (C38).
Capitalising $0.4M of R&D a quarter moves cost off the income statement without cutting it.
Nine-month litigation expense still rose 76% (C08), and the case is not described in any filing (S04).
What management did with the money
It bought a smaller rival for about $7.0M in 2024 with borrowed money, and now plans to buy back up to $15M of shares by October 2027. The lender changed the loan terms to allow it, as long as at least $5.0M of cash and credit stays available.
Insiders in 2026Q3: 5 purchases and 3 sales, from their Form 4 filings.
The evidence under this - 3 claims
Cash of $9.3M less the $5.0M liquidity floor (C11) leaves about $4.3M to spend today.
The price, and where we disagree
In short. Full. The price pays for growth faster than revenue has shown, from a business that only just turned a profit.
The shares fell from $33.64 in late 2024 to $5.40 in March 2026, then nearly doubled in three days after the latest report. The question is whether the business changed as much as the price.
Demand keeps rising: website accessibility lawsuits grew 27% in 2025, Hawaii passed the first state law covering all private businesses, and US government websites must comply from April 2027. The next test is the full-year report in March 2027.
The evidence under this - 5 claims
The count excludes state courts and demand letters, so it understates the pressure (S12).
The rules are not final, and no other state has passed one.
- The FY2026 revenue range opened at $43M to $44.5M in March (C07); the narrowed range sits below its midpoint.
- The EBITDA raise is adjusted, after adding back litigation that recurs (C38).
How we read the multiple
With its debt and net of cash, the company costs about $186M. What has to be true:
1. Revenue over the last four quarters was $42.7M, so the price is about 4.4 times sales. 2. A buyer wanting 9% a year, a common yardstick, sells at 3 times sales in ten years. 3. That needs revenue to grow about 13% a year for a decade, against 7% in the latest quarter.
It still lost $2.0M over the last four quarters under accounting rules.
Against its own history. Buyers now pay more per dollar of sales than they usually have, because the market has started paying for profit rather than only for growth.
The evidence under this - 3 claims
- Revenue grew 7% in Q3 2026 and about 8% for the year guided (C03, C06), below 13.2%.
- ARR grew 12% (C04), close to the test, and management guides about 20% sequential growth for Q4 alone.
Management expects it to keep falling (C37); if it ends, the gap closes.
Priced against its rivals
Its rivals have not yet been checked against their own filings, so there is no group to price it against; the price is judged against its own history instead.
The bet: what it pays if it works
The bet is on AudioEye's new AI products: an agent that audits websites and a tool for AI coding assistants. Neither has disclosed sales.
Valued at a fair price, the subscription business alone accounts for most of today's price. If the AI products sell to about one customer in twenty, they add only a little, so the bet is expensive. If they sell nothing, shareholders keep most of what they hold.
| AI products: Agentic Audits and the SDK MCP revenue in two to three years | Customers paying for an AI add-on needed | At the stated multiple |
|---|---|---|
| $500,000 | about 1.5K at 100% kept | 0.9× |
| $2.00M (the big win) | about 6.0K at 100% kept | 0.9× |
| $5.00M | about 15.0K at 100% kept | 1.0× |
To pay 2× (a Fair bet) it would need about $51.94M of AI products: Agentic Audits and the SDK MCP revenue (about 156.0K customers paying for an AI add-on); to pay 5× (a Cheap bet), about $191.72M of AI products: Agentic Audits and the SDK MCP revenue (about 575.7K customers paying for an AI add-on), at the same multiple.
Each row is AI products: Agentic Audits and the SDK MCP alone, plus the rest of the company (Accessibility subscriptions: automated fixes, monitoring, audits and legal support) counted at about $165.00M.
The steps it has to take
- Done Agentic Audits and the SDK MCP launched
- Not started First revenue or customer count disclosed for the AI products due 2027-03-04
- Not started ARR growth above 15%, the pace an add-on would show due 2027-12-31
The detail behind the label
The evidence under this - 5 claims
No revenue, pricing or customer count is disclosed for either product.
Enterprise is 41% of ARR, so most customers pay far less than the average.
- Level Access bought UserWay to combine automated fixes with audits (C31), and accessiBe still sells.
- The company's own 10-K says AI may intensify competition and reduce demand (C32).
- Revenue grew 7% in Q3 2026 and about 8% for the year guided (C03, C06), below 13.2%.
- ARR grew 12% (C04), close to the test, and management guides about 20% sequential growth for Q4 alone.
Where we disagree with the market
AudioEye is an AI-driven profit story: earnings growing fast, a buyback, and a stock still cheap on adjusted profit.
The profit gain is real, but the price asks for faster growth than revenue shows, and the advantage is a sales channel, not a protected product.
Analysts are uniformly positive and the stock has jumped twice this year on profit. But the adjusted profit leaves out legal costs every quarter, and revenue grew only 7%. We could be wrong if recurring sales speed up or the AI products start selling quickly.
What analysts say, and the evidence
The evidence under this - 5 claims
The panel shrank from five to three while the positive share rose, so coverage left rather than conviction arrived.
- Revenue grew 7% in Q3 2026 and about 8% for the year guided (C03, C06), below 13.2%.
- ARR grew 12% (C04), close to the test, and management guides about 20% sequential growth for Q4 alone.
Management expects it to keep falling (C37); if it ends, the gap closes.
AudioEye sells expert audits and custom fixes beside its script (C01), which the fact sheet's argument does not address.
What could go wrong, and how we would know
The risks
- One partner is big One partner was 13% of 2025 sales; losing or repricing it would cut growth at once.
- Regulators distrust automatic fixes The FTC fined a rival for overstating what such fixes do, and advocates name AudioEye among those tools.
- An undisclosed lawsuit Legal costs were large all year, and management will not describe the case behind them.
- Debt on a small company It owes more than it holds in cash, and buybacks would spend cash the loan rules watch.
- A violent stock The shares have halved and doubled within two years, so the price can move far on one report.
The evidence under this - 6 claims
AudioEye sells expert audits and custom fixes beside its script (C01), which the fact sheet's argument does not address.
Nine-month litigation expense still rose 76% (C08), and the case is not described in any filing (S04).
What we still do not know
- What the active lawsuit is about, who brought it, and what it could cost.
- Whether AudioEye's customers are sued less than sites with no tool at all.
- How the AI products are priced and how many customers have bought them.
The evidence under this - 3 claims
Nine-month litigation expense still rose 76% (C08), and the case is not described in any filing (S04).
- The copy is a remediation firm that competes with overlays, and UsableNet's own report was reached only through it.
- The count does not separate AudioEye's customers from accessiBe's or UserWay's.
No revenue, pricing or customer count is disclosed for either product.
What would change our view
- Neutral→AttractiveA price that asks only for today's growth
It needs all of:
- ○The company is valued at 3 times the last year's sales, with recurring sales still growing.about ≈$9.72 today, 31% below the last close
- ○Recurring sales grow 10% or more from a year earlier at the next quarter-end.checked at the next results, due by 4 Mar
- Neutral→AttractiveProof the growth and the profit are real
It needs all of:
- ○Recurring sales grow 15% or more from a year earlier in a 2027 quarter.checked at the next results, due by 4 Mar
- ○Profit under accounting rules reaches a tenth of sales over four quarters, legal costs included.checked at the next results, due by 4 Mar
We would also be wrong if
- A court or regulator finds AudioEye's automatic fixes or legal-protection claims misleading.
- Legal costs top $2M in any half of 2027.
- The partner that was 13% of sales leaves or cuts its contract.
What is coming
- 4 March 2027 Q4 2026 results: Whether revenue lands at $11.4M or more, ARR keeps its 12% growth and litigation falls as promised.
Every dated event ahead
- 4 March 2027 Q4 2026 results: Whether revenue lands at $11.4M or more, ARR keeps its 12% growth and litigation falls as promised.
- 26 April 2027 Justice Department deadline for large state and local governments: Whether government demand shows up in Enterprise revenue.
- 18 October 2027 End of the $15M buyback authorisation: How many shares were actually bought back with the cash the business made.
Since we wrote this
- 30 OctThesis writtenNeutral, low convictionWritten four days after the Q3 2026 results, after the shares rose from $7.42 to $14.12 in three sessions.
Sources 17
Sources - 17
Every claim above cites one of these, or states the reasoning that derived it. The quote is frozen at the date it was read: a link can rot, and an agent fetch returns a reading of a page rather than the page. Backs counts the whole claim ledger, so it can name a claim this page does not surface.
- S01primarycompany filing2026-03-12business description, channels, customer concentration, competition, legal framework, the term loan, acquisitions, revenue by channel, employeesbacksC01C02C05C09C13C21C32C33C35C38C39
- S02primarycompany release2026-03-05FY2025 results and the first FY2026 guide
AudioEye expects revenue of between $10.5M and $10.6M for the first quarter of 2026 and between $43M and $44.5M for the full year 2026.
backsC02C07C28C43 - S03primarycompany release2026-10-26Q3 2026 results, ARR, customers, the new AI products, the Q4 guide and the adjusted EBITDA reconciliation
ARR as of September 30, 2026 increased sequentially to $43.3M from $42.3M as of June 30, 2026.
backsC03C04C06C08C12C29C30C34C38C40C42C43 - S04primarycompany filing2026-10-26revenue by channel, the balance sheet, the term loan and its two amendments, the buyback, deferred revenue, the share count, the May executive changesbacksC01C03C09C10C11C12C13C15C20C35C39C43
- S05primarytranscript2026-10-26ARR by channel, litigation expense trend, the AI products, the studies, Hawaii's law, analyst questions on AI rivals and the buyback
Our solution already delivers 3 to 4x the legal protection of others.
backsC04C06C28C29C30C34C36C37C45 - S06primarytranscript2026-08-13Q2 adjusted EBITDA, the litigation answer, the new finance chief
We cannot comment any further on active litigation, but I think you can expect a significant additional cash generation with litigation trending down in second half of 2026
backsC15C37C44 - S07primarytranscript2026-03-05the FY2026 plan and the reason for the lighter revenue guide
We do anticipate higher ARR growth in this, so kind of low to mid-teens on the ARR side.
read, but no claim rests on it - S08primarycompany filing2026-05-13beneficial ownership, directors' records, the May 2026 employment agreements and paybacksC14C15C16
- S09secondaryvendor data2026-10-30Research pack (FMP market tier, FINRA short interest, Form 4 feed), frozen at content/AEYE/research-pack.jsoncontent/AEYE/research-pack.jsondaily closes, the analyst split and its series, insider trades, short interestbacksC07C17C18C19C20C44
- S10primaryregulator2025-04-22FTC, 'FTC Approves Final Order Requiring accessiBe to pay $1 Million' Federal Trade Commissionthe regulator's finding on an automated plug-in's compliance claims
accessWidget did not make all user websites WCAG-compliant and these claims were false, misleading, or unsubstantiated.
backsC25 - S11primaryindustry data2026-03-31WebAIM, 'The WebAIM Million: The 2026 report on the accessibility of the top 1,000,000 home pages' WebAIM, Utah State Universitythe share of the web that fails, and errors per page
95.9% of home pages had detected WCAG 2 failures. This number increased from 94.8% in 2025
backsC24 - S12primaryindustry data2026-03-01Seyfarth Shaw, ADA Title III blog, 'Federal Court Website Accessibility Lawsuit Filings Bounce Back in 2025' Seyfarth Shaw LLPthe federal lawsuit count by year
Plaintiffs filed 3,117 website accessibility lawsuits in federal court in 2025 - a 27% increase from 2024.
backsC23 - S13primaryregulator2026-04-20Federal Register, 'Extension of Compliance Dates for Nondiscrimination on the Basis of Disability; Accessibility of Web Information and Services of State and Local Government Entities' (2026-07663) US Department of Justicethe new government website deadlines
The compliance date for State and local government entities with a total population of 50,000 or more is extended from April 24, 2026, to April 26, 2027.
backsC22 - S14primarygovernment data2024-02-01US Census Bureau, '2022 Economic Census First Look' US Census Bureauthe number of US employer establishments
In 2022, the number of establishments with paid employees increased to just over 8.0 million
backsC40C41 - S15primaryother2026-10-30Overlay Fact Sheet (signed by accessibility practitioners and users) Overlay Fact Sheet signatoriesadvocates' position on overlays, and the list naming AudioEye
While the use of an overlay may improve compliance with a handful of provisions in major accessibility standards, full compliance cannot be achieved with an overlay.
backsC27 - S16secondaryother2026-01-15Accessibility.Works, 'Accessibility Overlay Widgets Attract Lawsuits' (citing UsableNet's 2025 report) Accessibility.Worksthe share of suits naming overlay sites
According to UsableNet’s 2025 report, 28% (up from 25% in 2024) of all digital accessibility lawsuits targeted websites using these overlays
backsC26 - S17primarycompany release2024-03-20Level Access, 'Level Access Completes Acquisition of UserWay' Level Access (private)a rival combining audits with automated fixes
Level Access, the leading provider of digital accessibility solutions, has completed its acquisition of UserWay, a pioneer in accessibility AI technologies.
backsC31