The digital privacy revolution is picking up speed, and companies and governments alike are scrambling to keep up. As the world barrels toward a future where biometric data, digital identities, and privacy-centric marketing platforms are the norm, recent developments across the tech landscape are shaping a new era—one where the balance between convenience, security, and personal privacy is more delicate than ever.
On August 9, 2025, System1, Inc. (SST) delivered its Q2 2025 earnings, revealing both the challenges and opportunities facing companies in the privacy-first digital economy. According to AInvest, total revenue for the quarter dropped 17% year-over-year to $78.1 million. But the story isn’t just about shrinking numbers. The company’s product segment, which includes well-known platforms like Startpage, MapQuest, and CouponFollow, surged 34% year-over-year. This marked increase signals a strategic pivot: System1 is moving away from the unpredictable world of marketing-driven revenue and toward a more sustainable, product-centric approach.
Adjusted EBITDA for System1 rose 18% to $11.7 million, and adjusted gross profit climbed 6% to $41 million, even as the company posted a net loss of $21.5 million. Yet, with $63.6 million in unrestricted cash at the end of the quarter, System1 demonstrated operational resilience and a capacity to weather volatility. Investors responded in kind, driving the company’s stock up 12.4% after the earnings announcement.
At the core of System1’s transformation is its Responsive Acquisition Marketing Platform (RAMP), which CEO Michael Blend describes as a “high-margin, cash-generative” engine. Unlike traditional ad tech, which often relies on invasive third-party tracking, RAMP is built around first-party data and artificial intelligence. It optimizes ad campaigns while respecting user privacy—an approach that’s not only ethically sound but increasingly demanded by both regulators and consumers. System1’s platforms are reaping the benefits: Startpage, the company’s privacy-focused search engine, saw a 25% jump in daily active users in June 2025 compared to the previous year, and CouponFollow enjoyed a 44% year-over-year increase in organic sessions.
System1’s strategic emphasis on privacy is paying off in more ways than one. By reducing operating expenses by 17% year-over-year and leveraging RAMP’s omni-channel capabilities, the company is diversifying its revenue streams and establishing itself as a resilient player in a fragmented market. As Google’s Privacy Sandbox and the European Union’s Digital Services Act reshape the digital advertising landscape, System1’s first-party data model offers advertisers a compliant alternative to third-party tracking. Blend’s focus on RAMP’s scalability and adaptability is validated by the product segment’s 32% adjusted gross profit growth in Q2.
Still, risks remain. System1’s reliance on its volatile marketing segment and a high beta of 1.38 make it sensitive to market swings. The company’s decision to withhold specific financial guidance, citing uncertainties in the Google ecosystem, introduces short-term unpredictability. Nonetheless, the long-term outlook appears bright. With a robust cash reserve and a platform built for privacy compliance, System1 is well-positioned to capture market share as demand for privacy-centric solutions grows.
Meanwhile, the broader world of digital identity and biometrics is undergoing its own transformation. On August 9, 2025, Biometric Update reported significant advances in biometric data privacy at both the policy and technology levels. Mastercard and the National Institute of Standards and Technology (NIST) have thrown their support behind digital wallets that store mobile driver’s licenses (mDLs), viewing them as a safer way to provide biometric assurance without the risks of older systems. NIST’s updated Digital Identity Guidelines (SP 800-63 Revision 4) now include digital wallets, passkeys, alternatives to face biometrics, and explicit guidance on managing deepfake risks.
The market for deepfake detection is booming. According to the 2025 Deepfake Detection Market Report & Buyer’s Guide, nearly $5 billion in revenue is expected from 9.9 billion deepfake detection checks by 2027. This surge reflects growing concern about the misuse of facial images and voices for fraud, and the urgent need for robust detection and protection tools.
Countries around the globe are responding to these challenges with new frameworks and regulations. New Zealand is forging ahead with its digital identity system, preparing to tender for a trust framework registry provider and develop the Digital Identity Services Trust Framework Rules, with a request for proposals (RFP) expected by the end of August 2025. The country’s new biometric data privacy code, combined with this framework, aims to establish broad security and privacy protections for digital identity systems.
In Australia, EY is halfway through delivering five solutions for the Australian Government Digital Identity System (AGDIS), designed to reduce the sharing of personal data. The contract, already extended once, is under further negotiation, signaling the complexity and importance of these initiatives.
But not everyone is on board with the rapid expansion of biometric technologies. In the United States, the Transportation Security Administration’s (TSA) use of facial recognition at airports remains a lightning rod for controversy. Congressional debates over the Traveler Privacy Protection Act have divided lawmakers and drawn the TSA into the fray, with the agency defending the program’s privacy credentials and operational necessity. The act remains stalled in committee, highlighting the ongoing tension between security, convenience, and civil liberties.
Independent testing is crucial for building accountability in biometric systems. NIST continues to play a pivotal role, with its latest refresh of the Face Recognition Technology Evaluation (FRTE) showing ongoing improvements in accuracy. Temporarily, however, NIST has put its fingerprint, face, and iris biometrics benchmarking programs on hold for system upgrades—an important step to ensure future assessments remain robust.
The sensitivity of health data, too, is under the spotlight. The White House is partnering with dozens of health tech companies to build a national health data platform, a move that has drawn criticism from privacy advocates wary of potential risks. Age assurance and online data privacy are also hot topics in the European Union and United Kingdom, with new transparency requirements and fresh rounds of criticism—particularly regarding the UK’s Online Safety Act—sparking debate about the best ways to protect users, especially minors, online.
Indonesia is also making moves, planning a backup Automated Biometric Identification System (ABIS) contract starting in September 2025 and emphasizing the protection of biometric data centers. These efforts reflect a global consensus: as digital systems expand, so too must the frameworks that safeguard individuals’ most sensitive information.
Industry leaders are paying close attention. In a recent podcast, incoming and outgoing CEOs of Entrust discussed with Biometric Update how the digital identity market, credential lifecycles, and citizen services are all evolving. Their conversation underscored the complexity of the current environment, where innovation must be balanced with ever-increasing demands for privacy and security.
All told, the convergence of privacy-centric technology, evolving regulations, and shifting consumer expectations is ushering in a new digital era. Companies like System1 are betting that platforms built on trust and transparency will win out in the long run. As governments and industry leaders grapple with the challenges of biometric data, deepfakes, and digital identity, the stakes couldn’t be higher. The race to build a secure, privacy-first digital future is on—and there’s no going back.
