8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  May 7, 2009

I.D. SYSTEMS, INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	001-15087	22-3270799
(State Or Other	(Commission	(IRS Employer
Jurisdiction Of	File Number)	Identification No.)
Incorporation)
One University Plaza, Hackensack, NJ		07601
(Address of Principal Executive Offices)		(Zip Code)

Registrant's telephone number, including area code   (201) 996-9000

Check the  appropriate  box below if the Form 8-K filing is intended to simultaneously  satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written  communications  pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨  Pre-commencement  communications  pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨  Pre-commencement  communications  pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02.  Results of Operations and Financial Condition.

On May 7, 2009, I.D. Systems, Inc. (the “Registrant”) issued a press release regarding results for the quarter ended March 31, 2009.  A copy of this press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this report is being furnished pursuant to Item 2.02 of Form 8-K, insofar as it discloses historical information regarding the Registrant’s results of operations and financial condition as of, and for the quarter ended, March 31, 2009.  In accordance with General Instructions B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Forward Looking Statements

This Current Report on Form 8-K, including Exhibit 99.1, contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements typically are identified by use of terms such as “may,” “will,” “should,” “plan,” “expect,” “anticipate,” “estimate” and similar words, although some forward-looking statements are expressed differently. Forward-looking statements represent our management’s judgment regarding future events. Although the Registrant believes that the expectations reflected in such forward-looking statements are reasonable, the Registrant can give no assurance that such expectations will prove to be correct.  All statements other than statements of historical fact included in this Current Report on Form 8-K regarding our financial position, financial guidance, business strategy, products, markets, plans or objectives for future operations are forward-looking statements.  The Registrant cannot guarantee the accuracy of the forward-looking statements, and you should be aware that the Registrant’s actual results could differ materially from those contained in the forward-looking statements due to a number of factors, including the statements under the heading “Risk Factors” contained in the Registrant’s filings with the Securities and Exchange Commission.

Item 9.01.  Financial Statements and Exhibits.

(d)           Exhibits

As described above, the following Exhibit is furnished as part of this Current Report on Form 8-K:

Exhibit 99.1 – Press release dated May 7, 2009.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

I.D. SYSTEMS, INC.
By:	/s/ Ned Mavrommatis
	Name:  Ned Mavrommatis
	Title:   Chief Financial Officer

Date:  May 7, 2009

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EX-99.1

            Expanding the range of wireless solutions

FOR IMMEDIATE RELEASE	CONTACT:	Ned Mavrommatis, CFO
		201-996-9000; fax: 201-996-9144
		ned@id-systems.com

I.D. Systems, Inc. Reports First Quarter Financial Results

Hackensack, NJ, May 7, 2009—I.D. Systems, Inc. (NASDAQ: IDSY) today announced its financial results for the first quarter of 2009.  Revenues for the three months ended March 31, 2009, were $2.9 million, compared to $4.3 million for the three months ended March 31, 2008.  Gross margin increased to 54.2%, compared to 48.8% for the corresponding period in 2008.  Net loss for the quarter was $3.1 million, or ($0.28) per basic and diluted share, compared to net loss of $2.0 million, or ($.19) per basic and diluted share, for the first quarter of 2008.

Non-GAAP net loss for the first quarter of 2009 was $2.5 million, or ($0.23) per basic and diluted share, compared to non-GAAP net loss of $1.2 million, or ($0.11) per basic and diluted share, for the first quarter of 2008.  Non-GAAP results were calculated by adjusting GAAP net results for the impact of stock-based compensation, which was $559,000 for the first quarter of 2009 and $785,000 for the first quarter of 2008.  A table entitled “Reconciliation of GAAP to Non-GAAP Financial Measures” is included in this press release.

“With the global economy in recession, many organizations are slowing their technology acquisitions.  In the first quarter, this economic climate manifested itself in both our core customers and prospects in our sales pipeline,” said Jeffrey Jagid, I.D. Systems’ chairman and chief executive officer.  “The U.S. Postal Service’s spending cutbacks, in particular, affected our revenue this quarter.  However, we continue to aggressively pursue our primary strategic goals—diversifying our customer base and expanding our product applications.  To that end, we are trying to leverage our competitive advantages, including the effectiveness of our technology, our financial resources, and our proven experience delivering a significant return on investment for customers.  Our mission remains to drive rapid customer adoption and expansion of our solutions, open new applications and markets for our technology, maintain our technical and market leadership, and ultimately deliver shareholder value.”

Selling, general and administrative expenses for the three months ended March 31, 2009, were $4.2 million, including $430,000 in stock-based compensation, essentially flat compared to $4.3 million, including $649,000 in stock-based compensation, for the first quarter of 2008.  Research and development expenditures for the first quarter of 2009 decreased slightly to $689,000, including $115,000 in stock-based compensation, compared to $711,000, including $115,000 in stock-based compensation, for the corresponding period in 2008.  Interest income for the quarter was $347,000, compared to $826,000 for the same period in 2008.

“After holding the line on expenses in the first quarter, we took further cost-cutting actions in April, 2009, by trimming our workforce to save approximately $1 million annually,” said Mr. Jagid.  “These staff reductions were not in sales and marketing, however.  We continue to invest in growth opportunities, for both organic revenue generation and potential strategic acquisitions.”

As of March 31, 2009, I.D. Systems had $66.9 million in cash and marketable securities, and $22.3 million of working capital, compared to $56.0 million and $30.1 million, respectively, as of December 31, 2008.  The increase in cash is due primarily to the borrowing of $12.9 million from a line of credit facility.

Highlights of the first quarter ended March 31, 2009, included:

· The launch of I.D. Systems’ new PowerFleet™ brand wireless Vehicle Management System (VMS) for forklifts and other industrial equipment, which incorporates the company’s most powerful, versatile combination of software, hardware, and wireless technology to date, including a choice of client-server or browser-based software, a wide array of modular system functions and extensions, and a flexible combination of wireless communication options termed SecureStream™.

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· The deployment of the PowerFleet™ VMS on a fleet of industrial vehicles at the primary manu-facturing complex of Mercedes-Benz U.S., which was facilitated by I.D. Systems’ strategic marketing partner NACCO Materials Handling Group, Inc., a leading global industrial truck manufacturer, and Barloworld Handling, the world’s largest dealer of Hyster® brand lift trucks.

· The receipt of a blanket purchase order from Audi AG for the PowerFleet™ VMS to manage industrial vehicle fleets in the European manufacturing operations of both Audi and its corporate parent, Volkswagen, with initial deployment in two Audi production facilities.

· The selection of I.D. Systems’ AvRamp™ VMS by American Eagle Airlines to manage a fleet of aircraft ground support equipment at Dallas/Fort Worth International Airport, which represents the first large-scale implementation of AvRamp™ technology by a major U.S. airline to improve airport ground handling operations, increase the safety of the ramp area, reduce fleet costs, and enhance the airline’s customer service.

· The renewal of a corporate service agreement with Ford Motor Company to provide maintenance and support services for Ford’s enterprise-wide deployment of I.D. Systems’ VMS technology and associated industrial vehicle battery monitoring systems, which have been deployed in Ford plants throughout North America since 2003.

Investor Conference Call

I.D. Systems will hold a conference call for investors and analysts at 4:45 p.m. Eastern Time on May 7, 2009.  Jeffrey Jagid, chairman and CEO, will lead a discussion on the results of the quarter and recent developments.  After opening remarks, there will be a question and answer period.  The conference call will be broadcast live over the Internet via the Investors section of the company’s website at www.id-systems.com.  To listen to the live call, go to the website at least 10 minutes early to download and install any necessary audio software.

Non-GAAP Measures

To supplement its financial statements presented in accordance with GAAP, I.D. Systems provides certain non-GAAP measures of financial performance.  These non-GAAP measures include non-GAAP net income/loss and non-GAAP net income/loss per basic and diluted share.  Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results.  These non-GAAP measures are provided to enhance investors' overall understanding of I.D. Systems' current financial performance and provide further information for comparative information due to the adoption of accounting standard SFAS 123R.  Specifically, I.D. Systems believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results and business outlook.  Reconciliation to the nearest GAAP measure of all non-GAAP measures included in this press release can be found in the financial tables included in this press release.

About I.D. Systems

Based in Hackensack, New Jersey, with a European business office in Düsseldorf, Germany, I.D. Systems is a leading provider of wireless solutions for managing and securing high-value enterprise assets, including industrial vehicles, such as forklifts and airport ground support equipment, and rental vehicles.  The company’s patented technology, which utilizes radio frequency identification, or RFID, technology, addresses the needs of organizations to control, track, monitor and analyze their assets.  For more information, visit www.id-systems.com.

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“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, such as the Company’s outlook for 2009 financial results and prospects for additional customers and revenues.  Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.  All statements other than statements of historical fact are statements that could be forward-looking statements.  These forward-looking statements are subject to risk and uncertainties, including, but not limited to, future economic and business conditions, the loss of any of the Company’s key customers or reduction in the purchase of its products by any such customers, the failure of the market for the Company’s products to continue to develop, the inability to protect the Company’s intellectual property, the inability to manage the Company’s growth, the effects of competition from a wide variety of local, regional, national and other providers of wireless solutions and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K for the year ended December 31, 2008. These risks could cause actual results to differ materially from those expressed in any forward looking statements made by, or on behalf of, the Company. The Company assumes no obligation to update the information contained in this press release.

-- Tables to Follow --

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I.D. Systems, Inc.

GAAP Condensed Operations Data

(Unaudited)

	Three months ended
	March 31,
	2008			2009
Revenue:
Products	$	3,253,000		$	1,378,000
Services		1,075,000			1,556,000
		4,328,000			2,934,000
Cost of Revenue:
Cost of products		1,536,000			798,000
Cost of services		680,000			547,000
		2,216,000			1,345,000
Gross Profit		2,112,000			1,589,000
Selling, general and administrative expenses		4,261,000			4,211,000
Research and development expenses		711,000			689,000
Loss from operations		(2,860,000	)		(3,311,000	)
Interest income		826,000			347,000
Other income		--			(108,000	)
Net loss	$	(2,034,000	)	$	(3,072,000	)
Net loss per share – basic and diluted	$	(0.19	)	$	(0.28	)
Weighted average common shares outstanding – basic and diluted		10,881,000			10,895,000

I.D. Systems, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

	Three Months Ended March 31,
	2008			2009
Net loss attributable to common  stockholders	$	(2,034,000	)	$	(3,072,000	)
Stock-based compensation		785,000			559,000
Non-GAAP net loss	$	(1,249,000	)	$	(2,513,000	)
Non-GAAP net loss per share – basic and diluted	$	(0.11	)	$	(0.23	)

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I.D. Systems, Inc.

Condensed Balance Sheet Data

	December 31, 2008*			March 31, 2009
				(Unaudited)
ASSETS
Cash and cash equivalents	$	12,558,000		$	18,848,000
Restricted cash		230,000			53,000
Investments – short term		8,550,000			7,054,000
Accounts receivable, net		8,245,000			5,483,000
Unbilled receivables		168,000			200,000
Inventory, net		3,273,000			4,488,000
Interest receivable		217,000			185,000
Prepaid expenses and other current assets		261,000			330,000
Total current assets		33,502,000			36,641,000
Investments – long term		34,911,000			40,950,000
Fixed assets, net		1,050,000			1,110,000
Goodwill		200,000			200,000
Other Intangible Assets		178,000			178,000
Other assets		107,000			107,000
	$	69,948,000		$	79,186,000
LIABILITIES
Accounts payable and accrued expenses	$	2,175,000		$	826,000
Line of Credit		-			12,740,000
Deferred revenue		424,000			822,000
Total current liabilities		2,599,000			14,388,000
Deferred revenue		231,000			308,000
Deferred rent		33,000			28,000
Total liabilities		2,863,000			14,724,000
STOCKHOLDERS' EQUITY
Preferred stock; authorized 5,000,000 shares, $.01 par value; none issued		--			--
Common stock; authorized 50,000,000 shares, $.01 par value; 12,082,000 and 12,122,000 shares issued at December 31, 2008 and   March 31, 2009, respectively, shares outstanding, 10,893,000 and 10,913,000 at December 31, 2008 and March 31, 2009, respectively.		120,000			120,000
Additional paid-in capital		101,437,000			101,996,000
Accumulated deficit		(23,667,000	)		(26,739,000	)
Accumulated other comprehensive income		46,000			1,000
		77,936,000			75,378,000
Treasury stock; 1,189,000 shares and 1,209,000 shares at cost at December 31, 2008 and March 31, 2009, respectively		(10,851,000	)		(10,916,000	)
Total stockholders’ equity		67,085,000			64,462,000
Total liabilities and stockholders’ equity	$	69,948,000		$	79,186,000

*Derived from audited balance sheet as of December 31, 2008.

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I.D. Systems, Inc.

Condensed Cash Flow Data

(Unaudited)

	Three months ended March 31,
	2008			2009
Cash flows from operating activities:
Net loss	$	(2,034,000	)	$	(3,072,000	)
Adjustments to reconcile net loss to cash  provided by (used in) operating activities:
Accrued interest income		24,000			32,000
Stock-based compensation expense		785,000			559,000
Depreciation and amortization		140,000			138,000
Change in fair value of investments		--			108,000
Deferred rent expense		(5,000	)		(5,000	)
Deferred revenue		(50,000	)		475,000
Changes in:
Restricted Cash		--			177,000
Accounts receivable		(523,000	)		2,762,000
Unbilled receivables		(1,271,000	)		(32,000	)
Inventory		831,000			(1,215,000	)
Prepaid expenses and other assets		87,000			(69,000	)
Accounts payable and accrued expenses		(1,565,000	)		(1,414,000	)
Net cash  used in operating activities		(3,581,000	)		(1,556,000	)
Cash flows from investing activities:
Purchase of fixed assets		(40,000	)		(198,000	)
Purchase of investments		(2,350,000	)		(16,474,000	)
Maturities of investments		19,692,000			11,778,000
Net cash provided by (used in) investing activities		17,302,000			(4,894,000	)
Cash flows from financing activities:
Repayment of term loan		(19,000	)		--
Proceeds from exercise of stock options		7,000			--
Purchase of treasury shares		(2,310,000	)		--
Borrowing on Line of Credit		--			12,900,000
Principal Payments on Line of Credit		--			(160,000	)
Net cash (used in) provided by financing activities		(2,322,000	)		12,740,000
Net increase in cash and cash equivalents		11,399,000			6,290,000
Cash and cash equivalents - beginning of period		5,103,000			12,558,000
Cash and cash equivalents - end of period	$	16,502,000			18,848,000
Supplemental disclosure of cash flow information:
Cash paid for:
Interest	$	--		$	--
Noncash activities:
Unrealized loss on investments	$	(1,034,000	)	$	(45,000	)
Shares withheld pursuant to stock issuance	$	424,000		$	65,000

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