SoundThinking(SSTI) - 2024 Q3 - Quarterly Report

Revenue Performance - Revenues for the three months ended September 30, 2024, were $26.3 million, a 10$24.0 million in the same period of 2023[87]. - For the nine months ended September 30, 2024, revenues reached $78.6 million, an 18$66.7 million in 2023[88]. - Revenues generated within the United States accounted for 99% of total revenues for both Q3 2024 and Q3 2023[89]. - Revenues for the three months ended September 30, 2024, increased by $2.3 million to$26.25 million, a 9% increase compared to $23.98 million in the same period of 2023[120]. - Revenues increased by$11.9 million to $78.6 million for the nine months ended September 30, 2024, representing an 18$66.7 million in 2023[127]. Revenue Sources - ShotSpotter revenues represented approximately 65% of total revenues for Q3 2024, down from 69% in Q3 2023[87]. - The City of New York and the City of Chicago accounted for 23% and 11% of total revenues, respectively, for the three months ended September 30, 2024[87]. Profitability and Loss - The company reported a net loss of $1.4 million for the three months ended September 30, 2024, compared to a net loss of$1.9 million in the same period of 2023[91]. - The net loss for the three months ended September 30, 2024, was $1.44 million, a reduction of$0.43 million compared to a net loss of $1.87 million in the same period of 2023[120]. - Operating loss improved by$1.6 million, decreasing to $4.1 million from$5.6 million, reflecting a 28% reduction in losses[127]. - Net loss narrowed by $1.3 million to$5.1 million, representing 6% of revenues, compared to 10% in the prior year[127]. Expenses - Cost of revenues rose by $0.8 million to$10.98 million, primarily due to increased product costs associated with a growing customer base[122]. - Operating expenses totaled $16.26 million, an increase of$1.03 million, with sales and marketing expenses rising by $0.89 million due to higher personnel costs[120][125]. - Research and development expenses increased by$0.2 million, driven by an increase in headcount to support product development initiatives[123]. - Total operating expenses rose by $6.9 million to$50.2 million, accounting for 64% of revenues, compared to 65% in 2023[127]. - Sales and marketing expenses increased by $2.0 million to$21.6 million, primarily due to higher personnel costs[130]. - Research and development expenses grew by $1.5 million to$10.4 million, largely attributed to increased headcount from the SafePointe acquisition[131]. Cash Flow and Financial Position - Cash provided by operating activities increased significantly by $12.4 million to$23.1 million, driven by a $13.4 million increase in deferred revenue[146][148]. - As of September 30, 2024, the company had cash and cash equivalents of$15.3 million and accounts receivable of $25.9 million, with an available credit facility of$21.0 million[137]. Market Presence and Expansion - The number of net new "go-live" cities and universities was 3 for Q3 2024, down from 7 in Q3 2023[96]. - ShotSpotter went live in four new cities and one university, expanding its presence and services during the quarter[121]. - The company plans to expand its international presence and has secured a three-year agreement to double ShotSpotter coverage in Montevideo, Uruguay[94]. - As of September 30, 2024, ShotSpotter had coverage areas under contract for 1,193 square miles, with 1,187 square miles live[82]. - The company had 218 SafePointe lanes under contract as of September 30, 2024[82]. Risk Factors - No material changes in market risk were reported during the nine months ended September 30, 2024, compared to the previous disclosures[156]. - Market risk exposure is primarily due to fluctuations in interest rates, foreign exchange rates, and inflation[155]. Share Repurchase - The company repurchased 418,940 shares at an average price of $14.31 per share for approximately$6.0 million under the stock repurchase program[143].