Smith Micro Software(SMSI) - 2025 Q1 - Quarterly Results

Business and Operational Highlights Smith Micro focused on advancing product development in Q1 2025, expanding mobile operator engagement and preparing for the launch of its next-generation family safety platform - The company is executing initiatives with a sharpened focus on its latest product developments: SafePath OS™ for kids and senior phones, and SafePath Kids™ for child-friendly rate plans[2] - Extensive discussions with current and prospective mobile operators, combined with product innovations, have expanded the company's reach and opened new sales opportunities[2] - The upcoming launch of SafePath 8 is expected to deliver the next generation of features and functionality for digital family safety[3] First Quarter 2025 Financial Performance Q1 2025 revenue decreased to $4.6 million from $5.8 million year-over-year, while GAAP net loss significantly narrowed to $5.2 million due to the absence of a goodwill impairment charge Q1 2025 vs Q1 2024 Key Financial Metrics (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $4,621 | $5,798 | | Gross Profit | $3,363 | $3,810 | | Gross Margin | 72.8% | 65.7% | | GAAP Net Loss | $(5,178) | $(31,007) | | GAAP Loss per Share | $(0.28) | $(3.28) | | Non-GAAP Net Loss | $(2,863) | $(4,200) | | Non-GAAP Loss per Share | $(0.16) | $(0.45) | - All share and per-share amounts have been retroactively adjusted to reflect a one-for-eight reverse stock split, effective April 10, 2024[5] Financial Statements The consolidated financial statements for Q1 2025 show total assets of $43.4 million, a net loss of $5.2 million, and an ending cash balance of $2.3 million Consolidated Balance Sheets As of March 31, 2025, total assets decreased to $43.4 million from $48.0 million, driven by lower cash and accounts receivable, with total stockholders' equity declining to $36.6 million Key Balance Sheet Items (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $2,288 | $2,808 | | Accounts receivable, net | $3,238 | $5,721 | | Total Assets | $43,364 | $48,046 | | Total Liabilities | $6,802 | $7,290 | | Total Stockholders' Equity | $36,562 | $40,756 | Consolidated Statements of Operations Q1 2025 revenues were $4.6 million, with significantly lower operating expenses of $8.6 million due to the absence of a goodwill impairment charge, resulting in a net loss of $5.2 million Q1 Statement of Operations Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $4,621 | $5,798 | | Gross Profit | $3,363 | $3,810 | | Total operating expenses | $8,573 | $35,256 | | Goodwill impairment | $0 | $23,989 | | Operating loss | $(5,210) | $(31,446) | | Net loss | $(5,178) | $(31,007) | | Loss per share | $(0.28) | $(3.28) | Consolidated Statements of Cash Flows Net cash used in operating activities improved to $0.6 million in Q1 2025, resulting in a $0.5 million decrease in cash and cash equivalents, ending the period at $2.3 million Q1 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(602) | $(1,345) | | Net cash (used in) provided by investing activities | $(4) | $194 | | Net cash provided by financing activities | $86 | $181 | | Net decrease in cash and cash equivalents | $(520) | $(970) | | Cash and cash equivalents, end of period | $2,288 | $6,155 | Reconciliation of GAAP to Non-GAAP Measures Smith Micro provides non-GAAP measures, excluding items like stock compensation and amortization, to offer a more meaningful analysis of ongoing operations, transforming a GAAP net loss of $5.2 million into a non-GAAP net loss of $2.9 million in Q1 2025 - Management believes non-GAAP measures are more indicative of ongoing operational performance by excluding items such as stock compensation, intangibles amortization, depreciation, fair value adjustments, and goodwill impairment[6] Q1 2025 GAAP to Non-GAAP Net Loss Reconciliation (in thousands) | Item | Amount | | :--- | :--- | | GAAP Net Loss | $(5,178) | | Stock Compensation | $1,088 | | Intangibles Amortization | $1,276 | | Depreciation | $74 | | Fair Value Adjustments | $(123) | | Non-GAAP Net Loss | $(2,863) | - The Q1 2024 non-GAAP calculation notably excluded a $23.989 million goodwill impairment charge[15] Other Information This section provides logistical details for investors, including conference call information, a company business overview, and standard legal disclaimers regarding forward-looking statements and risks Investor Conference Call An investor conference call was scheduled for May 7, 2025, at 4:30 p.m. ET to discuss the Q1 2025 financial results - An investor conference call was scheduled for May 7, 2025, at 4:30 p.m. ET to discuss the Q1 2025 financial results[7] About Smith Micro Software, Inc. Smith Micro develops software to simplify and enhance the mobile experience for wireless service providers, focusing on family digital lifestyle, voice messaging, and content monetization - The company's business is to develop software for wireless service providers that simplifies the mobile experience, focusing on the family digital lifestyle and voice messaging capabilities[8] Forward-Looking Statements The press release contains forward-looking statements subject to risks and uncertainties, including customer concentration, deployment delays, and reliance on third-party technology - The company identifies significant risks that could affect future results, including dependency on a few large customers, delays in product deployment, and reliance on third-party operating systems and application stores[10]