Summary of SoundThinking (SSTI) Conference Call Company Overview - **Company Name**: SoundThinking, formerly known as ShotSpotter - **Ticker Symbol**: SSTI - **Industry**: Public safety technology, focusing on AI and data-driven solutions for law enforcement and security professionals [1][2] Core Business and Growth Strategy - **Unique Platform**: SoundThinking offers a SafetySmart platform that includes various applications aimed at enhancing law enforcement productivity [3] - **Revenue Diversification**: Initially, ShotSpotter accounted for 100% of revenues; now it represents 65%, with expectations to drop to 35% as new solutions are introduced [5] - **Revenue Figures**: - 2024 Revenue: $102 million with 14% adjusted EBITDA - 2025 Projected Revenue: $111 to $113 million with 20% to 22% adjusted EBITDA [6] Product Offerings - **ShotSpotter**: Acoustic gunshot detection technology, crucial for real-time alerts to law enforcement [11] - **ResourceRouter**: AI-based patrol management solution to optimize resource deployment [19] - **CaseBuilder**: Integrated case management tool for detectives, improving case closure rates [20] - **CrimeTracer**: Search and analytics tool with access to over 1 billion police records [21] - **SafePointe**: Weapons detection technology aimed at commercial security [23] - **PlateRanger**: Automatic license plate reader technology [4] Market Opportunity - **Total Addressable Market (TAM)**: Significant growth potential in public safety technology, particularly in concealed weapons detection and international markets [4][29] - **International Expansion**: Recent sales in Latin America (Uruguay and Brazil) with pricing leverage of 3-4 times domestic rates [8][35] Financial Metrics - **Customer Acquisition Cost**: $0.63 per dollar of annual contract value, indicating strong unit economics [7] - **Retention Rates**: High net revenue retention and gross retention rates, supported by a strong Net Promoter Score (NPS) [6][10] - **Long-term Financial Goals**: Targeting 15% top-line revenue growth, 70% gross margin, and 40% adjusted EBITDA over the next few years [29][30] Operational Insights - **Service Level Agreement (SLA)**: 90% SLA with 97% effectiveness in alert accuracy, including false positives and location accuracy [16][17] - **Cost Management**: Anticipated flat costs in goods sold while revenue increases, leading to improved gross margins [28][30] Customer Engagement - **Product Bundling**: Approximately 30 customers utilize more than one solution, with some using up to four [33] - **Strategic Relationships**: Building long-term relationships with law enforcement agencies to enhance service delivery and customer loyalty [10] Additional Considerations - **Acquisitions**: Four acquisitions in the last six years, with no immediate plans for further acquisitions but remaining open to opportunities [30] - **Cash Flow**: Generated $16 million in free cash flow last year, with a focus on maintaining a strong balance sheet [29] This summary encapsulates the key points from the SoundThinking conference call, highlighting the company's strategic direction, product offerings, financial performance, and market opportunities.

Company Overview - SoundThinking, Inc. (Nasdaq: SSTI) is a leading public safety technology company that provides AI- and data-driven solutions for law enforcement, civic leadership, and security professionals [3] - The company serves over 300 customers and has collaborated with approximately 2,100 agencies to enhance public safety outcomes [3] - SoundThinking's product offerings include ShotSpotter®, CrimeTracer, CaseBuilder, ResourceRouter, SafePointe®, and PlateRanger powered by Rekor® [3] Upcoming Events - SoundThinking will present at the 2025 Annual Gateway Conference on September 4th at 11:00 a.m. Pacific Time [2] - The presentation will be available via live webcast and for replay [2] - Executives from SoundThinking will be available for one-on-one meetings with investors during the conference [2] Company Recognition - SoundThinking has been recognized as a Great Place to Work® company [3]

Financial Data and Key Metrics Changes - The company's Q2 2025 revenues were $25.9 million, representing a 4% decrease from $27 million in Q2 2024, which included a $2.8 million revenue loss from the non-renewal of the Chicago contract [16][17] - Gross profit for Q2 2025 was $13.8 million, or 53% of revenue, compared to $16.1 million, or 60% of revenue in the prior year [17] - Adjusted EBITDA was $3.4 million in Q2 2025, down from $5.1 million in Q2 2024, reflecting delayed contracts and increased costs [17][18] - GAAP net loss was approximately $3.1 million, or a loss of $0.25 per share, compared to a net loss of $800,000, or a loss of $0.06 per share in the prior year [20] Business Line Data and Key Metrics Changes - The company launched ShotSpotter Live in four new cities and expanded in four additional cities during Q2 2025, contributing to a diversified pipeline of over $37 million for the remainder of 2025 [5][6] - The SafePoint pipeline is healthy, with a focus on healthcare and casino verticals, particularly in California due to the AB 2,975 initiative [25] - The integration of the PlateRanger LPR solution with CrimeTracer enhances investigative capabilities, allowing for quicker access to actionable intelligence [9][10] Market Data and Key Metrics Changes - The company is expanding its footprint in South America, with notable deployments in Niteroi, Brazil, and Montevideo, indicating growth opportunities in Latin America [26][27] - The healthcare vertical is expected to benefit from California's new legislation mandating weapon screening capabilities at state hospitals [11] Company Strategy and Development Direction - The company is focused on transforming into a broader public safety technology firm, emphasizing sustainable growth and operational execution [4] - Strategic investments in technology, innovation, and market positioning are yielding positive results, with plans to deepen penetration in existing customer accounts and expand into mid-size municipalities [14][15] - The company is also exploring new opportunities in critical infrastructure protection, particularly with a sniper detection solution aimed at utility companies and financial institutions [6][42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver lifesaving alerts and critical crime intelligence, positioning itself well despite potential political changes [12] - The company reaffirmed its full-year revenue guidance of $111 million to $113 million and adjusted EBITDA margin guidance of 20% to 22% [23] - The annual recurring revenue (ARR) is expected to increase from $95.6 million in 2025 to approximately $110 million in 2026, despite the loss of revenue from the Chicago contract [23] Other Important Information - The company ended Q2 2025 with $9 million in cash and cash equivalents, down from $11.7 million at the end of Q1 2025, but cash balance has since increased to over $16 million [20][21] - The company repurchased 31,570 shares at an average price of $14.84, totaling approximately $1.5 million [21] Q&A Session Summary Question: Can you talk about the SafePoint pipeline? - The SafePoint pipeline continues to grow, focusing on healthcare and casino verticals, with significant opportunities in California [25] Question: How is the international market developing? - Recent developments in South America, particularly in Brazil, are promising, with opportunities for expansion in Mexico and South Africa [26][27] Question: What contributed to the increase in cash balance? - The increase is primarily due to timing in receivable collections, indicating strong cash flow generation [28] Question: How much visibility is there into the second half revenue guidance? - The sales team has committed to contracts that should help meet guidance, but timing of large contracts may affect results [30] Question: Can you provide details on the Chicago RFP? - The company is on a shortlist for the Chicago RFP, with a live demonstration scheduled for September, indicating progress in the selection process [54] Question: What are the details regarding the NYPD contract? - The NYPD contract involves a $400,000 expense per quarter, with a revenue of about $250,000 per quarter, leading to overall savings [56] Question: When can the company expect revenue from the SafePoint implementation? - Revenue from the SafePoint implementation is included in the guidance, and the company is working to expedite deployment [48][50]

Core Viewpoint - SoundThinking, Inc. has introduced generative AI capabilities in its CrimeTracer product, enhancing law enforcement's ability to quickly access critical investigative information through natural language queries [1][2][3] Company Overview - SoundThinking, Inc. is a leading public safety technology provider, known for its AI- and data-driven solutions for law enforcement and civic leadership [9] - The company has worked with approximately 2,100 law enforcement agencies across the United States, conducting millions of searches annually to support investigations [3][9] Product Enhancement - The new generative AI functionality allows users to interact with CrimeTracer using conversational queries, simplifying the search process and enabling officers to find connections across billions of records [2][3] - This enhancement is currently in beta testing with select agencies and is expected to be available to all CrimeTracer customers this summer at no additional cost [2][3] Benefits of AI Integration - The AI search capabilities provide several key benefits: - Natural Language Queries: Officers can ask questions using everyday language rather than technical search syntax [7] - More Comprehensive Results: The system can identify connections across disparate data sources that might otherwise be missed [7] - Increased Efficiency: The technology reduces the time spent formulating searches and analyzing results [7] - Democratized Access: Advanced search capabilities are accessible to all officers, not just specialized analysts [7] User Feedback - Early testing of the AI chatbot has shown strong potential for providing faster and easier access to crime data, helping investigators surface hard-to-find connections that can advance cases [4]

Core Viewpoint - SoundThinking has integrated PlateRanger into its SafetySmart platform, enhancing public safety capabilities and enabling law enforcement agencies to improve investigative workflows and outcomes [2][4]. Integration and Technology - The integration of PlateRanger, an advanced license plate recognition solution, with ShotSpotter and CrimeTracer allows law enforcement to combine real-time gunshot detection data with vehicle identification and cross-jurisdictional insights [3][5]. - The Rekor Public Safety Network (RPSN) facilitates secure data sharing across jurisdictions, enhancing investigative speed and interoperability while respecting data ownership [6][7]. Benefits to Law Enforcement - The integration provides enhanced investigations by linking gunfire events with suspect vehicle data, allowing for more comprehensive follow-up [5]. - Multi-agency collaboration is improved through integrated systems that enable data sharing, helping to uncover connections between incidents [7]. - The commitment to open standards allows for seamless integration with existing systems, differentiating SoundThinking in the market [7]. Market Impact - SoundThinking serves over 175 ShotSpotter customers and approximately 2,100 CrimeTracer agencies, providing access to more than 1 billion records, thus expanding its market footprint [8].