SOUNDTHINKING, INC. Q1 FY2025 earnings call

• Financial results: Q1 revenue $28.3M, 12% y-o-y growth; adjusted EBITDA $4.5M, up 50% y-o-y. Catch-up revenue from NYPD contract renewals.
• Strategic initiatives: Expanding platform and data aggregation; ShotSpotter renewal with NYPD and international expansion; CrimeTracer's AI-driven features and integration with PlateRanger; ResourceRouter's growth; SafePointe's focus on health care and other verticals due to California legislation.
• Market context: Headwinds from municipal funding and budgets; tailwinds from strong demand for public safety solutions.

In the first quarter, SoundThinking achieved 12% year-over-year revenue growth to $28.3 million. ShotSpotter contributed significantly, with $3.5 million catch-up revenue from NYPD contract renewals. Adjusted EBITDA grew 50% to $4.5 million. ShotSpotter renewed NYPD contract for 3 years, went live with 4 new cities plus 1 expansion, and has a robust international pipeline with a soon-to-be live deployment in Niteroi, Brazil. CrimeTracer warehouses over 1 billion CJIS compliant documents for over 1,000 law enforcement agencies, deployed new natural language query features, and integrated with PlateRanger's ALPR data. ResourceRouter is deployed in over 20 agencies, more than double its installed base in 18 months. SafePointe targets health care, casino, and commercial properties, leveraging California's AB 2975 mandate for weapon detection systems in hospitals by 2027, with significant addressable opportunities in California and other states.

• Reaffirmed full-year revenue guidance: $111 million to $113 million.
• Reduced adjusted EBITDA margin guidance: To 20% to 22% due to tariff changes and AI investments.
• ARR expectation: To increase from $95.6 million at the start of 2025 to ~$110 million at the start of 2026.

• Volatility in municipal funding and budgets.
• Uncertainty around procurement processes, such as the Chicago gunshot detection RFP.
• Impact of tariff changes and AI investment costs on margins.

Q: How manage pipeline across product areas?

A: Each product has own pipeline metrics, tracking solid pipeline, particularly ResourceRouter and CrimeTracer, targeting 3x-4x coverage.

Q: Early feedback on SafePointe?

A: Success in health care, casino, commercial properties, especially health care due to discrete architecture.

Q: PlateRanger bookings and Puerto Rico expansion?

A: PlateRanger pipeline significant, bookings ~1M+, Puerto Rico in ongoing discussions for extension/expansion.

Q: SafePointe sales cycle and 2027 requirement?

A: 2026 opportunity, making traction in California, health care, casino, commercial; need to invest in California market.

Q: Revenue progression post Q1 lumpiness?

A: Q2 likely reduction, Q3-Q4 expected to increase as SafePointe revenue recognizes.

Q: Margin guide and gross margin impact?

A: Gross margin ~59%, adjusted EBITDA impact from all-hands meeting, AI costs, AWS usage.

Q: SafePointe addressable facilities and cost vs traditional solutions?

A: ~400 hospitals in CA with ~10 lanes each; pricing ~$20k/year per lane, compelling total cost vs traditional solutions.

Q: International opportunities timing?

A: Late 2025/early 2026 for some international expansions, e.g., Brazil, South Africa.

Q: R&D costs and AI investments?

A: R&D costs ~$4.1M, primarily for AI personnel and AWS bandwidth, related to SafePointe modeling.