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Smith Micro Software (SMSI)
NASDAQ:SMSI
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Smith Micro Software
(NASDAQ:SMSI)
26Underperform
Smith Micro Software (SMSI) vs. S&P 500 (SPY)
Market Cap
$14.15M
Dividend YieldN/A
Average Volume (3M)251.11K
Price to Earnings (P/E)―
Beta (1Y)1.08
Revenue Growth-49.70%
EPS Growth-59.04%
CountryUS
Employees164
SectorTechnology
Sector Strength51
IndustrySoftware - Application
Share Statistics
EPS (TTM)-4.72
Shares Outstanding17,773,859
10 Day Avg. Volume128,974
30 Day Avg. Volume251,114
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.71
Price to Cash Flow (P/CF)-0.70
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Smith Micro Software Business Overview & Revenue Model
Company DescriptionSmith Micro Software, Inc. is a software solutions company that specializes in developing and marketing wireless and mobility software products and services. The company primarily operates in the telecommunications sector, providing solutions that empower wireless network operators, original equipment manufacturers (OEMs), and enterprises to optimize and manage their wireless networks. Its core products include platforms for network connectivity, device management, and location-based services, which are designed to enhance the user experience and improve operational efficiency.
How the Company Makes MoneySmith Micro Software makes money through the sale of its software solutions and services to wireless carriers, device manufacturers, and enterprises. The company's revenue model is primarily based on licensing its software platforms, offering subscription-based services, and providing professional services such as software customization and integration. Key revenue streams include recurring revenue from software licenses, maintenance and support contracts, and additional services related to their software products. Significant partnerships with major wireless carriers and technology companies also contribute to its earnings by expanding its market reach and customer base.
Smith Micro Software Financial Statement Overview
Summary
Smith Micro Software is facing significant financial challenges, showcased by declining revenues, negative profitability, and weak cash flow generation. The company is struggling with operational inefficiencies and increased leverage, raising concerns about its ability to sustain operations without strategic changes. Despite a relatively low debt level, the persistence of negative cash flows and net income suggests potential liquidity risks.Income Statement
Smith Micro Software has experienced a significant decline in revenue and profitability over recent years. The Gross Profit Margin has decreased from 89.9% in 2019 to 70.2% in 2024, indicating a reduction in operational efficiency. Net Income has turned negative since 2021, leading to a negative Net Profit Margin of -236.8% for 2024. Revenue has been on a declining trend, with a Revenue Growth Rate of -49.7% from 2023 to 2024. The EBIT and EBITDA Margins have also been negative, reflecting operational challenges.25
Negative
Balance Sheet
The company's balance sheet shows a concerning trend with declining equity and increasing dependence on debt. The Debt-to-Equity Ratio has worsened from 0.12 in 2019 to 0.06 in 2024, indicating rising leverage. The Equity Ratio has decreased from 79.5% in 2019 to 84.8% in 2024, showing a decrease in equity financing. Return on Equity has been negative since 2021, highlighting profitability challenges. Despite a decrease in total assets, the company maintains a low level of net debt.35
Negative
Cash Flow
Cash flow analysis reveals significant weaknesses, with Operating Cash Flow turning negative since 2021. Free Cash Flow has also been negative, indicating inadequate cash generation to cover capital expenditures and finance operations. The Operating Cash Flow to Net Income Ratio and Free Cash Flow to Net Income Ratio are unfavorable, highlighting cash flow difficulties relative to earnings.20
Very Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 20.55M | 40.86M | 48.51M | 58.42M | 51.30M | Gross Profit |
| 14.43M | 30.30M | 34.30M | 45.72M | 46.11M | EBIT |
| -43.26M | -18.05M | -30.93M | -5.21M | 3.52M | EBITDA |
| -42.31M | -10.49M | -17.67M | -7.24M | 3.52M | Net Income Common Stockholders |
| -48.70M | -24.40M | -29.28M | -31.04M | 4.17M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 2.81M | 7.13M | 14.03M | 16.08M | 25.75M | Total Assets |
| 48.05M | 85.58M | 103.58M | 115.36M | 72.90M | Total Debt |
| 2.57M | 3.26M | 13.42M | 5.87M | 6.24M | Net Debt |
| -242.00K | -3.86M | -602.00K | -10.21M | -19.52M | Total Liabilities |
| 7.29M | 10.19M | 27.20M | 14.80M | 14.19M | Stockholders Equity |
| 40.76M | 75.39M | 76.38M | 100.56M | 58.72M |
| Cash Flow | Free Cash Flow | |||
| -14.29M | -6.98M | -19.31M | -13.75M | 6.60M | Operating Cash Flow |
| -14.29M | -6.97M | -19.26M | -12.92M | 7.92M | Investing Cash Flow |
| 178.00K | 132.00K | 115.00K | -57.50M | -14.68M | Financing Cash Flow |
| 9.80M | -60.00K | 17.09M | 60.74M | 4.24M |
Smith Micro Software Technical Analysis
Negative
0.80
Price Trends
1.08
Negative
1.08
Negative
1.18
Negative
Market Momentum
-0.12
Negative
35.90
Neutral
15.87
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMSI, the sentiment is Negative. The current price of 0.8 is above the 20-day moving average (MA) of 0.78, below the 50-day MA of 1.08, and below the 200-day MA of 1.18, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 35.90 is Neutral, neither overbought nor oversold. The STOCH value of 15.87 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SMSI.
Smith Micro Software Risk Analysis
Smith Micro Software disclosed 28 risk factors in its most recent earnings report. Smith Micro Software reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Smith Micro Software Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
57 Neutral | $19.95B | 9.66 | -12.05% | 2.76% | 5.40% | -24.89% | |
56 Neutral | $5.74M | ― | -25.45% | ― | -2.48% | 21.51% | |
54 Neutral | $8.96M | ― | 163.42% | ― | ― | ― | |
42 Neutral | $37.83M | ― | 86.76% | ― | 11.25% | 34.57% | |
36 Underperform | $14.35M | ― | -432.30% | ― | 99.64% | -958.75% | |
26 Underperform | $14.15M | ― | -83.85% | ― | -49.70% | -59.04% |
* Technology Sector Average
Performance Comparison
SMSI
Smith Micro Software
0.80
-1.16
-59.18%
DTSS
Datasea
1.88
-6.33
-77.10%
KPLT
Katapult Holdings
7.43
-1.59
-17.63%
MITQ
Moving iMage Technologies
0.62
0.09
16.98%
HUBC
Hub
2.94
-16.56
-84.92%
Smith Micro Software Earnings Call Summary
Earnings Call Date: Mar 11, 2025 | % Change Since: -25.93% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Neutral
The call highlighted promising developments with the launch of SafePath Kids and growing interest in SafePath OS, indicating potential future growth. However, significant revenue declines and ongoing net losses pose challenges. The sentiment is mixed, with notable achievements balancing the substantial financial setbacks.Highlights
Launch of SafePath Kids with Orange Spain
SafePath Kids was successfully launched with Orange Spain's TuYo solution, marking a significant deployment under the renewed focus of aligning with mobile operators' core business. This deployment integrates SafePath directly into the carrier's offering, providing a safer mobile experience for children.
Strong Interest in SafePath OS
There is broadening interest in SafePath OS from several partners worldwide. The company is in in-depth discussions with multiple carriers and plans to capitalize on this growing demand.
CommSuite Revenue Growth
CommSuite revenues increased by approximately $600,000 compared to Q4 2023, driven by subscriber growth on the Boost CommSuite Premium Visual Voicemail platform.
Cost Reduction Achievements
The company exceeded its cost reduction goals with a decrease in total non-GAAP operating expenses of approximately $3.1 million compared to Q1 2024.
Lowlights
Significant Revenue Decline
Q4 2024 revenue was $5 million, a 42% decrease compared to the same quarter in 2023. Annual revenue for 2024 was $20.6 million, a 50% decline from 2023, primarily due to the conclusion of the Verizon Family Safety Contract and decline in legacy Sprint subscribers.
Ongoing GAAP Net Losses
The GAAP net loss for Q4 2024 was $4.4 million, compared to a loss of $6.7 million in Q4 2023. The annual GAAP net loss for 2024 was $48.7 million, significantly higher than the $24.4 million loss in 2023, impacted by a $24 million goodwill impairment charge.
Expected Revenue Decline in Q1 2025
The company expects Q1 2025 revenue to be in the range of $4.6 million to $5 million, partly due to the timing of revenue from ongoing opportunities and an anticipated decline in CommSuite revenues.
Company Guidance
During the Smith Micro Fourth Quarter 2024 Earnings Conference Call, the company provided guidance on several financial metrics and strategic initiatives. They reported a revenue of $5 million for Q4 2024, which showed a 42% decline compared to the same quarter in 2023, but an increase of 7% from Q3 2024. The annual revenue for 2024 was $20.6 million, marking a 50% decrease from 2023, primarily due to the end of the Verizon Family Safety Contract and a decline in Safe and Found Family Safety revenue post the T-Mobile acquisition of Sprint. The gross profit for Q4 2024 was $3.8 million, with a gross margin of 76%, and GAAP operating expenses dropped by 32% from the previous year. The company expects Q1 2025 revenues to range between $4.6 million and $5 million, with a gross margin projected between 72% and 75%. They are focusing on expanding their SafePath offerings, including SafePath Kids and SafePath OS for seniors, which align with mobile operators' core strategies. The company aims for significant growth in the latter half of 2025, driven by new product launches and strategic partnerships.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.