• Revenue: $5 million for Q4 2024, a decrease of 42% from $8.6 million in Q4 2023. Full-year 2024 revenue was $20.6 million, down from $40.9 million in 2023.
• Family Safety Revenue: $3.8 million in Q4 2024, a 49% decrease from Q4 2023.
• CommSuite Revenue: $1.1 million in Q4 2024, an increase of $600,000 from Q4 2023.
• Gross Profit: $3.8 million in Q4 2024, down from $6.4 million in Q4 2023.
• Gross Margin: 76% in Q4 2024, compared to 75% in Q4 2023.
• GAAP Operating Expenses: $8.2 million in Q4 2024, a decrease of 32% from Q4 2023.
• Non-GAAP Operating Expenses: $5.8 million in Q4 2024, a decrease of 27% from Q4 2023.
• GAAP Net Loss: $4.4 million or $0.25 loss per share in Q4 2024, compared to $6.7 million or $0.74 loss per share in Q4 2023.
• Non-GAAP Net Loss: $1.9 million or $0.11 loss per share in Q4 2024, compared to $1.7 million or $0.18 loss per share in Q4 2023.
• Cash and Cash Equivalents: $2.8 million as of December 31, 2024.

• Warning! GuruFocus has detected 5 Warning Signs with SMSI.

Release Date: March 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Smith Micro Software Inc (NASDAQ:SMSI) has successfully launched SafePath Kids with Orange Spain, marking a significant deployment that aligns with the carrier's core offerings.
• The company is experiencing strong interest in its SafePath OS platform, with ongoing discussions with several partners worldwide.
• CommSuite revenues increased by approximately $600,000 compared to the fourth quarter of 2023, driven by subscriber growth on the Boost CommSuite premium visual voicemail platform.
• Smith Micro Software Inc (NASDAQ:SMSI) has reduced its GAAP operating expenses by 32% in the fourth quarter of 2024 compared to the same period in 2023, due to cost reduction activities.
• The company is planning to launch SafePath OS for seniors, targeting a rapidly growing market segment, which promises significant upside potential.

Negative Points

• Smith Micro Software Inc (NASDAQ:SMSI) reported a 42% decrease in revenue for the fourth quarter of 2024 compared to the same quarter in 2023, primarily due to the conclusion of the Verizon Family Safety Contract.
• The company's Family Safety revenues decreased by approximately 49% compared to the fourth quarter of the prior year.
• ViewSpot revenue was nominal for the fourth quarter of 2024, declining by approximately $500,000 compared to the fourth quarter of the prior year.
• Smith Micro Software Inc (NASDAQ:SMSI) reported a GAAP net loss of $4.4 million for the fourth quarter of 2024, although this was an improvement from the $6.7 million loss in the same period of 2023.
• The company anticipates a decline in CommSuite revenues in the first quarter of 2025 due to a favorable adjustment to revenues recognized in the fourth quarter of 2024.

Q & A Highlights

Q: Can you provide insights on the success metrics for the TuYo launch and the potential for new customer acquisitions? A: William Smith, CEO, noted that there is significant interest in Europe driven by TuYo, with nearly half of sign-ups coming from competitors. This indicates strong market penetration. The success in Spain is expected to lead to further growth in other Orange markets. The company is actively engaging with multiple carriers, aiming for a summer launch to align with back-to-school promotions.

Q: What is the timeline for the commercialization of the senior safety phone, and what is the market potential? A: William Smith, CEO, highlighted the senior market as a significant opportunity, with a broad spectrum of needs. The core SafePath OS product is ready, and the company is in discussions with carriers focused on the senior market. The senior safety phone is expected to launch soon, targeting a largely underserved market.

Q: Are you expecting sequential growth in the upcoming quarters, especially considering the positive trends? A: William Smith, CEO, anticipates growth in the latter half of the year, driven by new customer launches. The current quarter is a pause to address product issues, but the company expects a return to profitability and free cash flow generation in the back half of the year.

Q: How is the competitive landscape, particularly with Verizon's in-house efforts, affecting your market position? A: William Smith, CEO, believes Smith Micro has a strong position in servicing carriers, with high app ratings compared to competitors. Verizon has developed its own product, but Smith Micro's focus on carrier partnerships and unique offerings like SafePath OS for kids and seniors positions them well in the market.

Q: What is your long-term vision for the company, considering past successes and current opportunities? A: William Smith, CEO, envisions a return to past levels of success, with potential for significant revenue growth. The pivot to align with carrier core offerings rather than value-added services is seen as a strategic move to drive subscriber growth and align with carrier business objectives.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.