SoundThinking, Inc., a public safety technology company, provides data-driven solutions and strategic advisory services for law enforcement, security teams, and civic leadership. ...
SoundThinking, Inc. (Nasdaq: SSTI) is a leading public safety technology company headquartered in Fremont, California, with a mission to help law enforcement and civic leadership work together to improve public safety. The company was founded in 1996 by physicist Dr. Robert Showen as ShotSpotter, Inc., initially focusing on acoustic gunshot ...SoundThinking, Inc. (Nasdaq: SSTI) is a leading public safety technology company headquartered in Fremont, California, with a mission to help law enforcement and civic leadership work together to improve public safety. The company was founded in 1996 by physicist Dr. Robert Showen as ShotSpotter, Inc., initially focusing on acoustic gunshot detection. In 2010, Ralph A. Clark was hired as CEO and led a transformation to a SaaS-based model, expanding the company's offerings. In April 2023, the company was rebranded as SoundThinking to reflect its broader product portfolio.
The company's core product, SafetySmart, integrates several data-driven tools: ShotSpotter, an outdoor gunshot detection, location, and alerting system; CrimeTracer, a crime data and intelligence platform that enables investigators to search criminal justice records across jurisdictions; CaseBuilder, an investigative case management system; ResourceRouter, software for deploying patrol and community anti-violence resources; PlateRanger (powered by Rekor), an automatic license plate recognition solution; and SafePointe, an AI-based weapons detection system. Additionally, SoundThinking offers ShotSpotter for Campus and ShotSpotter for Corporate, serving universities, corporate campuses, and critical infrastructure. The company also provides perimeter-based sniper gunshot detection solutions.
SoundThinking serves over 300 customers and has worked with approximately 2,100 law enforcement agencies. As of the latest data, the company has 305 full-time employees. Financially, SoundThinking has a market cap of about $105 million, with a price-to-sales ratio of approximately 1.05 and a price-to-book ratio of 1.54. The company is currently unprofitable, with a net profit margin of -14.9% (TTM), but it expects to grow revenue through recurring SaaS subscriptions. Key financial metrics include a gross profit margin of 51.3% (TTM) and an operating cash flow per share of $0.75. The company's leadership includes CEO Ralph Clark, who has been at the helm since 2010 and has guided the company from an idea to a publicly traded entity. SoundThinking continues to expand its product lines and strategic advisory services, aiming to become the leading provider of public safety technology solutions.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$104.1M
+2.1%
-1.2%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$-9.4M
-2.6%
+32.2%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+54.4%
-5.1%
+3.7%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
-8.2%
-6.5%
+25.5%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
-9.0%
-0.5%
+31.4%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$4.8M
-69.3%
-434.9%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
+4.7%
-69.9%
-441.3%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
8.3%
-0.5%
-16.7%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
0.85x
+9.0%
-3.9%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Good afternoon, and welcome to SoundThinking's second quarter 2026 earnings conference call. My name is Cleo, and I will be your operator for today's call. Joining us are SoundThinking's CEO, Ralph Clark, and CFO, Alan Stewart. Please note that certain information discussed on today's call will include forward-looking statements for future events and SoundThinking's business strategy and future financial and operating performance. These forward-looking statements are only predictions, and they are subject to risks and uncertainties and assumptions that are difficult to predict and may cause actual results to differ materially from those stated or implied by these statements. Certain of these risks, uncertainties, and assumptions are discussed in SoundThinking's SEC filings, including its most recent annual report on Form 10-K and other SEC filings. These forward-looking statements reflect management's beliefs, estimates, and predictions as of the date of this live broadcast, August 13, 2026, and SoundThinking undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. In addition, our comments on the call today contain references to non-GAAP financial measures such as adjusted EBITDA and key business metrics such as annual recurring revenue. Non-GAAP measures should be reviewed in addition to and not as alternative for the company's reported GAAP results. A reconciliation of these non-GAAP measures to their most directly compatible GAAP measures as well as definitions of the key business metrics referenced and management's reasons for including the non-GAAP measures and key business metrics referenced may be found in the press release. Finally, I would like to remind everyone that this call will be recorded and made available for replay via a link available in the investor relations section of the company's website at ir.soundthinking.com. With that, I will now turn the call over to Ralph.
Ralph Clark: Good afternoon and thank you for joining us. I want to start today's call in an unusual place by going back to last quarter's call. In Q1, we discussed several strategic initiatives that we believed would shape our year. I want to review those strategic initiatives and share where we delivered and where we fell short, and more importantly, what we're doing on a go-forward basis. Let's start on where we delivered. I told you our year had structural shape and that Q1 sat below our operating leverage line and that Q2 through Q4 would sit above it, with incremental revenue converting to adjusted EBITDA. Despite sequential flattish revenue growth, we crossed that line in Q2. Adjusted EBITDA moved from roughly negative $100,000 in the first quarter to a positive $1.2 million in the second quarter. We've been aggressively applying AI across our own operations, and that is a meaningful part of why we believe the workforce and business optimization initiatives we …