"SoundThinking reveals its projected revenue of $111 million to $113 million for 2025, with a focus on AI development and enhancements to critical infrastructure"
SoundThinking, Inc. (SSTI) has reported Q2 2025 revenue of $25.9 million, marking a 4% decrease compared to the same quarter in 2024. Despite the decline, the company remains optimistic about its growth prospects, focusing on expanding beyond its core law enforcement clients.
In a recent Q&A session, Ralph A. Clark, President and CEO, attributed the decline to the timing of large deals such as a $2.5 million CrimeTracer transaction and a 400-unit PlateRanger transaction, both pushed into Q3. The company ended Q2 with $9 million in cash and cash equivalents.
The company's strategy beyond law enforcement emphasises broader municipal and campus safety solutions, software-as-a-service recurring revenue streams, and market diversification into mid- and small-sized public safety customers to augment its core law enforcement client base. This expansion involves leveraging the "Safety Smart platform solutions" to provide broader public safety technologies that suit various community and institutional needs.
Management reaffirmed full year revenue guidance of $111 million to $113 million and adjusted EBITDA margin guidance of 20% to 22%. Clark noted that bookings "did fall short of our internal targets for the quarter, primarily due to the timing of a few large deals."
Operating expenses for Q2 were $16.7 million, while sales and marketing expenses declined year-over-year. R&D expenses increased to $3.7 million, reflecting higher AI investments. Management emphasized progress in AI integration, new product innovations for critical infrastructure, and expanding penetration in new markets.
One such innovation is the completion of the integration between PlateRanger LPR and CrimeTracer, enabling automated intelligence on vehicles involved in crimes. The company also noted a new opportunity for a hybrid ShotSpotter SecureCampus and perimeter-based sniper solution following the Midtown New York City shooting.
During the Q&A session, analysts' focus shifted slightly toward cash flow, implementation timelines, and traction in new verticals. Management remained direct and reaffirmed guidance, reflecting consistency with their prepared remarks. Their tone remained confident and constructive throughout, with phrases such as "we feel pretty good about the opportunity," and "we're feeling really, really good about our competitive position."
However, political risks in New York were addressed, with management emphasizing contract security and minimal likelihood of termination. A potential risk for SoundThinking was also mentioned, the renewal in Puerto Rico, due to unexpected bureaucratic delays.
In summary, SoundThinking is pursuing growth opportunities and strategic initiatives beyond its core law enforcement clients, aiming to drive operational efficiency while scaling this broader offering to sustain revenue and margin growth. The company's focus on diversification, software-as-a-service recurring revenue, and penetration into new markets is expected to contribute to its expected 10% year-over-year growth.
[1] Source: SoundThinking Press Release [2] Source: SoundThinking Q2 2025 Earnings Call Transcript
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