Smith Micro Software (SMSI) AI Stock Analysis

• Market Cap: $14.61M
• Dividend Yield: N/A
• Average Volume (3M): 917.41K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.19
• Revenue Growth: -24.08%
• EPS Growth: 70.11%
• Country: US
• Employees: 164
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): -0.25
• Shares Outstanding: 25,206,337
• 10 Day Avg. Volume: 2,390,606
• 30 Day Avg. Volume: 917,415
• PEG Ratio: -0.01
• Price to Book (P/B): 0.40
• Price to Sales (P/S): 0.79
• P/FCF Ratio: -1.13
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 0.95
• Enterprise Value/Gross Profit: 1.28
• Enterprise Value/Ebitda: -1.25
• 1Y Price Target: $4.00
• Price Target Upside: 614.29% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 45 Neutral
• Price Target: $0.61 ▲(9.64% Upside)

Smith Micro Software's overall stock score is primarily impacted by its weak financial performance, characterized by declining revenues and significant losses. While technical analysis and valuation also present challenges, recent corporate events and strategic initiatives provide some optimism for future improvement.

Positive Factors

Cost Reduction Measures

The cost reduction measures are expected to significantly enhance financial stability by reducing operational expenses, which is crucial for improving profitability and cash flow over the long term.

Strong Pipeline Growth

A robust pipeline indicates potential future revenue growth and market expansion, which could lead to improved financial performance and competitive positioning.

Expansion of SafePath Platform

The expansion of the SafePath platform enhances product offerings and aligns with market needs, potentially increasing customer adoption and long-term revenue.

Negative Factors

Declining Revenue

Declining revenue indicates challenges in maintaining sales growth, which could impact the company's ability to invest in new opportunities and sustain operations.

Negative Cash Flow

Negative cash flow highlights issues in cash generation, which can strain financial resources and limit the company's ability to fund growth initiatives.

Net Losses

Ongoing net losses reflect operational inefficiencies and financial challenges, potentially hindering the company's ability to achieve profitability and long-term sustainability.

Smith Micro Software Business Overview & Revenue Model

Company Description

Smith Micro Software, Inc. (SMSI) is a leading provider of software solutions that empower mobile service providers, enterprises, and consumers to enhance their digital experiences. Founded in 1982 and headquartered in Aliso Viejo, California, the company operates primarily in the technology sector, focusing on key areas such as mobile communications, networking, and digital content management. SMSI's core products include mobile device management (MDM) solutions, secure messaging platforms, and software for providing value-added services, which help clients manage devices and optimize their mobile strategies.

How the Company Makes Money

Smith Micro generates revenue primarily through software licensing, subscription services, and professional services. The company offers its products on a subscription basis, providing recurring revenue from mobile carriers and enterprises that rely on its software for device management and security. Additionally, SMSI earns money through one-time software licenses and maintenance fees. Key revenue streams include partnerships with telecommunications companies that integrate SMSI's solutions into their service offerings, as well as direct sales to enterprise customers seeking to enhance their mobile infrastructure. The company also benefits from strategic alliances and collaborations that expand its market reach and enhance product offerings, contributing to its overall earnings.

Smith Micro Software Financial Statement Overview

Summary

Smith Micro Software faces significant financial challenges across all verticals. The income statement shows declining revenues and substantial losses, while the balance sheet reflects low leverage but poor returns on equity. Cash flow issues are pronounced, with negative cash flows and deteriorating cash generation. The company needs to address operational inefficiencies and improve revenue growth to stabilize its financial position.

Income Statement

Smith Micro Software's income statement shows significant challenges. The company has experienced declining revenue with a negative revenue growth rate of -1.61% TTM, indicating shrinking sales. Profitability metrics are concerning, with a negative net profit margin of -166.15% and negative EBIT and EBITDA margins, reflecting operational inefficiencies and high costs relative to revenue. The gross profit margin remains relatively strong at 73.42% TTM, suggesting some ability to cover direct costs, but overall profitability is severely impacted by high operating expenses.

Balance Sheet

The balance sheet of Smith Micro Software reveals a mixed picture. The debt-to-equity ratio is low at 0.09 TTM, indicating conservative leverage and a low risk of financial distress from debt. However, the return on equity is negative at -90.20% TTM, highlighting significant losses relative to shareholder equity. The equity ratio is not explicitly calculated, but the relatively low debt levels suggest a reasonable proportion of equity financing. Overall, while leverage is low, the company's inability to generate returns is a concern.

Cash Flow

Cash flow analysis for Smith Micro Software indicates substantial challenges. The company has negative operating cash flow and free cash flow, with a free cash flow growth rate of -14.75% TTM, suggesting worsening cash generation capabilities. The operating cash flow to net income ratio is negative, reflecting cash outflows exceeding net income losses. The free cash flow to net income ratio is slightly above 1, indicating that free cash flow is marginally better than net income, but both remain negative. Overall, cash flow management is a critical issue.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	18.36M	20.55M	40.86M	48.51M	58.42M	51.30M
Gross Profit	13.58M	14.43M	30.30M	34.30M	45.72M	46.11M
EBITDA	-13.86M	-19.10M	-10.66M	-17.67M	-8.74M	7.10M
Net Income	-29.17M	-48.70M	-24.40M	-29.28M	-31.04M	4.17M
Balance Sheet
Total Assets	27.13M	48.05M	85.58M	103.58M	114.51M	72.90M
Cash, Cash Equivalents and Short-Term Investments	1.39M	2.81M	7.13M	14.03M	16.08M	25.75M
Total Debt	2.37M	2.57M	3.26M	13.42M	5.87M	6.24M
Total Liabilities	7.24M	7.29M	10.19M	27.20M	13.95M	14.19M
Stockholders Equity	19.89M	40.76M	75.39M	76.38M	100.56M	58.72M
Cash Flow
Free Cash Flow	-9.96M	-14.31M	-6.98M	-19.31M	-13.75M	6.60M
Operating Cash Flow	-9.93M	-14.29M	-6.97M	-19.26M	-12.92M	7.92M
Investing Cash Flow	1.23M	178.00K	132.00K	115.00K	-57.50M	-14.68M
Financing Cash Flow	8.59M	9.80M	-60.00K	17.09M	60.74M	4.24M

Smith Micro Software Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 0.56 is below the 20-day moving average (MA) of 0.61, below the 50-day MA of 0.66, and below the 200-day MA of 0.79, indicating a bearish trend. The MACD of -0.01 indicates Negative momentum. The RSI at 40.24 is Neutral, neither overbought nor oversold. The STOCH value of 35.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SMSI.

Smith Micro Software Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
SMSI	45 Neutral	$14.61M	-0.36	-101.21%	―	-24.08%	70.11%
NVNI	45 Neutral	$9.95M	-0.81	―	―	―	―

Smith Micro Software Corporate Events

Smith Micro Software Secures $2.65M in New Funding

On November 5, 2025, Smith Micro Software entered into two separate securities purchase agreements. The first agreement involved a registered direct offering with institutional and accredited investors, resulting in gross proceeds of approximately $1.15 million. Concurrently, the company engaged in a private placement with its CEO, Bill Smith, generating $1.5 million. The combined proceeds of $2.65 million are intended for working capital and general corporate purposes. These transactions are expected to strengthen Smith Micro’s financial position, with the closing of both offerings anticipated around November 6, 2025.

Smith Micro Software Approves Share Issuance Proposal

On October 16, 2025, Smith Micro Software, Inc. held a special meeting of stockholders where two proposals were voted on. The stockholders approved the issuance of shares under a Securities Purchase Agreement, which could exceed 20% of the company’s outstanding common stock, and also approved the potential adjournment of the meeting to solicit more proxies if needed.

Smith Micro Software Secures $400,000 Loan Agreement

On September 29, 2025, Smith Micro Software, Inc. entered into a Note Purchase Agreement with accredited investors to secure $400,000 in loans, accompanied by promissory notes and stock purchase warrants. The funds, expected to be used for working capital and general corporate purposes, are secured by the company’s assets and due by March 31, 2026. The agreement includes provisions for stockholder approval on warrant adjustments and is aimed at strengthening the company’s financial position.

Smith Micro Software Secures $805,000 in New Loans

On September 11, 2025, Smith Micro Software entered into Note Purchase Agreements with its chairman and CEO, William W. Smith, Jr., and its COO and CFO, Timothy C. Huffmyer, to secure loans totaling up to $805,000. These agreements, approved by independent committees, involve secured promissory notes and unregistered common stock purchase warrants, with the proceeds intended for working capital and general corporate purposes. The transactions are expected to impact the company’s financial flexibility and operational capabilities positively.