Smith Micro Software (SMSI)
NASDAQ:SMSI
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Smith Micro Software
(NASDAQ:SMSI)
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Rating:47Neutral
Price Target:
$0.86
▲(18.75% Upside)
Action:ReiteratedDate:03/25/26
The score is held down primarily by weak financial performance (multi-year revenue contraction, persistent losses, and negative cash flow with a low cash balance). The earnings call adds modest support due to credible cost-cutting and improving margin/profitability targets, while technicals are constructive but look overextended. Valuation offers limited help because the negative P/E reflects unprofitability and there is no dividend.
Positive Factors
High and improving gross margins
Sustainably high gross margins (mid-70s in 2025 with an 85% target) reflect a software licensing/analytics model with strong unit economics. If sustained, these margins provide durable operating leverage that supports profitability as revenue stabilizes or grows, reducing capital intensity of the business.
Negative Factors
Multi-year revenue contraction
A sustained, steep decline in revenue over multiple years signals structural demand or competitive challenges. Long-term erosion of top-line reduces scale, weakens bargaining power with carriers, limits R&D and sales investment, and makes it harder to convert high gross margins into steady operating profits.
Read all positive and negative factors
Positive Factors
Negative Factors
High and improving gross margins
Sustainably high gross margins (mid-70s in 2025 with an 85% target) reflect a software licensing/analytics model with strong unit economics. If sustained, these margins provide durable operating leverage that supports profitability as revenue stabilizes or grows, reducing capital intensity of the business.
Read all positive factors
Smith Micro Software (SMSI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.47M
Dividend YieldN/A
Average Volume (3M)917.41K
Price to Earnings (P/E)―
Beta (1Y)1.10
Revenue Growth-24.08%
EPS Growth70.11%
CountryUS
Employees164
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.20
Shares Outstanding25,763,020
10 Day Avg. Volume2,390,606
30 Day Avg. Volume917,415
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.61
Price to Sales (P/S)0.64
P/FCF Ratio-1.53
Enterprise Value/Market Cap0.85
Enterprise Value/Revenue0.90
Enterprise Value/Gross Profit1.21
Enterprise Value/Ebitda-1.13
Forecast
1Y Price Target
$3.00Price Target Upside316.67% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)-0.31
Revenue Forecast (FY)$20.50M
Smith Micro Software Business Overview & Revenue Model
Company Description
Smith Micro Software, Inc. develops and sells software to enhance the mobile experience to wireless and cable service providers worldwide. It offers SafePath Family, SafePath IoT, and SafePath Home product suite, which provides tools to protect di...
How the Company Makes Money
SMSI makes money primarily by licensing its software and providing related services to communications and connectivity-industry customers. Key revenue streams have included: (1) Software licensing/usage revenue from its Wi‑Fi/network management pr...
Smith Micro Software Earnings Call Summary
Earnings Call Date:Mar 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Neutral
The call presents a mixed but cautiously optimistic picture: revenue trends remain negative with meaningful YoY declines and a low cash balance that requires continued financing, which are material concerns. Offsetting this are clear operational improvements — substantial cost reductions, improved gross margins, reductions in non-GAAP losses, committed funding from founders, a refined product strategy (SafePath OS) that expands the addressable market, expected new carrier wins mid-2026, and an orderly leadership succession. Given the balance of meaningful financial risks against tangible progress on margins, cost structure, funding and go-to-market strategy, the tone is constructive but still dependent on execution and the realization of expected customer wins and funding plans.Positive Updates
Strategic Product Shift to SafePath OS and Enlarged TAM
Refocused product strategy on phones with SafePath OS for kids and seniors; senior-focused solution more than doubles the total addressable market and is cited as a key differentiator versus over-the-top apps.
Negative Updates
Revenue Declines — Quarterly and Annual
Q4 2025 revenue of $4.0M versus $5.0M in Q4 2024 (down 20% YoY) and down $0.3M (7%) sequentially from Q3 2025. Fiscal 2025 revenue was $17.4M versus $20.6M in 2024 (down $3.2M or 16% YoY).
Read all updates
Q4-2025 Updates
Positive
Negative
Strategic Product Shift to SafePath OS and Enlarged TAM
Refocused product strategy on phones with SafePath OS for kids and seniors; senior-focused solution more than doubles the total addressable market and is cited as a key differentiator versus over-the-top apps.
Read all positive updates
Company Guidance
During the call management guided Q1 2026 consolidated revenue of approximately $4.2M–$4.5M and gross margin of 76%–78% (rising to 78%–80% after a full quarter of cost savings, with a long‑term target of 85%), said non‑GAAP operating expenses fell to $4.7M in Q4 (down ~19% YoY and ~17% sequentially) and are expected to decline another ~5% in Q1, and reiterated that a reduced GAAP loss is expected in Q1 and non‑GAAP profitability in Q2 and beyond; they highlighted cost savings of ~$1.8M per quarter vs Q2 2025 (a $7.2M run‑rate, excluding ~$600k of separation costs) and >$10M of annualized reductions, reported Q4 GAAP net loss $4.7M ($0.20/sh) and non‑GAAP net loss $2.1M ($0.09/sh), FY2025 GAAP net loss $30M ($1.46/sh) and non‑GAAP net loss $10.9M ($0.53/sh), cash of $1.5M at 12/31/25, $2.7M of Q4 financing closed, and an expected convertible note financing (including ~$4M from the Smiths plus roll‑overs of ~$585k and roughly half of $485k) to close imminently (note due March 2029); management also expects to add two carrier customers by mid‑2026.Smith Micro Software Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
46
Neutral
Cash Flow
22
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.36M | 20.55M | 40.86M | 48.51M | 58.42M |
| Gross Profit | 12.86M | 14.43M | 30.30M | 34.30M | 45.72M |
| EBITDA | -13.85M | -19.10M | -10.66M | -17.67M | -8.74M |
| Net Income | -30.10M | -48.70M | -24.40M | -29.28M | -31.04M |
Balance Sheet | |||||
| Total Assets | 24.97M | 48.05M | 85.58M | 103.58M | 114.51M |
| Cash, Cash Equivalents and Short-Term Investments | 1.49M | 2.81M | 7.13M | 14.03M | 16.08M |
| Total Debt | 2.34M | 2.57M | 3.26M | 13.42M | 5.87M |
| Total Liabilities | 6.58M | 7.29M | 10.19M | 27.20M | 13.95M |
| Stockholders Equity | 18.39M | 40.76M | 75.39M | 76.38M | 100.56M |
Cash Flow | |||||
| Free Cash Flow | -7.28M | -14.31M | -6.98M | -19.31M | -13.75M |
| Operating Cash Flow | -7.19M | -14.29M | -6.97M | -19.26M | -12.92M |
| Investing Cash Flow | 1.20M | 178.00K | 132.00K | 115.00K | -57.50M |
| Financing Cash Flow | 4.68M | 9.80M | -60.00K | 17.09M | 60.74M |
Smith Micro Software Technical Analysis
Neutral
0.72
Price Trends
0.62
Positive
0.61
Positive
0.69
Positive
Market Momentum
0.03
Positive
51.36
Neutral
20.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMSI, the sentiment is Neutral. The current price of 0.72 is below the 20-day moving average (MA) of 0.77, above the 50-day MA of 0.62, and above the 200-day MA of 0.69, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 51.36 is Neutral, neither overbought nor oversold. The STOCH value of 20.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SMSI.
Smith Micro Software Risk Analysis
Smith Micro Software disclosed 32 risk factors in its most recent earnings report. Smith Micro Software reported the most risks in the "Finance & Corporate" 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
UnderperformOutperform
Sector (61)
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Smith Micro Software
0.72
-0.04
-5.79%
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Smith Micro Software Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial DisclosuresPrivate Placements and Financing
Smith Micro Raises Insider-Backed Capital Amid Leadership Transition
Negative
Mar 4, 2026
On March 4, 2026, Smith Micro Software agreed to raise approximately $4.9 million through a private placement of secured convertible notes and accompanying warrants to accredited investors, including its CEO’s family trust and its COO/CFO, w...
Business Operations and StrategyPrivate Placements and Financing
Smith Micro Secures Insider Financing to Boost Liquidity
Neutral
Feb 5, 2026
On February 3, 2026, Smith Micro Software, Inc. entered into a secured financing arrangement with the Smith Living Trust, co‑trustees of which include chairman, president and CEO William W. Smith, Jr., under which the trust agreed to provide...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.