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SoundThinking Inc (SSTI)
NASDAQ:SSTI
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SoundThinking Inc
(NASDAQ:SSTI)
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Rating:49Neutral
Price Target:
$7.50
▼(-16.29% Downside)
SoundThinking Inc's overall stock score reflects significant financial challenges, including declining revenues and profitability issues. While technical indicators suggest a bearish trend, there are some positive developments in AI adoption and international expansion. However, the negative valuation metrics and reduced guidance weigh heavily on the stock's attractiveness.
Positive Factors
AI Adoption
The adoption of AI tools enhances product offerings and operational efficiency, potentially driving long-term growth and competitive advantage.
International Expansion
International expansion into Latin America opens new revenue streams and diversifies market risk, supporting long-term growth prospects.
Customer Satisfaction
High customer satisfaction and retention rates indicate strong product-market fit and can lead to sustained revenue through renewals and referrals.
Negative Factors
Revenue Decline
Declining revenue suggests challenges in maintaining market share and growth, potentially impacting long-term financial stability.
Contract Delays
Contract delays can disrupt cash flow and revenue recognition, affecting financial performance and operational planning.
Increased R&D Expenses
Rising R&D costs may pressure margins if not offset by revenue growth, impacting profitability and financial health.
SoundThinking Inc (SSTI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$113.78M
Dividend YieldN/A
Average Volume (3M)177.69K
Price to Earnings (P/E)―
Beta (1Y)1.15
Revenue Growth-1.83%
EPS Growth-642.89%
CountryUS
Employees316
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.16
Shares Outstanding12,698,453
10 Day Avg. Volume175,563
30 Day Avg. Volume177,692
Financial Highlights & Ratios
PEG Ratio-0.08
Price to Book (P/B)2.29
Price to Sales (P/S)1.63
P/FCF Ratio10.51
Enterprise Value/Market Cap1.30
Enterprise Value/Revenue1.44
Enterprise Value/Gross Profit2.64
Enterprise Value/Ebitda-315.85
Forecast
1Y Price Target
$14.20Price Target Upside58.48% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
SoundThinking Inc Business Overview & Revenue Model
Company DescriptionSoundThinking, Inc., a public safety technology company, provides data-driven solutions and strategic advisory services for law enforcement, security teams, and civic leadership. Its SafetySmart platform that includes data-driven tools comprising ShotSpotter, an outdoor gunshot detection, location, and alerting system; CrimeTracer, a law enforcement search engine that enables investigators to search through criminal justice records from across jurisdictions to generate tactical leads and solve cases; CaseBuilder, an investigative management system for tracking, reporting, and collaborating on cases; ResourceRouter, a software that directs deployment of patrol and community anti-violence resources; PlateRanger powered by Rekor, an advanced license plate recognition (ALPR) and vehicle identification solution; and SafePointe, an artificial intelligence-based weapons detection system. The company also offers ShotSpotter for Campus and ShotSpotter for Corporate, to universities, corporate campuses, and key infrastructure centers to mitigate risk and enhance security by notifying authorities of outdoor gunfire incidents and save critical minutes for first responders to arrive. It sells its solutions through its direct sales teams. The company was formerly known as ShotSpotter, Inc. and changed its name to SoundThinking, Inc. in April 2023. SoundThinking, Inc. was founded in 1996 and is headquartered in Fremont, California.
How the Company Makes MoneySoundThinking Inc generates revenue through multiple streams, primarily by selling software licenses for its audio analytics platforms and providing subscription-based services for ongoing support and updates. Key revenue streams include direct sales to government agencies, law enforcement, and private security firms, as well as partnerships with technology providers for integrated solutions. Additionally, SSTI earns income through consulting services aimed at customizing their offerings for specific client needs and conducting training programs for end-users. Significant collaborations with municipalities and public safety organizations further enhance its market presence and contribute to its earnings.
SoundThinking Inc Earnings Call Summary
Earnings Call Date:Nov 12, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 24, 2026
Earnings Call Sentiment Negative
While there were significant advancements in AI adoption, international expansion, and customer satisfaction, these were overshadowed by reduced revenue guidance, sales execution challenges, and significant contract delays.Q3-2025 Updates
Positive Updates
AI-Powered Investigative Tools Adoption
Accelerated adoption of AI-powered investigative tools and the upcoming launch of Crime Tracer Gen 3, which integrates over 1 billion records and features voice-enabled AI chatbot capabilities.
Healthcare Security Market Growth
Growing traction in the healthcare security market with California's AB 2,975 mandate driving interest in SafePoint weapons detection technology.
International Expansion
Meaningful progress in international expansion, notably in Uruguay and Brazil, indicating potential for broader market opportunities in Latin America.
Data for Good Initiative
Expansion of the Data for Good initiative to multiple cities, facilitating secure sharing of gunfire and crime data with community violence intervention groups.
Customer Retention and Satisfaction
Improved customer retention and satisfaction, with an NPS score of +70, up four points from last year, and over 90% satisfaction in critical partnership areas.
Negative Updates
Revenue and EBITDA Guidance Reduction
Lowered full-year revenue guidance from $111-113 million to approximately $104 million and adjusted EBITDA guidance from 20-22% to 14-15% due to delays in contract bookings.
Sales Execution Challenges
Issues with converting pipeline demand into bookings, leading to organizational realignment and interim sales leadership changes.
Contract Delays
Delays in significant contracts, including a $2.5 million deployment in Brazil and a $1.4 million renewal in Puerto Rico, impacting revenue.
Decreased Revenue and Profit Margins
Third-quarter revenue fell by 4% to $25.1 million, with gross profit margins decreasing from 58% to 54% compared to the prior year.
Increased R&D Expenses
R&D expenses increased to 16% of total revenue from 13% the previous year, reflecting heightened AI investment costs.
Company Guidance
During SoundThinking's Third Quarter 2025 Earnings Conference Call, the company lowered its full-year revenue guidance from $111-$113 million to approximately $104 million and adjusted EBITDA guidance from 20%-22% to 14%-15%, citing delays in several large contracts. The third-quarter revenue was $25.1 million, a 4% decrease from the previous year, attributed to the absence of a ShotSpotter renewal in Puerto Rico and a delayed Crime Tracer booking. Despite these setbacks, SoundThinking highlighted encouraging developments such as expanded deployments of ShotSpotter technology, international expansion efforts, and the launch of Crime Tracer Gen 3. The company also noted strong momentum for its SafePoint technology following California's weapons detection mandate and reported a Net Promoter Score of 70, with over 90% satisfaction in key partnership areas. SoundThinking remains optimistic about its medium to long-term prospects, expecting revenue growth of $114-$116 million and an adjusted EBITDA margin of 18%-20% in 2026.SoundThinking Inc Financial Statement Overview
Summary
SoundThinking Inc is facing financial challenges with declining revenues and profitability issues. The income statement shows a negative revenue growth rate and ongoing losses. The balance sheet is stable with low leverage, but cash flow trends are negative, indicating cash flow management issues.Income Statement
SoundThinking Inc's income statement shows a declining revenue trend with a negative revenue growth rate of -1.11% TTM. The company is facing profitability challenges, as evidenced by negative net profit and EBIT margins. Gross profit margin remains relatively stable at 54.43% TTM, but the negative net profit margin of -10.44% indicates ongoing losses. The company needs to address its cost structure and improve revenue generation to enhance profitability.Balance Sheet
The balance sheet of SoundThinking Inc reflects a low debt-to-equity ratio of 0.066 TTM, indicating conservative leverage. However, the return on equity is negative at -14.58% TTM, highlighting inefficiencies in generating returns for shareholders. The equity ratio is healthy, suggesting a strong capital base, but the company needs to improve its profitability to enhance shareholder value.Cash Flow
SoundThinking Inc's cash flow statement reveals a significant decline in free cash flow growth rate of -116.20% TTM, indicating cash flow challenges. The operating cash flow to net income ratio is low at 0.073 TTM, suggesting difficulties in converting earnings into cash. The company must focus on improving its cash flow management to support operations and future growth.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 102.75M | 102.03M | 92.72M | 81.00M | 58.16M | 45.73M |
| Gross Profit | 55.92M | 58.49M | 52.84M | 46.78M | 32.52M | 27.21M |
| EBITDA | -468.00K | 2.60M | 9.17M | 7.79M | 4.09M | 7.11M |
| Net Income | -10.73M | -9.18M | -2.72M | 6.38M | -4.43M | 1.23M |
Balance Sheet | ||||||
| Total Assets | 134.43M | 136.79M | 140.94M | 122.75M | 72.30M | 66.32M |
| Cash, Cash Equivalents and Short-Term Investments | 11.83M | 13.18M | 5.70M | 10.48M | 15.64M | 16.04M |
| Total Debt | 5.76M | 6.05M | 9.51M | 3.42M | 2.42M | 945.00K |
| Total Liabilities | 60.88M | 64.39M | 66.18M | 61.80M | 38.49M | 32.01M |
| Stockholders Equity | 73.55M | 72.40M | 74.76M | 60.95M | 33.81M | 34.30M |
Cash Flow | ||||||
| Free Cash Flow | -1.07M | 15.79M | 5.46M | 1.26M | 1.92M | 7.08M |
| Operating Cash Flow | 3.95M | 22.22M | 10.95M | 12.18M | 9.82M | 11.21M |
| Investing Cash Flow | -5.03M | -6.43M | -16.48M | -15.54M | -7.88M | -18.76M |
| Financing Cash Flow | -2.30M | -8.25M | 795.00K | -1.75M | -2.27M | -956.00K |
SoundThinking Inc Technical Analysis
Neutral
8.96
Price Trends
7.66
Positive
9.84
Negative
12.27
Negative
Market Momentum
0.28
Negative
67.80
Neutral
90.91
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSTI, the sentiment is Neutral. The current price of 8.96 is above the 20-day moving average (MA) of 8.05, above the 50-day MA of 7.66, and below the 200-day MA of 12.27, indicating a neutral trend. The MACD of 0.28 indicates Negative momentum. The RSI at 67.80 is Neutral, neither overbought nor oversold. The STOCH value of 90.91 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SSTI.
SoundThinking Inc Risk Analysis
SoundThinking Inc disclosed 56 risk factors in its most recent earnings report. SoundThinking Inc reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SoundThinking Inc Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $346.24M | -5.12 | -25.48% | ― | -24.30% | -181.62% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $133.96M | 11.36 | 18.24% | ― | 0.59% | ― | |
49 Neutral | $113.78M | -10.58 | -14.61% | ― | -1.83% | -642.89% | |
48 Neutral | $116.24M | -32.77 | -54.03% | ― | 18.57% | -2.15% | |
47 Neutral | $56.67M | -0.94 | -451.95% | ― | 35.79% | 14.85% | |
45 Neutral | $169.22M | -1.89 | ― | ― | ― | ― |
* Technology Sector Average
SSTI
SoundThinking Inc
8.96
-3.59
-28.61%
AEYE
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9.36
-5.42
-36.67%
MAPS
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0.85
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-35.94%
SMRT
SmartRent
1.83
0.25
15.82%
PSQH
PSQ Holdings
1.14
-2.80
-71.07%
MRT
Marti Technologies
2.15
-1.30
-37.68%
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.