Smith Micro Software (NASDAQ:SMSI) reported second-quarter 2026 revenue of $4.3 million, up 3% sequentially, as the company cited growing demand for its family-safety platform and projected further growth in the third quarter.
President and CEO Tim Huffmyer said the quarter marked the company’s second consecutive period of sequential revenue growth, something Smith Micro had not achieved in approximately five years. He said delayed customer launches and a contract extension pushed some expected second-quarter revenue into the third quarter.
Revenue, Margins and Expenses
Second-quarter revenue of $4.3 million was down 2% from $4.4 million in the year-earlier period but increased $120,000 from the first quarter. Revenue for the first six months of 2026 was $8.6 million, compared with $9 million in the comparable period of 2025.
SafePath revenue totaled $3.5 million, down 3% year over year but up 3% sequentially. CommSuite revenue was $826,000, increasing $49,000 from the prior-year quarter and $26,000 sequentially.
Chief Financial Officer Bethany Braund said the company expects third-quarter revenue of $5 million to $5.4 million. Smith Micro expects gross margin of 81% to 83% in the third quarter, after reporting a second-quarter gross margin of 81.3%, compared with 73.5% a year earlier.
Gross profit rose 9% year over year to $3.5 million, which Braund attributed to revenue performance and lower costs of revenue resulting from the company’s cost-reduction efforts. She said the company’s gross margin exceeded 80% for the first time in five years and that Smith Micro continues to target a longer-term gross margin of 85%.
GAAP operating expenses were $5.9 million, down 68% from the second quarter of 2025. Excluding prior-year one-time items, including a goodwill impairment and a gain on the sale of ViewSpot, operating expenses fell 30%, according to Braund. Non-GAAP operating expenses declined 26% year over year to $4.4 million and fell 8% from the first quarter.
The company expects non-GAAP operating expenses to rise by as much as 6% in the third quarter as it adds resources to support its sales pipeline. Huffmyer said those additions are primarily focused on engineering resources.
Smith Micro reported a GAAP net loss attributable to common stockholders of $2.7 million, or 52 cents per share, for the second quarter. Its non-GAAP net loss was $989,000, or 19 cents per share. Braund noted that per-share figures reflect the company’s one-for-five reverse stock split, which shareholders approved in May and which took effect in June.
Customer Launches and Tier 1 Expansion
Huffmyer said Smith Micro expects two new customer launches within about a month. One will be a SafePath OS deployment with a U.S. carrier, while the other will involve the company’s newly announced SafePath Connect offering for a European customer.
The company did not disclose whether its SafePath OS deployment is targeted at children or seniors, saying it will provide additional information alongside the customer’s marketing activity.
SafePath Connect is a Smith Micro-branded family-safety product that can be promoted and paid for by carriers or other partners. Unlike the company’s traditional white-label carrier deployments, which Huffmyer said can require months of work and meaningful carrier investment, SafePath Connect is distributed through Smith Micro’s app-store channels.
Huffmyer said the company plans to launch SafePath Connect in the United States in coming months and sees the product as a way to serve a broader group of partners beyond wireless carriers.
The company also said it is nearing completion of a multiyear contract extension with an existing Tier 1 carrier. Huffmyer said the arrangement will expand SafePath capabilities and is expected to begin contributing revenue in the third quarter.
- Smith Micro is working to expand the feature set of an existing family-safety application for a Tier 1 carrier, which it expects to increase its revenue share after deployment in the next month.
- The company is in advanced development of an expanded application for a European customer that will support iOS phones in addition to Android devices.
- Management said the European deployment could broaden that customer’s addressable market and accelerate revenue growth once launched.
SDKs, APIs and New Markets
Management highlighted new SafePath software development kits and application programming interfaces as a potential growth driver. The offerings allow partners to incorporate family-safety capabilities into their own applications, including what Executive Chairman Bill Smith described as “super apps” being developed by larger carriers and mobile virtual network operators.
Bill Smith said the SDK model remains software-as-a-service based and could involve better pricing as partners reach multiyear, multimillion-subscriber scale. He said the company’s platform is built on the same code base as its broader SafePath portfolio and has a feature set developed through internal work and past acquisitions.
Huffmyer said Smith Micro faces competition but aims to differentiate through carrier-grade service and a broader feature set rather than competing on price. He added that interest in senior-focused offerings remains strong, and he described the senior opportunity as currently stronger than the children’s operating-system opportunity.
As of June 30, Smith Micro had $2.8 million in cash and cash equivalents. During June, the company completed a warrant inducement transaction that generated $1.6 million in proceeds from the exercise of warrants for 487,349 shares at $3.35 per share. The company issued new five-year warrants for the same number of shares as part of that transaction.
About Smith Micro Software (NASDAQ:SMSI)
Smith Micro Software, Inc, headquartered in Aliso Viejo, California, is a global provider of enterprise software solutions specializing in mobility management, device security and digital content distribution. Since its founding in 1982, Smith Micro has focused on delivering tools that enable wireless network operators, enterprises and software publishers to optimize performance, secure assets and manage licensing and distribution of digital media and applications.
Within its mobility and security segment, Smith Micro offers platforms for network offload, application acceleration, secure Wi-Fi connectivity and device management.
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