Smith Micro Software (NASDAQ:SMSI) Issues Quarterly Earnings Results

Smith Micro Software (NASDAQ:SMSI) released its earnings results on Thursday. The software maker reported ($0.05) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.46) by $0.41, FiscalAI reports. The company had revenue of $5.02 million for the quarter, compared to analysts’ expectations of $5.10 million. Smith Micro Software had a negative return on equity of 44.59% and a negative net margin of 92.60%.

Here are the key takeaways from Smith Micro Software’s conference call:

• Revenue growth continued: Q3 revenue rose 16% sequentially to $5.0 million, led by 18% growth in family safety revenue. Management forecast Q4 revenue of $5.4 million to $5.6 million, which would represent another sequential increase.
• Margins and operating performance improved: Gross margin reached 81.6%, a five-year high, while operating expenses declined year over year. The non-GAAP net loss narrowed to $281,000, though the company remained loss-making under GAAP.
• New and expanded customer agreements are contributing to growth: Smith Micro expanded a multi-year agreement with a Tier 1 customer and launched SafePath OS for Senior Phone with a U.S. carrier and SafePath Connect with Orange Belgium. A Tier 1 partner also launched SafePath Drive, which management said is already generating revenue.
• Management sees further growth opportunities in 2027: The company said its pipeline is growing, including signed SDK/API work that it expects to launch in the first half of 2027. These opportunities are prospective, and management did not quantify their expected contribution.
• Losses and limited cash remain concerns: The company reported a $1.7 million GAAP net loss for Q3 and had $2.4 million in cash and cash equivalents at quarter-end.

Smith Micro Software Price Performance

Smith Micro Software stock traded up $0.08 during mid-day trading on Thursday, reaching $2.40. The company had a trading volume of 26,910 shares, compared to its average volume of 72,406. The stock’s 50-day simple moving average is $2.56 and its 200-day simple moving average is $3.06. Smith Micro Software has a 1 year low of $2.05 and a 1 year high of $4.64. The company has a debt-to-equity ratio of 0.12, a current ratio of 1.45 and a quick ratio of 1.45. The company has a market capitalization of $13.42 million, a P/E ratio of -0.68 and a beta of 0.68.

Wall Street Analyst Weigh In

SMSI has been the topic of a number of recent analyst reports. Roth Capital reaffirmed a “buy” rating on shares of Smith Micro Software in a report on Thursday, September 10th. Weiss Ratings downgraded Smith Micro Software from a “sell (d-)” rating to a “sell (e+)” rating in a report on Thursday, October 29th. Two research analysts have rated the stock with a Buy rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company has an average rating of “Hold” and a consensus price target of $12.50.

Smith Micro Software Company Profile

Smith Micro Software, Inc. develops software solutions for wireless service providers and other communications companies. Its products are designed to help carriers offer value-added services to consumers, including family safety, mobile security, location sharing and communications management. The company’s principal product portfolio has included the SafePath platform, which provides tools such as parental controls, family location services, digital safety features and related mobile security capabilities.