SoundThinking cuts 2026 revenue guidance after Q2 call

SoundThinking (NASDAQ: SSTI ) reported second-quarter financial results on Thursday.

The transcript from the company's second-quarter earnings call has been provided below.

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The full earnings call is available at Summary SoundThinking's Q2 revenue was $23.9 million, with adjusted EBITDA moving from a negative $100,000 in Q1 to a positive $1.2 million in Q2, demonstrating effective cost management and AI-driven optimization.

The company secured over $23 million in total contract value through multi-year renewals and new deals, highlighting strong customer retention and satisfaction.

Revenue guidance for 2026 was revised downward to $99-$100 million from the previous $109-$111 million, due to delays in project timelines and elongated sales cycles, particularly for the ShotSpotter segment.

Despite the revenue shortfall, SoundThinking achieved approximately $4 million in annualized savings from workforce and business optimization initiatives.

The company continues to face challenges with elongated sales cycles and political scrutiny affecting ShotSpotter deployments, but remains confident in underlying demand and future expansion opportunities.

Full Transcript Cleo, Operator Good afternoon and welcome to SoundThinking's second quarter 2026 earnings conference call.

My name is Cleo and I will be your operator for today's call.

Joining us are SoundThinking CEO Ralph Clark and CFO Alan Stewart.

Please note that certain information discussed on today's call will include forward-looking statements for future events and SoundThinking's business strategy and future financial and operating performance.

These forward-looking statements are only predictions and they are subject to risks, uncertainties, and assumptions that are difficult to predict and may cause actual results to differ materially from those stated or implied by these statements.

Certain of these risks, uncertainties, and assumptions are discussed in SoundThinking's SEC filings, including its most recent annual report on Form 10-K and other SEC filings.

These forward-looking statements reflect management's beliefs, estimates, and predictions as of the date of this live broadcast, August 13, 2026, and SoundThinking undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call.

In addition, our comments on the call today contain references to non-GAAP financial measures such as adjusted EBITDA and key business metrics such as annual recurring revenue.

Non-GAAP measures should be reviewed in addition to and not as alternatives for the company's reported GAAP results.

A reconciliation of these non-GAAP measures to their most directly comparable GAAP measures, as well as definitions of the key business metrics referenced and management's reasons for including the non-GAAP measures and key business metrics referenced may be found in the press release.

Finally, I would like to remind everyone that this call will be recorded and made available for replay via a link available in the Investor Relations section of the company's website at ir.soundthinking.com.

With that, I will now turn the call over to Ralph.

Ralph Clark, President & CEO Good afternoon and thank you for joining us.

I want to start today's call in an unusual place by going back to last quarter's call.

In Q1 we discussed several strategic initiatives that we believed would shape our year.

I want to review those strategic initiatives and share where we delivered and where we fell short and more importantly what we are doing on a go forward basis.

Let's start on where we delivered.

I told you our year had structural shape and that Q1 sat below our operating leverage line and that Q2 through Q4 would sit above it with incremental revenue converting to adjusted EBITDA despite sequential flattish revenue growth.

We crossed that line in Q2.

Adjusted EBITDA moved from roughly negative $100,000 in the first quarter to a positive $1.2 million in the second quarter.

We've been aggressively applying AI across our own operations and that is a meaningful part of why we believe the workforce and business optimization initiatives we actioned this year from which we expect approximately $4 million of annualized savings, is structural rather than a one time cut.

This was not a headcount reduction dressed up as strategy.

We believe it is a lower, more scalable cost base that lets us intentionally reduce our expense burn going forward while protecting the investments that drive growth.

Our cost discipline can cushion the profitability impact of a lighter top line.

We believe it is a durable advantage, not a 1/4 maneuver.

Revenue retention continues to be a business model differentiator for us as we drive revenue renewals.

To protect the revenue growth gains, we closed more than $23 million in total contract value across several multi year renewals, a 5 year ShotSpotter renewal with Albuquerque covering approximately 42 square miles, 3 year ShotSpotter renewals with Worcester, Massachusetts, Richland County, South Carolina, Macomb, Bibb, Georgia, Peoria, Illinois and a 2 year CrimeTracer renewal with the Massachusetts State Police.