SoundThinking (SSTI) investor relations material

Business overview and growth strategy

• Focused on AI and data-driven public safety solutions for law enforcement and security professionals.

• SafetySmart platform integrates gunshot detection, patrol management, license plate reading, case management, and weapons detection.

• Revenue diversification strategy aims to reduce reliance on gunshot detection from 65% to 35% over the medium term.

• International expansion, especially in Latin America, offers significant pricing leverage and growth potential.

• Growth levers include new customer acquisition, upselling, cross-selling, and strategic tuck-in acquisitions.

Product innovation and technology

• ShotSpotter provides real-time, precise alerts for gunfire, addressing the issue of underreported gun violence.

• Technology achieves 97% accuracy, independently audited, with alerts delivered within 30-45 seconds.

• ResourceRouter uses AI to optimize patrol deployment, reducing bias and increasing presence effectiveness.

• CaseBuilder and CrimeTracer enhance case management and investigative analytics, with future plans for generative AI integration.

• SafePointe offers frictionless weapons detection for commercial clients, targeting hospitals and casinos.

Financial performance and outlook

• 2022 revenue was $102 million with 14% adjusted EBITDA; 2023 guidance is $111–$113 million revenue and 20–22% adjusted EBITDA.

• SaaS and managed services comprise 95% of revenue, with high net revenue retention and low customer acquisition cost ($0.63 per $1 ACV).

• Gross margin and adjusted EBITDA are expected to rise as cost of goods sold and OpEx remain flat while revenue grows.

• Long-term model targets 15% annual revenue growth, 70% gross margin, and 40%+ adjusted EBITDA, driven by SafePointe and international sales.

• Strong cash generation, no debt, and history of share repurchases and acquisitions support future growth.