0000948708FALSE00009487082024-08-012024-08-01


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 1, 2024
Smith Micro Software, Inc.
(Exact name of Registrant as Specified in Its Charter)
Delaware001-3552533-0029027
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
5800 Corporate Drive
Pittsburgh, PA
15237
(Address of Principal Executive Offices)
 
(Zip Code)
Registrant’s Telephone Number, Including Area Code: (412) 837-5300
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:

Title of each class 
Trading
Symbol(s)
 Name of each exchange on which registered
Common Stock, par value $0.001 per share SMSI NASDAQ
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐




Item 2.02Results of Operations and Financial Condition
On August 1, 2024, Smith Micro Software, Inc. issued a press release announcing its financial results for the three and six months ended June 30, 2024. A copy of the press release is hereby furnished to the Securities and Exchange Commission as Exhibit 99.1 and incorporated by reference herein.
In accordance with General Instruction B.2 of Form 8-K, the information in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section and will not be incorporated by reference into any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
Item 7.01Regulation FD
The information set forth under Item 2.02 is incorporated into this Item 7.01 by reference.
Item 9.01.Financial Statements and Exhibits.
(d) Exhibits
ExhibitDescription
99.1
Press Release issued on August 1, 2024
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Smith Micro Software, Inc.
Date: August 1, 2024
By:/s/ James M. Kempton
James M. Kempton
Vice President, Chief Financial Officer and Treasurer


Exhibit 99.1
gnyzmd4ldoop000001.jpg
IR INQUIRIES:
Charles Messman
Investor Relations
949-362-5800
IR@smithmicro.com
Smith Micro Reports Second Quarter 2024 Financial Results
PITTSBURGH, PA, August 1, 2024 – Smith Micro Software, Inc. (Nasdaq: SMSI) (“Smith Micro” or the “Company”) today reported financial results for its second quarter ended June 30, 2024.
“With the commercial launch of Boost Family Guard during the second quarter, our continued progress towards the upcoming launch of a SafePath®-based Family Safety solution with a tier one carrier in Europe, and our cost reduction initiatives, we believe we are making progress toward a return to growth, profitability and free cash flow,” said William W. Smith Jr., president, chief executive officer, and chairman of the board of Smith Micro. “We have a solid base to build from and believe we are driving toward meaningful subscriber growth across multiple carrier customers.”

“We remain confident that the business case for SafePath is strong,” Smith continued. “It is our core belief that the overall Family Safety market is expanding, particularly in the current environment as we continue to see new initiatives and legislation across the United States and around the world with a clear focus on online safety. We plan to capitalize on this momentum and leverage it to expand the reach of our solutions.”
Second Quarter 2024 Financial Results
Smith Micro reported revenue of $5.1 million for the quarter ended June 30, 2024, compared to $10.3 million reported in the quarter ended June 30, 2023.
Gross profit for the quarter ended June 30, 2024 was $3.5 million, compared to $7.7 million for the quarter ended June 30, 2023.
Gross profit as a percentage of revenue was 68.7 percent for the quarter ended June 30, 2024, compared to 75.0 percent for the quarter ended June 30, 2023.
GAAP net loss for the quarter ended June 30, 2024 was $6.9 million, or $0.66 loss per share, compared to GAAP net loss of $5.7 million, or $0.73 loss per share, for the quarter ended June 30, 2023.
Non-GAAP net loss for the quarter ended June 30, 2024 was $4.0 million, or $0.38 loss per share, compared to non-GAAP net loss of $0.6 million, or $0.08 loss per share, for the quarter ended June 30, 2023. Non-GAAP net loss excludes the items noted below under "Non-GAAP Measures."
All share and per share amounts for common stock herein have been retroactively adjusted for all periods presented to give effect to the one-for-eight reverse stock split of our common stock, which became effective April 10, 2024 at 11:59 pm Eastern time.

Smith Micro Software Second Quarter 2024 Financial Results
Page 2
Second Quarter Year-to-Date 2024 Financial Results
Smith Micro reported revenue of $10.9 million for the six months ended June 30, 2024, compared to $21.3 million reported in the six months ended June 30, 2023.
Gross profit for the six months ended June 30, 2024 was $7.3 million compared to $15.4 million reported for the same period in 2023.
Gross profit as a percentage of revenue was 67.1 percent for the six months ended June 30, 2024 compared to 72.4 percent for the six months ended June 30, 2023.
GAAP net loss for the six months ended June 30, 2024 was $37.9 million, or $3.79 loss per share, compared to GAAP net loss of $12.6 million, or $1.68 loss per share, for the six months ended June 30, 2023.
Non-GAAP net loss for the six months ended June 30, 2024 was $8.2 million, or $0.82 loss per share, compared to non-GAAP net loss of $4.2 million, or $0.57 loss per share, for the six months ended June 30, 2023. Non-GAAP net loss excludes the items noted below under "Non-GAAP Measures."
Total cash and cash equivalents as of June 30, 2024 were $5.6 million.

Non-GAAP Measures

To supplement our financial information presented in accordance with GAAP, the Company considers, and has included in this press release, the following non-GAAP financial measures and a non-GAAP reconciliation from the equivalent GAAP metric: non-GAAP net (loss) income, non-GAAP gross profit, and non-GAAP basic and diluted (loss) earnings per share in the presentation of financial results in this press release. Management believes this non-GAAP presentation may be more meaningful in analyzing the Company's income generation and has therefore excluded the following items from GAAP earnings calculations: stock compensation, intangibles amortization, depreciation, fair value adjustments, amortization of debt issuance costs and discount, goodwill impairment, personnel severance and reorganization activities, and adjustment for non-recurring items. Additionally, since the Company currently has federal and state net operating loss carryforwards that can be utilized to reduce future cash payments for income taxes, these non-GAAP adjustments have not been tax effected, and the resulting income tax expense reflects actual taxes paid or accrued during each period. This presentation may be considered more indicative of the Company's ongoing operational performance. The table below presents the differences between non-GAAP net loss and net loss on an absolute and per-share basis. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and the non-GAAP financial measures as reported by Smith Micro may not be comparable to similarly titled amounts reported by other companies.
Investor Conference Call
Smith Micro will hold an investor conference call today, August 1, 2024, at 4:30 p.m. ET, to discuss the Company’s second quarter 2024 financial results. To access the call, dial 1-844-701-1164; international participants can call 1-412-317-5492. A passcode is not required to join the call; ask the operator to be placed into the Smith Micro conference. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. An internet webcast is available at https://event.choruscall.com/mediaframe/webcast.html?webcastid=edjfF2vT. In addition, the conference call will be available on the Smith Micro website in the Investor Relations section.

Smith Micro Software Second Quarter 2024 Financial Results
Page 3
About Smith Micro Software, Inc.
Smith Micro develops software to simplify and enhance the mobile experience, providing solutions to some of the leading wireless service providers around the world. From enabling the family digital lifestyle to providing powerful voice messaging capabilities, our solutions enrich today’s connected lifestyles while creating new opportunities to engage consumers via smartphones and consumer IoT devices. The Smith Micro portfolio also includes a wide range of products for creating, sharing, and monetizing rich content, such as visual voice messaging, optimizing retail content display and performing analytics on any product set. For more information, visit www.smithmicro.com.
Smith Micro, the Smith Micro logo and SafePath are registered trademarks or trademarks of Smith Micro Software, Inc. All other trademarks and product names are the property of their respective owners.
Forward-Looking Statements
Certain statements in this press release are, and certain statements on the related conference call may be, forward-looking statements regarding future events or results within the meaning of the Private Securities Litigation Reform Act, including statements related to our financial prospects, goals and other projections of our outlook or performance our cost reduction plans and other future business plans, and statements using such words as “expect,” “anticipate,” “believe,” “plan,” “intend,” “could,” “will” and other similar expressions. Forward-looking statements involve risks and uncertainties, which could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Among the important factors that could cause or contribute to such differences are customer concentration, given that the majority of our sales depend on a few large customer relationships and the loss of any of them could materially and negatively affect our business, delay or failure of our customers to accept and deploy our products and services or new or upgraded versions thereof, delay or failure of our customers’ end users to adopt our products and services or new or upgraded versions thereof, our reliance on third party operating systems for the proper operation and delivery of our solutions and any barriers to our use of such third party technology, our reliance on third party application stores for the distribution of our software applications to users and any barriers to such distribution, including any delay or failure of such third party to approve new versions of our applications or their implementation and/or application of policies that may be harmful to our business, unanticipated delays or obstacles in our development and release cycles, the degree to which competing business needs may affect our allocation of resources to planned projects, delays in our ability to fully execute on our cost reduction plans due to statutory and other requirements, the risk of harm to our business resulting from our recent and any future cost reduction efforts, our ability to attract and retain key technical personnel that are essential to our product development and support efforts, changes in demand for our products from our customers and their end users, changes in requirements for our products imposed by our customers or by the third party providers of software and/or platforms that we use, our ability to effectively integrate, market and sell acquired product lines, new and changing technologies and customer acceptance and timing of deployment of those technologies, and our ability to compete effectively with other software and technology companies. These and other factors discussed in our filings with the Securities and Exchange Commission, including our filings on Forms 10-K and 10-Q, could cause actual results to differ materially from those expressed or implied in any forward-looking statements. The forward-looking statements contained in this release are made on the basis of the views and assumptions of management, and we do not undertake any obligation to update these statements to reflect events or circumstances occurring after the date of this release.



Smith Micro Software Second Quarter 2024 Financial Results
Page 4
Smith Micro Software, Inc.  
Consolidated Balance Sheets 
(in thousands except share and par value data)  
 
 June 30,
2024		December 31,
2023
 (unaudited)(audited)
Assets
Current assets:
Cash and cash equivalents$5,628 $7,125 
Accounts receivable, net of related allowances of $3 and $3 at 2024 and 2023, respectively
3,824 7,912 
Prepaid expenses and other current assets2,055 1,843 
Total current assets11,507 16,880 
Equipment and improvements, net701 883 
Right-of-use assets2,955 2,759 
Other assets511 482 
Intangible assets, net26,265 29,532 
Goodwill11,052 35,041 
Total assets$52,991 $85,577 
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable$2,338 $2,522 
Accrued payroll and benefits2,612 2,500 
Current operating lease liabilities1,226 1,483 
Other current liabilities1,367 1,137 
Total current liabilities7,543 7,642 
Non-current liabilities:
Warrant liabilities369 597 
Operating lease liabilities2,009 1,780 
Deferred tax liabilities, net168 168 
Total non-current liabilities2,546 2,545 
Commitments and contingencies
Stockholders' equity:
Common stock, par value $0.001 per share; 100,000,000 shares authorized; 10,625,467 and 9,347,979 shares issued and outstanding 2024 and 2023, respectively
11 9 
Additional paid-in capital386,775 381,329 
Accumulated comprehensive deficit(343,884)(305,948)
Total stockholders’ equity42,902 75,390 
Total liabilities and stockholders' equity$52,991 $85,577 



Smith Micro Software Second Quarter 2024 Financial Results
Page 5
Smith Micro Software, Inc.
Consolidated Statements of Operations
(in thousands except share data)
For the Three Months Ended
June 30,		For the Six Months Ended
June 30,
2024202320242023
(unaudited)(unaudited)(unaudited)(unaudited)
Revenues$5,140 $10,338 $10,938 $21,268 
Cost of revenues (including depreciation of $4, $13, $11, and $27 in the three and six months ended June 30, 2024 and 2023, respectively)
1,607 2,589 3,595 5,871 
Gross profit3,533 7,749 7,343 15,397 
Operating expenses:
Selling and marketing2,529 2,628 5,143 6,182 
Research and development3,702 3,705 7,691 9,573 
General and administrative2,740 3,040 5,496 6,515 
Depreciation and amortization1,541 1,620 3,449 3,305 
Goodwill impairment
— — 23,989 — 
Total operating expenses10,512 10,993 45,768 25,575 
Operating loss(6,979)(3,244)(38,425)(10,178)
Other income (expense):
Change in fair value of warrant and derivative liabilities42 429 227 3,413 
Loss on derecognition of debt— (775)— (1,402)
Interest income (expense), net
26 (2,037)100 (4,297)
Other (expense) income, net
(18)(36)201 (76)
Loss before provision for income taxes(6,929)(5,663)(37,897)(12,540)
Provision for income tax expense— 2 39 11 
Net loss$(6,929)$(5,665)$(37,936)$(12,551)
Loss per share:
Basic and diluted$(0.66)$(0.73)$(3.79)$(1.68)
Weighted average shares outstanding:
Basic and diluted10,567 7,807 10,016 7,466 




Smith Micro Software Second Quarter 2024 Financial Results
Page 6
Smith Micro Software, Inc.
Consolidated Statements of Cash Flows
(in thousands)
 
 For the Six Months Ended
June 30,
 20242023
 (unaudited)(unaudited)
Operating activities:
Net loss$(37,936)$(12,551)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization3,460 3,332 
Goodwill impairment charge
23,989 — 
Non-cash lease expense(224)(78)
Change in fair value of warrant and derivative liabilities(227)(3,413)
Loss on derecognition of debt— 1,402 
Amortization of debt discount and issuance costs— 4,055 
Stock based compensation2,272 1,975 
Gain on license of patents, net
(198)— 
Gain on disposal of assets
— 11 
Changes in operating accounts:
Accounts receivable4,087 (1,373)
Prepaid expenses and other assets(241)69 
Accounts payable and accrued liabilities(505)(1,542)
Other liabilities(30)622 
Net cash used in operating activities
(5,553)(7,491)
Investing activities:
Capital expenditures, net(11)3 
Other investing activities, net
198 71 
Net cash provided by investing activities
187 74 
Financing activities:
Proceeds from Common Stock, Warrants, and Pre-Funded Warrants Offering, net
3,351 — 
Proceeds from financing arrangements1,044 442 
Repayments of financing arrangements(529)(642)
Other financing activities3 8 
Net cash provided by (used in) financing activities
3,869 (192)
Net decrease in cash and cash equivalents
(1,497)(7,609)
Cash and cash equivalents, beginning of period7,125 14,026 
Cash and cash equivalents, end of period$5,628 $6,417 

Smith Micro Software Second Quarter 2024 Financial Results
Page 7
Smith Micro Software, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share data) - unaudited
 GAAPStock CompensationIntangibles AmortizationDepreciationFair Value AdjustmentsAmortization of Debt Issuance Costs and DiscountPersonnel Severance and Reorganization Activities
Adjustment for Non-Recurring Items
Non-GAAP
Three Months Ended
June 30, 2024		   
Gross profit$3,533 $— $— $4 $— $— $11 $— $3,548 
Selling and marketing2,529 (345)— — — — (141)— 2,043 
Research and development3,702 (245)— — — — (71)— 3,386 
General and administrative2,740 (548)— — — — (20)(68)2,104 
Depreciation and amortization1,541 — (1,450)(91)— — — — — 
Total operating expenses$10,512 $(1,138)$(1,450)$(91)$— $— (232)(68)$7,533 
(Loss) Income before provision for income taxes
$(6,929)$1,138 $1,450 $95 $(42)$— 243 68 $(3,977)
Net (Loss) Income
$(6,929)$1,138 $1,450 $95 $(42)$— 243 68 $(3,977)
(Loss) earnings per share: basic and diluted
$(0.66)$0.11 $0.14 $0.01 $— $— 0.02 $0.01 $(0.38)

    
Three Months Ended
June 30, 2023		   
Gross profit$7,749 $— $— $13 $— $— $— $— $7,762 
Selling and marketing2,628 (190)— — — — — — 2,438 
Research and development3,705 (240)— — — — (9)— 3,456 
General and administrative3,040 (600)— — — — (75)— 2,365 
Depreciation and amortization1,620 — (1,491)(129)— — — — — 
Total operating expenses$10,993 $(1,030)$(1,491)$(129)$— $— $(84)$— $8,259 
(Loss) Income before provision for income taxes
$(5,663)$1,030 $1,491 $142 $346 $1,938 $84 $— $(632)
Net (Loss) Income$(5,665)$1,030 $1,491 $142 $346 $1,938 $84 $— $(634)
(Loss) earnings per share: basic and diluted
$(0.73)$0.13 $0.19 $0.02 $0.04 $0.25 $0.01 $— $(0.08)
Note: (Loss) earnings per share: basic and diluted - may be impacted by rounding to allow rows to calculate.





Smith Micro Software Second Quarter 2024 Financial Results
Page 8
Smith Micro Software, Inc. 
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share data) - unaudited
GAAPStock CompensationIntangibles AmortizationDepreciationFair Value AdjustmentsAmortization of Debt Issuance Costs and Discount
Goodwill Impairment
Personnel Severance and Reorganization Activities
Adjustment for Non-Recurring Items
Non-GAAP
Six Months Ended
June 30, 2024		   
Gross profit$7,343 $— $— $11 $— $— $— $11 $— $7,365 
Selling and marketing5,143 (653)— — — — $— (153)— 4,337 
Research and development7,691 (509)— — — — — (89)— 7,093 
General and administrative5,496 (1,112)— — — — — (20)(172)4,192 
Depreciation and amortization3,449 — (3,266)(183)— — — — — — 
Goodwill Impairment23,989 — — — — — (23,989)— — — 
Total operating expenses45,768 (2,274)(3,266)(183)— — (23,989)(262)(172)15,622 
(Loss) income before provision for income taxes(37,897)2,274 3,266 194 (227)— 23,989 273 (26)(8,154)
Net (loss) income(37,936)2,274 3,266 194 (227)— 23,989 273 (26)(8,193)
(Loss) earnings per share: basic and diluted(3.79)0.23 0.33 0.02 (0.02)— 2.40 0.02 — (0.82)
Six Months Ended
June 30, 2023
Gross profit$15,397 $— $— $27 $— $— $— $183 $— $15,607 
Selling and marketing6,182 (353)— — — — — (93)— 5,736 
Research and development9,573 (464)— — — — — (471)— 8,638 
General and administrative6,515 (1,159)— — — — — (210)— 5,146 
Depreciation and amortization3,305 — (2,965)(340)— — — — — — 
Total operating expenses25,575 (1,976)(2,965)(340)— — — (774)— $19,520 
(Loss) income before provision for income taxes(12,540)1,976 2,965 367 (2,011)4,055 — 957 — (4,231)
Net (loss) income(12,551)1,976 2,965 367 (2,011)4,055 — 957 — (4,242)
(Loss) earnings per share: basic and diluted(1.68)0.26 0.40 0.05 (0.27)0.54 — 0.13 — (0.57)
Note: (Loss) earnings per share: basic and diluted - may be impacted by rounding to allow rows to calculate.

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Cover
Aug. 01, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 01, 2024
Entity Registrant Name Smith Micro Software, Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 001-35525
Entity Tax Identification Number 33-0029027
Entity Address, Address Line One 5800 Corporate Drive
Entity Address, City or Town Pittsburgh
Entity Address, State or Province PA
Entity Address, Postal Zip Code 15237
City Area Code 412
Local Phone Number 837-5300
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Soliciting Material false
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Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.001 per share
Trading Symbol SMSI
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000948708
Amendment Flag false
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