Good day, and welcome to the Smith Micro First Quarter 2025 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one, on your touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Charles Messman, Vice President, Marketing. Please go ahead. Thank you, Operator, and good afternoon, everyone. We appreciate you joining us today to discuss Smith Micro Software financial results for the first quarter ended March 31, 2025. By now, you should have received a copy of the press release with the financial results. If you do not have a copy and would like one, please visit the investor releases section of our website at www.smithmicro.com. On today's call, we have Bill Smith, our Chairman of the Board, President, and Chief Executive Officer, and Jim Kempton, our Chief Financial Officer. Please note that some of the information you will hear today during today's call discussion consists of forward-looking statements, including without limitation, those regarding the company's future revenue and profitability, our plans and expectations, new product development and availability, new and expanded market opportunities, future product deployments, growth by new and existing customers, operating expenses, and company cash reserves. Forward-looking statements involve risk and uncertainties, which could cause actual results or trends to differ materially from those expressed or implied by our forward-looking statements. For more information, please refer to the risk factors included in our most recent filed Form 10-K. Smith Micro assumes no obligation to update any forward-looking statements, which speaks to management's beliefs and assumptions only as of the date they are made. I want to point out in our forthcoming prepared remarks, we will refer to specific non-GAAP financial measures. Please refer to the press release disseminated earlier today for a reconciliation of these non-GAAP financial measures. With that said, I'll turn the call over to Bill. Bill. Thanks, Charlie. Good afternoon, and thank you for joining us today for our First Quarter 2025 Conference Call. We appreciate your interest. Throughout the first quarter and to date, we have been extremely busy on several fronts. Most notably, we have been executing on the new initiatives we discussed on our last call with a keen focus on SafePath OS for kids' phones and senior phones and on our SafePath Kids rate plan solution. We have engaged in extensive discussions with current and prospective mobile operator partners regarding these solutions, which align with the operators' core business strengths and objectives: selling devices and rate plans and adding subscribers. Our focus on SafePath OS for kids and senior phones and on our SafePath Kids rate plan solution has also broadened our reach into the carriers' organizations, which we believe will position us to be more strategically aligned with their long-term vision. I remain very confident about where we stand today, and I am pleased with the reception we are getting in the market. I am optimistic about closing new customer deals and expanding agreements with our current customer base in the coming weeks and months for our new and expanded offerings. It is an exciting time for us here at Smith Micro. As we have seen over the years, the process of selling, contracting, and launching new offerings with mobile operators can take longer than we would like, given the size and complexity of our customer organizations. We are making good, steady progress. I am as confident as ever that we will get them to the finish line, building on the strong global demand for digital family safety solutions that we believe present immense opportunities for Smith Micro and our shareholders. As excited as we are about delivering our latest solutions, we also continue to keep an eye on the future with a continual focus on innovation. Our SafePath platform product roadmap is aimed at ensuring that we and our operator customers will be able to offer cutting-edge solutions that families want. Our latest round of development efforts will culminate in the release of SafePath 8, the next generation of our SafePath platform. This upgrade will introduce an AI-centric set of features and capabilities that will enhance our platform to better serve our markets and elevate our core solution to a new level of performance. Later in the call, I will provide more detail on SafePath 8, as well as updates on some of our key customers and opportunities. Let's go ahead and turn the call over to Jim to discuss our financial results. Jim. Thanks, Bill, and good afternoon, everyone. I'll now be covering the financial results for the first quarter of 2025. During the first quarter, we recognized revenue of $4.6 million compared to $5.8 million for the same quarter of 2024, a decrease of approximately 20%. When compared to the fourth quarter of 2024, revenue decreased by approximately $300,000, or 7%. During the first quarter of 2025, family safety revenues were $3.8 million, which decreased by approximately $700,000, or 15%, compared to the first quarter of the prior year, driven in part by the continued decline in legacy Sprint Safe and Found revenue, as was expected. Family safety revenues were essentially flat compared to the fourth quarter of 2024. During the first quarter of 2025, CommSuite revenue was approximately $700,000, which increased by approximately $100,000 compared to the first quarter of 2024. Revenue from CommSuite decreased by approximately $400,000 compared to the fourth quarter of 2024 due to a favorable adjustment to revenue recognized during the fourth quarter of 2024. ViewSpot revenue was approximately $100,000 for the first quarter of 2025 and declined by approximately $600,000 compared to the first quarter of the prior year. The decline in ViewSpot revenues compared to the first quarter of 2024 was primarily due to the end of one of our ViewSpot contracts last year. ViewSpot revenues increased nominally compared to the fourth quarter of 2024. In the second quarter of 2025, we are expecting consolidated revenues to be in a range of approximately $4.4 million-$4.8 million. For the first quarter of 2025, gross profit was approximately $3.4 million compared to approximately $3.8 million during the same period of the prior year, a decrease of approximately $400,000 due to the period-over-period decline in revenues. Gross margin was at 73% for the quarter compared to the 66% realized in the first quarter of 2024. The gross profit of $3.4 million in the first quarter of 2025 decreased by approximately $400,000 compared to the gross profit produced in the fourth quarter of 2024, driven primarily by the sequential decrease in revenues. In the second quarter of 2025, we expect gross margin to be in the range of 72%-75%. GAAP operating expenses for the first quarter of 2025 were $8.6 million, a decrease of $26.7 million, or 76%, compared to the first quarter of 2024, primarily attributable to the goodwill impairment charge of $24 million recorded in the first quarter of 2024, coupled with the cost reduction activities that we executed last year, and a decline in amortization costs associated with our intangible assets. Non-GAAP operating expenses for the first quarter of 2025 were $6.1 million compared to $8.1 million in the first quarter of 2024, a decrease of approximately $2 million, or 24%. Sequentially, non-GAAP operating expenses increased by approximately $300,000, or 5%, from the fourth quarter of 2024. We expect second quarter 2025 non-GAAP operating expenses to decrease by 1%-4% compared to the first quarter of 2025. The GAAP net loss for the first quarter of 2025 was $5.2 million, or $0.28 loss per share, compared to a GAAP net loss of $31 million, or $3.28 loss per share in the first quarter of 2024. The non-GAAP net loss for the first quarter of 2025 was $2.9 million, or a $0.16 loss per share, compared to a non-GAAP net loss of approximately $4.2 million, or a $0.45 loss per share in the first quarter of 2024. Within today's press release, we have provided a reconciliation of our non-GAAP metrics to the most comparable GAAP metric. For the first quarter of 2025, the reconciliation includes adjustments for intangible asset amortization of $1.3 million, stock compensation expense of $1.1 million, and depreciation expense of approximately $100,000, partially offset by changes in the fair value of warrants of approximately $100,000. Due to our cumulative net losses over the past few years, our GAAP tax expense is primarily due to certain state and foreign income taxes. For non-GAAP purposes, we utilized a 0% tax rate for the first quarter of 2025 and 2024. The resulting non-GAAP tax expense reflects the actual income taxes expense during each period. From a balance sheet perspective, we reported $2.3 million of cash and cash equivalents as of March 31, 2025. I also wanted to note that as our existing shelf registration is expiring next week, earlier this afternoon, we filed a new shelf registration to replace it. The expiring shelf registration originally had $75 million of capacity and still has approximately $65 million of unused capacity. The new shelf registration will have substantially the same terms as the expiring shelf, including $75 million of capacity. This concludes my financial review. Now back to Bill. Thanks, Jim. Let's begin with SafePath 8 and some of the new exciting features that will be included in this upgrade to the platform, both at launch and in the future as we roll out our exciting next-generation roadmap. With SafePath 8, we will bring the power of AI to every member of the family, enhancing the platform to deliver personalized and proactive protection. Designed with privacy and peace of mind at its core, SafePath 8 will seamlessly connect and help families safeguard each generation at every stage of life. As we evaluate the ways in which AI can safely offer additional protections and benefits to the individuals and families who use our products, we consider its use according to our AI strategy, which is built on three key pillars. The AI solutions that we use must be safe, must be carrier-grade, and must be insightful. With these three pillars in mind, let me discuss further. At Smith Micro, artificial intelligence, AI, or machine learning, has long helped to enable our product innovation. We applied it to our CommSuite Visual Voicemail solution using AI models to deliver intelligent features like voice-to-text transcription and scam call detection. We also leverage AI-powered capabilities and features of our existing SafePath solution, such as SafePath Drive, which uses advanced machine learning models to detect speeding, sharp turns, hard braking, and crash events, enhancing real-time family safety on the road. With SafePath 8, we will introduce a new set of AI-powered features and functionalities to the platform that we believe will provide families with powerful, actionable insights they can use to keep each other safe. Along these lines, SafePath 8 will include social media intelligence. This feature set will provide parents with valuable insights regarding their children's social media usage and notify parents of areas of potential concern, including things like cyberbullying, hate speech, profanity—actually, immutable languages—and self-harm. When SafePath detects an area of concern with a child's social media activity, it will automatically notify the parent of what has transpired, empowering parents to have valuable conversations with their children. Keep in mind that these notifications will occur only in connection with the areas of concern and not every online activity. This is where we put AI to work to help parents. With SafePath 8, we also plan to introduce a dynamic age-aware platform that can adapt to the child's age. Once the parent enters the child's initial age group during setup, SafePath will enter a self-configuring mode and establish recommended age-based settings for the child. Content filters, time limits, usage of apps, and app categories all are guided by the child's age group based on the recommendations of industry-leading experts. These steps will make onboarding frictionless and personalized for the family. Of course, parents will have the ability to override these recommendations at any time and select settings they feel are most appropriate for their children. Another key enhancement that will be part of the SafePath 8 platform will be the ability to block kids from using AI chatbots and tools, empowering parents to establish the limits they feel are most appropriate for their children. One example where parents will benefit from this functionality is while their children are doing homework. Studies have shown that using AI for homework can hinder critical thinking, where kids rely on external tools instead of engaging in deep internal thinking or putting in the steps to solve a math problem. Another feature that we plan to include in SafePath 8 that we believe is truly unique will be our family AI assistant. This toolset will use large language models to provide parents with valuable insights from the SafePath platform. Most importantly, all of the AI elements we will include in SafePath 8 will be consistent with the three pillars that I shared as the foundation of our AI strategy. They will be carrier-grade, safe, and secure, with strong guardrails in place. They will provide parents with valuable insights to help them keep children safer as they navigate the online world. Additionally, SafePath 8 will include our digital wellness resource website, which users will be able to access directly from our SafePath app. The digital wellness resources site is a curated collection of online resources aimed at helping families and parents obtain helpful information. The site is easy to navigate and organized by topic, so parents and families can jump right to the topic they are most interested in and obtain additional expert information and insight. We expect the available resources to expand as we launch the initiative in partnership with carrier partners and content providers with relevant expertise. As excited as we are about our product innovations, we are equally excited about some of the activities we're seeing in the market. Now let's talk about our carrier activity. In general, during the past several quarters, I believe we have seen a positive shift in our conversations with our current and prospective customers with respect to our latest solutions and our customers' long-term strategies. I have been pleased with the expanded reach within our customers' organizations. We believe all of this has been driven by the expansion of our portfolio and is very positive. With Orange Spain, we remain very excited about the path forward for our SafePath Kids solution that is the technology supporting Orange Spain's unique 2U rate plan. We are working closely together with Orange on some new initiatives planned for back-to-school timeframe, and we will look forward to sharing future announcements around those coming initiatives. We also continue to engage productively with other Orange properties throughout Europe, building on the momentum of the 2U launch in Spain. We have also received interest from other mobile operators throughout Europe, resulting from the success of our appearance at Mobile World Congress earlier this year, and we'll soon launch new trials with a number of these mobile operators as a result. Back here in the U.S., we continue to work closely with AT&T on new marketing activities related to product updates that will be included in an upcoming release, which we believe will expand the available audience for AT&T's Secure Family, allowing for some different and broader marketing campaigns. Without getting ahead of ourselves on what we can share, we are also engaged in ongoing discussions with regard to the expansion of the SafePath platform. We continue to have a very solid and collaborative working relationship with AT&T and hope to have more news to share in the coming quarters. With Boost, we remain on track on several ongoing initiatives, including marketing initiatives for Visual Voicemail and Boost Family Guard. We are engaged in meaningful discussions with regard to different bundling opportunities, as well as our expanded SafePath solutions that we see as a great opportunity for Boost going forward. I believe there is a strong upside with this important partner. As I mentioned on our last call, our partnership with T-Mobile continues to broaden, and we continue to engage meaningfully with key stakeholders around our expanded SafePath offerings. I remain bullish about our future prospects for this key customer. More broadly, I want to note that we are seeing significant interest in SafePath OS for both kids and senior phones, as well as with our SafePath Kids rate plan solution with operators we currently are not doing business with. These innovative products have opened doors for our sales team, and the features and functionality associated with SafePath 8 has further piqued their interest. We believe the opportunities with these carriers will enhance our growth prospects. I expect to be able to provide additional color for you regarding these opportunities over the coming quarters. As you can see, we are excited about the activity we're seeing in the market, particularly around our product innovations, from SafePath OS for kids and senior phones to SafePath Kids rate plan solution and our upcoming launch of SafePath 8 and its future roadmap. We believe that this next generation of SafePath will enable parents to ensure that every child gets an experience automatically tailored to their needs, from youngsters taking their first digital steps to teenagers navigating the complexities of social media, and for seniors seeking to age in place and enjoy their senior years in a safe and secure manner. Given the opportunities ahead and the innovation that drives us forward, I am optimistic about the company's prospect for a return to growth and profitability. With that, let's turn the call over to the operator for questions. Operator. We will now begin the question-and-answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Scott Searle with Roth Capital. Please go ahead. Hey, good afternoon. Thanks for taking my questions. Excited to hear some of the new features coming along with SafePath 8. Bill, maybe to dive in, starting with 2U, I'm wondering if there are any metrics that you're willing to share in terms of how that's been going so far year to date. It's been up and running now for a couple of months. Also, wondering how you think about that in terms of ultimate success and penetration. What kind of penetration can we get into that youth installed base? Yes, Scott, I think the way to think about 2U is it's off to a strong start. They're getting some pretty good adoption. They think that they will get better adoption as we get into the summer and the back-to-school period. They actually said launching in right after the first of the year was probably one of the more difficult times to launch a product like this, and yet they still are seeing some very meaningful success and growth. The product itself is being received well. We are working through different issues that come up with a new product launch, and we're working in the spirit of teamwork, and it's been very, very positive. All in all, I would say we're very happy with what's coming, and we think it's going to get even more meaningful as we move forward. Bill, maybe to follow up then on SafePath Kids, it sounds like you're engaged with a number of different operators. I'm wondering if there are any sort of metrics that you're willing to share in terms of the number of engagements, the timing of pilots. I think previously you've talked about the third quarter potentially being an area or a timeline where we could see some inflection as a lot of these operators target back-to-school as an opportunity to sell something like SafePath Kids. Yeah, I think that still holds true. I wouldn't change anything about what you just said because it is what I said on our last call, and I would fully want to reiterate that on this call. We do expect that we have some good opportunities for some meaningful launches in the third quarter, and the third quarter could start to really show some inflection for all the efforts that we're putting into growing our products, staying current, and pushing the envelope as far as the capabilities. Look, I see this whole push for AI as being yet another meaningful driver for growth. It is being very well received by the operators. They view it as a very positive move on our part, and we want to lead this market, and this is what leaders do. They continually move the product forward, and that's what we're doing. Lastly, if I could, on SafePath seniors, I'm wondering when we'll start to see the first pilots on that front. Are you starting to get some visibility into that? And then just real quick, conceptually, from a pricing standpoint of SafePath 8, how should we be thinking about that? I'm assuming it's a premium, but just kind of wondering what the early thoughts are on that front. Thanks. Yeah, let me make sure I cover all the parts of that question. First off, as far as the senior phone, we've actually already had our first trial, and we're well into the conversation around that product with that particular carrier. There will be more to follow. We expect that the senior version of SafePath OS will be available this fall, and we're looking for launch, hopefully maybe in fourth quarter around the holiday selling season. That might be a good time to look for some movement forward on that front. As far as on the SafePath 8 offerings, yes, there are a lot of premium offerings that are part of this as well as other things we've had for some period of time. We are looking to launch this offering as a premium at a premium price, which will be also beneficial to our overall revenues. That is something you'll just have to stay tuned for. It's a work in process. Great. Thanks so much. I'll get back in the queue. Thanks. Your next question comes from Matthew Harrigan with Benchmark. Please go ahead. Thank you. I guess two questions. One was with SafePath 8 and AI, and you talked about use of AI for homework and all that. It feels like you're getting a lot more that's germane to devices beyond smartphones into tablets and all that, regulating the social media activity. How do you see that as an increasingly important extension? I guess in the nature of horse of vacuum category and probably unmet demand for something like family safety of horse of vacuum even more, how are guys who are not using you, who are kind of fumbling around trying to do something in-house or looking at other alternatives faring? I know you do not want to be too specific on Verizon, but what are you seeing in terms of capabilities that do not stem from Smith Micro? Thanks. Historically, we have always had meaningful business with Verizon, so I would welcome the opportunity to do business with them in the future. Clearly, when you see the kind of development that we are working on with SafePath OS for kids, SafePath OS for seniors, bringing out all these AI features, we are moving the envelope. These are big-time development efforts. This is not for a sideline business. This is something that is core to what we do. I think as carriers look at this, it makes it just that much more daunting an effort for them to say, "Gee, I guess we'll just go build our own version of this." That's a tough swallow. Everything that we're doing is not going to make it any easier. Everything we're doing is making it tougher. The important part, though, is while it's making it tough for those who maybe want to save a little bit and try to do it on their own or whatever the driver is, the important part is for their customers, for the families that they want to embrace, that they want to pull into the tent with them. The families want these features. Being a parent in the digital age, I'm a little older, and I didn't have to experience it, but I would think it's pretty scary. To be able to use the power of AI as an assistant, as a helpmate in the whole parenting process, I just think it's what it's all about. I go back to the premise that I've said a number of calls in the past. There is no more valuable sub that a carrier can attract than a family sub. Families are willing to—they're much more loyal. They don't churn. They're willing to spend a little extra money because they have some things in mind that they really want to help with. Keeping the family safe has got to be one of the bases of this. If I was a carrier and I knew that the best customers I could get are family subs, I'd be doing business with Smith Micro. I wouldn't be trying to save a few bucks. I wouldn't be trying to try some startup garage shop or something like that. I'd want to go with somebody who actually knows what they're doing. I want to make sure that the product is safe, is carrier-grade, and it is intuitive and is helpful to the parents. I know I'm preaching a little bit, but this is my shot. You asked the question. What about the increased relevance for tablets? I guess also any kind of—I can't imagine there are too many second-order effects if the worst case on iPhone costs and pricing are realized. I think you probably have your niche, and obviously, you've got the installed base, and it doesn't matter that much people getting new phones. Any thoughts on how the global disruption could affect you? That's my last question. Thanks, Bill. Yeah. Okay. I understand where you're going with that. Look, for our OS solution, we're using the largest device manufacturer on the Android side. It is products that every carrier already sells, so they do not have to go out and source new phones or new tablets. Yes, tablets are part of the game too. I think the phone probably is bigger, but nonetheless, we are looking at the tablet, and our solution will run on a tablet without doing anything else. That's great. Thanks, Bill. That answered your question? Absolutely. Thanks. Again, if you have a question, please press star, then one. Seeing no further questions, this concludes our question-and-answer session. I would like to turn the conference back over to Charles Messman for any closing remarks. Thank you, Operator, and thanks everybody for joining us. We appreciate your interest in the company. Should you have any questions, please feel free to give us a call. Thanks, and we'll talk to you in a little bit. Bye. This concludes today's conference call. Thank you for attending today's presentation. You may now disconnect.