SOUNDTHINKING, INC.

Note 1. Organization and Description of Business

SoundThinking, Inc. (the “Company”) brings the power of digital transformation to law enforcement and security personnel by providing precision-policing and security solutions, combining data-driven solutions and strategic advisory services for law enforcement, security teams and civic leadership. As of September 30, 2025, the Company had approximately 337 customers and to date has worked with approximately 2,100 agencies to help drive more efficient, effective, and equitable public safety outcomes.

The Company’s SafetySmart™ platform includes six data-driven tools consisting of (i) its flagship product, ShotSpotter®, the leading outdoor gunshot detection, location and alerting system trusted by 178 cities and 22 universities and corporations as of September 30, 2025, (ii) CrimeTracer™, a leading law enforcement search engine that enables investigators to search through more than one billion criminal justice records from across jurisdictions to generate tactical leads and quickly make intelligent connections to solve crimes, (iii) CaseBuilder™, a one-stop investigative management system for tracking, reporting, and collaborating on cases, (iv) ResourceRouter™ that directs the deployment of patrol and community anti-violence resources in an objective way to help maximize the impact of limited resources and improve community safety, (v) PlateRanger™ powered by Rekor®, an advanced license plate recognition (“ALPR”) and vehicle identification solution that leverages artificial intelligence (“AI”) and machine learning (“ML”) to enhance investigative efficiency and provide real-time data sharing for law enforcement, introduced in July 2024 through a strategic partnership with Rekor Systems, Inc and (vi) SafePointe™, an AI-based weapons detection system. The Company offers its solutions on a software-as-a-service subscription model to its customers.

ShotSpotter for Campus and ShotSpotter for Corporate, are typically smaller-scale deployments of ShotSpotter vertically marketed to universities, corporate campuses, and key infrastructure centers to mitigate risk and enhance security by notifying authorities of outdoor gunfire incidents, saving critical minutes for first responders to arrive. In 2019, the Company created a technology innovation unit, SoundThinking Labs, to expand its efforts supporting innovative uses of its technology to help protect wildlife and the environment. Additionally, the Company provides maintenance and support services and professional software development services totwo customers, through sales channel intermediaries.

The Company’s principal executive offices are located in Fremont, California. The Company hassix wholly owned subsidiaries.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements include the results of the Company and its wholly owned subsidiaries. All significant intercompany transactions have been eliminated upon consolidation.

The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the consolidated financial statements filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (“Annual Report”) filed with the SEC on March 31, 2025.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, comprehensive loss, stockholders’ equity and cash flows for the interim periods, but are not necessarily indicative of the results of operations or cash flows to be anticipated for the full year 2025 or any future period. The Company has evaluated subsequent events occurring after the date of the condensed consolidated financial statements for events requiring recording or disclosure in the unaudited condensed consolidated financial statements.

Use of Estimates

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its significant estimates, including the valuation of accounts receivable, the lives and realization of tangible and intangible assets, contingent consideration liabilities, stock-based compensation expense, customer life, accounting for revenue recognition, contingent liabilities related to legal matters, and income taxes including deferred taxes and any related valuation allowance. In particular, the Company’s contingent consideration liabilities are subject to significant estimates surrounding forecasts of certain revenues and other factors. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions it believes to be reasonable under the circumstances. Actual results could differ from those estimates and such differences could be material to the Company’s financial position and results of operations.

The Company records net deferred tax assets to the extent the Company believes these assets will more likely than not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. In the event the Company determines that it would be able to realize its deferred assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

Concentrations of Risk

Credit Risk – Financial instruments that potentially subject the Company to concentration of credit risk consisted primarily of cash and cash equivalents and accounts receivable from trade customers. The Company maintains its deposits of cash and cash equivalents atthree domestic andfour international financial institutions. The Company is exposed to credit risk in the event of default by a financial institution to the extent that cash and cash equivalents are in excess of the amount insured by the Federal Deposit Insurance Corporation (“FDIC”) and other local country government agencies. The Company generally places its cash and cash equivalents with high-credit quality financial institutions. To date, the Company has not experienced any losses on its cash and cash equivalents. As of September 30, 2025, the Company had approximately $10.5 million, for which only $250,000 is insured under FDIC limits, less than $0.1 million and $0.1 million, deposited with the Company’s three domestic financial institutions.

Concentration of Accounts Receivable and Contract Assets – At September 30, 2025, one customer accounted for 25% of the Company’s total accounts receivable and contract assets, net. At December 31, 2024, one customer accounted for 19%, of the Company’s total accounts receivable and contract assets, net.

Concentration of Revenues – For the three months ended September 30, 2025, one customer accounted for 28% of the Company’s total revenues. For thethree months ended September 30, 2024, two customers accounted for 23% and 11% of the Company’s total revenues. For thenine months ended September 30, 2025, one customer accounted for 30% of the Company’s total revenues. For thenine months ended September 30, 2024, two customers accounted for 25% and 11% of the Company’s total revenues.

Concentration of Suppliers – The Company relies on a limited number of suppliers and contract manufacturers. In particular, a single supplier is currently the sole manufacturer of the Company’s proprietary sensors.

During the nine months ended September 30, 2025, there were no changes to the Company’s significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Recent Accounting Pronouncements

Improvements to Income Tax Disclosures

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 enhances the transparency of income tax disclosures, primarily by requiring public business entities to disclose on an annual basis, specific categories in the rate reconciliation tabular presentation, as well as by providing additional information for reconciling items that meet a quantitative threshold. The ASU also requires disaggregated disclosures of federal, state and foreign income taxes paid. The new guidance is effective for fiscal years beginning after December 15, 2024. The Company does not expect implementation of the new guidance to have a material impact on its unaudited condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Effective

Expense Disaggregation Disclosures

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires disclosure of specific information about costs and expenses within relevant expense captions on the face of the income statement, qualitative descriptions for expense captions not specifically disaggregated quantitatively, and the total amount and definition of selling expenses for interim and annual reporting periods. This standard is effective for the Company’s annual reporting period beginning January 1, 2027 and interim reporting periods beginning January 1, 2028 and should be applied on a retrospective or prospective basis, with early adoption permitted. The Company is currently assessing the impact of adopting this standard on our consolidated financial statements.

Measurement of Credit Losses for Accounts Receivable and Contract Assets

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which introduces a practical expedient for all entities, related to applying Subtopic 326-20 to current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. In developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. This standard is effective for the Company’s annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company is currently assessing the impact of adopting this standard on our consolidated financial statements.

Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to prescriptive and sequential software development stages. An entity is required to start capitalizing software costs when both of the following occur: 1. Management has authorized and committed to funding the software project and 2. It is probable that the project will be completed and the software will be used to perform the function intended. This standard is effective for the Company’s annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently assessing the impact of adopting this standard on our consolidated financial statements.

Note 3. Revenue Related Disclosures

The changes in deferred revenue were as follows (in thousands):

The following table presents remaining performance obligations for contractually committed revenues as of September 30, 2025 (in thousands):

The timing of certain revenue recognition included in the table above is based on estimates of go-live dates for contracts not yet live. Contractually committed revenue includes deferred revenue as of September 30, 2025 and amounts under contract that will be invoiced after September 30, 2025.

During the three months ended September 30, 2025, the Company recognized revenues of $24.3 million from customers in the United States, and $0.8 million from customers in the Bahamas, South Africa and South America. During thethree months ended September 30, 2024, the Company recognized revenues of $26.0 million from customers in the United States, and $0.3 million from customers in the Bahamas, South Africaand Uruguay.

During the nine months ended September 30, 2025, the Company recognized revenues of $77.0 million from customers in the United States, and $2.3 million from customers in the Bahamas, South Africa and South America. During thenine months ended September 30, 2024, the Company recognized revenues of $77.7 million from customers in the United States, and $0.9 million from customers in the Bahamas, South Africa and Uruguay.

During the three months ended September 30, 2025, the Company recognized revenues of $24.9 million from monthly subscription, maintenance and support services, and $0.2 million from professional software development services. During thethree months ended September 30, 2024, the Company recognized revenues of $25.6 million from monthly subscription, maintenance and support services, and $0.7 million from professional software development services.

During the nine months ended September 30, 2025, the Company recognized revenues of $78.5 million from monthly subscription, maintenance and support services, and $0.8 million from professional software development services. During thenine months ended September 30, 2024, the Company recognized revenues of $76.2 million from monthly subscription, maintenance and support services, and $2.4 million from professional software development services.

During the nine months ended September 30, 2025, the Company recognized approximately $3.5 million of catch-up revenue comprising approximately $3.5 million of catch-up revenue during the three months ended March 31, 2025 based ontwo 3-year contract renewals with New York City Police Department. During thethree months ended September 30, 2025, the Company recognized $0.8 million of catch-up revenue from various customers.

Note 4. Fair Value Measurements

In August 2023, the Company estimated the fair value of the contingent consideration liability associated with its acquisition of SafePointe, LLC (“SafePointe”) to be $3.0 million as of the acquisition date, using a Monte Carlo simulation approach with asset and revenue volatility of 76.1% and 25.8%, respectively. This fair value measurement is classified as Level III within the fair value hierarchy as prescribed by ASC 820, Fair Value Measurement.

As of December 31, 2023, the Company evaluated the contingent consideration related to the acquisition of SafePointe based on estimated SafePointe revenue and adjusted the consideration to $0.6 million. During nine months ended September 30, 2024, the Company determined the contingent consideration was not probable of being earned resulting in the fair value of contingent consideration liabilities as of September 30, 2025 and 2024 beingnil. Accordingly, the Company recognized a change in fair value of contingent consideration of $0.6 million during thenine months ended September 30, 2024. There wereno changes in the fair value of contingent consideration during thenine months ended September 30, 2025.

There wereno transfers into or out of Level III during thenine months ended September 30, 2025 and 2024.

The Company also has $9.0 million in a money market fund. The fair value measurement was classified as Level I within the fair value hierarchy as prescribed by Accounting Standards Codification 820-10-35-37 (“ASC 820, Fair Value Measurement”).

The Company records its financial assets and liabilities at fair value. The carrying amounts of certain of the Company’s financial instruments, including cash, trade and other receivables, net, and accounts payable, approximate their fair value due to their short maturities.

Note 5. Intangible Assets, Net

Intangible assets consist of the following (in thousands):

Intangible amortization expense was approximately $1.0 million for both of thethree months ended September 30, 2025 and 2024. Intangible amortization expense was approximately $2.9 million for both of thenine months ended September 30, 2025 and 2024.

The following table presents future intangible asset amortization as of September 30, 2025 (in thousands):

Note 6. Details of Certain Condensed Consolidated Balance Sheet Accounts

Accounts receivable and contract assets, net (in thousands):

Prepaid expenses and other current assets (in thousands):

Other assets (long-term) (in thousands):

Accrued expenses and other current liabilities (in thousands):

Note 7. Related Party Transactions

During the three and nine months ended September 30, 2025, the Company recognized approximately$10,000 and $28,000, respectively, in revenues from SoundThinking Labs projects with charitable organizations that have received donations from one of the Company’s former directors and from one of the Company’s significant stockholders. During the three and nine months ended September 30, 2024, the Company recognized approximately $41,000 and $0.1 million, respectively, in revenues from such SoundThinking Labs projects.

Note 8. Restructuring

In the second quarter of 2024, the Company restructured its workforce and eliminated 3% of its total headcount to more effectively allocate its resources and to reduce operational costs. Additionally, the Company terminated a building lease early for a location that was no longer in use.

Restructuring expense related to the workforce reduction during the nine months ended September 30, 2024 amounted to $0.3 million, consisting of cash expenditures forseverance and other employee separation-related costs. Restructuring expenses related to the lease termination were $0.1 million, comprising of early termination fees and monthly rent. These restructuring expenses were recorded in other expense, net, in the unaudited condensed consolidated statement of operations.

There wasno restructuring activity during thenine months ended September 30, 2025.

Note 9. Stock Repurchase Program

During the nine months ended September 30, 2025, the Company repurchased 225,334 shares of its common stock at an average price of $13.15 per share for a total of $3.0 million under its stock repurchase program. During the nine months ended September 30, 2024, the Company repurchased 418,940 shares of its common stock at an average price of $14.31 per share for a total of $6.0 million under its stock repurchase program.

Note 10. Net Income (Loss) per Share

The computation of basic net income (loss) per share is based on the weighted-average number of shares of common stock outstanding during each period. The computation of diluted net income (loss) per share is based on the weighted-average number of shares outstanding during the period plus, when their effect is dilutive, incremental shares consisting of shares subject to stock options, restricted stock units, employee stock purchase plan purchase rights and warrants.

The following table summarizes the computation of basic and diluted net income (loss) per share (in thousands, except share and per share data):

The following potentially dilutive shares outstanding at the end of the periods presented were excluded in the calculation of diluted net loss per share as the effect would have been anti-dilutive:

Note 11. Equity Incentive Plans

Stock options

A summary of option activities under the 2005 Stock Plan, as amended in January 2010 and November 2012 (the “2005 Plan”) and 2017 Equity Incentive Plan (the “2017 Plan”) during thenine months ended September 30, 2025 is as follows:

Under an “evergreen” provision, the number of shares of common stock reserved for issuance under the 2017 Plan will automatically increase on January 1 of each year, beginning on January 1, 2018 and ending on and including January

1,2027, by 5% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year or a lesser number of shares determined by the Board. In accordance with the evergreen provision, the number of shares of common stock reserved for issuance under the 2017 Plan was increased on January 1, 2025 by 631,724 shares, which was equal to 5% of the total number of shares of common stock outstanding on December 31, 2024.

Restricted stock units

A summary of restricted stock unit (“RSU”) activities under the 2017 Plan during thenine months ended September 30, 2025 is as follows:

Performance-based restricted stock units:

During the year ended December 31, 2024, the Company granted to members of the Company’s management team RSU awards with performance-based vesting conditions (“PSUs”), totaling 544,228 shares at a grant date fair value of $17.74 per share, the closing stock price on the grant date. These PSUs vest in one installment on the certification date, which shall occur as soon as administratively practicable following the end of 2026, based onthe satisfaction of revenue and Adjusted EBITDA performance goals for fiscal year 2026, asdetermined by the Compensation and Human Capital Committee of the Board of Directors of the Company. Compensation expense related to the PSUs is estimated each period based on the fair value of the target stock unit at the grant date and the most probable level of achievement of the performance conditions. Compensation expense related to these awards was approximatelynil and $0.3 million for thethree months ended September 30, 2025 and 2024, respectively. Compensation expense related to these awards was approximately $0.5 and $0.7 million for thenine months ended September 30, 2025 and 2024, respectively.

During the nine months ended September 30, 2025, the Company granted to members of the Company’s management team PSUs of 813,348 shares with a grant date fair value of $16.43 per share, the closing stock price on the grant date. These PSUs vest in one installment on the certification date, which shall occur as soon as administratively practicable following the end of 2027, based onthe satisfaction of revenue and Adjusted EBITDA performance goals for fiscal year 2027, as determined by the Compensation and Human Capital Committee of the Board of Directors of the Company. Compensation expense related to the PSUs is estimated each period based on the fair value of the target stock unit at the grant date and the most probable level of achievement of the performance conditions. As of September 30, 2025, no expense was recorded related to these PSUs as the achievement of the minimum target for 2027 was not probable of being met.

In February 2025, the Company introduced a PSU-based performance bonus plan (“PSU Bonus Plan”) for exempt employees. Under the PSU Bonus plan, employees may receive up to 133,261 shares with a grant date fair value of $15.12, the closing stock price on the grant date, which vest in one installment on the certification date and occur as soon as administratively practicable following the end of 2025, based on the satisfaction of the Company obtaining certain performance criteria. As of September 30, 2025, the Company determined a portion of the shares granted under the PSU Bonus Plan are probable of vesting and recorded $0.6 million and $1.4 million expense related to the PSU, for thethree and nine months ended September 30, 2025, respectively.

During the nine months ended September 30, 2025, the Company granted to members of the Company’s leadership team PSUs of 448,222 shares with a grant date fair value of $15.51 per share, the closing stock price on the grant date. These PSUs vest in one installment on the certification date, which shall occur as soon as administratively practicable following the end of 2026, based onthe satisfaction of revenue and Adjusted EBITDA performance goals for fiscal year 2026, as determined by the Compensation and Human Capital Committee of the Board of Directors of the Company. Compensation expense related to the PSUs is estimated each period based on the fair value of the target stock unit at the grant date and the most probable level of achievement of the performance conditions. As of September 30, 2025, the Company determined a portion of the shares granted under the PSU Bonus Plan are probable of vesting and recorded less than $0.1 million and $0.3 million for thethree and nine months ended September 30, 2025, respectively.

2017 Employee Stock Purchase Plan

Under the 2017 ESPP, eligible employees may purchase shares of our common stock through payroll deductions that cannot exceed 15% of the employee’s salary. The 2017 ESPP provides for asix-month offering period. At the end of the purchase period, eligible employees are permitted to purchase shares of common stock at the lower of 85% of the fair market value at the beginning or end of the offering period subject to tax limitations on the total value of the purchase.

The 2017 ESPP contains an “evergreen” provision that provides for an automatic annual share increase on January 1 of each year, in an amount equal to the lesser of (1)2% of the total number of shares of common stock outstanding on December 31st of the preceding calendar year, (2)150,000 shares or (3) such number of shares as determined by the Board. In accordance with the evergreen provision, the number of shares of common stock reserved for issuance under the 2017 ESPP was increased on January 1, 2025 by 150,000 shares. The number of shares available for grant under the 2017 ESPP was 675,768 as of September 30, 2025.

Total stock-based compensation expense associated with the 2005 Plan, 2017 Plan and 2017 ESPP is recorded in the condensed consolidated statements of operations and was allocated as follows (in thousands):

Note 12. Financing Arrangements

The Company has a revolving loan facility (the “Revolving Facility”) under its Credit Agreement with Umpqua Bank, as amended (the “Umpqua Credit Agreement”) with a revolving credit commitment of $40.0 million and letter of credit sub-facility of $7.5 million that matures on October 15, 2027.

Any amounts outstanding under the letter of credit sub-facility reduce the amount available for the Company to borrow under the Revolving Facility. The available loan facility as of September 30, 2025 and December 31, 2024 was approximately $36.0 million and $21.0 million, respectively. As of September 30, 2025 and December 31, 2024, there was $4.0 million outstanding on the Company’s line of credit, which the Company borrowed in August 2023 to partially fund the acquisition of SafePointe. The interest expense recorded for thethree and nine months ended September 30, 2025 was $0.1 million and $0.2 million based on a weighted-average interest rates of 6.31% and 6.30%, respectively. Forthree and nine months ended September 30, 2024, the interest expense recorded was $0.1 million and $0.3 million, respectively. As of September 30, 2025 and December 31, 2024, the Company was in compliance with all covenants and other requirements set forth in the Umpqua Credit Agreement.

Note 13. Commitments and Contingencies

The Company may become subject to legal proceedings, as well as demands and claims that arise in the normal course of business. Such claims, even if not meritorious, could result in the expenditure of significant financial and management resources. The Company makes a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed and adjusted to include the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to a particular matter.

An unfavorable outcome on any litigation matters could require payment of substantial damages, or, in connection with any intellectual property infringement claims, could require the Company to pay ongoing royalty payments or could prevent the Company from selling certain of its products. As a result, a settlement of, or an unfavorable outcome on, any of the matters referenced above or other litigation matters could have a material adverse effect on the Company’s business, operating results, financial condition and cash flows.

Note 14. Segment Reporting

The Company operates as asingle operating segment. The Company’s chief operating decision maker is one individual and has the role of President and Chief Executive Officer (the “CODM”). The CODM reviews financial information including operating results and assets on a consolidated basis and is regularly provided with only the consolidated expenses as noted on the face of the statement of operations.