Q3 2022 Shotspotter Inc Earnings Call
[music].
Good afternoon, and welcome to Shotspotter as third quarter 2022 earnings Conference call. My name is Sarah and I will be your operator for today's call joining us are shotspotter CEO , Ralph Clark and CFO Alan Stewart. Please note that certain information discussed.
Just on the call today will include forward looking statements about future events and Shotspotter its business strategy and future financial and operating performance. These forward looking statements are only predictions and are subject to risks uncertainties and assumptions that are difficult to predict and may cause actual results to differ materially from there.
Those stated or implied by those statements.
Of these risks and assumptions are discussed in Shotspotter SEC filings, including its registration statement on form S. One.
These forward looking statements reflect management's beliefs estimates and predictions as of the date of this live broadcast November eight 2022, and Shotspotter undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date of this call 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 Dot Shotspotter dotcom.
Now I would like to turn the call over to Shotspotter CEO Ralph Clark Sir. Please proceed.
Thank you and good afternoon to those joining us today I'm very pleased to be able to report on the progress Shotspotter is making toward our strategic objectives and helping drive the digital transformation of local law enforcement agencies globally.
<unk> has assembled a compelling set of precision policing solutions that help address the critical challenges facing today's law enforcement profession.
We are committed to help agencies become efficient effective and equitable and delivering positive public safety outcomes to the communities. They are sworn to serve and protect.
Financially, we reported revenues of $18 8 million up 29% from $14 5 million in Q3 of 2021.
Our quarterly adjusted EBITDA grew 37% to $3 1 million from $2 $2 million last year.
Overall Shotspotter response had a very strong go live cadence this quarter.
Went live with seven new customers, including Aurora, Illinois, Mobile, Alabama, Rancho Cordova, California, Homestead, Florida, Lawrenceville Heights, Ohio, along with Richmond County in West Columbia, South Carolina.
We also went live with six expansions of existing customers.
Holding a nine square mile expansion and U S Virgin Islands as.
As a part of our security solutions. We were also very pleased to have added the Illinois state police as a customer with eight linear miles covering that Dan Ryan Expressway.
Our ability to detect and alert on freeway shootings represents a significant technology innovation and Tam extender.
The state and highway patrol agencies deal with increase the Scourge of freeway road Rage and gang shootings we.
We believe we can deliver approximately 120 domestic respond go live miles this year not including any additional security based freeway models.
This would represent the second year in a row, we've achieved over 100 domestic go live miles in the year.
There are several respond projects that are currently staffing and process to be deployed over the next six months. These include the recently booked 30 plus square mile expansion in Detroit, which we formally contracted and book just two weeks ago. The 10 square mile expansion approved by the City Council in Cleveland and two already contracted and book.
International go live deployments that are going live this month in Cape Town, South Africa, and the Bahamas. These blindsight projects will help us finish the year strong and more importantly position us favorably with 2023 revenue producing respond mileage from early Q1 2023 go live activity.
Even as we continue to build a strong pipeline accelerate new bookings and go lives I'm, even more thrilled with our consistent world class retention experience with another quarter of minimal respond customer mileage nutrition net.
Net of price increases and discounts we estimate the core respond business to show less than 1% GAAP revenue attrition in 2022, which will be our third year in a row at these hyper low attrition rates.
We continue to book multiyear deals for new miles and expansions demonstrating the efficacy and value of our solution.
Our NPS processes score remained robust at 56, an example quote amongst several positive quotes from our NCS survey include the following from a chief of police from a medium sized northeastern agency quote the power of this tool and response accuracy and speed is invaluable when combined with other technologies it becomes a law.
<unk> force multiplier input.
As a company we understand that a considerable amount of the sales momentum. We're experiencing is due to the strong word of mouth referrals from our buying center of chiefs of police and their command staff, along with Mers and other elected officials theyre public and private sharing of their satisfaction with our solutions are helping drive viral interest in adoption.
Amongst their peers.
<unk> Superintendent Brown of Chicago Police Department attributed the following impressive results over the past five years, including 125 gunshot wound victims' lives that have been saved close to 3000 firearms recovered and over 24000 pieces of evidence collected due to shotspotter when there was no and I.
Repeat no corresponding call to 91 one.
The general public sentiment beyond our law enforcement buying centers to continue to address with prime and supports smart policing continues to grow in strength.
Recent Pew research poll revealed that 8% to 10 Black U S. Voters say that violent crime is very important to their 2022 midterm vote versus 34% of self identified Liberal Democrats and more specifically the national policing project conducted a citizen sentiment survey of residents in Chicago.
Use of acoustic gunshot detection and found that 72% of Chicago residents showed support for the use of gunshot detection technology.
On the ground perspective of residents living in communities concerned about public safety provide a very different outlook than what mischaracterize defund shotspotter campaigns would suggest.
It is no surprise that elected officials and appropriators are responding to the real world issue of crime in both policy and budget not only by refunding. The police, but also providing them the tools required to help them save lives and keep communities safe.
In my 12 years with the company our customers funding environment has never been stronger New Jersey, Ohio, and now New York State specifically allocated funds were pleased to acquire acoustic gunshot detection along with other law enforcement technology solutions. This is in addition to the resources continuing to be made by the federal and local.
<unk> budget coffers.
News broadcast or ABC examine the budgets up more than 100 cities and counties and found that 83% are spending at least 2% more on police in 2022 than in 2019.
Spite the fears from the pandemic and post George Floyd protest that their budgets, we're going to be significantly reduced.
There's a lot to be positive about in our pursuit of driving positive impact and local police agencies. However, what is particularly exciting for our company is adding different although adjacent state and federal law enforcement agency prospects with our comp link X solutions. We're also seeing early traction in the department of corrections market with our.
<unk> investigate solution you have heard me mentioned on earlier earnings calls about a large seven figure investigate deal with a department of corrections prospect on which we have been diligently working while that deal has taken longer process due to the scale and operational use case and user complexity I am thrilled that the proposed.
<unk> has been upsized to a much larger eight figure deal over five years. We believe this will be a bellwether account that will accelerate the adoption and consideration of other corrections prospects that we have in our growing corrections pipeline.
Given our increased visibility we are now narrowing our full year 2022 revenue guidance to 81% to $82 million.
Which will represent 40% revenue growth from 2021 to 2022 at the mid point. We believe we will go into 2023 with $80 million of <unk> versus the $63 million of <unk> that we started with in 2022.
Starting AAR position and momentum helps inform our formally establishing 2023 revenue guidance of $94 million to $96 million with 24% to 26% adjusted EBITDA margin. This represents 17% organic year over year growth at the midpoint from 2022 to 2000.
23, now Alan over to you.
Thank you Rob.
We're pleased with our performance in the third quarter.
As Ralph previewed during this quarter, we went live with 10, new customers, which included seven respond cities one investigate agency into security customers, but which one was the school and when it was a highway project and also expanded respond and six current cities.
Our only attrition in the third quarter was a small security customer.
We continue to see an increase in the interest of all of our solutions.
In addition to the above we already have 40, new respond miles under contract and are awaiting final contract executions on over 20 additional new respond miles.
<unk> eight figure multiyear investigate customer and.
And two new security contracts.
Of which the first is an expansion at a current university customer and the second is a multiyear deal that we obtained through new reseller partnership focused on oncologists and universities.
Second quarter in a row. This is the highest level of new miles in bookings that we've had since going public.
Let me provide more details on the quarter and then I will share some thoughts around the balance of the year.
Third quarter revenues were $18 8 million or 29% increase.
The $14 5 million in the third quarter of 2021.
Positive revenue work customer expansions and deployed miles are up year over year.
Almost $700000 of expected revenue for the quarter will shift to Q4, because some of the renewals that we were hoping to receive are still waiting final customer execution.
As many of you may know this happens frequently in the third quarter and Theres not concerned.
Additionally, the professional services and our lease division continues to be very lumpy quarter to quarter and was over $1 million lower in Q3 than Q2.
This will continue to vary quarter to quarter based on the customer needs.
Gross profit for the third quarter of 2022 was $10 3 million.
Or 55% of revenue.
$8 million or 55% of revenue for the prior year period.
Gross margin going forward will be impacted your small extent as we have completed the replacement of all <unk> centers that said, our new international respond contracts contribute a higher gross margin. So we expect that that will offset some of the impact.
We also saw growth in adjusted EBITDA for the third quarter, which was $3 $1 million a.
A 37% increase from the $2 2 million in the third quarter of 2021.
As a reminder, adjusted EBITDA.
non-GAAP financial measure.
Calculated by taking our GAAP net income or loss and adjusting out interest income expense income taxes, depreciation amortization and impairment stock based compensation expense and acquisition related expenses, including any adjustment to our contingent consideration obligation.
Yeah.
Turning to our expenses, our operating expenses for the third quarter were $6 2 million or 33% of revenues versus $8 9 million or 61% of revenues in the third quarter of 2021.
Operating expenses included higher personnel related costs as well as costs associated with forensic logic, which was acquired in January 2022.
That said operating expenses for the third quarter were offset by contingent consideration adjustment.
Reduction of approximately $5 4 million.
Related to the potential earn out payments associated with forensic logic acquisition.
Which have been reduced for 2022 and 2023 due to a delay in some expected contracts from forensic logic.
Breaking down our expenses sales and marketing expense for the third quarter was $5 4 million or 28, 5% of total revenue versus $4 million or 27, 6% of total revenue for the prior year period.
Our sales and marketing teams continue to build our sales pipelines and expand their marketing efforts. We also continue to focus on maintaining high levels of customer satisfaction, which helps keep our attrition rate low.
Our R&D expenses for the third quarter were $2 4 million or.
Or 12, 8% of total revenue versus $1 7 million or 11, 7% of total revenue for the prior year period.
We continue to invest in increasing the functionality of all of our products.
G&A expenses for the quarter were a negative $1 5 million compared to $3 2 million or 22, 1% of total revenue for the prior year period.
The 2022 reduction in G&A expenses was primarily related to the offset from the contingent consideration adjustment related to the forensic logic earn out expectations.
Without that adjustment G&A expenses would have been $3 9 million or 26% of total revenue.
We expect our G&A expenses will continue to increase in both percentage of revenue and in absolute dollars as our company grows.
For the fourth quarter, we expect it will increase as a percentage of revenues from what we experienced in the second and third quarters.
Our GAAP net income was $4 million or <unk> 33.
Basic and diluted share for the quarter based on $12 2 million and $12 4 million basic and diluted weighted average shares outstanding respectively.
This compares to a loss of $940000 or a loss of <unk> <unk> per share based on 11 7 million basic and diluted weighted average shares outstanding for the prior year period.
Our adjusted net income for the third quarter was a loss of $1 4 million.
For a loss of <unk> 11 per share based on $12 2 million and $12 4 million basic and diluted weighted average shares outstanding respectively.
This compares to a loss of $940000 or a loss of eight cents per share based on $11 7 million basic and diluted weighted average shares outstanding for the prior year period.
Adjusted net income a non-GAAP financial measure is calculated by taking our GAAP net income and adding back acquisition related expenses.
Including any adjustments to our contingent consideration obligation.
Deferred revenue at the end of the quarter increased to $37 million from $26 7 million at the end of fourth quarter 2021.
And the increase was primarily related to our growth in revenues and the addition of forensic logic deferred revenue.
We ended the quarter with $9 $6 million in cash and cash equivalents versus $15 $5 million at the end of fourth quarter 2021.
We also had approximately $22 million in accounts receivable at the end of the third quarter.
We're in the process of increasing our line of credit to $25 million to keep strong flexibility. In addition to our prudent cash balance we still have no short or long term debt outstanding.
Our board has also approved a new stock repurchase program as authorized the company to use up to $25 million.
To repurchase our stock when appropriate.
Turning to our full year 2022 outlook, we are narrowing our full year revenue guidance range to <unk> $81 million to $82 million and we are maintaining our expected adjusted EBITDA margin at 19% to 21%.
For 2023, we are currently expecting our <unk> to exceed $80 million at the start of the year, which is significantly higher than the $63 million that we started with in 2022.
This $80 million of IRR.
<unk> over $17 million related to our product solutions other than our respond gunshot detection.
For 2023, we expect revenues of 94 million to $96 million representing.
Representing an increase of 17% at the midpoint compared to the midpoint of the 2022 guidance range.
Additionally, we expect our adjusted EBITDA to expand to be approximately 24% to 26% of the forecasted revenue range in 2023 <unk>.
Now back to Ralph for some final thoughts and then we'll be happy to take your questions.
Great Hey, Thank you very much Alan I am very pleased with our Q3 results and I'm extremely proud of my work colleagues here at Shotspotter, who continue to execute across the business as a company. We're all extremely grateful for the partnerships, we formed with our customers and the difference we know, we're making and saving lives and helping.
Improved public safety outcomes.
At this point now would be ready to take your questions.
Thank you.
We will now begin the question and answer session.
Ask a question you May press Star then one on your telephone keypad.
You're using a speaker phone 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.
Yeah.
Our first question comes from Richard Baldry with Roth Capital. Please go ahead.
Thanks, and congrats on a lot of good metrics.
Can you talk about historically have you seen any change in buying patterns in sort of post election environment.
Is there any sort of stalling out while Congress has turned over.
I'm curious if how much of the funding backdrop, which seems pretty benevolent right now is locked into existing legislation.
Or could be changed though it does seem like both sides are trying to push the support for police message. So maybe there's really not a lot of risk there. Thanks.
Yes. So this is Ralph I'll, maybe start now and jump in and add on or correct as appropriate, but as we said on several calls the funding environment has probably been the most constructive that it's ever been for Luis My time at the company, which has been over 12 years.
Being fairly robust.
Funding opportunities at the federal state and even local levels to support police and addressing violent crime and I think as you hit it it's very much a bipartisan issue. So it is not about Republicans or Democrats I think all of them are getting on message from a policy and a budget authorization point of view to be able.
To support police that are extremely challenged I think in our last earnings call. We mentioned the fact, that's been reported on that we're seeing a lot of churn inside of law enforcement agencies in terms of personnel resources a lot of people retiring early.
A lot of chiefs that are getting turned out we're not seeing a lot of folks coming into the profession, because it's a less popular profession, and thats, putting a tremendous amount of pressure on policing departments to be able to kind of keep pace with increasing crime wave that's happening across the country, both small medium as well as large cities and we believe that.
Technology is probably one of the only things that can bridge the gap. So unfortunately, I think we're in a very constructive environment over the next three to five years certainly from a funding point of view to help support police dealing with protecting and serving communities.
And I think one of your security wins with noted is to come with a new partner.
Broadly discuss our though.
Who that partner is what type of reach they have what potential that could have to follow on from an early win.
Do you want to take that one.
Yes, sure I don't think we necessarily say the name right now but it.
We literally just started with them, but it's starting quite well.
They were able to get a three year contract with a brand New college.
It's not only helpful. But we're starting to find someone who has other relationships it doesn't necessarily cost us much either it's a great partnership and based on what they were able to do with the very first deal.
We're feeling pretty positive about what could come in the future there.
Okay, and maybe last for me.
The buyback authorization being new can you talk about sort of the thought process behind that behind the cadence on it.
<unk> cash flow versus balance sheet resources.
How to think about that over what period of time.
Sure. This is Alan I'll start and then Rob can add as well for those of you who followed us for a while you may realize we put in a a $15 million stock repurchase program in 2019.
We literally just finished that in Q2 of this year. So it does take a bit of time to do that.
So with the larger program $25 million.
As possible, but it does take US a couple of years to do that as well. We are limited based on how many shares we can repurchase per quarter. I think we will do it based on our availability of cash which continues to be quite nice.
And as well as seeing how the market responds to our stock I mean, if we think that the market is not understanding or properly evaluating where we're going.
It's likely that we would consider doing a repurchase or buyback.
Okay and last one for me heading into 2023 can you talk a bit about how you feel you're staffed up properly for.
Go to market, what you think head count expansion and things throughout 'twenty three to get to 24.
So maybe I'll start out and you can fill in the details. So I mean, we're very much still investing in growth of a substantial amount of the investment that we've made in growth, particularly sales and marketing have been done in previous years. So we think we're appropriately staffed up and I think when you look at our model going forward.
<unk> expenses above the line as well as below the line are going to increase, albeit they will increase at a lower rate than what we're expecting to drive top line revenue.
Yes. This is Alan.
Agree with Ralph I would say the only thing that might be interesting to that as he said we're already done in sales marketing some of the stuff that we're doing and you heard us refer to a eight figure deal which is to investigate deal. It's possible that we're going to need to continue to add personnel in the R&D and <unk>.
<unk> side to make sure that we continue to expand.
That product, which is already quite nice but to continue to expand that even more to get the large deals.
Great. Thanks.
Our next question comes from Mike Latimore with Northland Capital markets. Please go ahead.
Yes, yes, congrats on the strong results or outlook.
On this.
Hi, Ray VLSI interesting existing centers eight linear miles can you talk a little bit about that.
What was the catalyst for that deal and what kind of pricing do you get on that relative to I guess square miles from maybe the Tam and you might see for us overtime.
Yes, so from a use case point of view were seen across the nation, a fairly measurable uptick in what I would describe as kind of road rage shootings and.
And gang activity, that's happening on freeways highways and just op freeways and highways. This is our second freeway deployment from a pipeline point of view, we're seeing a lot more interest than we had seen previously.
I would say from a technology innovation point of view, what we're doing is really quite interesting because if you think about a lot of the kind of ambient noise that happens in a long pre ways and the fact that these deployments are linear versus typically kind of square miles. It does represent some really interesting and kind of cool technology things that we have to do using our kind.
It's kind of core technology, we didn't have to do a lot too.
The hardware or anything like that but just from a software and deployment point of view.
There's definitely some things that we are bringing to the table that makes this a viable solution I think pricing wise you can think pretty much along the lines of the linear mile kind of more or less equaling a square mile.
Deployment, so it's pretty attractive.
I think from a deployment.
Our operational deployment point of view of these things are pretty interesting because I think the.
Permissions process to get infrastructure to deploy the centers is a little bit more straightforward typically than what we find when we're deploying a square mile because theres a lot of infrastructure in and around the highways that we can place our sensors on so once we get the go ahead to get a deal on a freeway. These are pretty rapid I would say kind of time to value.
<unk> deployments relative to a more kind of traditional.
Kind of square mile deployments.
Alan would you add anything to that or.
No no I think you covered it really well the pricing is very similar to what we do on a square mile just slightly lower but not much.
Alright.
Good to see the margin expansion in fiscal 'twenty three.
Can you talk a little bit about gross margin are you expecting that to expand our fiscal client for as well.
So can you give any guidance on that.
Yes. This is Alan so we do expect gross margin to go up we're in the high 59 Russ.
Roughly percent by the end of this year, we do expect it to be at least 6%.
Our expectation is that.
Some of the cost that is causing a little bit of the gross margin to not go so much higher than that is related to the <unk> sensors that by the way are completely.
Replace at this point over 5000 sensors, a little bit of that increase is the are the actual cogs, but it gets added back in terms of the adjusted EBITDA number so.
Even though that does affect that put us closer to the 60% maybe 61% gross margin gets added back and gets us closer to that.
Guidance of the 24% to 26% adjusted EBITDA.
Got it got it okay, great. Thanks, a lot.
Thank you great questions.
Our next question comes from Matt Pfau with William Blair. Please go ahead.
Okay, great. Thanks for taking my questions I wanted to first ask on the revenue guidance for 2020 to maybe discuss what drove the slight reduction in the high end and then for the 2023 revenue guidance, how do you feel about the visibility entering 2023 realm.
<unk> to 2022, because I think if I look at the <unk> relative to your original guidance for 2022, and it seems to be similar visibility wanted to know if that's correct or if it's more or less.
Sure. This is Alan I'll go ahead, and Darden, Ralph going to add a correct along the way.
Obviously, there wasn't much of a change in our actual guidance, we still expect it to be 40% growth year to date.
From last year are the two things that might be related to that as you heard in routes.
Our original script.
The delay in the large investigator contract, which moved from a seven figure deal to an eight figure deal. We had originally expected to get that a little earlier in the year. If that were early in the year. It would have added to revenues to us in this year.
And then the only other thing related to that would be related to the actual go lives, which always move around a little bit and make a little bit lumpiness into it other than that.
It's really been quite positive too so when we look at 'twenty three having that large investigate they'll come in has given us more.
Confidence in exactly where we're going to end in 'twenty three.
If you're above the thoughts there, yes, no I completely agree with everything that you set out and I think I would just add to that I think it's probably worth pointing out that the Detroit deal that we recently.
One in recently just got contracted on and are moving forward with frankly. This is something that we expected to happen in kind of Q1 or Q2 of this year versus Q4, but I think as by those of you that followed the company and kind of followed our our progress in Detroit that deal got delayed.
Several months.
But we're really happy with where we are now and are looking forward to getting that deployed and operational for the citizens of Detroit in early in early Q1 of 2023, So I think that had a bit of an impact as well on the revenue for this year that was the deal fairly significant deal that.
We thought we were going to happen that we expected to happen earlier in the year versus later of the year.
Okay.
Great and then one more from me on the $17 million and of that $80 million IRR that is coming from non gunshot detection products. How would that look in 2022, I'm trying to figure out as a percentage of IRR, how much that has grown over the past year.
Okay.
Yes. So this is Alan.
So when we looked at the the change there the $63 million that we originally had.
Start of the year did not include any of the forensic logic. So if you think about the forensics.
<unk> logic that does add some into the air are the starting point for two.
<unk> 23.
There's roughly $6 million of it is there the balances related to the other growth that we've had and the miles when you think about us going live in 120 miles.
This year that adds a significant amount of IRR.
That is outside of the.
That's part of the original though the balance is related to the.
The leads and the forensic logic and some expansion into connect and start of somebody investigate products.
Okay.
Great. Thanks, I appreciate it.
Okay, and if you'd like to ask a question. Please press Star then one at this time.
Your next question comes from Jeremy Hamblin with Craig Hallum Capital. Please go ahead.
Hi, Thanks, guys. This is Jack on for Jeremy.
My first question is just on the rollout of some of these contracts that you guys recently more recently won so.
Contracts like Detroit, and Cleveland is it still about six to nine months to go live from wind.
Also improves it.
So when you start generating revenue and kind of related.
How does that timing compared to say, Suffolk County, who has just reactivate and coverage.
Yes. So this is Ralph I'll start now and jump in so I think it is important to note. There is a couple of steps in the procurement process before we start actually working on a deployment strategy with a customer in.
In the case of Detroit, we were awarded the contract and then we successfully negotiated and executed contract, which is enabling us to begin to work in Detroit and we expect that to be.
Fairly fully deployed I would say in Q1 of 2000 2023 in the case of Cleveland, and Suffolk County, which were both really where both.
Excuse me about both of those particular deals those deals have been awarded but we still haven't put ink on paper on the contract yet and so our expectation is that those will hopefully get contracted over the next 30 to maybe 45 days and we would start to work on them late this year, possibly early in the quarter too.
23, So I think Suffolk County, which I think publicly as reported Theyre looking at.
Coming back onto the Shotspotter platform with 20 plus miles in Cleveland is a 10 square mile expansion I think we can think in terms of those miles being deployed in late late Q1, probably early Q2 based on.
How quickly we can get the contracting so awarding this important step but doesn't get us all the way there we got to go work on the contract now.
Great. Thank you that's great color.
Kind of switching gears then in terms of the legal costs you guys saw from the Vice media lawsuit.
Just an update on those cost completely behind you and if so when can we expect to see that fully.
Flow through to EBITDA margins.
Sure. This is Alan I'll start with the answer there too.
Our cost for legal last year, where we're over $2 million. This year, there are about $1 million in the half so far year to date so.
They have started to go down.
We expect Q4 to be lower than both Q2 and Q3. So that's a good thing it is related to the device media now, but that has been dismissed the costs related to that have gone down to basically zero, we still do have some other legal related costs related to increased <unk>.
Peanut activity things that are pretty normal with our business that but have gone up a little bit in the last year.
Overall, though we are expecting to answer your question directly we'll have less and legal costs next year than we've had in 'twenty. Two that's going to help our opex go down in that particular category, which is also going to help contribute to the increase in adjusted EBITDA.
Awesome, Great and then maybe if I could just squeak in one more.
Could you guys give any update on.
Maybe just talk a little bit more to the forensic logic those delays and those expected.
The expected contracts and just overall, how forensic logics and leads have been tracking.
And maybe just their contribution to <unk>.
Do you want to take that.
Yeah, I'll start with that so.
We originally during the year said that forensic logic would produce about $6 million in revenue for us this year.
Actually a little north of that.
We had hoped originally that we would have a couple of other larger contracts, which if you add them together represent several million dollars to already be under contract and to start producing revenue. The good news is none of those have gone away.
The I guess, if there is bad news is that they have been delayed a little bit.
So that's primarily why we haven't increased.
Too much more in forensic logic for 2022, we do expect forensic logic to have.
A couple of million dollars of increase in revenue into 'twenty three it's one of the reasons that we're feeling pretty confident about getting to our guidance range of 94 to 96.
Awesome. Thanks, that's all for me.
At this time. This concludes our question and answer session. If your question was not taken you may contact Shotspotter Investor relations team by E mailing SSP I Gateway IR Dot Com I would now like to turn the call back over to Mr. Clark for his closing remarks.
Yeah.
Hey, Thank you very much we really appreciate everyone joining us today on a mid term election day I Trust, everyone is going to exercise their civic duty today, if they haven't already but.
But to summarize I mean, we continue to view our profitable growth journey as a positive one we're proving our value every single day, and helping law enforcement and our police customers, helping protect help protect and serve the communities that they are obligated to so thank you all very much and looking forward to talk to you over.
Next several weeks.
Thank you for joining us today for today's call you may now disconnect.