Operator
Good afternoon, ladies and gentlemen, and welcome to today's Recourse Systems, Inc. conference call. My name is Diego, and I will be your coordinator for today. At this time, all participants are in a listen-only mode. A brief question and answer session will follow a formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference call is being recorded for replay purposes. Before we start, I want to read you the company's abbreviated safe harbor statement. I want to remind you that statements made in this conference call concerning future revenues, results of operations, financial position, markets, economic conditions, products and product releases, partnerships, and any other statements that may be construed as a prediction of future performance or events are forward-looking statements. Such statements can involve known and unknown risks and uncertainties and other factors. which may cause actual results to differ materially from those expressed or implied by such statements. We ask you that you refer to the full disclaimers in our earnings release. You should also review a description of the risk factors contained in our annual and quarterly filings with the SEC. Non-GAAP results will also be discussed on the call. The company believes the presentation of non-GAAP information provides useful supplementary data concerning the company's ongoing operations and is provided for informational purposes only. I would now like to turn the presentation over to Mr. David Darnays, President and CEO of ReCore Systems.
David Darnays
Good afternoon, and thank you for joining us today. As I conclude my first full quarter as President and CEO of ReCore Systems, I am pleased to share our solid progress in the quarter and strategic vision for the future. Over the past 90 days since stepping into this role, I've delved deeply into every aspect of our business. I've been focusing on refining our financial processes, enhancing the work that we are doing in government relations, and driving operational excellence across our sales team and field operations. My commitment is to establish and strengthen the governance structures and scaling mechanisms that will help transform ReCore into a more predictable growth engine. And I'm encouraged by the team's positive response to the direction and priorities that I've set and the substantial progress we've made so far. Also, over the past three months, I've had the privilege of engaging with many of our investors and shareholders globally. Your insights have been invaluable to me, and I want you to know that I'm listening. Our conversations have reinforced three key themes, strong enthusiasm for our market position and opportunities, concerns about securing necessary capital to continue our significant growth trajectory amidst macroeconomic uncertainty and slow government contracting cycles, and finally, eagerness for meaningful customer traction. Today, I'll address these three areas and provide insight into our path forward. To begin with, Let me stress that navigating the complex procurement processes of federal, state, and local government agencies is challenging, but it also provides an opportunity with unparalleled long-range stability and growth potential. While we've been fielding our AI-based solutions in the transportation and traffic segments for just over a year at this point, namely our Discover and Command platforms, we have moved at a rapid pace. gaining awareness, preference, and adoption across multiple states, including South Carolina, Georgia, Florida, New Mexico, Texas, Colorado, Ohio, Maryland, Oklahoma, Kansas, Oregon, and multiple others in the works. However, it is important that we remain realistic, given that the government contracting process is opaque at best and has its own pace and timeline. It is something that we will continue to be conservative with in setting expectations as it relates to timing of deals and expansion. Along this line, and as an update to our last earnings call, I wanted to update you on the upcoming deployment of up to 1,000 Discover and Edge units, equating to a potential upside of approximately $35 million in revenue in one of the largest states in the U.S. as they finalized their AI policy. As of today, I'm pleased to share that we've initiated deployments in the region. However, progress has been hampered by continuous interruptions resulting from multiple storms this hurricane season, most recently by Hurricane Debbie. We don't control these things, of course, but the state does not permit anybody to work roadside in hazardous weather conditions in the period leading up to the storm, during the storm itself, of course, but also in the immediate aftermath. Understandably, this has impacted our expected timeline for deployments as the state is prioritizing emergency response efforts for its citizens. But the initial sites we have already activated have performed flawlessly under these extreme conditions and have already proven to be mission critical, delivering vital insights to the state's Emergency Operations Center to support evacuation routes during these storms. This underscores the essential role our technology plays further cementing RECOR as a trusted and indispensable partner in this state, which will pay dividends. As I also highlighted in the previous call, the transportation infrastructure industry is undergoing a massive and generational technology refresh, and that within our existing southeast footprint alone, we see the potential to add 6,000 to 8,000 sites, which could generate an estimated 200 to 300 million in cash flows over the coming years. RCOR's reputation as a trusted partner in the southeastern states has never been stronger, and our success is being closely monitored by other states nationwide as we continue to execute our growth strategy. Given our recent performance with these states during these crises, it only positions us more strongly for our continued expansion in the region. Our growing recognition and reputation along with the ongoing infrastructure overhaul that is happening, puts us in an ideal spot to capitalize on this transformative period in the industry. So while we must continue to navigate the complex and often slow-moving procurement processes of state and local governments, it also provides us a unique opportunity for long-term and durable growth that we believe will benefit our investors in the long run. Despite the relatively short time we've been deploying our technology in the market, we're experiencing continuous, accelerated growth, and I'm confident and our ability to sustain this momentum. Later in the call, I'll discuss some of the new contracts we've secured during the last quarter and examples of meaningful traction we're experiencing. Before diving into these details, I'll now hand the call over to Eyal Hen, Recourse CFO. He'll review our financial highlights for the quarter and discuss the proactive steps we're taking to solidify our capital position and protect our shareholders as we navigate the uncertainties of the current macroeconomic environment and B2G domain. Eyal?
Recourse CFO
Thank you, David. Hello, everyone, and thanks for joining us today to discuss our results for the sixth and three months and the June 30, 2024. I would like to start with our recent announcement that we have just infused $15 million into the company for a facility that can provide up to another $20 million in capital should we need it. The agreement is designed with strong shareholder protection. including a $2.6 million monthly cap on prepaid balance conversions to equity and a ban on short selling by the counterparty, which minimizes dilution and allows us to draw less capital or repay the notes early once our expected contracts materialize. Full details about this agreement have been provided in our 8 concerning the financing, and I won't delve into them now. Suffice it to say that this gives us the necessary resources to address the recent government contract delays we've been facing. This injection of funds positions us to meet our 2024 growth targets. And as is shown by our Q2 performance, we are making solid progress against this. We've continued to drive operational efficiencies and carefully manage our cash flow to ensure it is used effectively At the same time, we have improved our metrics year-over-year and quarter-over-quarter. Going forward, some of the larger recurring revenue contracts we are pursuing may involve significant upfront installation expenses. If additional capital is needed for this implementation, we plan to prioritize non-diluted financing options, such as issuing an additional series to our revenue sharing We expect to continue to address our capital needs prudently, expanding our industry leadership and fulfilling our customer commitment as new. In this regard, we have engaged VC Ziegler and Company, a specialty investment bank, to service as placement agent and market maker in connection with future issuances of our revenue sharing notes. Over the past few months, we've been in discussions with them as well as with rating agencies to work on getting these notes rated, which should help reduce overall costs and improve their marketability. We anticipate continuing to use this structure, which aligns potential future debt to the growth of fully performing contracts as a primary funding source of additional growth capital. Now I'm pleased to talk about our financial highlights. for the three and six months ended June 30, 2024. In the second quarter of 2024, our revenue reached a record revenue of $12.4 million, marking a significant growth of 45% increase from the $8.6 million in the same period last year. We also demonstrated a robust revenue growth quarter over quarter at over 27% above Q1, 2024. In the six months and the June 30, 2024, we achieved $22.2 million in revenue, an increase of 51% from the $14.7 million we marked in the same period last year. Recurrent revenue also increased by 8.9% from $5.8 million in the same quarter of 2023, compared to $6.3 million in the same quarter of 2024. Our adjusted gross margin for the three months ended June 30, 2024, was 53.5%, an increase from 51.8% in the second quarter of 2023. This increase was primarily due to higher margin mix of sales during this quarter. As previously explained, we expect a primary benefit of our technology refresh efforts to allow us to move from lower margins to higher margin sales over time. However, during the early growth phase we are in, this evolution may be choppy, as we saw at the beginning of this year. The adjusted gross margin for the six months ended June 30, 2024 was 50.2%, a decrease from 52.5% for the same period last year. The decrease is mainly due to lower margins we experienced at the beginning of the year. We also continue to see improvements in our adjusted EBITDA loss. For our second quarter, it now stands at $5.8 million, an improvement of over 19% from the $7.2 million in the same period last year. The adjusted EBITDA loss for the six months ended June 30, 2024, was down to $15.2 million from $16.5 million the same period last year. Lastly, another significant development in the second quarter of 2024 was the exercise of 3,675,000 warrants in June 2024, which resulted in $5.2 million of cash to the company, of which $3.2 million was received in July after the balance sheet date. Also in July, we sold our remaining 19.9% ownership of global public safety for $1.5 million. And of course, as I highlighted earlier, we received $15 million under our prepaid advance agreement, which has been structured to provide up to $35 million under appropriate circumstances. In summary, we are very pleased with our solid second quarter results and the synergetics and accretive impact of our recent acquisitions. Our capital raise and the engagement with Ziegler are instrumental enablers in continuing to secure our leadership position in the industry. Our financial and operational strategies are designed to capitalize on future growth opportunities. Looking forward, we continue to be confident in the potential of our technological developments, strategic acquisition, and are grateful for continued support of our investors. Now I will turn the call back to David to cover additional business highlights from the quarter. David?
David Darnays
Thanks, Eyal. As Eyal highlighted, we delivered a solid Q2, performing well against all metrics and achieving the highest top line revenue in our history. And with the capital now in place to support our continued growth, we are laser focused on executing Our customer expansion plans and driving what we expect will be a strong year-over-year growth, along with a healthy pipeline dynamic heading into 2025. Now, I'd like to share some important business highlights from the quarter. As mentioned earlier, a major theme I've heard from investors is a strong enthusiasm for our market position and opportunity, and eagerness to see customer traction. I'm pleased to share that the progress we've made in the past quarter across each of our business segments is meaningful. and continues to lay a solid foundation for continued growth. Recore's industry reputation as the leader in roadway intelligence is steadily growing, with our brand and AI-based solutions gaining recognition across multiple high-profile forums and institutions. We are regularly invited to share our insights and success stories in local and national media, underscoring our thought leadership in the future of AI and transportation. We were also proud to recently have the Baltimore Business Journal recognizes as the number one fastest growing company in the region, as well as highlight our commitment to digitizing critical transportation infrastructure across the nation. Additionally, we were honored with a special invitation to join a high-profile panel alongside leaders from TxDOT and Amazon slash AWS. During the event, the CIO of TxDOT highlighted RECOR's industry leadership and the significant impact of our technology in Texas. Notably, RECOR Command was credited with helping achieve a 29% reduction in secondary crashes and a 44-minute improvement in incident resolution times, underscoring our vital role in their mission-critical efforts to save lives on their roadways. This quarter, RECOR was prominently featured by ITS America as a leading force in the current and future landscape of AI for digital infrastructure and transportation. They highlighted multiple RECOR use cases where we are proving to improve transportation and citizen safety across state and local roadways. This recognition, along with the award of multiple new technology patents we received this year, reflects our team's ongoing commitment to advancing the state-of-the-art of roadway intelligence. Our proven technology solutions are centered around our three growth pillars, public safety with our Scout platform, transportation management with Command, and urban mobility with Discover. I'd like to start with our first growth pillar, public safety and Scout. Recur's reputation as a leader in AI-based vehicle and license plate recognition is well known and continues to grow in what is a noisy and fragmented market. We believe that the future of this industry sector will be defined by open platforms and seamless integration into existing public safety infrastructure, principles that are central to our growth strategy. As such, our focus has been and remains on integrating our technology into existing law enforcement and security systems while expanding our market reach through partnerships with OEMs, resellers, and third-party channels. A key example of this strategy in action is our recently announced partnership with Sound Thinking, a leading public safety technology company known for delivering AI and data-driven solutions to law enforcement, civic leaders, and security professionals. Sound Thinking is already trusted by thousands of public safety agencies across the U.S. By integrating Scout technology with their ShotSpotter gunshot detection solution, we are providing an end-to-end public safety offering through new go-to-market channels that immediately enhances public safety for major cities and strengthens Recore's presence in key markets. In addition, this quarter, Scout was recognized by Amazon Web Services as the first in the industry to achieve the well-architected stamp of approval, joining the rest of our portfolio in the marketplace. This achievement is important because not only does it speak volumes about the strength and differentiation of our technology, but also brings Scout into the highly selective AWS marketplace. It also expands our reach by enabling customers to access Scout through the AWS Partner Network and Amazon Business Distribution and procurement channels. This positions us to integrate more seamlessly with leading technology platforms, ensuring that our offerings are accessible to a wider audience. Also, we expanded our relationship with NVIDIA, as well as our participation in their Metropolis Partner Network, building upon NVIDIA's most advanced Jetpack technology for our customers. Our deep technical collaboration with NVIDIA powers our advanced computer vision and machine learning technologies, accelerating time to market for new features and simplifying customer adoption. Looking ahead in the public safety segment, we are focused on licensing our vehicle recognition SDK through third-party e-commerce platforms and developer portals. This approach will empower third-party developers to create new innovative market applications that leverage reCORE technology at their core. In addition to this, we're developing the next generation of Scout. Our next gen platform not only promises to strengthen our leadership in the public safety sector, but also pave the way for continued growth and innovation across the industry and with our partners. Moving on to pillar two, our transportation management segment and the reCORE command platform. Departments of Transportation are confronting an increasingly complex and demanding environment in their mission to ensure roadway safety and keep traffic moving. With the increase of sophisticated vehicles, the growing issue of distracted driving, aging roadway infrastructure, and never-ending road work and traffic interruptions, the challenges are multiplying for these agencies. Compounding these difficulties are the deep organizational and data silos that DOTs must navigate to try to keep traffic flowing and people safe. The situation is further strained by the rapidly increasing retirement of seasoned DOT professionals from the agencies, and the ongoing struggle to recruit skilled talent quickly enough to meet these escalating demands. The record command platform addresses these challenges by providing tools that are full-stack solutions versus silos, and that leverage AI to process and integrate massive and disparate data sets, turning them into actionable insights that can be shared across departments and agencies in a single source of truth and a single pane of glass. This comprehensive view of roadway and mobility data provides real-time visualization, situational awareness, predictive analytics, and more, enabling agencies to effectively manage roadways despite the increasing demands and limited resources. As mentioned earlier, our work with TxDOT has been particularly impactful for Texas roadways and recognized across the U.S. Building on this momentum and in alignment with TxDOT's record-breaking $142 billion investment in transportation infrastructure over the next 10 years, we launched the Construction Partner Program this quarter with TxDOT. CPP is a vital, citizen-facing app powered by command designed to enhance mobility and roadway safety. across Texas through real-time incident monitoring and work zone management. Additionally, in collaboration with TxDOT and the University of Texas at Austin, we developed an economic benefit calculator that assesses and validates the efficiency and monetary benefits of key metrics like crash reduction and congestion improvement, helping any transportation agency clearly understand and visually see the return on investment they make in our command platform. But our progress isn't limited to Texas. We're pleased to also announce the initial adoption of the command platform in Oklahoma and Kansas, further extending our reach and ability to drive influence and adoption across state lines as we build out a connected network of smart roadways, both regionally and nationally. Similarly, in Oregon, Umatilla County announced their adoption of command. In conjunction with the state's connected vehicle ecosystem, bringing advanced roadway intelligence to the unique challenges facing rural areas and communities, and supporting the work we're doing with Oregon DOT's Road Usage Charge program statewide. These developments highlight the growing recognition and adoption of command across the country. Expansion of our footprint in this segment underscores our commitment to transforming roadway and traffic management by delivering unprecedented visibility and insights that legacy systems just can't offer. Our solutions enable agencies to monitor traffic in real time, break the data and organizational silos, and utilize AI-driven insights to respond to incidences faster, reduce response times, and vastly improve the time it takes to get roads back to normal. Our continued innovations and strategic partnerships ensure that we will continue to lead the way in providing the technology and insights needed for smarter, safer, and more efficient roadways. Last but not least, I'd like to share some progress that we've made this quarter in the third growth pillar, our urban mobility segment and our RECOR Discover platform. As mentioned in our last earnings call, the traffic data collection industry is at a pivotal moment, which is a significant growth driver for RECOR. We believe we are leading one of the largest legacy data collection technology refreshes in the U.S., where millions of outdated and legacy-based traffic study sites across the U.S. roadways will be replaced with advanced AI-driven solutions. Our Discover platform, initially built on the foundation of our 2022 acquisition of Southern Traffic Services, and further strengthened by our acquisition of all traffic data earlier this year, has transformed the permanent and short-term traffic study landscape. It allows us to replace legacy systems with secure, connected, and modular AI-based solutions that integrate seamlessly into existing infrastructure and greatly enhancing safety and sustainability for our customers. The platform's mission-critical status was clearly demonstrated recently during Hurricane Debbie, where we supported multiple states in the southeast in managing roadways and evacuation routes in real time, ensuring citizen safety during emergency operations. This quarter, I'm pleased to share that we were awarded over $15 million in new contracts, highlighting the strong demand for Discover, and better traffic data management reporting as states look to modernize and digitize their legacy roadway infrastructure. Notably, we expanded our reach westward with statewide contracts in Ohio and Texas. These contracts not only cover the maintenance, repair, and replacement of existing infrastructure, but also pave the way to transition failing traffic data collection sites to AI across the state. It's worth noting that this new Texas contract is independent from the work we're already doing in Texas with Command, illustrating our land and expand strategy in action. Our approach is to penetrate a state by delivering clear value with one of our platforms, and then expand to the next platform in our portfolio, and then the next. And along the way, we have the opportunity to continue to layer on new value-added services over the top, such as air quality, electric vehicle studies, weight and tonnage, and more, increasing the value we deliver to the state and our revenue potential. As another example of customer traction, we also announced a new $1.5 million contract with Maryland Department of Transportation to deploy the Discover platform across some of the nation's most heavily used corridors, including I-95, I-495, and I-695. This win, which is over and above our AI-based class count and speed offering, focuses on corridor management and sustainability, incorporating advanced environmental analytics like carbon reduction, EV counting, and air quality monitoring, weight and tonnage, and volume by lane through our new Vehicle Insight solution. These enhancements will help Maryland improve traffic management while addressing environmental concerns, and this has further opened the door to additional opportunities within the state. In addition, we also expanded into Colorado's pick and counting where we are deploying Discover in the highly trafficked Aspen area and surrounding region. This new contract includes our Discover class count and speed offering, as well as air quality monitoring, once again showcasing our ability to grow our footprint by providing value-added services over the top of existing infrastructure. This project supports better roadway planning, maintenance, and sustainability in a region known to drive environmental improvements. Looking ahead, we continue to see significant momentum and opportunities emerging for Discover. Our recent strategic partnership with MS2, a leader in transportation data management for states, is expanding our reach to dozens of new state DOTs and numerous cities and counties across the US. This collaboration, combined with our mission of collecting, connecting, and organizing the world's mobility data to make it useful and accessible for unique insights, positions ReCore on a fast path to becoming the leading roadway intelligence data exchange for the industry, laying a strong foundation for the continued success, holding enormous and durable value at the core of our strategy. As we close out my first full quarter as CEO of ReCore, I'm encouraged by the solid progress we've made across all of our growth pillars. We've continued to navigate the complexities of government procurement, secured multiple multi-million dollar contracts, and expanded our reach into key states like Ohio, Texas, Maryland, Colorado, Kansas, and Oklahoma. Our strategic partnerships with industry leaders such as AWS, NVIDIA, Sound Thinking, and MS2 are further strengthening our market presence and positioning ReCore as a leader in providing roadway intelligence to the industry. As I mentioned earlier, in my discussions with many investors over the past 90 days, the key themes you raised such as market opportunities, capital needs, and meaningful traction have been top of mind for me. We've made important strides in each of these areas in the quarter, securing necessary capital to continue our growth, winning new contracts, and expanding our market footprint. While we remain cautious due to the inherent complexities and unpredictability of government contracting, the traction we've gained this quarter is a strong indication that we're on the right path. We're committed to building on this momentum and continuing to deliver our strategic vision. I look forward to updating you on our continued progress in Q3. Thank you. We'll now move on to Q&A. Operator?
Operator
Thank you. We'll now conduct our question and answer session. If you would like to ask a question, press star one on your telephone keypad. A confirmation tone will indicate that your line is in a question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, It may be necessary to pick up your handset before pressing the star keys. Once again, to ask a question, press star 1 on your telephone keypad. We'll pause for a moment to pull for questions. Thank you. Our first question comes from Michael Lattimore with Northland Capital Markets. Please state your question.
Michael Lattimore
All right, thank you. Yeah, great to see all the news recently, contracts and this 27% sequential growth in quarter here. I guess in terms of this kind of large contract you highlighted here, you know, 1,000 units potentially, I guess, one, are those basically going to go into locations that you currently manage and you upgrade them, or are there also new locations embedded in that? And then what's your thought on, you know, time to get all these deployed now?
David Darnays
Heather, Mike, good to have you on the call. Thanks for the question. So in terms of the large contract, yes, we do have management responsibility for a number of these, but it's a mixture of existing as well as new areas that otherwise would not have been done. areas that would have normally been done with portable or short-term that will move to a more permanent solution because now it can be done. So that's a lot of new opportunity there for us. But to answer your direct question, it is a mixture of existing ones that are scheduled for replacement and new ones that otherwise could not have been done.
Michael Lattimore
Great, and it sounds like you have started to deploy the units, and is there a, what, over what, how many months or quarters do you expect to be able to deploy the thousand, let's say?
David Darnays
Well, we would expect that we're, it's probably, like, it depends on, I would say, a few things. Like, in the area, and I hope you understand, there's expected, and predicted to be about 20 to 24 named storms in the area, 8 to 12 hurricanes between June and November. So again, if those didn't happen, clear sunny days, I would say that we'd probably be in the six-month range to get that through with existing resources. And it could go higher based on that. But I'd say that's what I would expect.
Michael Lattimore
Yeah, I'm near the Gulf Coast and very attuned to those forecasts, for sure.
Recourse CFO
Yes, indeed.
Ziggler
Buckle up.
Michael Lattimore
And then is the pricing model here, and maybe you can't talk about it, is the pricing model kind of the hardware and maintenance one or the full subscription one?
David Darnays
In the cases that we're talking about, because we're talking about a regional area, it varies by the states in the southeast. But the one in particular that I'm referring to is a mixture of hardware and subscription bundled together. So paid up front in the way that the state would like to do that through their procurement processes. But it very much is over time. But I would say it is bundled together.
Michael Lattimore
Okay, great. And then on the Texas news you just had, you characterized that as, you know, I think kind of maintenance and repair. I guess one is that just to clarify that that's what that deal is about. And then two, do you see an opportunity in Texas similar to the one, you know, the one, the large one we just discussed?
David Darnays
So on the Texas opportunity, one of the things that we do well and we're trusted to do is looking to evaluating, maintaining, replacing, repairing existing infrastructure. That's frankly what makes us incredibly valuable to the states. But the opportunity to have line of sight on every device on the roadway is the provision to also replace with AI. So right now, we have access to both of those opportunities, and we're just getting started. So we need to make sure that we're being able to extract every single dollar and earn every single dollar from that opportunity. And it will equate to both existing maintenance as well as replacement for AI.
Michael Lattimore
Great. And just last one on ATD. How is that tracking with your expectations? Have they helped with some of these recent ones?
David Darnays
Yeah, actually very well. I'm very pleased with the acquisition as we have been over time with our STS acquisition as well. Excellent team. It broadened the market for us. We're doing work in new states that we've never done and also now integrating our AI technologies into the workflow. I really, truly could not be happier with that team and also with the progress we're making in terms of integration, but also new business. So, yeah, very well, actually.
Michael Lattimore
Great. Thanks a lot.
David Darnays
Best of luck this year. Thank you. Thank you, Mike.
Operator
Thank you. And a reminder to the audience, to ask a question, press star 1. To remove your question from the queue, press star 2. Our next question comes from Noah Levitz with William Blair. Please state your question.
Noah Levitz
David Nial, good afternoon. This is Noah Levitz on for Louis de Palma. Thank you for taking my questions. Hi. To start off, thank you, thank you. As it relates to your new partnership with Sound Thinking for Plaint Ranger, just to gain some more color, How is your solution going to stack up versus some of the existing solutions already on the market? Will it be priced comparatively to some of the others? And then can you also elaborate on any other differentiators that you're going to provide?
David Darnays
So, yes, a very good question. We're excited about this relationship. Sound Thinking is a respected name and brand in the law enforcement area, and so we're thrilled with the opportunity to work with them. In terms of our go-to-market and pricing, that's really up to how Sound Thinking wants to approach their market. They've got a large install base that will expand into including vehicle recognition and LPR and the connection with Plate Ranger, which is powered by ReCore under the hood of that, and connecting to their ShotSpotter. How does it compare competitively? One of the things I can... I can say objectively through third-party benchmarking is that Recore's license plate recognition and vehicle recognition technology is the top of the stack. So from a competitive nature, we still feel very good about that. In terms of how SoundThinking and their ShotSpotter technology stacks up, we believe and we've heard enough evidence from our customers that This is a leading technology in the market. So to me, it's like chocolate and peanut butter coming together. So you really have an end-to-end solution now for law enforcement to have the tools that they need to increase public safety. And so pricing, it's going to be up to how sound thinking, which is the structure of that with our customers, not us. So I can't comment on that. But our solution together with, sound thinking is where we are effectively working with sound thinking as a channel to market. And so, again, the rest of that engagement will support it, but it really starts with sound thinking. Does that help you understand, Noah?
Noah Levitz
Yeah, no, that was very helpful. And then just a little follow-up on that. Will it be utilizing solar? There's a lot of traction with solar-powered LPR cameras, so I was interested if Plate Ranger will also be doing that.
David Darnays
Yeah, yes, indeed it will. The technology, again, from a physicality standpoint, is record technology under the hood, both from a hardware perspective as well as the software perspective and the AI agents that run. So we've always been solar. So solar is absolutely part of it, and it's, in fact, a strong differentiator for us as well.
Noah Levitz
Great. That was it from me. Thank you very much.
David Darnays
All right. Thanks, Noah.
Operator
Appreciate it. And our next question comes from Casey Ambrecht with Shea Capital. Please state your question.
Casey
Hey, David. Thank you very much for taking the question. Good update to hear this quarter. Just a couple of clarifications here. The $35 million contract that you guys mentioned last quarter that you talked about today, I assume based on the hurricane conference, or it's probably Florida. But I just wanted to get a sense that, If it's over six months, just at the minimum, which it sounds like it's probably going to be more just depending on how it's falling this time of the year, that adds about $6 million. $6 million, if it's equal, if it's straight line, that adds about $6 million of revenue a quarter. How do we think about profitability for re-quarter when a contract this size comes online? Okay.
David Darnays
Trying to understand. I don't know, AL, maybe you understand the question better than I do.
Casey
I mean, you guys lost $5.5 million of EBITDA this quarter. And if you start bringing in this contract, that should add $6 million a month in revenue. If you just say it's going to take six months, which is a $35 million contract. How do we think about, how does that impact your profitability?
David Darnays
So you wouldn't do it all at once. Let me make sure I understand. So effectively, over a span of, say, six months, you're going to be putting in X number per week or per month and per quarter, et cetera. So you're going to ramp into that over time. And the way that the contract would be structured here is that it would be paying up front. So you would realize that linearly. Through the period of time, you know, as fast as you can put things in, the faster that turns on. Is that answer? Am I getting to the heart of your question, Casey?