Good day and welcome to the Smith Micro Software Fourth Quarter and Full Year 2016 Financial Results Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Charles Messman, Vice President of Investor Relations and Corporate Development. Please go ahead, sir.

Thank you, operator and good afternoon everyone. Thank you for joining us today to discuss Smith Micro Software’s financial results for the fourth quarter and year end results ended December 31, 2016. By now, you should have received a copy of the press release with our financial results. If you do not have a copy and would like one, please visit the Investor Relations section of our website at www.smithmicro.com or call us at 949-362-5800 and we will email one to you. On today’s call, we have Bill Smith, Chairman, President and Chief Executive Officer of Smith Micro; Steve Ziggy Yasbek, Chief Financial Officer. Please note that some of the information you will hear during our discussion today will consist of forward-looking statements, including without limitation those regarding the company’s future revenue and profitability, new product development and new market opportunities, operating expenses and company’s cash reserves. Actual results or trends could differ materially from our forecast due to a variety of factors. For more information, please refer to our risk factors discussed in Smith Micro’s Form 10-K for 2016 and Form 10-Q filings for the three quarters for fiscal 2016. Smith Micro assumes no obligation to update any forward-looking statements or information which speak only as of the respective dates. Before I turn the call over to Bill Smith, I want to point out that in the forthcoming prepared remarks, we will refer to certain non-GAAP financial measures. Please refer back to our press release disseminated earlier today for a reconciliation of the non-GAAP financial measures. With that, I’ll now turn the call over to Bill. Bill?

Thanks, Charlie. Good afternoon. Thank you for joining us today for our fourth quarter and year-end results. Total revenue for the fourth quarter was $7.1 million, up approximately 9% sequentially from the third quarter and down from the $10 million reported in the fourth quarter last year. Non-GAAP net loss for the fourth quarter was $1.9 million or $0.15 per share, this compared to non-GAAP net income of $4,000, or breakeven the same quarter last year. The year-over-year results were primarily driven by the decision by Sprint in January of 2016 do not continue to use our NetWise Wi-Fi offload software as they work to reduce their operating expenses. Before I turn the call over to Ziggy to review our financial results in more detail, I would like to outline the significance that’s taken during the fourth quarter and continuing into the current quarter to restructure our entire organization, reducing cost, creating better utilization of resources and streamlining our processes. These included impacts to our employee base, office locations and overall resources of the company, to better align our expenses with our strategic growth plans for the current year. We have decided to take advantage of our lower cost European locations of Braga, Portugal and Belgrade, Serbia and Pittsburgh here in the U.S. These changes have come in the expense of our traditional locations in California where costs have continued to grow. We expect these changes will not impact our revenue but will enable a rapid return to profitability and generation of meaningful free cash flow in 2017. First off, looking at the changes we made to our overall cost base. Starting in the fourth quarter and continuing in the current first quarter, we have implemented a significant restructuring of the organization across the Board. As part of this plan,…

Thank you, Bill. I first want to go over our customary introductory items. As we have in past quarters, we have provided non-GAAP results and a reconciliation of non-GAAP and GAAP results. The non-GAAP results discussed on this call net out stock-based compensation related expenses, the amortization of intangible assets, asset impairment charges, fair value changes in liabilities, the amortization of notes, discount and issuance cost and adjust for pro forma tax expense or benefit to provide comparable operating results. Accordingly, all results that I refer to in my prepared remarks for both 2016 and 2015 are non-GAAP amount. Our earnings release which will be furnished to the SEC on Form 8-K contains a presentation of selected GAAP financial measures and related non-GAAP financial measures and a reconciliation of the differences of the two. The earnings release can also be found in the Investor Relations section of our website at smithmicro.com. Total revenue for 2016 was $20.2 million, a decrease of $11.3 million or 20.5% from $39.5 million in 2015. Wireless revenues at $23.1 million decreased $10.5 million or 31.2% in 2016 primarily due to Sprint. Graphics revenue was $5.1 million, a decrease of $800,000 or 13.5%. From a non-GAAP perspective, total year 2016 loss per share was $0.72 as compared to a loss per share of $0.02 in 2015. From a balance sheet perspective, our cash position was $2.2 million at December 31, 2016, a decrease of $10.7 million from the beginning of the year. In terms of our currently completed fourth quarter, let me provide some details. For the financial modelers, let me provide the difference between GAAP and non-GAAP P&L metrics. In terms of stock compensation, stock comp totaled $353,000 for the current period, broken out as follows; $39,000 sales and marketing, $119,000 R&D and $195,000 G&A.…

Thanks, Ziggy. Before I get into some of the details about our focus for 2017, let me start by giving some guiding principles. We are pleased to be able to talk about a very broad wireless product line up including our NetWise family for carrier and cable network optimization, CommSuite for wireless messaging, QuickLink for wireless connectivity and SafePath for a variety of location based services. We will continue to sell our entire product offerings and meet the needs of our carrier and cable customers as well as to provide solutions for device manufacturers and enterprises. That said, our primary focus for 2017 is to grow our revenues in a profitable manner and to liberate our prowess to once again make Smith Micro a growth oriented company with a growth [indiscernible]. To achieve this, we will focus on those products that are quickest to sell and easiest to implement thus providing the maximum impact of both our top and bottom line in the shortest period of time. We have chosen two product areas for enhanced focus with our sales effort. First we will zero-in on the sale of our SafePath Family of products and second, we will focus on the sale of our Device Management firmware update products from our NetWise family. Now let’s talk about the – issues we are pushing forward and some exciting trends we are seeing particularly after last week attending Mobile World Congress in Barcelona. First let’s start with our SafePath product platform that is garnering significant interest with our carrier and cable customer. As most of you know, we acquired the SafePath Family suite with the acquisition of iMobileMagic, offering a next generation cloud based white label platform that enables carrier and cable/MSOs to provide location and protection services to their mobile subscribers as…

Thank you. [Operator Instructions]. We’ll take our first question from Ian Gilson with Zacks Investment Research.

Good afternoon, gentlemen.

Hi, Ian.

Hi. From what you said Bill, it looks like you’re moving the focus of the company to outside of the United States.

That’s a fair statement.

Does that mean that you expect the bulk of your growth comes from carriers that are outside the U.S.?

No, no, it’s just that our workforce predominantly will be outside of the U.S. base and the workforce in the U.S. will be predominantly based in Pittsburgh, but we will continue to service our traditional strength carriers that are here in North America and of course yeah, we are looking for further growth in Europe and Asia-Pac. So, yeah, but that part hasn’t changed.

Okay, you kind of moved the corporate headquarters?

Yeah, that’s a decision that we’ll be looking at and talking about, that’s not something we’re going to say anything about it at this point, clearly from a just a pure sizing headcount, the largest location by far is Pittsburgh.

Okay, fine. Thank you very much.

Thank you.

And we’ll go next to Scott Reed with Vict10n Capital Strategies.

Hi, everyone. So sort of quick, it sounds like you are just back of the envelope guiding to revenue probably north of about $10 million per quarter in the second half of the year, and I’m just basing that on very rough calculations here. But with that in mind, would you characterize that revenue projection as being tied to any one or two specific deals that you have in process or is that sort of an estimate based on a handful of deals and projected close rate based on those deals and the deal sizes?

Okay, let me first say, we’re not giving guidance so I just want to be clear about that. Now as to the numbers that you came up with, we’re looking for some meaningful growth and we’re looking for meaningful growth predominantly in the second half of the year but we’d like to see some growth in the front half as well. We are looking for profitability, we’re looking for the generation of cash and adding that building our cash free reserves back up. We believe that much of the growth will come from the sale of the two focused products that I spoke of, it will come from the sale of SafePath, it will come from the sale of our Device Management over-the-air update services. We will continue to sell the balance of the portfolio, but if you really want to focus on where we can make a significant difference, it’s going to come from those two families. I outlined in my prepared script, I think some significant growth opportunities that are in the SafePath area. I would say to you that we believe SafePath offers us the greatest single upside for 2017 and beyond. We have a great product, it’s relatively straightforward to sell, it is very easy to implement and it is a quicker sale than some of our other more complex products. That said, we’re looking for that growth to come from a number of different deals, some will obviously be larger than others and I alluded to couple of Tier 1 deals and Tier 1 just by pure size and to me the bigger deals that we’re going to focus on.

Okay, great. Two more questions that are more high level about the wireless industry generally and this is a bit of a U.S. focused here I suppose, but overall, of course last year was a little tough on the company because Sprint decided to drop use of your NetWise product. Is there a chance now that things look a little bit better for Sprint’s operations that you might be able to win back that account?

I really don’t want to comment on that publicly I mean clearly that would be fondest hope, and it’s obviously something that our account team is working on. I can’t give you any encouragement at this point that that will happen, we’ll just have to wait and see.

Gotcha. And then finally, would a merger and this is of course based on pure speculation and rumors, but a merger of T-Mobile with either Sprint or Comcast, if that were to happen, would you see that as being additive to your situation or is it too early to speculate on something like that?

Well yeah, it is a little early I mean, both Sprint and Comcast are meaningful customers to us that we have a lot of work that we do with, but I think a lot has to play out. I think it has to become a lot clear whether SoftBank wants to be a seller or a buyer and I don’t think that’s clear yet and these things take some time in any event. So, I don’t think it really has a significant impact on 2017.

Thank you.

[Operator Instructions]. And we have no further questions in the queue at this time. I’d like turn the call back over to Charles Messman for any additional or closing remarks.

I want to thank you every one for joining us today. We look forward to speaking to you on the next call. Should you have any further questions or comments, please feel free to call in the office. Again thanks again and we’ll talk to you in our next quarter conference call. Bye

And that does conclude today’s conference. Thank you for your participation and you may now disconnect.