going forward with some additional projects. So I think we have pretty good visibility into that kind of lumpy revenue that can help us get to the, you know, $99 to $100 million in guidance. We also have a pretty nice pipeline of over 100 lanes that are in flight. These are deals that have already been booked. They're various stages of going live with SafePoint. And on an ARR basis, that represents more than $2 million in ARR. So to the extent that we can convert, you know, at least 30% of that, you know, $2 million, that gives us a pretty good deal of confidence that we can get to where we need to get to get to the number. And then with respect to ShotSpot, I think we've been fairly conservative in terms of, you know, looking at, you know, basically seven go lives. There's probably about 15 or so deals that are either booked or soon to be booked, and we're counting on about seven of those to go live. In fact, one of them is a city that we've already deployed the technology on. It's a Midwestern city. They were supposed to go live before the World Cup, but due to the complexity of getting the drawdowns from the federal government on funding, they've been stalled. And so the minute that that funding becomes released, we can effectively flip the switch and go live on a revenue basis. So we're expecting that to be a part of those kind of seven-go-live projects as a part of the 300, 400-plus additional revenue we expect to get from Shotsfire. So I would say we have fairly good visibility of that. We want to give ourselves the space to hit the number so that we can kind of focus on growing the business and addressing some of the sales execution issues that we have domestically. Did that answer your question, Alan? Did I get anything wrong?

No, I think you answered it appropriately.

Thank you. Our next question is from Trevor Walsh with Citizens. Please proceed with your question.

Great. Hey, Ralph and Alan, thanks for taking the questions. Maybe to start off, Ralph, you mentioned with respect to SafePoint that just overall deployment and operationalizing of lanes is kind of holding back the revenue kind of picture there. Has there been a fundamental change recently that's just slowing things down, or was this sort of a known, I guess, dynamic, I suppose, when you kind of first did the acquisition and brought them kind of within the sound thinking family? Or just a little bit more color on kind of why that's happening now or if that's just the nature of the business for them?

Yeah, sure. So I'll answer the question operationally, and then Alan can talk about the kind of gap revenue flip over that we did. So operationally, what we're finding is, as we've kind of gone from kind of one to two lanes per enterprise to like 10 to 20 lanes per enterprise, it's just a completely different cadence. There's a lot more, I would say, kind of structure and I won't say resistance, but there's a lot more structure dealing with IT organization when they're talking about giving us access to their networks, doing the physical construction or whatever. We're finding that that's a lot more involved than, say, maybe a year ago when we were lighting up maybe one or two lanes per enterprise. So the deals have gotten bigger. And as a result, the go-live cadence has become a little bit more elongated as we're dealing with very mature, structured, this is the way we do things type of IT organizations that we're having to interface with.

Yeah, this is Alan. Just one thing to add. I think Ralph's absolutely correct. If you think about it, we had almost 90 new lanes booked in the second quarter. But when you have that many, it takes you longer to deploy. And one of the things that we have learned very much in the last two years is the deployment and making them the product to perform as the customer expects and we expect sometimes takes a little longer to do. So that's basically why things are getting delayed a little bit. More bookings, strong pipeline, but it's taken us longer to get them deployed in a way that we feel comfortable about the performance and the customers are happy.

Got it. Thanks, Bolt. That's helpful. perspective Alan maybe I'll stick with you if that's okay with you you kind of gave some color in your prepared remarks around why how you got to the guidance you know top line lowering down I think you called out 1.5 from Puerto Rico and then 2 million give or take from from SafePoint correct me if those numbers are incorrect but and then they were and then the balance of that was coming from just general deal slowdowns or just a more broad kind of designation. So I guess for that latter part, is that remaining portion tagged to very specific deals or are you just trying to do your best sort of over under around odds of just kind of what's left in the pipeline and just seeing how just deals generally are tracking or again if it's a little bit more you know one, two, three, two or type of deal that's kind of driving that further number.

Does that make sense? No, it does, and thank you for asking that question. I think it's really important when you look at the amount of our guidance reduction, about $10 million, the good news is about 70% of that is really due to timing. It's not due to contracts that were lost. It's timing related to delivering some of those professional services in New York City and Department of Correction, which, as Ralph mentioned, will start in the second half of the year, and all of those safe point lanes that we booked, you know, that's significant as well. That's like $2 million. That might shift into 27 as well. So when you start adding those up, out of that $10 million reduction, about 70% of that didn't go away. It just shifted to the right. We are expecting that we're going to get some of that in the second half of this year, but the majority of that will probably shift into 2027. But just as Ralph also said, If it's 70% there, the other 30% is the slightly slower in terms of the actual sales movement that we've had, new bookings. That was the other portion of that reduction that we thought was appropriate to make sure that we were honest about that and make sure we're giving you numbers that we can hit.

Got it. Appreciate the questions.

Thank you. Our next question comes from Eric Martinuzzi with Lake Street. please proceed with your question.

Yeah, it looks like you were pretty aggressive on the workforce optimization. Can you quantify the number of heads or the percentage reduction that you, the steps you took at the beginning of Q2?

Sure. This is Alan and Ralph, if you could add, are correct. There were about 28 people that we took a look at in terms of what things that we had to change. And I think that was appropriate for us to do, but not just personnel. I think ultimately we also had some changes in terms of some marketing plans and programs and some other expense reductions that we knew we could achieve.

Gotcha. And then earlier in the year there was an activist effort by a pretty substantial shareholder. It was around the topic of a change in board seats, and I don't know what other discussions were held, but I was just wondering if there's any update there. We're now declining revenues for three of the last four quarters. Have things like strategic alternatives been discussed besides board changes and other actions that this activist might have entertained?

Yeah, this is Ralph. I'll answer that question. So none that we would be talking about publicly at this point in time. But I would say that everyone is keenly focused on working with the senior leadership team to get this train back on the track and being a kind of growth and profitability story. So there's a lot of work to do, and everyone's committed to getting it done.

Is there another question there?

Thank you. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 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. We ask that you please limit yourself to one question and one follow-up. Thank you. Our next question comes from Jeremy Hamblin with Craig Hallam. Please proceed with your question.

Thanks for taking the question. So you noted that sales cycles have become elongated, and I wanted to get your assessment in terms of there's been quite a bit of noise around um tools similar to shot spotter you know i know there was a uh you know on the john oliver show last week tonight they had a a segment the other week um that really was about alprs but it did include shot spotter in there um and some of the pushback communities have had on these things. Do you feel like the environment is creating the sales cycles as much as, you know, things like ARPA funding and so forth? Or, you know, how do you assess that? I mean, you've been at it for, you know, well over a decade. But how would you compare? You've always had political pushback from elements out there. But how does that compare today? And do you think that that is impacting some of the sales cycle.

Yeah, thanks for that question, Jeremy. And this is Ralph. And I think on a qualitative basis, we're definitely feeling a different type of scrutiny that we hadn't really felt before. We obviously listen in on a lot of city council meetings on renewals as well as kind of new opportunities. And I think the Cambridge one is actually pretty instructive in terms of, like, who's showing up and what their messaging is. And unfortunately, we're finding that we're kind of getting wrapped up in the kind of ALPR debate and controversy that's going on. We're kind of getting wrapped into that. That was really what the John Oliver story was about. His attack really was on automated license plate reader technology. And then we just kind of got swept in there as a part of the overall kind of Uber surveillance thing, inappropriately, by the way, from our point of view. We're also seeing, frankly, that people are trying to tie us to immigration enforcement, which is really quite interesting. If you listen in on a number of these city council meetings, again, I'll just kind of go back to Cambridge. A large part of the attack vector was really about sending police into these communities where potentially their vulnerable populations could be at risk from a deportation, immigration enforcement point of view, which is kind of an interesting line of attack. But, you know, I guess the the the opposition to law enforcement doing their job, they'll take any kind of tool or vector available to them to kind of help make their help make their case. So it's definitely having an impact. We're trying to address that by being not not completely 100 percent law enforcement centric, but kind of fanning out and making sure that we have strong city council support, educating city council members and the like. We have a whole community engagement team on our customer success organization that's doing some really phenomenal work directly engaging the community in different nonprofit organizations that are all kind of built around violence prevention and getting them on side with us. We're doing a lot of work with civil rights organizations and the like. And so we're seeing some good progress. We're having some really good conversations, but it's definitely stretching out the process because it's, you know, it's politically charged to make a decision to, you know, go forward with shot spotter or CUSA gunshot detection. And now we're seeing the counter where there are some consequences with making a decision not to go for it because the impact is real. And unfortunately, we saw that in the case of Mr. Xavier Batista.

Thanks for that, Culler. So I wanted to ask a question, I think, for Alan here. In terms of your adjusted EBITDA guide for the year, I wanted to get a sense for the range that you were including for stock-based comp for this year. And then what would your, you know, obviously you're not hitting your initial targets. I don't know how much that's impacting your SBC, but what would your normalize or what was your kind of start of year target? What are those two differences, numbers?

Yeah, thank you for that question, Jeremy. And I think it's important for us to, if we just think and take a look at our stock-based comp, Q2 of 25 was $3.8 million, right? Q2 of 26 was only $2.4 million. So we reduced that by $1.4 million. So our stock-based comp is going down for the year. We expect it to be certainly lower than we had in 25. So I think that's one of the things that is important. I think the other thing you should look at is our revenue was basically flat from Q1 to Q2, and yet our adjusted EBITDA improved by $1.3 million. Realizing that our allocations of the expense reductions didn't start until Q2, you can see that that already increased that, even with revenue being flat, by $1.3 million. So we do expect that our stock-based comp is probably going to be about $10.4 million for the year, significantly lower than last year. And I would also say that as our revenue does go up, and in order for us to hit that guidance, it has to go up from the 48 to closer to the 52. That adds $4 million. Most of that's going to be flowing down to the bottom line. So that increases it, as well as the cost reductions that we've had. So we feel pretty confident about how we're going to get to that percentage for adjusted EBITDA.

This now concludes our question and answer session. I would like to turn the floor back over to Ralph for closing comments.

Great. Thank you very much. So let me close where I began, and that's really with accountability. This certainly wasn't the core that we wanted at the top line and certainly not what we expected in the second half. And we're not going to pretend otherwise. But on the good news front, the Accord has turned profitable on a leaner base. Our renewal and retention walled its health firm, and we did win our fourth statewide crime tracer deal. And all of this was accomplished on top of a leaner, more profitable company. We believe we've reset the number to something that we can meet and possibly beat. And I'd ask you to measure our progress based on getting to those numbers. And most importantly, let's not lose thread of why we do this. Every renewal, every city, every hospital lane that's in a place where someone is feeling safer because of what we build, we know that we're making a difference. And so I want to thank our team for all the work that they do and also thank all of you for your support. And with that, I think we'll conclude the call.

Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines and have a wonderful day.