His father tutored him in mathematics, and following the family's return to the United States, Stone attended Columbia Grammar & Preparatory School in New York City, after which he studied civil engineering for two years at the Columbia University School of Mines,[3] followed by two years at Johns Hopkins University, where he studied mathematics, physics and theoretical and applied electricity.

While there, drawing on the work of Oliver Heaviside, he made a rigorous mathematical analysis of the company's development of a long-distance telephone link between New York and Chicago.

In late 1900, the Stone Wireless Telegraphy Syndicate was started in Boston, with an initial funding of $10,000, to do experimental work in devising a commercial system.

Stone used his knowledge of electrical tuning to develop a "high selectivity" approach to reduce the amount of interference caused by static and signals from other stations.

Starting with Tesla-style open-core electrical transformers, he developed adjustable "selective four-circuit tuning" that employed "loose coupling" to help insure that the transmitter and receiver were operating on a single common frequency.

Stone acted as Chief Engineer, and two stations separated by sixteen kilometers (ten miles) were constructed at Cambridge and Lynn, Massachusetts.

[6] The company's first commercial radiotelegraph link was between the Isle of Shoals and Portsmouth, New Hampshire, which operated during the summer of 1905, replacing a failed Western Union telegraph cable.

In 1906 the company tested a ship-borne "direction-finder" designed by Stone that, although fairly accurate, proved impractical as it required the entire ship to turn in order to take readings.

In 1912, he acted as an intermediary, making arrangements for Lee DeForest to demonstrate an early version of his three-electrode audion vacuum-tube to AT&T engineers, who re-engineered the device into an amplifier that was capable of establishing transcontinental telephone service.