- The stock price of Arlo Technologies Inc (NYSE: ARLO) is trading at over 20% pre-market This is why it happened.
The stock price of Arlo Technologies Inc (NYSE: ARLO) is trading at over 20% pre-market as of 9:09 AM ET. Investors are responding to the company announcing its fourth-quarter 2020 and full year 2020 results.
Financial Highlights:
– Fourth quarter revenue of $114.8 million, a decrease of 6.2% year over year.
– Fourth quarter GAAP gross profit of $24.5 million, an increase of 79% year over year; non-GAAP gross profit of $25.7 million, an increase of 73% year over year.
– Fourth quarter GAAP gross margin of 21.4%; non-GAAP gross margin of 22.4%.
– Fourth quarter GAAP net loss per diluted share of $(0.19); non-GAAP net loss per diluted share of $(0.08).
– 2020 revenue of $357.2 million, a decrease of 3.5% compared to prior year.
– 2020 GAAP gross profit of $55.4 million, an increase of 54.7% compared to prior year; non-GAAP gross profit of $59.7 million, an increase of 51.5% compared to prior year.
– 2020 GAAP gross margin of 15.5%; non-GAAP gross margin of 16.7%.
– 2020 GAAP net loss per diluted share of $(1.30); non-GAAP net loss per diluted share of $(0.82).
– Cash, cash equivalents and short-term investments of $206.1 million and no debt at the end of Q4.
Business Highlights
– Full year service revenue of $72.3 million, for growth of 54.6% year over year.
– Service revenue of $21.6 million for Q4, for growth of 72.1% year over year.
– Added a record 79,000 paid accounts in Q4, a sequential increase of 22.2% over Q3, and a year over year increase of 89.1%.
– Announced the all new Arlo Touchless Video Doorbell, which builds on the award-winning features of the Video Doorbell. Utilizing our precise Proximity Sensing Technology, the Touchless Video Doorbell can automatically detect a visitor’s approach and “press” the doorbell, alerting both homeowner and visitor without the need for physical contact with the device. The Touchless Video Doorbell also includes a three-month subscription to Arlo Smart.
– Expanded the Arlo Essential product family with the addition of the Essential Indoor Camera, which sports all of the Essential’s great features while incorporating new design elements for optimal indoor use. The Essential Indoor Camera features a stand mount and a power cord for easy and flexible indoor placement, along with a built-in motorized shutter to quickly and easily turn the camera on and off. This Essential Indoor Camera also includes a three-month subscription to Arlo Smart.
– Partnered with Calix and its broad network of Communications Service Providers to seamlessly offer Arlo products and services as part of a homeowner’s overall managed WiFi experience.
– The newly announced Essential Indoor Camera and Touchless Video Doorbell were named CES 2021 Innovation Award Honorees, making this the third consecutive year of recognition for Arlo products by the Consumer Technology Association.
First Quarter 2021 Business Outlook
– Revenue of $70 million to $80 million.
– GAAP net loss per diluted share of $(0.35) to $(0.29), and non-GAAP net loss per diluted share of $(0.23) to $(0.17).
KEY QUOTE:
“2020 was an unprecedented year and I am exceedingly proud of our team’s perseverance and determination in the face of the ongoing pandemic. In Q4, revenue grew 4.2% sequentially to $114.8 million to come in at the top end of our guidance. The strength of our new business model, a free, 90-day trial of Arlo Smart, continues to accelerate the momentum of our paid account growth and the fourth quarter was another great example. We closed out the year with an 89.1% year over year paid account growth and saw service gross margin improve 10 percentage points year over year. Our unwavering commitment to operational efficiency drove a significant year over year decrease in operating expenses and led us to solidly outperform the high end of our guidance for EPS. We also kept our focus on robust innovation and launched two new products in the fourth quarter. In 2020 we laid a solid foundation to become a more profitable and predictable business with strong progress with our Verisure partnership and by refreshing our entire product line up to drive paid account growth with our new business model. Looking forward, we expect to roughly triple our paid account additions in 2021 and reach one million paid accounts by this time next year. We believe Arlo is on solid financial and operational footing and look forward to continuing our execution in 2021.”
— Matthew McRae, Chief Executive Officer of Arlo Technologies
Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.
