Founder, BWS Financial Inc

Hamed Khorsand

Founder

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BWS Financial Inc

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Equity Bottom-Up

<ul>
<li>ARLO continues to add subscribers on a regular basis with annualized recurring revenue reaching $241.6 million in the third quarter of 2024.  </li>
<li>ARLO reported Q3 revenue of $137.7 million compared to our estimate of $132.1 million. The results were mostly in line with our estimates with the sequential increase in subscription revenue.  </li>
<li>The growth trajectory has been fueled by ARLO selling hardware at a very low gross margin. This strategy has worked with ARPU rising sequentially and likely to increase further. </li>
</ul>


ARLO continues to add subscribers on a regular basis with annualized recurring revenue reaching $241.6 million in the third quarter of 2024.  
ARLO reported Q3 revenue of $137.7 million compared to our estimate of $132.1 million. The results were mostly in line with our estimates with the sequential increase in subscription revenue.  
The growth trajectory has been fueled by ARLO selling hardware at a very low gross margin. This strategy has worked with ARPU rising sequentially and likely to increase further. 


ARLO: Services ARPU Drives Free Cash Flow

<ul>
<li>ARLO continues to operate within an industry that is highly price sensitive and dependent on the consumer signing up for paid service. </li>
<li>We are lowering our third quarter hardware revenue to reflect the lower pricing environment. ARLO is not a hardware story. The Company placing hardware units leads to paid service subscribers.</li>
<li>ARLO’s stock has been under pressure since reporting second quarter results most likely to do with concerns over actual number of quarterly retail subscriber adds</li>
</ul>


ARLO continues to operate within an industry that is highly price sensitive and dependent on the consumer signing up for paid service. 
We are lowering our third quarter hardware revenue to reflect the lower pricing environment. ARLO is not a hardware story. The Company placing hardware units leads to paid service subscribers.
ARLO’s stock has been under pressure since reporting second quarter results most likely to do with concerns over actual number of quarterly retail subscriber adds


<ul>
<li>ARLO reported second quarter results after having previously disclosed crossing 4 million paid accounts in July.</li>
<li>Expectations for promotional programs in the second half of the year should help boost total subscribers and fuel service revenue growth</li>
<li>ARLO’s focus on driving service revenue using low price points on hardware has helped maintain a growing base of paid retail accounts</li>
</ul>


ARLO reported second quarter results after having previously disclosed crossing 4 million paid accounts in July.
Expectations for promotional programs in the second half of the year should help boost total subscribers and fuel service revenue growth
ARLO’s focus on driving service revenue using low price points on hardware has helped maintain a growing base of paid retail accounts


ARLO: Retail Growth Sets Course for Revenue Lift

<ul>
<li>ARLO announced it had reached 4 million paid accounts approximately four months after achieving 3 million paid accounts. </li>
<li>The pace of growth is most likely the result of catch-up calculations related to Verisure. However, this should not take away from the magnitude of increase in the number.</li>
<li>The higher baseline of subscriber numbers should change the annualized recurring revenue (“ARR”) for ARLO compared to the end of the first quarter.  </li>
</ul>


ARLO announced it had reached 4 million paid accounts approximately four months after achieving 3 million paid accounts. 
The pace of growth is most likely the result of catch-up calculations related to Verisure. However, this should not take away from the magnitude of increase in the number.
The higher baseline of subscriber numbers should change the annualized recurring revenue (“ARR”) for ARLO compared to the end of the first quarter.  


External reports (aggregated public sources), Value Investors Club

Value Investors Club

External reports (aggregated public sources)

<ul><li>Anticipate significant downward revision in Arlo Technologies' long-term revenue guidance</li><li>Management's lack of transparency regarding key performance indicators may have misled investors</li><li>Initiate a short position before Feb. 29th guidance update to benefit from potential share price decline.</li></ul><p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.</em></p>

Anticipate significant downward revision in Arlo Technologies' long-term revenue guidanceManagement's lack of transparency regarding key performance indicators may have misled investorsInitiate a short position before Feb. 29th guidance update to benefit from potential share price decline.This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Arlo Technologies Inc (ARLO) - Wednesday, Feb 28, 2024

United States

Arlo Technologies, Inc. provides software solutions. The Company offers cloud-based platform with a variety of connected devices such as security cameras. Arlo Technologies serves customers in the United States.

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Arlo Technologies Inc (ARLO US)

ARLO: Services ARPU Drives Free Cash Flow

The negative reaction in the stock price seems focused on hardware prices declining as ARLO moves to a nearly zero gross margin strategy to drive...

BWS Financial Inc

ARLO: Subscriber Adds to Drive ARPU Up

We are anticipating further growth in the number of retail subscribers in the third quarter with ARPU beginning to rise in the fourth quarter as...

BWS Financial Inc

ARLO: Retail Growth Sets Course for Revenue Lift

ARLO is focusing on 2H24 promotions to drive growth during its peak selling period. Paid retail accounts continue to grow and should have greater...

BWS Financial Inc

ARLO: Accelerated Pace of Growth

ARLO reached 4 million paid accounts. This is an accelerated pace from when ARLO reached 3 million paid accounts at the end of February. We are now...

BWS Financial Inc

Arlo Technologies Inc (ARLO) - Wednesday, Feb 28, 2024

Anticipate significant downward revision in Arlo Technologies' long-term revenue guidance. Management's lack of transparency regarding key...

Value Investors Club

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