Financial Data and Key Metrics Changes - Owlet achieved net revenue of $22.1 million in Q3 2024, representing a year-over-year growth of 141% [7][28] - Gross margin increased to 52%, up 1,590 basis points compared to Q3 2023, marking the highest gross margin since going public [7][30] - Adjusted EBITDA for Q3 was $0.6 million, an improvement of $6.1 million year-over-year, indicating the second consecutive quarter of positive adjusted EBITDA [8][32] Business Line Data and Key Metrics Changes - Revenue growth was primarily driven by global sales of Dream Sock and Duo, with Dream Sock achieving a domestic sell-through growth of 55% year-over-year [15][28] - The subscription service launched in beta showed an 85% retention rate after the first month, with approximately 60% of subscribers engaging as daily active users [12][26] Market Data and Key Metrics Changes - International revenue growth was 96% year-over-year, with expansion into nine additional European markets, totaling 26 countries [19][28] - Owlet's market share of total dollars spent on baby monitors increased to approximately 31% in the six months trending September 2024, up from 23% in the same period in 2023 [17] Company Strategy and Development Direction - The company focuses on three strategic areas: driving global adoption of Dream Sock, expanding medical and healthcare channels for BabySat, and transitioning into a subscription service [13][20] - Owlet aims to leverage its extensive health and sleep dataset to enhance the value proposition of its products and increase customer lifetime value [25][52] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the consumer environment, noting continued strong demand for products following FDA and CE Med mark clearances [39] - The company expects to land at the higher end of its 2024 guidance, estimating net revenue of $74 million to $77.5 million [35] Other Important Information - The company completed a follow-on equity offering raising net proceeds of approximately $9.8 million, enhancing its cash position and balance sheet flexibility [33] - A comprehensive debt restructuring was completed, improving the health of the balance sheet and increasing operational flexibility [34] Q&A Session Summary Question: Insights on the state of the consumer environment - Management noted a continued strong consumer environment, with FDA clearance resonating well with customers [39] Question: Manufacturing exposure and potential tariff impacts - Current manufacturing is in China and Thailand, with considerations to move camera manufacturing to Vietnam to minimize tariff exposure [40][41] Question: Path forward for BabySat reimbursement integration - Management is building relationships with DMEs and hospitals to drive reimbursement opportunities for BabySat [43][44] Question: International opportunities for BabySat - The company is focused on expanding the consumer side while exploring international markets, with significant growth potential [45]

Owlet, Inc. Q3 2024 Financial Results November 13, 2024 Owlet, Inc. (NYSE: OWLT) | Q3 2024 Financial Results Conference Call Speakers ● Kurt Workman, Co-Founder and CEO ● Jonathan Harris, President and CRO ● Amanda Twede Crawford, CFO ● Jay Gentzkow, VP Investor Relations Webcast ● Domestic Callers: (833) 470-1428 ● International Callers: (404) 975-4839; Access Code: 626609 ● Webcast Archive Available: investors.owletcare.com Contacts ● Website: investors.owletcare.com ● Email: IR@owletcare.com ● Investor C ...

Financial Performance - Q3 2024 revenue was $22.1 million, a 141% increase from Q3 2023's $9.2 million[3] - Gross margin for Q3 2024 was 52.2%, up 1,590 basis points from 36.3% in Q3 2023[4] - Q3 2024 net loss remained at $(5.6) million, consistent with Q3 2023[6] - Adjusted EBITDA improved to $0.6 million in Q3 2024, a $6.1 million increase from a loss of $5.5 million in Q3 2023[7] - Revenues for the three months ended September 30, 2024, were $22.1 million, a significant increase from $9.2 million in the same period of 2023, reflecting a 140.2% year-over-year growth[28] - Gross profit for the nine months ended September 30, 2024, was $28.3 million, compared to $12.7 million for the same period in 2023, indicating a 122.0% increase[28] - Operating loss narrowed to $4.8 million for the three months ended September 30, 2024, compared to a loss of $7.9 million in the same period of 2023, showing a 39.2% improvement[28] - Net loss attributable to common stockholders for the three months ended September 30, 2024, was $6.8 million, compared to a loss of $7.0 million in the same period of 2023, reflecting a 2.9% improvement[30] - Non-GAAP adjusted net income for the three months ended September 30, 2024, was $0.4 million, compared to a loss of $5.8 million in the same period of 2023, indicating a significant turnaround[31] Expenses and Liabilities - Operating expenses for Q3 2024 were $16.4 million, up from $11.2 million in Q3 2023, primarily due to higher compensation and marketing expenses[5] - Total current liabilities decreased to $35.7 million as of September 30, 2024, from $45.1 million at December 31, 2023, a decline of 20.7%[23] - Total liabilities decreased to $65.5 million as of September 30, 2024, down from $73.8 million at December 31, 2023, a reduction of 11.2%[23] Cash Flow and Assets - Net cash used in operating activities decreased to $14.5 million for the nine months ended September 30, 2024, down from $22.0 million in the same period of 2023, a reduction of 34.1%[25] - Cash and cash equivalents increased to $21.5 million as of September 30, 2024, from $16.6 million at December 31, 2023, a growth of 29.5%[23] - Total assets increased to $56.1 million as of September 30, 2024, up from $44.1 million at December 31, 2023, representing a 27.8% growth[23] Growth Drivers and Future Outlook - The increase in revenue was driven by higher sales of Dream Sock products and a new direct selling arrangement with Amazon[3] - Full year 2024 net revenue is expected to range from $74 million to $77.5 million, with gross margins of 48% to 49%[8] - Owlet aims to capitalize on growth opportunities in core products and the long-term potential of its BabySat medical offering and subscription service[2] - The company recognized a $1.9 million charge for asset impairment related to internally developed software in Q3 2024[6]

Core Viewpoint - Kuehn Law, PLLC is investigating potential breaches of fiduciary duties by certain officers and directors of Owlet, Inc. related to shareholder interests [1]. Group 1: Legal Investigation - A federal securities lawsuit alleges that Owlet insiders misrepresented or failed to disclose critical information regarding the Smart Sock, which the FDA classified as a medical device [2]. - The lawsuit claims that Owlet is likely required to obtain marketing authorization for the Smart Sock and may need to cease its commercial distribution in the U.S. until such approval is obtained [2]. - Positive statements made by Owlet about its business operations and prospects are alleged to be materially misleading and lack a reasonable basis [2]. Group 2: Shareholder Engagement - Long-term OWLT stockholders are encouraged to contact Kuehn Law for a free consultation regarding their rights as shareholders [3]. - The firm emphasizes the importance of shareholder participation in maintaining the integrity and fairness of financial markets [3].

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Owlet, Inc. regarding breaches of fiduciary duties by its board of directors following a class action complaint related to the company's marketing practices and regulatory compliance [1] Company Overview - Owlet, Inc. was formed through a business combination with Sandbridge and Owlet Baby Care Inc. on July 15, 2021, focusing on products that help parents monitor their children's health [2] Regulatory Issues - On October 4, 2021, Owlet disclosed that the FDA issued a warning letter indicating that its Owlet Smart Sock product qualifies as a medical device requiring premarket clearance, which the company has not obtained [3] - The FDA requested that Owlet cease the commercial distribution of the Smart Sock for specific health monitoring uses, which could lead to significant operational and financial implications for the company [3] Market Reaction - Following the FDA warning, Owlet's stock price dropped by $1.29, or 23%, closing at $4.19 per share, with unusually high trading volume [3] - Investors from Sandbridge who could have opposed the business combination and redeemed shares at $10.00 per share experienced a loss of $5.81 per share due to the stock price decline [3]

Financial Performance - Revenues for Q2 2024 reached $20,699,000, a 58% increase from $13,088,000 in Q2 2023[17] - Gross profit for the six months ended June 30, 2024, was $16,799,000, compared to $9,386,000 for the same period in 2023, reflecting a 79% increase[17] - For the six months ended June 30, 2024, Owlet reported a net income of $2,127 thousand, a significant improvement compared to a net loss of $20,334 thousand for the same period in 2023[22] - The net loss attributable to common stockholders for Q2 2024 was $2,682,000, compared to a loss of $9,793,000 in Q2 2023[17] - The company reported a net income of $2,127 thousand for the six months ended June 30, 2024, compared to a net loss of $(22,313) thousand for the same period in 2023[94] - The company recognized a gain of $10.2 million for the six months ended June 30, 2024, compared to a gain of $0.3 million for the same period in the prior year[117] Cash Flow and Liquidity - The company experienced negative cash flows from operations of $6,674 thousand for the six months ended June 30, 2024, compared to $16,757 thousand for the same period in 2023, indicating improved cash management[30] - As of June 30, 2024, Owlet had cash and cash equivalents of $15,363 thousand, down from $24,746 thousand at the end of June 2023[22] - The company reported net cash provided by financing activities of $5.6 million for the six months ended June 30, 2024, down from $30.3 million in the same period of the previous year[147] - For the six months ended June 30, 2024, net cash used in operating activities was $6.7 million, a decrease from $16.8 million in the prior year, primarily due to a lower operating loss of $8.0 million compared to $17.7 million[145] Assets and Liabilities - Total current assets increased to $42,530,000 as of June 30, 2024, up from $39,944,000 at the end of 2023[15] - Current liabilities decreased to $42,150,000 as of June 30, 2024, down from $45,090,000 at the end of 2023[15] - Total liabilities decreased to $66,729,000 as of June 30, 2024, down from $73,799,000 at the end of 2023[15] - The company reported a common stock warrant liability of $24,429,000 as of June 30, 2024, down from $27,781,000 at the end of 2023[15] - As of June 30, 2024, the accumulated deficit of Owlet, Inc. was $253,532 thousand, reflecting ongoing financial challenges[30] Operating Expenses - Total operating expenses for the three months ended June 30, 2024, were $12.5 million, compared to $11.9 million in the same period of 2023[105] - General and administrative expenses for the three months ended June 30, 2024, were $6.3 million, a slight increase of 2.7% from $6.1 million in the same period of 2023[109] - Sales and marketing expenses for the three months ended June 30, 2024, increased by 25.1% to $3.9 million from $3.1 million in the same period of 2023[111] - The company reported an operating loss of $2.2 million for the three months ended June 30, 2024, an improvement from an operating loss of $6.7 million in the same period of 2023[105] Financing Activities - The company raised $9,250 thousand from the issuance of preferred stock and warrants on February 29, 2024, as part of its financing strategy[32] - The company raised aggregate gross proceeds of $30.0 million from a sale of preferred stock and warrants on February 17, 2023[134] - The company entered into amendments with SVB, deferring certain principal payments and extending the maturity of the revolving line of credit to December 31, 2024[135] Regulatory and Compliance - The company received its first medical device marketing authorization with the 510(k) clearance from the FDA for BabySat in June 2023, a prescription use-only pulse oximeter for patients aged over one month and weighing between 6 and 30 pounds[172] - In November 2023, the company obtained de novo classification from the FDA for Dream Sock with Health Notifications, which is now regulated as a medical device[175] - The company is involved in ongoing litigation related to claims of misleading statements regarding the FDA's classification of the Owlet Smart Sock, which could have material adverse effects on its financial condition[171] - The company was notified by NYSE in April 2023 for non-compliance with listing requirements, specifically due to an average global market capitalization and stockholders' equity both being less than $50 million[182] Internal Controls - The company has identified material weaknesses in internal controls over financial reporting, which could lead to misstatements in financial statements[153] - A remediation plan is in place to address identified weaknesses, including hiring additional personnel and implementing new controls[158]

Financial Data and Key Metrics Changes - Owlet achieved $20.7 million in net revenue for Q2 2024, representing a 58% year-over-year increase [22] - Gross billings for Q2 were $26.9 million, up 59% year-over-year [22] - Gross margin for Q2 was approximately 50%, an increase of over 1,000 basis points from the previous year [23] - Adjusted EBITDA for Q2 was $100,000, a significant improvement from an adjusted EBITDA loss of $4.3 million in Q2 2023 [24] Business Line Data and Key Metrics Changes - Sales of Dream Sock products drove revenue growth, reflecting increased consumer demand compared to the same period last year [23] - The launch of the subscription service, Owlet Care, is expected to enhance long-term value for the company [4][7] Market Data and Key Metrics Changes - Owlet's international revenue grew over 275% year-over-year, indicating strong global demand for its products [16] - The company reported a 61% year-over-year increase in units sold and a 68% increase in revenue during the July Amazon Prime event [4] Company Strategy and Development Direction - Owlet is transitioning from a hardware company to a platform for pediatric health, focusing on personalized information for parents [7][9] - The company aims to drive continued adoption of Dream Sock, expand medical and healthcare channels, and enhance its subscription service [11] - Owlet's strategy includes leveraging its large dataset of infant health to provide insights and integrate professional services into its app [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that 2024 will be a turning point for the company, with a focus on sustainable growth and profitability [5][20] - The company anticipates net revenue for the second half of 2024 to be stronger than the first half, estimating between $37 million to $42 million [27] Other Important Information - The company has fully integrated its telehealth partnership with Wheel to facilitate insurance reimbursement [5] - Owlet's management highlighted the importance of addressing parental concerns regarding infant health and safety [6] Q&A Session Summary Question: How is Owlet tracking media exposure and its translation into sales? - Owlet is actively monitoring site traffic and engagement on social media platforms, leveraging a PR agency to expand reach [28] Question: Is Owlet continuing partnerships with nonprofit organizations? - Yes, Owlet continues to collaborate with partners focused on SIDS and other conditions, enhancing awareness among parents [29] Question: What is the expectation for positive adjusted EBITDA moving forward? - The company expects Q3 to be stronger due to holiday season sales, with potential for sequential increases in adjusted EBITDA [30][31] Question: What are the assumptions regarding shipping costs and gross margins? - Shipping costs are expected to impact gross margins, with a focus on managing inventory and shipping methods to mitigate costs [32][33] Question: What is the current return rate as a percentage of gross revenue? - Returns for Q2 were 4.1% of gross billings, significantly below the historical average of around 10% [35] Question: What is the potential for insurance reimbursement for Owlet products? - The company is working on building infrastructure for insurance reimbursement, aiming to position its products as standard home care for infants [38][39] Question: What is the strategy for increasing awareness of the Sock? - Owlet plans to continue achieving key financial milestones and enhance investor awareness through various channels [49][50]

Financial Performance - Q2 2024 revenue was approximately $20.7 million, up approximately 58% year over year from $13.1 million in Q2 2023[2] - Q2 2024 gross margin was approximately 50%, an increase of approximately 1,000 basis points year over year[2] - Q2 2024 net loss improved to approximately ($1.1) million, compared to a net loss of approximately ($8.5) million in Q2 2023, representing an improvement of approximately 85%[2][5] - Adjusted EBITDA for Q2 2024 was approximately $0.1 million, a significant improvement from an adjusted EBITDA loss of approximately ($4.3) million in the same period last year[6] - Total revenues for the three months ended June 30, 2024, were $20.7 million, a 57.5% increase compared to $13.1 million for the same period in 2023[25] - Gross profit for the six months ended June 30, 2024, was $16.8 million, up from $9.4 million in the same period of 2023, representing a 78.7% increase[25] - Operating loss for the three months ended June 30, 2024, improved to $(2.2) million from $(6.7) million in the same period of 2023[25] - Net loss attributable to common stockholders for the six months ended June 30, 2024, was $(0.7) million, compared to $(22.3) million in the same period of 2023[25] - Adjusted EBITDA for the six months ended June 30, 2024, was $(3.0) million, an improvement from $(10.1) million in the same period of 2023[26] - The company reported a net loss per share attributable to common stockholders of $(0.30) for the three months ended June 30, 2024, compared to $(1.19) for the same period in 2023[25] Future Projections - For the second half of 2024, the company estimates net revenue to be in the range of $37 million to $42 million[7] - For FY 2024, the company estimates net revenue to be in the range of $72.5 million to $77.5 million[7] Operating Expenses and Cash Flow - Operating expenses for Q2 2024 were approximately $12.5 million, compared to approximately $11.9 million for the same period in 2023[5] - Net cash used in operating activities for the six months ended June 30, 2024, was $(6.7) million, a significant improvement from $(16.8) million in the same period of 2023[23] - Cash and cash equivalents decreased to $15.4 million as of June 30, 2024, from $16.6 million as of December 31, 2023[21] Assets and Liabilities - Total current assets increased to $42.5 million as of June 30, 2024, compared to $39.9 million as of December 31, 2023[21] - Total liabilities decreased to $66.7 million as of June 30, 2024, down from $73.8 million as of December 31, 2023[21] Market Expansion and Consumer Demand - The company obtained CE Medical certification for the UK and Europe, launching Dream Sock across major European markets[2] - Record-breaking results were achieved during Amazon Prime Day, indicating strong consumer demand[4] - The company plans to continue laying the regulatory groundwork for commercial expansion in both the US and international markets[4]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ____________________________________________________________________________ FORM 10-Q ____________________________________________________________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ t ...

Owlet, Inc. (NYSE:OWLT) Q1 2024 Earnings Conference Call May 6, 2024 4:30 PM ET Company Participants Mike Cavanaugh - IR Kurt Workman - Co-Founder and CEO Kate Scolnick - CFO Jonathan Harris - President and Chief Revenue Officer Conference Call Participants Charles Rhyee - TD Cowen Operator Good afternoon. Thank you for attending the Owlet First Quarter 2024 Earnings Call. My name is Cameron and I will be your moderator for today. [Operator Instructions] And I would now like to pass the conference over to y ...