Arlo(US:ARLO)2025-11-06 21:29Revenue Growth - Annual recurring revenue (ARR) reached $323 million, representing a year-over-year growth of 33.8%[1] - Subscriptions and services revenue hit a record of approximately $80 million, increasing by 29.2% year over year, accounting for 57.3% of total revenues[4] - Total revenue for the three months ended September 28, 2025, was $139.5 million, a 7.3% increase from $129.4 million in the previous quarter[25] - Subscription and services revenue reached $79.9 million, up 2.2% from $78.2 million in the previous quarter, while product revenue increased by 16.3% to $59.6 million[25] - For the nine months ended September 28, 2025, total revenue was $388,000,000, a slight decrease from $389,314,000 in the same period last year[38] Profitability Metrics - Record GAAP subscriptions and services gross margin of 84.5%, and non-GAAP subscriptions and services gross margin of 85.1%, up 780 and 770 basis points year over year, respectively[4] - Adjusted EBITDA was $17.1 million, reflecting a year-over-year increase of 50.3%, with an adjusted EBITDA margin of 12.2%[4] - GAAP earnings per share (EPS) reached a record of $0.07, while non-GAAP EPS was $0.16[4] - Net income for the three months ended September 28, 2025, was $6.9 million, compared to a net income of $3.1 million in the previous quarter[25] - Free cash flow for the three months ended September 28, 2025, was $14,984,000, compared to $5,855,000 in the prior quarter, representing a significant increase of 155.5%[31] Cash and Investments - The company ended the quarter with cash and cash equivalents and short-term investments totaling $165.5 million, an increase of $19.0 million year over year[4] - Cash and cash equivalents increased to $86.0 million as of September 28, 2025, from $82.0 million at the end of the previous quarter[23] - The company reported a net cash provided by operating activities of $59.0 million for the nine months ended September 28, 2025, compared to $44.6 million for the same period last year[27] Customer Growth - Cumulative paid accounts grew to 5.4 million, marking a 27.4% increase year over year[4] - Cumulative registered accounts increased to 11,792 as of September 28, 2025, compared to 11,237 in the previous quarter, reflecting a growth of 4.9%[34] - Cumulative paid accounts rose to 5,396 as of September 28, 2025, from 5,115 in the previous quarter, indicating an increase of 5.5%[35] Regional Revenue Breakdown - Revenue from the Americas was $83,831,000, accounting for 60.1% of total revenue, up from 53.2% in the same quarter last year[38] - EMEA revenue reached $49,602,000, making up 35.5% of total revenue, compared to 33.5% in the previous year[38] - APAC revenue was $6,096,000, representing 4.4% of total revenue, slightly up from 4.2% in the same quarter last year[38] - The Americas region showed significant growth with a nine-month revenue of $235,830,000, up from $195,766,000, increasing its share from 50.3% to 60.8%[38] - EMEA's nine-month revenue was $135,817,000, which is a decrease from $175,980,000, reducing its share from 45.2% to 35.0%[38] Future Outlook - The company expects fourth quarter 2025 revenue to be between $131 million and $141 million, with non-GAAP net income per share projected between $0.13 and $0.19[6] - The comprehensive launch of the refreshed product portfolio and the Arlo Secure 6 AI-driven security platform is anticipated to drive additional subscriptions and services revenue growth heading into 2026[3] - The company continues to focus on expanding its market presence, particularly in the Americas, which has shown the most robust growth[38] - Future outlook indicates a strategic emphasis on enhancing product offerings and technological advancements to drive revenue growth[38]