Latest news with #ArloSecure6
Yahoo
5 days ago
- Business
- Yahoo
ARLO Q1 Earnings Call: Services Growth Offsets Hardware Declines Amid Tariff Uncertainty
Smart security company Arlo (NYSE:ARLO) reported Q1 CY2025 results topping the market's revenue expectations , but sales fell by 4.1% year on year to $119.1 million. Its non-GAAP profit of $0.15 per share was 28.2% above analysts' consensus estimates. Is now the time to buy ARLO? Find out in our full research report (it's free). Revenue: $119.1 million vs analyst estimates of $118.4 million (4.1% year-on-year decline, 0.6% beat) Adjusted EPS: $0.15 vs analyst estimates of $0.12 (28.2% beat) Adjusted EBITDA: $16.42 million vs analyst estimates of $12.33 million (13.8% margin, 33.1% beat) Operating Margin: -1.2%, up from -8.5% in the same quarter last year Market Capitalization: $1.79 billion Arlo's first quarter results reflected a rapidly expanding subscriptions and services business, which management identified as the main factor driving performance. CEO Matthew McRae highlighted that paid subscriber accounts reached 4.9 million by quarter end, up 51% year over year, with annual recurring revenue surpassing $276 million. The company attributed this momentum to the continued adoption of premium Arlo Secure plans and the simplification of service offerings, which pushed average revenue per user to a record $13.48. COO and CFO Kurt Binder emphasized that this shift toward recurring services revenue underpinned overall profitability, even as hardware revenue declined and product gross margins remained negative. Looking forward, Arlo's leadership expects the services-first approach to remain central to growth, with further ARPU expansion anticipated from the rollout of Arlo Secure 6 and new plan structures. McRae stated, 'We are planning our largest product launch in company history for the holiday season,' which is expected to deliver 20% to 35% cost reductions on new devices and mitigate tariff impacts. Management also outlined an early rollout of advanced AI features, including enhanced audio event detection and search capabilities, to strengthen the value proposition for customers. While tariff changes introduce some uncertainty, the company expects minimal impact on consolidated margins due to the predominance of services revenue. Management attributed the quarter's results to accelerated subscriber growth, increased ARPU, and robust cost discipline, while addressing ongoing challenges in product margins and international markets. Subscription and ARPU growth: Arlo's record services revenue stemmed from accelerated paid subscriber additions and a higher average revenue per user, driven largely by customer migration to premium Arlo Secure plans and recent plan simplification. Product revenue under pressure: Hardware sales remained soft due to industry-wide declines in average selling prices (ASPs), which management described as a deliberate strategy to use devices as a customer acquisition tool rather than a profit center. Negative product gross margins: Promotional pricing and aggressive discounting to remain competitive led to continued negative gross margins in the hardware segment, though combined gross margins improved as services revenue became a larger share of the mix. International segment dynamics: The EMEA region, particularly the Verisure partnership, faced temporary headwinds from inventory destocking, supply chain timing around the Chinese New Year, and regulatory changes such as USB-C standardization, resulting in lower international revenue contributions. Operational discipline and efficiency: Cost controls, especially in R&D spending, contributed to lower operating expenses and record free cash flow, supporting profitability despite the shift in business mix and competitive pressures. Arlo's guidance is shaped by momentum in subscriptions, upcoming product launches, and ongoing efforts to manage tariff-related cost risks and industry pricing trends. Holiday product refresh: The planned launch of over 100 new device SKUs later in the year is expected to achieve 20% to 35% reductions in cost of goods sold and help offset potential tariff increases, while supporting customer acquisition during peak retail periods. Advanced AI feature rollout: Early deployment of Arlo Secure 6 features—including enhanced audio detection and expanded event search—aims to further increase ARPU and subscriber retention as customers shift to higher-value service tiers. Tariff and supply chain risks: Management has modeled for a continuation of the current 10% tariff regime and is closely monitoring potential changes post-July. While most revenue and profit are insulated due to the services mix, hardware cost management and inventory positioning remain key uncertainties. In the coming quarters, the StockStory team will watch (1) the pace of subscriber and ARPU growth as new AI features and Arlo Secure 6 roll out, (2) execution on the upcoming large-scale device refresh and its impact on customer acquisition and margins, and (3) the company's ability to navigate evolving tariff regimes and manage hardware costs. The realization of new strategic partnerships will also be a key marker for sustained growth. Arlo Technologies currently trades at a forward P/E ratio of 27×. At this valuation, is it a buy or sell post earnings? Find out in our full research report (it's free). Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
Engadget
09-05-2025
- Business
- Engadget
Arlo updates its security system to caption what cameras see and detect gunshots
Arlo is expanding the AI features offered in its subscription security service as part of its new Arlo Secure 6 update. The updated system will offer improved video search, give cameras and doorbells a greater ability to identify possible emergency events and automatically create captions for anything your security system records when it starts rolling out later in May. As part of Arlo Secure 6, cameras will not only be able to use object-detection to identify things like packages, but also send you a notification when they visually detect a flame. The list of things devices can detect via sound is also expanding to include gunshots, screams, barking and broken glass, making it easier to know when to call for help. To make it easier to review footage, Arlo is now also using AI to generate captions for the clips your security system captures, that way you don't need to watch everything to know what's going on. And when you need to pull up a specific clip, Arlo Secure 6 will let you search for "specific keywords, descriptions, or time ranges" to find what you're looking for. Both Google and Amazon have explored similar AI-powered features in their Nest Aware and Ring Home services, automatically identify smoke alarms or letting you search for a specific person or thing in video search. This Secure 6 update makes Arlo's service more competitive, while focusing on some specifics that neither Google or Amazon offer. If you're already pay for an Arlo Secure plan, you should get the new Arlo Secure 6 features starting this month. Arlo offers two versions of its Secure subscription, a Plus plan for either $8 per month (one camera) or $18 per month (unlimited cameras), and a Premium plan for $25 per month.
CNET
09-05-2025
- Business
- CNET
Arlo Security System Now Can Alert Customers to Gunshots, Screams, Barking Dogs
Screams. Gunshots. Broken glass. Homeowners hope not to hear any of those, but now new AI features in the Arlo home security subscription service can notify customers of such sounds via email and push notifications. On Thursday, the company announced Arlo Secure 6, the next generation of its security software, which includes alerts for those sounds and others. Arlo Secure 6 also provides a suite of other features, including AI-generated captions to describe events, the ability to search through videos by using keywords or descriptions, and flame detection. Read more: Best Home Security Systems in 2025 The Secure 6 camera alerts subscribers when it detects someone screaming, a dog barking, an intruder smashing glass and gunshots. The new enhancements build off of previously introduced features, including person and vehicle recognition and custom detection. "When your dog barks, you'll be notified so you can view live video to see if your dog is barking at a stranger or just a cat," Arlo said in the release. It's a novel concept, says a CNET staffer. "I've tested advanced Arlo AI in the past, like the ability to train its visual AI on certain objects," said Tyler Lacoma, CNET home security editor. "But this is one of the only services I've seen that can recognize flames or send customized alerts about gunshots and screaming. As home security AI grows more advanced, these features are becoming more common, and Arlo is early to the game." A growing industry Arlo's home security advancements increases its competitiveness in a home-security system industry that appears set to keep growing for at least the next few years, according to a recent report from Grand View Research. The report anticipates an annual global growth rate of a little more than 15 percent from the market size of $33.94 billion in 2024. Read more: I Thought I'd Hate AI in Home Security. It's Just the Opposite Driving the growth are a variety of factors, both societal and technological: growing concerns about safety and security, the user convenience of remote monitoring and control and the continued and seemingly limitless advancements in AI technology, Grand View says. The AI camera market is also booming, thanks in part to the increasing demand for next-gen home security systems. According to a recent report by Transparency Market Research, the AI camera market will grow to an estimated $35.5 billion by the end of 2034 on an annual growth rate of 14 percent. Thanks to rapid and constant improvements in image recognition, facial recognition, object detection, and behavioral analysis, AI cameras are also becoming vital in the security and surveillance, automotive, retail, healthcare, and smart homes industries.
