Latest news with #RoyVanKeulen
News.com.au
18-05-2025
- Business
- News.com.au
Hot Money Monday: Life360 rockets 25pc in a week, but is the market dreaming too big?
Life360 pops 25% on record results Ad biz gets love, but maybe too much Morningstar analyst says hype might be running too hot It's been a bonza week for Life360 (ASX:360) investors. The San Francisco-based family safety tech company shot up more than 25% last week, riding a wave of bullish sentiment after posting record-breaking March quarter results. For a business once known as a simple family locator app born out of the post-Hurricane Katrina chaos, this is quite the victory lap. The company, now trading on both the NASDAQ and ASX and capped at $4.5bn, has morphed into a global digital concierge for family life. It does location tracking, crash alerts, pet monitoring, teen driver stats, and more. In the last quarter just reported, it added 4.1 million new users, bringing total monthly active users to a whopping 83.7 million across 170 countries. Not bad for a business that started with the humble goal of helping families stay connected during emergencies. Quarterly revenue surged 32% to US$103.6 million, with subscription income up 37%. But what really turned heads was the near doubling of 'Other Revenue,' which includes its budding advertising business. It came in at $12.8 million for the quarter, up from $6.5 million in the same period a year ago. That's what really sparked the rally, but not everyone's convinced it will last. Getting carried away? Morningstar analyst Roy Van Keulen, who's been keeping a close eye on Life360's numbers, welcomed the strong start but poured a bit of cold water on the hype. That ad growth is exciting, sure, but Van Keulen sees warning lights flickering beneath the surface. His team had already penciled in a long-term drop in App Store commission fees after recent US rulings against Apple's stranglehold on payment systems. And that's a big win for app developers like Life360, whose Apple-related fees have been a major cost line. Still, Van Keulen thinks the Street's getting a little carried away. "Life360 screens as materially overvalued now, as the market appears to be overestimating the advertising growth opportunity," he said. Put simply, the ad dream might not match reality. Ads not quite hitting the mark Yes, Life360's pitch is that it can serve up super-relevant, location-based ads. Imagine landing at LAX airport and instantly seeing a pop-up offer for an Uber ride. That's useful. But how often does that happen? 'We believe the market is overly excited by advertising revenue growth,' Van Keulen said. 'The company's pitch to investors and advertisers is it is uniquely capable of providing contextually relevant advertising inventory in its app, especially for location-relevant ads. "However, we see few relevant use cases for this type of data.' Van Keulen reckons that while some travel-related ads might stick, most of the time, they'll just be white noise. A café promo popping up on your kid's safety app? Not exactly a sure-fire conversion. More critically, he adds, 'We are yet to see growth from targeted ads show up in revenue." "While year-on-year 'other revenue' grew impressively, there was a sequential decline, despite targeted ads being ramped up.' So why the investor euphoria? Part of it comes down to confidence from the top. CEO Chris Hulls is talking up Life360 as an everyday essential in uncertain times. 'In a more cautious consumer spending environment, our performance reflects both the resilience of our business model and the growing demand for our services that keep families safe, connected, and provide peace of mind,' Hulls said in the company's earnings release. Still, Van Keulen has his feet planted on the ground. Even with upgraded forecasts, Morningstar doesn't see Life360's advertising business becoming a reliable money spinner anytime soon. 'Our forecasts assume Life360's average advertising revenue per monthly active user, or MAU, will remain near the bottom end of the range compared with a peer group of consumer apps.' What's the takeaway? Life360's core business – subscriptions that help keep families connected and safe – is in top shape. It's proving resilient, sticky, and nicely profitable. But don't get too starry-eyed about the advertising side just yet. "These use cases are niche and not everyday use cases where targeted ads can deliver a lot of revenue," Van Keulen said. The stock may have sprinted ahead of itself, he added.
Yahoo
14-02-2025
- Business
- Yahoo
Exchange operator ASX posts rise in new listings and capital growth, shares jump
By Rishav Chatterjee (Reuters) -Australian exchange operator ASX said on Thursday it had recorded higher new listings and total quoted capital in the first half and flagged the momentum was continuing into the second half, leading shares to close 5% higher. ASX said its operating revenue reached a record high for the six months ended December 31, reflecting a lift in demand for derivatives market data, rising listing fees and higher trading in the cash market. ASX shares surged as much as 9.2% during trading, the biggest intraday rise in nearly five years. It reported a 10.1% rise in first-half underlying net profit to A$253.7 million ($159.70 million), beating consensus estimates by 2.8% and said it would pay an interim dividend of A$1.112 a share. ASX said increased trading in the Australian market was on the back of changing expectations for global interest rates that coupled with major geopolitical disturbances drove volatility in markets. Initial public offerings also increased in the Australian market, rising to $2.01 billion of net proceeds in 2024, the highest level since 2021, according to LSEG data. ASX has faced headwinds from regulatory scrutiny due to its inability so far to replace its CHESS clearing and settlement system, after an outage in December. The exchange operator said it was planning the first industry test environment for the first release of the new CHESS's clearing services to open later this month. Costs associated with the failed CHESS replacement have been one of the major investor concerns about the company. ASX reported total expenses of A$220.3 million in the first half, which was flat compared to the prior year. It also reaffirmed its expense growth guidance of between 6% and 9% for the current financial year. "The exchange showed the first signs of stabilization in cost growth, an issue since the botched replacement project for its clearing system," said Roy Van Keulen, an analyst at Morningstar. ($1 = 1.5886 Australian dollars) Sign in to access your portfolio
Reuters
13-02-2025
- Business
- Reuters
Exchange operator ASX posts rise in new listings and capital growth, shares jump
Feb 13 (Reuters) - Australian exchange operator ASX ( opens new tab said on Thursday it had recorded higher new listings and total quoted capital in the first half and flagged the momentum was continuing into the second half, leading shares to close 5% higher. ASX said its operating revenue reached a record high for the six months ended December 31, reflecting a lift in demand for derivatives market data, rising listing fees and higher trading in the cash market. ASX shares surged as much as 9.2% during trading, the biggest intraday rise in nearly five years. It reported a 10.1% rise in first-half underlying net profit to A$253.7 million ($159.70 million), beating consensus estimates by 2.8% and said it would pay an interim dividend of A$1.112 a share. ASX said increased trading in the Australian market was on the back of changing expectations for global interest rates that coupled with major geopolitical disturbances drove volatility in markets. Initial public offerings also increased in the Australian market, rising to $2.01 billion of net proceeds in 2024, the highest level since 2021, according to LSEG data. ASX has faced headwinds from regulatory scrutiny due to its inability so far to replace its CHESS clearing and settlement system, after an outage in December. The exchange operator said it was planning the first industry test environment for the first release of the new CHESS's clearing services to open later this month. Costs associated with the failed CHESS replacement have been one of the major investor concerns about the company. ASX reported total expenses of A$220.3 million in the first half, which was flat compared to the prior year. It also reaffirmed its expense growth guidance of between 6% and 9% for the current financial year. "The exchange showed the first signs of stabilization in cost growth, an issue since the botched replacement project for its clearing system," said Roy Van Keulen, an analyst at Morningstar.
