Arlo Technologies (NYSE:ARLO) Posts Earnings Results, Beats Estimates By $0.04 EPS

Arlo Technologies (NYSE:ARLO) announced its earnings results on Thursday. The company reported $0.24 EPS for the quarter, beating analysts’ consensus estimates of $0.20 by $0.04, FiscalAI reports. The company had revenue of $149.18 million during the quarter, compared to analysts’ expectations of $144.93 million. Arlo Technologies had a return on equity of 17.29% and a net margin of 5.20%. Arlo Technologies’s revenue for the quarter was up 6.9% on a year-over-year basis. During the same period last year, the business posted $0.16 EPS.

Here are the key takeaways from Arlo Technologies’ conference call:

• Subscriptions and services revenue rose 20% to $96 million, while paid accounts grew 23% to 6.6 million and ARR increased 14% to $370 million. Higher recurring-revenue mix helped lift non-GAAP gross margin by 760 basis points and adjusted EBITDA by 58% year over year.
• Management is targeting roughly 30% ARR growth in 2027, citing strategic-account expansion, Arlo Secure 7 and Aloe Care. It expects higher subscription tiers and increased service revenue per partner subscriber to help drive growth.
• Comcast integration remains on schedule for a mid-2027 launch and could become Arlo’s largest strategic partnership; ADT is also expanding its DIY offering. Management cautioned that new partnerships under discussion are more likely to contribute meaningfully in 2028.
• Fourth-quarter revenue guidance of $137 million to $147 million and non-GAAP EPS of $0.17 to $0.23 are below Q3’s $149.2 million and $0.24, respectively. Management expects subscriptions and services to make up more than 70% of Q4 revenue.
• Arlo reported gains in retail shelf space and multi-camera kit sales, which management says tend to generate more subscription sign-ups; multi-camera kit units rose 41% year over year during Amazon’s Prime event. The company also said early demand for its new solar camera is strong.

Arlo Technologies Stock Performance

Shares of ARLO stock traded down $2.25 during trading hours on Friday, hitting $12.59. 1,585,877 shares of the company were exchanged, compared to its average volume of 1,423,083. The stock has a market capitalization of $1.37 billion, a price-to-earnings ratio of 46.76 and a beta of 1.59. Arlo Technologies has a one year low of $11.05 and a one year high of $16.89. The business’s 50-day simple moving average is $13.07 and its two-hundred day simple moving average is $13.39.

Insider Transactions at Arlo Technologies

In other Arlo Technologies news, CFO Kurtis Binder sold 33,394 shares of the business’s stock in a transaction dated Wednesday, November 4th. The shares were sold at an average price of $15.03, for a total transaction of $501,911.82. Following the sale, the chief financial officer directly owned 312,147 shares in the company, valued at approximately $4,691,569.41. The trade was a 9.66% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 129,963 shares of company stock valued at $1,705,100 in the last quarter. Company insiders own 2.90% of the company’s stock.

Wall Street Analyst Weigh In

A number of brokerages have recently issued reports on ARLO. Wall Street Zen lowered shares of Arlo Technologies from a “strong-buy” rating to a “buy” rating in a research note on Saturday, October 31st. Weiss Ratings reissued a “hold (c-)” rating on shares of Arlo Technologies in a research note on Friday, October 30th. Finally, Piper Sandler reissued an “overweight” rating and issued a $17.00 price objective (up from $16.00) on shares of Arlo Technologies in a research report on Friday. Five investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. According to MarketBeat, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $20.40.

More Arlo Technologies News

Here are the key news stories impacting Arlo Technologies this week:

• Positive Sentiment: Piper Sandler reaffirmed its “overweight” rating and raised its price target to $17 from $16, implying about 32% upside from the cited $12.85 share price. Piper Sandler rating and target
• Positive Sentiment: Q3 adjusted EPS of $0.24 beat the $0.20 consensus, while revenue of $149.18 million topped estimates of $144.93 million and rose 6.9% year over year. Management also cited 20% growth in subscriptions and services revenue and adjusted EBITDA growth of more than 50%. Arlo Q3 results
• Neutral Sentiment: CFO Kurtis Binder sold 33,394 shares through a pre-arranged Rule 10b5-1 plan and retained 312,147 shares. The planned nature of the transaction makes it less conclusive as a signal about his view of the stock. SEC filing
• Negative Sentiment: Q4 guidance calls for revenue of $137 million–$147 million, below Q3’s $149.18 million, and adjusted EPS of $0.17–$0.23. The sequential revenue decline may be overshadowing the quarterly beat and strong recurring-revenue growth. Q4 revenue guidance

Arlo Technologies Company Profile

Arlo Technologies, Inc is a smart home security company that develops connected devices and cloud-based services designed to help consumers monitor and protect their homes, businesses and other properties. Its product portfolio includes wire-free and wired security cameras, video doorbells, floodlight cameras, home security systems and related accessories.

Arlo’s products typically connect through mobile applications and cloud services, providing features such as live video, motion detection, two-way audio, night vision and notifications.