Founder, BWS Financial Inc

Hamed Khorsand

Founder

Independent Stock Specific Research

BWS Financial Inc

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Equity Bottom-Up

<ul>
<li>ARLO continued to grow the number of paid subscribers as consumers see the benefits of having an alert for their installed security cameras</li>
<li>ARLO reported a positive net income for the second straight quarter just as the firm is getting ready to launch a new brand awareness campaign in 2H22</li>
<li>ARLO reiterated its plans to increase marketing expense in the second half of 2022 to accelerate growth in 2023</li>
</ul>


ARLO continued to grow the number of paid subscribers as consumers see the benefits of having an alert for their installed security cameras
ARLO reported a positive net income for the second straight quarter just as the firm is getting ready to launch a new brand awareness campaign in 2H22
ARLO reiterated its plans to increase marketing expense in the second half of 2022 to accelerate growth in 2023


<ul>
<li>ARLO has proven its service business model can be profitable and is now planning to invest more in growth initiatives to drive market share gains to add paid subscribers faster</li>
<li>The faster than expected pace has given ARLO the means to strategically invest in its business to accelerate its service revenue. </li>
<li>Looking ahead to the end of 2022, ARLO could be on the cusp of nearly 2 million paid subscribers before realizing the benefits of the increased marketing</li>
</ul>


ARLO has proven its service business model can be profitable and is now planning to invest more in growth initiatives to drive market share gains to add paid subscribers faster
The faster than expected pace has given ARLO the means to strategically invest in its business to accelerate its service revenue. 
Looking ahead to the end of 2022, ARLO could be on the cusp of nearly 2 million paid subscribers before realizing the benefits of the increased marketing


ARLO: Accelerating Growth Story, PT to $15

<ul>
<li>ARLO reached 1 million paid subscribers at a quicker than expected rate. ARLO had projected it would obtain the milestone by March 2022</li>
<li>We believe the current trajectory of paid subscribers puts ARLO on pace to surpass expectations for the fourth quarter and 2022</li>
<li>We believe reaching 1 million paid subscribers is a bigger event than the stock price reflects, and investors should be using this as a buying opportunity.</li>
</ul>


ARLO reached 1 million paid subscribers at a quicker than expected rate. ARLO had projected it would obtain the milestone by March 2022
We believe the current trajectory of paid subscribers puts ARLO on pace to surpass expectations for the fourth quarter and 2022
We believe reaching 1 million paid subscribers is a bigger event than the stock price reflects, and investors should be using this as a buying opportunity.


<ul>
<li>ARLO inched closer to achieving $100 million in service revenue this year after adding 182 thousand paid subscribers</li>
<li>The pace of paid subscriber growth in the third quarter leads us to expect ARLO reaching 1 million paid subscribers in the fourth quarter of 2021</li>
<li>The Company’s third quarter results were ahead of expectations even though ARLO was constrained by supply chain bottlenecks</li>
</ul>


ARLO inched closer to achieving $100 million in service revenue this year after adding 182 thousand paid subscribers
The pace of paid subscriber growth in the third quarter leads us to expect ARLO reaching 1 million paid subscribers in the fourth quarter of 2021
The Company’s third quarter results were ahead of expectations even though ARLO was constrained by supply chain bottlenecks


ARLO: Inflection Point to Profitability, PT to $12

• Arlo Technologies (ARLO) experienced an acceleration in its paid subscription service in the second quarter to help push the quarter above expectations. • ARLO introduced Arlo Secure in July 2021 as a replacement for Arlo Smart. The new service program leverages ARLO’s artificial intelligence development and offers an unlimited devices subscription plan. • ARLO’s second quarter revenue reached $98.6 million of which $25.3 million was from services. European revenue facilitated the increase in product revenue in the quarter. ARLO is anticipating its Verisure exclusive camera to roll out later this year with full production benefit in 2022. • The continued increase in subscriber count and launch of a polished service offering gives ARLO a pathway to profitability in 2022. The fourth quarter could become an inflection point in the business as paid users reaches 1 million, which would provide annualized revenue of approximately $100 million.

• Arlo Technologies (ARLO) experienced an acceleration in its paid subscription service in the second quarter to help push the quarter above expectations. • ARLO introduced Arlo Secure in July 2021 as a replacement for Arlo Smart. The new service program leverages ARLO’s artificial intelligence development and offers an unlimited devices subscription plan. • ARLO’s second quarter revenue reached $98.6 million of which $25.3 million was from services. European revenue facilitated the increase in product revenue in the quarter. ARLO is anticipating its Verisure exclusive camera to roll out later this year with full production benefit in 2022. • The continued increase in subscriber count and launch of a polished service offering gives ARLO a pathway to profitability in 2022. The fourth quarter could become an inflection point in the business as paid users reaches 1 million, which would provide annualized revenue of approximately $100 million. 

United States

Arlo Technologies, Inc. provides software solutions. The Company offers cloud-based platform with a variety of connected devices such as security cameras. Arlo Technologies serves customers in the United States.

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Arlo Technologies Inc (ARLO US)

ARLO: Prepping for Acceleration

Paid subscriber count accelerated in Q1 after a successful Q4. The growth in paid subscribers should enable greater free cash flow, especially as...

BWS Financial Inc

ARLO: Accelerating Growth Story, PT to $15

ARLO reported a net profit in Q4 proving the service first business model can be profitable. Now, management intends to increase more into the...

BWS Financial Inc

ARLO: 1 Million Paid Subs Achieved

ARLO reached 1 million paid subscribers faster than expected. The rate of net additions in the quarter is ahead of the pace in the third quarter,...

BWS Financial Inc

ARLO: Inflection Point to Profitability, PT to $12

Our price target is now $12 from $10 after ARLO posted better than expected Q3 results on the heels of accelerated paid subscriber growth. ARLO...

BWS Financial Inc

ARLO: Captured Growth

Services continues to grow at a faster than expected rate with net adds rising sequentially. ARLO is expected to experience further ramp in net...

BWS Financial Inc

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