Life360 Inc (ASX: 360) shares are on the rise in early trade following the company's release of an upbeat March quarterly update this morning. At the time of writing, the Life360 share price is trading 1.69% higher at $6.01.
Let's take a look at how the technology company has been performing.
March quarter highlights
Life360 shares are responding positively after the company reported its growth picked up momentum in March, with its largest market, the United States, showing early signs of recovery.
The company delivered a 20% year-on-year increase in revenue to US$23.0 million with annualised monthly revenue in March improving 26% to US$95.8 million. Its global monthly active user (MAU) base of 28.0 million now matches March 2020 levels, prior to the impacts of COVID-19.
Life360's US MAU base set a new record of 18.1 million, an 8% year-on-year increase and 1 million higher than the December 2020 quarter.
Life360 is on the cusp of positive cash flows with an earnings before interest, tax, depreciation, and amortisation (EBITDA) loss of US$1.5 million. Despite being loss-making, the company maintains a strong capital position with a cash balance of US$53.5 million in March 2021 with no debt.
The company noted that during the March quarter, the majority of paid user acquisition spend remained paused with an investment of US$1.2 million compared to the respective US$1.7 million and US$4.0 million in the December and March 2020 quarters.
Its commentary observed that the performance of traditional user acquisition channels remains challenging, but new channels such as streaming TV are working well. With increasing activity and return on investment, the company is reactivating its marketing spend earlier than initially planned.
The Life360 share price is edging higher following the company's release of the largely positive update.
Management commentary
Life360 chief executive officer Chris Hulls commented on the results, saying:
We are excited by Life360's accelerating growth momentum in the March quarter, particularly in the US where the benefits of the vaccine rollout are beginning to be felt. We are encouraged that the early signs of recovery in Australia are now being replicated in our largest market, the US. Globally, new registrations are at their highest level since March 2020, prior to the onset of COVID. In the US, organic registrations increased… additionally, the month of March delivered the strongest growth in Paying Circle additions since November 2019…
Life 360 share price snapshot
Life360 shares have been on a tear since late January this year, climbing by around 50%. The company's shares jumped almost 20% on the day its full-year results were released on 25 February to what was a new all-time high of $4.70.
The company entered the S&P/ASX 300 Index (ASX: XKO) on 22 March following its surging valuation. Its shares have continued to set new highs in the weeks following, highlighted by another 13% jump yesterday following acquisition news.
