Life360 share price rockets 24% after smashing FY23 earnings expectations

This tech stock delivered a very strong result this morning. How strong was it?

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The Life360 Inc (ASX: 360) share price is rocketing on Friday.

In early trade, the location technology company's shares are up 24% to a 52-week high of $10.13.

This follows the release of its FY 2023 results this morning.

Life360 share price rockets after smashing earnings guidance

  • Revenue up 33% to US$305 million
  • Subscription revenue up 52% to US$200 million
  • Adjusted EBITDA of US$20.6 million
  • Net loss of US$28.2 million
  • Cash and equivalents of US$70.7 million

What happened during the year?

For the 12 months ended 31 December, Life360 reported a 33% increase in revenue to US$305 million. This was in the middle of its guidance range of US$300 million to US$310 million.

A key driver of this growth was its core Life360 subscription revenue, which came in at US$200 million. This was up 52% year on year and ahead of guidance for a ~50% increase.

Underpinning its subscription growth was a 21% increase in Global Paying Circles to 1.8 million and significant price increases. Management believes this underscores the value its subscribers perceive in Life360's services.

Global monthly active users (MAU) grew nearly 13 million or 26% to 61.4 million in FY 2023. This was driven by its ongoing investment in its core location sharing experience. International MAU grew 7 million or 40% to 24.6 million after the company increased the speed and responsiveness of its app. This meant it achieved international feature parity with the U.S.

The highlight of the result was arguably Life360's adjusted EBITDA. It was US$20.6 million for the year, which was comfortably ahead of its guidance range of US$12 million to US$16 million.

And while the company recorded a net loss of US$28.2 million, this was a massive US$63.5 million improvement from FY 2022.

Also improving materially was Life360's operating cash flow, which came in at US$7.5 million. This is a US$64.6 million improvement versus FY 2022. At the end of the period, the company had cash and equivalents of US$70.7 million. This is up from US$63.7 million at the end of the third quarter.

Management commentary

Life360's co-founder and CEO, Chris Hulls, was delighted with the year. He said:

We are incredibly proud that more than 61 million monthly active users (MAU) globally enjoy the peace of mind that comes with the location sharing and safety features of Life360. In CY23 we made significant strides in our member experience, showing our users what their family members are up to, whether they're driving, walking or biking. We put pets and other valuables on the map with Tile, all in the service of our mission to keep people close to the ones they love.

At the same time we made meaningful progress on our path to profitability as we significantly reduced our net loss, and achieved a major milestone by delivering our first full year of positive Adjusted EBITDA and Operating Cash Flow. We are excited to continue building on our leading global position in location sharing, and see exciting opportunities in CY24 and beyond to broaden our reach and deepen engagement with our members.


Life360 has provided its guidance for FY 2024 this morning.

It expects consolidated revenue of US$365 million to US$$375 million and adjusted EBITDA of US$30 million to US$35 million.

The midpoint of its guidance range implies revenue growth of 21% and adjusted EBITDA growth of 58%.

Commenting on the year ahead and its expansion into advertising, Hulls said:

Looking forward to CY24, we are excited to announce the creation of a new advertising revenue stream that offers partners unparalleled reach to Life360's enormous free user base, and more than 20 million daily active users (DAU) connecting with their families and friends. We have consistently spoken of the potential that our investment in the core user experience, and the scaling of our MAU base, would provide for the future. We are encouraged by the success of early testing and see the opportunity to deliver an attractive platform to advertisers, while continuing to provide a great user experience.

The Life360 share price is up $4.72 over the last 12 months.

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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