The Life360 Inc (ASX: 360) share price was an impressive performer in May.
During the month, the location technology company's shares rocketed a massive 51%.
As a comparison, the ASX 200 index rose 3.8% over the same period.
Why did the Life360 share price rocket in May?
Investors were fighting to get hold of the company's shares last month following a rebound in the tech sector and in response to the release of its first quarter update.
In respect to the latter, for the three months ended 31 March, Life360 posted a 32% increase in revenue over the prior corresponding period to US$103.6 million. This was driven by a 33% increase in total subscription revenue to US$81.9 million, with core subscription revenue lifting 37% to US$76.2 million.
Also growing at a rapid rate was its annualised monthly revenue (AMR). It jumped 38% to US$393 million. This ultimately led to the company posting adjusted EBITDA of US$15.9 million for the three months, which was more than triple the US$4.3 million it reported a year earlier.
Goldman Sachs was impressed with the quarter. Commenting on the result, the broker said:
Life360's 1Q25 result was above VA consensus expectations at the Revenue/gross profit/Adj. Ebitda lines with continued growth in core subscriptions and supported by the implementation of advertising revenue as hardware was broadly flat YoY. FY25 headline guidance remained unchanged (higher subscription offsetting lower hardware) while long-term earnings growth prospects incrementally improved with the added downward pressure on Apple IAP fees.
Outlook
As Goldman mentioned above, Life360 reaffirmed its guidance for FY 2025. It expects consolidated revenue of US$450 million to US$480 million and positive adjusted EBITDA of US$65 million to US$75 million. Both will be up strongly on the prior corresponding period.
Life360's CFO, Russell Burke, said:
Looking ahead, even as consumer financial pressures intensify, our core subscription business remains resilient and we have largely mitigated the impacts of an uncertain tariff environment, so that the anticipated overall impact is not material. We remain confident in our ability to continue delivering positive Adjusted EBITDA throughout 2025. Our focus on balancing strong top-line growth with expanding profitability positions us well to succeed in increasingly demanding market conditions.
This latest gain means that the Life360 share price is now up 110% since this time last year. Here's hoping the next 12 months will be equally prosperous for its shareholders.
