Over the last 3 months, the Life360 Inc (ASX: 360) share price has dropped 40%, with some investors citing concern about slowing growth in monthly active users (MAU). This deceleration may be prompting investors to revise their expectations downward after a period of strong performance. In addition, conversion rates are a potential sticking point for some, with only 2.7 million paying subscription groups across its 91.6 million monthly active users as at Q3 2025.
But it's also worth noting that there are other factors at play. Investors are likely also nervous about a stretched valuation, with poor sentiment being seen across the broader tech sector.
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Deceleration in user growth an intentional shift, company reports
MAU growth did slow in Q3 2025. However, this aligns with a reported shift in marketing focus from volume to high-quality acquisition, retention, and conversion. And with over 50 million monthly users in the US, it remains comparable to popular consumer platforms, including Netflix, Spotify Technology, and Pinterest.
In my view, there is still potential for active user growth to pick up pace in the current landscape. With heightened instability across the US, I believe we may well see more consumers looking to increase personal security. Life360 is well placed to deliver, with a user-friendly app that delivers peace of mind.
Nativo acquisition has the potential to further boost revenue
Life360 continues to post solid revenue growth, up 34% year on year at Q3 2025. And the recent acquisition of Nativo Inc introduces new avenues to grow and reach revenue beyond its core tracking app.
Nativo is an advertising tech platform that delivers a premium 'native ad' experience, contextual advertising that blends into the content around it. The acquisition makes sense for Life360, as it holds a wealth of data that can better connect advertisers and consumers.
And it could prove a perfect match. Nativo can deliver a premium advertising experience within the Life360 platform, enabling it to increase monetisation opportunities from an engaged user base.
Does the current Life360 share price represent a good buy?
I think there is still value to be had for investors, given its recent share price decline. Zooming out, the price has actually risen 10% over the last year and 500% over the last five years. The current climate and the Nativo acquisition put Life360 in a strong position to continue to grow revenue for the foreseeable future.
In addition, its capital-light business model offers strong operating leverage. This gives it the potential to grow profit faster than its revenue, assuming it remains disciplined in execution.
All of this comes with a caution that you may still need to ride out some volatility in the short term, but I believe that at current prices, it can be viewed as a solid opportunity for long-term investors.
