Life360 H2 2024 Earnings Report

Life360 EPS Results

• Actual EPS: $0.10
• Consensus EPS: $0.18
• Beat/Miss: Missed by -$0.08
• One Year Ago EPS: N/A

Life360 Revenue Results

• Actual Revenue: $115.53 million
• Expected Revenue: $114.39 million
• Beat/Miss: Beat by +$1.14 million
• YoY Revenue Growth: N/A

Life360 Announcement Details

• Quarter: H2 2024
• Date: 2/27/2025
• Time: After Market Closes
• Conference Call Date: Thursday, February 27, 2025
• Conference Call Time: 5:30PM ET

Life360 (NASDAQ:LIF) Inc. is a family connection and safety company. Its business category includes mobile app and Tile tracking devices with a range of services, including location sharing, safe driver reports and crash detection with emergency dispatch. Life360 Inc. is based in SAN FRANCISCO.

Life360 H2 2024 Earnings Call Transcript

Presentation

The meeting.

[Raymond Jones, VP - Investor Relations at Life360]

All participants will be in a listen only mode until the question and answer session. When we come to the Q and A, please raise your hand by pressing the raise hand icon at the bottom center of your screen and your line will be unmuted in turn. Participants who have joined by telephone will be in a listen only mode throughout. As a reminder, we will make forward looking statements regarding future events' potential financial performance during this call, which are subject to material risks and uncertainties that can cause actual results to differ materially from such statements. A summary of these risks may be found in the Risk Factors section in our Form 10 K filing with the SEC dated 02/27/2025.

[Raymond Jones, VP - Investor Relations at Life360]

These forward looking statements are based on assumptions that we believe to be reasonable as of today's date, 02/27/2025, and we have no obligation to update these statements as a result of new information or future events, except when required by law. Additionally, we will present both GAAP and non GAAP financial measures on today's call. These non GAAP measures are not intended to be considered in isolation from, a substitute for or superior to our GAAP results and should be read in conjunction with the company's consolidated financial statements prepared in accordance with GAAP. A description of these non GAAP financial measures as well as a reconciliation to the nearest GAAP financial measures are included at the end of the company's earnings media release issued earlier today, which has been posted on the Investor Relations page of the company's website. We have posted an updated investor presentation to the Investor Relations page, which includes additional complementary graphics and data.

[Raymond Jones, VP - Investor Relations at Life360]

Please note that it has been provided as an additional reference and that we will not be using the presentation as an exhibit during today's call. We will begin with a business update by Co Founder and CEO, Chris Hulse and then CFO, Russell Burke, who will provide detail on the Q4 and '20 '20 '4 financials. Chris will then provide some 2025 outlook comments, which will be followed by a Q and A session. We request that participants limit themselves to one question so that we can get through as many participants as possible. I would like to now turn the call over to Chris.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Good afternoon to everyone joining us from The U. S, and good morning to those tuning in from Australia. Thank you for being here for our fourth quarter call results. Let's begin with our most recent results. Flight three sixty made remarkable strides in Q4 twenty twenty four, tapping off the year with our best ever holiday period and achieving record breaking annual results in both monthly active users and paying circles, all while advancing our overall strategy to be a super app for families.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Though we did experience an expected seasonal slowdown in user growth coming out of a very strong Q3, our solid Q4 results underscore our focus on key growth priorities across the board. Our member base expanded again this year growing by 2,800,000 new MAUs to reach a total of 79,600,000, a 30% year over year increase. We also saw solid growth in our paid offerings as our paying circles grew 25% year over year to $2,300,000 with a quarterly net increase of 69,000 paying circles. International expansion was a key driver with international MAUs up 46 year over year and paying circles increasing by 33% even amid price adjustments for legacy subscribers outside of our core triple tiered markets. Average revenue per paying circle in international markets grew by 42% year over year, thanks to updates in our legacy premium pricing strategy, which have allowed us to accelerate experimentation with our new dual tier approach.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

2024 was a transformative year for Life360. Highlights included the successful launch of our advertising business, the introduction of a cutting edge lineup of Tile devices, an award winning brand campaign, a key strategic partnership and investment in Hubbell, and the milestone completion of our U. S. IPO to become publicly traded on the NASDAQ. We also achieved record net additions to our MAUs and subscribers on an annual basis.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

As we enter 2025, we are laser focused on achieving our longer term strategic goals, reaching $150,000,000 MAU, surpassing $1,000,000,000 in annual revenue and exceeding a 35% adjusted EBITDA margin. To achieve these goals, our priorities are to grow our user base, scale our paid offerings, create new revenue streams and enhance profitability. In 2025, we remain committed to providing our members with enduring value, helping them stay connected to the people, pets and things they love. The vast majority of our users come through word-of-mouth or referrals and we remain under penetrated in The U. S.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And lightly penetrated in international markets. Even in our most mature U. S. Regions, we continue to experience strong growth highlighting the significant potential for further expansion. Our freemium model remains central to our strategy offering free members the opportunity to experience Light three sixty and ultimately recognize the unmatched peace of mind provided by premium features.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

This year, we will continue to elevate the Lite three sixty experience by improving location accuracy and speed, while introducing new premium features tailored to specific needs, such as those as pet owners. These enhancements will drive increased user engagement satisfaction creating opportunities for organic virality and referrals. To amplify this, we will strategically invest in marketing to build stronger brand affinity and accelerate conversions from free to paid memberships. Internationally, we are significantly underpenetrated and see vast opportunities for growth. In 2025, we will execute optimized full funnel marketing campaigns in triple tier markets to boost brand awareness and drive MAU growth.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Additionally, we plan to expand the availability of emergency dispatch services triggered by the SOS and car crash detection to more countries unlocking new regions for triple tier and increasing the value of our offerings on a global scale. In Q3 twenty twenty four, we launched our redesigned Tile device lineup, the first fully designed in house by Light360. This lineup differentiates us with innovative features like SOS capabilities, a function unmatched by other devices across Google and Apple networks. During Q4 twenty twenty four, Tile received widespread acclaim as a top quality gift and an essential luggage tracker during busy travel periods, which drove noticeable year over year growth in direct to consumer sales. Tile is becoming a valuable gateway to our Light three sixty subscription business.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

The percentage of U. S. Premium subscribers actively linking Tile to their accounts continue to rise in Q4 'twenty four. In 2025, we'll complete the integration of Tile into the Light three sixty app, making it the exclusive activation platform for all new Tile devices, an exciting step towards streamlining the user experience and further strengthening our ecosystem. Looking ahead, for the Tile integration nearing completion, we are shifting our focus to expanding our GPS hardware lineup designed to make life easier and safer for families.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We plan to finalize the development of a pet tracking device and go to market by late twenty twenty five, followed by an advanced elder care product. These high growth verticals will drive subscription models during the next wave of subscription growth. By delivering purpose driven hardware that spans multiple life stages, we aim to help families stay connected to what matters most. In Q4 'twenty four, we advanced our advertising platform setting the stage for significant growth in 2025. Our goal is to deliver contextually relevant ads and enhance the member experience while offering advertisers unmatched precision powered by our proprietary first party location data.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Key Q4 milestones include activating global programmatic capabilities, expanding audience segmentation tools and advancing ad measurement and attribution. The Life360 ad platform now offers brands unparalleled access to our engaged audience of families. Through custom partnerships such as our collaboration with Uber, we can create tailored campaigns including feature sponsorships, push notifications and co marketing campaigns. For those seeking scale, self managed solutions provide programmatic access to in app native inventory and curated private marketplace deals, leveraging thousands of targetable audience segments. These capabilities empower advertisers connect with the right audiences through major DSPs and media platforms.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

This quarter, we quadrupled our engagement pipeline of prospective partners eager to leverage our unique first party location data. These partners see value in integrating high visibility signals such as shopping behaviors at retail locations with promotions that drive on-site purchases and loyalty participation. While realizing our full advertising vision will take time, early results reinforce our confidence that advertising could eventually rival subscriptions as a major revenue stream. And we are thrilled to announce the purchase of Phanteks Advertising Unit, an AI platform that empowers smarter advertising through cutting edge machine learning and privacy first technology. We are excited to welcome their talented small team to Life360 and look forward to leveraging their expertise to accelerate our advertising capabilities, driving the execution of our 2025 roadmap.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Our data business also grew in Q4, supported by our exclusive partnership with Placer AI, which positions us for accelerated growth in 2025 and beyond. Additionally, our strategic investment in Hubbell secures exclusive access to a promising future enterprise revenue stream. Once Hubbell satellite network scales, it will enhance the location capabilities of our hardware devices. Together, these partnerships highlight our ability to expand both our data business and technology offerings as we drive growth and innovation at Lite three sixty. With that, I'll hand it over to Russell to review the financials and discuss our strategic priority of increasing profitability.

[Russell Burke, CFO & Treasurer at Life360]

Thanks, Chris, and thanks everyone for joining the call today. As a reminder, the Q4 financials I will be referencing are unaudited and denominated in U. S. Dollars.

[Russell Burke, CFO & Treasurer at Life360]

We are

[Russell Burke, CFO & Treasurer at Life360]

very excited to be presenting record breaking Q4 and full year results today. Q4 revenue increased 33% year on year to $115,500,000 a sharp acceleration from the prior quarter, driven by positive momentum in subscription and other revenue. Overall, subscription revenue increased 32% year on year and accelerated from the prior quarter. Core Life three sixty subscription, which excludes hardware subscriptions, increased 36% year on year, driven by the 25% increase in global paying circles and 6% higher ARPPC. Total paying circles growth was supported by improved conversion and retention in The U.

[Russell Burke, CFO & Treasurer at Life360]

S. Hardware revenue for the quarter increased 13% year on year to $23,800,000 Standalone units shipped increased 8% year on year and the average selling price increased by 9%, resulting in improved margins in the quarter. While the new Tile devices have been well received, the key U. S. Cyber Five retail period results were mixed.

[Russell Burke, CFO & Treasurer at Life360]

Consumer direct and online sales were strong during the holiday period, while performance in physical retail stores was softer and consistent with performance observed for consumer electronics in online and brick and mortar retailers in the fourth quarter. Other revenue in Q4 increased 113% to $13,000,000 due to the combination of increases in data and partnership revenue, which includes advertising revenue. December annualized monthly revenue reached $367,600,000 and increased 34% year on year, accelerating from the 30% growth in September, reflecting the strong performance of subscription and other recurring revenue. Q4 gross profit of $85,500,000 increased 42% year on year with gross margins higher at 74% compared with 69% in the prior year due to the increase in the mix of higher margin other revenue. As total revenue grew 33% and gross profit increased 42% year on year, Q4 operating expenses increased only 22% excluding commissions, demonstrating continued operating leverage.

[Russell Burke, CFO & Treasurer at Life360]

R and D costs increased 14% year on year, primarily driven by higher personnel related costs, technology and outside services spend. Sales and marketing costs increased 31% year on year, primarily due to higher commissions, which increased in line with the 32% increase in subscription revenue. Paid acquisition costs were flat year on year due to an intentional shift of allocation of spend to other marketing activity in creative and production, supporting our brand campaigns and holiday sales of the Tile hardware product line. General and administrative expenses in Q4 increased 29% year on year, primarily driven by company growth. We continue to make considerable progress in expanding profitability.

[Russell Burke, CFO & Treasurer at Life360]

First, we recorded positive net income in Q4 of $8,500,000 versus a $3,100,000 net loss for the prior year. Next, adjusted EBITDA was positive for the ninth consecutive quarter, increasing to $21,200,000 in Q4 'twenty four from $8,900,000 in the prior year. And positive EBITDA of $8,400,000 improved from negative $2,000,000 in the prior year as a result of continued strong subscription revenue growth and improved operating leverage. The difference between adjusted EBITDA and EBITDA in the quarter consisted of stock based compensation expense and final U. S.

[Russell Burke, CFO & Treasurer at Life360]

IPO transaction costs. We expect to see this expansion of bottom line margins continue in 2025, as you'll see from the guidance that Chris will discuss shortly. Looking briefly at the full year results for 2024. Total revenue increased 22% year on year to $371,500,000 Gross profit increased 25% year on year to two seventy nine million dollars and gross margins were 75%, two percentage points higher than 2023. Total operating expenses grew 14% year on year, while decreasing six percentage points as a percentage of revenue, driving outperformance against our guidance ranges.

[Russell Burke, CFO & Treasurer at Life360]

Net loss for the year was $4,600,000 a significant improvement of $23,600,000 from the $28,200,000 loss in 2023. Adjusted EBITDA increased $24,900,000 year on year to reach $45,500,000 and exceeded our outlook range. Adjusted EBITDA as a percentage of sales increased from 7% in 2023 to 12% in 2024. Finally, EBITDA loss improved $17,100,000 year over year from negative $20,800,000 in 2023 to a negative $3,800,000 in 2024 and also exceeded our outlook range. One note for everyone, in 2025, we will transition to sharing only adjusted EBITDA in our outlook and results and in our strategic goals in order to create consistency and alignment across our dual listing environments.

[Russell Burke, CFO & Treasurer at Life360]

The EBITDA metric that we've been providing can be manually calculated by excluding stock based compensation from adjusted EBITDA using figures we will disclose in our reconciliations to net income. Looking ahead, we are confident in our ability to grow positive adjusted EBITDA throughout 2025 as we continue balancing robust revenue growth with expanding profitability. Turning now to the balance sheet and cash flow. Slide March ended 2024 with cash, cash equivalents and restricted cash of $160,500,000 a slight increase from Q3. Operating cash flow was positive for the seventh consecutive quarter.

[Russell Burke, CFO & Treasurer at Life360]

Q4 net cash provided by operating activities of $12,300,000 was lower than adjusted EBITDA of $21,200,000 primarily due to an increase in working capital balances driven by increased activity. Net cash used in investing activities of $6,800,000 related to the $5,000,000 investment in Hubbell and payments for internally developed software. Net cash used in financing activities of $5,200,000 related primarily to taxes paid for the net settlement of RSUs and final IPO transaction costs. Thanks for your attention and I'll hand back to Chris to discuss further details on our earnings guidance.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

As we enter 2025, the opportunities before us remain vast and full of potential as we drive to become the number one brand that makes everyday family life better. Our team is focused on creating value for our members and increasing our impact in their lives. Much of our focus for 2025 will be on fully integrating our hardware experiences and extending the peace of mind we offer to the pets and our families. We'll continue to drive growth into international markets, both doubling down in existing markets and expanding into new markets, particularly in Europe. Meanwhile, we continue to gain momentum and increase our investment in advertising aided by the purchase of Phanteks' ads business unit.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

The small team joining us from Phanteks brings a wealth of AI expertise that will help us accelerate our vision for targeting, measuring and delivering unique and high performing ad formats at scale, all leveraging Life360's unique first party data. As we nurture multiple new product lines, including pets and ads, we expect an increase in seasonality and we plan to make significant upfront investments that will strengthen our growth in subsequent years. This effect is particularly pronounced in pet tracking where hardware sales will function as an acquisition vehicle for our subscription product. As Tile becomes a more core part of the Light three sixty experience, we are continuing to lean into hardware as a key part of our subscription ecosystem and will trade off hardware revenue for increased adoption. With that, let's turn to our 2025 outlook, which includes the following: consolidated revenue of $450,000,000 to $480,000,000 subscription revenue of $350,000,000 to $360,000,000 hardware revenue of $45,000,000 to $55,000,000 other revenue, which includes partnerships and advertising of $55,000,000 to $65,000,000 and positive adjusted EBITDA of $65,000,000 to $75,000,000 inclusive of an initial $8,000,000 investment in the 2025 launch of our pet tracking initiative.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We anticipate adjusted EBITDA will be weighted towards the back half of 2025 as we shift forward some sales and marketing expenses to earlier in the year in order to leverage the efficiency we achieved in 2024 and to support global growth initiatives. That concludes our prepared remarks. And I'll now turn the call over to RJ, who will manage the question and answer portion of our call today. Thanks, Chris.

[Raymond Jones, VP - Investor Relations at Life360]

You will need to unmute yourself to ask your question. So for our first analyst, we're looking at Apurv from UBS. Are you there?

[Apoorv Sehgal, Equity Research Analyst at UBS Group]

I'm here, Ajay. Can you hear me?

[Raymond Jones, VP - Investor Relations at Life360]

Absolutely.

[Apoorv Sehgal, Equity Research Analyst at UBS Group]

Good evening, guys. Thanks for taking the time. So my, I guess, one question. Just on the 2025 EBITDA guidance, at the midpoint, it implies about a 15% EBITDA margin. Now even if we add back the $8,000,000 of pet device investment, just you're looking at about a 17% EBITDA margin at the midpoint.

[Apoorv Sehgal, Equity Research Analyst at UBS Group]

And I guess if I just compare that to the fourth quarter of twenty twenty four, you've done about 18% very strong margin there. Now I appreciate there's probably some seasonality benefit in your fourth quarter margins, but just maybe step me through why calendar year 2025 margins wouldn't expand slightly from that Q4 run rate of 18% odd? Is it a function of marketing investment, new people hires or perhaps you're just being a bit conservative? Just keen to hear your thoughts there.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Ralph, do you want to take that one?

[Russell Burke, CFO & Treasurer at Life360]

Sure. No problem. It's a combination of factors. We are definitely investing more in marketing in 'twenty five, and that's partly related to the sort of expansion of international, partly related to pet tracking and partly related to just the efficiencies that we've seen in 2024 and a real sort of bring forward in our payback period. So we can confidently invest more and that will be sort of in the first half of the period.

[Russell Burke, CFO & Treasurer at Life360]

So between that and looking at an investment in pet tracking really ahead of substantial sales in 'twenty six is probably the main reason for that. But we don't expect that this will change our overall path that we've talked about in terms of our EBITDA goals.

[Raymond Jones, VP - Investor Relations at Life360]

With our next question, we'd like to open it up to Wei Sim from Jefferies. Wei, are you there?

[ZheWei Sim, SVP at Jefferies]

Yes, I'm here. Thanks, Chris, Ross and RJ. Yes, Wei from Jefferies. Congratulations on a great result and a strong outlook. So my one question is, you may know we did a proprietary survey of over 1,000 U.

[ZheWei Sim, SVP at Jefferies]

S. Consumers in January, which generated many interesting insights into Life360. One of them, which was really on the material upside from pet tracking into the service addressable market expansion and the upside opportunities for monetization. So this is an area which I'm very excited about. I'd like to get a bit more color as to outside of the investment, when we think this might be launching and the kind of monetization which we could expect into calendar year 'twenty six?

[ZheWei Sim, SVP at Jefferies]

Thanks.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Sure. Let me recap the big vision and then we can talk about launch and rollout. So as we have long shared, our entire strategy is predicated on building a huge free user base, bringing in your family, people you care about, building that trust. And once we have that, then we can layer on different services, pet tracking being an obvious one. And we're so excited about it because essentially half of our customers have a dog.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And if you think about dogs, you don't love them quite as much as your kids, but sometimes pretty darn close. And if you look at the life cycle of a dog, they're around twelve years and even after your kids leave home, you're often getting a new one. So we're so excited that by having this additional feature, we can get people into the premium tiers. It's going to be best in the market. There are going to be a bunch of things that leverage Life360 that others can't do like a pet finding network.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And unlike people on the market now, our CAC for existing customers will be zero. So we will be able to have what I think will be the best device in the market at the lowest cost and it will directly drive subscription revenue. And going back to some of the numbers, we are leaning into hardware more and more. It's not to sell devices, it's to drive subscriptions and drive membership. If you look at timing, we have a bit of a longer staggered rollout because there are some software features.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

But the main launch will start very much towards the end of the year. Our stretch is the holiday season, but you will definitely see pet features this year and just right around the end of that year timeframe the device will be on the market and in coming quarters we're going to share a little bit more about what exactly it will do and how it will differentiate from everything else in the market today.

[ZheWei Sim, SVP at Jefferies]

Great. That's perfect. Thank you so much for that, Chris.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Welcome.

[Raymond Jones, VP - Investor Relations at Life360]

So for next, we'd like to open up the call to either David or Mark from Evercore.

[Analyst]

Hey guys, can you hear me? Yes. This is David on for Mark. I wanted to ask a little bit about your tariff exposure on the hardware side. Can you maybe talk a little bit about how much of your costs are from China and any exposure to other countries at risk of tariffs?

[Analyst]

And then on the pet seasonality, can you just talk a little bit more about pet tracking seasonality? Is that greater seasonality during the summer months? Thank you.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Why don't I take the first half of that and then Russell can answer tariffs. So seasonality, we're not entirely sure yet.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

It is a new product lineup. I have a hunch there will be some level of this being a gifting type products, particularly within families. So I would imagine that does mean we're a little more holiday oriented, probably not nearly pronounced as the Bluetooth devices because they're more stocking stuff or presence, but we'll have to roll it out to find out. And then in tariffs, Russell can answer that, but just a reminder, we're all about driving people to the subscription. So it's going to be less material for us than companies really relying on the hardware to drive the underlying margin because it is all about getting people into those membership tiers roughly.

[Russell Burke, CFO & Treasurer at Life360]

And what I'd say,

[Russell Burke, CFO & Treasurer at Life360]

David, just sort of very specifically is

[Russell Burke, CFO & Treasurer at Life360]

that we have built in an increase in increase in an assumed increase in tariffs into the plan. We like most other hardware manufacturers are looking at the logistics at the moment. We do have a limited amount of exposure to China, but it's relatively easily moved. So we're continuing to look at that. We feel that the cost that we've got built into the plan at this point should be okay.

[Raymond Jones, VP - Investor Relations at Life360]

Next, we'd like to open up the call to James Bales from Morgan Stanley, if you're on. James, can you unmute? Are you there? James, it looks like we're going to have oh, there you are. You've been muted.

[James Bales, Analyst at Morgan Stanley]

Okay. Can you hear me okay?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Yes.

[James Bales, Analyst at Morgan Stanley]

Okay. Perfect. So I just have to ask a follow-up on the pet tracking side. So you've had the experience with Tile and GeoBit not optimizing for sales but for customer acquisition. Can you sort of help us understand how the difference that that's made with engagement for people who've taken that offer up in terms of conversions paid, retention or other ways that it's creating value?

[James Bales, Analyst at Morgan Stanley]

And then secondly, I had a question on the other revenue outlook. There was an incremental $3,700,000 in other in the fourth quarter. How much of that is adds? And is the guidance, the uplifting guidance versus that fourth quarter run rate, how much of that is due to advertising versus some of the other data led products that you're scaling into 2025?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

I'll take the first half of the question and Russell can take the second. So on the first half, so how has tile and GeoBit impacted things, in particular around engagement and conversion retention? First one clarifying things. So GeoBit, after we did that acquisition, we had the market downturn and we did make the extremely frustrating move to largely put that on ice until the market came back. So in many respects, this is the pet tracking device we're launching now is the true launch of GeoBit, what we wanted to do significantly earlier and that was a more frustrating period of time where we had just done those acquisitions and then early twenty twenty two happened.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

When we look at tile though, it's very hard as of now to say X behavior is related to tile, Y is related to other improvements because we've been out of the testing phase for a while. But I will remind everyone that when we did the testing phase, when we did the generic promo paired with the generic promo that said upgrade and get a free tile, we had something like a 30% uplift and significantly improved retention over time. But now tile is part and parcel with everything else. It's very hard to have a holdout group when everything else has been changing. But clearly, we've been hitting record net adds and tile is a big part of that.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So I'm very confident that if it weren't for Tile, we would not be nearly as far along as we are on the core subscription business. So it has felt very vindicating. And even from a qualitative standpoint, if you look at where we are now versus even three years ago or two years ago in terms of attitudes to location devices, they are becoming ubiquitous. So the fact that we are the only company other than Apple and Richard Ulytics, the only cross platform company that has this offer, has the hardware, makes it really, really, really hard for others to complete with us. So I'm feeling extremely good about it.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

In terms of looking at behavior, one thing that is again hard to quantify the impact on this, but we are getting a pretty significant number of our premium subs linking tiles. We don't disclose this, number of our premium subs linking tiles. We don't disclose the number because A, we've been told it needs to be inaudible and that's happened soon. All tiles are going to get activated through Life360, so there would not be a apples to apples benchmark very soon anyway. But we just see it in the reviews, we see how people use it, we just see the reaction from customers, just the magic of seeing your family with their keys and people put them on dogs, that the lightweight version that validates the GPS tracker do well.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And you can just tell that it does really round out Light three sixty and makes us look so much of a more of a platform than an app. And a lot of what we're trying to do as we become the super app for families is helping our customers understand that yes, we're not just this app, we are

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

something more akin to a

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

platform and we are a very natural conduit for other goods and services. So that's part of what's driving that optimism is that we can see it and we do have those early results that showed that the bundling is extremely powerful. And as you can see, we've been performing extremely well, even better than internal expectations in net sub adds.

[Russell Burke, CFO & Treasurer at Life360]

And James, in terms of the second part of your question, the incremental revenue in sort of other revenue in Q4 was really largely advertising driven. And I'd have to say that we were sort of very happy with the way that progressed in the quarter. It was very much along the lines of what we expected. And then looking at the '25 guidance, it's essentially a similar story. While we do expect good growth in sort of data revenue, the majority of the growth in other revenue will be driven by advertising as we see that really sort of ramp up over the course of the year.

[Russell Burke, CFO & Treasurer at Life360]

And generally, it's very much following the sort of the roadmap that we expected and that includes the sort of addition of data science and AI capabilities through the Phanteks acquisition that we made

[Russell Burke, CFO & Treasurer at Life360]

today.

[James Bales, Analyst at Morgan Stanley]

Perfect. Appreciate that color.

[Raymond Jones, VP - Investor Relations at Life360]

All right, great. Next, I'd like to

[Raymond Jones, VP - Investor Relations at Life360]

open it up to Andrew Boone with JMP, if you're available. Andrew, can you unmute?

[Analyst]

Hi, guys. It's Matt on for Andrew. Thanks for taking my questions. My first one is just on The U. S.

[Analyst]

MAU growth. It's been very consistent in 2024. How should we just think about the persistence of growth in 2025? And what are the key levers there? And then can you just give us an update on international triple tier launches in 2025?

[Analyst]

What's the timing there? And any color just on the dual tier and what you're seeing there as well?

[Analyst]

Thank you so much.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So if you take The U. S. Numbers first, it's very hard to know when we slow down. I always tell people, I'm a very optimistic aggressive founder. And also I think I've built a reputation to help with you all of being very reasonable not drinking your own Kool Aid.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So to start with a crazy founder vision, why can't we have 90% penetration in The U. S? Everyone has a family, doesn't always have to be having teenage kids. I have an aging parent right now who I really need the elder care product for. Lots of people use Life360 when they have boyfriends and girlfriends.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

I've been a little bit stunned how even college women in particular are making circles for their friends to stay safe on dates. So our TAM is arguably everybody. Is it likely that we get to 90% penetration? Probably not. But if you told me ten years ago, we'd have states with over 25% penetration, I would have had to pinch myself about possibly dreaming as well.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So what we instead try to say is, let's just look at the numbers. And because so much of our growth is organic, which is obviously an extremely high class problem, we really have to go based on trends. And if you look at trends, we can take our most penetrated states and they're still growing just as quickly if not faster than our least penetrated states. If our least penetrated states were to catch up to our most penetrated states and we didn't have continued growth and the most penetrated ones which we don't have, we would be doubling MAU already. And those trends are continuing.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

The things I am looking forward to say when we that we have hit a saturation point, because we will at some point, I don't know when, and that would be a change in strategy and will be a fine one because we've really been growing the base versus trying to harvest the base. But we have our big back to school bump. At some point that probably fades and that probably says something about penetration. We usually have a big spike after Christmas. That's more of a one off, but it does show when people get new phones, the Life360 one of those things they immediately turn to and install.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And then I would just look at what's happening in general on trends on a region by region level and try to see where we ask them toed out. But the great news for us is that we haven't seen that really in any region yet and we are now seeing international regions follow a similar curve. And there is possible reason to believe that in areas like Europe, we might even do better than The U. S. Because cross platform is such a bigger differentiator there.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And counterintuitively, historically, we've done better in iOS every region. And I think that's because Apple has helped make location sharing not creepy, which it once was. So while it might take a little bit longer to get going in Europe, given the majority of people are on Android phones and Google has really pulled away for most of the initiatives in the space, maybe we do get everyone because there has not been a region where people have said, wow, this just doesn't work for Germans or Swedish or whoever. It seems like we are hitting this very, very universal value prop that resonates with everyone. And so I think we have a long, long way to go and we'll be very open about what these trends look like.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

To your question of dual tier and triple tier and when we're doing different rollouts in different regions, we're taking a more iterative approach this year. When things are vision oriented or product oriented, that's when I work very closely with the team and it's less about the immediate data, it's more about where we believe the world is going to go. But when we're looking at something that really is more around optimizing scarce resources, the team does a very good job of deciding what that right next lever to pull is. So under internal management meetings, we of course challenge and we push on different assumptions. But we are taking more quarter by quarter approach around do we launch a new triple tier region, which is obviously a lot more work, do we optimize more in dual tier.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

What we've seen with dual tier to your question and just for everyone's benefit, dual tier is just a very lightweight version. It doesn't have things like the tow truck dispatch, which just takes a lot more integration work and just infrastructure. It's just letting us move more quickly to start monetizing under monetized countries and then we can get paid acquisition going, which is a very new muscle for us outside of The U. S. So we're working on the plans for the back half of the year now.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Over the next few months, it's a very dual tier optimization focused set of quarters. But we'll know more probably in Q1 earnings, definitely Q2 earnings, we'll be able to share a little bit more specifics in terms of what the next few steps of the roadmap looks like because we'll have had some data from some of these dual tier regions.

[Russell Burke, CFO & Treasurer at Life360]

And just to add to that, Chris, I think the successful launch of dual tier last year has sort of given us a lot of information where we can take this sort of more nuanced, more sophisticated approach that Chris referred to. And that means that ultimately that there will probably be a greater level of customization on a territory by territory basis, but in a way that gives us higher scalability. So as we move forward, there, the lines between triple tier and dual tier might be a little grayer. So but we're we've seen great success in international. We expect a lot of expansion in international in 'twenty five and that's what will drive this.

[Analyst]

Very helpful. Thank you so much.

[Raymond Jones, VP - Investor Relations at Life360]

All right. We'd like to open it up to Laff at MST. If you can unmute.

[Lafitani Sotiriou, Diversified Financials & Technology Analyst at MST Financial]

Hey, guys. I appreciate the opportunity to ask a question. May I sort of follow-up on the advertising revenue and partnerships specifically? So late last year, we heard about Uber and Airity. Can you just talk to what kind of conversations you're having now with other partners?

[Lafitani Sotiriou, Diversified Financials & Technology Analyst at MST Financial]

And can you give us detail around categories that there are live conversations? And just following up in the international market, we noticed there's now ads in Australia. Is it broadly now available ads on in all the international markets? And are you already having any conversations in the international markets about partnerships or is it just in The U. S.

[Lafitani Sotiriou, Diversified Financials & Technology Analyst at MST Financial]

At the moment?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Well, I'll start with the last part of the question. Yes, we're turned on in Australia. We're not in all regions yet. We want to make sure there's enough volume and we're starting that process. But again, this is where the international team has limited resources and we ask them to prioritize the highest ROI activities.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We have many discussions ongoing. We're starting to go to lots of conferences talking to advertisers. We hired Brian McDivitt who came from Google. He had over a decade of doing a similar role there. So our pipeline was long.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

I could name drop lots and lots of companies. I don't know the specifics outside of The U. S. But over time we'll of course give a much deeper look at that. When you look at the pipeline and why we're excited about it, and I think why we are getting this demand aside from having Brian come over with a very deep Rolodex, the Uber partnership has been an extremely powerful one to be able to just show someone what a contextual ad really looks like because we can talk about, hey, we're going to meet people where they are, we're not just going to do the banner, now we can actually show something that's really outperformed and we're looking for other similar ad units.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

When I think of specific categories, retail is an obvious one. Some of that will be tied in with things like off-site advertising where we use our first party location data to do targeting attribution that does tie in with the Phanteks acquisition because they can help with that understanding who these customers are, pairing different data sources together, doing that in a way where raw data doesn't leave our system. So everything targeting wise just gets better that way. There are conversations in cybersecurity, there are conversations in device protection. So it's a pretty wide range of companies that we're talking to.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We'll have deals with our more generic banners kind of rolling out in real time. We won't be announcing all of those because that's just more business as usual. But we are working on how to find the next Uber style custom placements that will drive that real outperformance versus banners, which are more brand oriented versus performance oriented and don't leverage our secret sauce quite as much. Great.

[Raymond Jones, VP - Investor Relations at Life360]

Next, we'd like to open up to Rob at Loop Capital.

[Rob Sanderson, Managing Director at Loop Capital]

Okay. Thank you. I've also got a few questions on the advertising sort of go to market, lots of optionality around here. First on the first party opportunities and specifically the acquisition of AdTech with Phanteks, which seems to make sense. It sounds like this is mostly to help on targeting.

[Rob Sanderson, Managing Director at Loop Capital]

I assume this is intended to just help performance of the ads that you can serve. But maybe can you expand on what the acquisition might enable from a product perspective that was not possible before? And then I've got a couple of follow ups on some of the third party opportunities.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Sure. So a lot of what Phantasys is building out the team with people who are deeply experienced in the ad tech space. It was a relatively small acquisition. So the biggest thing we're getting are people with deep experience in advertising and AI. And yes, you are correct that a lot of it is the targeting and attribution, but there's a lot more there in terms of building out customer profiles.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

I'll get a little bit technical for the moment, but when you think about targeting attribution, you have deterministic insights where you actually can track a device and see what happened after it was served in ad and that ad could be even outside of the Life360 ecosystem with people who gave us permission and our opt in rates to IDFA sharing are extremely high way over industry averages. And that deterministic data, that's something that doesn't need the kind of the deep machine learning as much. But a lot of what the industry does is synthetic data, which is probabilistic, where you don't exactly know where someone went or what they did, but you take different insights and create these profiles and target these synthetic profiles. We're very unique because we have bigger deterministic data sets than almost anyone outside of the Internet giants, so obviously don't let their very wall closed off ecosystem. But we can also build our own synthetic profiles, so we can make inferences about other user attributes based on their location, familial connections and other things we know.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And that is a very specific skill set, which is not one that we've had in the company. So we're really excited about this because we now have a team that's deeply experienced and usually companies have a very specific DNA. And I'd say we were our DNA is consumer products and we're excited that we've now brought on a team that expands us pretty quickly.

[Rob Sanderson, Managing Director at Loop Capital]

Thank you for that. So, yes, the deterministic measurement, but even beyond that, I mean, you can just the high level, the valuable the data seems very valuable to and a

[Rob Sanderson, Managing Director at Loop Capital]

lot of I can imagine a

[Rob Sanderson, Managing Director at Loop Capital]

lot of applicability across the ad ecosystem at large. So when you talk about quadrupling the engagement pipeline, is that sort of mostly like brands like Uber that you could go to market with? Or are we talking about potentially other sort of partnerships? And with that, could that pipeline include what we might consider mega scale ad platforms or even the next tier of large scale ad platforms? Because I'm sure there's a lot of ways to leverage this type of data if done in a privacy safe way and etcetera, etcetera.

[Rob Sanderson, Managing Director at Loop Capital]

So

[Rob Sanderson, Managing Director at Loop Capital]

maybe you could expand on that a little bit.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Yes, it's been all of the above. I am not involved in most of each of the conversations, but when I've got the briefing, we're talking to the retail media networks, interesting retailers who are interested in having ads on the map that pop up. And if we know you went to a certain store and we can call that out and give you a coupon, that's kind of fun and actually feels great for a customer. So it really is all of the above.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And as we progress, I think we'll probably at some point do a breakout. It's a little more ad focused in particular. We can give a little bit more color. I'm not trying to be cagey on it, but it is sort of lots and lots of opportunities in front of us and then we're picking the next one, you'll see a slow steady drumbeat of new things here.

[Rob Sanderson, Managing Director at Loop Capital]

Yes. Obviously, you're very early in the business development journey here, but if we think about first party versus third party, what do you think is the larger opportunity? Sort of where are you putting the bigger focus maybe over the next like two or three years?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

When we think of first versus third party, it's hard to know exactly it's going to be both. I'd love to be able to get you a little more specific answer to your question in coming months because again, we are figuring this out. So I'll talk a little bit about both and I've heard people use first party and third party in different contexts here, but I'll just give a few examples. So when I think about ad places within our app, all first party data, but bringing these partners, that's where we're going to see a lot of these really high performance, really relevant ads that don't feel like ads and those make me very excited. When I think about off-site, which is more third party in the sense that we're going to be working with third party networks who can do targeting and attribution in other properties.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Intuitively, that feels like it could be big and we're just dominate because the big guys completely wall themselves off from other people. And we'll be, I think, the largest company with a first party location data set of this size doing anything like this. One thing to be clear on though is we're not getting out into raw data sales or allowing non service provider entities to access customer data directly. So a lot of what we're trying to do with the system is more around user opted in IDFA matching to just get us outside of the regulatory issues that were a bit challenging a few years ago and were kind of causing a little bit of ongoing anxiety. We don't think we need to go back that direction to monetize and some of the developments such as like the ATT pop up actually are helping us because it really gives us a good framework in which to operate and know what's going to keep us safe both from a regulatory and ideally press standpoint as well.

[Rob Sanderson, Managing Director at Loop Capital]

Okay. Thanks, Chris. I'm excited to see how this comes together for you.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Thank you.

[Raymond Jones, VP - Investor Relations at Life360]

Next, we'd like to open it up for Julian at E and P, please.

[Julian Mulcahy, Managing Director at Evans & Partners]

Chris, I just to ask about your subscription growth forecast, it's pretty strong for this year. Given that like the conversion rate in The U. S. Seems to sort of still in that final quarter and the rest of the world's been sort of declining with the price increase. Are you banking on a big kick up in the conversion rate or is it purely about just MAU growth being pretty strong still?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We're not forecasting any sort of step function. If you look at the numbers and just how it stacks and with MAU growth and international, it does add up to the numbers you get. And looking even at the first couple of months of the year, I feel confident about how all that's trending. International obviously is a very big lever. And I do believe over time the majority of the revenue is going to become from these international regions.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And we are seeing that in regions of similar kind of demographic and socioeconomic status, we're seeing similar results to The U. S. So I think we just had a lot of headroom there. And the team does do a bottoms up model taking existing trends and run rates. And then we look at what has to happen.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And so, no, you do not need a step function in any of the metrics for us to get our numbers, but MAU does have to continue to grow healthily.

[Russell Burke, CFO & Treasurer at Life360]

And just very quickly, Julian, we are seeing really strong continued growth in The U. S. With international sort of coming back to good growth having digested the price increases that you referenced.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And probably one, I think, and Russell, keep me honest, I'm getting this wrong. We actually saw the price increases being absorbed better than in The U. S. I think we actually had a backwards net adds quarter. We did that price increase in The U.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

S. When we did not have that overseas, which is a pretty good omen in my mind.

[Julian Mulcahy, Managing Director at Evans & Partners]

Cool. Thanks, guys.

[Raymond Jones, VP - Investor Relations at Life360]

Next, I'd like to open it up to Maria from Canaccord Genuity.

[Maria Ripps, Managing Director, Senior Research Analyst at Canaccord Genuity Inc]

Yes. Thanks so much for taking my question. Actually, following up on the prior question on your core subscription business, how should we think about sort of your approach to price increases in 2025 given that you've been so successful in sort of taking prices up in key markets over the past couple of years? And I guess how much of sort of like for like price increases sort of in more developed markets is factored into your full year guidance?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Russell, can you start with the back half and then I'll talk the more strategic piece?

[Russell Burke, CFO & Treasurer at Life360]

Yes, absolutely. Maria, what I would say is that we, apart from some optimization in terms of the dual tier strategy that we talked about before, We haven't necessarily built price increases into our plan. We will be opportunistic and if we see that that makes sense, we will do that. But we're not necessarily counting on that in 'twenty five.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And going to the more strategic piece, a very important thing for us while we continue to see the user base growing as quickly as it is, is not to prematurely move into harvest mode. I am highly confident that we could double revenue extremely quickly, honestly within weeks or months if we got more aggressive. But I want us to play the long game. And so we really want to have a very big value surplus. So people really love the brand and feel like they're getting a very good deal.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And at some point again that will change, but we're not at that point in the strategy. When we look at The U. S. Numbers, it has been a couple of years since there's been a price increase, but I don't anticipate we're going to do one in the near future. It is a pretty big process or I shouldn't say big process, but a noisy process because users get a notification via iTunes and even if increased prices of ascent, you would probably get a significant churn event.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So when you aren't doing direct credit card billing where you can just do it on the back end and be more incremental, it's better to do bigger bites more infrequently. And I am very customer focused, so I want to make sure that it's matched with real big step function improvements in the value we give. When you look internationally, we have had very low pricing and that does tend to the whole dual tier, triple tier trade off where we can do moderate price increases very quickly to get people in dual tier that might be a better option than going right to the triple tier setup, which obviously is the highest ARPPCs. That being said, we are looking at where we might be underpriced internationally and trying to more match The U. S.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And figure out how we can kind of from almost a purchasing parity standpoint have similar value and similar pricing. So we probably will have some even triple tier price increases in international regions this year.

[Raymond Jones, VP - Investor Relations at Life360]

Next, we'd like to open up to Wei Wang from RBC.

[Wei-Weng Chen, Director - Equity Research at RBC Capital Markets]

Hi, guys. Thanks for taking the question. Can we maybe speak to the acquisition that you guys announced today? What have you bought there? Is it more of a product or are you buying people and capabilities?

[Wei-Weng Chen, Director - Equity Research at RBC Capital Markets]

Can you maybe give a practical example of what this acquisition kind of unlocks for you guys? And then can you also speak to whether this was a cash or equity based transaction?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So I can take the first half of that. Although we did buy assets, this is primarily getting the team. And this is a team that has worked together for a very long time, the founder of the company's someone we had worked with in the past when he was running another company in the data space. So we know the people well and this has really been able to get us top tier talent very, very quickly and I'd say that's the majority of what makes us excited. That being said, there are some assets, there's some MLAI models that help us segment our customers very quickly.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Some of the infrastructure to plug in with third parties and do segmentation is prebuilt. So it's moving our roadmap along a little faster than if we were to do it ourselves, but with a much better talent bench and more starting on third base versus hiring up unknown entities that may or may not be as successful. So, it really de risks in our mind the infrastructure we need to build.

[Russell Burke, CFO & Treasurer at Life360]

And Wade, just on the specifics of your question, we've said it's a small acquisition. As Chris said, it's mainly about the sort of people and the models. Very specifically, it's $4,500,000 asset acquisition with a mix between cash and equity.

[Raymond Jones, VP - Investor Relations at Life360]

All right. The next question will be from Mark from Stifel.

[Mark Kelley, MD - Internet at Stifel Financial]

Great. Thanks very much, guys. Chris, can you clarify the comment you made earlier about an increase in seasonality? Was that is that just focused on the hardware side? Or is that a broader statement?

[Mark Kelley, MD - Internet at Stifel Financial]

That's my first question. And then the second one, one, appreciate the commentary on pets. I guess, can you give us maybe an update on the product roadmap or just general thoughts about elder care? That would be great.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Sure. On the seasonality, please, do you remember the context of which comment that was?

[Mark Kelley, MD - Internet at Stifel Financial]

It was part of the wrap up to the guidance, I believe, in your prepared remarks.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Got it. The seasonality is Russell, do you remember the exact specifics?

[Russell Burke, CFO & Treasurer at Life360]

Mark, the only point we're making there is that as we move forward, we are becoming a little more seasonal with obviously, we've had that seasonality with hardware Advertising as it ramps up is seasonal both in terms of the ramp up, but also in terms of obviously there's more activity in sort of holiday seasons etcetera. So that's that was the gist of the comment. But the other aspect which I specifically talked about is that we are increasing marketing spend a little more this year and that's a little bit first half weighted in order to really help drive subscription over the course of the year.

[Mark Kelley, MD - Internet at Stifel Financial]

Okay, perfect. Thank you, Russell.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And on the eldercare front, I'll start with a bit of a personal anecdote. So, I am working on this feature with our former COO, David Rice, who's running international and also doing special projects with me. We unfortunately both have moms who are going to be users of what we're building. My mom has dementia and David's mom is just getting to that age where brain is sharp but really need a lot of help. So we are both experiencing the products in the market today and we are just this should be the easiest layup in the world because they all suck, they are low quality, nobody likes them and they're exorbitantly priced.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And if you look at what we can do in many regards, it's the same advantage we already have, which is we already have the customers and we often already have the seniors who are using Life360 standalone, but now need a little bit of extra help and they don't feel threatened by Life360, in particular, just more frail seniors, non memory care ones, because they're already in the ecosystem. And so if you look at what we can do, we're going to start with software only features, which are very simple ones like his mom or dad or whoever. When's the last time they picked up the phone? Are they taking steps? I know for my mom, a lot of the time she's just in the house and she does pick up her phone, but I don't know if she's been active.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

And I have done all these weird hacks like I check her video doorbell, I check different cameras in the house, I have this thing called the Jubilee TV, which is actually quite good, which sends his presence in the room. We can do that all from the phone. We can also do that when we have a device, like mom was last active an hour ago. Can't really get that from Life360 Day because all you know is where the phone is. So we can do that purely in software than with the hardware.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We have a huge network of people. I live in a small town and it's very helpful where people actually a couple of times my mom has wandered and they've helped bring her home and that's been very nice. But imagine if you didn't have that personal tie, you could notify the nearby Light three sixty members around you that, hey, this person has wandered and here's where they are, can you help them out? I have a bit of that community feeling. And then from a hardware standpoint, a lot of what exists on the market is usually as I fall and I can't get up alarm services.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

They're really more marketing companies because they were not targeting the millennials and younger Gen Xers who are now the buyers of these products that are aging parents. They were going through late night TV and doctors offices and they were not winning on product quality. So bad battery life, bad industrial design, not very comfortable, none of the technology we have. And so if you look at what we can do, we'll be able to pair a hardware device to the phone, we'll be able to really have good battery life, it's going to be seamlessly integrated in Life360, so not a whole new product. And that same story of we will not have a customer acquisition cost when we market to our own customers, then we can pick up signals.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We people now say their roles in the family. We know exactly who's a grandparent. We know how old they are. We can start surfacing these different features to you. If we see a senior moves to a new home, that often might mean they're moving to a senior residential neighborhood.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

That's a great time for us to start helping our customers out. So that will be 2026. I wish we could do it sooner, it's just scarce resources. But the really cool thing about our hardware strategy is if you take the pet device and the senior device, it's kind of the same thing just with a different shell around it. So the technology is very extensible and even some of the software features are going to be similar.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We're going to have the pet finding network, which our competitors can't really have because they don't really have the customer base we do. Lost pet, lost senior, lost kid, it's really all the same feature. So I'm excited to start this drumbeat of launching out into these different services that line up to the core and build out that people pets things ecosystem that I think is really just starting to come to life right now.

[Raymond Jones, VP - Investor Relations at Life360]

We've come to the end of our time. This last question is from Chris Savage at Bell Potter and then we'll close out the call.

[Chris Savage, Head of Research at Bell Potter Securities]

Thanks Ajay. Very quick. So bit of skill, but you're suggesting hardware revenue will go backwards this year and that's obviously despite the relaunch or the new product launch of Tile. So what's driving that? Are you basically going to give more away to drive subscription, either GeoVid or Tile?

[Chris Savage, Head of Research at Bell Potter Securities]

Or what's the story there?

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

Sure. So we're focused on first, as you mentioned, giving them away and driving subscriptions. That's the reason we did the acquisition. We know hardware revenue isn't particularly exciting. It's not a great business to be in per se, but driving subscriptions is a great business.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

So that's continuing to be more of the theme. We actually will be deprecating the Tile app. We'll all be through Lite three sixty. And every time you buy a Tile device, you will be activating your account on Lite three sixty, which gives us that swing and upsell. So we would definitely prefer lower pricing, giving more away, all that if it's going to drive subs.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

We should also be open that retail has been challenging. I think at some point, especially with pets and all that, when we're going to be very differentiated, it will help. But we need to be open that Apple really does dominate this space right now. And when retailers already have AirTags and there's been kind of a declining brick and mortar foot traffic presence in consumer electronics anyway, that's been frustrating, but not really impacting that core. And as we differentiate and if this Hubbell partnership works and I'm very excited to give updates on that, we will leapfrog AirTags and maybe we can bully everybody out because if we have the satellite compatible tile devices, the only benefit that we see Apple having will go away and we're cross platform and we don't have any of the owners controls, but that will probably be more of a 26 thing.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

But for now, focused on driving subscriptions, lowering costs, giving them away with some admitted weakness in retail as we still are fighting those headwinds of just the broader trends and Apple still being this behemoth we're chipping away at.

[Raymond Jones, VP - Investor Relations at Life360]

This concludes our call. Chris, I'll

[Raymond Jones, VP - Investor Relations at Life360]

turn it back over to you real quick for parting remarks.

[Chris Hulls, Co-Founder, CEO & Executive Director at Life360]

I have no parting remarks. Very excited about the year to come and spending some time with some of you in coming weeks. Thank you all.

Participants

Executives

• Raymond Jones, VP - Investor Relations
• Chris Hulls, Co-Founder, CEO & Executive Director
• Russell Burke, CFO & Treasurer

Analysts

• Apoorv Sehgal, Equity Research Analyst at UBS Group
• ZheWei Sim, SVP at Jefferies
• Analyst
• James Bales, Analyst at Morgan Stanley
• Lafitani Sotiriou, Diversified Financials & Technology Analyst at MST Financial
• Rob Sanderson, Managing Director at Loop Capital
• Julian Mulcahy, Managing Director at Evans & Partners
• Maria Ripps, Managing Director, Senior Research Analyst at Canaccord Genuity Inc
• Wei-Weng Chen, Director - Equity Research at RBC Capital Markets
• Mark Kelley, MD - Internet at Stifel Financial
• Chris Savage, Head of Research at Bell Potter Securities