The Life360 (ASX: 360) share price rips 18% higher on strong results

The Life360 Inc (ASX: 360) share price is running into record territory following a strong 2020 performance and positive outlook.
The post The Life360 (ASX: 360) share price rips 18% higher on strong results appeared first on The Motley Fool Australia. –

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The Life360 Inc (ASX: 360) share price has ripped 18.48% higher into near-record territory following a well-rounded CY20 performance

At the time of writing, the Life360 share price is trading at $4.68 cents.

Strong growth pushing the Life360 share price higher 

Life360 operates a simple to use app developed for families with features that range from communications to driving safety and location sharing. 

In the calendar year, the app made more than 2 million help alerts, covered 52 billion miles of driving with its Life360 crash detection, dispatched more than 14,000 ambulances and made 11 billion safe arrival notifications. 

CY20 proved to be a resilient period in the face of COVID-19. The company continued to focus on building and monetising its user base, with a 39% year-on-year increase in normalised revenue to US$81.6 million, at the upper end of its guidance of US$79-82 million.

The company saw a solid reduction in its underlying earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $16 million, down 44% on the pcp. 

The app recorded 26.5 million monthly active users, near pre-COVID levels of 27.2 million in 2H19. 

Life360 and Google collaboration 

Life360 has rolled out a new feature in Australia, the United States and the United Kingdom, allowing families to get an easy update on their members’ whereabouts by creating a free Life360 account.

This brings together Life360’s leading family coordination services to Google Assistant-enabled devices, including Nest smart speakers, smart displays, Android and iOS phones. 

Randi Zuckerberg appointment

On 20 January 2021, the Life360 share price surged 12% on the announcement that Randi Zuckerberg was appointed as an independent non-executive director. 

She has created award-winning content and experiences that educate families and bring to light issues around digital literacy and safety.

Ms Zuckerberg said:

Similar to what we saw in the early days of Facebook, there’s a strong need for people to connect with a more intimate group – and Life360 offers that intimacy for families and so much more.

It’s exciting to see its success in the family safety space, and I can’t wait to use my experience as a product marketer, content creator and a mother to help the company reach its full potential.

Growth strategy moving forward 

Life360 will focus on three core pillars: building its user base, growing paid membership and expanding reach. 

To build its user base, the company has invested heavily in the free user experience to attract users and stay ahead of the competition. The company has also focused on evolving its brand image from a tracking app or ‘where are you’ to a concept of ‘independence’ and “how are you”. 

The platform’s membership offering is still in its early days. Its new initiatives will aim to improve awareness, conversion and retention of membership offering. 

Finally, the company intends to launch new verticals to expand its reach and revenue potential. This includes options such as hardware devices, elder care and family financial services in the future.  

FY21 outlook 

While there are continuing risks to the company’s revenue streams, it continues to experience organic growth in core subscription revenue. Life360 anticipates that by December 2021, the company will be delivering an annualised monthly revenue in the range of US$110-120 million, a 23% to 34% year-on-year growth rate. 

The company also noted that given current valuations in the US for high growth technology companies, it had received inbound interest that could result in an accelerated listing/dual listing on a US exchange, the acquisition of a strategically important business and/or a merger with a larger entity. 

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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. 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 Bruce Jackson.

The post The Life360 (ASX: 360) share price rips 18% higher on strong results appeared first on The Motley Fool Australia.


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