Life360, Inc. Q3 FY2025 earnings call

Key Points

• Q3 2025 was a record quarter for Life360 with all-time highs in Paying Circles and global net subscription adds.
• Introduced features like no-show alerts and deepened partnership with AccuWeather.
• Launched Life360 Pet GPS, with early demand exceeding expectations. The Pet Finder Network uses members to reunite lost pets.
• Other revenue grew 82% driven by advertising, and the company acquired Nativo to accelerate the advertising road map.
• Annualized monthly revenue reached $446.7 million, up 33% year-on-year, showcasing the durability of the recurring revenue model.

In Q3 2025, total revenue grew 34% year-on-year to $124.5 million. Subscription revenue increased 34% to $96.3 million, with core Life360 subscription revenue (excluding stand-alone hardware subscriptions) rising 37%, driven by global Paying Circle growth and conversion improvements. Other revenue grew 82% year-on-year to $16.9 million, fueled by advertising platform and partnership performance. Stand-alone hardware decreased 4% year-on-year to $11.3 million, with unit sales up 15% but impacted by tariff-related costs.

Guidance

• Raised consolidated revenue guidance from $462 million - $482 million to $474 million - $485 million.
• Raised subscription revenue guidance from $363 million - $367 million to $366 million - $368 million.
• Raised hardware revenue guidance from $42 million - $50 million to $46 million - $50 million, expecting full year gross margin on hardware to be negative single digits due to tariffs and Pet GPS launch.
• Raised other revenue (including advertising and partnerships) guidance from $57 million - $65 million to $62 million - $67 million.
• Raised adjusted EBITDA guidance from $72 million - $82 million to $82 million - $88 million.

Risks

• Material risks and uncertainties that can cause actual results to differ from forward-looking statements, as detailed in the Risk Factors section of Form 10-K and Form 10-Q filings with the SEC. These include market competition, technological changes, and potential impact of tariffs on hardware margins.

Q: Just following up on that question from James on the MAUs, right? Lauren, you sort of mentioned you're focusing on higher intent members. But if I look at the stats that you've given on Slide 15, I think with -- Circles with families and teams has actually decreased a bit, and it looks like members per Paying Circles has also come down from 3.3 to 3.2. Just keen to understand what dynamics playing there if you're actually saying you're getting some of the higher intent MAUs in.

A: A lot of our circles start smaller and grow over time. When we have more new circles, those are smaller circles than bigger circles. Don't read too much into that variance.

Q: On the other revenue front, was that really driven by advertisements or the Placer partnership? And within ads, you had a partnership with Aura. Has that kicked in as well in this quarter?

A: The major growth in Q3 relates to advertising. There's a small element related to data and other revenue and partnerships, but it's primarily driven by advertising. The major part of the Aura advertising revenue will flow through in Q4.

Q: Just subscription guidance. You had a very strong Q3, a notable upside to consensus, but your midpoint for Q4 a little bit below. So just anything unusual about seasonality, Pet GPS, other factors like maybe Street is just sort of mismodeling, I'm not sure, but anything you could say about the subscription guidance?

A: There's nothing unusual in subscription. Q3 is typically our strongest seasonal period. Coming into Q4, we're seeing the same levels of strength. I suspect it's probably just a modeling aspect of the mix of revenue.

Q: For pet, when you comment that it is currently focusing on existing members, can I understand that pet product is now expected to bring more conversion from free users to paid users rather than increasing MAU? And how long the conversion usually take and will be that period change shorter due to the launch of the pet?

A: Our focus is certainly giving our existing free member base a reason to convert. It's really too early for us to extrapolate the timing and when in someone's life cycle are they going to discover that. But we certainly think it will apply to more members more often and earlier in their journey than in the past.