The Life360 Inc (ASX: 360) share price has sunk 6% after the ASX tech share revealed its March 2024 quarterly update.
Life360 provides an app for families to track the location of other people in the family, it provides reports of whether drivers are being safe, and it has “crash detection with emergency dispatch” capabilities.
March 2024 quarter
Life360 reported its first quarter revenue increased by 15% to $78.2 million, which was a year over year increase of 15%. Total subscription revenue rose 91% to $61.6 million and ‘core subscription’ revenue went up 19% year on year to $57 million.
The ASX tech share revealed its annualised monthly revenue (AMR) went up 19% year on year to $284.7 million.
Life360 reported positive adjusted EBITDA of $4.3 million, though the late Charline Munger wouldn’t have liked that metric. Its actual EBITDA was a loss of $4.1 million. In the first quarter of 2023, it made $0.5 million of adjusted EBITDA and an EBITDA loss of $12.6 million.
Cashflow continues to improve for the business. It revealed positive operating cashflow of $10.7 million for the March 2024 quarter, which was a year-on-year improvement of $19.9 million. This could help the Life360 share price if cashflow keeps rising.
Life360 revealed its cash position finished the March quarter at $74.6 million, an increase of $3.9 million from the fourth quarter of 2023.
In terms of monthly active users (MAU), there was a global increase of 4.9 million, which saw a 31% year on year increase to approximately 66.4 million. It talked of “significant momentum, particularly in a seasonally lower period for MAU growth.”
Global ‘paying circle’ net additions amounted to 96,000, which was a record for the first quarter. This led to a 21% increase year on year to 1.9 million, supported by “improved conversion and retention.”
Interestingly, the business reported that the net hardware units that were shipped fell by 6% year on year to 0.5 million, while the average selling price declined 4% year on year to $16.50.
Outlook for the Life360 share price
The company said it was maintaining its 2024 guidance, with revenue projected to be between $365 million to $375 million, while adjusted EBITDA is projected to be between $30 million to $35 million.
The EBITDA loss is expected to be between $8 million to $13 million in 2024, while the cash balance is projected to be between $80 million to $90 million.
It’s still growing revenue at a good pace, but it seems the update wasn’t as good as some investors were expecting. But, with the Life360 share price up 150% in the last year, I wouldn’t say it’s cheap even after this decline. There are other ASX growth shares I’d rather buy.
