Slide 1: Investor Presentation
Investor Presentation February 27, 2025 ©2025 – ALL RIGHTS RESERVED
Slide 2: Safe Harbor Disclosure
SAFE HARBOR DISCLOSURE This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. The words “anticipate,” “expect,” “believe,” “will,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or other similar words are
Slide 3: Arlo protects your everything
Arlo protects your everything. Arlo is a subscription software business in the smart security segment powered by a scaled, secure, and sophisticated platform with groundbreaking AI capabilities called Arlo Intelligence. We win on focus, innovation, and our privacy pledge. Arlo’s solutions have led t
Slide 4: Arlo At A Glance
Arlo At A Glance AI-powered SaaS business in the Smart Security space Registered Annual Recurring Service Gross Accounts Revenue Margin >11m >$250m >80% ARR Growth Paid Subscribers LTV/CAC Ratio YoY >4.5m >20% 4x The most directly comparable GAAP financial measures are presented in the GAAP to non-G
Slide 5: Registered accounts, paid accounts, ARR and service gross margin
10.8 4.6 $257.3 78.1% 74.2% $210.1 8.7 67.0% 7.2 60.0% 2.8 $137.8 6.1 5.0 1.9 $90.1 47.6% 1.1 $46.6 0.4 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 Reg istered A cco unts Subscriptions – Paid Accounts A nnual Recurring Revenue Non-GAAP Service
Slide 6: Six years to reach $250M of ARR is best-in-class
Six years to reach $250M of ARR is 6 or less years best-in-class 7 – 10 years 11 – 15 years 16+ years 1. The peer group is comprised of the 47 SaaS companies traded on the NYSE and Nasdaq with enterprise values of at least $250M 2. For the peer group, revenue has been used as a proxy for ARR which i
Slide 7: Large, Growing, & Underpenetrated
Global Market Estimated @ 2-3x US Large, Growing, & Underpenetrated Smart Home Security Market Broader DIY Smart Home (Consumer, US) Arlo participates in the broader home security market that is $13.4B sized in the US at $25B in 2025 Adjacent Markets Estimated @ 3-4x TAM is further expanded by Europ
Slide 8: Intelligent, Actionable Notifications and Total System Control
Intelligent, Actionable Notifications Quickly receive notifications from Arlo on any event with the ability to filter out unwanted notifications via AI-based object detection and recognition. Users can also take actions right from the notification. Critical Emergency Alerts During an emergency users
Slide 9: Arlo SaaS Platform
ARLO SaaS PLATFORM A sophisticated and performant SaaS platform built over the last 10 years with artificial intelligence at its core and providing world- class smart security experiences for our users and strategic Strategic Partners partners. Subscription Services 170+ billion AI alerts per year A
Slide 10: Arlo Intelligence
ARLO INTELLIGENCE Object Detection Determines if a person, animal, or vehicle is within the scene during a motion event to help filter and prioritize alerts for the end user. Package Detection Specific alerts when a package is detected and quick prompts to speak with delivery person or call a friend
Slide 11: Press and reviewer quotes on the Arlo Security app
“The companion Arlo Security app is the most impressive security-based app I've ever used.” - How To Geek, Jan 2024 “Motion alerts arrived instantly and were correctly identified.” - PC Magazine, Jan 2024 “I always enjoy the ease and flexibility [Arlo Secure] brings to operating the camera.” - TechH
Slide 12: Our services stand out among consumer subscriptions
Paid Account Monthly Churn Rate(1) Our services standout among comparable 1.1% consumer-based 3.1% subscriptions. 4.0% Our paid account monthly churn is among 4.6% the best compared to consumer subscription peers. 4.7% 6.8% 7.4% 8.7% Security ranks 1st in subscriptions least likely to be canceled. 1
Slide 13: What makes us different and why we'll win
What makes us Differentiators Why It Matters different and why Singular focus on security Every person, every day, dedicated we’ll win in the to our mission smart security Industry-leading video Video is the key to security market. capture and hardware and home automation Data usage and privacy Data
Slide 14: Operating Results
Q4 2024 OPERATING RESULTS INVESTOR PRESENTATION: FEBRUARY 2025 14 ©2025. ALL RIGHTS RESERVED.
Slide 15: Achievement of record SaaS metrics in Q4 2024
Achievement of record SaaS metrics in Q4 2024 Cumulative paid accounts 4.6M Annual recurring revenue $257M | +22% y/y Services revenue mix 53% of total Services gross margin 82% (non-GAAP) INVESTOR PRESENTATION: FEBRUARY 2025 15 The most directly comparable GAAP financial measures are presented in t
Slide 16: Retail & direct paid accounts: World class LTV to CAC
Diving into retail & direct paid accounts (1) shows the outstanding performance of our services World Class LTV to CAC business $12.6 $750 Retail ARPU(2) Retail LTV(4) 92% $200 16 Retail Gross Margin(3) Retail CAC(5) Retail Accounts generate > 80% of ARR INVESTOR PRESENTATION: FEBRUARY 2025 (1) Reta
Slide 17: Paid Accounts & Annual Recurring Revenue (ARR)
Paid Accounts & Annual Recurring Revenue (ARR) 4,599 $257.3 4,235 63% 22% $241.6 Y/Y Growth 3,980 Y/Y Growth $235.0 $227.0 3,235 2,813 $210.1 2,486 $200.0 2,289 $193.6 2,044 $182.6 1,862 $137.8 Q4 ‘22 Q1 ‘23 Q2 ‘23 Q3 ‘23 Q4 ‘23 Q1 ‘24 Q2 ‘24 Q3 ‘24 Q4 ‘24 Q4 ‘22 Q1 ‘23 Q2 ‘23 Q3 ‘23 Q4 ‘23 Q1 ‘24 Q
Slide 18: Service Revenue & Service Gross Margin
Service Revenue & Service Gross Margin $64.1 81.7% $61.9 $60.3 77.4% $56.7 76.7% $55.9 76.4% $51.0 75.2% 74.4% $50.3 74.1% 73.5% $43.9 69.7% $38.3 Q4 ‘22 Q1 ‘23 Q2 ‘23 Q3 ‘23 Q4 ‘23 Q1 ‘24 Q2 ‘24 Q3 ‘24 Q4 ‘24 Q4 ‘22 Q1 ‘23 Q2 ‘23 Q3 ‘23 Q4 ‘23 Q1 ‘24 Q2 ‘24 Q3 ‘24 Q4 ‘24 Service Revenue Service Gro
Slide 19: Operating Income & Free Cash Flow
Operating Income & Free Cash Flow $37.9 $48.6 52% 37% Y/Y Growth Y/Y Growth +$12.9m +$13.2m $35.5 $25 2023 2024 2023 2024 Non-GAAP Operating Income Free C ash Flo w (millions) (millions) INVESTOR PRESENTATION: FEBRUARY 2025 19 The most directly comparable GAAP financial measures are presented in the
Slide 20: Balance Sheet Metrics
Balance Sheet Metrics $151 7.6 $147 45 6.4 $136 5.8 44 44 Q4 ‘23 Q3 ‘24 Q4 ‘24 Q4 ‘23 Q3 ‘24 Q4 ‘24 Q4 ‘23 Q3 ‘24 Q4 ‘24 Cash & ST Investments DSO Inventory Turns (millions) (days) (times) INVESTOR PRESENTATION: FEBRUARY 2025 20 ©2025. ALL RIGHTS RESERVED.
Slide 21: Driving Innovation
Looking Ahead DRIVING INNOVATION INVESTOR PRESENTATION: FEBRUARY 2025 21 ©2025. ALL RIGHTS RESERVED.
Slide 22: A decade of innovation focused on safety
A decade of innovation focused on safety 2014 2018 2019 2022 2023 Arlo Launch Smart AI v1 Smart AI v2 Safe Service ATS Plans The first wire-free camera with World’s first Artificial First AI based package Personal safety service First subscription to combine cloud storage that created a Intelligence
Slide 23: Complete Refresh of All Cameras + Expansion
2025-2026 2026-2027 Complete Refresh of All Cameras + Expansion Next Generation Ecosystem The largest and most comprehensive product launch in company history arriving in time for 2025 Holiday Season and bringing new features with some surprises. Ultra 3 Updated flagship camera line up with updated
Slide 24: Subscription Simplified
Subscription Simplified Based on the success of the Arlo Secure 5 launch in 2024, we have simplified the subscription plans available in 2025. Plus The entry level plan is available in single or unlimited camera versions and now includes all the features from Arlo Intelligence. All plans have also b
Slide 25: Arlo Secure 6 Sneak Peek
Sneak Peak ARLO SECURE 6 Smart Home Security The beginning of combining Smart Home and Home Security into a single platform and user experience to enable the control and automation of third party connected devices. Video Event Description Short and long AI-generated descriptions from the video of a
Slide 26: RapidSOS partnership
PARTNERSHIP The integration of RapidSOS into Arlo’s platform brings new functionality and higher performance emergency response capabilities to our users and strategic partners. Faster Emergency Response The deep integration with RapidSOS’s high performance platform ensures safety agents and 911 age
Slide 27: Origin Wi-Fi motion sensing partnership
PARTNERSHIP Arlo secured a worldwide exclusive right to Origin’s WIFI motion sensing technology which will be integrated into Arlo Secure 6 and creates a unique, differentiating capability for our users and strategic partners. Whole Home Motion Sensing Ability to detect motion across a household or
Slide 28: Samsung partnership
PARTNERSHIP Samsung Samsung and Arlo are working together in partnership to ensure SmartThings users have a best-in-class experience with Arlo smart security cameras. This will include improved performance, 2-way audio, event snapshots, and AI powered intelligent notifications inside of the SmartThi
Slide 29: Financial Outlook
Looking Ahead Financial Outlook INVESTOR PRESENTATION: FEBRUARY 2025 29 ©2025. ALL RIGHTS RESERVED.
Slide 30: Powerful SaaS Business Model
Powerful SaaS Business Model Acquire new subscriptions through highly efficient Convert new households and paid accounts 1 retail channels and strategic partnerships with compelling subscription services 2 • Optimize customer acquisition costs • High Conversion/Attach Rate • Expand global distributi
Slide 31: Q1 and Full Year 2025 Guidance
Q1 2025 Guide Full Year 2025 Guide Total Revenue $114 - $124M $510 - $540M Consolidated Earnings per Share $0.09 - $0.15 $0.56 - $0.66 (non-GAAP) $300M+ Subscriptions Service Revenue Service Gross Margin >80% INVESTOR PRESENTATION: FEBRUARY 2025 31 ©2024 5. ALL RIGHTS RESERVED.
Slide 32: Arlo Capital Allocation Plan
Arlo Capital Allocation Plan Arlo Cash Balance - $150 million at December 2024 Organic Investment Reinvest capital into organic growth opportunities • Next Generation platforms Organic • Arlo Intelligence • SaaS platform expansion Share • Device roadmap expansion Repurchase • Adjacent sales, marketi
Slide 33: Rule of 40 for CY 2025 Guidance Range
US LISTED SOFTWARE COMPANIES WITH CY 2025E RULE OF 40 OF 35% - 40% Rule of 40 for CY 2025 Guidance Range 39% - 41% ARR Growth Estimate for CY 2025 ~25% Current Service Revenue Multiple <4.0 Revenue multiple for companies Multiple for companies with >20% rev growth 7.6x 9.7x Estimates are based on Wa
Slide 34: Original and Current Long-Range Plan
Original Long-Range Plan Current Long-Range Plan MARCH 2022 TARGETS FOR ≤ 2027 TARGETS FOR ≤ 2030 5 Million 10 Million Paid Accounts Paid Accounts $300 Million $700 Million In ARR In ARR ≥10% >25% In Operating Margin In Operating Margin (NON-GAAP) (NON-GAAP) INVESTOR PRESENTATION: FEBRUARY 2025 34 ©
Slide 35: Arlo in 2025
ARLO in 2025 Arlo is set up for a successful year with past investments coming to fruition and numerous opportunities to drive service revenue growth and shareholder value. 1 SaaS Platform Innovation Powerful AI features and platform enhancements 2 Comprehensive Device Launch The largest product lau
Slide 36: ©2024 – ALL RIGHTS RESERVED
©2024 – ALL RIGHTS RESERVED
Slide 37: Appendix
Appendix GAAP to non-GAAP Reconciliations
Slide 38: Reconciliations of GAAP Measures to Non-GAAP Measures
Reconciliations of GAAP Measures to Non-GAAP Measures Gross Profit, In Thousands, except percentage data INVESTOR PRESENTATION: FEBRUARY 2025 38 ©2025. ALL RIGHTS RESERVED.
Slide 39: Reconciliations of GAAP Measures to Non-GAAP Measures
Reconciliations of GAAP Measures to Non-GAAP Measures Operating Income (Loss), In Thousands, except percentage data INVESTOR PRESENTATION: FEBRUARY 2025 39 ©2025. ALL RIGHTS RESERVED.
Slide 40: Reconciliations of GAAP Measures to Non-GAAP Measures
Reconciliations of GAAP Measures to Non-GAAP Measures Free Cash Flow (Usage), In Thousands, except percentage data INVESTOR PRESENTATION: FEBRUARY 2025 40 ©2025. ALL RIGHTS RESERVED.