Arlo Technologies Inc. (ARLO) saw a significant surge in its stock price, soaring 9.65% in pre-market trading on Friday. The smart home security company's stock rally was fueled by two key factors: its robust subscription business growth and a strategic partnership with RapidSOS.
During the company's fourth-quarter 2024 earnings call, Arlo reported impressive growth in its subscription business. The annual recurring revenue (ARR) surpassed $250 million, growing over 20% year-over-year, reflecting the company's success in acquiring and retaining customers. Additionally, Arlo achieved a gross margin on service revenue above 80%, highlighting the efficiency and profitability of its subscription model.
Furthermore, Arlo announced a collaboration with RapidSOS, an AI-driven safety platform, to enhance emergency response through AI-powered video verification. This partnership is expected to provide Arlo with a new revenue stream and increase the value proposition of its products and services by enabling real-time visual confirmation of security incidents for faster and more accurate emergency response.
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