LIF 10-K & 10-Q changes, risk factors and insider trading
Life360, Inc. (also LIFX) · Nasdaq · Services-Computer Processing & Data Preparation · CIK 1581760 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We are affected by seasonality, which may cause fluctuations in our operating results and affect investor expectations.”
New heading “Our advertising offerings, including those developed through the acquisition of Nativo, are new and subject to various risks and uncertainties, which may adversely affect our business.”
New heading “Changes in laws regulating subscription and auto-payment renewals may be unfavorable, which could have a material adverse effect on our business, reputation, financial condition, and results of operations.”
New heading “Risks Related to Our Indebtedness”
New heading “Our indebtedness and liabilities could adversely affect our financial condition and results of operations and limit the cash flow available for our operations, which may impair our ability to satisfy our obligations under our 0.00% Convertible Senior Notes due 2030 (the “June 2025 Convertible Notes”).”
New heading “We may be unable to raise the funds necessary to repurchase the June 2025 Convertible Notes for cash following a fundamental change (as defined in the indenture governing the June 2025 Convertible Notes) or to pay any cash amounts due upon maturity or conversion of the June 2025 Convertible Notes, and our other indebtedness may limit our ability to repurchase the June 2025 Convertible Notes or to pay any cash amounts due upon their maturity or conversion.”
New heading “The capped call transactions entered into in connection with the pricing of the June 2025 Convertible Notes may affect the value of our common stock.”
New heading “We are subject to counterparty risk with respect to the capped call transactions, and the capped call may not operate as planned.”
New heading “Provisions in the indenture governing the June 2025 Convertible Notes could delay or prevent an otherwise beneficial takeover of us.”
Removed heading “Our business is subject to numerous risks and uncertainties. These risks and uncertainties may cause our operations to vary materially from those contemplated by our forward-looking statements. These risk factors include:”
Removed heading “Our employees, consultants, third-party providers, partners and competitors could engage in misconduct that materially adversely affects us.”
Removed heading “If we fail to offer high-quality customer support, our customer satisfaction may suffer, and it may have a negative impact on our business and reputation.”
Removed heading “Our growth strategy includes expanding in international markets which requires significant resources and management attention. Failure to execute on our growth strategy could have an adverse impact on our business, financial condition and results of operations.”
Removed heading “If we cannot maintain our corporate culture as we grow, our business may be harmed.”
Removed heading “We have had operating losses each year since our inception and we may not achieve or maintain profitability in the future.”
Removed heading “Our insurance coverage may be inadequate to cover future claims or losses.”
Removed heading “Adverse developments affecting financial institutions, companies in the financial services industry, or the financial services industry generally, such as actual events or concerns involving liquidity, defaults or non-performance, could adversely affect our operations and liquidity.”
Removed heading “We are affected by seasonality.”
Removed heading “Our operating margins may decline as a result of increasing product costs and inflationary pressures.”
Removed heading “We may be required to delay recognition of some of our revenue, which may harm our financial results in any given period.”
Removed heading “Our financial condition and results of operations are subject to foreign currency fluctuation risks.”
Removed heading “Our patent applications may not result in issued patents, and our issued patents may not provide adequate protection, which may have a material adverse effect on our ability to prevent others from commercially exploiting products similar to ours.”
Removed heading “We incur significant legal, accounting, reporting and other expenses and are subject to additional regulations and requirements as a result of being a public company with CDIs listed on the ASX and common stock listed on Nasdaq, and our management is required to devote substantial time to complying with Delaware laws, Australian laws, and reporting requirements pursuant to U.S. and Australian securities laws, which could lower profits and make it more difficult to run our business.”
Removed heading “We may be required to delay recognition of some of our revenue, which may harm our financial results in any given period.”
Largest changes
“Our employees, consultants, third-party providers, partners and competitors could engage in misconduct, including the misuse of data and intentional failures to comply with applicable laws and regulations (including those related to cybersecurity or data privacy, or those prohibiting a wide range of pricing, discounting and other business arrangements), report financial information or data accurately, or disclose unauthorized activities. Such misconduct could result in legal or regulatory sanctions and cause serious harm to their and our reputation. …”see in full comparison
“Further, international operations entail a variety of risks, including currency exchange fluctuations, challenges in staffing and managing foreign operations, tariffs and other trade barriers, unexpected changes in legislative or regulatory requirements of foreign countries that manufacture, or into which we sell, our products and services, difficulties in obtaining export licenses or in overcoming other trade barriers, laws and business practices favoring local companies, political and economic instability, limitations on advertising, difficulties protecting or procuring intellectual …”see in full comparison
“We expect these rules and regulations to increase our legal and financial compliance costs and to make some activities more time-consuming and costly, although we are currently unable to estimate these costs with any degree of certainty. Our management will need to devote a substantial amount of time to ensure that we comply with all of these requirements. …”see in full comparison
“Adverse developments affecting financial institutions, companies in the financial services industry, or the financial services industry generally, such as actual events or concerns involving liquidity, defaults or non-performance, could adversely affect our operations and liquidity.”see in full comparison
“Relevant stakeholders (such as government authorities and adjudicatory bodies) may determine that we have been in the past or are presently noncompliant with our data privacy and security obligations as we may at times fail (or be perceived to have failed) in our efforts to comply with such obligations. This risk will likely increase as we grow our market presence in the U.S. and outside the U.S. Moreover, despite our efforts, our personnel or third parties on whom we rely, may fail to comply with such obligations, which could negatively impact our business operations. …”see in full comparison
In order for us to succeed, our information technology systems and infrastructures must perform well on a consistent basis. Our products and systems rely on software and hardware that are highly technical and complex and depend on the ability of such software and hardware to store, retrieve, process and manage immense amounts of data. We may in the future experience system interruptions that make some or all of our systems or data temporarily unavailable and prevent our products from functioning properly for our members; any such interruption could arise for any number of reasons, including software bugs and human errors. Further, our systems and infrastructures are vulnerable to damage from fire, power loss, hardware and operating software errors, cyber-attacks, technical limitations, telecommunications failures, acts of God, the financial insolvency of third parties that we work with, global pandemics and other public health crises, and other unanticipated problems or events. While we have backup systems in place for certain aspects of our operations, not all of our systems and infrastructures are fully redundant. Disaster recovery planning can never account for all possible eventualities and even if we anticipate an incident, our incident response, business continuity and disaster recovery plans may not be sufficient to timely and effectively address the issue, and our property and business interruption insurance coverage may not be adequate to compensate us fully for any losses that we may suffer. Any interruptions or outages, regardless of the cause, could negatively impact our members’ experiences with our products, tarnish our brand reputations and decrease demand for our products, any or all of which could materially adversely affect our business, financial condition and results of operations. Moreover, even if detected, the resolution of such interruptions may take a long time, during which customers may not be able to access, or may have limited access to, the service.see in full comparisonSee “—If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences.”
Full comparison: every changed paragraph (277)
Our business is subject to a high degree of risk. You should carefully consider the risks described below, as well as the other information in this Annual Report on Form 10-K, including our financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The occurrence of any of the events or developments described below could harm our business, financial condition, results of operationsoperations, and prospects. In such an event, the market price of our common stock could decline.
Our business is subject to numerous risks and uncertainties. These risks and uncertainties may cause our operations to vary materially from those contemplated by our forward-looking statements. These risk factors include:
•If we fail to retain existing members or add new members, or if our members decrease their level of engagement with our products and services or do not convert to paying subscribers, our revenue, business, financial conditioncondition, and results of operations may be significantly harmed.
•If we fail to monetize members through subscription plans, our business, financial condition and results of operations may be harmed.
•If we are not able to maintain the value and reputation of our brands, or if we are not able to compete successfully with current or future competitors, our ability to expand our member base and maintain our relationships with partners and other key service providers may be impaired and our business, financial conditioncondition, and results of operations may be harmed.
•We have in the past, and may in the future need to change our pricing models to compete successfully.
•The market for our offerings is evolving, and our future success depends on the growth of this market and our ability to anticipate and satisfy consumer preferences in a timely manner.
•Changes to our existing brands, productsproducts, and services, or the introduction of new brands, productsproducts, or services, could fail to attract or retain members or generate revenue and profits.
•Unfavorable media coverage and publicity could damage our brands and reputation and materially adversely affect our business, financial condition and results of operations.
•Inappropriate actions by third parties or certain of our members could be attributed to us and cause damage to our brands.
•Our business could be harmed if we are unable to accurately forecast demand for our products and services and to adequately manage our product inventory.
•Our growth and profitability rely, in part, on our ability to attract members through cost-effective marketing efforts. Any failure in these efforts could materially adversely affect our business, financial conditioncondition, and results of operations.
•Distribution and marketing of, and access to, our products and services depends, in significant part, on third-party publisherspublishers, retailers, and platforms. If these third parties change their policies in such a way that restricts our business, increases our expenses or limits, prohibits or otherwise interferes with or changes the terms of the distribution, use or marketing of our products and services in any material wayway, or affects our ability to collect revenue, our business, financial conditioncondition, and results of operations may be adversely affected. Such changes could also negatively affect the functionality, performance, or quality of our products and services.
•We depend on retailers and distributors to sell and market our hardware products, and our failure to maintain and further develop our sales channels could harm our business.
•We rely on a limited number of suppliers, manufacturers, and fulfillment partners for our smart trackers. A loss of or change with any of these partners could negatively affect our business, including the potential inability to produce or obtain quality products and services on a timely basis or in sufficient quantity.
•If we do not successfully coordinate the worldwide manufacturingmanufacturing, fulfillment, and distribution of our products, we could lose sales, which could materially adversely affect our business, financial conditioncondition, and results of operations.
•Our manufacturer’s facilities are located in the PRCMalaysia and Malaysia.the PRC. Uncertainties with respect to the legal system of the PRC, including uncertainties regarding the enforcement of laws, and sudden or unexpected changes in policies, laws and regulations in the PRC could materially adversely affect us. Disruption in the supply chains from the PRC and Malaysia could also adversely affect our business.
•Our apps are currently available for download internationally and in the future we expect to penetrate additional international regions, including certain markets and regions in which we have limited experience, which subjects us to a number of additional risks.
•We rely on key data partners, and any termination of our agreements with such data partners could have a material adverse effect on our revenues, business, financial condition, and results of operations.
•Investment in new business strategies, partnershipspartnerships, and acquisitions could fail to produce the expected results, disrupt our ongoing business, present risks not originally contemplatedcontemplated, and materially adversely affect our business, reputation, results of operationsoperations, and financial condition.
•The limited operating history of our new brands, products and services makes it difficult to evaluate our current business and future prospects.
•We have grown rapidly in recent years and have limited operating experience at our current scale of operations. If we are unable to manage our growth effectively, our brands, company cultureculture, and financial performance may suffer and place significant demands on our operational, risk management, sales and marketing, technology, compliancecompliance, and finance and accounting resources.
•Our operating margins may decline as a result of increasing product costs and inflationary pressures.
•OurWe actualare or perceived failuresubject to complystringent withand evolving laws (U.S. and regulationsforeign), concerningregulations, rules, contracts, policies and other obligations related to data privacy and security, data protection, consumer protection, advertising, location tracking, digital tracking technologies, and thosethe relatedprotection of minors. Our actual or perceived failure to children’scomply datawith such obligations could lead to regulatory investigations or actions; litigation (including class action or similar lawsuits); fines and penalties; changes to or disruptiondisruptions of our business operations; reputational harm; loss of revenue or profits; declines in member growth or engagement; and other material adverse business consequences. In certain foreign jurisdictions, we have limited operating experience, compliance risk may be heightened.
•If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise.
•Our success depends, in part, on the integrity of our information technology systems, of third-party systems and infrastructures, onas thewell continuedas andthose unimpededof accessthird to our products and servicesparties on thewhich internet,we rely, and on our ability to enhance, expandexpand, and adapt these systems and infrastructures in a timely and cost-effective manner. Any compromise, disruption, or failure of these systems could result in material adverse consequences, including operational disruptions, loss of data, regulatory investigations, reputational harm, and financial loss.
•We may fail to adequately obtain, protectprotect, and maintain our intellectual property rights or prevent third parties from making unauthorized use of such rights.
•Our business is subject to complex and evolving U.S. and international laws and regulations. Failure to comply with such laws and regulations could result in claims, changes to our business practices, monetary penalties, increased cost of operations, reputational damage, or declines in member growth or engagement.
•Our indebtedness and liabilities could adversely affect our financial condition and results of operations and limit the cash flow available for our operations, which may impair our ability to satisfy our obligations under our 0.00% Convertible Senior Notes due 2030 (the “June 2025 Convertible Notes”).
•We may be unable to raise the funds necessary to repurchase the June 2025 Convertible Notes for cash following a fundamental change (as defined in the indenture governing the June 2025 Convertible Notes) or to pay any cash amounts due upon maturity or conversion of the June 2025 Convertible Notes, and our other indebtedness may limit our ability to repurchase the June 2025 Convertible Notes or to pay any cash amounts due upon their maturity or conversion.
•Provisions in the indenture governing the June 2025 Convertible Notes could delay or prevent an otherwise beneficial takeover of us.
•We have identified a material weakness in our internal control over financial reporting in the past. If we identify additional material weaknesses in our future or otherwise fail to maintain effective internal control over financial reporting, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and the price of our common stock and CDIs.
•We incur increased costs and are subject to additional regulations and requirements as a result of becoming a U.S. reporting company, and our management is required to devote substantial time to complying with Delaware laws, Australian laws, and reporting requirements pursuant to U.S. securities laws, which could lower profits and make it more difficult to run our business.
If we fail to retain existing members or add new members, or if our members decrease their level of engagement with our products and services or do not convert to paying subscribers, our revenue, business, financial conditioncondition, and results of operations may be significantly harmed.
Our business model is predicated on building a large critical mass of members and monetizing them directly through subscription-based products and services we build ourselves, and indirectly by allowing third parties to derive value from our members. Our financial performance has been and will continue to be significantly determined by our successability into adding,attract, retainingretain, and engaging ourengage members and convertingconvert membersthem into paying subscribers. We expecthave in the past, and may in the future, experienced that the size of our member base willhas or may fluctuate or decline in one or more markets or periods from time to time. IfThe people do not perceive our productssources and services to be useful, effective, reliable, and/or trustworthy, we may not be able to attract or retain members or otherwise maintain or increase the frequency and duration of their engagement or the percentage of members that are converted into paying subscribers. There is no guarantee that we will not experience an erosiondrivers of our member basegrowth may change over time, and growth in one geography, channel, or engagement levels. Member engagement can be difficult to measure, particularly as we introduce new and different products and services. Any number of factors can negatively affect member retention,segment growth,may engagementnot andoffset conversion,slower includinggrowth theor following,declines amongin others:another.
If people do not perceive our products and services to be useful, effective, reliable, and/or trustworthy, we may not be able to attract or retain members or otherwise maintain or increase the frequency and duration of their engagement or the percentage of members that are converted into paying subscribers. Any number of factors can negatively affect member retention, growth, engagement, and conversion, some of which are not in our control:
•members lose confidence in the quality or usefulness of our products or services or have concerns related to safety, security, privacy (for example, children’s data and precise geolocation data), well-beingwell-being, or other factors;
•members using the free version of the Life360 app do not convert, in part due to not perceivingperceive additional value in a paid subscription at all or at our pricing levels;
•members feel that their experience is diminished as a result of the decisions we make with respect to the frequency, prominence, format, sizesize, and quality of ads that we display;
•member experience is affected due to difficulty installing, updatingupdating, or otherwise accessing our products and services on mobile devices or hardware as a result of actions or unplanned network or site outages by us or third parties that we rely on to distribute our products and deliver our services;
•we fail to introduce new features, products or services that members find engaging, or if we introduce new products or services, or make changes to existing products and services, such as introducing advertisements, that are not favorably received;
•we fail to keep pace with evolving online, mobile device, market and industry trends (including the introduction of new and enhanced digital services), as well as prevailing social, culturalcultural, or political preferences in the markets in which our apps are available for download;
•initiatives designed to attract and retain members and increase engagement are unsuccessful or discontinued, whether as a result of actions by us, third parties or otherwise;
•we, our partners or companies in our industry adopt terms, policies, procedures or practices that are perceived negatively by our members or the general public, including those related to areas such as member data, including practices involving our collection and sharing of precise geolocation data and information collected from and about children and minors and their devices, privacy, security, or advertising;
•we fail to detect or combat inappropriate, fraudulent, criminalcriminal, or abusive activity on our platform;
•advertisers and partners display ads that are untrue, offensive, or otherwise fail to follow our guidelines; and
•we fail to provide adequate customer service to members, marketersmarketers, or other partners;partners.
•we fail to protect our brands or reputation;
•we, our partners or companies in our industry are or may become the subject of regulatory investigation and/or rulings of non-compliance, litigation, adverse media reports or other negative publicity, including as a result of our or their member data practices, such as the collection and sharing of precise geolocation data and/or information collected from and about children and minors and their devices;
•there is decreased engagement with our products and services as a result of internet shutdowns or other actions by governments that affect the accessibility of our products and services or our ability to sell advertising in any of our markets;
•there are changes mandated or necessitated by legislation, regulatory authorities or litigation that adversely affect our products, services, members or partners;
From time to time, certain of these factors have negatively affected member retention, growth, and engagement to varying degrees. If we are unable to maintain or increase our member base and member engagement, our revenue, business, financial condition and results of operations may be materially adversely affected. In addition, we may not experience rapid member growth or engagement in countries where, even though mobile device penetration is high, due to the lack of sufficient cellular-based data networks, consumers rely heavily on Wi-Fi and may not access our products and services regularly throughout the day. Any decrease in member retention, growth or engagement could render our products and services less attractive to members, which is likely to have a material and adverse impact on our revenue, financial condition, business and results of operations. If our member growth rate slows or declines, we will become increasingly dependent on our ability to maintain or increase levels of member engagement and monetization in order to drive revenue growth.
If we fail to monetize members through subscription plans, our business, financial conditioncondition, and results of operations may be harmed.
Life360 operates under a “freemium” model in which the Life360 app is available to members at no charge, while memberships with additional features are available via a paid monthly or annual subscription. If members using the free version of the Life360 app do not perceive additional value in a paid subscription or there is an actual or perceived reduction in the functionality, quality, reliabilityreliability, and cost-effectiveness of our subscription plans, our ability to retain and grow paid subscriptions would be adversely impacted. Our failure to provide successful enhancements and new features that grow paid subscriptions may have a material adverse impact on our business, financial conditioncondition, and results of operations.
If we are not able to maintain the value and reputation of our brands, or if we are not able to compete successfully with current or future competitors, our ability to expand our member base and maintain our relationships with partners and other key service providers may be impaired and our business, financial condition, and results of operations may be harmed.
We believe that our brands have significantly contributed to our word-of-mouth virality, which has in turn contributed to the success of our business. We also believe that maintaining, protectingprotecting, and enhancing our brands is critical to expanding our member base and maintaining our relationships with partners and other key service providers that will assist in successfully implementing our business strategy which we anticipate will increase our expenses. If we fail to do so, our business, financial conditioncondition, and results of operations could be materially adversely affected. We believe that the importance of brand recognition will continue to increase, as the location-based services and item tracking markets grow. Many of our new members are referred by existing members. Maintaining our brands will depend largely on our ability to continue to provide useful, reliable, trustworthytrustworthy, and innovative products and services, which will require us to make substantial investments and, if we mayfail notto do successfully.so, our business, financial condition, and results of operations could be materially adversely affected.
Further, we have in the past and expect to continue to experience media, legislative, or regulatory scrutiny of our actions or decisions, including those relating to data privacy and security, consumer protection, tracking, targeting children’s data, precise geolocation data, encryption, content, contributors, advertising and other issues, which may materially adversely affect our reputation and brands. We may be subject to settlements, judgments, fines, or other monetary penalties in connection with legal and regulatory developments that may be material to our business. In addition, we may fail to timely detect or respond expeditiously or appropriately to objectionable content or practices by members within the Life360, Tile or Jiobit apps, or to otherwise address member concerns, which could erode confidence in our brands. Maintaining and enhancing our brands will require us to make substantial investments and these investments may not be successful.
The digital consumer subscription products market is competitive, with low switching costs and a consistent stream of new products, servicesservices, and entrants. We may not be able to compete successfully with current or future competitors, which may impact our business, financial conditioncondition, and results of operations.
The digital consumer subscription products market in general, and the markets for family safety, location sharing, location tracking and related offerings, are fast-paced and constantly changing, with frequent changes in technology, consumer expectations and requirements, industry standards and regulations and a consistent stream of new products, servicesservices, and entrants both in the United StatesU.S. and abroad. New technology developments, including the development and use of artificial intelligence (“AI”) and other emerging technologies, are rapidly evolving. If our competitors gain an advantage by using such technologies, our ability to compete effectively and our results of operations could be adversely impacted. We face significant competition in every aspect of our business, and competitors include both large competitors with various product and service offerings and many smaller competitors.
Many of our current and potential competitors, both domestically and internationally, have or may have competitive advantages over us, including longer operating histories, significantly more resources (including larger marketing and operating budgets), greater brand recognition, access to more data and potential insights related to members, potential acquisition and other opportunities, higher amounts of available capital or access to such capital and in some cases, lower costs. Some of our competitors may enjoy better competitive positions in certain geographical regions, member demographicsdemographics, or other key areas that we currently serve or may serve in the future. These advantages could enable these competitors to offer products that are more appealing to our existing and prospective members, to respond more quickly and/or cost-effectively than us to new or changing opportunities and regulations, new or emerging technologies or changes in customer requirements and preferences, or to offer lower prices or free products and services. A competitor could gain rapid scale for its products by, among other things, leveraging its existing brands, products or services or existing data or insights, harnessing a new technology or a new or existing distribution channel or creating a new or different approach to family safety and location sharing of people, pets and things. For example, one of our third-party platform partners (each a “Channel Partner”), Apple, markets AirTag™, a tracker that uses ultra-wideband technology to allow its members to track and find items through Apple’s Find My® app, a location sharing app developed by Apple for iOS devices to allow approved Apple members to access the GPS location of their devices.
Management's Discussion & Analysis (MD&A)
New heading “Gain on Change in Fair Value of Investments”
New heading “Interest Income”
New heading “Interest Income”
Removed heading “Gain on Change in Fair Value of Investment”
Largest changes
“Growth and Monetization of Advertising Offerings. Advertising represents an additional revenue opportunity for our business, and our ability to grow and effectively monetize our advertising offerings will impact our operating results. Our success in this area will depend on our ability to successfully integrate acquired technology, operations, and personnel, scale advertiser demand, maintain advertiser relationships, and balance monetization opportunities with a positive member experience. …”see in full comparison
“Cost of hardware revenue increased by $4.0 million, or 8%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. This was driven by increases of $3.9 million in tariff costs due to increases in tariff rates and changes in product mix, and $0.5 million in product and other costs due to a 7% increase in net hardware units shipped. Additional increases include $2.5 million in personnel-related and stock-based compensation costs, attributable to Company growth. …”see in full comparison
“Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. …”see in full comparison
“For the year ended December 31, 2024, net cash used in investing activities was $10.1 million, which primarily related to the Related Party SAFE of $5.0 million, the capitalization of internally developed software costs of $3.9 million in accordance with ASC 350-40, Intangibles - Goodwill and Other, Internal-Use Software, and purchases of property and equipment of $1.2 million.”see in full comparison
Full comparison: every changed paragraph (105)
The following discussion and analysis of our financial condition and results of operations (MD&A) should be read in conjunction with our consolidated financial statements,statements and related notes and other financial information appearing elsewhere in this Annual Report on Form 10-K. In addition to historical consolidated financial information, the following discussion contains forward-looking statements based upon current plans, expectations, and beliefs that involve risks and uncertainties. Our actual results could differ materially from those discussed in the forward-looking statements as a result of a variety of factors, including but not limited to those discussed in “Item 1A. Risk Factors” and “Forward-Looking Statements” in this Annual Report on Form 10-K.
Life360 is a leading technology platform used to locate the people, petspets, and things that matter most to families. Life360 is creating a new category at the intersection of family, technology, and safety to help keep families connected and safe. Our core offering, the Life360 mobile application, includes features that range from communications to driving safety and location sharing. The Life360 mobile application operates under a “freemium” model where its core offering is available to members at no charge, with three membership subscription options that are available but not required. We also generate revenue through hardware subscription services and the sale of hardware tracking devices. By offering devices and integrated software to members, we have expanded our addressable market to provide members of all ages with a vertically integrated, cross-platform solution of scale. We also generate other revenue from partnerships, including through the placement of ads within our platform, and the sale of aggregated, non-personally identifiable data for data insight purposes.
•Gross profit of $279.2$380.8 million and $222.6$279.2 million, respectively, representing year-over-year growth of 25%36%; and
•Net income of $150.8 million and net loss of $4.6 millionmillion, respectively; and $28.2 million, respectively.
•Operating cash flows of $88.6 million and $32.6 million, respectively.
Ability to Retain Trusted Brand. We strongly believe in our vision to become the indispensable safety membership for families, with a suite of safety services that span every life stage of the family. Our business model and future success are dependent on the value and reputation of the Life360, JiobitLife360 and Tile by Life360, Inc. (“Tile”) brands. Our brand is trusted by approximately 8096 million members as of December 31, 2024,2025, and because we know the value of trust is immeasurable, we will continue to work tirelessly to provide useful, reliable, trustworthytrustworthy, and innovative products and services.
Attract, RetainRetain, and Convert Members. Our business model is based on attracting new members to our platform, converting free members to subscribers, and retaining and expanding subscriptions over time. Our continued success depends in part on our ability to offer compelling new products and features to our members, and to continue providing a quality user experience to convert and retain paying subscribers. We will also seek to increase brand awareness and customer adoption of our platform through various programs and digital and broad-scale advertising.
Ability to Attract New and Repeat Purchasers of Our Hardware Tracking Devices. Attracting new and repeat purchasers depends on our ability to design and release compelling smart trackers and market them effectively. Additionally we face increasing competition from better funded global companies. We pioneered the finding category and we continue to invest in the development of hardware productsproducts, assessing new and existing technologies with a priority on providing a great member finding experience.
Growth in Average Revenue Per Paying Circle. Our business model is dependent upon our ability to grow and maintain a large member base, including growing the number of Paying Circles. We have a sophisticated understanding of our members, and as a result, the services we provide are core to families and hard to switch. We continue to develop new monetization features leveraging our core technologies to offer additional services, expand into more stages of families and enter new verticals to increase adoption. Many factors will affect the Average Revenue per Paying Circle (“ARPPC”) including the number of Paying Circles, mix of monetization offerings on our platform, as well as demographic shifts and geographic differences across these variables.
Expanding the Offerings on Our Platform. We are continually evaluating new product offerings that are aligned with our core competencies and the needs of families across the life stage continuum. For example, our acquisition of Tile gave our members the ability to seamlessly leverage Bluetooth wireless technology enabled smart trackers, which can equip nearly any item—such as wallets, keys or remotes—with location-based finding technology. Likewise,In addition, the launch of our acquisitionLife360 Pet GPS trackers in October 2025 enables families to seamlessly monitor the location of Jiobit enabled subscribers to track family members and pets wearingdirectly Jiobit devices via GPS-enabled trackers onwithin the JiobitLife360 app.mobile application. We will continue to invest in and launch products where we see opportunities to grow our platform.
Seasonality. We experience seasonality in our member growth, engagement, Paying Circles growthgrowth, and monetization on our platform. Life360 has historically experienced member and subscription growth in the United StatesU.S. in the third quarter of each calendar year, driven by the back to school period for many of our members. Hardware sales have historically experienced comparatively higher seasonal growth in the fourth quarter of each calendar year, which includes the important selling periods in November (Black Friday and Cyber Monday) and December (Christmaslargely anddriven Hanukkah) in large part due to seasonalby holiday demand. As the majority of revenue is generated within the United States,U.S., our seasonality primarily relates to U.S. events. Accordingly, an unexpected decrease in sales over those traditionally high-volume selling periods may impact our revenue, result in surplus inventoryinventory, and could have a disproportionate effect on our operating results for the entire fiscal year. Seasonality in our business can also be affected by introductions of new or enhanced products and services, including the costs associated with such introductions.
International Expansion. We believe our global opportunity is significant, and to address this opportunity, we intend to continue to invest in sales and marketing effortsefforts, and infrastructureinfrastructure, and personnel to support our international expansion. Our growth will depend in part on the adoption and sales of our products and services in international markets.
Growth and Monetization of Advertising Offerings. Advertising represents an additional revenue opportunity for our business, and our ability to grow and effectively monetize our advertising offerings will impact our operating results. Our success in this area will depend on our ability to successfully integrate acquired technology, operations, and personnel, scale advertiser demand, maintain advertiser relationships, and balance monetization opportunities with a positive member experience. Advertising revenue may also be affected by macroeconomic conditions, changes in advertiser spending, competition, and evolving privacy and data protection regulations.
The following discussion describes certain line items in our Consolidatedconsolidated Statementsstatements of Operationsoperations and Comprehensivecomprehensive Loss.income (loss).
The Company currently operates as one reportable and operating segment because its chief operating decision maker (“CODM”), which is its Chief Executive Officer, reviews its financial information on a consolidated basis for purposes of making decisions regarding allocating resources and assessing performance. The Company has no segment managers who are held accountable by the CODM for operations, operating results, and planning for levels of components below the consolidated unit level.
We generate revenue primarily from sales of subscriptions on our platform, including Life360, JiobitLife360 and Tile. Revenue is recognized ratably over the related contractual term generally beginning on the date that our platform is made available to a customer. Our subscription agreements typically have monthly or annual contractual terms. Our agreements are generally non-cancellable during the contract term. We typically bill in advance for monthly and annual contracts. Amounts that have been billed are initially recorded as deferred revenue until the revenue is recognized.
We generate our hardware revenue from the sale of the Jiobit and Tile hardware tracking devices and related accessories. For hardware and accessories, revenue is recognized at the time products are delivered. We sell hardware tracking devices and accessories through a number of channels including our websites,website, brick and mortar retailretail, and online retail.
Other revenue consists of data and partnership revenue, which includes advertising revenue. We generate data revenue primarily through an arrangement with a key data partner that provides location-based analytics to customers in the retail and real estate sectors, municipalities, and other private and public organizations. The agreement permits commercialization of certain aggregated and de-identified data and provides for fixed and variable monthly revenue amounts. We generate partnership revenue through agreements with third parties which grant them access to anonymized data insights or advertising on the Company’s mobile platform.platform, and through the recognition of revenue related to a warrant to purchase common stock of a related party (“Related Party Warrant”).
Cost of subscription revenue primarily consists of expenses related to hosting our services and providing support to our free and paying subscribers. These expenses include personnel-related costs associated with our cloud-based infrastructure and our customer support organization, third-party hosting fees, software,software and maintenance costs, outside services associated with the delivery of our subscription services, amortization of acquired intangibles and allocated overhead, such as facilities, including rent, utilities, depreciation on equipment shared by all departments, credit card and transaction processing fees, and shared information technology costs. Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for operations personnel.
Cost of hardware revenue consists of product costs, including hardware production, contract manufacturers for production, shipping and handling, packaging, fulfillment, personnel-related expenses, manufacturing and equipment depreciation, warehousing, tariff costs, customer support costs, credit card and transaction processing fees, warranty replacement, and write-downs of excess and obsolete inventory.inventory, allocated overhead, such as facilities, including rent and utilities, and shared information technology costs. Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for operations personnel.
Cost of other revenue includes cloud-based hosting costs, assoftware welland astechnology costs, amortization of acquired intangibles, costs of product operations functionsfunctions, and personnel-related costs associated with our data and advertising platforms. Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for operations personnel.
Our gross profit has been, and may in the future be, influenced by several factors, including timing of capital expenditures and related depreciation expense, increases in infrastructure costs, component costs, tariffs, contract manufacturing and supplier pricing, and foreign currency exchange rates. Gross profit and gross profit margin may fluctuate over time based on the factors described above.
Our research and development expenses consist primarily of personnel-related costs for our engineering, product, and design teams, material costs of building and developing prototypes for new products, mobile app developmentdevelopment, and allocated overhead. We believe that continued investment in our platform is important for our growth. We intend to continue to invest in research and development to bring new customer experiences and devices to market and expand our platform capabilities.
Our sales and marketing expenses consist primarily of commissions to the Company’s third-party platforms (each a “Channel Partner”),Partners, personnel-related costs, brand marketing costs, lead generation costs, sales incentives, sponsorships andsponsorships, amortization of acquired intangibles, and bad debt expense.expense, and allocated overhead. Commission payments to Channel Partners in connection with annual subscription sales of the Company’s mobile application on third-party store platforms are considered to be incremental and recoverable costs of obtaining a contract with a customer and are expensed as incurred or deferred and typically amortized over an estimated period of benefit of two to three years depending on the subscription type.
Our general and administrative expenses consist primarily of employee-related costs for our legal, finance, human resources, and other administrative teams, as well as certain executive officers. In addition, general and administrative expenses include allocated overhead, outside legal, accounting and other professional fees, change in fair value of contingent consideration for business combinations, and non-income-based taxes. We expect our general and administrative expenses will increase in absolute dollars as our business grows.
Gain on Change in Fair Value of Investment
Gain on change in fair value of investment relates to the revaluation of a warrant held to purchase shares of preferred stock of a data revenue partner in connection with an observable price change.
Gain on settlement of the derivative liability relates to the conversion by the holders of the July 2021 Convertible Notes, which settled the embedded share-settled redemption features bifurcated from the Company’s July 2021 Convertible Notes.
Gain on settlement of derivative liability relates to the conversion by the holders of the July 2021 Convertible Notes, which settled the embedded share-settled redemption features bifurcated from the Company’s July 2021 Convertible Notes.
Gain on Change in Fair Value of Investments
The Company measures certain non-marketable equity securities and warrant investments at fair value on a nonrecurring basis in accordance with ASC 321, Investment - Equity Securities. In April 2025, the SAFE investment in a related party (the “Related Party SAFE”) converted into shares of preferred stock (the “Related Party Investment”), as a result of an observable price change. Additionally, the Company measures and reports certain assets at fair value each reporting period. In May 2025, the Company entered into a series of transactions with Aura Consolidated Group, Inc. (“Aura”), which included a convertible note investment by the Company into Aura (“Convertible Note Investment”). The Company elected to apply the fair value option in accordance with ASC 825, Financial Instruments.
Gain on change in fair value of investments relates to the change in fair value associated with the Convertible Note Investment and the observable price change upon the conversion of the Related Party SAFE into the Related Party Investment.
Interest Income
Interest income consists of interest earned on our cash and cash equivalents balances received from bank deposits and our investments in money market funds.
Other income (expense), net consists of interest income earned on our cash and cash equivalents balances, foreign currency exchange gains/(losses)/gains related to the remeasurement of certain assets and liabilities of our foreign subsidiaries that are denominated in currencies other than the functional currency of the subsidiary andsubsidiary, foreign exchange transactions gains/(losses), and interest expense primarily related to theconvertible Convertible Notes, and our U.S. IPO transaction costs.notes.
Provision for (benefit from) income taxes consists of U.S. federal and state income taxes and foreign income taxes in jurisdictions in which we conduct business. WeDeferred maintainincome ataxes fullreflect valuationthe allowancenet ontax oureffect federalof temporary differences between the carrying amount of assets and stateliabilities deferredfor financial reporting purposes and the amounts used for income tax assets as we have concluded that it is not more likely than not that the deferred tax assets will be realized.purposes.
The following tables set forth our consolidated statement of operations and comprehensive income (loss) for the years ended December 31, 2025, 2024, 2023, and 20222023 (in thousands, except percentages). We have derived this data from our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. This information should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. The results of historical periods are not necessarily indicative of the results of operations for any future period.
Subscription revenue increased $57.1$91.4 million, or 26%,33%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023,2024, primarily due to a26% 19%growth in Paying Circles and 17% growth in total subscriptions and a 25% growth in Paying Circles.subscriptions. Additionally, subscription revenue in the current period benefited from a 7% uplift in ARPPC. Please refer to the impact“Key Performance Indicators” section for definitions of pricekey increasesperformance forindicators existing U.S. Android Life360 subscriptions, which were fully implemented during the three months ended June 30, 2023.(“KPIs”).
Hardware revenue decreased $0.6$5.8 million, or 1%,10%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023,2024. primarilyAlthough duenet hardware units shipped increased 7%, contributing to a $4.6$6.3 million decreaseof inrevenue, retailthis sales driven by a delay in a new product launch, which led to lower sales volume. This declineincrease was partiallymore than offset by aan $4.0$8.5 million decreaseincrease in discounts and returns.a $3.6 million reduction in revenue related to bundled offerings.
Other revenue increased $10.5$32.4 million, or 41%,90%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023,2024. This was primarily due to a $5.5$26.3 million increase in partnership revenue, which includes advertising revenue, and areflects $5.0 million increasegrowth in advertising activity from both existing arrangements and an increased number of partners. In addition, data revenue,revenue whichincreased was$6.1 million, primarily attributable to the Amended and Restated Data Services and License Agreement with Placer.ai we entered into in July 20242024, (theand “A&Rincreased Placerdata Agreement”).volumes resulting from user growth.
Cost of subscription revenue increased $10.0 million, or 32%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023, primarily related to increases of $4.0 million in technology expenses, $1.9 million in costs related to premium membership offerings, and $1.8 million benefit related to the discontinuation of certain battery related membership benefits recognized in 2023. The Company also saw increases of $1.8 million in personnel-related and stock-based compensation costs and $0.5 million in other cost of subscription revenue expenses, attributable to Company growth.
Subscription gross margin decreased to 85% during the year ended December 31, 2024 from 86% during the year ended December 31, 2023, primarily due to the discontinuation of certain battery-related membership benefits that positively impacted 2023.
Cost of hardware revenue decreased by $0.2 million, remaining relatively flat during the year ended December 31, 2024 as compared to the year ended December 31, 2023, primarily due to a decrease of $1.2 million in hardware product costs related to the reduced number of units sold and $0.7 million in costs related to the discontinuation of certain battery related membership benefits which took place in 2023. These decreases were partially offset by an increase of $1.1 million in hardware freight costs related to a shift in channel mix and $0.6 million in other fixed costs attributable to Company growth.
Hardware gross margin decreased to 18% during the year ended December 31, 2024 from 19% during the year ended December 31, 2023, primarily due to an increase in freight costs associated with the shift in channel mix, a decrease in units sold, and an increase in fixed hardware costs in line with Company growth.
Cost of othersubscription revenue increased by $0.6$10.0 million, or 16%,24%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023,2024, primarily due to an increaseincreases of $0.3$4.1 million in personnel-related and stock-based compensation costs, $3.1 million in technology relatedexpenses, expenses to support the existing customer base and $0.3$2.6 million in otheramortization of internally developed software related to the release of new features and significant updates on our platform, all attributable to Company growth, and $0.2 million in costs associated with thepremium growthmembership in partnership revenue, which includes advertising revenue.offerings.
Subscription gross margin increased to 86% during the year ended December 31, 2025 from 85% during the year ended December 31, 2024, primarily due to price increases for new and existing Life360 subscriptions implemented during the second half of 2024 and continuing into 2025, consistent with the increase in ARPPC. Subscription gross margin also benefited from ongoing technology efficiency initiatives implemented by the Company. Please refer to “Key Performance Indicators” for definitions of KPIs.
Cost of hardware revenue increased by $4.0 million, or 8%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. This was driven by increases of $3.9 million in tariff costs due to increases in tariff rates and changes in product mix, and $0.5 million in product and other costs due to a 7% increase in net hardware units shipped. Additional increases include $2.5 million in personnel-related and stock-based compensation costs, attributable to Company growth. The increases were partially offset by decreases of $1.7 million in freight costs and $1.2 million in fulfillment costs, both related to a shift in channel mix.
OtherHardware gross margin increaseddecreased to 89%1% during the year ended December 31, 20242025 from 86%18% during the year ended December 31, 2023,2024, primarily due to revenue outpacing thean increase in discounts and tariff costs.
Cost of other revenue increased by $2.4 million, or 59%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024, due to an increase of $2.4 million in technology and other related expenses.
Other gross margin increased to 91% during the year ended December 31, 2025 from 89% during the year ended December 31, 2024, primarily due to revenue outpacing the increase in costs.
Research and development expenses increased $12.1$15.3 million, or 12%,14%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023.2024. This was primarily due to increases of $11.5$13.2 million in personnel-related and stock-based compensation costs, $4.1 million in technology and other expenses, $2.3 million in contractor spend, and $0.3$0.9 million in professional and outside services, all attributable to Company growth. The increases were partially offset by a $4.3 million increase inhigher capitalized costs relatedof to internal use software, a $0.9$2.2 million increasefor internally developed software related to a raw material inventory write-off which negatively impacted the yeardevelopment endedof Decembernew 31, 2023,features and asignificant $0.9updates millionto increaseour inplatform, and higher capitalized construction in progress costs.costs of $0.7 million, in line with our product development roadmap.
Sales and marketing expenses increased $14.3$41.6 million, or 14%,37%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023.2024. This was primarily due to increases of $10.2$16.8 million in commissions to the Company’s Channel Partners, whichin was inlineline with the 19% growthincrease in subscriptions,subscription $6.6revenue, and $14.4 million in othergrowth marketingmedia spend,spend $1.6to support strategic initiatives. Additional increases include $7.9 million in personnel-related and stock-based compensation costs, $0.7$1.3 million in marketing and other spend related to production and public relations, and $1.2 million in technology and other expenses, and $0.4 million in professional and outside services,all attributable to Company growth. The increases were partially offset by a $4.2 million decrease in paid user acquisition costs due to planned shifts in the allocation of spend to other marketing and a $1.0 million decrease in contractor spend.
General and administrative expenseexpenses increased $8.1$17.9 million, or 15%,30%, during the year ended December 31, 20242025 as compared to the year ended December 31, 2023.2024. This was primarily due to increases of $3.6$12.2 million in personnel-related and stock-based compensation costs andcosts, $1.0 million in technology expenses, and $0.7 million in insurance and other costs, all attributable to Company growth. InAdditional addition,increases theinclude Company saw a $3.5$2.0 million increase in professional and outside serviceservices costsspend, primarily driven by public company compliancetransaction costs inincurred connectionrelated withto acquisitions, $1.3 million for travel and entertainment costs primarily related to the U.S.Company’s IPO,annual ongoing public company compliance costs,event, and corporate$0.7 andmillion strategicin matters.warehouse relocation costs related to the move of certain hardware manufacturing operations.
In April and June 2024, the September 2021 Convertible Notes and the July 2021 Convertible Notes, respectively, were converted to common stock. As a result, the Company recorded no gain or loss associated with the Convertible Notes fair value adjustment for the year ended December 31, 2025. The Company recorded a $0.6 million loss associated with the Convertible Notes fair value adjustment for the year ended December 31, 2024.
For the years ended December 31, 2024 and 2023, the Company recorded losses associated with the convertible notes fair value adjustment of $0.6 million and $0.7 million, respectively. The changes in fair value were primarily driven by the share price volatility and reduction in time to convert.
In June 2024, the holders of the July 2021 Convertible Notes converted their notes and accrued interest to common stock and the embedded derivative liability was settled as a result of the conversion. As a result, the Company recorded no gain or loss and a $1.7 million loss associated with the derivative liability fair value adjustment for the years ended December 31, 2025 and 2024, respectively.
For the years ended December 31, 2024 and 2023, the Company recorded losses associated with the derivative liability fair value adjustment of $1.7 million and $0.1 million, respectively. The changes were due to the revaluation of the derivative liability at each reporting period and are related to embedded redemption features bifurcated from the July 2021 Convertible Notes issued to investors.
In April and June 2024, the September 2021 Convertible Notes and the July 2021 Convertible Notes, respectively, were converted to common stock. AAs a result, the Company recorded no gain or loss related to the settlement of the September 2021 Convertible Notes and July 2021 Convertible Notes for the year ended December 31, 2025. The Company recorded a $0.4 million loss associated with the settlement of the July 2021 Convertible Notes wasand recordedthe September 2021 Convertible Notes for the year ended December 31, 2024. There were no such transactions during the year ended December 31, 2023.
In June 2024, the holders of the July 2021 Convertible Notes converted their notes and accrued interest to common stock and the derivative liability was settled as a result of the conversion. AAs a result, the Company recorded no gain ofor $1.9loss millionrelated associated withto the settlement of the derivative liability wasfor the year ended December 31, 2025. The Company recorded a $1.9 million gain related to the settlement of the derivative liability upon conversion of the July 2021 Convertible Notes for the year ended December 31, 2024. There were no such transactions during the year ended December 31, 2023.
In April 2025, an observable price change related to the conversion of the Related Party SAFE into the Related Party Investment took place. As a result, a $0.9 million gain related to the observable price change was recognized during the year ended December 31, 2025.
What changed in the latest 10-Q
Risk Factors
New heading “Risks Related to Our Common Stock and CDIs”
New heading “The market price of our CDIs and common stock has been, and may in the future be, volatile, or may decline regardless of our operating performance and you could lose all or part of your investment.”
Largest changes
“The stock market has in the past experienced extreme price and volume fluctuations, and, following periods of such volatility in the overall market and the market price of a company’s securities, securities class action litigation has often been instituted against these companies. Such litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources, which would harm our business, operating results, or financial condition.”see in full comparison
“The market price of our CDIs and common stock has been, and may in the future be, volatile, or may decline regardless of our operating performance and you could lose all or part of your investment.”see in full comparison
“Our common stock is currently listed on Nasdaq and our CDIs are currently listed on the ASX. Trading in our common stock and CDIs therefore takes place in different currencies (U.S. dollars on the Nasdaq and Australian dollars on the ASX), and at different times (resulting from different time zones, different trading days and different public holidays in the U.S. and Australia). The trading prices of our common stock and our CDIs on two markets may differ as a result of these, or other, factors. …”see in full comparison
“The trading price of our CDIs on the ASX and of our common stock on the Nasdaq Global Select Market (“Nasdaq”) has been and may continue to be volatile, and could be subject to wide fluctuations. In addition, the trading volume in our CDIs and common stock has in the past and may in the future fluctuate and cause significant price variations to occur. …”see in full comparison
“With respect to our share repurchase program, there is no guarantee that the program will be fully consummated or that it will enhance long-term stockholder value, and repurchases under the program could increase the volatility of the trading price of our common stock or CDIs, or negatively impact our cash reserves. Repurchases under the program, and any Company Rule 10b5-1 trading plan, may be modified, suspended, or discontinued without prior notice.”see in full comparison
Full comparison: every changed paragraph (22)
ThereExcept as set forth below, there have been no material changes from the risk factors set forth under the heading “Risk Factors” in Part I, Item 1A in our Annual Report. An investment in shares of our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described in our Annual Report, together with all of the other information in the Annual Report, together with the other information appearing elsewhere in this Quarterly Report, including our unaudited condensed consolidated financial statements and related notes hereto, and any other documents that we file with the SEC before deciding to invest in our common stock. The occurrence of any of the following risks or of those described in our Annual Report could have a material adverse effect on our business, financial condition, results of operations, and future growth prospects or cause our actual results to differ materially from those contained in forward-looking statements we have made in this report and those we may make from time to time. In these circumstances, the market price of our common stock could decline; and you may lose all or part of your investment. We cannot assure you that any of the events discussed in our Annual Report will not occur.
Risks Related to Our Common Stock and CDIs
The market price of our CDIs and common stock has been, and may in the future be, volatile, or may decline regardless of our operating performance and you could lose all or part of your investment.
The trading price of our CDIs on the ASX and of our common stock on the Nasdaq Global Select Market (“Nasdaq”) has been and may continue to be volatile, and could be subject to wide fluctuations. In addition, the trading volume in our CDIs and common stock has in the past and may in the future fluctuate and cause significant price variations to occur. Securities markets worldwide experience significant price and volume fluctuations as a result of a variety of factors, many of which are beyond our control but may nonetheless decrease the market price of our CDIs and common stock, regardless of our actual operating performance, including:
•public reaction to our press releases, announcements, and filings with the SEC and ASX;
•our operating and financial performance;
•fluctuations in market prices and trading volumes of technology;
•changes in market valuations of similar companies;
•departures of key personnel;
•commencement of or involvement in litigation;
•changes in economic and political conditions, financial markets, and/or the technology industry;
•interest rate fluctuations;
•changes in accounting standards, policies, guidance, interpretations, or principles;
•actions by our securityholders;
•the failure of securities analysts to cover our common stock and/or changes in their recommendations and estimates of our financial performance;
•future sales of our common stock;
•the timing, price, and volume of repurchases under our share repurchase program, or any determination to suspend, modify, or discontinue the program;
•trading prices and trading volumes of our CDIs on the ASX and our common stock on the Nasdaq; and
•the other factors described in these “Risk Factors”.
The stock market has in the past experienced extreme price and volume fluctuations, and, following periods of such volatility in the overall market and the market price of a company’s securities, securities class action litigation has often been instituted against these companies. Such litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources, which would harm our business, operating results, or financial condition.
Our common stock is currently listed on Nasdaq and our CDIs are currently listed on the ASX. Trading in our common stock and CDIs therefore takes place in different currencies (U.S. dollars on the Nasdaq and Australian dollars on the ASX), and at different times (resulting from different time zones, different trading days and different public holidays in the U.S. and Australia). The trading prices of our common stock and our CDIs on two markets may differ as a result of these, or other, factors. Any decrease in the price of our common stock or CDIs on either market could cause a decrease in the trading prices of our CDIs or our common stock on the other market. In addition, investors may seek to profit by exploiting the difference, if any, between the price of our common stock on Nasdaq and the price of our CDIs on the ASX. Such arbitrage activities could cause our stock price in the market with the higher value to decrease to the price set by the market with the lower value and could also lead to significant volatility in the price of our common stock or CDIs.
With respect to our share repurchase program, there is no guarantee that the program will be fully consummated or that it will enhance long-term stockholder value, and repurchases under the program could increase the volatility of the trading price of our common stock or CDIs, or negatively impact our cash reserves. Repurchases under the program, and any Company Rule 10b5-1 trading plan, may be modified, suspended, or discontinued without prior notice.
Management's Discussion & Analysis (MD&A)
New heading “Share Repurchase Program”
Largest changes
“Research and development expenses increased $24.0 million, or 38%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to increases of $12.9 million in personnel-related and stock-based compensation costs, including those related to the acquisition of Nativo, and a $5.8 million increase in technology and other expenses due to Company growth. …”see in full comparison
Cost of hardware revenuesee in full comparisonremaineddecreasedflat$4.6 million, or 45%, during the three months endedMarchJune31,30, 2026 as compared to the three months endedMarchJune31,30,2025.2025,Althoughprimarilyweduesawto adecline$3.6 million benefit from the receipt of tariff refund claims and a $0.5 million decrease innettariffunitscostsshipped,from reduced tariff rates. Also contributing were decreases of $0.4 million, in personnel-related and stock-based compensation costs due to lower headcount, and $0.4 million in hardware product costsincreased $0.6 million duerelated toatheshiftreducedinnumberproductofmix.units sold. Theseincreaseswere partially offset by a$0.6$0.3 milliondecreaseincrease ininventory reserves andothercostscostprimarilyof hardware revenue relatedto the strategic exit of the brick-and-mortar retail channel.expenses.
Research and development expenses increasedsee in full comparison$8.9$15.1 million, or29%,47%, during the three months endedMarchJune31,30, 2026 as compared to the three months endedMarchJune31,30, 2025, primarily due toincreasesaof $6.4$6.5 million increase in personnel-related and stock-based compensation costs, including those related to the acquisition of Nativo,$1.3and a $4.5 million increase in technology and otherexpenses,expensesanddue$0.9to Company growth. Also contributing were $1.7 million in workplace restructuring costs associated with the Company’s transition to an AI-Native organization, $1.0 million of lower capitalized internally developed software costs, a $0.6 million increase in professional and outsideservices. Additionally,services, a$0.8$0.5 million decrease in capitalized construction in progress costs, in line withourthe Company’s product development roadmap,contributedandto the increase. These increases were partially offset by $0.5$0.3 million ofhigherNativocapitalizedintegrationinternally developed software costs related to the development of new features and significant updates to our platform.costs.
“For the three months ended March 31, 2026, net cash provided by financing activities was $3.4 million, which is primarily driven by $12.2 million of proceeds related to tax withholdings on restricted stock settlements and the exercise of stock options and warrants and $2.3 million of proceeds from the monetization of tariff refund claims. The cash proceeds were partially offset by $10.3 million of taxes paid for the net settlement of equity awards and the $0.7 million deferred purchase price payment related to the Fantix acquisition.”see in full comparison
“Cost of hardware revenue decreased by $4.6 million, or 25%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to a $3.6 million benefit from the receipt of tariff refund claims and a $0.3 million decrease in tariff costs from reduced tariff rates. Also contributing were decreases of $0.4 million in hardware product and freight costs, related to the reduced number of units sold, and $0.3 million in personnel-related and stock-based compensation costs due to lower headcount.”see in full comparison
“Other income (expense), net decreased $4.0 million, or 396%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. This was primarily driven by a $1.5 million increase in foreign exchange losses, a $1.3 million loss related to the monetization of tariff refunds, a $0.9 million increase in interest expense related to the June 2025 Convertible Notes, and a $0.3 million increase in interest expense related to the deferred purchase price liability from the acquisition of Nativo.”see in full comparison
Full comparison: every changed paragraph (81)
We believe that our results of operations are affected by a number of factors, such as: the ability to remain a trusted brand; attracting, retaining, and converting members; maintaining efficient member acquisition; the ability to attract new and repeat purchasers of our hardware tracking devices; growth in Average Revenue per Paying Circle (“ARPPC”); expanding the offerings on our platform; attracting and retaining talent; seasonality; international expansion; and growth and monetization of advertising offerings. We discuss each of these factors in more detail under the heading “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Factors Affecting Our Performance” in our Annual Report. While we do not have control of all factors affecting our results fromof operations, we work diligently to influence and manage those factors which we can impact to enhance our results of operations.
Our general and administrative expenses consist primarily of employee-related costs for our legal, finance, human resources, and other administrative teams, as well as certain executive officers. In addition, general and administrative expenses include allocated overhead, outside legal, accountingaccounting, and other professional fees, and non-income-based taxes. We expect general and administrative expenses will increase in absolute dollars as our business grows.
LossGain (loss) on Change in Fair Value of InvestmentInvestments
The Company measures certain non-marketable equity securities and warrant investments at fair value on a nonrecurring basis in accordance with ASC 321, Investment - Equity Securities. In April 2025, the SAFE investment in a related party (the “Related Party SAFE”) converted into shares of preferred stock (the “Related Party Investment”), as a result of an observable price change. Additionally, the Company measures and reports certain assets at fair value each reporting period.
In May 2025, we entered into a series of transactions with Aura Consolidated Group, Inc. (“Aura”), which included a convertible note investment into Aura (“Convertible Note Investment”). We elected to apply the fair value option in accordance with ASC 825, Financial Instruments and as a result, the Loss on change in fair value of investment relates to the change in fair value associated with the Convertible Note Investment.Instruments.
Gain (loss) on change in fair value of investments relates to the change in fair value associated with the Convertible Note Investment and the observable price change upon the conversion of the Related Party SAFE into the Related Party Investment.
Interest income consists of interest earned on our cash and cash equivalents balances received from bank deposits, money market funds, and short-term investments.investments, as well as the amortization of discounts on our short-term investments and cash equivalents.
Other income (expense), net consists of foreign currency exchange gains/(losses) related to the remeasurement of certain assets and liabilities of our foreign subsidiaries that are denominated in currencies other than the functional currency of the subsidiary, foreign exchange transactionstransaction gains/(losses), and interest expense primarily related to convertible notes and the deferred purchase price liability related to the acquisition of Nativo, Inc. (“Nativo”)., and a loss related to the monetization of tariff refund claims.
The following tables set forth our condensed consolidated statements of operations and comprehensive income for the three and six months ended MarchJune 31,30, 2026 and 2025 (in thousands, except percentages).
Subscription revenue increased $26.3$27.1 million, or 32%,31%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, primarily due to a 27% growth in Paying Circles and 17%an 18% growth in total subscriptions. Additionally, subscription revenue in the current period benefited from a 7%5% uplift in ARPPC. Please refer to the “Key Performance Indicators” section for definitions of key performance indicators (“KPIs”).
Hardware revenue decreased $4.4 million, or 49%, during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. The decline was primarily driven by a 25% decrease in Net hardware units shipped, contributing to a $1.2 million decrease in hardware revenue. This decrease was also impacted by a $1.9 million increase in discounts and a $0.9 million increase in returns, of which $1.0 million and $0.5 million, respectively, were directly attributable to the strategic exit of the brick-and-mortar retail channel, and a $0.4 million reduction in revenue related to bundled offerings.
Advertising revenue increased $15.1 million, or 329%, during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. This was primarily driven by a $12.6 million increase in managed advertising revenue and a $2.5 million increase in other advertising revenue, both primarily attributable to the acquisition of Nativo. We expect advertising revenue to grow as we continue to integrate Nativo's platform, expand advertiser relationships, and increase advertising inventory across the Life360 platform.
OtherHardware revenue increaseddecreased $2.5 million, or 30%,20%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025. ThisThe decline was due to a $2.0 million increase in data revenue, which was primarily attributable to increased data volumes resulting from user growth, and a $0.5 million increase in partnership revenue, primarily driven by higher revenue share from an existing18% partner.decrease in Net hardware units shipped.
Advertising revenue increased $16.7 million, or 315%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. This was primarily driven by a $14.1 million increase in managed advertising, a $1.3 million increase in self-service advertising, a $0.7 million increase in programmatic advertising, and a $0.6 million increase in other advertising revenue, primarily attributable to the acquisition of Nativo. We expect advertising revenue to grow as we continue to integrate Nativo's platform, expand advertiser relationships, and increase advertising inventory across the Life360 platform.
Other revenue increased $2.3 million, or 25%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. This was due to a $1.6 million increase in data revenue, which was primarily attributable to increased data volumes resulting from user growth, and a $0.7 million increase in partnership revenue, primarily driven by higher revenue share from an existing partner.
Subscription revenue increased $53.4 million, or 31%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily driven by a 27% growth in Paying Circles and 18% growth in total subscriptions. Additionally, subscription revenue in the current period benefited from a 6% uplift in ARPPC.
Hardware revenue decreased $6.8 million, or 32%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The decline was primarily driven by a 21% decrease in Net hardware units shipped, contributing to a $3.8 million decrease in hardware revenue. This decrease was also impacted by a $2.5 million increase in discounts, of which $1.0 million was directly attributable to the strategic exit of the brick-and-mortar retail channel, and a $0.5 million reduction in revenue related to bundled offerings.
Advertising revenue increased $31.8 million, or 322%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. This was primarily driven by a $26.7 million increase in managed advertising, primarily attributable to the acquisition of Nativo as well as an increase in spending from existing advertisers. Also attributable to the acquisition of Nativo, there was a $2.2 million increase in self-service advertising, a $2.2 million increase in other advertising revenue, and a $0.7 million increase in programmatic advertising. We expect advertising revenue to grow as we continue to integrate Nativo's platform, expand advertiser relationships, and increase advertising inventory across the Life360 platform.
Other revenue increased $4.8 million, or 27%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, due to a $3.6 million increase in data revenue, which was primarily attributable to increased data volumes resulting from user growth, and a $1.2 million increase in partnership revenue, primarily driven by higher revenue share from an existing partner.
Cost of subscription revenue increased $4.4$2.2 million, or 43%,17%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, primarily due to increases of $1.9$1.4 million in technology expenses, $1.3 million in personnel-relatedexpenses and stock-based compensation costs, and $0.2$0.3 million in amortization of internally developed software related to the release of new features and significant updates on our platform, allboth attributable to Company growth. In addition, costs associated with premium membership offerings increased $1.0$0.9 million. These increases were partially offset by a $0.4 million decrease in personnel-related and stock-based compensation costs.
Subscription gross margin decreasedincreased to 87% during the three months ended MarchJune 31,30, 2026 from 88%85% during the three months ended MarchJune 31,30, 2025, primarily due to highera personnelshift costsin attributableproduct tomix Companytoward growth.higher-priced offerings and price increases across select international markets throughout the second half of 2025.
Cost of hardware revenue remaineddecreased flat$4.6 million, or 45%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025.2025, Althoughprimarily wedue sawto a decline$3.6 million benefit from the receipt of tariff refund claims and a $0.5 million decrease in nettariff unitscosts shipped,from reduced tariff rates. Also contributing were decreases of $0.4 million, in personnel-related and stock-based compensation costs due to lower headcount, and $0.4 million in hardware product costs increased $0.6 million duerelated to athe shiftreduced innumber productof mix.units sold. These increases were partially offset by a $0.6$0.3 million decreaseincrease in inventory reserves and other costscost primarilyof hardware revenue related to the strategic exit of the brick-and-mortar retail channel.expenses.
Hardware gross margin decreasedincreased to (91)%43% during the three months ended MarchJune 31,30, 2026 from 3%17% during the three months ended MarchJune 31,30, 2025, primarily due to anthe increasebenefit infrom discountsthe receipt of tariff refund claims and returnsreduced largelytariff attributable to the Company's strategic exit from brick-and-mortar retail channel, as well as changes in product mix.costs. We continue to prioritize hardware as a driver of subscription growth by optimizing pricing and bundling to increase subscription attachment over standalone hardware margin.
Cost of advertising revenue increased $7.7$9.0 million, or 2,929%,1,744%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily drivendue byto increases of $2.6$3.6 million in traffic acquisition costs, $2.5$2.6 million in technology and hosting costs, $1.4$1.5 million in personnel-related and stock-based compensation costs, $0.7$0.9 million in third-party data and content licensing costs, and $0.5$0.4 million in amortization of acquired technology, all attributable to the acquisition of Nativo.
Advertising gross margin decreased to 60%57% during the three months ended MarchJune 31,30, 2026 from 94%90% during the three months ended MarchJune 31,30, 2025, primarily due to higher costs associated with our expanded advertising platform following the acquisition of Nativo, which outpaced the growth in total advertising revenue. The acquisition of Nativo has expanded the Company's advertising capabilities, resulting in a shift in margin mix relative to our existing advertising offerings.
Cost of other revenue increased $0.4$0.6 million, or 39%,55%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, due to an increase of $0.4$0.6 million in technology and other related expenses to support the existing customer base.
Other gross margin decreased to 86%85% during the three months ended MarchJune 31,30, 2026 from 87%88% during the three months ended MarchJune 31,30, 2025, primarily due to higher technology costs outpacingsupporting revenuegrowth growth.in our data business.
Cost of subscription revenue increased $6.6 million, or 28%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to increases of $3.4 million in technology expenses, $0.8 million in personnel-related and stock-based compensation costs, and $0.5 million in amortization of internally developed software related to the release of new features and significant updates on our platform, all attributable to Company growth. In addition, costs associated with premium membership offerings increased $1.9 million.
Subscription gross margin increased to 87% during the six months ended June 30, 2026 from 86% during the six months ended June 30, 2025, primarily due to a shift in product mix toward higher-priced offerings and price increases across select international markets throughout the second half of 2025.
Cost of hardware revenue decreased by $4.6 million, or 25%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to a $3.6 million benefit from the receipt of tariff refund claims and a $0.3 million decrease in tariff costs from reduced tariff rates. Also contributing were decreases of $0.4 million in hardware product and freight costs, related to the reduced number of units sold, and $0.3 million in personnel-related and stock-based compensation costs due to lower headcount.
Hardware gross margin decreased to 1% during the six months ended June 30, 2026 from 11% during the six months ended June 30, 2025, as the decline in hardware revenue from the Company’s strategic exit of the brick-and-mortar retail channel outpaced the benefit to cost of hardware revenue from tariff refund claims and lower tariff costs.
Cost of advertising revenue increased $16.7 million, or 2,143%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The increase was primarily due to increases of $6.2 million in traffic acquisition costs, $5.3 million in technology and hosting costs, $3.1 million in personnel-related and stock-based compensation costs, $1.3 million in third-party data and content licensing costs, and $0.8 million in amortization of acquired technology, all attributable to the acquisition of Nativo.
Advertising gross margin decreased to 58% during the six months ended June 30, 2026 from 92% during the six months ended June 30, 2025, primarily due to higher costs associated with our expanded advertising platform following the acquisition of Nativo, resulting in a shift in margin mix relative to our existing advertising offerings.
Cost of other revenue increased $1.0 million, or 47%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, due to increases of $1.0 million in technology and other related expenses to support the existing customer base.
Other gross margin decreased to 85% during the six months ended June 30, 2026 from 87% during the six months ended June 30, 2025, primarily due to higher technology costs supporting growth in our data business.
Research and development expenses increased $8.9$15.1 million, or 29%,47%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, primarily due to increasesa of $6.4$6.5 million increase in personnel-related and stock-based compensation costs, including those related to the acquisition of Nativo, $1.3and a $4.5 million increase in technology and other expenses,expenses anddue $0.9to Company growth. Also contributing were $1.7 million in workplace restructuring costs associated with the Company’s transition to an AI-Native organization, $1.0 million of lower capitalized internally developed software costs, a $0.6 million increase in professional and outside services. Additionally,services, a $0.8$0.5 million decrease in capitalized construction in progress costs, in line with ourthe Company’s product development roadmap, contributedand to the increase. These increases were partially offset by $0.5$0.3 million of higherNativo capitalizedintegration internally developed software costs related to the development of new features and significant updates to our platform.costs.
Research and development expenses increased $24.0 million, or 38%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to increases of $12.9 million in personnel-related and stock-based compensation costs, including those related to the acquisition of Nativo, and a $5.8 million increase in technology and other expenses due to Company growth. Also contributing were $1.7 million in workplace restructuring costs associated with the Company’s transition to an AI-Native organization, a $1.6 million increase in professional and outside services, a $1.3 million decrease in capitalized construction in progress costs, in line with the Company’s product development roadmap, $0.4 million of lower capitalized internally developed software costs, and $0.3 million of Nativo integration costs.
Sales and marketing expenses increased $21.7$13.4 million, or 62%,35%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025. This was primarily due to increases of $7.8 million in growth media and other marketing spend to support strategic initiatives, and $5.1 million in commissions to the Company’s Channel Partners, in line with the increase in subscription revenue. The increase was also driven by $5.1$6.3 million in personnel-related and stock-based compensation costs and $1.8 million in amortization of acquired intangible assets, each primarily attributable to the acquisition of Nativo. Additional increases include $0.9$5.0 million in commissions to the Company’s Channel Partners, in line with the increase in subscription revenue, and $1.2 million in technology and other expensesexpenses, attributable to Company growth,growth. $0.6These increases were partially offset by a $0.9 million decrease in Nativogrowth integration costs,media and $0.4other million in severancemarketing costs relateddue to the strategicplanned exittiming of the brick-and-mortar retail channel.spend.
Sales and marketing expenses increased $35.2 million, or 47%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. This was primarily due to increases of $11.1 million in personnel-related and stock-based compensation costs and $3.5 million in amortization of acquired intangible assets, each primarily attributable to the acquisition of Nativo. Additional increases include $9.9 million in commissions to the Company’s Channel Partners, in line with the increase in subscription revenue, $7.5 million in growth media and other marketing spend to support strategic initiatives, $2.2 million in technology and other expenses attributable to Company growth, $0.6 million in Nativo integration costs, and $0.4 million in severance costs related to the strategic exit of the brick-and-mortar retail channel.
General and administrative expenses increased $6.7$9.9 million, or 43%,57%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025. This was primarily due to increases of $5.8$7.5 million in personnel-related and stock-based compensation costs and $0.7$1.1 million in technology and other expenses, both attributable to Company growth. Additional increases include $0.6 million in warehouse relocation costs related to the move of certain hardware manufacturing operationsoperations, $0.5 million in professional and $0.5outside services, and $0.2 million in Nativo integration costs. These increases were partially offset by a $0.9 million decrease in professional and outside services.
General and administrative expenses increased $16.6 million, or 50%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. This was primarily due to increases of $12.9 million in personnel-related and stock-based compensation costs and $1.8 million in technology and other expenses, both attributable to Company growth. Additional increases include $1.2 million in warehouse relocation costs related to the move of certain hardware manufacturing operations, and $0.7 million in Nativo integration costs.
LossGain (loss) on Change in Fair Value of InvestmentInvestments
In April 2025, an observable price change related to the conversion of the Related Party SAFE into the Related Party Investment took place. As a result, a $0.9 million gain related to the observable price change was recognized during the three and six months ended June 30, 2025. No such transaction occurred during the three and six months ended June 30, 2026.
In May 2025, the Company entered into a series of transactions with Aura, which included the $25.0 million Convertible Note Investment. The Company elected to apply the fair value option in accordance with ASC 825, Financial Instruments. As a result, a $3.9 million loss related to the revaluation of the Convertible Note Investment of $0.9 million and $4.7 million was recognized during the three and six months ended MarchJune 31,30, 2026.2026, respectively, compared to a gain of $0.4 million for both the three and six months ended June 30, 2025.
Interest income increased $2.0$1.6 million, or 114%,64%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, resulting from higher average gross yields attributableand tohigher amortization of discounts on increased cash and cash equivalents and short-term investment balances.
Interest income increased $3.7 million, or 85%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, resulting from higher average gross yields and higher amortization of discounts on increased cash and cash equivalents and short-term investment balances.
Other income (expense), net decreased $1.0$3.0 million, or 515%,368%, during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025. This was primarily driven by a $0.5$1.3 million loss related to the monetization of tariff refunds, a $1.1 million increase in foreign exchange losses, a $0.4 million increase in interest expense related to the June 2025 Convertible Notes, a $0.3 million increase in foreign exchange losses, and a $0.2 million increase in interest expense related to the deferred purchase price liability from the acquisition of Nativo. Refer to Note 7, "Business Combinations" and Note 8, "Balance Sheet Components" for additional information on the acquisition of Nativo and the related deferred purchase price liability.
Other income (expense), net decreased $4.0 million, or 396%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. This was primarily driven by a $1.5 million increase in foreign exchange losses, a $1.3 million loss related to the monetization of tariff refunds, a $0.9 million increase in interest expense related to the June 2025 Convertible Notes, and a $0.3 million increase in interest expense related to the deferred purchase price liability from the acquisition of Nativo.
Benefit from income taxes increased $11.5$3.6 million during the three months ended MarchJune 31,30, 20262026, as compared to the three months ended MarchJune 31,30, 2025, primarily due to changes in the Company’sCompany's annual estimated effective tax rate because the Company no longer maintains a full valuation allowance on its U.S. deferred tax assets and discrete tax benefits. For the three months ended MarchJune 31,30, 2026, we recorded a total income tax benefit of $11.7$4.0 million, consisting of a $2.7$1.3 million benefit based on the annual estimated effective tax rate, primarily due toreflecting the loss before income taxtaxes for the period, and $9.0$2.7 million of discrete tax benefits, primarily related to stock-based compensation.
Benefit from income taxes increased $15.1 million during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily because the Company no longer maintains a full valuation allowance on its U.S. deferred tax assets. For the six months ended June 30, 2026, we recorded a total income tax benefit of $15.7 million, consisting of a $4.0 million benefit based on the annual estimated effective tax rate, primarily due to the loss before income tax for the period, and $11.7 million of discrete tax benefits, primarily related to stock-based compensation.
(1) Excludes revenue related to bundled Life360 subscription and hardware offerings, which was immaterial for the three and six months ended MarchJune 31,30, 2026, and $(0.40.3) million and $(0.7) million for the three and six months ended MarchJune 31,30, 2025.2025, respectively.
(2) Excludes revenue related to bundled Life360 subscription and hardware offerings, which was immaterial for the three months ended March 31, 2026, and $0.4$0.1 million for the three and six months ended MarchJune 31,30, 2025.2026, and $0.3 million and $0.6 million for the three and six months ended June 30, 2025, respectively.
We use Annualized Monthly Revenue (“AMR”) to identify the annualized monthly value of active customer agreements at the end of a reporting period. AMR includes the annualized monthly value of subscription, data and partnership agreements. All components of these agreements that are not expected to recur are excluded. This does not represent revenue under GAAP on an annualized basis, as the operating metric can be impacted by start and end dates and renewal rates. AMR as of MarchJune 31,30, 2026, and 2025 was $517.9$537.2 million and $393.0$416.1 million, respectively, representing an increase of 32%29% year-over-year, which is largely attributable to continued subscriber growth and an increase in other recurring revenue.
We have a large and growing global member base as of MarchJune 31,30, 2026. A Life360 Monthly Active User (“MAU”) is defined as a unique member who engages with our Life360 branded services each month, which includes both paying and non-paying members, and excludes certain members who have a delayed account setup. As of MarchJune 31,30, 2026 and 2025, we had approximately 97.8102.4 million and approximately 83.788.0 million MAUs on the Life360 platform, respectively, representing an increase of 17%16% year-over-year. We believe this has been driven by continued strong new member growth and retention.
As reported in our Quarterly Report on Form 10-Q for the three months ended March 31, 2026, MAU growth during the three months ended March 31, 2026 was impacted by Android-related technical issues affecting new user registration, which were resolved by April 2026. MAU growth trends for the three months ended June 30, 2026 are consistent with the Company’s previously disclosed full-year 2026 MAU growth expectation of approximately 17% to 20%.
As of March 31, 2026, MAU growth reflected a suppressed registration funnel resulting from a series of Android-driven technical issues that limited our ability to capture new users. A number of interconnected technical issues impacted Android users on lower-end devices before they fully onboarded. Management identified and resolved these root causes by March 2026, with all issues simultaneously cleared as of April 2026. Overall, we fell 3 percentage points below our planned annual growth trajectory for the three months ended March 31, 2026. The shortfall was concentrated in Android-heavy markets which do not contribute substantially to revenue, and we have determined the reasons why, beyond normal quarterly variation. As a result, we have revised our full-year 2026 MAU growth expectation to approximately 17% to 20% and expect to return to our planned growth trajectory by the third quarter of 2026. Refer to the "Forward-Looking Statements" section above.
As of MarchJune 31,30, 2026 and 2025, we had approximately 3.03.2 million and 2.42.5 million paid subscribers to services under our Life360 brand, respectively, representing an increase of 27% year-over-year. We grow the number of Paying Circles by increasing our free member base, converting free members to subscribers, and retaining them over time with the provision of high-quality family connectivity and safety services.
For the three months ended MarchJune 31,30, 2026 and 2025, our ARPPC was $143.03$142.56 and $133.42,$135.42, respectively, representing a 7%5% increase year-over-year. For the six months ended June 30, 2026 and 2025, our ARPPC was $142.99 and $134.49, respectively, representing a 6% increase year-over-year.
ARPPC is a key indicator utilized by the Company to determine our effectiveness at monetizing Paying Circles through tiered product offerings. The year-over-year growth in ARPPC primarily reflects a shift in product mix toward higher-priced offerings and price increases across select international markets throughout the second half of 2025.
As of MarchJune 31,30, 2026 and 2025, we had approximately 3.53.7 million and 3.03.1 million paid subscribers, respectively, to services under the Life360 and Tile brands, representing an increase of 17%18% year-over-year.
LIF insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 24 filings (7 insiders, 23 trade dates, 528,404 shares, about $25.2M; 19 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: -528,404 (purchases minus sales); net value about -$25.2M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-10-01 | Coghlan John Philip |
Open-market sale |
3,800 | $40.34 | $153.3K |
| 2026-10-01 | Coghlan John Philip |
Open-market sale |
200 | $40.97 | $8.2K |
| 2026-09-21 | Haro Alex |
Open-market sale |
31,275 | $40.72 | $1.3M |
| 2026-09-21 | Haro Alex |
Option exercise |
50,000 | $2.53 | $126.5K |
| 2026-09-21 | Haro Alex |
Open-market sale |
18,725 | $41.16 | $770.7K |
| 2026-09-14 | Prober Charles J. |
Option exercise |
7,930 | $11.18 | $88.7K |
| 2026-09-14 | Prober Charles J. |
Open-market sale |
7,930 | $42.12 | $334.0K |
| 2026-09-08 | Hulls Chris |
Shares withheld for tax | 7,545 | $44.17 | $333.3K |
| 2026-09-08 | Antonoff Lauren |
Shares withheld for tax | 6,291 | $44.17 | $277.9K |
| 2026-09-08 | Burke Russell John |
Shares withheld for tax | 5,314 | $44.17 | $234.7K |
| 2026-09-01 | Coghlan John Philip |
Open-market sale |
4,000 | $41.97 | $167.9K |
| 2026-08-26 | Synge James |
Open-market sale | 27,466 | $44.31 | $1.2M |
| 2026-08-25 | Synge James |
Open-market sale | 5,833 | $45.05 | $262.8K |
| 2026-08-19 | Synge James |
Option exercise | 21,769 | $8.19 | $178.3K |
| 2026-08-19 | Synge James |
Option exercise | 12,203 | $13.35 | $162.9K |
| 2026-08-18 | Hulls Chris |
Open-market sale | 18,566 | $47.58 | $883.4K |
| 2026-08-18 | Hulls Chris |
Open-market sale | 231,434 | $46.78 | $10.8M |
| 2026-08-18 | Hulls Chris |
Option exercise | 114,509 | $8.19 | $937.8K |
| 2026-08-18 | Hulls Chris |
Option exercise | 47,993 | $2.53 | $121.4K |
| 2026-08-18 | Hulls Chris |
Option exercise | 50,000 | $7.28 | $364.0K |
| 2026-08-13 | Prober Charles J. |
Open-market sale |
7,930 | $48.59 | $385.3K |
| 2026-08-13 | Prober Charles J. |
Option exercise |
7,930 | $11.18 | $88.7K |
| 2026-08-10 | Morin Brit |
Option exercise | 1,744 | $8.19 | $14.3K |
| 2026-08-10 | Morin Brit |
Option exercise | 8,021 | $2.15 | $17.2K |
| 2026-08-10 | Morin Brit |
Open-market sale | 15,582 | $65.00 | $1.0M |
| 2026-08-04 | Morin Brit |
Open-market sale |
10,701 | $60.00 | $642.1K |
| 2026-08-04 | Morin Brit |
Option exercise |
872 | $8.19 | $7.1K |
| 2026-08-04 | Morin Brit |
Option exercise |
4,011 | $2.15 | $8.6K |
| 2026-08-04 | Hulls Chris |
Open-market sale |
17,020 | $63.08 | $1.1M |
| 2026-08-04 | Hulls Chris |
Option exercise |
27,000 | $2.53 | $68.3K |
| 2026-08-04 | Hulls Chris |
Open-market sale |
9,980 | $63.77 | $636.4K |
| 2026-08-03 | Coghlan John Philip |
Open-market sale |
2,600 | $54.90 | $142.7K |
| 2026-08-03 | Coghlan John Philip |
Open-market sale |
1,400 | $54.66 | $76.5K |
| 2026-08-01 | Prober Charles J. |
Grant/award | 19 | — | — |
| 2026-07-16 | Hulls Chris |
Open-market sale |
14,345 | $55.74 | $799.6K |
| 2026-07-16 | Hulls Chris |
Option exercise |
27,000 | $2.53 | $68.3K |
| 2026-07-13 | Prober Charles J. |
Open-market sale |
7,930 | $53.05 | $420.7K |
| 2026-07-13 | Prober Charles J. |
Option exercise |
7,930 | $11.18 | $88.7K |
| 2026-07-01 | Coghlan John Philip |
Open-market sale |
202 | $56.57 | $11.4K |
| 2026-07-01 | Coghlan John Philip |
Open-market sale |
3,798 | $56.04 | $212.8K |
| 2026-06-29 | Morin Brit |
Open-market sale |
4,655 | $55.00 | $256.0K |
| 2026-06-18 | Hulls Chris |
Option exercise |
27,000 | $8.19 | $221.1K |
| 2026-06-18 | Hulls Chris |
Open-market sale |
16,042 | $47.07 | $755.1K |
| 2026-06-15 | Prober Charles J. |
Option exercise |
7,930 | $11.18 | $88.7K |
| 2026-06-15 | Prober Charles J. |
Open-market sale |
7,930 | $46.07 | $365.3K |
| 2026-06-12 | Burke Russell John |
Other | 45,000 | — | — |
| 2026-06-08 | Hulls Chris |
Shares withheld for tax | 7,544 | $45.37 | $342.3K |
| 2026-06-08 | Burke Russell John |
Shares withheld for tax | 6,087 | $45.37 | $276.2K |
| 2026-06-08 | Antonoff Lauren |
Shares withheld for tax | 21,130 | $45.37 | $958.7K |
| 2026-06-01 | Coghlan John Philip |
Open-market sale | 3,796 | $43.95 | $166.8K |
| 2026-06-01 | Coghlan John Philip |
Open-market sale | 204 | $44.64 | $9.1K |
| 2026-05-29 | Zuckerberg Randi |
Grant/award | 4,455 | — | — |
| 2026-05-29 | Wiadrowski David |
Grant/award | 4,816 | — | — |
| 2026-05-29 | Synge James |
Grant/award | 4,600 | — | — |
| 2026-05-29 | Prober Charles J. |
Grant/award | 4,455 | — | — |
| 2026-05-29 | Morin Brit |
Grant/award | 4,636 | — | — |
| 2026-05-29 | Haro Alex |
Grant/award | 4,455 | — | — |
| 2026-05-29 | Goines Mark |
Grant/award | 5,322 | — | — |
| 2026-05-29 | Coghlan John Philip |
Grant/award | 4,840 | — | — |
| 2026-05-28 | Hulls Chris |
Option exercise |
27,000 | $8.19 | $221.1K |
Well-known investors holding LIF (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| D. E. Shaw & Co. | 2026-06-30 | 0 | $21.4M | 0.01% | New position |
| Renaissance Technologies | 2026-06-30 | 144,300 | $5.9M | — | Sold out |
| Millennium Management (Israel Englander) | 2026-06-30 | 79,283 | $4.4M | 0.0% | Added 21% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 63,686 | $3.5M | 0.0% | Reduced 63% |
| D. E. Shaw & Co. | 2026-06-30 | 53,241 | $2.9M | 0.0% | Reduced 49% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 7,683 | $425.3K | 0.0% | Added 10% |
| Millennium Management (Israel Englander) | 2026-06-30 | 0 | $167.0K | 0.0% | New position |