Arlo Technologies (ARLO) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 and full-year 2025 results, with total revenue of $141.3M in Q4 and $530M for the year, both above guidance ranges.

• Service revenue reached $89.4M in Q4 (up 39% YoY) and $316M for 2025 (up 30% YoY), now nearly 60% of total revenue.

• Annual recurring revenue (ARR) grew 28% YoY to $330M, with paid accounts up 24% to 5.7M.

• EBITDA for Q4 was $23.3M (up 138% YoY), and full-year adjusted EBITDA was $75M (up 85% YoY).

• Non-GAAP EPS for Q4 was $0.22 (up 120% YoY), and $0.70 for 2025, exceeding guidance.

Financial highlights

• Q4 non-GAAP gross margin reached a record 47.8%, up over 1,000 basis points YoY.

• Q4 non-GAAP net income was $23.9M; full-year non-GAAP net income was $77.3M (up 83% YoY).

• Free cash flow for 2025 was $66.9M (up 38% YoY), with a margin of 12.6%.

• Ended 2025 with $166M in cash and equivalents, after $45.5M in share repurchases and a $12.8M investment in Origin Wireless.

• LTV per subscriber rose to $917 (up 23% YoY), with a LTV/CAC ratio of 4.0.

Outlook and guidance

• Q1 2026 revenue expected at $135M–$145M; full-year 2026 revenue guided to $550M–$580M.

• Service revenue for 2026 projected at $375M–$385M, over 65% of total revenue.

• Non-GAAP EPS for 2026 expected at $0.75–$0.85.

• Continued focus on ARPU growth, subscriber retention, and new strategic partnerships to drive durable revenue.

• Long-range plan targets 10M paid accounts, $700M ARR, and >25% adjusted EBITDA margin by 2030.