Owlet, Inc. (“Owlet” or the “Company”) (NYSE:OWLT), the pioneer
of smart infant monitoring, today announces the following
preliminary unaudited results for the fourth quarter 2023.
Preliminary Unaudited Q4 2023 Financial Highlights
- Q4 Gross Sales is expected to be approximately $32.9
million, up 114% year over year.
- Q4 Net Revenue is expected to be approximately $21.0
million, up 75% year over year.
- Q4 Gross Margin is expected to be approximately 47%, up
over 1,900 basis points from 27.8% year over year.
- Q4 Net Loss is expected to be approximately $6.9
million, down 65% from $19.5 million year over year.
- Q4 adjusted EBITDA loss is expected to be approximately
$0.7 million, down 95% from $15.2 million year over year.
“We delivered on our promise to gain FDA clearances, improve
operations, reduce costs, and bring the business near Adjusted
EBITDA break even in the fourth quarter of 2023,” said Kurt
Workman, Co-Founder and Chief Executive Officer. “We had incredibly
strong sales performance on the back of FDA approvals nearly
doubling sell-through during our holiday promotional period over
2022. In 2024 the momentum is building as we commercialize our new
medical devices, expand distribution into healthcare and integrate
with insurance providers for BabySat. Owlet is in the best
operating health and product position in our company’s history and
believe the combination of the operating leverage and new growth
from FDA clearances will propel Owlet to a new level.”
Workman continued, “It’s worth noting that Q4 gross margin &
adjusted EBITDA loss were negatively impacted by non-recurring
items associated with the transition of the US channel to Amazon
1P. Excluding these items, gross margin would have been just north
of 50% and Adjusted EBITDA would have been positive for the
quarter. This channel transition is behind us and we are realizing
the full financial and operation benefits from this transition now.
I’m proud of the immense progress our team has made in re-shaping
the company in 2023.”
The Company will report its full fourth quarter and year-end
2023 financial results after the market closes on March 7, 2024.
Owlet will issue a copy of the earnings release via Business Wire
and include a copy on Owlet’s Investor Relations website at
investors.owletcare.com. Owlet’s Chief Executive Officer, Kurt
Workman, and Chief Financial Officer, Kate Scolnick, will host a
conference call that same day at 4:30 p.m. ET to discuss these
results and provide a business update.
To access the conference call by telephone, please dial (404)
975-4839 (domestic) or +833-470-1428 (international) and reference
Access Code 102390. To listen to the conference call via live audio
webcast, please visit the Events section of Owlet’s Investor
Relations website at investors.owletcare.com.
The archived webcast will also be available on Owlet’s Investor
Relations website mentioned above.
Note Regarding Preliminary Unaudited Results
The preliminary unaudited results for the three-months ended
December 31, 2023 included in the press release are estimates and
represent the most current information available to the Company’s
management, as financial closing procedures for the fourth quarter
and full year ended December 31, 2023 are not yet complete. Actual
results will be reported in the Company’s Annual Report on Form
10-K for the fiscal year ended December 31, 2023 and may change as
a result of such financial closing procedures, final adjustment,
management’s review of results, and other developments that may
arise between now and the time the Company’s financial closing
procedures are finalized and the audit of its financial statements
for the fiscal year ended December 31, 2023 is completed. The
Company’s independent auditor has not audited, reviewed, compiled
or applied agreed-upon procedures with respect to the preliminary
unaudited results and has not expressed any opinion or other form
of assurance with respect to such results.
Preliminary return and chargeback allowances for the quarter,
which impact the Company’s net revenue, have been estimated based
upon historical averages and an initial analysis of claims received
and are preliminary and subject to the completion of financial
closing procedures and any potential receipt of new information. As
a result, preliminary unaudited net revenue for the quarter ended
December 31, 2023 may differ materially from the amounts that will
be reflected in the Company’s consolidated financial statements for
the fiscal year ended December 31, 2023.
About Owlet, Inc.
Owlet was founded by a team of parents in 2012. Owlet’s mission
is to empower parents with the right information at the right time,
to give them more peace of mind and help them find more joy in the
journey of parenting. Owlet’s digital parenting platform aims to
give parents real-time data and insights to help parents feel
calmer and more confident. Owlet believes that every parent
deserves peace of mind and the opportunity to feel their
well-rested best. Owlet also believes that every child deserves to
live a long, happy, and healthy life, and is working to develop
products to help further that belief. To learn more, visit
www.owletcare.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
(the “Reform Act”). All statements contained in this press release
that do not relate to matters of historical fact should be
considered forward-looking statements, including, without
limitation, statements regarding the Company’s estimated financial
results for the fourth quarter ended December 31, 2023, growth
prospects and expanded product offerings. In some cases, you can
identify forward-looking statements by terms such as “estimate,”
“may,” “believes,” “plans,” “expects,” “anticipates,” “intends,”
“goal,” “potential,” “upcoming,” “outlook,” “guidance,” the
negation thereof, or similar expressions, although not all
forward-looking statements contain these identifying words.
Forward-looking statements are based on the Company’s expectations
at the time such statements are made, speak only as of the dates
they are made and are susceptible to a number of risks,
uncertainties and other factors. For all such forward-looking
statements, the Company claims the protection of the safe harbor
for forward-looking statements contained in the Reform Act. The
Company’s actual results, performance or achievements may differ
materially from any future results, performance or achievements
expressed or implied by our forward-looking statements. Many
important factors could affect the Company’s future results and
cause those results to differ materially from those expressed in or
implied by the Company’s forward-looking statements. Such factors
include, but are not limited to, (i) completion of the Company’s
financial closing procedures and any potential receipt of new
information that would impact the Company’s preliminary fourth
quarter estimated financial results included in this press release,
(ii) the regulatory pathway for Owlet’s products, including
submissions to, actions taken by and decisions and responses from
regulators, such as the FDA and similar regulators outside of the
United States, as well as Owlet’s ability to obtain and maintain
regulatory approval or certification for our products and other
regulatory requirements and legal proceedings; (iii) Owlet’s
competition and the Company’s ability to profitably grow and manage
growth; (iv) the Company’s ability to enhance future operating and
financial results or obtain additional financing to continue as a
going concern; (v) Owlet’s ability to obtain additional financing
in the future, as well risks associated with the Company’s current
loan and debt agreements, including compliance with debt covenants,
restrictions on the Company’s access to capital, the impact of the
Company’s overall debt levels and the Company’s ability to generate
sufficient future cash flows to meet Owlet’s debt service
obligations and operate Owlet’s business; (vi) the ability of Owlet
to implement strategic initiatives, reduce costs, grow revenues,
develop and launch new products, innovate and enhance existing
products, meet customer demands and adapt to changes in consumer
preferences and retail trends; (vii) Owlet’s ability to acquire,
defend and protect its intellectual property and satisfy regulatory
requirements, including but not limited to requirements concerning
privacy and data protection, breaches and loss, as well as other
risks associated with Owlet’s digital platforms and technologies;
(viii) Owlet’s ability to maintain relationships with customers,
manufacturers and suppliers and retain Owlet’s management and key
employees; (ix) Owlet’s ability to upgrade and maintain its
information technology systems; (x) changes in applicable laws or
regulations; (xi) the impact of and disruption to Owlet’s business,
financial condition, operations, supply chain and logistics due to
economic and other conditions beyond the Company’s control, such as
health epidemics or pandemics, macro-economic uncertainties, social
unrest, hostilities, natural disasters or other catastrophic
events; (xii) the possibility that Owlet may be adversely affected
by other economic, business, regulatory, competitive or other
factors, such as changes in discretionary consumer spending and
consumer preferences; and (xiii) other risks and uncertainties set
forth in the Company’s other releases, public statements and
filings with the U.S. Securities and Exchange Commission (“SEC”),
including those identified in the “Risk Factors” section of the
Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022, as updated in the Company’s Quarterly Reports on
Form 10-Q for the quarterly periods ended March 31, 2023, June 30,
2023 and September 30, 2023 and as any such factors may be updated
from time to time in the Company’s other filings with the SEC,
including, but not limited to, its Annual Report on Form 10-K for
the fiscal year ended December 31, 2023. All such forward-looking
statements attributable to the Company or any person acting on the
Company’s behalf are expressly qualified in their entirety by the
cautionary statements contained or referred to above. Moreover, the
Company operates in an evolving environment. New risk factors and
uncertainties may emerge from time to time, and factors that the
Company currently deems immaterial may become material, and it is
impossible for the Company to predict such events or how they may
affect Owlet. Except as required by law, the Company assumes no
obligation to update any forward-looking statements after the date
of this press release, whether because of new information, future
events or otherwise, although Owlet may do so from time to time.
The Company does not endorse any projections regarding future
performance that may be made by third parties.
Disclosure Regarding Non-GAAP Financial Measures
The Company has included a preliminary estimate of adjusted
EBITDA, a financial measure that is not presented in accordance
with U.S. Generally Accepted Accounting Principles (“GAAP”).
The Company adjusted EBITDA as an internal measure of business
operating performance and as a performance measure for benchmarking
against the Company’s peers and competitors. The Company believes
its presentation of adjusted EBITDA provides a meaningful
perspective of the underlying operating performance of the
Company’s current business and enables investors to better
understand and evaluate its historical and prospective operating
performance. The Company believes that this non-GAAP financial
measure is an important supplemental measure of operating
performance because it excludes items that vary from period to
period without correlation to the Company’s core operating
performance and highlights trends in its business that may not
otherwise be apparent when relying solely on GAAP financial
measures. Due to the nature of the items being excluded, such items
do not reflect future gains, losses, expenses or benefits and are
not indicative of the Company’s future operating performance. The
Company believes investors, analysts and other interested parties
use adjusted EBITDA in evaluating issuers, and the presentation of
adjusted EBITDA facilitates a comparative assessment of the
Company’s operating performance in addition to the Company’s
performance based on GAAP results.
The Company’s non-GAAP financial measure should not be
considered as an alternative to net loss as a measure of financial
performance or any other performance measure derived in accordance
with GAAP, and should not be construed as an inference that the
Company’s future results will be unaffected by unusual or
non-recurring items.
Adjusted EBITDA is defined as net loss adjusted for income tax
provision, interest expense, interest expense from contingent
beneficial conversion feature, interest income, depreciation and
amortization, restructuring costs, warrant liability adjustments,
gain on loan forgiveness, stock-based compensation, and transaction
costs.
Adjusted EBITDA is not a recognized term under GAAP, and the
Company’s presentation of adjusted EBITDA does not replace the
presentation of the Company’s financial results in accordance with
GAAP. Because all companies do not use adjusted EBITDA (and
similarly titled financial measures) in the same way, this measure
as used by other companies may not be consistent with the way the
Company calculates such measure. Adjusted EBITDA should not be
construed as a substitute for or a better indicator of the
Company’s performance than the most directly comparable GAAP
financial measure. See the reconciliation tables that accompany
this release for additional information regarding certain of the
non-GAAP financial measures included herein.
Owlet, Inc. Reconciliation of GAAP to Non-GAAP Measures -
Preliminary, Unaudited1 (in millions)
Three Months
Ended December 31,
2023
2022
Net loss
$
(6.9
)
$
(19.5
)
Income tax provision
—
—
Interest expense, net
0.2
0.3
Depreciation and amortization
0.1
0.4
EBITDA
$
(6.6
)
$
(18.9
)
Restructuring costs
—
0.2
Common stock warrant liability adjustment
3.6
(1.5
)
Stock-based compensation
2.3
4.4
Transaction costs
—
0.6
Adjusted EBITDA
$
(0.7
)
$
(15.2
)
Three Months Ended December 31,
2023
2022
Revenue
$
21.0
$
12.0
Customer discounts
5.9
2.0
Returns & allowances
5.7
1.5
Net change in deferred revenue
0.3
(0.2
)
Gross Billings
$
32.9
$
15.4
1 Amounts may not sum due to rounding
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240222283108/en/
Investor Contacts:
Mike Cavanaugh ICR Westwicke Phone: +1.617.877.9641
mike.cavanaugh@westwicke.com
Media Contacts: pr@owletcare.com
owlet@diffusionpr.com
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