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Arlo Technologies
(NYSE:ARLO)
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Rating:71Outperform
Price Target:
$14.50
▼(-4.54% Downside)
Action:Reiterated
Date:06/24/26
Overall score is driven primarily by strong financial improvement and cash generation alongside a very low-leverage balance sheet, reinforced by a positive earnings call with accelerating subscription metrics and margin expansion. Offsetting these positives are a relatively weak/neutral technical picture and a high P/E valuation that raises execution sensitivity, plus manageable near-term headwinds (tariffs, component costs, and higher investment).
Positive Factors
Very low leverage / strong balance sheet
Arlo’s minimal leverage and rebuilt equity provide durable financial flexibility: it can fund partner integrations, M&A or buybacks while absorbing shocks. Low debt reduces default risk and interest sensitivity, supporting multi‑quarter investment without stressing cash flows or covenants.
Negative Factors
Tariff and component cost pressure
Persistent tariffs and sharply higher memory costs directly compress product margins and could outlast short‑term fixes. Because product sales still drive acquisition, prolonged cost inflation would force either lower margins, higher prices (risking demand), or increased R&D/ops to redesign BOMs — all multi‑quarter impacts.
Read all positive and negative factors
Positive Factors
Negative Factors
Very low leverage / strong balance sheet
Arlo’s minimal leverage and rebuilt equity provide durable financial flexibility: it can fund partner integrations, M&A or buybacks while absorbing shocks. Low debt reduces default risk and interest sensitivity, supporting multi‑quarter investment without stressing cash flows or covenants.
Read all positive factors
Arlo Technologies (ARLO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.41B
Dividend YieldN/A
Average Volume (3M)1.48M
Price to Earnings (P/E)45.0
Beta (1Y)1.95
Revenue Growth10.85%
EPS GrowthN/A
CountryUS
Employees360
SectorIndustrials
Sector Strength72
IndustrySecurity & Protection Services
Share Statistics
EPS (TTM)0.29
Shares Outstanding108,609,820
10 Day Avg. Volume1,153,498
30 Day Avg. Volume1,475,153
Financial Highlights & Ratios
PEG Ratio-0.69
Price to Book (P/B)11.40
Price to Sales (P/S)2.75
P/FCF Ratio21.79
Enterprise Value/Market Cap0.87
Enterprise Value/Revenue2.20
Enterprise Value/Gross Profit4.87
Enterprise Value/Ebitda34.13
Forecast
1Y Price Target
$21.40Price Target Upside40.88% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)0.83
Revenue Forecast (FY)$565.79M
Arlo Technologies Business Overview & Revenue Model
Company Description
Arlo Technologies, Inc. delivers a comprehensive, cloud-centric smart security ecosystem across the Americas, Europe, the Middle East, Africa, and Asia Pacific regions. This system seamlessly integrates an intelligent cloud backbone and a user-fri...
How the Company Makes Money
Arlo primarily makes money through (1) product sales and (2) subscription and service revenue. Product revenue comes from selling smart security hardware—such as cameras, video doorbells, security systems, and accessories—through retail, e-commerc...
Arlo Technologies Earnings Call Summary
Earnings Call Date:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The call presented a clearly positive operational and financial story: record revenue and EPS, strong subscriber/addition metrics, rising ARPU and ARR, substantially improved gross margins and adjusted EBITDA, healthy free cash flow and a strong cash position. Management also highlighted multiple strategic partnerships (ADT, Samsung, Comcast) and an acquisition (Aloe Care) that expand future TAM and monetization pathways. Offsetting risks are manageable near-term headwinds (tariffs and rising memory costs), higher operating expense from investment and some inventory buildup, as well as timing uncertainty for tariff relief and the full commercial impact of larger partnerships (notably Comcast which is expected to be material in 2027). Overall, positives substantially outweigh the headwinds.Positive Updates
Record Revenue and Strong YoY Growth
Total revenue of $150.4M, up 26% year-over-year, beating the top end of guidance for the quarter.
Negative Updates
Tariff Headwind Weighing on Product Margins
Tariffs created an estimated ~430 basis point headwind; product non-GAAP gross margin was negative 2.8% in the quarter (but would be +1.5% excluding tariffs). Eligibility/timing for tariff relief claims remains uncertain.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Revenue and Strong YoY Growth
Total revenue of $150.4M, up 26% year-over-year, beating the top end of guidance for the quarter.
Read all positive updates
Company Guidance
For Q2 Arlo guided total revenue of $145–$155 million and non‑GAAP net income per diluted share of $0.17–$0.23, saying subscriptions & services revenue should continue to grow while product revenue remains solid as strategic partner demand ramps and the company invests to integrate partners and support acquisitions like Aloe Care; management also reiterated confidence in achieving its full‑year 2026 outlook for subscriptions & services revenue, total revenue and EPS. For context, Q1 included 318,000 net paid account additions (surpassing 6.0 million paid accounts), ARR of $357 million (up 29% YoY), ARPU of $15.60 (up 16% YoY), subscriptions & services revenue of $90 million (60% of total, +31% YoY), total revenue of ~$150.4 million (+26% YoY), consolidated non‑GAAP gross margin ~50% (up 460 bps YoY), subscriptions/services gross margin 85.4%, product revenue $60.3 million, adjusted EBITDA $30.4 million (20% margin, +85% YoY), non‑GAAP EPS $0.28, free cash flow $25.4 million (~17% margin), cash and short‑term investments $167.5 million, AR receivable $52 million (DSO 31 days) and inventory $44 million (≈6x turns).Arlo Technologies Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
88
Very Positive
Cash Flow
83
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 560.61M | 529.30M | 510.89M | 491.18M | 490.41M | 435.14M |
| Gross Profit | 252.78M | 232.84M | 187.50M | 167.56M | 136.03M | 108.03M |
| EBITDA | 36.09M | 19.60M | -26.21M | -16.20M | -50.88M | -45.05M |
| Net Income | 30.64M | 14.93M | -30.50M | -22.04M | -56.63M | -56.03M |
Balance Sheet | ||||||
| Total Assets | 360.19M | 310.55M | 298.40M | 285.54M | 272.20M | 347.49M |
| Cash, Cash Equivalents and Short-Term Investments | 167.50M | 166.43M | 151.45M | 136.50M | 113.72M | 175.75M |
| Total Debt | 6.23M | 6.74M | 18.36M | 17.02M | 23.47M | 26.08M |
| Total Liabilities | 200.79M | 182.71M | 197.49M | 182.26M | 184.51M | 234.84M |
| Stockholders Equity | 159.40M | 127.84M | 100.91M | 103.28M | 87.69M | 112.65M |
Cash Flow | ||||||
| Free Cash Flow | 64.22M | 66.90M | 48.62M | 35.45M | -47.97M | -25.46M |
| Operating Cash Flow | 75.67M | 78.72M | 51.31M | 38.30M | -45.96M | -23.20M |
| Investing Cash Flow | 27.77M | 27.75M | 10.84M | -50.69M | -31.77M | 17.73M |
| Financing Cash Flow | -34.81M | -42.07M | -40.77M | -15.14M | -13.94M | -4.97M |
Arlo Technologies Technical Analysis
Negative
15.19
Price Trends
13.37
Negative
13.48
Negative
14.41
Negative
Market Momentum
-0.05
Negative
48.99
Neutral
66.96
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARLO, the sentiment is Negative. The current price of 15.19 is above the 20-day moving average (MA) of 12.89, above the 50-day MA of 13.37, and above the 200-day MA of 14.41, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 48.99 is Neutral, neither overbought nor oversold. The STOCH value of 66.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARLO.
Arlo Technologies Risk Analysis
Arlo Technologies disclosed 58 risk factors in its most recent earnings report. Arlo Technologies reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Arlo Technologies Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.41B | 45.04 | 22.92% | ― | 10.85% | ― | |
68 Neutral | $1.35B | 36.69 | 20.86% | 1.29% | 8.83% | -16.34% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
55 Neutral | $44.33M | 32.48 | 3.21% | ― | ― | ― | |
52 Neutral | $1.12B | -27.61 | -33.53% | ― | 40.54% | 20.94% | |
48 Neutral | $112.97M | -2.76 | -21.22% | ― | 6.39% | 0.74% | |
47 Neutral | $35.19M | -0.58 | -143.53% | ― | 25.86% | 68.12% |
* Industrials Sector Average
ARLO
Arlo Technologies
12.98
-4.62
-26.25%
SNT
Senstar Technologies
1.90
-3.14
-62.30%
NSSC
Napco Security Technologies
37.79
8.08
27.19%
EVLV
Evolv Technologies Holdings
6.24
0.22
3.65%
BAER
Bridger Aerospace Group Holdings
1.96
0.01
0.51%
KSCP
Knightscope Inc Class A
2.04
-3.38
-62.36%
Arlo Technologies Corporate Events
Executive/Board ChangesShareholder Meetings
Arlo Shareholders Back Directors, Auditor and Executive Pay
Positive
Jun 23, 2026
On June 18, 2026, Arlo Technologies held its 2026 Annual Meeting of Stockholders, where shareholders elected three Class II directors — Grady K. Summers, Prashant (Sean) Aggarwal and Amy Rothstein — to serve until the 2029 annual meeti...
Business Operations and StrategyRegulatory Filings and Compliance
Arlo Technologies Updates Bylaws, Enhancing Corporate Governance Framework
Positive
Apr 7, 2026
On April 3, 2026, Arlo Technologies, Inc.’s board adopted amended and restated bylaws that modernize corporate governance mechanics, expand use of electronic communications, and clarify procedures for stockholder meetings and board and commi...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.