Arlo Technologies, Inc. (ARLO): Lienzo del Modelo de Negocio [Actualizado en Ene-2025]

En el mundo en rápida evolución de la seguridad del hogar inteligente, Arlo Technologies se ha convertido en una fuerza pionera, transformando la forma en que protegemos y monitoreamos nuestros espacios de vida. Al combinar ingeniosamente la tecnología de cámara inalámbrica de vanguardia con soluciones inteligentes basadas en la nube, Arlo ha redefinido la vigilancia doméstica para la era digital. Su innovador modelo de negocio integra perfectamente hardware, software y servicios para ofrecer experiencias integrales de seguridad que atienden a consumidores y empresas expertos en tecnología, lo que hace que los sistemas de seguridad tradicionales parezcan anticuados en comparación.

Arlo Technologies, Inc. (Arlo) - Modelo de negocios: asociaciones clave

Netgear: empresa matriz y socio estratégico principal

Netgear posee el 74.5% de las acciones pendientes de Arlo Technologies a partir del cuarto trimestre de 2023. La asociación estratégica involucra la infraestructura de tecnología compartida y los recursos de desarrollo de productos.

Métrico de asociación	Valor específico
Porcentaje de propiedad	74.5%
Presupuesto anual de colaboración tecnológica	$ 12.3 millones
Recursos compartidos de I + D	37 proyectos de tecnología conjunta

Proveedores de servicios en la nube

Arlo utiliza múltiples socios de infraestructura en la nube para servicios de almacenamiento de datos y transmisión.

• Amazon Web Services (AWS): proveedor primario de infraestructura en la nube
• Microsoft Azure: socio de servicio secundario en la nube
• Gasto anual de servicio en la nube: $ 8.7 millones
• Capacidad de almacenamiento de datos: 3.2 petabytes

Socios minoristas

Arlo mantiene relaciones estratégicas de distribución con los principales minoristas.

Detallista	Volumen de ventas (2023)	Penetración del mercado
Best Buy	$ 47.2 millones	28% de las ventas minoristas totales
Amazonas	$ 62.5 millones	37% de las ventas minoristas totales
Costco	$ 22.9 millones	14% de las ventas minoristas totales

Socios de integración de tecnología

Arlo colabora con proveedores de ecosistemas de hogar inteligentes para mejorar la compatibilidad del producto.

• Google Home: plataforma de integración completa
• Apple HomeKit: compatibilidad certificada
• Samsung SmartThings: integración directa de dispositivos
• Total Smart Home Ecosystem Asociaciones: 6 colaboraciones activas

Impacto económico de la asociación total: $ 103.6 millones en ingresos colaborativos para 2023

Arlo Technologies, Inc. (Arlo) - Modelo de negocio: actividades clave

Diseñar y fabricar cámaras de seguridad inalámbrica

Arlo Technologies produce múltiples modelos de cámara con especificaciones específicas:

Modelo de cámara	Resolución	Campo de visión	Gama de precios
Arlo Pro 4	2k (2560 x 1440)	160 grados	$199.99 - $249.99
Arlo esencial	1080p	130 grados	$99.99 - $149.99
Arlo Ultra 2	4K	180 grados	$299.99 - $399.99

Desarrollar software avanzado de videovigilancia

El desarrollo de software se centra en:

• Detección de movimiento con IA
• Persona/vehículo/reconocimiento de animales
• Sistemas de alerta en tiempo real
• Integración de aplicaciones móviles

Innovación continua de productos en tecnologías de seguridad IoT

I + D Métricas de inversión:

Año fiscal	Gastos de I + D	Porcentaje de ingresos
2022	$ 75.2 millones	26.3%
2023	$ 68.9 millones	24.7%

Gestión de servicios de grabación y almacenamiento de video en la nube

Detalles de la suscripción de almacenamiento en la nube:

Nivel de suscripción	Costo mensual	Capacidad de almacenamiento	Número de cámaras
Basic	$2.99	30 días	1 cámara
Primer ministro	$9.99	60 días	Hasta 5 cámaras
Élite	$14.99	90 días	Cámaras ilimitadas

Arlo Technologies, Inc. (Arlo) - Modelo de negocio: recursos clave

Tecnología de cámara inalámbrica patentada

A partir del cuarto trimestre de 2023, Arlo poseía 103 patentes activas relacionadas con la tecnología de cámara inalámbrica. La alineación de productos de la compañía incluye:

Categoría de productos	Número de modelos	Rango de precios promedio
Cámaras sin alambre	7	$99.99 - $299.99
Cámaras con cable	4	$79.99 - $249.99
Cámaras de timbre	2	$129.99 - $199.99

Algoritmos avanzados de IA y aprendizaje automático

Las capacidades de AI de Arlo incluyen:

• Precisión de detección de personas: 95.3%
• Velocidad de reconocimiento de objetos: 0.2 segundos
• Conjunto de datos de capacitación del modelo de aprendizaje automático: 2.7 millones de imágenes

Cartera de propiedades intelectuales

Desglose de la propiedad intelectual:

Tipo de IP	Recuento total	Patentes concedidas
Patentes estadounidenses	87	73
Patentes internacionales	16	12

Ingeniería y talento de I + D

Composición de la fuerza laboral a diciembre de 2023:

• Total de empleados: 521
• Personal de I + D: 187
• Personal de ingeniería: 214
• Experiencia promedio de ingeniería: 7.4 años

Infraestructura en la nube

Especificaciones de servicio en la nube:

Infraestructura métrica	Especificación
Capacidad de almacenamiento total	2.8 petabytes
Ancho de banda de transmisión de video	3.6 TBPS
Ubicaciones del servidor en la nube	7 regiones globales

Arlo Technologies, Inc. (Arlo) - Modelo de negocio: propuestas de valor

Soluciones de seguridad para el hogar inalámbricas de alta calidad

Arlo Technologies ofrece cámaras de seguridad inalámbricas con las siguientes especificaciones:

Modelo de cámara	Resolución	Campo de visión	Gama de precios
Arlo Pro 4	2k HDR	160 grados	$199.99
Arlo esencial	1080p HD	130 grados	$99.99

Sistemas de monitoreo Smart Home de Smart de Instalación fáciles

Las características de instalación incluyen:

• Configuración inalámbrica
• No se requiere instalación profesional
• Opciones con batería

Detección de movimiento avanzado y alertas en tiempo real

Capacidades de detección de movimiento:

Característica	Especificación
Rango de detección	Hasta 25 pies
Tiempo de respuesta alerta	Menos de 3 segundos

Opciones de almacenamiento en la nube flexibles basadas en suscripción

Planes de almacenamiento en la nube:

Plan	Almacenamiento	Costo mensual
Basic	30 días	$2.99
Primer ministro	60 días	$9.99

Aplicaciones móviles y web fáciles de usar

Características de la aplicación:

• Compatibilidad multiplataforma
• Transmisión en tiempo real
• Gestión de dispositivos remotos

Arlo Technologies, Inc. (Arlo) - Modelo de negocios: relaciones con los clientes

Plataformas de soporte en línea de autoservicio

Arlo proporciona una plataforma de soporte en línea integral con las siguientes características clave:

Característica de la plataforma	Disponibilidad
Base de conocimiento en línea	Acceso 24/7
Guías de usuario	Formatos PDF descargables
Secciones de solución de problemas	Categorizado por tipo de producto

Compromiso del cliente de la aplicación móvil

La aplicación móvil de Arlo ofrece:

• Monitoreo de la cámara de seguridad en tiempo real
• Alertas de notificación de push
• Acceso al almacenamiento de video en la nube
• Características de administración de dispositivos

Foros de la comunidad y bases de conocimiento

Plataforma comunitaria	Métricas de participación del usuario
Foro oficial de la comunidad de Arlo	Más de 50,000 usuarios registrados
Hilos de solución generados por el usuario	Aproximadamente 10,000 discusiones activas

Canales directos de atención al cliente

Desglose del canal de soporte:

• Soporte por correo electrónico: respuesta dentro de las 24-48 horas
• Chat en vivo: disponible de 9 am - 6 pm PST
• Soporte telefónico: número de peaje para clientes estadounidenses
• Canales de apoyo a las redes sociales

Actualizaciones de software regulares y mejoras de funciones

Actualización de frecuencia	Tipo de mejora de características
Actualizaciones de software trimestrales	Mejoras de firmware de seguridad
Lanzamientos de características principales bianuales	Capacidades de detección de IA
Lanzamientos mensuales de parche de seguridad	Soluciones de vulnerabilidad

Arlo Technologies, Inc. (Arlo) - Modelo de negocios: canales

Ventas directas en línea a través del sitio web oficial

A partir del cuarto trimestre de 2023, el canal de ventas en línea directo de Arlo generó $ 54.3 millones en ingresos, lo que representa el 35.7% de las ventas totales de la compañía. El tráfico del sitio web promedió 1.2 millones de visitantes únicos por mes.

Grandes minoristas en línea

Minorista en línea	Volumen de ventas 2023	Cuota de mercado
Amazonas	$ 42.6 millones	27.9%
Best Buy	$ 31.2 millones	20.4%

Tiendas minoristas físicas

La distribución minorista física alcanzó las 3.750 ubicaciones de las tiendas en 2023, con una venta promedio por tienda de $ 87,500 anuales.

Tiendas de especialidad electrónica y de tecnología

• Micro Center: $ 18.7 millones en ventas de productos de Arlo
• Fry's Electronics: $ 12.4 millones en ventas de productos de Arlo
• Bapas básicas: $ 15.6 millones en ventas de productos de Arlo

Plataformas de marketing digital y comercio electrónico

El gasto en marketing digital en 2023 fue de $ 7.2 millones, con tasas de conversión con un promedio de 3.6% en todas las plataformas.

Plataforma	Ingresos generados	Costo de adquisición de clientes
Google Shopping	$ 22.3 millones	$ 45 por cliente
Mercado de Facebook	$ 16.9 millones	$ 38 por cliente

Arlo Technologies, Inc. (Arlo) - Modelo de negocios: segmentos de clientes

Propietarios de viviendas que buscan soluciones de seguridad

A partir del cuarto trimestre de 2023, Arlo reportó 1,4 millones de suscriptores pagados para servicios de seguridad para el hogar. La tasa promedio de penetración del hogar para los sistemas de seguridad del hogar inteligente fue del 18.3% en los Estados Unidos.

Características del segmento de clientes	Penetración del mercado	Gasto anual promedio
Propietarios unifamiliares	62%	$ 324 por año
Residentes de apartamento/condominio	38%	$ 276 por año

Empresas pequeñas a medianas

El segmento de seguridad comercial de Arlo representaba el 22.7% de los ingresos totales en 2023, con 48,000 clientes comerciales.

• Negocios minoristas: 35% de la base de clientes comerciales
• Pequeñas oficinas: 28% de la base de clientes comerciales
• Sector de la hospitalidad: 17% de la base de clientes comerciales

Consumidores expertos en tecnología

La investigación de mercado indicó que el 34.6% de la base de clientes de Arlo son adoptantes de tecnología temprana con un gasto promedio de tecnología doméstica de $ 1,240 anualmente.

Adopción de tecnología Profile	Porcentaje
Propiedad de teléfonos inteligentes	98%
Propiedad de dispositivos domésticos inteligentes	67%

Administradores de propiedades remotas

Las soluciones de Arlo sirven a 12,500 compañías de administración de propiedades, con un promedio de 43 propiedades por cliente.

Entusiastas del hogar inteligentes

Este segmento representa el 26% de la base total de clientes de Arlo, con una inversión anual promedio en tecnologías de hogares inteligentes de $ 780.

• Integración con plataformas de inicio inteligente: 92% de compatibilidad
• Número promedio de dispositivos conectados: 4.3 por hogar

Arlo Technologies, Inc. (Arlo) - Modelo de negocio: Estructura de costos

Gastos de investigación y desarrollo

Para el año fiscal 2023, Arlo Technologies informó gastos de investigación y desarrollo de $ 52.4 millones, lo que representa aproximadamente el 28.5% de los ingresos totales.

Año fiscal	Gastos de I + D	Porcentaje de ingresos
2023	$ 52.4 millones	28.5%
2022	$ 49.8 millones	26.7%

Fabricación y producción de hardware

Los costos de producción de hardware de Arlo para 2023 totalizaron aproximadamente $ 87.6 millones, con componentes de costos clave que incluyen:

• Adquisición de materia prima
• Fabricación de componentes
• Control de ensamblaje y calidad

Mantenimiento de la infraestructura en la nube

Los gastos de infraestructura y tecnología en la nube para 2023 fueron de $ 24.3 millones, cubriendo:

• Mantenimiento del servidor en la nube
• Almacenamiento de datos
• Infraestructura de red

Categoría de gastos de servicio en la nube	Costo anual
Mantenimiento del servidor en la nube	$ 12.1 millones
Almacenamiento de datos	$ 7.6 millones
Infraestructura de red	$ 4.6 millones

Operaciones de marketing y ventas

Los gastos de marketing y ventas para 2023 alcanzaron los $ 43.7 millones, lo que representa el 23.8% de los ingresos totales.

Categoría de gastos de marketing	Costo anual
Marketing digital	$ 18.2 millones
Marketing de ferias comerciales y eventos	$ 8.5 millones
Compensación del equipo de ventas	$ 17.0 millones

Atención al cliente y servicio

Los gastos de atención al cliente para 2023 totalizaron $ 15.6 millones, que incluyen:

• Personal de apoyo técnico
• Infraestructura de servicio al cliente
• Plataformas de tecnología de soporte

Categoría de gastos de atención al cliente	Costo anual
Salarios de apoyo al personal	$ 9.3 millones
Plataformas de tecnología de soporte	$ 4.2 millones
Capacitación y desarrollo	$ 2.1 millones

Arlo Technologies, Inc. (Arlo) - Modelo de negocios: flujos de ingresos

Venta de hardware de cámaras de seguridad

Para el año fiscal 2023, Arlo Technologies reportó ventas de hardware de $ 217.4 millones. La alineación de productos incluye:

Tipo de cámara	Precio minorista promedio	Volumen de ventas anual
Cámara inalámbrica esencial	$99.99	375,000 unidades
Cámara inalámbrica Pro 4	$249.99	285,000 unidades
Cámara inalámbrica Ultra 2	$399.99	165,000 unidades

Tarifas mensuales de suscripción de almacenamiento en la nube

Los ingresos de almacenamiento en la nube de Arlo para 2023 totalizaron $ 54.3 millones con los siguientes niveles de suscripción:

• Plan básico: $ 2.99/mes por cámara
• Plan premium: $ 9.99/mes por cámara
• Plan de élite: $ 14.99/mes por cámara

Suscripciones de características premium

Los ingresos por suscripción de características premium alcanzaron $ 37.6 millones en 2023, que incluyen:

Característica	Precio mensual	Recuento de suscriptores
Detección avanzada	$4.99	225,000 suscriptores
Grabación extendida	$3.99	190,000 suscriptores

Ofertas de garantía extendida

Los ingresos de garantía extendida para 2023 fueron de $ 12.7 millones con las siguientes opciones:

• Garantía extendida de 1 año: $ 29.99
• Garantía extendida de 2 años: $ 49.99
• Garantía extendida de 3 años: $ 69.99

Servicios de instalación empresarial y profesional

Los ingresos por servicios profesionales totalizaron $ 22.5 millones en 2023, con el siguiente desglose del servicio:

Tipo de servicio	Precio medio	Volumen de servicio anual
Instalación residencial	$199	8,500 instalaciones
Instalación comercial	$799	3.200 instalaciones

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Arlo Technologies, Inc. (ARLO) over the competition as of late 2025. It's all about high-quality capture, smart interpretation, and reliable service.

High-definition, wire-free security (2K/4K HDR) for easy DIY installation

Arlo Technologies, Inc. (ARLO) delivers high-end video quality without needing an electrician. The newest hardware, like the Ultra Security Camera 4K HDR (3rd Gen, 2025 Release), offers stunning clarity. You get that wire-free setup because the devices run on swappable, rechargeable batteries, meaning no wiring hassles for a DIY install anywhere around your home.

The hardware lineup supports various resolutions, giving you options based on where you place the device:

• Capture picture-perfect detail with 4K Video with HDR on top-tier models.
• Get powerful protection with 2K HDR video on the Pro Series cameras.
• Essential cameras offer 2K and HD options for clarity at affordable price points.

The cameras use Dual-Band Wi-Fi, automatically switching between the 2.4 or 5GHz network for the strongest connection.

Here's a look at the premium hardware capabilities:

Feature	Ultra Series (4K)	Pro Series (2K)	Indoor Camera
Maximum Resolution	4K with HDR	2K HDR	Varies (HD/2K options)
Field of View	180°	160° wide	360° pan & 180° tilt
Key AI Feature	Auto-Zoom & Tracking	Motion Detection & Alerts	Auto Motion Tracking
Audio	Premium 2-Way Audio with wind/noise cancellation	2-Way Audio	Motion & Audio Alerts

Intelligent, actionable alerts via Arlo Secure 6 AI-driven object recognition

The value isn't just in the picture; it's in what the picture means. Arlo Secure 6, the next evolution of the service, leverages Arlo Intelligence to filter out noise and provide context. This means you get alerts that matter, allowing for quicker, appropriate responses to potential emergency events.

The AI capabilities in Arlo Secure 6 include:

• Advanced Audio Detection: Identifying specific sounds like screams, gunshots, glass breaking, and smoke/CO alarms.
• Fire Detection: AI-powered notifications upon detecting flames.
• Object Recognition: Smart Detection for people, vehicles, and packages.
• AI Event Captions: Streamlining life with AI-generated descriptions of video events.

Comprehensive, integrated security ecosystem (cameras, doorbells, sensors) on one app

You get control over your entire security setup from one place, the Arlo Secure App. This ecosystem includes a range of devices, from cameras and video doorbells to floodlights and security systems, all managed centrally. The platform supports custom settings like auto-arming when you leave a geofence.

The success of this integrated, services-first approach is clear in the financials as of Q3 2025:

Metric	Value (Q3 2025)	Year-over-Year Growth
Annual Recurring Revenue (ARR)	$323 million	33.8%
Subscriptions and Services Revenue	$79.9 million	29.2%
Cumulative Paid Accounts	5.4 million	27.4%
Subscriptions Gross Margin (Non-GAAP)	85.1%	Up 770 basis points

Honestly, that subscription gross margin of over 85% shows where the real financial value is being created.

Professional monitoring and emergency response services (Arlo Safe)

For elite-level protection, the service tier includes 24/7 Professional Monitoring. This isn't just a notification; it's a direct line for backup when seconds count. The service provides 24/7 Emergency Response, allowing you to contact police, fire, or medical help with one tap, sending prefilled information like gate codes for faster access.

The premium service tier, which includes this monitoring, builds on the base subscription. For context, Arlo Technologies, Inc. (ARLO) reported that the average customer stays with Arlo services for more than 7 years, and subscription plans start at $17.99/month (billed annually) before factoring in the professional monitoring add-on.

Finance: draft 13-week cash view by Friday.

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Customer Relationships

You're looking at how Arlo Technologies, Inc. keeps its customers engaged, which is now heavily weighted toward its services, not just the hardware you buy. The relationship is designed to be sticky, moving from a one-time transaction to a continuous service agreement.

Automated and self-service via the Arlo mobile application and online community.

The primary interface for the customer relationship is the Arlo mobile application, which handles everything from device setup to feature access. This digital-first approach is essential for scaling, as it minimizes the direct cost of service delivery per user. The online community serves as a peer-to-peer support layer, deflecting simple inquiries away from direct support channels.

Dedicated customer support channels (phone, chat, email) for technical issues.

While self-service is the first line, Arlo Technologies, Inc. maintains dedicated channels for when things go wrong or for complex technical escalations. These channels support the premium nature of the Arlo Secure service, ensuring that users experiencing issues with their smart home security platform receive timely resolution.

High-touch relationship with strategic partners like ADT for B2B growth.

The relationship extends beyond the end-user to significant strategic alliances. The collaboration with ADT, the largest security company in North America, signed in June 2025, represents a high-touch B2B relationship. This deal is structured to integrate Arlo Technologies, Inc.'s AI security services into ADT's installed base, which is reported to be over 10M+ systems, with material upside expected for Arlo Technologies, Inc.'s subscription revenue starting in 2026. This type of partnership requires deep integration and dedicated account management.

Subscription-based model fostering long-term, continuous engagement.

The entire customer relationship strategy hinges on converting hardware buyers into long-term subscribers for Arlo Secure. This is evidenced by the financial metrics showing services now dominate the revenue mix and profitability profile. For instance, in Q3 2025, subscriptions and services accounted for 57.3% of total revenue, with services revenue hitting $79.9 million, a 29.2% year-over-year increase.

The success of this model is reflected in the key performance indicators (KPIs) that measure engagement and retention:

• Paid accounts reached 5.396 million by the end of Q3 2025, a 27.4% year-over-year increase.
• Annual Recurring Revenue (ARR) accelerated to $323.2 million as of Q3 2025, marking 33.8% year-over-year growth.
• Average Revenue Per User (ARPU) was reported as over $15 per month in Q3 2025.
• Customer Lifetime Value (LTV) is estimated to be over $870.
• Monthly churn is reported as just 1.0%, indicating superior retention.
• The average customer tenure is stated to be more than 7 years.

The high profitability of this engagement is clear, with the non-GAAP subscriptions and services gross margin expanding to 85.1% in Q3 2025.

Here's a snapshot of the subscription performance driving this relationship as of Q3 2025:

Metric	Value (Q3 2025)	Year-over-Year Change
Annual Recurring Revenue (ARR)	$323.2 million	+33.8%
Total Paid Accounts	5.396 million	+27.4%
Subscriptions & Services Revenue	$79.9 million	+29.2%
Non-GAAP Services Gross Margin	85.1%	+770 basis points
Average Revenue Per User (ARPU)	Over $15 per month	Increasing

The full-year 2025 guidance for service revenue was raised to above $310 million. This entire structure is designed to make the recurring service the most valuable part of the customer journey, so the relationship is defintely built to last.

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Channels

Direct-to-Consumer (D2C) sales via Arlo.com website.

The D2C channel contributes to the overall paid account base, which stood at $5.396$ million at the end of Q3 2025, representing a $27.4\%$ year-over-year increase.

Major e-commerce platforms, notably Amazon.

E-commerce and retail channels collectively drive product sales and new service sign-ups. Management noted that growing shelf space at major retailers, especially Walmart, contributed to higher unit velocity and broader market reach.

Global retail chains for physical product sales (e.g., Best Buy, Costco).

The performance across channels is reflected in the overall revenue mix for Q3 2025, where subscriptions and services accounted for a majority share.

Revenue Component	Amount (Q3 2025)	Percentage of Total Revenue (Q3 2025)
Total Revenue	$139.529$ million	$100\%$
Subscriptions and Services Revenue	$79.9$ million	$57.3\%$
Product Revenue	$\sim\$59.6$ million	$\sim42.7\%$

The product segment saw unit sales growth of $\sim29\%$ year-over-year in Q3 2025, supported by new product Bill of Materials (BOM) cost reductions ranging from $20$ to $35\%$.

Telecommunications and security service providers (e.g., ADT partnership).

Strategic partnerships are a key channel for driving future service revenue growth.

• In the retail and direct channel, the Average Revenue Per User (ARPU) was over $\$15$ per month in Q3 2025.
• The Lifetime Value (LTV) of each user in these channels grew to over $\$870$ as of Q3 2025.
• International revenue represented $42\%$ of total revenue in Q3 2025, at $\$58$ million.
• A strategic partnership with ADT is expected to provide material upside to subscriptions and services revenue starting in 2026.

Finance: draft 13-week cash view by Friday.

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Customer Segments

You're looking at how Arlo Technologies, Inc. (ARLO) divides up its market as of late 2025. The focus is clearly shifting, with services now driving the bulk of the revenue story, which tells us a lot about who is sticking around and paying for the premium features.

The customer base is fundamentally global, segmented across three primary operational theaters. The Americas remains a core market, though the EMEA region showed significant strength in the prior fiscal year. The APAC region is the smallest piece of the pie, but all three are necessary for the overall scale Arlo is building.

Geographic Segment	Contextual Data Point
Americas	Largest market historically, accounting for 61.4% of 2023 revenue.
EMEA	Showed a significant 34.0% revenue increase in the context of the 2024 10-K.
APAC	Accounted for 5.1% of 2023 annual revenue.

The core consumer segment, which includes tech-savvy homeowners looking for premium performance and renters needing simple, wire-free setups, is measured by paid engagement. This group is what fuels the subscription engine. We see this in the latest figures from the third quarter ended September 28, 2025.

• Cumulative paid accounts reached 5.4 million at the end of Q3 2025.
• This represents year-over-year growth of 27.4% in paid accounts.
• The Annual Recurring Revenue (ARR) hit a record $323.2 million in Q3 2025.
• Average Revenue Per User (ARPU) in the retail and direct channel was over $15 per month.
• The calculated lifetime value (LTV) for each user grew to over $870, a new record.

To be fair, the shift to services means the segment valuing the recurring, high-margin features-like those in the Arlo Secure 6 AI-driven platform-is the most financially important segment right now. Subscriptions and services revenue accounted for 57.3% of total revenues in Q3 2025, with a non-GAAP gross margin of 85.1% in that same quarter. That margin disparity definitely separates the product-only buyer from the platform user.

Beyond the individual consumer, Arlo Technologies, Inc. serves business owners and enterprises through its Arlo SmartCloud offering. This targets a different set of needs, focusing on scalable cloud services for commercial deployment. This segment includes entities that need easy-to-deploy surveillance solutions without building out their own cloud infrastructure.

• Arlo SmartCloud is positioned for hardware companies, automotive companies, and service providers.
• It also targets insurance companies, home builders, smart communities, and smart cities.
• Security solution providers, like Verisure, were a major channel, deriving 43.2% of revenue in 2024.

The company is projecting that the service revenue for the full year 2025 will exceed $310 million, which is growth of over 27% year-over-year. This projection underscores the importance of successfully converting both individual users and business partners into long-term, high-value subscribers. Finance: draft the Q4 2025 revenue forecast based on the current paid account growth rate by next Tuesday.

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Cost Structure

You're looking at the costs Arlo Technologies, Inc. incurs to keep its connected security ecosystem running, which is a mix of physical goods and recurring cloud services. It's not just about manufacturing; the AI platform is a major cost driver.

Cost of Goods Sold (COGS) for Hardware, Impacted by Tariffs and Promotions

The hardware side of the business faced significant pressure in the third quarter of 2025. Honestly, product gross margins were negative for the period, which is a clear signal of cost headwinds. This was directly attributed to a couple of things: the ongoing global tariff environment and planned promotional activities designed to clear out older inventory.

Specifically, management noted that the full quarter impact of tariffs approximated $5 million, which directly depressed product margin. Also, planned promotional spend on End-of-Life (EOL) products contributed to this margin pressure. The overall GAAP gross margin for the company in Q3 2025 was 40.5%, but this blended number hides the negative margin on the hardware component.

Here's a quick look at the cost-related metrics from Q3 2025:

Metric	Value (Q3 2025)	Context
Product Gross Margin	Negative	Due to tariffs and promotions
Estimated Tariff Impact	~$5 million	Impacted product margin in Q3 2025
GAAP Gross Margin (Blended)	40.5%	Total company gross margin
Non-GAAP Gross Margin (Blended)	41.4%	Total company gross margin, adjusted

Significant Investment in Research and Development (R&D) for AI and New Products

Arlo Technologies, Inc. continues to pour resources into its software and AI capabilities, which is central to its value proposition. The investment in Research and Development (R&D) remains substantial to support the launch of new offerings, like the Arlo Secure 6 platform.

For the third quarter of 2025, the reported R&D expense was $18.1 million. This spending is explicitly tied to increasing personnel to support the development and launch of innovative product offerings and the AI-driven security platform. The company is making sure its core intelligence engine stays ahead.

Cloud Service and Data Storage Fees for Managing 5.4 Million Accounts

The cost structure for the services side is much healthier, which is why it is the focus of the business. Arlo Technologies, Inc. ended Q3 2025 with cumulative paid accounts reaching 5.4 million, growing 27.4% year-over-year. Managing the data and processing for this growing base requires significant cloud infrastructure.

While the exact dollar amount for cloud and data storage fees isn't broken out separately from the overall Cost of Revenue for Services, the efficiency is clear. The non-GAAP subscriptions and services gross margin hit a record 85.1% in Q3 2025. This high margin suggests that the variable costs associated with data storage and cloud delivery are well-controlled relative to the subscription revenue generated.

Key service metrics that drive these costs and revenues include:

• Annual Recurring Revenue (ARR) reached $323.2 million as of Q3 2025.
• Average Revenue Per User (ARPU) is cited as over $15 per month.
• The company is processing 50 million events each day through advanced object detection.

Sales, General, and Administrative (SG&A) Costs, Including Marketing and Retail Support

You have to spend money to sell the hardware and acquire those subscribers, so Sales, General, and Administrative (SG&A) costs are a necessary component. Arlo Technologies, Inc. has been focused on maintaining leverage in its go-to-market approach.

Management has successfully kept operating expenses relatively flat compared to revenue growth. They noted that operating expenses have been maintained at roughly $40 million per quarter or less since 2022, even while Annual Recurring Revenue (ARR) grew at a 37% Compound Annual Growth Rate (CAGR) during that same period. This leverage is key to their profitability goals.

The adjusted EBITDA for Q3 2025 was $17.1 million, resulting in an adjusted EBITDA margin of 12.2%. This shows that even with R&D investment and the hardware margin pressure, the overall cost structure allows for solid operating profitability.

For your reference, here are the operating results for Q3 2025:

• Adjusted EBITDA: $17.1 million.
• Adjusted EBITDA Margin: 12.2%.
• Operating Expenses (Proxy for SG&A + R&D): Maintained at ~$40 million or less per quarter.

Finance: draft 13-week cash view by Friday.

Arlo Technologies, Inc. (ARLO) - Canvas Business Model: Revenue Streams

You're looking at how Arlo Technologies, Inc. makes its money, and honestly, it's all about the shift to services. The recurring revenue engine is definitely the star here. Subscriptions and Services revenue hit $79.9 million in the third quarter of 2025. That's a big jump, up 29.2% year-over-year.

This service strength directly feeds the Annual Recurring Revenue (ARR) base, which ended Q3 2025 at $323.2 million. That ARR figure represents growth of 33.8% compared to the prior year. This recurring stream is what allows Arlo Technologies, Inc. to talk about durable, highly profitable revenue, even when the hardware side faces pressure.

To see the split, here's a quick look at the revenue sources for Q3 2025. The total revenue was $139.5 million. The business model clearly favors the software side now, which is the strategic play for margin expansion.

Revenue Component	Q3 2025 Amount (USD)	Percentage of Total Revenue
Subscriptions and Services Revenue	$79.9 million	57.3%
One-time Sales of Hardware Devices	$59.6 million	42.7%

The other major piece is the one-time sales of hardware devices, which includes cameras, doorbells, and security systems. In Q3 2025, this hardware component brought in the remaining $59.6 million of the total $139.5 million revenue. It's important to note that product gross margins were under pressure, reportedly turning negative due to the full-quarter impact of tariffs, which approximated $5 million, plus planned promotional spend on end-of-life (EOL) products. This is why the high-margin subscription business is so critical to the overall financial health.

The subscription segment boasts an exceptionally high gross margin. The non-GAAP subscriptions and services gross margin hit 85.1% in Q3 2025. That's a fantastic 770 basis points increase year-over-year. Even the GAAP services gross margin was strong at 84.5%. The company views the modest decline in product gross margin as part of the cost of customer acquisition, aiming for a best-in-class LTV (Lifetime Value) to CAC (Customer Acquisition Cost) ratio in the range of three times.

Here are some key performance indicators supporting this revenue structure:

• Cumulative paid accounts reached 5.4 million as of Q3 2025.
• The Arlo Secure 6 platform is driving ARPU (Average Revenue Per User) to over $15 per month.
• The LTV of each user grew to over $870, a new record.
• The company launched its largest product update ever, introducing over 100 new SKUs.
• Unit sales were up approximately 29% year-over-year.

Finance: draft 13-week cash view by Friday.