Life360 revenue hits $128.7m as its pockets $30m from AI data deal

Family tracking company Life360 will pocket about $30.2m from a deal with an Israeli AI company that uses its data to sell insights to developers and town planners.

Life360 founder Chris Hulls.

Life360 has pocketed about $US20m ($30.29m) from the extension of a partnership with an Israeli AI firm that leverages its data to sell insights to property developers, town planners and retail stores.

The tracking app company on Friday announced it had extended the $US20m deal with Placer AI, an Israel-based start-up that sells aggregated data from companies including Life360.

Town planners use the information to develop cities, while retailers use it to decide where to open and close stores.

The company’s chief financial officer Russel Bourke told The Australian the money “was not hugely significant but is part of our overall revenue picture”.

The announcement came as the firm reported second quarter revenue of $US84.9m ($128.7m) over the three months to June 30, representing a 20 per cent year-on-year growth.

Despite the revenue bump, Life360 is still operating at a loss.

The company grew its monthly active user base to 70.6 million, as 4.3 million users became regular users.

Of those, about 2.4 million were Australian, up about 35 per cent.

Life360’s share price shot up 20 per cent to reach $17.84 in early trading on Friday on the back of its earnings result and news of the new partnerships.

Investors and analysts seemed pleased with the company’s addition of 132,000 paid family circles on the platform.

Milford portfolio manager Michael Higgins said “there is a lot to like about Life360’s result”.

“Encouragingly, there was an acceleration in the amount of paying ‘circles’ in Q2 versus Q1, ahead of the seasonally strong back-to-school period in Q3,” he said.

“The advertising opportunity remains significant and Life360 is making good progress.”

InvestorHub co-chief executive Ben Williamson said the Life360’s results “show why many analysts consider them under­valued, with growing subscription numbers and revenue suggesting a clear path to profitability”.

Mr Bourke told The Australian that Life360 was banking on its recent venture into in-app advertisements which would turn into a significant revenue stream.

That play would be significant in markets where the company doesn’t offer premium subscription services, which includes emergency services calling. “We see a huge opportunity in the longer term but it will take some time to build up,” he said. “We’ve just hired a vice-president for ad sales and we’re talking to multiple parties in terms of partnerships with advertising.”

The company’s advertising product was limited to the US, which accounts for about 56 per cent of Life360’s monthly active users. The average paying user spent $US104 over the quarter.

Life360 announced the extension of a second partnership with marketing analytics platform Arity, saying it would help with the growth of its advertising product which would look similar to rideshare giant Uber’s in-app advertisements.

Chief executive Chris Hulls said the company had begun selling ads in June this year, and that Life360 had made “excellent progress in creating new revenue streams from our existing member base”.

“Importantly, we are focused on providing our members with contextually relevant ads that enhance their user experience by leveraging our extensive first-party location data,” he said.