Owlet Announces Third Quarter 2026 Financial Results; Initiates Camera Cable Guard Safety Update
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Q3 2026 Financial Highlights:
-
Q3 Revenue of
$30.4 million -
Q3 Subscription Revenue of
$3.6 million -
Q3 Gross Margin of
53.8% -
Q3 Operating Income of
$1.2 million -
Q3 Net Income of
$1.4 million -
Q3 Adjusted EBITDA (non-GAAP) of
$3.5 million -
Q3 Operating Cash Inflows of
$2.2 million
“We delivered a strong third quarter, driven by our focus on profitable growth,” said Kurt Workman, Owlet’s President, Chief Executive Officer, and Co-Founder. “Revenue of
Workman continued, “Today, we initiated a safety update for the cable guard accessory included with our cameras. We are providing a replacement enclosed cable guard system that we believe delivers on our commitment to elevating safety standards in the market. We’re starting to ship it today free of charge to every Owlet camera owner upon request. While this update impacts our fourth quarter, we’re confident the long-term opportunity for Owlet remains intact. We’ll share more on today’s conference call.”
Camera Cable Guard Safety Update and Withdrawal of 2026 Financial Outlook
The Company was made aware of a safety incident report involving exposed camera cables. The Company issued an important safety update and action request to all of its camera owners that requires certain safety measures. Due to anticipated remediation expenses, interruption in retail sales during the fourth quarter, retailer returns, and near-term demand uncertainty resulting from this camera cable guard safety update, the Company is withdrawing its previously issued full year 2026 financial outlook. Additional details will be provided in the Company’s upcoming Quarterly Report on Form 10-Q filing for the quarter ended September 30, 2026, and the accompanying conference call and webcast held today.
Financial Results for the Third Quarter Ended September 30, 2026
Revenue for the third quarter of 2026 was
Subscription revenue for the third quarter of 2026 was
Cost of revenue for the third quarter of 2026 was
Subscription gross margin for the third quarter of 2026 was
Operating expenses, including stock-based compensation, were
Operating income was
Net income was
Adjusted EBITDA (non-GAAP) was
Net income per share was
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 expected financial performance, including the Company’s financial outlook; the Company’s camera cable guard safety update, including the expected design, effectiveness, availability, timing and cost of the replacement cable guard system, the expected number of replacement requests, the estimated costs of the update and retailer returns, and the expected timing, accounting and impact of those amounts on the Company’s financial results; potential additional steps in response to the safety incident; expected demand and the Company’s long-term opportunity; and the continued scaling of the Owlet360 subscription service, including subscriber and subscription revenue growth. In some cases, you can identify forward-looking statements by terms such as “estimate,” “may,” “believes,” “plans,” “expects,” “anticipates,” “intends,” “will,” “continues,” “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) the commercial success of Owlet’s products, including its subscription services, market acceptance of new products, the Company’s ability to support, scale and maintain its subscription services, and its ability to cross-sell its products and convert and retain paying subscribers, including following the camera cable guard safety update; (ii) the regulatory classification and status of Owlet’s products, including submissions to, actions taken by and decisions and responses from regulators, such as the FDA and similar regulators outside of
Revision of Previously Issued Financial Statements
In connection with the preparation of the consolidated financial statements as of and for the three and six months ended June 30, 2026, management identified errors impacting historical interim and annual financial statements, which we determined not to be material, individually or in the aggregate, to any previously issued financial statements. These errors primarily relate to the overstatement of stock-based compensation expense due to valuation miscalculations underlying the employee stock purchase plan. We assessed the materiality of the errors on prior period interim and annual consolidated financial statements in accordance with the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin No. 99, “Materiality,” and No. 108, codified in ASC 250, Accounting Changes and Error Corrections (“ASC 250”). Based on this assessment, in consideration of both quantitative and qualitative factors, we determined that the related impacts were not material, individually or in the aggregate, to any previously issued interim or annual financial statements. However, if the corrections were recorded in the three months ended June 30, 2026, they would be material to that period. As such, we revised the previously issued consolidated financial statements for the three-month period ended March 31, 2026, in addition to quarterly and year-to-date periods for 2025 and for the annual periods ended December 31, 2025 and 2024. In conjunction with the revision, we also corrected certain other errors that were previously identified and disclosed and concluded to be immaterial, individually and in the aggregate, to the Company’s consolidated financial statements as of and for the relevant periods. This press release reflects revised prior period financial information for the periods presented herein to correct for these errors. The additional impacted periods noted above were revised in our Form 10-Q for the quarterly period ended June 30, 2026, filed on August 14, 2026.
Disclosure Regarding Non-GAAP Financial Measures
In addition to the financial measures presented in this release in accordance with
The Company uses such non-GAAP financial measures as internal measures of business operating performance and as performance measures for benchmarking against the Company’s peers and competitors. The Company believes its presentation of adjusted EBITDA, adjusted net income (loss) and adjusted net income (loss) per share 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 these non-GAAP financial measures are an important supplemental measure of operating performance because it facilitates period-to-period comparisons of our operating performance by excluding certain items that management believes are not reflective of our core operating performance, highlighting trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. These non-GAAP financial measures should not be construed as indicative of our future operating results. The Company believes investors, analysts and other interested parties use adjusted EBITDA, adjusted net income (loss) and adjusted net income (loss) per share in evaluating issuers, and the presentation of these measures 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 measures should not be considered as an alternative to net income (loss) or net income (loss) per share 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 income (loss) adjusted for income tax provision, interest income (expense), net, depreciation and amortization, impairment of intangible assets, common stock warrant liability adjustment, stock-based compensation, transaction costs, insurance loss recovery related to certain legal matters, net of charges related to certain legal matters, restructuring costs, and loss on debt extinguishment.
Adjusted net income (loss) is defined as net income (loss) adjusted for impairment of intangible assets, common stock warrant liability adjustment, stock-based compensation, transaction costs, insurance loss recovery related to certain legal matters, net of charges related to certain legal matters, restructuring costs, and loss on debt extinguishment. Adjusted net income (loss) per share is defined as adjusted net income (loss) divided by the basic weighted-average number of shares of common stock outstanding.
Adjusted EBITDA, adjusted net income (loss) and adjusted net income (loss) per share are not recognized terms under GAAP, and the Company’s presentation of these non-GAAP measures does not replace the presentation of the Company’s financial results in accordance with GAAP. Because all companies do not use adjusted EBITDA, adjusted net income (loss) and adjusted net income (loss) per share (and similarly titled financial measures) in the same way, those measures as used by other companies may not be consistent with the way the Company calculates such measures. The non-GAAP financial measures included in this release should not be construed as substitutes for or better indicators of the Company’s performance than the most directly comparable GAAP financial measures. See the reconciliation tables that accompany this release for additional information regarding certain of the non-GAAP financial measures included herein.
Conference Call and Webcast Information
Owlet will host a conference call and webcast today, November 13, 2026, at 8:30 a.m. ET to discuss these results and provide a business update.
Participants may access the call at 833-461-5787 (domestic) or 585-542-9983 (international) and reference Meeting ID 892113833. A simultaneous webcast may be accessed online at the Events section of Owlet’s Investor Relations website at investors.owletcare.com. A replay will be available on the Investor Relations website shortly after the webcast concludes.
About Owlet, Inc.
Owlet, Inc. (NYSE: OWLT), a leading pediatric health platform, is the only company in the world to offer
Owlet, Inc. Condensed Consolidated Balance Sheets - Preliminary, Unaudited1 (in millions) |
||||||
Assets |
|
September 30, 2026 |
|
December 31, 2025 |
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
31.6 |
|
$ |
35.5 |
Restricted cash |
|
|
0.3 |
|
|
5.6 |
Accounts receivable, net |
|
|
28.7 |
|
|
22.9 |
Inventory |
|
|
16.3 |
|
|
15.3 |
Prepaid expenses and other current assets |
|
|
3.3 |
|
|
2.7 |
Total current assets |
|
|
80.2 |
|
|
81.9 |
Property and equipment, net |
|
|
1.2 |
|
|
0.3 |
Intangible assets, net |
|
|
2.1 |
|
|
1.4 |
Other assets |
|
|
2.3 |
|
|
2.0 |
Total assets |
|
$ |
85.7 |
|
$ |
85.6 |
Liabilities, Mezzanine Equity, and Stockholders’ Equity |
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Accounts payable |
|
$ |
12.0 |
|
$ |
12.0 |
Accrued and other expenses |
|
|
15.3 |
|
|
19.4 |
Current portion of deferred revenue |
|
|
3.6 |
|
|
2.3 |
Line of credit |
|
|
11.0 |
|
|
6.9 |
Current portion of long-term and other debt |
|
|
— |
|
|
3.6 |
Total current liabilities |
|
|
41.9 |
|
|
44.2 |
Long-term debt, net |
|
|
— |
|
|
2.5 |
Common stock warrant liabilities |
|
|
0.6 |
|
|
3.3 |
Other long-term liabilities |
|
|
0.1 |
|
|
0.2 |
Total liabilities |
|
|
42.6 |
|
|
50.2 |
Total mezzanine equity |
|
|
16.5 |
|
|
16.4 |
Total stockholders’ equity |
|
|
26.5 |
|
|
19.0 |
Total liabilities, mezzanine equity, and stockholders' equity |
|
$ |
85.7 |
|
$ |
85.6 |
1 Amounts may not sum due to rounding
| Owlet, Inc. Condensed Consolidated Statements of Cash Flows - Preliminary, Unaudited1 (in millions) |
|||
|
Nine Months Ended September 30, |
||
|
2026 |
|
2025 |
Net cash used in operating activities |
|
|
|
Net cash used in investing activities |
(2.0) |
|
(0.5) |
Net cash provided by (used in) financing activities |
(4.1) |
|
14.2 |
Net change in cash, cash equivalents, and restricted cash |
|
|
|
1 Amounts may not sum due to rounding
| Owlet, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - Preliminary, Unaudited1 (in millions, except share and per share amounts) |
|||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
Revenue: |
|
|
|
|
|
|
|
||||||||
Hardware |
$ |
26.8 |
|
|
$ |
30.5 |
|
|
$ |
77.3 |
|
|
$ |
76.8 |
|
Subscription |
|
3.6 |
|
|
|
1.5 |
|
|
|
9.5 |
|
|
|
2.8 |
|
Total revenue |
|
30.4 |
|
|
|
32.0 |
|
|
|
86.7 |
|
|
|
79.6 |
|
Cost of revenue: |
|
|
|
|
|
|
|
||||||||
Hardware |
|
12.9 |
|
|
|
15.3 |
|
|
|
33.3 |
|
|
|
37.4 |
|
Subscription |
|
1.1 |
|
|
|
0.5 |
|
|
|
3.0 |
|
|
|
0.8 |
|
Total cost of revenue |
|
14.1 |
|
|
|
15.8 |
|
|
|
36.3 |
|
|
|
38.2 |
|
Gross profit |
|
16.4 |
|
|
|
16.2 |
|
|
|
50.4 |
|
|
|
41.4 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
General and administrative |
|
7.0 |
|
|
|
6.2 |
|
|
|
25.8 |
|
|
|
20.3 |
|
Sales and marketing |
|
4.6 |
|
|
|
4.9 |
|
|
|
15.0 |
|
|
|
13.2 |
|
Research and development |
|
3.6 |
|
|
|
3.8 |
|
|
|
12.1 |
|
|
|
10.4 |
|
Total operating expenses |
|
15.2 |
|
|
|
14.9 |
|
|
|
52.9 |
|
|
|
43.9 |
|
Operating income (loss) |
|
1.2 |
|
|
|
1.3 |
|
|
|
(2.5 |
) |
|
|
(2.6 |
) |
Other income (expense): |
|
|
|
|
|
|
|
||||||||
Interest income (expense), net |
|
0.1 |
|
|
|
(0.9 |
) |
|
|
(1.3 |
) |
|
|
(2.8 |
) |
Common stock warrant liability adjustment |
|
0.1 |
|
|
|
4.3 |
|
|
|
2.7 |
|
|
|
(23.8 |
) |
Other income (expense), net |
|
— |
|
|
|
(0.5 |
) |
|
|
0.9 |
|
|
|
(0.4 |
) |
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
|
(2.2 |
) |
|
|
— |
|
Total other income (expense), net |
|
0.3 |
|
|
|
2.9 |
|
|
|
0.1 |
|
|
|
(27.1 |
) |
Income (loss) before income tax provision |
|
1.5 |
|
|
|
4.2 |
|
|
|
(2.4 |
) |
|
|
(29.6 |
) |
Income tax provision |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
Net income (loss) and comprehensive income (loss) |
$ |
1.4 |
|
|
$ |
4.2 |
|
|
$ |
(2.4 |
) |
|
$ |
(29.7 |
) |
Accretion on convertible preferred stock |
|
(0.8 |
) |
|
|
(0.8 |
) |
|
|
(2.5 |
) |
|
|
(2.5 |
) |
Allocation of net income to participating securities |
|
(0.1 |
) |
|
|
(0.5 |
) |
|
|
— |
|
|
|
— |
|
Allocation of accretion on convertible preferred stock to redeemable common stock |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
Accretion on redeemable common stock |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
Allocation of net income to participating securities to redeemable common stockholders |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Allocation of net (income) loss attributable to redeemable common stockholders |
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
1.0 |
|
Net income (loss) attributable to redeemable common stockholders |
$ |
— |
|
|
$ |
0.1 |
|
|
$ |
— |
|
|
$ |
(1.0 |
) |
Net income (loss) attributable to common stockholders |
$ |
0.5 |
|
|
$ |
2.7 |
|
|
$ |
(5.0 |
) |
|
$ |
(31.2 |
) |
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share attributable to redeemable common stockholders |
|||||||||||||||
Basic |
$ |
0.06 |
|
|
$ |
0.20 |
|
|
$ |
(0.07 |
) |
|
$ |
(1.86 |
) |
Diluted |
$ |
0.05 |
|
|
$ |
0.19 |
|
|
$ |
(0.16 |
) |
|
$ |
(1.86 |
) |
Weighted-average number of shares outstanding used to compute net income (loss) per share attributable to redeemable common stockholders |
|||||||||||||||
Basic |
|
252,500 |
|
|
|
562,500 |
|
|
|
289,038 |
|
|
|
562,500 |
|
Diluted |
|
252,500 |
|
|
|
687,500 |
|
|
|
289,038 |
|
|
|
562,500 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share attributable to common stockholders |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.02 |
|
|
$ |
0.17 |
|
|
$ |
(0.18 |
) |
|
$ |
(1.98 |
) |
Diluted |
$ |
0.01 |
|
|
$ |
(0.05 |
) |
|
$ |
(0.27 |
) |
|
$ |
(1.98 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of shares outstanding used to compute net income (loss) per share attributable to common stockholders |
|||||||||||||||
Basic |
|
28,832,450 |
|
|
|
16,198,439 |
|
|
|
28,259,449 |
|
|
|
15,769,020 |
|
Diluted |
|
29,569,621 |
|
|
|
19,313,512 |
|
|
|
28,331,049 |
|
|
|
15,769,020 |
|
1 Amounts may not sum due to rounding
| Owlet, Inc.
Reconciliation of GAAP to Non-GAAP Measures - Preliminary, Unaudited1 (in millions, except share and per share amounts) |
|||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
GAAP net income (loss) |
$ |
1.4 |
|
|
$ |
4.2 |
|
|
$ |
(2.4 |
) |
|
$ |
(29.7 |
) |
Income tax provision |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
Interest (income) expense, net |
|
(0.1 |
) |
|
|
0.9 |
|
|
|
1.3 |
|
|
|
2.8 |
|
Depreciation and amortization |
|
0.3 |
|
|
|
0.1 |
|
|
|
0.7 |
|
|
|
0.4 |
|
Impairment of intangible assets |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
Common stock warrant liability adjustment |
|
(0.1 |
) |
|
|
(4.3 |
) |
|
|
(2.7 |
) |
|
|
23.8 |
|
Stock-based compensation |
|
2.6 |
|
|
|
1.2 |
|
|
|
9.4 |
|
|
|
4.4 |
|
Transaction costs |
|
— |
|
|
|
0.5 |
|
|
|
— |
|
|
|
0.5 |
|
Insurance loss recovery related to certain legal matters, net of charges related to certain legal matters |
|
(0.7 |
) |
|
|
(1.1 |
) |
|
|
(0.6 |
) |
|
|
0.3 |
|
Restructuring costs |
|
— |
|
|
|
— |
|
|
|
0.7 |
|
|
|
— |
|
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
|
2.2 |
|
|
|
— |
|
Non-GAAP Adjusted EBITDA |
$ |
3.5 |
|
|
$ |
1.6 |
|
|
$ |
8.6 |
|
|
$ |
2.5 |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
GAAP net income (loss) |
$ |
1.4 |
|
|
$ |
4.2 |
|
|
$ |
(2.4 |
) |
|
$ |
(29.7 |
) |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
||||||||
Impairment of intangible assets |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
Common stock warrant liability adjustment |
|
(0.1 |
) |
|
|
(4.3 |
) |
|
|
(2.7 |
) |
|
|
23.8 |
|
Stock-based compensation |
|
2.6 |
|
|
|
1.2 |
|
|
|
9.4 |
|
|
|
4.4 |
|
Transaction costs |
|
— |
|
|
|
0.5 |
|
|
|
— |
|
|
|
0.5 |
|
Insurance loss recovery related to certain legal matters, net of charges related to certain legal matters |
|
(0.7 |
) |
|
|
(1.1 |
) |
|
|
(0.6 |
) |
|
|
0.3 |
|
Restructuring costs |
|
— |
|
|
|
— |
|
|
|
0.7 |
|
|
|
— |
|
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
|
2.2 |
|
|
|
— |
|
Non-GAAP adjusted net income (loss) |
$ |
3.3 |
|
|
$ |
0.5 |
|
|
$ |
6.6 |
|
|
$ |
(0.7 |
) |
Non-GAAP adjusted net income (loss) per share |
$ |
0.11 |
|
|
$ |
0.03 |
|
|
$ |
0.23 |
|
|
$ |
(0.05 |
) |
Weighted-average number of shares outstanding attributable to common stockholders, basic |
|
28,832,450 |
|
|
|
16,198,439 |
|
|
|
28,259,449 |
|
|
|
15,769,020 |
|
1 Amounts may not sum due to rounding
View source version on businesswire.com: https://www.businesswire.com/news/home/20261113019580/en/
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Source: Owlet, Inc.