Arlo Expects Up to 25% Q2 Revenue Hit, Product Delays Due to Components Shortages
Components shortages due to the coronavirus will delay Arlo's planned product launches for Q2, said CEO Matthew McRae on the company’s Monday Q4 earnings call. “Numerous” key components used in Arlo’s wireless security cameras are sourced in the affected region…
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in China, said McRae, “and we are now seeing a shortage in these components quickly reduce our anticipated supply.” Component shortages will continue into Q2, he said. The company is working with vendors as factories work on recovery plans, and working with channel partners on “shelf dates,” McRae said, calling the coronavirus impact “temporary.” The company lowered revenue guidance for Q1 by 5-10% to $60 million-$70 million and expects a 20-25% hit in Q2, said Chief Financial Officer Christine Gorjanc. It expects to return to growth in the second half. Arlo added about 324,000 registered accounts to its platform in Q4, bringing the total to nearly 4 million, up 41% year on year; its paid account base grew more than 60% to 230,000, said McRae. Q4 revenue was little changed at $122.4 million.