Owlet Posts Record Revenue but Faces Narrowing Margins
Event summary
- Owlet reported Q4 2025 revenue of $26.6M, up 29.6% YoY, with full-year 2025 revenue hitting $105.7M, a 35.4% increase.
- Gross margin declined to 47.6% in Q4 2025 from 53.5% in Q4 2024 due to tariff impacts.
- Owlet360 subscription service surpassed 110,000 paying subscribers.
- 2026 guidance projects revenue of $126M–$130M, with adjusted EBITDA of $3M–$5M.
The big picture
Owlet’s strong revenue growth underscores the demand for smart infant monitoring, but narrowing margins highlight the challenges of scaling a subscription-based model amid tariff pressures. The company’s shift toward a pediatric health platform positions it to compete with broader wellness tech providers, though execution risks remain. With 2026 guidance projecting continued growth, investors will watch closely for signs of operational efficiency improvements.
What we're watching
- Subscription Sustainability
- Whether Owlet can maintain subscriber growth for Owlet360 amid rising competition.
- Margin Recovery
- The pace at which Owlet can offset tariff costs and restore gross margins.
- Global Expansion
- How regulatory clearances will impact Owlet’s international growth strategy.
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