Analysts Expect Breakeven For Life360, Inc. (ASX:360) Before Long

Life360, Inc. (ASX:360) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Life360, Inc. engages in the manufacture and sale of subscription and hardware tracking devices in North America, Europe, the Middle East, Africa, and internationally. The AU$2.3b market-cap company announced a latest loss of US$28m on 31 December 2023 for its most recent financial year result. Many investors are wondering about the rate at which Life360 will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Life360

Life360 is bordering on breakeven, according to the 8 Australian Software analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$28m in 2026. The company is therefore projected to breakeven around 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 59%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Life360's upcoming projects, however, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 1.8% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Life360, so if you are interested in understanding the company at a deeper level, take a look at Life360's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

1. Valuation: What is Life360 worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Life360 is currently mispriced by the market.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Life360’s board and the CEO’s background.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.