Owlet Reports 43.1% Revenue Growth to $21.1 Million in Q1 2025

Owlet, Inc. reported a significant increase in its financial performance for the first quarter of 2025, with revenues reaching $21.1 million, a 43.1% increase from $14.8 million in the same period last year. The company attributed this growth primarily to higher sales of its Dream Sock and Dream Duo products, reflecting increased consumer demand. Gross profit also saw a substantial rise, climbing to $11.3 million, up 73% from $6.5 million, resulting in a gross margin improvement from 44.4% to 53.7%. Despite these gains, Owlet recorded an operating loss of $2.7 million, although this was an improvement compared to the $5.7 million loss reported in the prior year.

In terms of operational metrics, Owlet's total current assets increased to $48.4 million as of March 31, 2025, compared to $46.1 million at the end of 2024. The company’s cash and cash equivalents decreased to $16.3 million from $20.2 million, while accounts receivable rose to $16.5 million, indicating a growing customer base and sales volume. The company reported a net income of $3.0 million for the quarter, down slightly from $3.3 million in the previous year, primarily due to increased interest expenses and adjustments related to common stock warrants.

Strategically, Owlet has made significant moves to bolster its financial position, including the issuance of 3.1 million shares of common stock in September 2024, which generated net proceeds of $10.6 million. Additionally, the company entered into a loan facility agreement with WTI Fund X, Inc. and WTI Fund XI, Inc., providing a term loan facility of up to $15 million. As of March 31, 2025, Owlet had $7.5 million drawn from this facility and $8.5 million outstanding under an asset-based revolving credit facility, reflecting a proactive approach to managing its capital structure.

Looking ahead, Owlet faces challenges related to its ongoing operating losses and negative cash flows, which raised concerns about its ability to continue as a going concern. The company reported negative cash flows from operations of $5.9 million for the quarter, compared to $3.4 million in the prior year. Management is focused on addressing these financial conditions through strategic initiatives, including potential additional financing and cost management measures. However, the company cautioned that there can be no assurance of generating sufficient future cash flows to meet its capital requirements, which could impact its operational capabilities and growth prospects.