Owlet, Inc. (NYSE: OWLT) 2025 Annual Report: Key Highlights and Investor Implications

Overview and Strategic Progress

Owlet, Inc., a leader in pediatric health technology, has released its 2025 Annual Report, marking a year of significant milestones and operational transformation. The company continued to execute its strategic vision, expanding its subscription ecosystem and growing its international presence. Notably, Owlet surpassed 98,000 subscribers by year-end, an indicator of sustained demand and effective product strategy. This performance led to record results across critical financial metrics.

Financial Performance: Record Revenue and Positive Adjusted EBITDA

• Revenue: Owlet achieved revenue of \$105.7 million for 2025, representing robust year-over-year growth of approximately 35.4%. This surge underscores strong product adoption and expansion into new markets.
• Gross Margin: The company improved its gross margin to 50.6%, a 20 basis point increase despite challenges from global trade headwinds.
• Net Loss: Owlet reported a net loss of \$39.7 million, demonstrating narrowed losses as it advances towards profitability.
• Adjusted EBITDA: For the first time in its history, Owlet reported a full-year positive Adjusted EBITDA of approximately \$2.0 million. This is a significant milestone that signals improved operational efficiency and financial discipline.

The company’s financial position was further strengthened by a successful warrant exchange and a follow-on equity offering in late 2025, enhancing the balance sheet and positioning Owlet to invest further in growth initiatives.

Business Model and Market Position

• Subscription Ecosystem: Expansion of the Owlet360 subscription service and a growing user base are central to Owlet’s recurring revenue model, positioning it for long-term stability and market leadership in pediatric health technology.
• International Scaling: The company continues to scale its operations globally, which diversifies its revenue base but also introduces new regulatory, operational, and economic risks.

Risks and Shareholder Considerations

• Operating History and Profitability: Owlet has a limited operating history at its current scale and continues to report net losses, although it has achieved positive Adjusted EBITDA. There remains uncertainty regarding the company’s ability to maintain profitability.
• Internal Controls: Material weaknesses have been identified in the company’s internal control over financial reporting. Management warns that further weaknesses could be found, potentially resulting in material misstatements or impaired access to capital markets.
• Capital Needs: The report cautions that Owlet may need to raise additional capital to support operations and strategic plans. There is no assurance that financing will be available on acceptable terms, or at all, when needed.
• Legal and Regulatory Exposure: The company is involved in ongoing legal and regulatory proceedings. Adverse outcomes could materially affect its financial condition and operations. Additionally, new product development may be subject to FDA and foreign regulatory approval, creating further uncertainty.
• Product Liability: Like others in the medical device sector, Owlet faces the risk of product liability claims, and current or future insurance coverage may not be sufficient.
• Cybersecurity and IT Risks: System failures or cyberattacks could disrupt operations and negatively impact results.
• Brand and Reputation: The company’s success depends heavily on its reputation and brand, which could be affected by any of the risks outlined above.

Competitive Landscape and Strategy

Owlet identifies the following as primary competitive factors:

• Pricing
• Product support and service
• Effective marketing and education
• Brand recognition
• Breadth and depth of offerings
• Market penetration
• Technological innovation and speed

The company acknowledges the risk of technological obsolescence and emphasizes the importance of ongoing R&D and the successful launch of new products and services.

Shareholder and Market-Sensitive Information

• Public Float and Shares Outstanding: As of June 30, 2025, the aggregate market value of non-affiliate voting and non-voting common equity was approximately \$95.6 million. As of March 2, 2026, 28,160,468 shares of Class A common stock were outstanding.
• Listing Status: Owlet’s Class A Common Stock is listed on the New York Stock Exchange under the symbol “OWLT.”
• Filer Status: The company is a non-accelerated filer, a smaller reporting company, and not an emerging growth company.
• Proxy Statement Notice: Part III of the 10-K will incorporate information from the company’s proxy statement for the 2026 Annual Meeting of Stockholders, to be filed within 120 days of fiscal year end.

Conclusion: Potential Share Price Implications

The company’s record revenue, positive Adjusted EBITDA, and strengthened balance sheet are likely to be viewed positively by investors and could support the share price. However, persistent net losses, ongoing material weaknesses in internal controls, and continued need for capital raise caution. Legal and regulatory risks, as well as exposure to market and cybersecurity threats, remain material overhangs. Investors should monitor the company’s ability to sustain growth, achieve GAAP profitability, and resolve outstanding risks.

Disclaimer: This summary is for informational purposes only and does not constitute investment advice. Investors should review the full Owlet, Inc. 2025 Annual Report and consult with their financial advisors before making any investment decisions. The information above is derived from company filings and may be subject to change, risk, and uncertainties that could materially affect future results.

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