Vivint Smart Home, Inc. (VVNT) Reports Q1 Revenues Miss; Lowers FY20 Revenue Outlook, Reaffirms Adj. EBITDA Guidance

Vivint Smart Home, Inc. (NYSE: VVNT) reported Q1 revenue for the quarter came in at $303.2 million versus the consensus estimate of $307.83 million.

Key Highlights

• Total revenues increased 9.8% year over year to $303.2 million
• Adjusted EBITDAa of $134.9 million compared to $107.3 million in the prior year period
• Net loss of $138.1 million (including $20.9 million of restructuring costs) compared to net loss of $89.2 million in the prior year period
• 1,548,201 Total Subscribers at March 31, 2020, a 7.1% increase year over year
• Reaffirming 2020 Adjusted EBITDA guidance of between $525 and $535 million

“We are pleased with our strong first quarter results, highlighted by improving momentum in new subscriber adds, double-digit revenue growth, and a sharp increase in profitability from the prior year,” said Todd Pedersen, CEO of Vivint Smart Home. “The onset of the COVID-19 pandemic has completely changed life as we know it, and we’ve taken proactive operational measures to protect our employees, our customers and our business. We know from experience that our customers value our services even more during extraordinarily difficult and uncertain times like these. We are confident that our customers will continue to prioritize home security and smart home technology through the current pandemic as well.”

Pedersen continued, “In a time when we’ve been asked to stay at home for an extended period, there may be no better time to have a comprehensive smart home system in place. Our services qualify as essential under the guidelines issued by the U.S. Department of Homeland Security, and we provide a strong sense of safety, comfort and control to nearly 1.6 million customers across North America. Vivint’s services include lifesaving and life-protecting 24/7 professional monitoring for emergency situations such as medical, fire, carbon monoxide and burglary alerts. Our vertically integrated model includes dedicated customer care and monitoring teams to ensure that we respond to these alerts from our customers within seconds. Our cloud platform and proprietary technology enable customers to seamlessly manage and protect their homes, whether they’re sheltering in place or away. We’re focused on taking care of our customers and their families, while providing the peace of mind that they demand during times of heightened awareness and uncertainty.”

GUIDANCE:

Vivint Smart Home, Inc. sees FY2020 revenue of $1.2-1.25 billion, versus the consensus of $1.16 billion.

“We believe that the fundamental characteristics of the Vivint Smart Home financial model are compelling. More than 95% of revenue is recurring, which provides long-term visibility and predictability to our business. The majority of new subscribers enter into five-year contracts and reside on the platform for approximately eight years, driving significant lifetime margin dollars,” said Dale R. Gerard, CFO of Vivint Smart Home. “The corporate landscape throughout the world has been impacted to some degree by the COVID-19 pandemic. While Vivint Smart Home is by no means immune to the historic uncertainties that exist, we feel our business model is well-positioned to withstand the current environment. Given the increased level of uncertainty, and based upon what we are seeing today, we are updating our full year outlook as follows: We expect to end 2020 with approximately 1.55 to 1.62 million subscribers vs. previous guidance of 1.62 to 1.66 million. Our estimate for 2020 revenue is $1.20 to $1.25 billion vs. previous guidance of $1.25 to $1.29 billion. We are reaffirming our prior 2020 Adjusted EBITDA guidance of between $525 and $535 million.”

For earnings history and earnings-related data on Vivint Smart Home, Inc. (VVNT) click here.

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