Latch Stock Declines After Lowering Full Year Revenue Guidance

By Isabella Cheng, Published Aug 16, 2021, 11:25am EDT

Latch's stock price declined ~17% the day after it announced its Q2 2021 earning and lowered full-year revenue guidance.

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However, the company remains bullish as it increased bookings guidance.

In this report, IPVM examines:

  • Lowered full year revenue guidance
  • Supply shortages behind revenue shortfall
  • Q2 2021 revenue
  • Bookings rise
  • Hardware v. software gross margins
  • Comments on customer churn
  • Market reaction

*** *********, ********'* ** **** ********* results*********** **** **********.

Latch **********

***** ** ** ****** control ******* **** **** public ** **** **** through * **** (*******-******* acquisition *******) ********* ** Tishman ******, * ********* commercial ****-****** *******, *** backed ********* ************, * ****-***** **. The ******* ****** ~$*** million *** *** ****** at $*.** ******* ******* doing **** **** $** million ** ******* ** 2020.

*** **** *** ************* in ****** *******, ******** to *** **** ** millions ** ******* ***** access ******* ********* *** raised **********. *** ******** Latch ********, ******** **** ******, ****** ~$500 ******* ** $*.** Billion *********.

Stock *****

***** ***** ******* ~**% the *** ***** ** 2021 ******* **** *********, showing *** ******** ************** with *** ****:

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Company ****** **** **** ******* ********

***** ******* *** **** year *** ******* ******** ~18% **** *** ***** of $** *******-$** ******* USD **** ** $** million-$42 ******* ***, ** its ****** ** **** earnings ****:

** ****, ** *** expect **** **** ******* in *** ***** ** $38 ******* ** $** million, ********** ***% ** 133% ****-****-**** ****** ******** to *** ***** ***** of $** ******* ** $51 *******.

** *****'* *** ********, the ******* **** *** an ********* *********, ********** expecting $** ******* ** the *** ** ****. Latch ********* *** *** revenue ** **** **** 30x **** **** ** 2024:

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**** ************* ***** *** quickly ***** ******* ** grow:

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**** ** *****'* ***** earnings **** ***** ***-*** via **** ** **** 2021.

Labor *** ******** ********* ***** ******* *********

** **** ******* *** less **** ******** ******* of ***** *** ******** material *********, ******** ************:

******** **** ** *** lower *** ** *** second ******* ******** ***** as ** ***** ** see **** ** *** impact ** ***** *** building ********* ********* ** the *** ** *** quarter, **** ******* ** the ***** ** ****. Given *** ******** *** typically ***** *** ***** materials ********* ****** ********** and ************ *** ******* upgrades, ********** ****** *** have ** ******** ****** in ********** *******.

******* ********************* **** ***** ******** cannot ** ********* ** the ***** ** *** completely ***** **** *** customer/builder ****:

*** ****** *** ************ material ********* **** *** broad ****** *** ******** are **** ********** ********* us, ******* ****'** ********* our *********. ******* * give * **** ******** example, ******* *** ******** are *****, **** ** the **** ******** ** be ********* ****** * person ***** **** *** space. ** ***** ** a ******** ** *****, or *****'* * ******** in ********, **** ******** can ****** *** ******** timeline ** **** ** this ******** ******.

******** ***** *** **** able ** ******* ******* it *** ******* **** its *** ****** *****, Schoenfelder ******** **** ***** does *** **** ** much ******* **** *** customers' ****** *********:

******** ****** **** ****** suggests **** **** *** the ***** ***** **** [supply *********] ****** ******* to ****** * *** of *** ********* *** I *****, *** **, it's **** *** ** to ******* ****** **** are ******* ** *** control.

*****'* ********** **** **** in ***** *** ** supply *********:

***** *** *********, ************ towards *** *** ** the *******, ***** ** costs ** **** ** purchase ********** ** **** our ********, *** ***** in *** ******** **** we *** *** ****** so ******** ** *** supply ***** *************, **'** been **** ** ******** to ******* **** ** many ***** ********* **** not **** **** **. So ** *** **** again ** * **** source ** *********** *************** going *******.

***** ** ******** *** construction ****** **** ******** throughout ****, ***** ****** the **** **** ******* guidance:

******** **** ******** **** the ******** ***** ********** some ****** ****** *** end ** *** ****, but ** *** ********* assuming *** ************ ****** process *** *** ********* of ****.

Q2 **** ******* $* ******* ***

*****'* ** **** ******* was ~$* ******* ***, up ***% **** ~$*.* million ** ** ****:

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*** *** ******* *****, Latch *** **** *** annual ******* ********** ** 165%.

Bookings ******** **** *%

** *** ******** **** for *****, *** ******* raised *** ****-**** ******** expectations ~*%. ********** ** the *** ************, ***** expected ~$*** ******* ** booked ******* ** *** end ** ****. ***** now ******* ~$*** *******:

**'** *** ******* *** full-year ***** ******** ************ to *** ***** ** $325 ******* ** $*** million ********** **% ** 105% ****-****-**** ******, ******** to *** ******** ******** range ** $*** ******* to $*** *******.

***** *** **** *** case **** ***** *** bookings *** **** ****** than ** ********* * year *** **** *** fundamentals ** *** ******** are **** ******** ***** eventually, ***** ******** **** turn **** *******, ** delays *** ********. ***********, the ****** *** *** respond ********** ** ***** results.

Gross ******* - ******** ** **%, ******** ********* *** ***** ********

*****'* ******** ***** ******* are ****, ~**%, ***** is ******* *** ******* software:

*** ******** ***** ****** was **% *** *** second *******, * ******** difference ******** ** **% in *** ****** ******* of ****. ** ******* these ******** ******* ******** to *********** *** ******** of *****’* ******** ***** and ********* *** ******** and ******* ******** *****, which ******* *** ** LatchOS *************, ********* *********** first *** ***** ***** hardware *******.

***** ***** ********, ******** gross ******* *** ********* from -**% ** ** 2020 ** -**% ** Q2 ****, **** ***** saying:

** ******* * ****** improvement ** ******** ****** to ******** **% *** the ****** ******* ******** to ******** **%, ** the ****** ******* ** 2020 *** ** **** negative **% * ******* ago. **** *** ******* driven ** ***** ************ and **** **** ********* next ********** ****** ********.

***** ******* ******** ******* to ****** * ******* portion ** ******* *******, which ***** ******** ******* gross *******:

**** ****, ** ****** software ******** ** ******** as * ********** ** our ******* ***, * key ****** *** ****-**** gross ****** *********.

*******, ******** ********* ******** for ~**% ** ***** revenue:

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*******, *****, ** *** IPO ************, ********* **** most ******* **** ***** come **** ********, **** in ****:

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Rival *******

*** ***** ******** ********* for ***** ** **** its***** ********* ** ********** *** *********** ***** to ** ****** **** week, ** ****** ****. The ******** ** ***** into *********, ******** **** its *********** ** ** open ************ *********** ** Latch ***** ******** ***********. We **** ** ******* Smartrent ***** ****** **** week.

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