ARLO Stock Forecast & Price Target

Arlo Technologies Inc. demonstrates a promising outlook driven by its successful transition toward higher product revenue and a strategic focus on expanding recurring revenue streams through its subscription service, Arlo Secure. By emphasizing long-term growth in recurring revenue, the company aims to capitalize on the increasing demand for security and monitoring solutions, which is a top priority for potential customers in the smart home market. Furthermore, the anticipated enhancement of existing product features alongside the subscription model positions Arlo favorably amidst competitive pressures, enabling it to potentially achieve a higher trading multiple in the future.

Arlo Technologies, Inc. reported a concerning gross margin decline to 41.4 percent, marking its lowest in 2025 and raising questions about profitability amidst ongoing operational challenges. The company continues to face issues with inventory management, resulting in delayed customer conversions to paid accounts, which has further exacerbated lagging service revenue relative to annualized recurring revenue (ARR). Additionally, persistent operating losses and potential future costs from partnerships could adversely impact Arlo’s financial results, contributing to an overall negative outlook regarding its stock.