Shares of Arlo Technologies Inc. ARLO, -5.57% rallied more than 15% in the extended session Tuesday after the maker of home security cameras and other residential security equipment reported a narrower-than-expected first-quarter loss and sales topped Wall Street expectations, helped by the “strong growth” of Arlo’s service business. Arlo said it lost $8.5 million, or 10 cents a share, in the quarter, compared with a loss of $10.7 million, or 13 cents a share, in the year-ago quarter.
Adjusted for one-time items, Arlo earned a penny a share. Revenue rose 51% to $124.8 million, Arlo said. Analysts polled by FactSet expected the company to report an adjusted loss of 3 cents a share on sales of $113 million. “These exceptional Q1 results underline how the powerful combination of our recurring revenue business model, coupled with our successful channel and product diversification, are delivering truly transformative results for Arlo,” Chief Executive Matthew McRae said in a statement. The company added a “record” 205,000 paid accounts in the quarter, up 7.9% over the fourth quarter and 80% year-on-year, Arlo said. Arlo stock ended the regular trading session down nearly 6%.