Technology

Life360 reports CY 2023 results

Published

2 years ago

February 29, 2024

SAN FRANCISCO, Feb. 29, 2024 /PRNewswire/ — San Francisco area-based Life360, Inc. (Life360 or the Company) (ASX: 360) today reported audited financial results for the quarter and year ended December 31, 2023. Life360 Co-founder and Chief Executive Officer Chris Hulls said: “We are incredibly proud that more than 61 million monthly active users (MAU) globally enjoy the peace of mind that comes with the location sharing and safety features of Life360. In CY23 we made significant strides in our member experience, showing our users what their family members are up to, whether they’re driving, walking or biking. We put pets and other valuables on the map with Tile, all in the service of our mission to keep people close to the ones they love.

“At the same time we made meaningful progress on our path to profitability as we significantly reduced our net loss, and achieved a major milestone by delivering our first full year of positive Adjusted EBITDA1 and Operating Cash Flow. We are excited to continue building on our leading global position in location sharing, and see exciting opportunities in CY24 and beyond to broaden our reach and deepen engagement with our members. We look forward to bringing the benefits of our subscriptions to more markets globally, and creating new revenue streams that utilize the scale and quality of our member base.

“In 2023, we delivered on our commitment to balance fiscal responsibility and prudent investment to position the business for long-term success. We delivered YoY revenue growth of 33% while GAAP operating expenses increased only 4% YoY. We met or exceeded all of the guidance metrics we provided to the market for CY23.”

Looking forward to CY24, we are excited to announce the creation of a new advertising revenue stream that offers partners unparalleled reach to Life360’s enormous free user base, and more than 20 million daily active users (DAU) connecting with their families and friends. We have consistently spoken of the potential that our investment in the core user experience, and the scaling of our MAU base, would provide for the future. We are encouraged by the success of early testing and see the opportunity to deliver an attractive platform to advertisers, while continuing to provide a great user experience.

CY23 Financial Highlights

Revenue of $305 million, a YoY increase of 33%, in line with guidance of $300 million – $310 million;Core Life360 subscription revenue2 of $200 million, up 52% YoY, ahead of guidance for more than a 50% YoY increase;Net loss of $28.2 million, a $63.5 million improvement from CY22;Positive Adjusted EBITDA of $20.6 million ahead of guidance of $12 million – $16 million, with consistent Positive Adjusted EBITDA delivered in each quarter of CY23;Positive Operating Cash Flow (OCF) of $7.5 million, a $64.6 million improvement versus CY22;Year-end cash, cash equivalents and restricted cash of $70.7 million up from $63.7 million at the end of Q3’23

CY23 Operating Highlights and CY24 Outlook

Significant CY23 operating leverage with revenue growth of $76.2 million on an operating expense increase of $9.6 million, yielding increasing Adjusted EBITDA margins and positive Adjusted EBITDA in each quarter.Global Monthly Active Users (MAU) grew nearly 13 million or 26% to 61.4 million, driven by ongoing investment in our core location sharing experience.International MAU grew 7 million, or 40% YoY to 24.6 million as we increased the speed and responsiveness of the app, and achieved international feature parity with the U.S.Global Paying Circles grew to 1.8 million, up 21% YoY, despite significant price increases implemented in Q3/Q4’22 and Q2’23, underscoring the value our subscribers perceive in the Life360 services. Q4’23 net subscriber additions were 54 thousand.U.S. Average Revenue Per Paying Circle (ARPPC) increased 32% YoY, driven by price increases.International Paying Circles increased 43% YoY to 474 thousand, benefiting from strong growth in both the UK and Australia.Triple Tier Membership launched in the UK in October, with an Australian launch planned for Q2’24.Looking forward to CY24, we are pursuing new value-added revenue streams including advertising, utilizing Life360’s enormous free user base. We expect some set-up costs in the first half of CY24, and a modest revenue contribution in the second half of the year.CY24 guidance: Consolidated revenue of $365–$375 million; Adjusted EBITDA2 of $30 million – $35 million; EBITDA loss of $(8) million – $(13) million; year-end cash balance of $80 million – $90 million.

Adjusted EBITDA is a Non-GAAP measure. For the definition of Adjusted EBITDA and the use of this Non-GAAP measure, as well as a reconciliation of Net Loss to Adjusted EBITDA, refer to the Non-GAAP Financial Measures section below.

Core Life360 subscription revenue is defined as subscription revenue derived from the Life360 mobile application, excluding certain revenue adjustments related to bundled Life360 subscription and hardware offerings, for the reported period.

Key Performance Indicators

(in millions, except ARPPC, ARPPS, and ASP)

2023

2022

% YoY

2023

2022

% YoY

Life360 Core3

Monthly Active Users (MAU) – Global

61.4

48.6

26 %

61.4

48.6

26 %

U.S.

36.8

30.9

19 %

36.8

30.9

19 %

International

24.6

17.6

40 %

24.6

17.6

40 %

Australia

1.9

1.4

36 %

1.9

1.4

36 %

Paying Circles – Total

1.8

1.5

21 %

1.8

1.5

21 %

U.S.

1.3

1.2

14 %

1.3

1.2

14 %

International

0.5

0.3

43 %

0.5

0.3

43 %

Average Revenue per Paying Circle (ARPPC)

$ 124.17

$ 105.79

17 %

$ 121.09

$ 96.95

25 %

Life360 Consolidated

Subscriptions

2.4

2.1

17 %

2.4

2.1

17 %

Average Revenue per Paying Subscription (ARPPS)

$ 102.17

$ 87.54

17 %

$ 99.53

$ 80.63

23 %

Net hardware units shipped (standalone)4

1.7

1 %

4.0

3.6

12 %

Average Sale Price (ASP)

$ 11.50

$ 11.48

— %

$ 13.48

$ 13.47

— %

Annualized Monthly Revenue (AMR)5

$ 274.1

$ 224.4

22 %

$ 274.1

$ 224.4

22 %

Life360 Core metrics relate solely to the Life360 mobile application.

Net hardware units shipped (standalone) represents the number of tracking devices sold during the period, excluding hardware units related to bundled Life360 subscription and hardware offerings, net of returns by our retail partners and directly to consumers.

We use Annualized Monthly Revenue (“AMR”) to identify the annualized monthly value of active customer agreements at the end of a reporting period. AMR includes the annualized monthly value of subscription, data and partnership agreements. All components of these agreements that are not expected to recur are excluded.

Global MAU increased 26% YoY to 61.4 million, with Q4’23 net additions of 3.0 million. U.S. MAU increased 19% YoY, with Q4’23 net adds of 1.4 million. International MAU were 40% higher YoY, with Q4’23 net adds of 1.6 million. Australian MAU increased 36% YoY to 1.9 million.Q4’23 Paying Circle net additions of 54 thousand reflected usual quarterly seasonality and natural churn following Q3’23’s record-breaking growth. U.S. Paying Circles increased 14% YoY despite the effect of price increases implemented from August 2022. Our U.S. Membership plan subscribers comprise Silver 15%, Gold 81% and Platinum 4% of total.International Paying Circles maintained strong momentum, up 43% YoY. The UK delivered a 47% YoY increase in Paying Circles and Australia achieved a 51% YoY increase. Triple Tier Membership launched in the UK in October with plans on track for a Triple Tier launch in Australia in Q2’24.Q4’23 global ARPPC increased 17% YoY and 4% QoQ. The benefit from U.S. price increases implemented from August 2022 saw Q4’23 U.S. ARPPC increase 24% YoY.

Operating Results

Revenue

Three Months Ended December 31,

Year Ended December 31,

2023

2022

2023

2022

($ millions)

(unaudited)

Subscription revenue

$ 59.8

$ 45.4

$ 220.8

$ 153.3

Hardware revenue

21.1

19.6

58.2

47.9

Other revenue

6.1

6.3

25.5

27.1

Total revenue

$ 87.0

$ 71.3

$ 304.5

$ 228.3

Annualized Monthly Revenue – December

$ 274.1

$ 224.4

$ 274.1

$ 224.4

Q4’23 Consolidated subscription revenue increased 32% YoY (including hardware subscriptions) to $59.8 million. Life360 core subscription revenue increased 40% YoY supported by the 21% YoY increase in Paying Circles, and 17% higher ARPPC, as a result of the price increases described above. CY23 Consolidated subscription revenue growth of 44% was underpinned by Core Life360 subscription revenue which increased 52% YoY, ahead of guidance of 50%.Q4’23 Hardware revenue delivered a seasonal uplift versus Q3, increasing 8% YoY to $21.1 million driven by lower returns and channel marketing versus Q4’23. CY23 Non-GAAP hardware revenue6 growth of 14% was in line with guidance, with GAAP hardware revenue growth of 21% benefiting from the contribution from bundling.Q4’23 Other revenue of $6.1 million was in line with the prior period reflecting the terms associated with the single data partnership. CY23 revenue of $25.5 million was in line with guidance of approximately $26 million.December AMR increased 22% YoY, cycling a very strong December 2022 base which included the impact of the U.S. price increases.

Gross Profit

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

($ millions, except percentages)

(unaudited)

Gross Profit

$ 60.1

$ 45.0

$ 222.6

$ 148.6

Gross Margin

69 %

63 %

73 %

65 %

Gross Margin (Subscription Only)

86 %

83 %

86 %

80 %

Q4’23 gross profit margin increased to 69% from 63% in the prior year period, reflecting the improvement in subscription only margins to 86% due to higher pricing. CY23 gross margins increased from 65% to 73% due to higher prices as well as the significant YoY improvement in Hardware gross margins which benefited from successful initiatives and a favorable return adjustment recorded in Q2’23.

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

($ millions)

(unaudited)

Research and development

$ 26.0

$ 25.2

$ 101.0

$ 102.5

Sales and marketing

25.7

22.0

99.1

92.4

Paid acquisition & TV

7.5

5.2

28.9

26.5

Other sales and marketing

7.0

8.1

27.5

34.5

Commissions

11.1

8.7

42.7

31.4

General and administrative

12.8

10.5

52.6

48.1

Total operating expenses

$ 64.5

$ 57.7

$ 252.6

$ 243.0

Life360 Non-GAAP Hardware Revenue is calculated using Hardware Revenue, GAAP. For a reconciliation between Hardware Revenue, GAAP and Non-GAAP Hardware Revenue, refer to the Revenue (GAAP to Non-GAAP reconciliation) section below.

Q4’23 operating expenses increased 12% YoY, largely due to higher general and administrative costs primarily arising from increased accounting costs related to Sarbanes-Oxley compliance, and higher legal expenses. Commissions were higher YoY in line with the growth in subscription revenue. CY23 operating expenses increased 4% for the year, benefiting from a 1% reduction in R&D expenses which reflected cost reduction measures undertaken in Q1’23.

EBITDA and Adjusted EBITDA7

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

($ millions)

(unaudited)

Net Loss

$ (3.1)

$ (12.3)

$ (28.2)

$ (91.6)

EBITDA

(2.0)

(10.3)

(20.8)

(85.2)

Non-GAAP Adjustments

10.9

12.0

41.4

45.1

Adjusted EBITDA

$ 8.9

$ 1.6

$ 20.6

$ (40.1)

Q4’23 delivered a positive Adjusted EBITDA contribution of $8.9 million versus $1.6 million in the prior corresponding period as a result of continued strong subscription revenue growth, higher hardware revenue, improved margins and continuing cost efficiencies. These same drivers supported the $60.7 million improvement in Adjusted EBITDA in CY23.

EBITDA and Adjusted EBITDA are non-GAAP measures. For definitions of EBITDA and Adjusted EBITDA, a description of these non-GAAP measures’ use, and a reconciliation of Net Loss to EBITDA and Adjusted EBITDA, refer to the Non-GAAP Financial Measures section below.

Balance Sheet and Cash Flow

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

($ millions)

(unaudited)

Net cash provided by (used in) operating activities

$ 9.0

$ (2.2)

$ 7.5

$ (57.1)

Net cash provided by (used in) investing activities

(1.0)

2.5

(2.2)

(111.6)

Net cash provided by (used in) financing activities

(0.9)

31.2

(25.0)

27.7

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash

7.1

31.5

(19.7)

(141.0)

Cash, Cash Equivalents, and Restricted Cash at the End of the Period

$ 70.7

$ 90.4

$ 70.7

$ 90.4

Life360 ended Q4’23 with cash, cash equivalents and restricted cash of $70.7 million, with unrestricted cash increasing by $7.1 million from Q3’23. Q4’23 operating cash flow of $9.0 million was offset by $1.0 million used in investing activities related to payments for internally developed software, and $0.9 million used in financing activities related to taxes paid for the net settlement of equity awards, offset by proceeds from the exercise of options.Q4’23 net cash provided by operating activities of $9.0 million was largely in line with Adjusted EBITDA of $8.9 million.In CY23, cash and cash equivalents decreased by $19.7 million from CY22. CY23 operating cash flow of $7.5 million was offset by $2.2 million used in investing activities and $25.0 million used in financing activities.CY23 cash provided by operating activities of $7.5 million saw a differential to Adjusted EBITDA of $20.6 million due to timing of receipts, manufacturing payments, and Q1 restructuring costs.

Earnings Guidance8

For CY24 Life360 expects to deliver the following metrics which include both the early revenue, and set-up costs, for the new advertising business:

Consolidated revenue of $365 million – $375 million, with core Life360 subscription revenue growth of at least 20% YoY;Positive Adjusted EBITDA9 of $30 million – $35 million;EBITDA7 loss of $(8) million to $(13) million;Positive Operating Cash Flow for each quarter of CY24, with the usual seasonal low point in Q1;Year-end cash, cash equivalents and restricted cash of $80 million – $90 million.

The company expects to continue to be Adjusted EBITDA positive on a quarterly basis going forward, and to achieve positive EBITDA in the first half of CY25.

With respect to forward looking non-GAAP guidance, we are not able to reconcile the forward-looking non-GAAP adjusted EBITDA measure to the closest corresponding GAAP measure without unreasonable efforts because we are unable to predict the ultimate outcome of certain significant items, which are fluid and unpredictable in nature. In addition, the Company believes such a reconciliation would imply a degree of precision that may be confusing or misleading to investors. These items include, but are not limited to, litigation costs, convertible notes and derivative liability fair value adjustments, and gains/losses on revaluation of contingent consideration. These items may be material to our results calculated in accordance with GAAP.

Investor Conference Call

A conference call will be held today at 9.30am AEDT, Friday 1 March 2024 (Thursday 29 February U.S. PT at 2.30pm). The call will be held as a Zoom audio webinar.

Participants wishing to ask a question should register and join via their browser h er e. Participants joining via telephone will be in listen only mode.

Dial in details

Australia: +61 2 8015 6011
U.S.: +1 669 444 9171
Other countries: details
Meeting ID: 951 2669 6840

A replay will be available after the call at https://investors.life360.com

Authorization

Chris Hulls, Director, Co-Founder and Chief Executive Officer of Life360 authorized this announcement being given to ASX.

About Life360

Life360 delivers peace of mind for families of all types. The company’s category leading mobile app and Tile tracking devices help members protect the people, pets and things they care about most, with a range of services including location sharing, safe driver reports, and crash detection with emergency dispatch. Life360 is based in San Mateo and has approximately 61 million monthly active users (MAU) located in more than 150 countries. For more information, please visit life360.com and Tile.com.

Life360’s CDIs are issued in reliance on the exemption from registration contained in Regulation S of the US Securities Act of 1933 (Securities Act) for offers of securities which are made outside the US. Accordingly, the CDIs have not been, and will not be, registered under the Securities Act or the laws of any state or other jurisdiction in the US. As a result of relying on the Regulation S exemption, the CDIs are ‘restricted securities’ under Rule 144 of the Securities Act. This means that you are unable to sell the CDIs into the US or to a US person who is not a QIB for the foreseeable future except in very limited circumstances until after the end of the restricted period, unless the re-sale of the CDIs is registered under the Securities Act or an exemption is available. To enforce the above transfer restrictions, all CDIs issued bear a FOR Financial Product designation on the ASX. This designation restricts any CDIs from being sold on ASX to US persons excluding QIBs. However, you are still able to freely transfer your CDIs on ASX to any person other than a US person who is not a QIB. In addition, hedging transactions with regard to the CDIs may only be conducted in accordance with the Securities Act.

Forward-looking statements

This announcement and the accompanying conference call contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Life360 intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements regarding Life360’s intentions, objectives, plans, expectations, assumptions and beliefs about future events, including Life360’s expectations with respect to the financial and operating performance of its business, including subscription revenue, hardware revenue, advertising revenue, other revenue, consolidated revenue and ability to create new revenue streams, such as advertising; Adjusted EBITDA, and operating cash flow; its capital position; future growth; the impact of past price increases on future results of operations and subscriber churn; scaling its MAU base; its ability to continue building on its leading global position and the strategic value and opportunities for global expansion; operating cost savings, including through reduced commissions; as well as Life360’s expectations of any changes to the information disclosed herein. The words “anticipate”, “believe”, “expect”, “project”, “predict”, “will”, “forecast”, “estimate”, “likely”, “intend”, “outlook”, “should”, “could”, “may”, “target”, “plan” and other similar expressions can generally be used to identify forward-looking statements. Indications of, and guidance or outlook on, future earnings or financial position or performance are also forward-looking statements. Investors and prospective investors are cautioned not to place undue reliance on these forward-looking statements as they involve inherent risk and uncertainty (both general and specific) and should note that they are provided as a general guide only and should not be relied on as an indication or guarantee of future performance. There is a risk that such predictions, forecasts, projections and other forward-looking statements will not be achieved. Subject to any continuing obligations under applicable law, Life360 does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date of this announcement, to reflect any change in expectations in relation to any forward-looking statements or any change in events, conditions or circumstances on which any such statements are based.

Although Life360 believes that the expectations reflected in the forward-looking statements and the assumptions upon which they are based are reasonable, Life360 can give no assurance that such expectations and assumptions will prove to be correct and, actual results may vary in a materially positive or negative manner. Forward-looking statements are subject to known and unknown risks, uncertainty, assumptions and contingencies, many of which are outside Life360’s control, and are based on estimates and assumptions that are subject to change and may cause actual results, performance or achievements to differ materially from those expressed or implied by such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include risks related to the preliminary nature of financial results, risks related to Life360’s business, market risks, Life360’s need for additional capital, and the risk that Life360’s products and services may not perform as expected, as described in greater detail under the heading “Risk Factors” in Life360’s ASX and SEC filings, including its Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 29, 2024 and other reports filed with the SEC. To the maximum extent permitted by law, responsibility for the accuracy or completeness of any forward-looking statements whether as a result of new information, future events or results or otherwise is disclaimed. This announcement should not be relied upon as a recommendation or forecast by Life360. Past performance information given in this document is given for illustrative purposes only and is not necessarily a guide to future performance and no representation or warranty is made by any person as to the likelihood of achievement or reasonableness of any forward-looking statements, forecast financial information, future share price performance or any underlying assumptions. Nothing contained in this document nor any information made available to you is, or shall be relied upon as, a promise, representation, warranty or guarantee as to the past, present or the future performance of Life360.

Consolidated Statements of Operations and Comprehensive Loss

(Dollars in U.S. $, in thousands, except share and per share data)

Year Ended December 31,

2023

2022

2021

Subscription revenue

$ 220,794

$ 153,287

$ 86,551

Hardware revenue

58,178

47,884

952

Other revenue

25,546

27,134

25,140

Total revenue

304,518

228,305

112,643

Cost of subscription revenue

30,975

30,659

17,807

Cost of hardware revenue

47,384

45,441

1,340

Cost of other revenue

3,522

3,607

3,621

Total cost of revenue

81,881

79,707

22,768

Gross profit

222,637

148,598

89,875

Operating expenses:

Research and development

100,965

102,480

50,994

Sales and marketing

99,072

92,419

47,473

General and administrative

52,583

48,110

23,670

Total operating expenses

252,620

243,009

122,137

Loss from operations

(29,983)

(94,411)

(32,262)

Other income (expense):

Convertible notes fair value adjustment

(684)

1,786

(511)

Derivative liability fair value adjustment

(116)

1,295

(733)

Other income (expense), net

3,228

(178)

Total other income (expense), net

2,428

3,094

(1,422)

Loss before income taxes

(27,555)

(91,317)

(33,684)

Provision for (benefit from) income taxes

616

312

(127)

Net loss

(28,171)

(91,629)

(33,557)

Net loss per share, basic

$ (0.42)

$ (1.47)

$ (0.65)

Net loss per share, diluted

$ (0.42)

$ (1.50)

$ (0.65)

Weighted-average shares used in computing net loss per share, basic

66,748,542

62,209,545

51,656,195

Weighted-average shares used in computing net loss per share, diluted

66,748,542

62,839,593

51,656,195

Comprehensive loss

Net loss

(28,171)

(91,629)

(33,557)

Change in foreign currency translation adjustment

(6)

—

Total comprehensive loss

$ (28,156)

$ (91,635)

$ (33,557)

Consolidated Balance Sheets

(Dollars in U.S. $, in thousands)

December 31,
2023

December 31,
2022

Assets

Current Assets:

Cash and cash equivalents

$ 68,964

$ 75,444

Restricted cash, current

—

13,274

Accounts receivable, net

42,180

33,125

Inventory

4,099

10,826

Costs capitalized to obtain contracts, net

1,010

1,438

Prepaid expenses and other current assets

15,174

8,548

Total current assets

131,427

142,655

Restricted cash, noncurrent

1,749

1,647

Property and equipment, net

730

393

Costs capitalized to obtain contracts, noncurrent

834

626

Prepaid expenses and other assets, noncurrent

6,848

7,134

Operating lease right-of-use asset

1,014

802

Intangible assets, net

45,441

52,699

Goodwill

133,674

Total Assets

$ 321,717

$ 339,630

Liabilities and Stockholders’ Equity

Current Liabilities:

Accounts payable

5,896

$ 13,791

Accrued expenses and other current liabilities

27,538

27,015

Escrow liability

—

13,274

Convertible notes, current

3,449

3,513

Deferred revenue, current

33,932

30,056

Total current liabilities

70,815

87,649

Convertible notes, noncurrent

1,056

4,060

Derivative liability, noncurrent

217

101

Deferred revenue, noncurrent

1,842

2,706

Other liabilities, noncurrent

723

576

Total Liabilities

$ 74,653

$ 95,092

Commitments and Contingencies

Stockholders’ Equity

Common Stock

Additional paid-in capital

532,128

501,763

Notes due from affiliates

—

(314)

Accumulated deficit

(285,143)

(256,972)

Accumulated other comprehensive income (loss)

(6)

Total stockholders’ equity

247,064

244,538

Total Liabilities and Stockholders’ Equity

$ 321,717

$ 339,630

Consolidated Statements of Cash Flows

(Dollars in U.S. $, in thousands)

Year Ended December 31,

2023

2022

2021

Cash Flows from Operating Activities:

Net loss

$ (28,171)

$ (91,629)

$ (33,557)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

9,141

9,199

876

Amortization of costs capitalized to obtain contracts

2,125

2,928

4,014

Amortization of operating lease right-of-use asset

842

—

Stock-based compensation expense

38,512

34,680

11,754

Compensation expense in connection with revesting notes

(87)

184

Non-cash interest expense, net

462

474

166

Convertible notes fair value adjustment

684

(1,786)

511

Derivative liability fair value adjustment

116

(1,295)

733

(Gain)/loss on revaluation of contingent consideration

—

(5,279)

3,600

Non-cash revenue from investment

(1,608)

(1,504)

—

Inventory write-off

916

—

Adjustment in connection with membership benefit

(2,172)

—

Changes in operating assets and liabilities, net of acquisitions:

Accounts receivable, net

(9,055)

6,474

(2,689)

Prepaid expenses and other assets

(6,667)

10,629

(943)

Inventory

5,811

(497)

(859)

Costs capitalized to obtain contracts, net

(1,905)

(3,343)

(1,713)

Accounts payable

(7,895)

(12,654)

559

Accrued expenses and other current liabilities

2,193

(7,722)

4,720

Deferred revenue

4,620

4,660

1,671

Other liabilities, noncurrent

(498)

(303)

(1,180)

Net cash provided by (used in) operating activities

7,524

(57,055)

(12,153)

Cash Flows from Investing Activities:

Cash paid for acquisitions, net of cash acquired

—

(110,933)

(2,983)

Internal use software

(1,715)

(701)

—

Purchase of property and equipment

(506)

—

(81)

Cash advance on convertible note receivable

—

(4,000)

Net cash used in investing activities

(2,221)

(111,634)

(7,064)

Cash Flows from Financing Activities:

Indemnity escrow payment in connection with an acquisition

(13,128)

—

Proceeds from the exercise of options

5,811

2,394

3,543

Taxes paid related to net settlement of equity awards

(14,033)

(4,077)

(4,725)

Proceeds from repayment of notes due from affiliates

314

648

—

Payments on borrowings

—

(41)

Repayment of convertible notes

(3,919)

(3,471)

—

Proceeds from capital raise, net of transaction costs

—

32,215

193,064

Cash received in advance of the issuance of convertible notes

—

2,110

Net cash provided by (used in) financing activities

(24,955)

27,709

193,951

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash

(19,652)

(140,980)

174,734

Cash, Cash Equivalents and Restricted Cash at the Beginning of the Period

90,365

231,345

56,611

Cash, Cash Equivalents, and Restricted Cash at the End of the Period

$ 70,713

$ 90,365

$ 231,345

Year Ended December 31,

2023

2022

2021

Supplemental disclosure:

Cash paid during the period for taxes

$ 697

$ —

$ 33

Cash paid during the period for interest

640

514

Non-cash investing and financing activities:

Fair value of stock issued in connection with an acquisition

—

15,409

13,821

Fair value of convertible debt issued in connection with an acquisition

—

11,597

Fair value of contingent consideration issued in connection with an acquisition

—

5,900

Fair value of vested options assumed in connection with an acquisition

—

533

Forgiveness of convertible debt receivable in connection with an acquisition

—

4,023

Relative fair value of warrants issue with convertible debt

—

844

Beneficial conversion feature related to convertible debt

—

603

Fair value of bifurcated derivative related to convertible debt

—

663

Fair value of warrants held as investment

—

5,474

—

Fair value of stock issued in settlement of contingent consideration

—

4,221

—

Right of use asset recognized in connection with lease modification

1,054

—

Operating lease liability recognized in connection with lease modification

1,054

—

Total non-cash investing and financing activities

$ 2,108

$ 25,104

$ 37,984

Non-GAAP Financial Measures

We collect and analyze operating and financial data to evaluate the health of our business, allocate our resources and assess our performance.

EBITDA and Adjusted EBITDA

In addition to total revenue, net loss and other results under GAAP, we utilize non-GAAP calculations of earnings before interest, taxes, depreciation and amortization (“EBITDA”) and adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). EBITDA is defined as net loss, excluding (i) convertible notes and derivative liability fair value adjustments, (ii) provision for income taxes, (iii) depreciation and amortization and (iv) other income, net. Adjusted EBITDA is defined as net loss, excluding (i) convertible notes and derivative liability fair value adjustments, (ii) provision for income taxes, (iii) depreciation and amortization, (iv) other expense, net, (v) stock-based compensation, (vi) Form 10 transaction costs, (vii) acquisition and integration costs, (viii) workplace restructuring costs, (ix) inventory write-offs, (x) adjustment in connection with membership benefit, (xi) warehouse relocation costs and (xii) gain on revaluation of contingent consideration.

The above items are excluded from EBITDA and Adjusted EBITDA because these items are non-cash in nature, or because the amount and timing of these items are unpredictable, are not driven by core results of operations and render comparisons with prior periods and competitors less meaningful. We believe EBITDA and Adjusted EBITDA provide useful information to investors and others in understanding and evaluating our results of operations, as well as providing useful measures for period-to-period comparisons of our business performance. Moreover, we have included EBITDA and Adjusted EBITDA in this media release because they are key measurements used by our management team internally to make operating decisions, including those related to operating expenses, evaluate performance, and perform strategic planning and annual budgeting. However, these non-GAAP financial measures are presented for supplemental informational purposes only, should not be considered a substitute for or superior to financial information presented in accordance with GAAP, and may be different from similarly titled non-GAAP financial measures used by other companies. As such, you should consider these non-GAAP financial measures in addition to other financial performance measures presented in accordance with GAAP, including various cash flow metrics, net loss and our other GAAP results.

The following table presents a reconciliation of net loss, the most directly comparable GAAP measure, to EBITDA and Adjusted EBITDA:

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

(in thousands)

Net loss

$ (3,146)

$ (12,303)

$ (28,171)

$ (91,629)

Add (deduct):

Convertible notes fair value adjustment

(114)

684

(1,786)

Derivative liability fair value adjustment10

(62)

(112)

116

(1,295)

Provision for income taxes

411

228

616

312

Depreciation and amortization11

2,297

2,368

9,141

9,199

Other expense, net

(1,431)

(614)

(3,228)

(13)

EBITDA

$ (2,045)

$ (10,344)

$ (20,842)

$ (85,212)

Stock-based compensation

10,834

10,193

38,512

34,680

Form 10 transaction costs

—

923

—

3,766

Acquisition and integration costs

—

852

—

11,949

Workplace restructuring costs12

—

4,024

—

Write-off of obsolete inventory13

—

916

—

Adjustment in connection with membership benefit14

—

(2,172)

—

Warehouse relocation costs15

—

121

—

Gain on revaluation of contingent consideration

—

(5,279)

Adjusted EBITDA

$ 8,887

$ 1,624

$ 20,559

$ (40,096)

To reflect the change in value of the derivative liability associated with the July 2021 Convertible Notes.

Includes depreciation on fixed assets and amortization of acquired intangible assets.

Relates to non-recurring personnel and severance related expenses in connection with the workplace restructure announced on January 12, 2023.

Relates to the write-off of raw materials that have no alternative use to the Company following the decision to halt development.

Relates to an adjustment recorded to reduce product costs recorded to cost of revenue in connection with the discontinuation of certain battery related membership benefits.

Relates to non-recurring warehouse relocation costs in relation to the Company’s transition to a new logistics partner.

Key Financial Metrics:

Three Months Ended
December 31,

Year Ended December 31,

2023

2022

2023

2022

(in millions)

(unaudited)

Revenue

U.S. subscription revenue (Non-GAAP)

$ 54.5

$ 40.6

$ 199.4

$ 136.1

International subscription revenue (Non-GAAP)

6.5

4.8

24.5

17.2

Subscription revenue (Non-GAAP)16

61.0

45.2

223.9

153.3

Hardware revenue (Non-GAAP)16

19.8

19.7

54.5

47.8

Other revenue (GAAP)

6.1

6.4

25.5

27.2

Total revenue (Non-GAAP)

87.0

71.3

303.9

228.3

Add: Non-GAAP adjustments related to bundled offerings

—

0.6

—

Total revenue (GAAP)

87.0

71.3

304.5

228.3

Non-GAAP Gross Profit17

62.0

46.4

226.8

153.5

Non-GAAP Gross Margin %17

71 %

65 %

75 %

67 %

Non-GAAP Subscription Gross Margin %

85 %

84 %

81 %

Research and Development (Non-GAAP)

19.6

18.8

76.1

82.5

Sales and Marketing (Non-GAAP)

User acquisition and TV costs

7.5

5.2

28.9

26.4

Other Sales and Marketing

5.1

6.2

19.4

26.0

Commissions

11.1

8.7

42.7

31.4

General & Administrative (Non-GAAP)

9.8

5.9

39.7

28.5

Non-GAAP Operating Expenses18

53.1

44.8

206.8

194.8

Net loss (GAAP)

(3.1)

(12.3)

(28.2)

(91.6)

Adjusted EBITDA (Non-GAAP)

8.9

1.6

20.6

(40.1)

Non-GAAP Adjusted EBITDA Margin %

10 %

2 %

7 %

(18) %

Stock-based Compensation (GAAP)

(10.8)

(10.2)

(38.5)

(34.7)

Other Non-GAAP Adjustments

(0.1)

(1.9)

(2.9)

(10.5)

EBITDA (Non-GAAP)

$ (2.0)

$ (10.4)

$ (20.8)

$ (85.2)

Life360 Non-GAAP Revenue is calculated using GAAP Revenue. For a reconciliation between GAAP Revenue and Non-GAAP Revenue, refer to the Revenue (GAAP to Non-GAAP reconciliation) section in this table.

Non-GAAP Gross Profit is calculated using Revenue, Non-GAAP and Cost of revenue, Non-GAAP. Non-GAAP Gross Margin is calculated by dividing Non-GAAP Gross Profit by Total Revenue (Non-GAAP). For a reconciliation between Total Revenue, GAAP and Total Revenue, Non-GAAP and Total Cost of revenue, GAAP and Total Cost of revenue, Non-GAAP, refer to the Revenue and Cost of Revenue (GAAP to Non-GAAP reconciliation) sections below.

Non-GAAP operating expenses are calculated using Research and Development, Non-GAAP, Sales and Marketing, Non-GAAP and General & Administrative, Non-GAAP expenses. For a reconciliation between Total operating expenses, GAAP and Total operating expenses, Non-GAAP, refer to the Operating expenses (GAAP to Non-GAAP reconciliation) section below.

Revenue (GAAP to Non-GAAP reconciliation):

Q1 2023

Q2 2023

Q3 2023

Q4 2023

(in millions)

Subscription revenue, GAAP included in Adjusted EBITDA

$ 51.7

$ 52.7

$ 56.6

$ 59.8

Bundled offerings19

—

0.7

1.2

Total Subscription revenue, Non-GAAP

$ 51.7

$ 53.4

$ 57.8

$ 61.0

Hardware revenue, GAAP included in Adjusted EBITDA

$ 10.0

$ 11.6

$ 15.5

$ 21.1

Bundled offerings19

—

(1.1)

(1.4)

(1.2)

Total Hardware revenue, Non-GAAP

$ 10.0

$ 10.5

$ 14.2

$ 19.8

The net difference of the bundled offerings represents the GAAP revenue recognition of subscription revenue allocated to hardware revenue which is recognized at a point-in-time rather than ratably over the subscription period. Bundled offerings only represent bundled Life360 subscription and hardware offerings.

Cost of Revenue (GAAP to Non-GAAP reconciliation):

Three Months Ended December 31,

Year Ended December 31,

2023

2022

2023

2022

(in millions)

Cost of subscription revenue, GAAP

$ 8.3

$ 7.9

$ 31.0

$ 30.7

Less: Depreciation and amortization

(0.3)

(1.2)

(0.9)

Less: Stock-based compensation

(0.2)

(0.1)

(0.7)

(0.6)

Less: Severance and other

—

(0.1)

—

Less: Adjustment in connection with membership benefit

—

1.8

—

Non-GAAP Cost of subscription revenue included in Adjusted EBITDA

$ 7.7

$ 7.5

$ 30.8

$ 28.9

Less: Hardware bundling adjustment

1.5

—

4.0

—

Total Cost of subscription revenue, Non-GAAP

$ 9.2

$ 7.5

$ 34.8

$ 28.9

Cost of hardware revenue, GAAP

$ 17.7

$ 17.5

$ 47.4

$ 45.4

Less: Depreciation and amortization

(0.9)

(3.6)

Less: Stock-based compensation

(0.4)

(0.1)

(1.1)

(0.4)

Less: Severance and other

—

(0.2)

(0.1)

Less: Adjustment in connection with membership benefit

—

0.4

—

Non-GAAP Cost of hardware revenue included in Adjusted EBITDA

$ 16.3

$ 16.5

$ 42.9

$ 41.3

Less: Alignment of accounting policies20

—

1.0

Less: Hardware bundling adjustment

(1.5)

—

(4.0)

—

Total Cost of hardware revenue, Non-GAAP

$ 14.8

$ 16.5

$ 38.9

$ 42.3

Cost of other revenue, GAAP

$ 0.9

$ 3.5

$ 3.6

Less: Stock-based compensation

—

(0.1)

—

(0.3)

Total Cost of other revenue, Non-GAAP

$ 0.9

$ 3.5

Cost of revenue, GAAP

$ 26.8

$ 26.3

$ 81.9

$ 79.7

Less: Depreciation and amortization

(1.2)

(4.8)

(4.5)

Less: Stock-based compensation

(0.6)

(0.3)

(1.8)

(1.3)

Less: Severance and other

—

(0.3)

(0.1)

Less: Adjustment in connection with membership benefit

—

2.2

—

Non-GAAP Cost of revenue included in Adjusted EBITDA

$ 24.9

$ 24.8

$ 77.2

$ 73.8

Less: Alignment of accounting policies20

—

1.0

Total Cost of revenue, Non-GAAP

$ 24.9

$ 77.2

$ 74.8

Includes non-recurring costs reflecting the alignment of accounting policies attributable to the integration with Tile. As these adjustments are not deemed to be non-routine or one time in nature, they have not been added back to EBITDA or Adjusted EBITDA.

Operating expenses (GAAP to Non-GAAP reconciliation):

Three Months Ended December 31,

Year Ended December 31,

2023

2022

2023

2022

(in millions)

Research and development expense, GAAP

$ 26.0

$ 25.1

$ 101.0

$ 102.4

Less: Depreciation and amortization

—

(0.1)

—

Less: Stock-based compensation

(6.5)

(6.3)

(22.0)

(19.4)

Less: Severance and other

0.1

—

(2.7)

(0.5)

Total Research and development, Non-GAAP

$ 19.6

$ 18.8

$ 76.1

$ 82.5

Sales and marketing expense, GAAP

$ 25.7

$ 22.1

$ 99.1

$ 92.4

Less: Depreciation and amortization

(1.1)

(4.2)

(4.3)

Less: Stock-based compensation

(0.8)

(0.7)

(3.1)

(3.7)

Less: Severance and other

—

(0.1)

(0.9)

(0.6)

Total Sales and marketing expense, Non-GAAP

$ 23.7

$ 20.2

$ 90.9

$ 83.8

General and administrative expense, GAAP

$ 12.8

$ 10.5

$ 52.6

$ 48.1

Less: Depreciation and amortization

—

(0.1)

—

(0.4)

Less: Stock-based compensation

(2.9)

(11.6)

(10.1)

Less: Severance and other

(0.1)

(1.6)

(1.2)

(9.1)

Total General and administrative expense, Non-GAAP

$ 9.8

$ 5.9

$ 39.7

$ 28.5

Total Operating expenses, GAAP

$ 64.5

$ 57.7

$ 252.6

$ 243.0

Less: Depreciation and amortization

(1.1)

(1.2)

(4.3)

(4.7)

Less: Stock-based compensation

(10.2)

(9.9)

(36.7)

(33.2)

Less: Severance and other

(0.1)

(1.7)

(4.8)

(10.2)

Total Operating expenses, Non-GAAP

$ 53.1

$ 44.9

$ 206.8

$ 194.8

Note: The financial information in this announcement may not add or recalculate due to rounding. All references to $ are to U.S. dollar.

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SOURCE Life360

Technology

Global Times: Head-of-state diplomacy shines at WAIC, fostering ties and advancing global governance consensus

Published

58 minutes ago

July 18, 2026

BEIJING, July 17, 2026 /PRNewswire/ — Chinese President Xi Jinping on Friday held a series of high-level meetings on the sidelines of the 2026 World Artificial Intelligence Conference (WAIC) and High-Level Meeting on Global AI Governance in Shanghai, sitting down successively with Thai Prime Minister Anutin Charnvirakul, Cambodian Prime Minister Hun Manet, and UN Secretary-General António Guterres. The bustling diplomatic activity transformed the WAIC from a premier showcase of AI technologies and industrial breakthroughs into a vibrant platform for head-of-state diplomacy and global governance coordination.

Analysts said hosting intensive head-of-state diplomatic events in Shanghai, a core hub of reform, opening-up and technological innovation, carries profound meaning. In addition, Friday’s high-level meetings embody the innovative model of “technology builds the stage while diplomacy takes the leading role.” It not only deepens China’s bilateral relations with ASEAN members, but also helps advance inclusive global AI governance centered on the UN mechanism.

Strategic guidance

According to the two separate official releases by Xinhua, during his meetings with the prime ministers of Thailand and Cambodia, President Xi spoke of the long-standing friendship China shares with both nations. He called on China and Thailand, as well as China and Cambodia, to join hands to advance the development of their respective communities with a shared future.

Furthermore, the Chinese leader stressed the need for China to expand pragmatic cooperation with Thailand and Cambodia respectively across traditional and emerging sectors, and work with each country to jointly crack down on cross-border crimes such as online gambling and telecom fraud, according to Xinhua.

He called for the proper handling of border frictions between Thailand and Cambodia and called on the two sides to resolve disputes through dialogue and consultation, with China standing ready to continue playing a constructive role in this regard, per Xinhua.

During their respective meetings with the Chinese leader, the prime ministers of Thailand and Cambodia both expressed willingness to deepen multi-field cooperation with China and spoke highly of China’s positive efforts to facilitate the peaceful settlement of the Thailand-Cambodia border conflicts.

Xu Liping, Director of the Center for Southeast Asian Studies at the Chinese Academy of Social Sciences, told the Global Times that head-of-state diplomacy has charted the fundamental course for the advancement of China’s ties with both Cambodia and Thailand.

WAIC exemplifies the innovative model of “technology builds the platform, while diplomacy takes the leading role,” said Xu, “In addition, AI cooperation is also expected to serve as a vital entry point to further deepen and substantiate China’s ties with Thailand and Cambodia going forward.”

Furthermore, addressing the sensitive and thorny Thailand-Cambodia border dispute amid the relatively relaxed atmosphere of a tech summit enables all relevant parties to handle differences in a rational and pragmatic manner, which embodies Eastern wisdom and an Asian approach to resolving issues, said Xu.

The year 2026 marks the fifth anniversary of the establishment of the China-ASEAN comprehensive strategic partnership, witnessing the official rollout of the new Plan of Action on the China-ASEAN Comprehensive Strategic Partnership (2026-2030). It also kicks off the implementation of China’s 15th Five-Year Plan.

The critical juncture offers a perfect window to align China’s development plans closely with the national development strategies of Global South countries and ASEAN members, said Xu. “Thailand and Cambodia’s willingness to ramp up cooperation with China mirrors the aspiration of the majority of ASEAN members to leverage China’s development dividends and pursue win-win outcomes and common prosperity in the region.”

Firm support for UN

In his meeting with UN Secretary-General Antonio Guterres on Friday, Xi reiterated China’s firm support for the UN.

Noting that this year marks the 55th anniversary of the restoration of the lawful seat of the People’s Republic of China at the UN, the Chinese leader said China has since been committed to building world peace, contributing to global development, defending international order, and firmly supporting the UN, Xinhua reported.

Xi added that he proposed the vision of building a community with a shared future for humanity and the four global initiatives with one important consideration in mind – to uphold the status and authority of the UN.

Currently, the international landscape is marked by more pronounced changes and turbulence, making it all the more necessary to practice true multilateralism and reinvigorate the status and role of the UN, he said.

Guterres commended China for its steadfast support for multilateralism, the cause of the UN, and international cooperation, saying that China has set an example for the world.

Guterres said the UN will continue to strengthen cooperation with China, oppose unilateralism, protectionism, and hegemonic bullying, safeguard the UN Charter and international law, as well as advance the process toward a multipolar world.

At this pivotal juncture where talks on AI development and UN multilateral governance converge, China, leveraging head-of-state diplomacy as a top-tier platform, has elaborated in a systematic manner its vision for global governance in the AI era, Wang Yiwei, a professor at the School of International Studies, Renmin University of China, told the Global Times.

He added that China’s emphasis on the UN-centered global governance architecture will further strengthen the UN’s authority and operational capacity.

Before the official opening of the WAIC, on Thursday, representatives from 29 countries, including Kazakhstan, Laos, Pakistan, Russia and Indonesia, signed an agreement on establishing the World Artificial Intelligence Cooperation Organization (WAICO) in Shanghai. UN chief Guterres was among representatives from countries and international organizations present at the signing ceremony.

According to the agreement, WAICO will be an independent intergovernmental international organization, which aims to promote international cooperation and global governance on AI, ensuring that AI is beneficial, safe and fair, thereby promoting its healthy and orderly development to benefit all humanity.

President Xi on Friday also announced that in the next five years, China will provide developing countries with 5,000 opportunities in AI training and seminar programs. China will also develop international AI application cooperation centers with the ASEAN, the League of Arab States, the African Union, the Community of Latin American and Caribbean States, the Shanghai Cooperation Organization, and BRICS.

However, some international media, including Reuters and Nikkei, used the term “AI diplomacy” describing the grand gathering in Shanghai, claiming that Beijing seeks a new global AI order, challenging US dominance.

In rebuttal, Wang pointed out that China advocates open, inclusive technology that lets AI benefit all humanity under the vision of “AI for All”. In contrast, the US adheres to a mindset of “All for AI”, weaponizing AI for geopolitical rivalry and aiming to outpace China in technological competition. Driven by the “America First” doctrine and capital-centric priorities, Washington’s approach forms a sharp contrast with China’s.

Meanwhile, China’s resolute commitment to upholding the UN system underscores that for China and a wide array of Global South countries, the sensible path lies in reforming and improving the existing global governance architecture rather than discarding it to build parallel institutions from scratch, the expert added.

This article first appeared on Global Times

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SOURCE Global Times

Technology

Global Times: China sends fresh signal on global AI cooperation at WAIC

Published

58 minutes ago

July 18, 2026

BEIJING, July 17, 2026 /PRNewswire/ — “AI development should not be a solo performance by a single country, but a symphony of international cooperation,” Chinese President Xi Jinping said on Friday while addressing the opening ceremony of the 2026 World AI Conference (WAIC) and High-Level Meeting on Global AI Governance, stressing that China is ready to be more open, take more practical actions, and assume a more visionary perspective.

We are ready to work with all parties to seize the opportunities of AI development and meet the challenges, and join hands to create a brighter future for humanity, he added.

Xi’s remarks received positive responses from domestic and foreign enterprises and experts, as they spoke highly of China’s scientific and technological achievements in recent years while noting that China’s commitment to openness and cooperation can help ensure that the benefits of AI are shared by all humanity and Chinese solutions in AI governance enable other countries to better tackle the common challenges brought about by AI development.

Openness and win-win cooperation

Xi presented four observations on AI development and governance in the speech. The Chinese leader called for adhering to the principle of openness and win-win cooperation while boosting innovation-driven development. He highlighted the importance of encouraging open-source, openness, collaboration and sharing to facilitate technological innovation, industrial development and scenario-based application of AI.

He also called for strengthening risk-awareness and ensuring that AI is secure and controllable. Stressing the need to ensure that AI is always under human control, Xi urged all sides to jointly oppose overstretching the national security concept in the field of AI or placing one country’s security over that of others.

Third, he called for encouraging inclusiveness and promoting mutual learning among civilizations.

Fourth, he called for advocating solidarity and improving global governance. The important role of the United Nations should be recognized, Xi said, calling for further alignment and coordination on AI development strategies, governance rules and technical standards.

“We must carry out extensive international cooperation and help Global South countries with capacity building to bridge the AI and digital divides, promote sustainable development and prevent creating new historical injustice in AI,” he said.

In the next five years, China will provide developing countries with 5,000 opportunities in AI training and seminar programs, Xi said. He said China will develop international AI application cooperation centers with the Association of Southeast Asian Nations, the League of Arab States, the African Union, the Community of Latin American and Caribbean States, the Shanghai Cooperation Organization, and BRICS. China will enable 30 countries to use the AI-powered meteorological warning system, or MAZU, to safeguard homes around the world.

“President Xi’s remarks underscore China’s commitment to advancing global AI governance and technological innovation through opening-up and win-win cooperation, bringing new opportunities for sharing AI dividends and achieving shared prosperity to countries worldwide, especially developing countries,” Song Yang, professor of School of Economics and research fellow at the National Academy of Development and Strategy at Renmin University of China, told the Global Times on Friday.

China is sending a clear and important message: AI should become a bridge between countries, not a new dividing line, Luigi Gambardella, president of the Brussels-based international digital association ChinaEU, told the Global Times on Friday on the sidelines of the forum.

“No country, however technologically advanced, can develop and govern AI alone. China’s commitment to openness and cooperation can help ensure that the benefits of AI are shared by all humanity. It can help prevent the fragmentation of technologies, standards and markets, while ensuring that the opportunities created by AI are shared more widely,” Gambardella said.

“President Xi proposed ‘adhering to the principle of openness and win-win cooperation’ and ‘advocating solidarity’, and announced a series of pragmatic measures to support global AI development. These remarks have deeply inspired me and further strengthened my confidence in promoting the inclusive development of AI through opening-up and cooperation,” Xu Li, chairman and CEO of Shanghai-based AI software company SenseTime, told the Global Times on Friday.

Looking ahead, SenseTime aims to bring more field-tested technologies, products, and talent cultivation expertise to more countries and regions, and boost “China innovation” to deliver sustained value across a wider spectrum of industrial scenarios, thereby enabling AI to better benefit all of humanity, Xu said.

China actively supports strengthening global cooperation on AI governance, advocates multilateralism, and promotes the establishment of a global governance framework, which has received positive responses from many Global South countries.

Twenty-nine countries on Thursday signed an agreement in Shanghai on establishing the World Artificial Intelligence Cooperation Organization (WAICO). As an independent intergovernmental international organization headquartered in Shanghai, WAICO will uphold the purposes of the UN Charter, be committed to extensive consultation and joint contribution for shared benefit and adhere to a people-centered approach, according to the agreement, per Xinhua.

Global spotlight on WAIC

Since its inception in 2018, the WAIC has successfully convened for eight consecutive editions, becoming an important window for showcasing cutting-edge AI technologies from China and around the world while deepening international opening-up and cooperation.

Themed “AI Partnership for a Brighter Future”, the exhibition area exceeds 100,000 square meters for the first time this year, attracting the participation of over 1,100 enterprises. The exhibitors are showcasing more than 3,000 products and technologies, with over 300 products making their global debuts.

Among the exhibition highlights are Huawei’s latest AI computing super node system Atlas 950, MiniMax M3 multimodal foundation model, and the world’s first agentic AI phone, alongside a range of humanoid robots and AI-powered dexterous hands.

A German BMW representative, who attended WAIC for the first time, expressed enthusiasm about the event, highlighting the humanoid robotics showcased in the exhibition area – technologies he said he has never encountered before.

The representative told the Global Times that his company has adopted Chinese AI-powered large language models such as Qwen and DeepSeek. “The new updated versions of these models emerge weekly, which is very impressive,” the representative said, speaking highly of the cost efficiency of Chinese models.

However, some Western media outlets keep smearing China’s AI advancements and international cooperation. The Economist even claims that China’s open-source AI is a “trap” and that embracing China is “risky.”

Debunking this groundless smearing, Song said that China’s AI development has consistently adhered to the philosophy of a people-centered approach and AI for good, accumulating a wealth of vivid, replicable, and scalable experiences.

At the opening ceremony of the WAIC, the China Meteorological Administration unveiled the MAZU-FengYun Satellite AI Box. The launch marks a new stage in MAZU’s intelligent early-warning initiative, which was unveiled last year, shifting from providing shared meteorological products to delivering AI-enabled forecasting capabilities, according to the administration.

“Over the past year, meteorological and disaster reduction agencies from more than 40 countries have accessed the MAZU early warning technologies and products via cloud platforms. Customized versions of the tool have been deployed in Nigeria, Djibouti, Pakistan, and other nations, earning widespread recognition from users,” You Yang, a staff member with the Shanghai Meteorological Bureau, told the Global Times on Friday.

“From base models to industry-specific applications, China is opening up its low-cost, replicable technological pathways to the world, thereby lowering the threshold for underdeveloped nations to enter the AI era. Meanwhile, China actively helps developing countries address gaps in technology, talent, and governance capabilities to bridge the digital divide in the age of intelligence,” Song said.

According to a March report from Hugging Face, one of the world’s largest AI open-source communities, China has surpassed the US in monthly downloads and overall downloads. In the past year, Chinese models quickly accounted for the plurality or 41 percent of downloads.

“China possesses three unique institutional advantages in promoting AI for good and inclusive development: First, the new system for nationwide mobilization of resources coordinates development and security, achieving synergistic progress in key technological breakthroughs and rule-making. Second, a people-centered approach ensures that technological advancement benefits the people. Third, a multi-stakeholder agile and collaborative governance model links governments, universities, research institutions, enterprises, and social organizations to explore the synergy between rules and technology, providing China’s experience to the world,” Zeng Yi, a member of the UN Advisory Body on AI, told the Global Times on Friday.

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SOURCE Global Times

Technology

Ecopetrol Reports Cybersecurity Incident

Published

58 minutes ago

July 18, 2026

BOGOTA, Colombia, July 17, 2026 /PRNewswire/ — Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) (the “Company”) announced that it has identified an unauthorized access to certain digital resources owned by the Company and its subsidiaries by an external actor who has not been identified, as well as an attempted ransomware attack that was blocked by the cybersecurity controls implemented across the Company and its subsidiaries. The unauthorized access affected cloud-based file storage environments of approximately 15 subsidiaries (including the Company), resulting in the unauthorized download of data associated with approximately 3,300 user accounts. The external actor communicated extortion demands, threatening to publicly disclose the information that had been unlawfully extracted.

In response to this incident, the Company initiated an investigation and activated its incident response and management protocols. In addition, the Company deployed the following measures aimed at preventing the public disclosure of the unlawfully extracted information, addressing supervisory actions and/or potential financial costs associated with investigation, remediation, and regulatory compliance, as follows:

a. Immediate revocation of unauthorized access to the compromised digital assets.
b. Blocking of mechanisms associated with the mass download of information.
c. Identification, analysis, and containment of the tactics, techniques, and procedures (TTPs) used by the malicious actor.
d. Filing of a criminal complaint before the Office of the Attorney General of Colombia and deployment of cooperation activities with specialized national authorities.
e. Identification of external infrastructures used for the storage or download of information to pursue restriction or blocking actions.
f. Activation of support mechanisms with insurers and specialized capital markets teams to ensure the proper management of the event.
g. Detailed assessment of the downloaded information and determination of its criticality.
h. Enhanced monitoring of the technology infrastructure under critical alert protocols and continuous validation of preventive and detective controls.

As of the date of this report, the Company has not identified any material disruption to its critical operations, production capacity, or essential services; any direct financial impact that would prevent it from continuing to conduct its business activities; or any disclosure of the information subject to the unauthorized access. However, the Company continues to assess the potential exposure of corporate information, which could include confidential, restricted, proprietary, or personal data, as it cannot guarantee that this incident will not have a material adverse effect on the Company’s business, reputation, operating results, or financial condition.

Ecopetrol S.A. will continue to monitor developments related to this matter and, should any material facts or information requiring disclosure to the market be identified, will promptly disclose such information in accordance with applicable laws and regulations.

Ecopetrol is the largest company in Colombia and one of the main integrated energy companies in the American continent, with more than 19,000 employees. In Colombia, it is responsible for more than 60% of the hydrocarbon production of most transportation, logistics, and hydrocarbon refining systems, and it holds leading positions in the petrochemicals and gas distribution segments. With the acquisition of 51.4% of ISA’s shares, the company participates in energy transmission, the management of real-time systems (XM), and the Barranquilla – Cartagena coastal highway concession. At the international level, Ecopetrol has a stake in strategic basins in the American continent, with Drilling and Exploration operations in the United States (Permian basin and the Gulf of Mexico), Brazil, and Mexico, and, through ISA and its subsidiaries, Ecopetrol holds leading positions in the power transmission business in Brazil, Chile, Peru, and Bolivia, road concessions in Chile, and the telecommunications sector.

This release contains statements that may be considered forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. All forward-looking statements, whether made in this release or in future filings or press releases, or orally, address matters that involve risks and uncertainties, including in respect of the Company’s prospects for growth and its ongoing access to capital to fund the Company’s business plan, among others. Consequently, changes in the following factors, among others, could cause actual results to differ materially from those included in the forward-looking statements: market prices of oil & gas, our exploration, and production activities, market conditions, applicable regulations, the exchange rate, the Company’s competitiveness and the performance of Colombia’s economy and industry, to mention a few. We do not intend and do not assume any obligation to update these forward-looking statements.

For more information, please contact:

Investor Relations Office
Email: investors@ecopetrol.com.co

Head of Corporate Communications (Colombia)
Marcela Ulloa
Email: marcela.ulloa@ecopetrol.com.co

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SOURCE Ecopetrol S.A.