What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-02 compared with 2025-02-27 · 586 added, 488 removed, 779 unchanged (58% of the section changed)

3 unchanged sentences

San Francisco, CA ;

PCAOB ID # 34 and BDO USA, P.C.

San Francisco, CA ;

PCAOB ID # 34 )

1 unchanged sentence

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Operations and Comprehensive Income ( Loss )

Consolidated Statements of Stockholders’ Equity

2 unchanged sentences

Report of Independent Registered Public Accounting Firm

Shareholders and Board of Directors

Life360, Inc.

San Mateo, California

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows of Life360, Inc.

(the “Company”) for the year ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the Company’s results of its operations and its cash flows for the year ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ BDO USA, P.C.

We served as the Company's auditor from 2018 to 2023.

San Francisco, California

March 23, 2023

Report of Independent Registered Public Accounting Firm

To the stockholders and the Board of Directors of Life360, Inc.

1 unchanged sentence

We have audited the accompanying consolidated balance sheets of Life360, Inc.

and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders' equity, and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income (loss), stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 2, 2026, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

26 unchanged sentences

San Francisco, California

February 27, 2025

March 2, 2026

We have served as the Company's auditor since 2023.

6 unchanged sentences

Cash and cash equivalents $ 494,261 $ 159,238

Accounts receivable, net (including related party receivables of $ 55 and $ 0 , respectively)

Accounts receivable, net (1)

80,715 57,997

7 unchanged sentences

Prepaid expenses and other assets, noncurrent (2)(3)

48,480 21,611

Operating lease right-of-use asset 335 683

1 unchanged sentence

Goodwill 134,619 133,674

Deferred tax assets, net

Total Assets $ 959,688 $ 441,580

3 unchanged sentences

Accrued expenses and other current liabilities 42,002 32,015

Convertible notes, current — 3,449

Deferred revenue, current (4)

46,377 39,860

Total current liabilities 96,790 77,338

Convertible notes, noncurrent — 1,056

Derivative liability, noncurrent — 217

Convertible notes, net, noncurrent 310,386 —

Deferred revenue, noncurrent (5)

4 unchanged sentences

Common Stock, $ 0.001 par value;

500,000,000 and 100,000,000 shares authorized as of December 31, 2024 and December 31, 2023, respectively;

500,000,000 shares authorized as of December 31, 2025 and December 31, 2024, respectively;

79,359,589 and 75,404,996 issued and outstanding as of December 31, 2025 and December 31, 2024, respectively

4 unchanged sentences

Total Liabilities and Stockholders’ Equity $ 959,688 $ 441,580

(1) Includes related party receivables of $ 3 and $ 55 as of December 31, 2025 and December 31, 2024, respectively.

(2) Includes $ 24,726 and zero measured using the fair value option as of December 31, 2025 and December 31, 2024, respectively, related to the Convertible Note Investment.

Refer to Note 5, "Fair Value Measurements" for additional information.

(3) The balance as of December 31, 2025 includes the $ 5,882 Related Party Investment and the $ 3,898 Related Party Warrant.

The balance as of December 31, 2024 includes the $ 5,000 Related Party SAFE and the $ 3,898 Related Party Warrant.

Refer to Note 5, "Fair Value Measurements" and Note 15, "Related-Party Transactions" for additional information.

(4) Includes related party deferred revenue, current of $ 780 and $ 877 as of December 31, 2025 and December 31, 2024, respectively.

(5) Includes related party deferred revenue, noncurrent of $ 2,242 and $ 3,021 as of December 31, 2025 and December 31, 2024, respectively.

See accompanying notes to the consolidated financial statements.

Life360, Inc.

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Operations and Comprehensive Income (Loss)

(Dollars in U.S.

3 unchanged sentences

Subscription revenue $ 369,253 $ 277,845 $ 220,794

Hardware revenue (including related party revenue of $ 55 , $ 0 , and $ 0 , respectively)

Hardware revenue (1)

51,816 57,589 58,178

Other revenue (2)

68,412 36,050 25,546

Total revenue 489,481 371,484 304,518

1 unchanged sentence

Cost of hardware revenue (3)

51,175 47,225 47,384

Cost of other revenue 6,496 4,088 3,522

6 unchanged sentences

Total operating expenses 362,016 287,133 252,620

Loss from operations ( 7,976 ) ( 29,983 ) ( 94,411 )

Income (loss) from operations 18,826 ( 7,976 ) ( 29,983 )

Other income (expense):

3 unchanged sentences

Gain on settlement of derivative liability — 1,924 —

Gain on change in fair value of investment 5,389 — —

Gain on change in fair value of investments (4)

Interest income

13,705 6,009 3,083

Other income (expense), net (5)

( 481 ) ( 7,217 ) 145

Total other income (expense), net 13,833 3,350 2,428

Loss before income taxes ( 4,626 ) ( 27,555 ) ( 91,317 )

Income (loss) before income taxes 32,659 ( 4,626 ) ( 27,555 )

Provision for (benefit from) income taxes ( 118,173 ) ( 71 ) 616

Net loss ( 4,555 ) ( 28,171 ) ( 91,629 )

Net loss per share, basic (Note 17) $ ( 0.06 ) $ ( 0.42 ) $ ( 1.47 )

Net loss per share, diluted (Note 17) $ ( 0.06 ) $ ( 0.42 ) $ ( 1.50 )

Weighted-average shares used in computing net loss per share, basic (Note 17) 72,125,571 66,748,542 62,209,545

Weighted-average shares used in computing net loss per share, diluted (Note 17) 72,125,571 66,748,542 62,839,593

Comprehensive loss

Net loss $ ( 4,555 ) $ ( 28,171 ) $ ( 91,629 )

Net income (loss) 150,832 ( 4,555 ) ( 28,171 )

Net income (loss) per share, basic (Note 17) $ 1.95 $ ( 0.06 ) $ ( 0.42 )

Net income (loss) per share, diluted (Note 17) $ 1.77 $ ( 0.06 ) $ ( 0.42 )

Weighted-average shares used in computing net income (loss) per share, basic (Note 17) 77,251,239 72,125,571 66,748,542

Weighted-average shares used in computing net income (loss) per share, diluted (Note 17) 85,172,415 72,125,571 66,748,542

Comprehensive income (loss)

Net income (loss) $ 150,832 $ ( 4,555 ) $ ( 28,171 )

Change in foreign currency translation adjustment 4 35 15

Total comprehensive loss $ ( 4,520 ) $ ( 28,156 ) $ ( 91,635 )

Total comprehensive income (loss) $ 150,836 $ ( 4,520 ) $ ( 28,156 )

(1) Includes related party revenue of $ 195 , $ 55 , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

(2) Includes related party revenue of $ 890 , zero , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

(3) Includes related party cost of revenue of $ 137 , zero , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

(4) Includes a related party gain of $ 882 , zero , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

(5) Includes related party other expense of zero , $ 5,498 , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

See accompanying notes to the consolidated financial statements.

13 unchanged sentences

Exercise of stock options 935,007 1 5,810 — — — 5,811

Exercise of warrants 87,795 — 1 — — — 1

Vesting of restricted stock units 1,980,980 2 ( 2 ) — — — —

Taxes paid related to net settlement of equity awards — — ( 14,033 ) — — — ( 14,033 )

Issuance of common stock in connection with an acquisition 763,183 1 15,408 — — — 15,409

Issuance of common stock net of issuance costs of $ 1,050

2,645,503 3 32,212 — — — 32,215

Repayment of notes due from affiliate — — 78 274 — — 352

Issuance of common stock in settlement of contingent consideration 376,573 — 4,221 — — — 4,221

Stock-based compensation expense — — 38,512 — — — 38,512

Interest accrued relating to notes due from affiliates — — — 40 — — 40

Cancellation of revesting stock ( 75,920 ) — — — — — —

Net loss — — — — ( 91,629 ) — ( 91,629 )

Change in foreign currency translation adjustment — — — — — 15 15

Net loss — — — — ( 28,171 ) — ( 28,171 )

Balance at December 31, 2023 68,155,830 $ 70 $ 532,128 $ — $ ( 285,143 ) $ 9 $ 247,064

Exercise of stock options 758,101 — 5,780 — — — 5,780

Exercise of warrants 129,897 — 1,149 — — — 1,149

Vesting of restricted stock units 2,315,587 2 ( 1 ) — — — 1

Taxes paid related to net settlement of equity awards — — ( 14,033 ) — — — ( 14,033 )

Repayment of notes due from affiliate — — 78 274 — — 352

Taxes paid related to the settlement of equity awards, net of settlement proceeds received — — ( 26,370 ) — — — ( 26,370 )

Stock-based compensation expense — — 42,983 — — — 42,983

Interest accrued relating to notes due from affiliates — — — 40 — — 40

Settlement of convertible notes 341,877 — 5,751 — — — 5,751

Issuance of common stock net of issuance costs of $ 13,293

3,703,704 3 86,704 — — — 86,707

Change in foreign currency translation adjustment — — — — — 35 35

6 unchanged sentences

Stock-based compensation expense — — 56,781 — — — 56,781

Settlement of convertible notes 341,877 — 5,751 — — — 5,751

Issuance of common stock net of issuance costs of $ 13,293

3,703,704 3 86,704 — — — 86,707

Shares issued in connection with an acquisition 22,252 — 1,000 — — — 1,000

Purchase of capped calls related to the June 2025 Convertible Notes, net of tax — — ( 25,664 ) — — — ( 25,664 )

Change in foreign currency translation adjustment — — — — — 4 4

Net loss — — — — ( 4,555 ) — ( 4,555 )

— — — — 150,832 — 150,832

Balance at December 31, 2025 79,359,589 $ 79 $ 686,921 $ — $ ( 138,866 ) $ 48 $ 548,182

6 unchanged sentences

Cash Flows from Operating Activities:

Net loss $ ( 4,555 ) $ ( 28,171 ) $ ( 91,629 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Net income (loss) $ 150,832 $ ( 4,555 ) $ ( 28,171 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 13,329 9,778 9,141

8 unchanged sentences

Gain on settlement of derivative liability — ( 1,924 ) —

(Gain)/loss on revaluation of contingent consideration — — ( 5,279 )

Gain on change in fair value of investment ( 5,389 ) — —

Gain on change in fair value of investments (1)

( 609 ) ( 5,389 ) —

Provision for credit losses 799 300 —

Non-cash revenue from investment ( 1,040 ) ( 1,608 ) ( 1,504 )

Non-cash revenue from investments ( 1,174 ) ( 1,040 ) ( 1,608 )

Inventory write-off — — 916

Adjustment in connection with membership benefit — — ( 2,172 )

Changes in operating assets and liabilities, net of acquisitions:

Deferred income taxes

( 118,354 ) — —

Changes in operating assets and liabilities, net of acquisition:

Accounts receivable, net ( 23,518 ) ( 16,117 ) ( 9,055 )

6 unchanged sentences

Other liabilities, noncurrent ( 359 ) ( 364 ) ( 498 )

Net cash provided by (used in) operating activities 32,612 7,524 ( 57,055 )

Net cash provided by operating activities 88,630 32,612 7,524

Cash Flows from Investing Activities:

Cash paid for acquisitions, net of cash acquired — — ( 110,933 )

Internal use software ( 3,945 ) ( 1,715 ) ( 701 )

Cash paid for acquisition ( 2,825 ) — —

Internally developed software ( 5,716 ) ( 3,945 ) ( 1,715 )

Purchase of property and equipment ( 1,792 ) ( 1,187 ) ( 506 )

Related Party SAFE — ( 5,000 ) —

Convertible note investment

( 25,000 ) — —

Net cash used in investing activities ( 35,333 ) ( 10,132 ) ( 2,221 )

1 unchanged sentence

Indemnity escrow payment in connection with an acquisition — — ( 13,128 )

Proceeds from the exercise of stock options and warrants, and restricted stock settlements 14,553 5,811 2,394

Proceeds related to tax withholdings on restricted stock settlements and the exercise of stock options and warrants 69,520 14,553 5,811

Taxes paid related to net settlement of equity awards ( 62,836 ) ( 33,995 ) ( 14,033 )

4 unchanged sentences

Proceeds from repayment of notes due from affiliates — — 314

Repayment of convertible notes — ( 3,919 ) ( 3,471 )

Life360, Inc.

Proceeds from capital raise, net of transaction costs — — 32,215

Repayment of convertible notes — — ( 3,919 )

Proceeds from issuance of convertible senior notes 320,000 — —

Payments of debt issuance costs ( 10,884 ) — —

Purchase of capped calls ( 33,728 ) — —

Net cash provided by (used in) financing activities 282,072 67,266 ( 24,955 )

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash 89,746 ( 19,652 ) ( 140,980 )

Net Increase in Cash, Cash Equivalents, and Restricted Cash 335,369 89,746 ( 19,652 )

Cash, Cash Equivalents and Restricted Cash at the Beginning of the Period 160,459 70,713 90,365

1 unchanged sentence

Supplemental disclosure:

Cash paid during the period for taxes 2,381 697 —

Cash paid (refunds received) during the period for income taxes, net ( 893 ) 2,381 697

Cash paid during the period for interest — 46 640

Cash payments included in the measurement of operating lease liabilities

Non-cash investing and financing activities:

Fair value of stock issued in connection with an acquisition $ — $ — $ 15,409

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

Fair value of stock issued in connection with the acquisition of Fantix, Inc.

Liability incurred in connection with the acquisition of Fantix, Inc.

Operating lease liability recognized in connection with lease modification — — 1,054

2 unchanged sentences

Property and equipment included within accrued expenses and other current liabilities — 112 —

Stock-based compensation included in internal use software 714 — —

Stock-based compensation included in internally developed software 1,321 714 —

Related Party Warrant — 3,898 —

The following table provides a table of cash, cash and cash equivalents, and restricted cash reported within the balance sheets totaling the same such amounts shown above:

Conversion of Related Party SAFE to Related Party Investment

(1) Includes a related party gain of $ 882 , zero , and zero for the years ended December 31, 2025, 2024, and 2023, respectively.

The following table presents the cash, cash equivalents, and restricted cash reported within the consolidated statements of cash flows shown above:

2025 December 31,

1 unchanged sentence

Cash and cash equivalents $ 494,261 $ 159,238 $ 68,964

Restricted cash, current — — 13,274

Restricted cash, noncurrent 1,567 1,221 1,749

10 unchanged sentences

The Life360 mobile application operates under a “freemium” model where its core offering is available to members at no charge, with additional membership subscription options that are available but not required.

In addition to the Life360 mobile application, the Company also offers hardware tracking devices through the sale of Tile, Inc.

(“Tile”) and Jio, Inc.

(“Jiobit”) products to keep members close to the people, pets and things they care about most.

In addition to the Life360 mobile application, the Company also offers hardware tracking devices through the sale of Tile by Life360, Inc.

(“Tile”) and Life360 Pet GPS products to keep members close to the people, pets, and things they care about most.

The Company’s suite of product and service offerings, including the Life360 and Tile mobile applications, and related third-party services, is system and platform-agnostic, allowing its products and services to work seamlessly for its members, regardless of the devices they use.

The Company also generates revenue through partnerships, including through the placement of ads within our platform, and the sale of aggregated, non-personally identifiable data for data insight purposes.

Management and Board of Directors Transitions

On August 11, 2025, the Company announced that its Board of Directors appointed Lauren Antonoff, then Chief Operating Officer, as the Company’s Chief Executive Officer and a member of the Company’s Board of Directors, and Chris Hulls, the Company’s Co-Founder and then Chief Executive Officer, as Executive Chairman of the Board.

Effective the same date, the Company’s Board of Directors appointed Mark Goines as Lead Independent Director.

Initial Public Offering (“U.S.

10 unchanged sentences

Basis of Presentation and Consolidation

The consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States, or (“GAAP”), are presented in U.S.

The consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the U.S., or (“GAAP”), are presented in U.S.

dollars unless otherwise stated, and include the accounts of the Company and its wholly owned subsidiaries.

All inter-company transactions and balances have been eliminated.

During the current period, the Company revised its presentation of Interest income in the consolidated statements of operations and comprehensive income (loss) to provide more meaningful information to financial statement users.

Previously, Interest income was included within Other income (expense), net.

Comparative prior period amounts have been reclassified to conform to the current period presentation.

The reclassification had no impact on net income (loss).

Life360, Inc.

Notes to Consolidated Financial Statements

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenue and expenses during the reporting period.

Significant estimates made by management include, but are not limited to:

The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, net revenue, and expenses.

Significant items subject to such estimates, judgments, and assumptions include:

• revenue recognition, including the determination of selling prices for distinct performance obligations sold in multiple performance obligation arrangements, the period over which revenue is recognized for certain arrangements, and estimated delivery dates for orders with title transfer upon delivery;

• allowance for credit losses, product returns;

• allowance for credit losses and product returns;

• promotional and marketing allowances;

1 unchanged sentence

• average useful customer life;

• valuation of stock-based awards;

Life360, Inc.

Notes to Consolidated Financial Statements

• valuation of stock-based awards, including market-based restricted stock units (“MRSUs”);

• achievement of performance-based restricted stock units (“PRSUs”);

1 unchanged sentence

• impairment of long-lived assets and goodwill;

• valuation of non-cash consideration, contingent consideration, convertible notes and embedded derivatives;

• valuation of non-cash consideration, contingent consideration, investments, convertible notes, and embedded derivatives;

• useful lives of long-lived assets;

3 unchanged sentences

Recently adopted accounting pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07 – Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

The adoption of this ASU did not change the way the Company evaluates its reportable segments and, as a result, did not have a material impact on the Company’s segment-related disclosures.

Refer to Note 3, "Segment and Geographic Revenue" for additional information.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid.

The updates in this ASU are effective for annual periods beginning after December 15, 2024, and can be applied either retrospectively or prospectively.

The Company adopted the ASU and has opted for retrospective application to our income tax disclosures as presented in Note 14, "Income Taxes".

The adoption of this ASU did not have a material impact on the Company’s financial position or results of operations.

Prior-year income tax disclosures for 2024 and 2023 have been updated to conform to the current period presentation.

Accounting pronouncements not yet adopted

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) Narrow-Scope Improvements .

The ASU clarifies and reorganizes interim reporting guidance, including disclosure requirements related to events occurring since the end of the most recent annual reporting period, and improves the presentation and usability of interim financial statement disclosures.

The ASU is effective for interim reporting periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its interim financial reporting and does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606):

Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract .

The ASU narrows the scope of derivative accounting by excluding certain non-exchange-traded contracts whose terms are based on the normal operations or activities of one of the parties, and clarifies that share-based noncash consideration received from a customer in a revenue contract should be accounted for under ASC 606 until the right to the consideration becomes unconditional.

The ASU is effective for annual periods beginning after December 15, 2026, and interim periods within those annual periods, with early adoption permitted.

The Company does not expect the adoption of this ASU to have a material impact on its financial position or results of operations.

Life360, Inc.

Notes to Consolidated Financial Statements

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software .

The ASU eliminates project stages and requires software cost capitalization to begin after management has authorized and committed to funding the software project and it is probable the project will be completed and used to perform the function intended.

The ASU also requires additional property, plant and equipment disclosures for all capitalized software costs.

The ASU is effective for annual periods beginning after December 15, 2027, and interim periods within those years, with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets .

The ASU introduces a practical expedient for estimating expected credit losses on current accounts receivable and current contract assets arising from revenue transactions from contracts with customers.

The ASU is effective for annual periods beginning after December 15, 2025, and interim periods within those annual periods, with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation (Subtopic 220-40):

3 unchanged sentences

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid.

The updates in this ASU are effective for annual periods beginning after December 15, 2024.

Early adoption is permitted.

The Company does not expect adoption of this ASU will have a material impact on its financial position or results of operations.

Revenue Recognition

10 unchanged sentences

The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer.

Life360, Inc.

Notes to Consolidated Financial Statements

Subscription Revenue

4 unchanged sentences

The Company provides its customers with technical support along with unspecified updates and upgrades to the platform on an if and when available basis.

Life360, Inc.

Notes to Consolidated Financial Statements

The premium subscription plan for hardware tracking devices is a distinct and separate performance obligation from the hardware.

14 unchanged sentences

The Company’s other revenue consists of data and partnership revenue, which includes advertising revenue.

Life360, Inc.

Notes to Consolidated Financial Statements

Data revenue is generated primarily through an arrangement with a key data partner that provides location-based analytics to customers in the retail and real estate sectors, municipalities, and other private and public organizations (“Data Partner”).

In January 2022, Life360 announced a partnership agreement with a key Data Partner, a prominent provider of aggregated analytics for the retail ecosystem, in which executives of the Company have an immaterial ownership interest through a passive investment vehicle.

In January 2022, the Company announced a partnership agreement with a Data Partner, a prominent provider of aggregated analytics for the retail ecosystem, in which executives of the Company have an immaterial ownership interest through a passive investment vehicle.

This agreement was amended and restated in August 2024, and the term was extended for a period of five years .

As part of this partnership, the Data Partner will provide data processing and analytics services to Life360 and will have the right to commercialize aggregated data related to place visits during the agreement term.

As part of this partnership, the Data Partner will provide data processing and analytics services to the Company and will have the right to commercialize aggregated data related to place visits during the agreement term.

The partnership agreement includes fixed and variable monthly revenue amounts, as well as quarterly minimum guarantees, for access to aggregated data for the duration of the five-year agreement.

7 unchanged sentences

Refer to the "Investments" section below for additional information regarding the Company's Data Revenue Partner Warrant.

Life360, Inc.

Notes to Consolidated Financial Statements

Data revenue was $ 32.7 million, $ 26.6 million, and $ 21.6 million for the years ended December 31, 2025, 2024, and 2023, respectively.

2 unchanged sentences

Revenue is recorded on a gross basis if the Company acts as the principal in the transaction, or a net basis if the Company acts as the agent.

Generally, when the Company directly sells advertising on its mobile platform, revenue is recorded on a gross basis.

Variable amounts earned from partnership revenue arrangements are allocated to the month in which the partner’s related revenue is generated or advertising is delivered.

Partnership revenue also includes revenue related to the Company’s partnership with a related party.

In November and December 2024, the Company entered into a strategic partnership and series of transactions with a related party, including a partnership and revenue share agreement (the “Related Party Agreement”).

In 2024, the Company entered into a strategic partnership and series of transactions with a related party, including a partnership and revenue share agreement (the “Related Party Agreement”).

Refer to Note 15, "Related-Party Transactions" for additional information.

3 unchanged sentences

The Related Party Agreement has standard payment terms that require payment within 30 days.

Life360, Inc.

Notes to Consolidated Financial Statements

The grant of the Related Warrant is considered non-cash consideration, which the Company measured at fair value on the date of issuance.

The warrant includes various performance-based vesting conditions based on revenue and operational milestones to be measured and assessed throughout the term of the agreement.

No tranche of the Related Party Warrant has vested as of December 31, 2024.

The grant of the Related Party Warrant was considered non-cash consideration, which the Company measured at fair value on the date of issuance.

The Related Party Warrant includes various performance-based vesting conditions based on revenue and operational milestones to be measured and assessed throughout the term of the agreement.

As of December 31, 2025, 2,049,191 shares of the Related Party Warrant have vested.

The warrant was valued using a Black Scholes option-pricing model, and the fair value of approximately $ 3.9 million has been included as consideration in the transaction price of the Related Party Agreement, and is also included in prepaid expenses and other assets, noncurrent and deferred revenue on the Company’s consolidated balance sheets.

The fair value of the warrant included within deferred revenue is amortized to other revenue over the life of the agreement.

The Company recognized $ 0.9 million, zero , and zero in other revenue on the consolidated statements of operations and comprehensive income (loss) in connection with the Related Party Warrant during the years ended December 31, 2025, 2024, and 2023, respectively.

Partnership revenue was $ 35.7 million, $ 9.4 million, and $ 3.9 million for the years ended December 31, 2025, 2024, and 2023, respectively.

6 unchanged sentences

The factors may vary depending on the facts and circumstances related to each performance obligation.

Life360, Inc.

Notes to Consolidated Financial Statements

Our hardware sales arrangements typically contain multiple performance obligations, consisting of the hardware sale, application usage, hardware support, and in some cases, premium subscriptions.

14 unchanged sentences

Remaining performance obligations represent the amount of contracted future revenue not yet recognized as the amounts relate to undelivered performance obligations, including both deferred revenue and non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods.

Revenue allocated to remaining performance obligations was $ 213.9 million as of December 31, 2024, of which the Company expects 35 % to be recognized over the next twelve months .

Life360, Inc.

Notes to Consolidated Financial Statements

Revenue expected to be recognized in connection with remaining performance obligations was $ 207.1 million as of December 31, 2025, of which the Company expects 43 % to be recognized over the next twelve months .

Cost of Revenue

4 unchanged sentences

Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for operations personnel.

Cost of other revenue consists of cloud-based hosting costs, as well as costs of product operations functions and personnel-related costs associated with the Company’s data and advertising platforms.

Cost of other revenue includes cloud-based hosting costs, as well as costs of product operations functions and personnel-related costs associated with the Company’s data and advertising platforms.

Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for operations personnel.

Life360, Inc.

Notes to Consolidated Financial Statements

Costs Capitalized to Obtain Contracts

Costs capitalized to obtain contracts comprise of commission payments in connection with annual subscription sales of the Company’s mobile application through a third-party store platform.

These costs that are incremental and directly related to new customer sales contracts are accrued and capitalized upon execution of a non-cancelable customer contract, and subsequently expensed over the estimated period of benefit, which is currently estimated to be two to three years .

Costs capitalized to obtain contracts are comprised of commission payments in connection with annual subscription sales of the Company’s mobile application through a third-party store platform.

The Company has elected the practical expedient under ASC 340-40 to expense incremental costs of obtaining a contract if the amortization periods is one year or less.

4 unchanged sentences

As of December 31, 2025 and 2024, the allowance for credit losses was $ 0.1 million and $ 0.4 million, respectively.

For the year ended December 31, 2024 the provision for credit losses expense was $ 0.3 million, and for the years ended December 31, 2023 and 2022, was immaterial .

For the years ended December 31, 2025, 2024, and 2023, respectively, the provision for credit losses expense was $ 0.8 million, $ 0.3 million, and zero .

Included in accounts receivable, net are unbilled receivables, which are amounts that have not yet been invoiced to customers as of the balance sheet date, but are contractually owed to the Company..

As of December 31, 2025 and 2024, unbilled receivables were $ 10.3 million and $ 5.5 million, respectively.

Inventory and Contract Manufacturing

2 unchanged sentences

The Company assesses the valuation of inventory and writes down the value for estimated excess and obsolete inventory based upon estimates of future demand and market conditions.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company outsources a significant portion of its manufacturing to independent contract manufacturers in Asia.

A significant portion of its cost of revenue consists of inventory purchased from these manufacturers.

The Company’s inventory is held at third party warehouses and contract manufacturer premises.

The Company’s manufacturers procure components and manufacture the Company’s products based on the demand forecasts provided.

The Company outsources a significant portion of its manufacturing to an independent contract manufacturer in Asia.

A significant portion of its cost of revenue consists of inventory purchased from this manufacturer.

The Company’s inventory is held at third party warehouses and the contract manufacturer premises.

The Company’s manufacturer procures components and manufactures the Company’s products based on the demand forecasts provided.

These forecasts are based on estimates of future demand for the Company’s products, which are in turn based on historical trends and an analysis from the Company’s sales and marketing organizations, adjusted for overall market conditions.

4 unchanged sentences

Major Customers

The Company’s customers primarily consist of individual consumers, who subscribe to the Company’s product offerings through our Channel Partners, data revenue customers and retail partners, who purchase hardware tracking devices from the Company and resell them directly to individual consumers.

Any changes in customer preferences and trends or changes in terms of use of Channel Partners’ platforms could have an adverse impact on its results of operations and financial condition.

The Company derives its accounts receivable from revenue earned from customers located in the United States and internationally.

The Company’s customers primarily consist of individual consumers, who subscribe to the Company’s product offerings through its third-party platforms (each a “Channel Partner”), data and partnership revenue customers, and retail partners, who purchase hardware tracking devices from the Company and resell them directly to individual consumers.

Any changes in customer preferences and trends or changes in terms of use of Channel Partners’ platforms could have an adverse impact on the Company’s results of operations and financial condition.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company derives its accounts receivable from revenue earned from customers located in the U.S.

and internationally.

Channel and retail partners account for the majority of the Company’s revenue and accounts receivable for all periods presented.

The following tables set forth the information about the Company’s Channel Partners that processed our overall revenue transactions and retail partners who represented greater than 10% of our revenue and accounts receivable, respectively:

The following tables set forth the information about Channel Partners that processed revenue transactions and retail partners who accounted for more than 10% of revenue or accounts receivable, respectively:

Percentage of Revenue

3 unchanged sentences

Channel Partner (Google) 19 % 18 % 16 %

Retail Partner A * * 13 %

* Represents less than 10%

6 unchanged sentences

* Represents less than 10%

Life360, Inc.

Notes to Consolidated Financial Statements

Supplier Concentration

2 unchanged sentences

Research and Development Costs

The Company charges costs related to research and development which primarily consist of personnel-related costs for our engineering, product, and design teams, material costs of building and developing prototypes for new products, mobile app development and allocated overhead.

The Company charges costs related to research and development which consist primarily of personnel-related costs for its engineering, product, and design teams, material costs of building and developing prototypes for new products, mobile app development, and allocated overhead.

Sales and Marketing Costs

Our sales and marketing expenses consist primarily of personnel-related costs, brand marketing costs, lead generation costs, sales incentives, sponsorships and amortization of acquired intangibles.

Commissions to Channel Partners in connection with annual subscription sales of the Company’s mobile application on Channel Partner store platforms are considered to be incremental and recoverable costs of obtaining a contract with a customer and are deferred and typically amortized over an estimated period of benefit of two to three years depending on the subscription type.

The Company’s sales and marketing expenses consist primarily of commissions to Channel Partners, personnel-related costs, brand marketing costs, lead generation costs, sales incentives, sponsorships, amortization of acquired intangibles, bad debt expense, and allocated overhead.

Commission payments to Channel Partners in connection with annual subscription sales of the Company’s mobile application on third-party store platforms are considered to be incremental and recoverable costs of obtaining a contract with a customer and are either expensed as incurred or deferred and amortized over an estimated period of benefit of three years depending on the subscription type.

Advertising Expense

1 unchanged sentence

Advertising expense was $ 36.1 million, $ 23.8 million, and $ 28.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Life360, Inc.

Notes to Consolidated Financial Statements

Cash and Cash Equivalents

3 unchanged sentences

Restricted Cash

The restricted cash, noncurrent balance of $ 1.2 million as of December 31, 2024 primarily relates to the letters of credit issued on behalf of the Company for indebtedness to trade creditors incurred in the ordinary course of business, and deposits for personnel contractors with the Company.

The restricted cash, noncurrent balance of $ 1.7 million as of December 31, 2023 relates to the letters of credit issued on behalf of the Company for indebtedness to trade creditors incurred in the ordinary course of business.

The restricted cash, noncurrent balance of $ 1.6 million and $ 1.2 million as of December 31, 2025 and December 31, 2024, respectively, relates to cash deposits restricted under letters of credit issued on behalf of the Company in support of indebtedness to trade creditors incurred in the ordinary course of business.

Fair Value of Financial Instruments

The Company measures its financial assets at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

The Company measures and reports certain assets and liabilities at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

The Company measures certain non-marketable equity securities and warrant investments at fair value on a nonrecurring basis in accordance with ASC 321, Investment - Equity Securities.

Instruments are remeasured to fair value when observable price changes in orderly transactions for an identical or a similar investment of the same issuer occur.

The three levels of inputs that may be used to measure fair value are as follows:

2 unchanged sentences

Level 3 – Valuations based on unobservable inputs to the valuation methodology and including data about assumptions market participants would use in pricing the asset or liability based on the best information available under the circumstances.

Life360, Inc.

Notes to Consolidated Financial Statements

The recorded carrying amounts of cash and cash equivalents, prepaid expenses, accounts payable, and accounts receivable as of December 31, 2024 and December 31, 2023, approximate fair value due to their short-term nature.

Refer to Note 5, "Fair Value Measurements" for further details.

The recorded carrying amounts of certain financial instruments, including cash and cash equivalents, prepaid expenses, accounts payable, and accounts receivable as of December 31, 2025 and December 31, 2024, approximate fair value due to their short-term maturities.

Refer to Note 5, "Fair Value Measurements" and Note 7, "Balance Sheet Components" for additional information on the assets and liabilities measured at fair value.

Property and Equipment, net

1 unchanged sentence

Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets.

Equipment, computer software, furniture, and product manufacturing equipment, which includes construction-in-process that is capitalized and depreciated when placed into service, have estimated useful lives ranging from three to ten years .

Leasehold improvements are amortized on a straight-line basis over the lesser of the estimated useful life or the term of the lease with expected renewals.

Costs of maintenance and repairs that do not improve or extend the lives of the respective assets are expensed as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the balance sheet and the resulting gain or loss is reported in other income (expense), net in the period realized.

Internal Use Software

For development costs related to internal use software projects, including costs incurred in connection with the development of new features added to the Life360 app, the Company capitalizes costs incurred during the application development stage, which begins after the completion of the preliminary project phase and when it is probable that the project will be completed and used as intended.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the balance sheets and the resulting gain or loss is reported in other income (expense), net in the period realized.

Life360, Inc.

Notes to Consolidated Financial Statements

Internally Developed Software

For development costs related to internally developed software projects, including costs incurred in connection with the development of new features added to the Life360 app, the Company capitalizes costs incurred during the application development stage, which begins after the completion of the preliminary project phase and when it is probable that the project will be completed and used as intended.

Capitalized costs include personnel and related expenses for employees and fees paid to third-party contractors and vendors directly involved in the development effort.

1 unchanged sentence

Costs related to preliminary project activities and post implementation activities are expensed as incurred.

Internal use software is amortized to cost of subscription revenue on a straight-line basis over its estimated useful life, which is generally three years .

Internally developed software is amortized to cost of subscription revenue on a straight-line basis over its estimated useful life, which is generally three years .

The Company capitalized $ 7.0 million, $ 4.7 million, and $ 1.7 million during the years ended December 31, 2025, 2024 and 2023, respectively.

Capitalized costs are included within intangible assets, net on the consolidated balance sheet.

Capitalized costs are included within intangible assets, net on the consolidated balance sheets.

Lease Obligation

Operating lease right-of-use assets and lease liabilities are recognized at the present value of the future lease payments at commencement date.

Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at the present value of the future lease payments at commencement date.

The interest rate implicit in the Company’s operating leases is not readily determinable, and therefore an incremental borrowing rate is estimated to determine the present value of future payments.

The estimated incremental borrowing rate factors in a hypothetical interest rate on a collateralized basis with similar terms, payments, and economic environments.

Operating lease right-of-use (“ROU”) assets also include any prepaid lease payments and lease incentives.

Operating lease ROU assets also include any prepaid lease payments and lease incentives.

ROU assets are assessed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate the carrying value may not be recoverable.

As of December 31, 2024, 2023, 2022, respectively, no impairment expense related to ROU assets have been recognized.

As of December 31, 2025, 2024, 2023, respectively, no impairment expense related to ROU assets has been recognized.

The operating lease agreement contains rent concession, rent escalation, and option to renew provisions.

4 unchanged sentences

In addition, the Company’s operating lease agreement contains tenant improvement allowances from its landlord.

These allowances are accounted for as lease incentives and decrease the Company’s right-of-use asset and reduce single lease cost over the lease term.

These allowances are accounted for as lease incentives and decrease the Company’s ROU asset and reduce single lease cost over the lease term.

Refer to Note 7, "Balance Sheet Components" for additional lease disclosures.

Life360, Inc.

Notes to Consolidated Financial Statements

Restructuring and Other Charges

7 unchanged sentences

The restructuring costs are recognized in the consolidated statements of operations for the years ended December 31, 2024 and 2023 are as follows (in thousands).

The Company did not incur non-recurring personnel and severance related expenses during the year ended December 31, 2025.

Life360, Inc.

Notes to Consolidated Financial Statements

Personnel and Severance Related Expenses

11 unchanged sentences

Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations.

Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired.

Goodwill amounts are not amortized but are tested for impairment at least annually during the fourth quarter, or more frequently if indicators of impairment exist.

The Company tests for goodwill impairment annually as of October 31 of each year.

Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired and reflects benefits from assets not individually identifiable, including anticipated synergies and growth opportunities.

Goodwill amounts are not amortized but are tested for impairment annually as of October 31 of each year, or more frequently if indicators of impairment exist.

There was no impairment of goodwill during the years ended December 31, 2025, 2024 and 2023.

Intangible Assets, net

Intangible assets, including acquired, trade names, customer relationships, acquired developed technology, and internal use software are carried at cost and amortized on a straight-line basis over their estimated useful lives.

Intangible assets, including acquired, trade names, customer relationships, acquired developed technology, and internally developed software are carried at cost and amortized on a straight-line basis over their estimated useful lives.

The Company determines the appropriate useful life of the Company’s intangible assets by measuring the expected cash flows of acquired assets.

There was no impairment of intangible assets recorded during the years ended December 31, 2025, 2024 and 2023.

Life360, Inc.

Notes to Consolidated Financial Statements

Impairment of Long-Lived Assets

4 unchanged sentences

There was no impairment of long-lived assets recognized during the years ended December 31, 2025, 2024 and 2023.

Life360, Inc.

Notes to Consolidated Financial Statements

Deferred Revenue

Deferred revenue consists primarily of payments received and accounts receivable recorded in advance of revenue recognition under the Company’s subscription arrangements.

Deferred revenue consists primarily of payments received and accounts receivable recorded in advance of revenue recognition under the Company’s subscription service arrangements and is recognized as the revenue recognition criteria is met.

The Company primarily invoices its customers for its subscription services arrangements in advance.

4 unchanged sentences

Investments in non-public businesses that do not have readily determinable pricing, and for which the Company does not have control or does not exert significant influence, are carried at cost less impairments, if any, plus or minus changes in observable prices for those investments.

Gains or losses resulting from changes in the carrying value of these investments are included as non-operating expenses on the Company’s consolidated statements of operations and comprehensive loss.

Data Revenue Partner Warrant

The Data Revenue Partner Warrant is a non-marketable equity security consisting of a warrant held to purchase shares of preferred stock of a Data Revenue Partner, refer to “Revenue Recognition ” section above for additional information regarding the Company’s Data Revenue Partner.

In September 2024, an observable price change related to our investment in the warrant held to purchase shares of preferred stock of a data revenue partner took place.

The Data Revenue Partner Warrant is a non-marketable equity security consisting of a warrant held to purchase shares of preferred stock of a Data Revenue Partner.

Refer to the “ Revenue Recognition” section above for additional information.

In September 2024, an observable price change of the Data Revenue Partner Warrant took place.

This resulted in a $ 5.4 million increase in the investment asset value and a corresponding gain on fair value adjustment recorded in other income (expense), net in the consolidated statements of operations and comprehensive income (loss).

There was no gain or loss associated with the Data Revenue Partner Warrant in 2025.

The carrying value of the Company’s investment in the Data Revenue Partner Warrant is included in prepaid expenses and other assets, noncurrent in the consolidated balance sheets.

As of December 31, 2025 and 2024, the balance was $ 10.9 million and $ 10.9 million, respectively.

Related Party Simple Agreement for Future Equity (“SAFE”)

Related Party Simple Agreement for Future Equity (“SAFE”) Conversion to Related Party Investment

In December 2024, the Company entered into a SAFE with a related party and invested $ 5.0 million (the “Related Party SAFE”).

For additional information, refer to Note 15, "Related-Party Transactions" below.

Under the terms of the SAFE, the Company holds the right to receive equity at some later date and upon certain events.

The carrying value of the Related Party SAFE Investment is included in prepaid expenses and other assets, noncurrent in the consolidated balance sheets.

As of December 31, 2024, the balance was $ 5.0 million.

Life360, Inc.

Notes to Consolidated Financial Statements

Under the terms of the SAFE, the Company holds the right to receive equity upon the occurrence of specified future events.

For additional information, refer to Note 15, "Related-Party Transactions".

In April 2025, the Related Party SAFE was converted into shares of preferred stock in the related party (the “Related Party Investment”).

As of December 31, 2024, the Related Party SAFE had a carrying balance of $ 5.0 million, and as of December 31, 2025, the Related Party Investment had a carrying balance of $ 5.9 million.

Both investments are included in prepaid expenses and other assets, noncurrent on the consolidated balance sheets.

Refer to Note 5, "Fair Value Measurements" for additional information on the conversion of the Related Party SAFE to the Related Party Investment.

Related Party Warrant

1 unchanged sentence

Refer to the “Revenue Recognition ” section above and Note 15, "Related-Party Transactions" for further details.

As of December 31, 2024, the carrying value of the Company’s investment in the Related Party Warrant is $ 3.9 million and is included in prepaid expenses and other assets, noncurrent on the consolidated balance sheet.

As of December 31, 2025 and 2024, the carrying value of the Company’s investment in the Related Party Warrant is $ 3.9 million and is included in prepaid expenses and other assets, noncurrent on the consolidated balance sheets.

Life360, Inc.

Notes to Consolidated Financial Statements

Convertible Note Investment

In May 2025, the Company entered into a series of transactions with Aura Consolidated Group, Inc (“Aura”) including (i) a 3-year advertising partnership and revenue sharing agreement intended to expand the Company's other revenue channels and subscription membership offerings, and (ii) a $ 25.0 million convertible note investment by the Company into Aura (“Convertible Note Investment”).

The note bears zero interest and matures on May 12, 2030.

The principal is due at maturity and includes both optional and mandatory conversion features, which may result in conversion into the issuer’s equity upon the occurrence of specific events, including financing events, change in control, or at maturity.

The Company elected to apply the fair value option in accordance with ASC 825, Financial Instruments, to account for the hybrid instrument as a single financial instrument.

As a result, the entire instrument is measured at fair value, with changes in fair value recognized in the consolidated statements of operations and comprehensive income (loss) within other income (expense).

The Convertible Note Investment is included within prepaid expenses and other assets, noncurrent on the consolidated balance sheets.

The Company classifies the Convertible Note Investment as Level 3 due to the absence of relevant observable inputs.

The fair value of the Convertible Note Investment was estimated using a scenario-based, probability-weighted option pricing model.

Significant assumptions include the discount rate as well as the timing and probability weighting of each settlement scenario.

Common Stock Warrants

2 unchanged sentences

Stock-Based Compensation

The Company has an equity incentive plan under which various types of equity-based awards including, but not limited to, incentive stock options, non-qualified stock options, restricted stock units, and restricted stock awards, may be granted to employees, nonemployee directors, and nonemployee consultants.

For all equity awards granted to employees, nonemployees and directors, the Company recognizes compensation expense based on the grant-date estimated fair values.

The Company maintains an equity incentive plan under which various types of equity-based awards are granted.

The Plan allows the Company to grant restricted stock units (“RSUs”), which include time-based, performance-based, and market-based restricted stock units, restricted stock, as well as stock options to employees and consultants of the Company and any of the Company’s parent, subsidiaries, or affiliates, and to the members of the Board of Directors.

The Company accounts for stock-based compensation in accordance with ASC 718, Compensation—Stock Compensation, and recognizes stock-based compensation expense based on the grant-date fair value of the awards.

The fair value of RSUs and restricted stock awards is based on the fair value of the Company’s common stock on the grant date.

For RSUs with market-based vesting conditions, the Company estimates fair value using a Monte Carlo simulation model.

The fair value of stock options is determined using the Black-Scholes option pricing model.

For restricted stock units and restricted stock awards, the fair value is based on the grant date fair value of the award.

The Company recognizes compensation expense for stock option awards, restricted stock units, and restricted stock awards on a straight-line basis over the requisite service period of the award, generally three to four years .

Forfeitures are recorded as they occur.

The Company has stock options and restricted stock units with performance-based vesting conditions outstanding.

For awards that include a performance condition, if the performance condition is determined to be probable of being satisfied, the Company recognizes compensation expense related to such awards using the accelerated attribution method over the required performance period.

If a performance condition is not probable of being met, no compensation cost is recognized.

The Company issued performance-based restricted stock units with performance based vesting conditions during the year ended December 31, 2024.

Stock-based compensation expense is recognized over the requisite service period of the awards, which is generally three to four years .

Awards with time-based vesting conditions, including RSUs, restricted stock, and stock options, are recognized on a straight-line basis.

Awards with performance-based vesting conditions are recognized using an accelerated attribution method when achievement of the performance condition is considered probable and are reassessed each reporting period.

Awards with market-based vesting conditions are recognized over the requisite service period and are not adjusted for actual performance outcomes.

The Company accounts for forfeitures as they occur.

Refer to Note 13, "Equity Incentive Plan" for further details.

6 unchanged sentences

Revenue and expenses are translated at the average exchange rate during the period.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company accounts for income taxes under the asset and liability method.

1 unchanged sentence

These temporary differences result in deferred tax assets and liabilities, which are included in the Company’s balance sheets.

In general, deferred tax assets represent future tax benefits to be received when certain expenses previously recognized in the Company’s statements of operations and comprehensive loss become deductible expenses under applicable income tax laws or when net operating loss or credit carryforwards are utilized.

In general, deferred tax assets represent future tax benefits to be received when certain expenses previously recognized in the Company’s statements of operations and comprehensive income (loss) become deductible expenses under applicable income tax laws or when net operating loss or credit carryforwards are utilized.

Accordingly, realization of the Company’s deferred tax assets is dependent on future taxable income against which these deductions, losses and credits can be utilized.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company must assess the likelihood that the Company’s deferred tax assets will be recovered from future taxable income, and to the extent the Company believes that recovery is not likely, the Company establishes a valuation allowance.

To the extent recovery is not considered likely, any previously established valuation allowance is released in the period such determination is made.

The assessment of whether a valuation allowance is required often requires significant judgment including current and historical operating results, the forecast of future taxable income and on-going prudent and feasible tax planning initiatives.

1 unchanged sentence

The Company did not accrue any interest or penalties related to income tax positions during the years ended December 31, 2025, 2024, and 2023.

Refer to Note 10, "Commitments and Contingencies" for more details.

Net Loss Per Share

The Company computes basic and diluted net loss per share in conformity with ASC 260, “Earnings per Share.” Basic net loss per share is calculated by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period without consideration for potentially dilutive securities as they do not share in losses.

Under the if-converted method, shares related to convertible notes, to the extent dilutive, are assumed to be converted into common stock at the beginning of the period.

For purposes of this calculation, options to purchase common stock, common stock warrants, and unvested restricted stock units are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share as the effect is antidilutive.

Refer to Note 17, "Net Loss Per Share" for further details.

Net Income (Loss) Per Share

The Company computes basic and diluted net income (loss) per share in conformity with ASC 260, Earnings per Share.

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period.

Diluted net income (loss) per share reflects the potential dilution that could occur from securities that may result in the issuance of common stock and is calculated by dividing net income (loss) by the diluted weighted-average number of shares outstanding.

Diluted weighted-average shares outstanding include the effect of potential dilutive securities outstanding during the period, including stock options, restricted stock units, warrants, and other similar equity-based securities, which are calculated using the treasury stock method, as well as convertible debt instruments, which are calculated using the if-converted method.

Potential common shares are excluded from diluted net income (loss) per share when their effect would be antidilutive.

Refer to Note 17, "Net Income (Loss) Per Share" for further details.

Life360, Inc.

Notes to Consolidated Financial Statements

Segment and Geographic Revenue

3 unchanged sentences

There is no expense or asset information that is supplemental to information disclosed within the consolidated financial statements, that is regularly provided to the CODM.

The allocation of resources and assessment of performance of the operating segment is based on consolidated net loss and functional expenses as reported on our consolidated statements of operations and comprehensive loss.

The allocation of resources and assessment of performance of the operating segment is based on consolidated net income (loss) and functional expenses as reported on our consolidated statements of operations and comprehensive income (loss).

Because the Company operates as one operating segment, financial segment information, including expense and asset information, can be found in the consolidated financial statements.

All material long-lived assets are based in the United States.

All material long-lived assets are based in the U.S.

Revenue by geography is generally based on the address of the customer as defined in the contract with the customer.

The following table sets forth revenue by geographic region (in thousands):

The following table sets forth revenue by geographic region for the periods presented (in thousands):

Year Ended December 31,

4 unchanged sentences

Total revenue $ 489,481 $ 371,484 $ 304,518

The Company’s revenues in the United States were $ 318.6 million, or 86 %, of total revenue for the year ended December 31, 2024, $ 258.5 million, or 85 %, of total revenue for the year ended December 31, 2023, and $ 205.2 million, or 90 % of total revenue for the year ended December 31, 2022.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company’s revenues in the U.S.

were $ 415.4 million, or 85 %, of total revenue for the year ended December 31, 2025, $ 318.6 million, or 86 %, of total revenue for the year ended December 31, 2024, and $ 258.5 million, or 85 % of total revenue for the year ended December 31, 2023.

Deferred Revenue

7 unchanged sentences

During the year ended December 31, 2024, the Company recognized $ 33.9 million of revenue that was included in the deferred revenue balance as of December 31, 2023.

Life360, Inc.

Notes to Consolidated Financial Statements

Fair Value Measurements

Recurring Fair Value Measurements

The Company measures and reports certain assets and liabilities at fair value on a recurring basis.

The fair value of these instruments as of December 31, 2024 and December 31, 2023 are classified as follows (in thousands):

The fair value of these assets and liabilities as of December 31, 2025 and December 31, 2024 are classified as follows (in thousands):

As of December 31, 2025

1 unchanged sentence

Money market funds $ 332,808 $ — $ — $ 332,808

Convertible Note Investment

— — 24,726 24,726

Total assets $ 332,808 $ — $ 24,726 $ 357,534

Derivative liability (Note 9) $ — $ — $ — $ —

Convertible notes (Note 8) — — — —

Total liabilities $ — $ — $ — $ —

As of December 31, 2024

2 unchanged sentences

Total assets $ 133,959 $ — $ — $ 133,959

Derivative liability (Note 9) $ — $ — $ 217 $ 217

Convertible notes (Note 8) — — 3,449 3,449

Total liabilities $ — $ — $ 3,666 $ 3,666

Life360, Inc.

Notes to Consolidated Financial Statements

The change in fair value of the Level 3 instruments were as follows (in thousands):

As of December 31, 2025

Convertible Note Investment

Fair value, beginning of the year

Initial investment

Changes in fair value ( 274 )

Settlement of September 2021 Convertible Notes upon conversion (Note 8)

Gain on settlement of September 2021 Convertible Notes (Note 8)

Gain on settlement of derivative liability (Note 9)

Fair value, end of period

As of December 31, 2024

Liability September 2021 Convertible Notes

Fair value, beginning of the year 217 3,449

Vesting of revesting notes — 72

Changes in fair value 1,707 608

Forfeiture of revesting notes

Repayment of convertible notes (Note 8)

Settlement of September 2021 Convertible Notes upon conversion (Note 8)

Gain on settlement of September 2021 Convertible Notes (Note 8)

Gain on settlement of derivative liability (Note 9)

Fair value, end of period $ — $ —

For the year ended December 31, 2025, the Company recorded a loss associated with the change in fair value of the Convertible Note Investment of $ 0.3 million.

The amounts have been recorded in other income (expense), net in the consolidated statement of operations and comprehensive income (loss).

For the year ended December 31, 2024, the Company recorded a loss associated with the change in fair value of the derivative liability of $ 1.7 million and a gain related to the settlement of the derivative liability upon conversion of the July 2021 Convertible Notes of $ 1.9 million.

For the year ended December 31, 2024, the Company recorded a loss associated with the change in fair value of the September 2021 Convertible Notes of $ 0.6 million and a gain related to the settlement of the September 2021 Convertible Notes upon conversion of $ 0.5 million.

Refer to Note 8, "Convertible Notes" for further details.

The amounts have been recorded in other income (expense), net in the consolidated statement of operations and comprehensive loss.

For the year ended December 31, 2023, the Company recorded a loss associated with the change in fair value of the derivative liability and convertible notes of $ 0.1 million and $ 0.7 million, respectively.

The amounts have been recorded in other income (expense), net in the consolidated statement of operations and comprehensive loss.

Business Combinations

On January 5, 2022, the Company completed the acquisition of Tile, Inc., a privately held consumer electronics company.

The company is based in San Mateo, California and was founded in 2012.

Tile is a smart location company whose products include a Bluetooth enabled device and related accessories that work in tandem with the Tile application (the “Application”), to enable its customers to locate lost or misplaced objects.

Tile offers a comprehensive list of products to use with the application, along with optional subscription services to enhance features offered for Tile products.

The addition of Tile is expected to strengthen and extend Life360’s market leadership position by leveraging Tile’s developed technology and customer relationships to accelerate the Company’s own product development and augment the Life360 team with a critical mass of talent.

The aggregate purchase consideration was $ 173.5 million, of which $ 158.1 million was paid in cash and $ 15.4 million paid in equity.

The $ 15.4 million in equity was comprised of 780,593 shares of the Company’s common stock valued on the date of acquisition and 534,465 shares of common stock contingent consideration which was promised upon reaching certain operational goals.

Of the consideration transferred, $ 14.1 million in cash and 84,524 common shares were placed in an indemnity escrow fund to be held for fifteen months after the acquisition date for general representations and warranties.

Life360, Inc.

Notes to Consolidated Financial Statements

A total of $ 35.0 million was excluded from purchase consideration which consists of retention compensation of 1,499,349 shares of retention restricted stock units valued at $ 29.6 million, $ 0.4 million related to 38,730 vested common stock options issued to Tile employees as stock-based compensation on the acquisition date and change in control bonuses of $ 3.0 million which were recognized as compensation expense on the consolidated statements of operations on the acquisition date.

The Company incurred transaction related expenses of $ 1.7 million, which were recorded under general and administrative expenses in the consolidated statements of operations.

The remaining costs excluded from purchase consideration were a result of 1,561 shares granted to key employee and vested based continued employment and 4,784 shares of contingent consideration granted to a key employee and vested based on continued employment.

Of the 1,499,349 shares of retention restricted stock units, 787,446 shares valued at $ 15.6 million contained performance vesting criteria based on the achievement of certain company milestones, and were scheduled to vest over a two year period.

As of March 31, 2022, the vesting criteria had not been met and all 787,446 restricted stock units were forfeited.

The remaining retention restricted stock units of 711,903 shares vest over a two to four year period.

The contingent consideration was based on the Company’s achievement of certain targets for revenue and earnings before interest, taxes, depreciation, and amortization for the three months ended December 31, 2021 and the three months ended March 31, 2022.

The Company ascribed no value to the contingent consideration.

The acquisition was accounted for as a business combination and the total purchase consideration was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date and the excess was recorded to goodwill.

The provisional values assigned to the assets acquired and liabilities assumed were based on estimates of fair value available and were finalized as of January 5, 2023.

During the year ended December 31, 2022, the Company made a measurement period adjustment to the preliminary purchase price allocation which included:

(i) a decrease to goodwill of $ 0.5 million, (ii) an increase to deferred revenue of $ 1.3 million, and (iii) an increase to inventory of $ 0.8 million.

The measurement period adjustment was made to reflect facts and circumstances that existed as of the acquisition date and is reflected in the table below.

The assets acquired and liabilities assumed in connection with the acquisition were recorded at their fair value on the date of acquisition, inclusive of the measurement period adjustments, as follows (in thousands):

Cash $ 32,997

Restricted cash 1,050

Accounts receivable 27,826

Prepaid expenses and other current assets 5,004

Inventory 8,320

Property and equipment 570

Prepaid expenses and other assets, noncurrent 482

Intangible assets 52,700

Goodwill 102,547

Accounts payable ( 23,197 )

Accrued expenses and other current liabilities ( 24,613 )

Deferred revenue ( 10,203 )

Total acquisition consideration $ 173,483

The amounts have been recorded in other income (expense), net in the consolidated statement of operations and comprehensive income (loss).

Life360, Inc.

Notes to Consolidated Financial Statements

The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition:

(in thousands) Estimated Useful

Developed technology $ 18,400 5

Trade name 20,000 10

Customer relationships 14,300 8

Total identified intangible assets $ 52,700

Goodwill represents the future economic benefits arising from other assets that could not be individually identified and separately recognized, such as the acquired assembled workforce of Tile.

In addition, goodwill represents the future benefits as a result of the acquisition that will enhance the Company’s product available to both new and existing customers and increase the Company’s competitive position.

Non-Recurring Fair Value Measurements

In April 2025, a related party completed a qualified equity financing and the Related Party SAFE was converted into the Related Party Investment.

The conversion resulted in an observable price change based on the financing round for identical preferred shares.

As a result, a $ 0.9 million gain on the change in the fair value of the investment was recorded within other income (expense), net on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025.

The Related Party Investment is classified within Level 2 of the fair value hierarchy as the valuation is based on an observable price for identical shares that are not readily determinable.

The Related Party Investment balance as of December 31, 2025 was $ 5.9 million and is included within prepaid expenses and other assets, noncurrent on the consolidated balance sheet.

Business Combinations

On February 27, 2025, the Company entered into an Asset Purchase Agreement with Fantix, Inc., to purchase certain assets of Fantix, Inc.

for total consideration of $ 4.5 million, consisting of $ 3.5 million in cash and $ 1.0 million in common stock.

Of the $ 3.5 million in cash consideration, $ 2.8 million was paid at closing and $ 0.7 million, which is payable one year from the closing date, has been recorded in accrued expenses and other current liabilities on the Company’s consolidated balance sheet.

The transaction has been accounted for as a business combination.

The Company also recorded $ 3.6 million to intangible assets, net and $ 0.9 million to goodwill.

Goodwill represents the excess of the purchase price over the fair value of net assets acquired and reflects benefits from assets not individually identifiable, including anticipated synergies and growth opportunities.

The goodwill is not deductible for tax purposes.

The results of Tile's operations are included in the accompanying consolidated statements of operations and comprehensive loss from the acquisition date.

The Company has not presented the pro forma results of operations for the Fantix, Inc.

acquisition as the impact is not material to the Company’s consolidated results of operations.

Balance Sheet Components

13 unchanged sentences

Notes to Consolidated Financial Statements

There were no inventory write-offs recorded for the year ended December 31, 2024.

There were no inventory write-offs recorded for the years ended December 31, 2025 and 2024.

The Company recorded a raw materials inventory write-off of $ 0.9 million for the year ended December 31, 2023.

The write-off resulted from a decision made to discontinue a product line in the Company’s product roadmap where the raw materials had no alternative use.

There were no inventory write-offs recorded for the year ended December 31, 2022.

The write-off resulted from a discontinuation of a product line in the Company’s product roadmap where the raw materials had no alternative use.

Prepaid Expenses and Other Current Assets

4 unchanged sentences

Total prepaid expenses and other current assets $ 20,050 $ 14,599

Prepaid expenses primarily consist of certain cloud platforms, customer service program costs, prepaid insurance and inventory.

Other receivables primarily consist of income tax benefits, refunds owed to the Company, and other amounts which the Company is expected to receive in less than twelve months.

Prepaid expenses primarily consist of advance payments for certain cloud platform costs, advertising, information technology solutions, insurance, and inventory.

Other receivables primarily consist of refunds owed to the Company and other amounts which the Company is expected to receive in less than twelve months.

Property and Equipment, net

15 unchanged sentences

Prepaid expenses, noncurrent $ 3,110 $ 1,849

Investments 19,762 5,474

Convertible Note Investment

Data Revenue Partner Warrant

10,864 10,864

Related Party Investment

Related Party Warrant

Related Party SAFE

Total prepaid expenses and other assets, noncurrent

Prepaid expenses, noncurrent primarily consist of cloud platform costs.

Investments relate to the Data Revenue Partner Warrant, the Related Party Warrant, and the Related Party SAFE.

Refer to Note 2, "Summary of Significant Accounting Policies" for additional information.

$ 48,480 $ 21,611

Life360, Inc.

Notes to Consolidated Financial Statements

Prepaid expenses, noncurrent primarily consist of cloud platform costs.

As of December 31, 2025, other assets consists of investments, including the Convertible Note Investment, Data Revenue Partner Warrant, Related Party Investment, and Related Party Warrant.

As of December 31, 2024, investments relate to the Data Revenue Partner Warrant, the Related Party Warrant, and the Related Party SAFE.

Refer to Note 2, "Summary of Significant Accounting Policies" for additional information.

The Company leases office space under a non-cancelable operating lease with a remaining lease term of up to 0.9 years, which includes the option to extend the lease.

8 unchanged sentences

Supplemental balance sheet information related to leases is as follows (in thousands, except lease term):

As of December 31, As of December 31,

As of December 31,

Operating lease right-of-use asset $ 335 $ 683

2 unchanged sentences

Weighted-average remaining term for operating lease (in years) 0.9 1.9

The weighted-average discount rate used to measure the present value of the operating lease liabilities was 5.0 %.

The weighted-average discount rate used to measure the present value of the operating lease liabilities was 5.0 % for each period presented.

Maturities of the Company’s operating lease liabilities as of December 31, 2025, were as follows (in thousands):

5 unchanged sentences

Notes to Consolidated Financial Statements

Intangible Assets, net

Goodwill and Intangible Assets, net

Intangible assets, net consists of the following (in thousands):

4 unchanged sentences

Customer relationships 15,290 ( 7,595 ) 7,695

Internal use software 7,076 ( 1,157 ) 5,919

Internally developed software 14,113 ( 4,565 ) 9,548

Total $ 78,768 $ ( 40,491 ) $ 38,277

4 unchanged sentences

Customer relationships 15,290 ( 5,668 ) 9,622

Internal use software 2,416 ( 340 ) 2,076

Internally developed software 7,076 ( 1,157 ) 5,919

Total $ 68,176 $ ( 27,602 ) $ 40,574

For the years ended December 31, 2024 and 2023 the Company capitalized $ 4.7 million and $ 1.7 million, respectively, in internal use software.

For the years ended December 31, 2025 and 2024, the Company capitalized $ 7.0 million and $ 4.7 million, respectively, in internally developed software.

For the years ended December 31, 2025, 2024, and 2023, amortization expense was $ 12.9 million, $ 9.5 million, and $ 9.0 million, respectively.

As of December 31, 2024, estimated remaining amortization expense for intangible assets by fiscal year is as follows (in thousands):

As of December 31, 2025, the estimated remaining amortization expense for intangible assets by fiscal year is as follows (in thousands):

2026 $ 13,013

1 unchanged sentence

Total future amortization expense

Internal use software not yet in service 937

Internally developed software not yet in service 2,822

Total future amortization expense $ 38,277

5 unchanged sentences

Customer relationships 3.9 years 5.1 years

Internal use software 2.6 years 3.6 years

Internally developed software 2.3 years 2.6 years

Life360, Inc.

Notes to Consolidated Financial Statements

As of December 31, 2024, the Company had $ 0.9 million of capitalized internal use software projects that were not yet in service.

These projects have been excluded from the weighted-average remaining useful life calculation for internal use software in the table above.

As of December 31, 2025 and December 31, 2024, the Company had $ 2.8 million and $ 0.9 million of capitalized internally developed software projects that were not yet in service, respectively.

These projects have been excluded from the weighted-average remaining useful life calculation for internally developed software in the table above.

As of December 31, 2025 and December 31, 2024, goodwill was $ 134.6 million and $ 133.7 million, respectively.

Goodwill increased $ 0.9 million in connection with the Fantix, Inc.

Refer to Note 6, "Business Combinations" for additional information.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other liabilities consist of the following (in thousands):

Accrued expenses and other current liabilities consist of the following (in thousands):

As of December 31,

Accrued vendor expenses $ 14,891 $ 13,856

Accrued compensation 3,834 3,349

Customer related promotions and discounts 14,013 9,761

Accrued compensation 7,121 3,834

Sales return reserves 2,072 2,817

1 unchanged sentence

Total accrued expenses and other current liabilities $ 42,002 $ 32,015

As of December 31, 2024, other current liabilities primarily relate to the Company’s operating lease liability and sales tax payable.

As of December 31, 2023, other current liabilities primarily relate to the operating lease liability, warranty liabilities related to the Company’s hardware tracking devices, and inventory received not yet billed.

As of December 31, 2025, other current liabilities primarily relate to the Company’s deferred purchase price liability related to the Fantix, Inc.

acquisition, inventory received but not yet billed, and sales taxes payable.

As of December 31, 2024, other current liabilities primarily relate to the operating lease liability and sales tax payable.

Convertible Notes

June 2025 Convertible Notes

In June 2025, the Company issued $ 320.0 million aggregate principal amount of 0.00 % convertible senior notes due June 1, 2030.

The June 2025 Convertible Notes are senior unsecured obligations and do not bear regular interest.

Each $1,000 principal amount of the notes is initially convertible into 12.3501 shares of the Company’s common stock, which represents a conversion price of approximately $ 80.97 per share, subject to adjustment upon the occurrence of specified events.

In certain circumstances, including conversions in connection with a make-whole fundamental change, the conversion rate may be increased, resulting in a conversion price as low as $ 61.11 .

However, the maximum number of shares issuable per $1,000 principal amount is capped at 16.3639, which is subject to the same adjustment provisions as the initial conversion rate.

The June 2025 Convertible Notes are convertible at the option of the holders prior to the close of business on the business day immediately preceding March 1, 2030, only under the following circumstances:

(1) during any fiscal quarter (and only during such quarter) beginning after September 30, 2025, if the closing price of the Company’s common stock for at least 20 trading days in any 30 consecutive trading day period ending on the last trading day of the prior fiscal quarter is greater than or equal to 130 % of the then-applicable conversion price;

(2) during the five business days immediately following any 10 consecutive trading day period in which the trading price per $1,000 principal amount of notes was less than 98 % of the product of the closing price of the Company’s common stock and the conversion rate on each applicable trading day, following a request for such determination by a holder;

(3) if the Company calls the notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date;

or (4) upon the occurrence of specified corporate events, such as certain mergers, reorganizations, or other changes of control.

The June 2025 Convertible Notes are convertible at the option of the holders on or after March 1, 2030, at any time prior to the close of business on the second scheduled trading day prior to the maturity date.

Upon conversion, the Company will settle the principal portion of any June 2025 Convertible Notes in cash.

Any amounts due on conversion over the principal portion may be settled, at the Company’s election, in cash, shares of common stock, or a combination thereof.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company may not redeem the June 2025 Convertible Notes prior to June 5, 2028.

On or after that date, the Company may redeem all or a portion of the notes for cash if the closing price of the Company’s common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during a 30 consecutive trading day period ending on the trading day immediately preceding the date on which the Company provides notice of redemption.

The redemption price will equal the principal amount of the notes to be redeemed, plus any accrued and unpaid interest up to, but excluding, the redemption date.

Upon the occurrence of a fundamental change, which includes certain change-of-control transactions, a delisting of the Company’s common stock, or a liquidation event, holders may require the Company to repurchase up to 100 % of their notes, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date for cash.

The Company accounts for the June 2025 Convertible Notes entirely as a liability in accordance with ASC 470-20, Debt with Conversion and Other Options, as amended by ASU 2020-06.

The embedded conversion feature is not separately accounted for as it does not require bifurcation under ASC 815, Derivatives and Hedging , as it is considered clearly and closely related to the host debt contract and does not meet the criteria for derivative accounting.

The notes were issued at par and are recorded net of debt issuance costs.

As of December 31, 2025, the June 2025 Convertible Notes are classified as noncurrent as the conditions allowing holders of the notes to convert have not been met and the notes are not redeemable until June 5, 2028.

The balance has been recorded within convertible notes, net, noncurrent on the Company’s consolidated balance sheet.

The net carrying amount of the June 2025 Convertible Notes consists of the following (in thousands):

As of December 31,

Unamortized debt issuance costs ( 9,614 )

Net carrying amount

The debt issuance costs are amortized to interest expense over the term of the June 2025 Convertible Notes using the effective interest rate method.

The effective interest rate used to amortize the debt issuance costs is 0.68 %.

Interest expense recognized related to the June 2025 Convertible Notes was $ 1.3 million for the year ended December 31, 2025.

Interest expense is included within other income (expense), net on the consolidated statements of operations and comprehensive income (loss).

The estimated fair value of the June 2025 Convertible Notes, which we classify as Level 2 financial instruments, was determined using observable market prices.

As of December 31, 2025, the estimated fair value of the June 2025 Convertible Notes was $ 343.2 million.

June 2025 Capped Calls

In connection with the pricing of the June 2025 Convertible Notes, the Company entered into privately-negotiated capped call transactions with certain dealer counterparties (the “June 2025 Capped Calls”).

The June 2025 Capped Calls have an initial strike price of approximately $ 80.97 per share, which corresponds to the initial conversion price of the June 2025 Convertible Notes and is subject to certain adjustments.

The June 2025 Capped Calls have a cap price of $ 122.22 per share, which is also subject to certain adjustments.

The $ 33.7 million cost incurred in connection with the June 2025 Capped Calls was recorded as a reduction to Additional paid-in capital on the Company’s consolidated balance sheet.

This was partially offset by an $ 8.0 million increase to Additional paid-in capital related to the release of the associated valuation allowance as of December 31, 2025.

Conditions triggering adjustments to the initial strike price and the initial cap price of these capped calls are similar to those causing adjustments for the June 2025 Convertible Notes.

Life360, Inc.

Notes to Consolidated Financial Statements

The June 2025 Capped Calls are intended to reduce or offset potential dilution to our common stock upon any conversion of the June 2025 Convertible Notes, with this reduction or offset subject to the specified cap price.

The June 2025 Capped Calls are separate transactions, and are not part of the terms of the June 2025 Convertible Notes.

These transactions are classified as equity in accordance with ASC 815, Derivatives and Hedging, as they are (i) indexed to the Company’s own stock, (ii) settled in shares or permitted net-share settlement, and (iii) do not require net cash settlement.

As such, the June 2025 Capped Calls have been recorded within stockholders’ equity and are not accounted for as derivatives.

July 2021 Convertible Notes

3 unchanged sentences

As a result of the conversion, 184,192 shares of common stock were issued to the holders in redemption of the outstanding July 2021 Convertible Notes.

In June 2024, the fair value of the issued common stock was recorded within additional paid-in capital on the Company’s consolidated balance sheet and a $ 0.9 million loss on the settlement of the July 2021 Convertible Notes was recorded in other income (expense), net on the consolidated statements of operations and comprehensive loss.

As of December 31, 2024, the balance of the July 2021 Convertible Notes is zero on the Company’s consolidated balance sheet.

The Company recognized a total of $ 0.1 million, $ 0.4 million, and $ 0.4 million in non-cash interest expense related to the July 2021 Convertible Notes for the years ended December 31, 2024, 2023, and 2022, respectively.

As of December 31, 2025 and 2024, the balance of the July 2021 Convertible Notes is zero on the Company’s consolidated balance sheets.

The Company recognized a total of zero , $ 0.1 million, and $ 0.4 million in non-cash interest expense related to the July 2021 Convertible Notes for the years ended December 31, 2025, 2024, and 2023, respectively.

September 2021 Convertible Notes

In September 2021, the Company, in connection with the acquisition of Jiobit, issued $ 11.6 million representing the fair value of convertible notes (the “September 2021 Convertible Notes”) and $ 1.6 million of revesting convertible notes that vested over time.

In September 2021, the Company issued $ 11.6 million representing the fair value of convertible notes (the “September 2021 Convertible Notes”) and $ 1.6 million of revesting convertible notes that vested over time.

In April 2024, the holders of the September 2021 Convertible Notes elected to convert their notes and accrued interest to common stock based on a fixed conversion price of $ 22.50 per share.

1 unchanged sentence

As a result of the conversion, 157,685 shares of common stock with a fair value of $ 3.5 million were issued to the holders in redemption of the outstanding September 2021 Convertible Notes.

In April 2024, the fair value of the issued common stock was recorded within additional paid-in capital on the Company’s consolidated balance sheet and a $ 0.5 million gain on settlement of the September 2021 Convertible Notes was recorded in other income (expense), net on the consolidated statements of operations and comprehensive loss.

As of December 31, 2024, the balance of the September 2021 Convertible Notes is zero on the Company’s consolidated balance sheet.

Life360, Inc.

Notes to Consolidated Financial Statements

Convertible notes, current and noncurrent consist of the following (in thousands):

As of December 31,

Convertible notes, current:

September 2021 Convertible Notes $ — $ 3,449

Convertible notes, noncurrent:

July 2021 Convertible Notes — 1,056

Total convertible notes $ — $ 4,505

As of December 31, 2025 and 2024, the balance of the September 2021 Convertible Notes is zero on the Company’s consolidated balance sheets.

Derivative Liability

The Company’s derivative liability, which represented embedded share-settled redemption features bifurcated from its July 2021 Convertible Notes, was settled in June 2024 upon the conversion of the July 2021 Convertible Notes to common stock based on a fixed conversion price of $ 11.96 per share.

A $ 1.9 million gain was recorded at the time of conversion within other income (expense), net on the consolidated statements of operations and comprehensive loss for the year ended December 31, 2024.

As of December 31, 2024, the fair value of the derivative liability was zero on the Company’s consolidated balance sheet.

As of December 31, 2023, the fair value of the derivative liability was $ 0.2 million.

Refer to Note 5, "Fair Value Measurements" and Note 8, "Convertible Notes" for further details.

A $ 1.9 million gain was recorded at the time of conversion within other income (expense), net on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2024.

As of December 31, 2025 and 2024, the fair value of the derivative liability was zero on the Company’s consolidated balance sheets.

Commitments and Contingencies

2 unchanged sentences

As of December 31, 2025, future non-cancellable commitments under these arrangements were as follows (in thousands):

Life360, Inc.

Notes to Consolidated Financial Statements

2026 $ 39,062

Total purchase commitments $ 65,062

8 unchanged sentences

The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future but have not yet been made.

The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual.

No amounts associated with such indemnifications have been recorded to date.

Occasionally, the Company is involved in various legal proceedings, claims and government investigations in the ordinary course of business.

The outcome of litigation and other legal matters is inherently uncertain, though the Company intends to vigorously defend the matters.

To date, the Company has not incurred significant costs and has not accrued any material liabilities in the accompanying consolidated financial statements as a result of its indemnification obligations.

Litigation and Arbitration

Occasionally, the Company is involved in various legal proceedings, formal and informal dispute resolution processes, which may include arbitration or litigation, claims, and government investigations in the ordinary course of business.

The outcome of litigation and other legal matters is inherently uncertain, though the Company intends to vigorously defend against any such matters.

In making a determination regarding accruals, using available information, the Company evaluates the likelihood of an unfavorable outcome in legal or regulatory proceedings to which the Company is a party and records a loss contingency when it is probable a liability has been incurred and the amount of the loss can be reasonably estimated.

1 unchanged sentence

Actual outcomes of these legal and regulatory proceedings may materially differ from the Company’s estimates.

On March 12, 2019, a former alleged competitor of Tile, Cellwitch, Inc, filed a patent infringement claim against Tile in the U.S.

District Court, Northern District of California, seeking permanent injunction and damages.

On December 18, 2019, Tile filed an inter partes review petition with the Patent Trial and Appeal Board (“PTAB”) challenging the validity of the patent.

On May 13, 2021, the PTAB issued a Final Written Decision on Tile’s inter partes review petition (the “Final Written Decision”), finding a majority of the claims invalid.

The Final Written Decision was affirmed by the U.S.

Court of Appeals for the Federal Circuit on May 13, 2022.

The case is currently in trial court, with trial scheduled to begin on July 14, 2025.

At this time, a loss is reasonably possible but not estimable, and as a result no legal accrual has been recorded on our consolidated balance sheets as of December 31, 2024.

On August 14, 2023, plaintiffs Stephanie Ireland-Gordy and Shannon Ireland-Gordy filed a putative class action lawsuit against Tile, Life360, and Amazon.com, Inc.

As previously disclosed, in March 2019, Cellwitch, Inc.

filed a patent infringement action against Tile in the U.S.

District Court for the Northern District of California.

Following inter partes review proceedings in which the Patent Trial and Appeal Board invalidated a majority of the asserted claims, and subsequent affirmance by the U.S.

Court of Appeals for the Federal Circuit, the district court proceedings continued.

As previously reported in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, in April 2024, the district court invalidated all but two asserted claims.

On May 16, 2025, the district court granted Tile’s motion for summary judgment of non-infringement, and on June 12, 2025, Cellwitch statutorily disclaimed the asserted patent.

In light of these developments, no loss was considered probable and no litigation reserve was recorded.

On August 5, 2025, the parties settled the remaining claims at no cost.

Life360, Inc.

Notes to Consolidated Financial Statements

On August 14, 2023, plaintiffs Stephanie Ireland-Gordy and Shannon Ireland-Gordy filed a putative class action lawsuit against Tile, Life360, and Amazon.com, Inc.

District Court for the Northern District of California (the “Court”), seeking damages as well as injunctive and declaratory relief.

An amended complaint was filed on April 26, 2024, adding named plaintiffs Melissa Broad and Jane Doe.

Plaintiffs allege that Tile trackers were used by third parties to monitor their movements without their consent, and assert product liability and other claims.

At this time, a loss is not probable nor estimable, and as a result, no legal accrual has been recorded on our consolidated balance sheets as of December 31, 2024.

No litigation reserve was recorded on our consolidated balance sheets as of December 31, 2024 or December 31, 2023.

In June 2024, in connection with its U.S.

IPO, the Company issued a total of 3,703,704 shares of common stock.

The Company has reserved shares of common stock, on an as if converted basis, for issuance as follows:

On February 14, 2025, the Company filed a Motion to Dismiss.

As of August 6, 2025, the Court granted the Company’s Motion to Dismiss the claims of the Ireland-Gordy plaintiffs with prejudice and the remaining plaintiffs' claims are stayed pending an appeal of the Court's ruling on the Company's Motion to Compel Arbitration, which was granted-in-part and denied-in-part.

The hearing on the appeal occurred on January 5, 2026.

At this time, a loss is not probable nor estimable, and as a result, no legal accrual has been recorded on the Company’s consolidated balance sheet as of December 31, 2025.

The Company receives claims and other threats of litigation from customers in the ordinary course of business.

These claims are arbitrable and the Company accrues various costs for these claims including arbitration fees, legal fees and costs.

At this time, a loss is not probable nor estimable from any such claims, and as a result, no legal accruals have been recorded on the Company’s consolidated balance sheet as of December 31, 2025.

No litigation reserve was recorded on the Company’s consolidated balance sheets as of December 31, 2025 or December 31, 2024.

The Company has the following potentially outstanding common stock reserved for issuance:

As of December 31,

2 unchanged sentences

Issuances upon vesting of restricted stock units 4,294,367 5,091,601

Issuances upon conversion of convertible notes — 325,981

Shares reserved for shares available to be granted but not granted yet 15,118,992 12,815,029

23,521,388 23,588,338

Life360, Inc.

Notes to Consolidated Financial Statements

As of December 31, 2024 , the Company had 7,761 outstanding warrants, entitling the holder thereof to purchase shares of the Company’s common stock with an exercise price of $ 6.44 and expiry date in 2025.

As of December 31, 2023, the Company had 137,658 outstanding warrants, entitling the holder thereof to purchase shares of Company common stock with exercise prices ranging from $ 2.28 to $ 11.96 and expiry dates ranging from 2024 to 2026.

As of December 31, 2024, the Company had 7,761 outstanding warrants, entitling the holder thereof to purchase shares of the Company’s common stock with an exercise price of $ 6.44 .

In September 2025, all 7,761 outstanding warrants were exercised on a cashless basis at an exercise price of $ 6.44 per share, resulting in the issuance of 7,205 shares of common stock.

As of December 31, 2025, no warrants remained outstanding.

Equity Incentive Plan

1 unchanged sentence

The Company’s 2011 Stock Plan was originally adopted by the Company’s Board of Directors on July 27, 2011 and the Company’s stockholders on October 11, 2011, and most recently amended and restated, and adopted by the Board of Directors on March 10, 2020 and the Company’s stockholders on July 21, 2020 (as restated, the “Plan”).

The Plan allows the Company to grant restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”), restricted stock and stock options to employees and consultants of the Company and any of the Company’s parent, subsidiaries, or affiliates, and to the members of the Board of Directors.

Options granted under the Plan may be either incentive stock options or nonqualified stock options.

1 unchanged sentence

Nonqualified stock options (“NSOs”) may be granted to any person eligible for grants under the Plan.

The Board of Directors or the Compensation Committee of the Board of Directors determines the period over which options vest and become exercisable.

Options issued under the Plan generally are exercisable for periods not to exceed ten years and generally vest over a 4 -year period with 25 % vesting after one year and the remainder vesting monthly thereafter in equal installments.

The Board of Directors or the Compensation Committee of the Board of Directors also determines the term of options, provided the maximum term for ISOs granted to a 10% stockholder must be no longer than 5 years from date of grant and the maximum term for all other options must be no longer than 10 years from date of grant.

If an option holder’s service terminates, options generally terminate 3 months from the date of termination except under certain circumstances such as death or disability.

As of December 31, 2025, the Company had 23,521,388 shares reserved for issuance and 15,118,992 shares available for issuance under the Plan.

Life360, Inc.

Notes to Consolidated Financial Statements

Time-Based Restricted Stock Units

Time-based restricted stock units (“TRSUs”) generally vest based on continued service over a specified period, which is typically four years .

Each TRSU represents the right to receive one share of common stock upon vesting.

The fair value of TRSUs is determined based on the closing price of the Company’s common stock on the date of grant.

Stock-based compensation expense for these awards is recognized on a straight-line basis over the requisite service period and is offset by actual forfeitures as they occur.

Performance-Based Restricted Stock Units

PRSUs are granted primarily to executive officers and, in limited cases, to certain other senior-level employees.

Vesting is based on continued service and the attainment of certain financial performance metrics, including revenue and Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization targets, over a one-year performance period, as established and approved by the Board of Directors.

The number of shares issued upon vesting may be greater or lesser than the target award amount depending on actual performance, and shares attained over target will be recognized as awards granted in the period earned.

During the years ended December 31, 2025 and 2024, 225,386 and 115,403 PRSUs (“the Target Grant”) were granted with a weighted average grant-date fair value per share of $ 36.61 and $ 27.40 , respectively.

No PRSUs were granted during the year ended December 31, 2023.

The fair value of PRSUs is determined based on the closing price of the Company’s common stock on the date of grant.

Stock-based compensation expense is recognized on a graded-vesting basis for multi-tranche awards and on a straight-line basis for single-tranche awards, based on the estimated probability of achieving the performance conditions, which is reassessed each period.

If achievement of the performance conditions is not considered probable, all previously recognized stock-based compensation expense related to the unvested awards is reversed.

As of December 31, 2025, the performance goals for the PRSU awards granted in 2025 have been achieved.

Accordingly, stock-based compensation cost related to these awards is no longer subject to reversal, and vesting is contingent solely upon the continued service conditions.

In accordance with the vesting schedule of the awards, no shares related to these awards have vested as of December 31, 2025.

Market-Based Restricted Stock Units

Certain executive officers were granted MRSUs during the year ended December 31, 2025.

No MRSUs were granted during the year ended December 31, 2024 or 2023.

Vesting is based on continued service and the Company’s total shareholder return during one-year , two-year , and three-year performance periods as measured relative to the group of companies comprising the S&P Software and Services Index.

The number of shares issued upon vesting may vary from the target award amount depending on actual performance, and shares attained over the target will be recognized as awards granted in the period earned.

During the year ended December 31, 2025, 59,622 MRSUs were granted with a total weighted average grant-date fair value per share of $ 114.73 .

Stock-based compensation expense is recognized on a graded-vesting basis over the requisite service period and is not adjusted for actual performance outcomes.

The Company estimated the fair value of the MRSUs granted using a Monte Carlo simulation model with the following assumptions:

Expected volatility 55.6 % 55.6 % 55.6 %

Risk-free interest rate based on U.S.

Treasury yields

3.8 % 3.6 % 3.6 %

Expected term (years)

Weighted average grant-date fair value per share $ 99.14 $ 121.80 $ 122.99

Life360, Inc.

Notes to Consolidated Financial Statements

RSUs, including TRSUs, PRSUs, and MRSUs

RSU activity for the periods presented is as follows:

Number of Shares Weighted

average grant

date fair value

Balance as of December 31, 2024 5,091,601 $ 19.22

2,167,685 49.79

RSUs vested and settled

( 2,452,615 ) 19.78

RSUs cancelled/forfeited

( 512,304 ) 19.79

Balance as of December 31, 2025 4,294,367 $ 34.05

As of December 31, 2025, there was total unrecognized stock-based compensation expense for outstanding RSUs of $ 127.7 million to be recognized over a period of approximately 2.8 years.

This amount is comprised of unrecognized compensation expense of $ 116.2 million related to outstanding TRSUs, $ 5.7 million related to outstanding PRSUs, and $ 5.8 million related to outstanding MRSUs.

The number of RSUs vested and settled includes shares of common stock that the Company withheld on behalf of employees to satisfy the tax withholding requirements.

RSUs granted during the years ended December 31, 2025, 2024, and 2023 had a weighted average grant date fair value of $ 49.79 , $ 27.36 , and $ 13.15 per share, respectively.

The total fair value of shares vested during the years ended December 31, 2025, 2024, and 2023 was $ 160.8 million, $ 101.0 million, and $ 39.2 million, respectively.

Stock Options

The Company granted no stock options during the years ended December 31, 2025, 2024, and 2023.

Outstanding options at December 31, 2025 relate to historical grants under the Plan.

The following summary of stock option activity for the periods presented is as follows (in thousands, except share and per share data):

13 unchanged sentences

As of December 31, 2025, there was total unrecognized compensation cost for outstanding stock options of $ 0.1 million to be recognized over a period of approximately 0.3 years.

As of December 31, 2024, the Company had 23,588,338 shares reserved for issuance and 12,815,029 shares available for issuance under the Plan.

There were no stock options granted during the years ended December 31, 2024 and 2023.

Stock options granted during the year ended December 31, 2022 had a weighted average grant date fair value of $ 8.33 .

Life360, Inc.

Notes to Consolidated Financial Statements

The intrinsic values of outstanding, vested, and exercisable options were determined by multiplying the number of shares by the difference in exercise price of the options and the fair value of the common stock as of December 31, 2025, 2024, and 2023 of $ 64.14 , $ 41.27 , and $ 15.46 per share, respectively.

1 unchanged sentence

The total intrinsic value of the options exercised during the years ended December 31, 2025, 2024, and 2023 was $ 88.8 million, $ 18.2 million, and $ 7.7 million, respectively.

Performance-based Restricted Stock Units

The Company granted 115,403 PRSUs (“the Target Grant”) to certain executive officers during the year ended December 31, 2024.

No PRSUs were granted to executive officers during the year ended December 31, 2023 or 2022.

The number of PRSUs that may vest depends on the extent to which the performance goals for the award are achieved over a one-year performance period, as determined by the Compensation Committee of the Board, up to a maximum of 200 % of the Target Grant.

The performance goals for the PRSUs consist of the following two metrics, each with a weighting of 50 %:

(1) a revenue metric for the year ended December 31, 2024;

and (2) an Adjusted EBITDA metric for the year ended December 31, 2024.

Each of the metrics are within the Company’s published revenue and Adjusted EBITDA guidance described in the Company’s press release furnished within Exhibit 99.1 of the Company’s Current Report on Form 8-K filed with the SEC on February 29, 2024.

The PRSU awards vest over a four-year period with 1/4th of the shares vesting after the first year and 1/16th of the shares vesting each quarter thereafter, subject to continuous service with the Company.

The Company uses the grant date fair value of the common stock to measure compensation expense for PRSU awards.

Compensation expense is recognized over the vesting period of the PRSU award using the graded-vesting attribution method and shares attained over target upon vesting will be recognized as awards granted in the period.

As of December 31, 2024, the performance goals for the PRSU awards have been achieved at 135 % and only the service conditions remain.

No PRSU shares have vested as of December 31, 2024, in accordance with the vesting schedule of the awards.

RSU, including PRSU, activity for the periods presented is as follows:

Number of Shares Weighted

average grant

date fair value

Balance as of December 31, 2023 6,182,543 $ 12.67

RSUs & PRSUs granted 2,572,091 27.36

RSUs vested and settled ( 3,195,162 ) 31.61

RSUs cancelled/forfeited ( 467,871 ) 14.37

Balance as of December 31, 2024 5,091,601 $ 19.22

As of December 31, 2024, there was unrecognized compensation cost for outstanding restricted stock awards, including PRSUs, of $ 86.6 million to be recognized over a period of approximately 2.8 years.

The number of RSUs vested and settled includes shares of common stock that the Company withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements.

RSUs and PRSUs granted during the years ended December 31, 2024, 2023, and 2022 had a weighted average grant date fair value of $ 27.36 , $ 13.15 , and $ 12.13 per share, respectively.

The total fair value of shares vested during the years ended December 31, 2024, 2023, and 2022 was $ 101.0 million, $ 39.2 million, and $ 12.0 million, respectively.

Stock Options Granted to Employees

The fair value of the employee stock options granted is estimated using the Black-Scholes option-pricing model, based on the following assumptions:

Life360, Inc.

Notes to Consolidated Financial Statements

Year Ended December 31,

2024 2023 2022

Expected terms (in years) N/A N/A 3.87

Expected volatility N/A N/A 65 %

Risk-free interest rate N/A N/A 2.22 %

Expected dividend rate N/A N/A 0 %

Fair Value of Common Stock :

Since the listing of our CDIs on the ASX, the fair value of common stock is based on the closing price of our CDIs on the ASX as reported in Australian dollars, adjusted to reflect the CDI/per share of common stock ratio in effect, and translated to U.S.

dollars based on the date of grant of our common stock.

Expected Term :

The expected term for employees is based on the simplified method, as the Company’s stock options have the following characteristics:

(i) granted at-the-money;

(ii) exercisability is conditional upon service through the vesting date;

(iii) termination of service prior to vesting results in forfeiture;

(iv) limited exercise period following termination of service;

and (v) options are non-transferable and non-hedgeable, or “plain vanilla” options, and the Company has limited history of exercise data.

The expected term for non-employees is based on the remaining contractual term.

Expected Volatility :

Since we have limited trading history of CDIs in 2022, interests in our common stock, the expected volatility is determined based on the historical stock volatilities of our comparable companies, and the Company’s trading data since listing on the ASX.

Comparable companies consist of public companies in our industry, which are similar in size, stage of life cycle and financial leverage.

As of 2024, expected term assumptions are all historical data for the Company’s common stock.

Risk-Free Interest Rate:

The risk-free interest rate is based on U.S.

Treasury constant maturity rates with remaining terms similar to the expected term of the options.

Expected Dividend Rate :

The Company has never paid any dividends and does not plan to pay dividends in the foreseeable future, and, therefore, an expected dividend rate of zero is used in the valuation model.

Equity Awards Issued in Connection with Business Combinations

In connection with the Tile Acquisition in January 2022, the Company issued 1,499,349 shares of retention RSUs with an aggregate fair value of $ 29.6 million.

Of the 1,499,349 shares of retention restricted stock units, 787,446 shares valued at $ 15.6 million contained performance vesting criteria based on the achievement of certain company milestones during the three months ended March 31, 2022, and vest over a two year period.

As of March 31, 2022, the vesting criteria had not been met and all 787,446 restricted stock units were forfeited.

The remaining 711,903 retention restricted stock units vest over a two to four year period.

As of December 31, 2024, there was $ 0.3 million of unrecognized compensation expense related to the retention restricted stock units which is expected to be recognized over the remaining weighted average life of 1.0 year.

As of December 31, 2023, there was $ 0.7 million of unrecognized compensation expense related to the retention restricted stock units which is expected to be recognized over the remaining weighted average life of 1.9 years.

The Company also issued 38,730 vested common stock options to Tile employees as stock-based compensation on the acquisition date.

The aggregate fair value of $ 0.4 million was recognized as compensation expense on the date of acquisition.

A total of 694,672 shares of common stock with an aggregate fair value of $ 13.7 million were issued to Tile shareholders as part of purchase consideration.

All $ 13.7 million was included within purchase consideration.

A total of 1,561 shares of common stock with an aggregate fair value of $ 30.8 thousand were issued to a key employee, the vesting of which is subject to continued employment over a 30 -month period.

As of December 31, 2024 and 2023, there was an immaterial amount of unrecognized compensation expense related to unvested restricted stock units which is expected to be recognized over the remaining 0 years and 0.5 years, respectively.

Life360, Inc.

Notes to Consolidated Financial Statements

A total of 84,524 shares of common stock were issued as part of consideration transferred and were placed in an indemnity escrow fund to be held for fifteen months after the acquisition date for general representations and warranties.

The aggregate fair value of $ 1.7 million was included within purchase consideration.

All 84,524 shares of common stock were released from escrow in April 2023 as scheduled.

Stock-Based Compensation

2 unchanged sentences

2025 2024 2023

Cost of revenue

Subscription costs $ 730 $ 651 $ 684

Hardware costs 798 1,096 514

Other costs 4 43 237

Cost of subscription revenue $ 1,869 $ 730 $ 651

Cost of hardware revenue 1,476 798 1,096

Cost of other revenue 8 4 43

Total cost of revenue 3,353 1,532 1,790

2 unchanged sentences

General and administrative 17,041 11,936 11,648

Total stock-based compensation expense $ 42,269 $ 38,512 $ 34,680

There was $ 0.7 million of capitalized stock-based compensation costs during the year ended December 31, 2024.

There was an immaterial amount of capitalized stock-based compensation costs during the years ended December 31, 2023 and 2022.

The Company has historically incurred pre-tax net operating losses only in the United States since its inception.

During the year ended December 31, 2024, the Company incurred $ 5.5 million of pre-tax net operating losses in the United States and $ 0.9 million of pre-tax net operating income internationally.

An income tax provision (benefit) of $( 0.1 ) million, $ 0.6 million and $ 0.1 million was recorded for the years ended December 31, 2024, 2023 and 2022, respectively.

In accordance with ASC 805, a change in the acquirer’s valuation allowance that stems from a business combination should be recognized as an element of the acquirer’s income tax expense or benefit in the period of the acquisition.

The reconciliation of the Company’s effective tax rate to the U.S.

statutory federal income tax rate was as follows:

Total stock-based compensation expense, net of amounts capitalized

$ 55,460 $ 42,269 $ 38,512

There was $ 1.3 million and $ 0.7 million of capitalized stock-based compensation costs during the years ended December 31, 2025 and 2024, respectively.

There was an immaterial amount of capitalized stock-based compensation costs during the year ended December 31, 2023.

During the year ended December 31, 2025, the Company incurred $ 30.6 million of pre-tax net operating income in the U.S.

and $ 2.0 million of pre-tax net operating income internationally.

The Provision for (benefit from) income taxes is composed of the following (in thousands):

Year Ended December 31,

2025 2024 2023

Statutory federal income tax rate 21 % 21 % 21 %

State tax rate 43 % ( 3 ) % — %

Research and development tax credits 103 % 5 % — %

State and local $ 181 $ ( 71 ) $ 616

Total current

181 ( 71 ) 616

Federal ( 104,351 ) — —

State and local ( 14,003 ) — —

Total deferred

( 118,354 ) — —

Provision for (benefit from) income taxes

$ ( 118,173 ) $ ( 71 ) $ 616

Life360, Inc.

Notes to Consolidated Financial Statements

The reconciliation of the Company’s effective tax to the U.S.

statutory federal income tax is as follows:

Year Ended December 31,

2025 2024 2023

(in thousands)

(in thousands) Percent (in thousands) Percent

Statutory federal income tax

$ 6,858 21 % $ ( 972 ) 21 % $ ( 5,640 ) 21 %

State and local income taxes, net of federal income tax effect (1)

( 10,264 ) ( 31 ) % 114 ( 2 ) % 338 ( 1 ) %

Research & development tax credits

( 2,915 ) ( 9 ) % ( 4,805 ) 104 % ( 2,296 ) 9 %

Change in valuation allowance

( 87,509 ) ( 269 ) % 11,936 ( 259 ) % 4,475 ( 18 ) %

Nondeductible items

Stock issuance cost

— % 1,178 ( 25 ) % — %

Stock-based compensation

( 30,207 ) ( 92 ) % ( 12,641 ) 273 % ( 267 ) 1 %

Other permanent differences

1,069 3 % 157 ( 3 ) % 239 ( 1 ) %

Officer compensation - 162(m)

7,794 24 % 4,701 ( 102 ) % 2,666 ( 10 ) %

Fair value adjustment

Permanent differences ( 4 ) % ( 1 ) % ( 2 ) %

Officer Compensation ( 102 ) % ( 10 ) % — %

Change in valuation allowance ( 303 ) % ( 14 ) % ( 19 ) %

Stock issuance

— % 154 ( 3 ) % 181 ( 1 ) %

Effective tax rate 2 % ( 2 ) % — %

Meals & entertainment

80 — % 53 ( 1 ) % 72 — %

Worldwide changes in unrecognized tax benefits ( 3,079 ) ( 9 ) % 54 ( 1 ) % 909 ( 3 ) %

Foreign tax effects

Canadian rate differential

128 — % 71 ( 2 ) % 18 — %

Canadian SRED credit (2)

( 406 ) ( 1 ) % 1,065 ( 23 ) % ( 704 ) 3 %

Canadian valuation allowance

278 1 % ( 1,136 ) 25 % 625 ( 2 ) %

Effective income tax

$ ( 118,173 ) ( 362 ) % $ ( 71 ) 2 % $ 616 ( 2 ) %

(1) The states and local jurisdictions that contribute to the majority (greater than 50%) of the tax effect in this category include Illinois, California, New York, Georgia, Pennsylvania, and Tennessee.

(2) Canadian SRED credit refers to the Canadian Scientific Research and Experimental Development tax incentive program.

Life360, Inc.

5 unchanged sentences

Lease liability 85 175

Depreciable assets — 162

Net operating loss carryforward 80,404 52,776

2 unchanged sentences

Credits carryforward 22,033 16,937

June 2025 Convertible Notes 7,157 —

Total deferred tax assets 145,427 118,782

Deferred tax liabilities

Operating lease right-of-use asset ( 165 ) ( 250 )

Operating lease ROU asset ( 80 ) ( 165 )

Depreciable assets ( 274 ) ( 125 )

3 unchanged sentences

Valuation allowance and other reserves ( 8,544 ) ( 107,012 )

Net deferred tax asset $ — $ —

The Company has provided a full valuation allowance on the net deferred tax assets.

The valuation allowance increased by $ 12.9 million during 2024 and $ 4.5 million during 2023.

Deferred tax assets, net $ 126,418 $ —

The valuation allowance decreased by $ 98.5 million during 2025 due to the release of the valuation allowance on the Company’s U.S.

and state deferred tax assets.

As a result of the release, the Company recognized $ 126.4 million of previously unrecognized net deferred tax assets on the consolidated balance sheet.

Additionally, the Company recorded $ 118.4 million in Provision for (benefit from) income taxes on the consolidated statement of operations and comprehensive income (loss), and $ 8.0 million as an increase to Additional paid-in capital related to the purchase of the June 2025 Capped Calls on the consolidated statement of stockholders’ equity.

The remaining valuation allowance of $ 8.5 million primarily relates to California state tax credits and Canadian SRED credits as of December 31, 2025.

Since the Company mainly conducts research and development activities in California, but earns a substantial portion of its U.S.

income in other states, the Company could not assert, at the required more likely than not level of certainty, that it would generate future taxable California income sufficient to realize the benefit of those deferred tax assets.

Similarly, the Company has historically generated more Canadian tax credits than it utilizes each year.

Accordingly, the Company maintained a valuation allowance specific to California state tax credits and Canadian SRED credits.

At December 31, 2025 the Company had approximately $ 339.9 million and $ 135.4 million of federal and state net operating loss carryforwards, respectively, available to offset future taxable income.

10 unchanged sentences

Subsequent ownership changes may affect the limitation in future years.

Life360, Inc.

Notes to Consolidated Financial Statements

The Company files income tax returns in the U.S.

4 unchanged sentences

As of December 31, 2025 and 2024, the Company had $ 7.4 million and $ 12.0 million, respectively, of gross unrecognized tax benefits related to federal and state research credits.

As of December 31, 2024 all unrecognized tax benefits, if recognized, will not affect the Company’s effective tax rate.

The Company does not anticipate any unrecognized tax benefits in the next 12 months that would result in a material change to its financial position.

Life360, Inc.

Notes to Consolidated Financial Statements

The aggregate changes in the balance of gross unrecognized tax benefits were as follows (in thousands):

As of December 31, 2025, $ 5.0 million of these unrecognized tax benefits, if recognized, would affect the Company’s effective tax rate.

T he aggregate changes in the balance of gross unrecognized tax benefits were as follows (in thousands):

Balance as of December 31, 2023

Additions based on tax positions related to 2024

Additions for tax positions of prior years —

Reductions for tax positions of prior years ( 2,077 )

Balance as of December 31, 2024

2 unchanged sentences

Balance as of December 31, 2025

The amounts of cash paid (refunds received) during the period for income taxes, net were as follows (in thousands):

Year Ended December 31,

2025 2024 2023

$ — $ 481 $ —

State and local

( 893 ) 1,900 697

Cash paid (refunds received) during the period for income taxes, net $ ( 893 ) $ 2,381 $ 697

Related-Party Transactions

Hubble Transactions

In November and December 2024, the Company entered into a strategic partnership and series of transactions with Hubble Network, Inc.

(“Hubble”), including (i) a technology exclusivity and revenue share agreement (“Hubble Agreement”), (ii) a Hubble SAFE investment (“Related Party SAFE”);

In 2024, the Company entered into a strategic partnership and series of transactions with Hubble Network, Inc.

(“Hubble”) including (i) a technology exclusivity and revenue share agreement (the “Hubble Agreement”), (ii) a Hubble SAFE investment (the “Related Party SAFE”);

and (iii) Hubble’s issuance of a warrant to purchase common stock (“Related Party Warrant”).

The Hubble Agreement has an initial term of 5 years beginning on November 12, 2024.

Alex Haro, the founder, and Chief Executive Officer of Hubble is a co-founder, former executive, and existing member of the Company’s Board of Directors.

In addition, as part of the agreement, the Company obtained an observer right to Hubble’s board of directors.

As a result, all transactions with Hubble entered into in connection with the strategic partnership are considered related party transactions.

As part of this partnership, the Company will leverage Hubble’s global satellite infrastructure to introduce a new global location-tracking network service offering.

1 unchanged sentence

Refer to Note 2, "Summary of Significant Accounting Policies" for additional information.

As of December 31, 2024, the Company earned no net revenue from the revenue share arrangement.

As of December 31, 2025, and 2024, the Company earned immaterial net revenue from the revenue share arrangement.

The partnership also allows Hubble to purchase Tile hardware devices at a price equal to the Company’s burdened cost of goods sold plus 12.5 %.

During the year ended December 31, 2024, the Company recognized $ 0.1 million in hardware revenue from sales to Hubble, which is also included in accounts receivable, net, as of year-end on the Company’s consolidated balance sheet.

Alex Haro, the founder, and Chief Executive Officer of Hubble is a co-founder, former executive, and existing member of the Company’s Board of Directors.

In addition, as part of the agreement, the Company obtained an observer right to Hubble’s Board of Directors.

As a result, all transactions with Hubble entered into in connection with the strategic partnership are considered related party transactions.

During the years ended December 31, 2025 and 2024, the Company recognized $ 0.2 million and $ 0.1 million in hardware revenue from sales to Hubble, respectively.

The related cost of hardware revenue totaled $ 0.1 million and zero during the years ended December 31, 2025 and 2024, respectively.

These amounts are reflected within hardware revenue and cost of hardware revenue, respectively, on the Company’s consolidated statements of operations and comprehensive income (loss).

As of December 31, 2025 and 2024, the Company recorded immaterial amounts and $ 0.1 million of accounts receivable, net from Hubble, respectively, on the Company’s consolidated balance sheets.

Life360, Inc.

Notes to Consolidated Financial Statements

As of December 31, 2025, 2,049,191 shares of the Related Party Warrant have vested.

The carrying value of the warrants as of December 31, 2025 and 2024, was $ 3.9 million and is also included in prepaid expenses and other assets, noncurrent.

The related deferred revenue, current and deferred revenue, noncurrent balance as of December 31, 2025 was $ 0.8 million and $ 2.2 million, respectively.

The deferred revenue, current and deferred revenue, noncurrent balance as of December 31, 2024 was $ 0.9 million and $ 3.0 million, respectively.

The fair value of the warrant included within deferred revenue is amortized to other revenue over the life of the agreement.

The Company recognized $ 0.9 million and zero in other revenue on the consolidated statements of operations and comprehensive income (loss) in connection with the Related Party Warrant during the year ended December 31, 2025 and 2024, respectively.

Refer to the “Other Revenue” section of “Note 2, "Summary of Significant Accounting Policies" for additional information on the Related Party Warrant.

As of December 31, 2024, the carrying value of the Related Party SAFE was $ 5.0 million and included within prepaid expenses and other noncurrent assets on the consolidated balance sheet.

In April 2025, the Related Party SAFE converted to the Related Party Investment and resulted in a gain of $ 0.9 million, which was recorded within gain on change in fair value of investments on the consolidated statement of operations and comprehensive income (loss).

As of December 31, 2025, the carrying value of the Related Party Investment was $ 5.9 million and is included within prepaid expenses and other noncurrent assets on the consolidated balance sheet.

Refer to Note 5, "Fair Value Measurements" for additional information.

Payments made on behalf of Related Parties in connection with the U.S.

5 unchanged sentences

A summary of the expenses paid on behalf of the selling securityholders is detailed below (in millions):

Life360, Inc.

Notes to Consolidated Financial Statements

Year Ended December 31, 2024

3 unchanged sentences

(1) Includes $ 0.7 million in expenses paid on behalf of a securityholder who is both an executive officer and member of the board of directors.

The $ 5.5 million in total fees paid have been recorded within Other income (expense), net on the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024.

The $ 5.5 million in total fees paid have been recorded within Other income (expense), net on the consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2024.

For additional details regarding this transaction, refer to the prospectus supplement filed with the SEC on June 6, 2024 as well as the registration statement on Form S-3 (File No.

333-279271) filed with the SEC on May 9, 2024, of which the prospectus supplement forms a part.

Other Related Party Transactions

Non-executive director, James Synge, is a Principal and Partner of Carthona Capital.

During the year ended December 31, 2022, Carthona Capital received consideration of $ 0.1 million for consultancy services to the Company in relation to capital raising matters.

No similar payments were made for the years ended December 31, 2024 or 2023.

Defined Contribution Plan

1 unchanged sentence

Contributions made by the Company are voluntary and are determined annually by the Board of Directors on an individual basis subject to the maximum allowable amount under federal tax regulations.

Employer contributions to the plan were $ 1.2 million and $ 1.1 million for the years ended December 31, 2024 and December 31, 2023, respectively.

There were immaterial employer contributions to the plan for the year ended December 31, 2022

Net Loss Per Share

Basic net loss per share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding for the fiscal period.

Diluted net loss per share reflects the potential dilution that could occur if options, RSUs, PRSUs, warrants, or other securities that could result in the issuance of common stock were exercised or converted to common stock using the treasury-stock method.

The dilutive effect of the outstanding September 2021 Convertible Notes and July 2021 Convertible Notes are reflected in diluted net loss per share by application of the if-converted method for the years ended December 31, 2023 and 2022.

Employer contributions to the plan were $ 1.4 million, $ 1.2 million, and $ 1.1 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Life360, Inc.

Notes to Consolidated Financial Statements

The following table presents the calculation of basic and diluted net loss per share (in thousands, except share and per share data):

Net Income (Loss) Per Share

The Company computes basic and diluted net income (loss) per share in conformity with ASC 260, Earnings per Share.

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period.

Diluted net income (loss) per share reflects the potential dilution that could occur from securities that may result in the issuance of common stock and is calculated using the treasury stock method.

Potential common shares are excluded from diluted net income (loss) per share when their effect would be antidilutive.

The following table presents the calculation of basic and diluted net income (loss) per share (in thousands, except share and per share data):

Year Ended December 31,

2025 2024 2023

Net loss $ ( 4,555 ) $ ( 28,171 ) $ ( 91,629 )

Weighted-average shares used in computing net loss per share, basic 72,125,571 66,748,542 62,209,545

Net loss per share, basic $ ( 0.06 ) $ ( 0.42 ) $ ( 1.47 )

Net income (loss)

$ 150,832 $ ( 4,555 ) $ ( 28,171 )

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

77,251,239 72,125,571 66,748,542

Net income (loss) per share, basic

$ 1.95 $ ( 0.06 ) $ ( 0.42 )

Year Ended December 31,

2025 2024 2023

Net loss $ ( 4,555 ) $ ( 28,171 ) $ ( 91,629 )

(Gain)/loss attributable to September 2021 Convertible Notes — — ( 1,786 )

(Gain)/loss attributable to July 2021 Convertible Notes — — ( 1,295 )

Interest attributable to July 2021 and September 2021 Convertible Notes — — 515

Adjusted net loss for diluted earnings per share ( 4,555 ) ( 28,171 ) ( 94,195 )

Weighted-average shares used in computing net loss per share, basic 72,125,571 66,748,542 62,209,545

Net income (loss)

$ 150,832 $ ( 4,555 ) $ ( 28,171 )

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

77,251,239 72,125,571 66,748,542

Effect of dilutive securities:

September 2021 Convertible Notes — — 453,626

July 2021 Convertible Notes — — 176,422

Adjusted weighted-average shares used in computing net loss per share, diluted 72,125,571 66,748,542 62,839,593

Net loss per share, diluted $ ( 0.06 ) $ ( 0.42 ) $ ( 1.50 )

The potential shares of common stock that were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive are as follows:

June 2025 Convertible Notes 43,432 — —

Outstanding options, RSUs, and warrants 7,877,744 — —

Adjusted weighted-average shares used in computing net income (loss) per share, diluted

85,172,415 72,125,571 66,748,542

Net income (loss) per share, diluted

$ 1.77 $ ( 0.06 ) $ ( 0.42 )

The potential shares of common stock that were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive are as follows:

Year Ended December 31,

1 unchanged sentence

Issuances under stock incentive plan, stock options

— 5,673,947 6,625,812

Issuances upon exercise of common stock warrants

— 7,761 137,658

Issuances upon vesting of restricted stock units

106,496 5,091,601 6,182,543

Issuances upon conversion of convertible notes — — 325,981

3 unchanged sentences

Subsequent Events

On February 27, 2025, the Company entered into an Asset Purchase Agreement with Fantix, Inc., to purchase certain assets of Fantix, Inc., for a total consideration of $ 4.5 million.

On January 2, 2026, the Company completed the acquisition of Nativo, Inc., acquiring all outstanding equity interests.

The total consideration was approximately $ 106.0 million, and consisted of $ 78.0 million in cash and $ 28.0 million in shares of the Company’s common stock, measured based on the closing market price on the acquisition date in accordance with ASC 805.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data