Why Owlet Shares Are Trading Lower Today

Owlet Inc OWLT reported FY21 sales of 75.8 million, just 0.6% higher than the $75.4 million reported a year ago.
The Company noted that through the first three quarters of 2021, revenues were $78.4 million, up 44% Y/Y, but early in Q4 FY21, Owlet received an FDA Warning Letter, resulting in halting sales of all Smart Sock products in the U.S.
The Company accepted returns for Smart Sock and Owlet Monitor Duo products; hence it recorded a contra-revenue adjustment of $23.2 million, resulting in total net negative revenues of $2.5 million for Q4 of 2021.
Owlet positions the Smart Sock Plus as a way to monitor a child's well-being.
Operating expenses reached $27.3 million compared to $13.5 million a year ago due to spending associated with the scaling of the business, including expanded headcount and higher marketing spend.
The Company reported a wider operating loss of $(33.3) million, compared to $(3.4) million a year ago.
The adjusted EPS loss was $(0.29) compared to $(0.14) in Q4 FY20, missing the consensus of $(0.14).
Guidance: Gross billings for January and February 2022 were slightly higher than at the same time in 2021.
The Company anticipates all of its major U.S. retailers will have the Dream product line fully available online and in stores by the end of Q1 of 2022 and refrains from issuing FY22 guidance.
Price Action: OWLT shares are down 9.31% at $2.24 during the market session on the last check Tuesday.

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