Oura’s IPO Reveals High Growth for Smart-Ring Maker
The fitness tracker recently turned profitable and posted 74% revenue growth in nine months ended in June
- Smart-ring maker Oura made its IPO paperwork public on Thursday and aims to list on the Nasdaq as soon as this month.
- Oura posted revenue of $1.21 billion and a profit of $60.8 million for the nine months ended June 30.
- The company has five million paying members and reported gross margins of 89% on memberships for the nine-month period.
Smart-ring maker Oura made its IPO paperwork public on Thursday, offering a view of the high margins and committed user base behind the buzzy fitness tracker.
The San Francisco-based company is aiming to list on the Nasdaq as soon as this month. It is expected to fetch a valuation well above the $11 billion mark achieved in a funding round last year, The Wall Street Journal previously reported.
For the nine months ended June 30, Oura posted revenue of $1.21 billion, up 74% from the same period last year. The company said it recently turned profitable and earned $60.8 million in the period, up from $1.6 million in the same period last year.
Founded in Finland in 2013, Oura is popular among health and longevity enthusiasts. In recent years, the company has signed high-profile deals with sports leagues and celebrity ambassadors, and it cited the Defense Department as a key revenue generator.
Its rings track metrics such as heart rate, temperature and sleep quality and retail for $349 to $499. Subscribers then pay $5.99 a month, or $69.99 a year, for full access to insights on their health. The company said it has five million paying members.
The filing revealed a lucrative—and sticky—subscription business. Gross margins on memberships were 89% in the nine months ended June 30, the company said. Subscribers opened the Oura app more than 3.5 times a day on average in the first three quarters of the fiscal year, it said.
In the nine months ended June 30, hardware sales accounted for about 80% of revenue, and subscriptions made up the remaining 20%.
The company provided details on what would be an enviable user base for most companies: 72% are women, 42% of subscribers are ages 30 to 45, and 31% are under 29.
Oura pitched itself as a health-intelligence platform rooted in data from the rings. It said it has collected nearly 42 billion hours of biometric data.
In a section disclosing risks to investors, Oura said its rapid growth might not be sustainable. “We expect our growth rate to slow over time,” it said.
The company also listed user retention, a competitive market and changes to tax-advantaged accounts as potential risks.
The filing lists 18 firms as underwriters, and Oura said Goldman Sachs, Morgan Stanley, JPMorgan, Allen & Co. and Jefferies were the lead bookrunners on the deal. The list also includes Robinhood, the retail brokerage that has been trying to get a bigger role in IPOs so its customers can access the deals.
The filing doesn’t disclose yet the amount of money Oura intends to raise in the initial public offering, but it plans to list on the Nasdaq under the ticker OURA.