The fund manager Wilson Asset Management (WAM) is always looking for opportunities and ASX tech share Life360 Inc (ASX: 360) could be worth owning if WAM is right about the business.
Life360 is a location-based tracking software company which has been on a very impressive trajectory in recent times. As the chart below shows, the Life360 share price has climbed more than 40% in 2025 to date and the fund manager is optimistic that the company is still undervalued.
Let's take a look at why WAM is still excited about the business.
Wilson Asset Management noted that the latest rise in the Life360 share price came after the business announced its FY25 first quarter update.
The reason for the strong positive reaction? WAM said the quarterly performance exceeded what the market was estimating for the quarter across all key metrics, including earnings, which increased 32% year-over-year.
The ASX tech share also reported that annualised monthly revenue (AMR) increased by 38% year over year to $393 million. Underlying operating profit (adjusted EBITDA) increased by $11.6 million to $15.9 million and it delivered positive operating cash flow of $12.1 million, up 13% year over year.
Helping this growth was its rise of users. Life360 reported that global monthly active users (MAU) net additions were 4.1 million, while total MAUs increased 26% year over year to approximately 83.7 million. Global paying circle net additions in the first quarter of 2025 were 137,000, up 43% year over year. Total paying circles grew 26% year over year to 2.4 million, supported by improved retention in the US.
The investment team believe the outlook for Life360 shares remains strong, with FY25 subscription revenue guidance revised upwards.
On top of that, WAM pointed out that Life360 also announced a US$25 million investment in artificial intelligence (AI) safety outfit Aura, which signalled "a strategic move to enhance its product offerings and market position."
Explaining why the investment team are still bullish on the business, WAM said:
We believe the market continues to underappreciate the opportunity within Life360's advertising business, whilst still in its infancy, has the capacity to match the size of the subscription business in the medium-term and expand revenue growth.
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