LGMK: Believe Recent and Planned New Product Launches Advance SaaS Strategy
By M. Marin
NASDAQ:LGMK
READ THE FULL LGMK RESEARCH REPORT
Transitioning to SaaS model from 1-time hardware sales focus, while maintaining traditional business
LogicMark, Inc. (NASDAQ:LGMK) is transitioning to a SaaS model from a 1-time hardware sales model, while maintaining its traditional business. LGMK expects new products and services to both diversify and augment its revenue streams; the SaaS model is expected to generate recurring revenue, cash flow and margin expansion, as LGMK introduces new connected products for the care economy and as the domestic and global population ages.
Under a new management team in place since 2021, the company’s goal is to innovate within the industry, including by enhancing preventive and predictive technology in the PERS experience. The company is optimistic about its ongoing innovation efforts. For example, management believes the touchscreen design of the newly introduced Freedom Alert Plus represents one of the first for the PERS industry. This product and the company’s developing Caring Platform as a Service (CPaaS) model are expected to enable LogicMark to capture data to monitor customers’ well-being in real-time and leverage AI and machine learning to optimize their care. With recent and expected upcoming product launches, LGMK’s product pipeline is the broadest it has been in more than two decades.
Given this initial stage of the company’s transition, we believe it is early to see the benefits of LogicMark’s new Care Village model and SaaS strategy in operating results. 3Q23 saw margin improvement reflecting cost and logistic initiatives implemented in recent months and we expect increasing improvements longer term.
As aging Baby Boomers, Seniors want to remain independent.…
The company believes it can extend its products and services to meet the increasing needs of the growing Care Economy. The population is aging. The ability to monitor people’s well-being remotely is therefore expected to grow in importance as baby boomers become seniors. Specifically, in the U.S. 10,000 baby boomers turn 65 every day. Demand for remote monitoring tools reflects the desire by many, if not most baby boomers, to live independently and also reflects a well-documented dearth of healthcare workers. More than 50 million people aged-65 years or older live in the U.S., according the Administration for Community Living, with more than 25% of this group living alone. With a large and growing market opportunity ahead, LogicMark believes that it is among the few companies in the space innovating to modernize remote monitoring devices and platforms.
… and potentially expanding target demographic, addressable market
Moreover, the company also expects to expand its target market demographic over time. The company is investing in new verticals such as consumer, pro-care / healthcare and corporate benefits, among others. While LogicMark’s PERS productions traditionally have been used by disabled and / or elderly adults, including those who are living alone, the company believes its technology solutions potentially could be expanded to additional demographics with personal safety concerns in the future, including children or students.
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