Vivint Refuses To Pay License Fees To Alarm.Com, Shares Plummet
Alarm.Com Holdings, Inc (NASDAQ: ALRM), the platform for intelligently connected property, disclosed that Vivint Inc refused to pay license fees to Alarm.com under the Patent Cross License Agreement between the companies.
Vivint has paid the required licensing fees to Alarm.com since the agreement came into force in November 2013.
Alarm.com disputed Vivint's refusal of payment, filed for arbitration per the agreement, and actively evaluated additional legal remedies.
Beginning with the fourth quarter of 2022, Alarm.com believes that quarterly SaaS and license revenue and total revenue will get hurt by approximately $6 million, or 2.8% of total revenue in the fourth quarter of 2022.
Alarm.com also expected the update to affect its quarterly earnings and cash flow by $6 million, plus additional legal fees.
Alarm.com also released preliminary third-quarter 2022 financial results.
Third quarter SaaS and license revenue will likely be $132.8 million-$133 million, above its guidance of $130.9 million-$131.1 million.
Third-quarter hardware revenue will likely be $82.0 million-$82.5 million.
Third quarter total revenue will likely be $215 million-$215.5 million, above the consensus of $210 million.
Price Action: ALRM shares traded lower by 9.39% at $61.15 on the last check Friday.
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