Owlet, Inc. (NYSE: OWLT) announced a strategic partnership with webAI, a private AI platform focused on secure, private‑AI solutions, on February 3 2026. The collaboration will use Owlet’s proprietary infant health and sleep data to build private, enterprise‑grade intelligence that can be embedded across Owlet’s smart sock, BabySat, and Owlet360 subscription services, positioning the company to deepen its competitive moat in the pediatric health market.
Owlet’s most recent quarterly results underscore the urgency of this shift. In Q3 2025 the company posted record revenue of $32.0 million, a 44.6% increase from the same period in 2024, and a net income of $4.1 million versus a $5.6 million loss in Q3 2024. Gross margin stood at 50.6%, down 150 basis points year‑over‑year, largely due to tariff‑related cost pressures on imported components. Management projected 2025 revenue of $103–$106 million, gross margins of 48–50%, and adjusted EBITDA of $1.25–$2 million, reflecting confidence in continued growth while acknowledging margin compression.
The partnership with webAI is a key lever in Owlet’s broader strategy to transition from a hardware‑centric business to a comprehensive pediatric health platform. By keeping data on‑premises and leveraging webAI’s privacy‑first architecture, Owlet can offer highly personalized insights while safeguarding sensitive health information—a critical requirement for regulatory compliance and consumer trust. The collaboration also accelerates the deployment of AI‑driven features across Owlet’s product ecosystem, enabling new revenue streams such as subscription analytics and potential clinical‑grade monitoring services.
Jonathan Harris, Owlet’s President and CEO, said the alliance “strengthens Owlet’s competitive position and further empowers parents in the care of their children.” He added that the partnership will “accelerate our ability to build private, enterprise‑grade intelligence directly on our data, an approach that prioritizes security, scalability, and durability.” David Stout, CEO of webAI, noted that Owlet’s “trusted platform in infant health with a unique depth of pediatric data” provides a rare opportunity to unlock specialized intelligence that improves with every interaction while keeping family data protected.
Looking ahead, Owlet’s guidance for 2025 signals sustained growth momentum. The company expects revenue to rise 32–36% year‑over‑year, supported by expanding subscription services and new AI‑enabled product features. Gross margins are projected to remain in the high‑40s, reflecting ongoing cost discipline and the higher mix of data‑centric services. Management remains optimistic about the long‑term value of the AI partnership, viewing it as a catalyst for deeper customer engagement and new market opportunities.
Owlet operates in a competitive infant monitoring landscape that includes Masimo and iRhythm Technologies. The partnership with webAI differentiates Owlet by combining its 2.5 million‑user data base with advanced AI capabilities, positioning the company to capture a larger share of the growing pediatric health market and to explore clinical‑grade monitoring applications that could open new revenue channels beyond consumer hardware.
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