On this page of StockholderLetter.com we present the latest annual shareholder letter from Owlet, Inc. — ticker symbol OWLT. Reading current and past OWLT letters to shareholders can bring important insights into the investment thesis.

 •  7/3/2024 Letter Continued (Full PDF)
 •  5/12/2023 OWLT Stockholder Letter
 •  More "Miscellaneous" Category Stockholder Letters
 •  OWLT Benford's Law Stock Score = 68

OWLT Shareholder/Stockholder Letter Transcript:

202     Annual Report


Dear Fellow Stockholders,
2023 was a transformative year for Owlet as we made significant progress in our mission to
improve infant health. It was a year intensely focused on critical areas necessary to stabilize
Owlet   s business and evolve it for a more sustainable future     obtaining regulatory
authorizations, stabilizing our business    costs and cash management, and at the same time,
improving our products    marketability and sell-through in our channels.
I am filled with pride as I reflect upon the unwavering dedication of our team, which has been
instrumental in propelling our business toward a bright future. Our successes solidify Owlet's
position as a leader in infant health technology, and I am grateful for the contributions of each
and every team member who made these achievements possible.
In 2023, we were committed to achieving three main objectives:
   In order to enhance marketing claims and features and explore new distribution
avenues, we sought FDA marketing authorizations for our prescription device,
BabySat   , and our over-the-counter device, Dream Sock  .
   Recognizing our high cash burn rate, we needed to reduce our operating and
production costs to near Adjusted EBITDA break-even by year-end.
   We also began 2023 with excess inventory in our retail channels. This situation
necessitated increased sell-through growth and reduced weeks on hand with key retail
partners.
These three areas, FDA marketing authorizations, Adjusted EBITDA break-even, and channel
health were all key areas of focus for our company during the past year.
I'm happy to announce that we successfully met all three of our goals.
In November 2023, Owlet obtained marketing authorization for Dream Sock, the first and only
over-the-counter device to provide certain live health readings for infants and notifications to
caregivers when readings move outside a specified range. In June 2023, we obtained an FDA
510(k) clearance for BabySat, a prescription-only pulse oximeter for home use. These
marketing authorizations have been significant foundational breakthroughs in our journey to
bring care to the home and empower parents, have opened up distribution channels, and have

created lucrative growth opportunities thus far in 2024. We are also particularly proud that our
products were shown to be effective and accurate across various skin tones and under realworld in-home environments - an important advancement toward our mission for every baby
and our industry as a whole.
To optimize our operations, we implemented several cost-saving measures in 2023. We
reduced marketing costs for acquisition by almost 80%, consolidated our vendor and partner
relationships, reduced headcount while improving our efficiencies, and minimized PPV and
warehousing costs associated with our products. As a result, our operating expenses decreased
by approximately 70%, while margins improved by over 1000 basis points, reaching nearly 50%
by the end of 2023.
In addition to the efficiency benefits of our cost-cutting efforts, we achieved significant growth
in sell-through during 2023 compared to 2022, exceeding 20% growth Year over Year. This sellthrough growth accelerated following FDA marketing authorization in November and
continued into 2024 with the U.S. commercial launch of both medical devices in January. This
growth contributed to reducing our overall weeks of stock (WOS) inventory to healthy levels
exiting 2023.
As 2023 came to a close, Owlet celebrated substantial achievements. Marketing authorizations
were obtained, the cost basis was significantly reduced, and consumer demand reached
unprecedented levels. These accomplishments propelled the company closer to Adjusted
EBITDA break-even, setting the stage for long-term growth and sustained profitability.
We're energized by the progress that we've made in 2023, and we're excited to build on this
momentum in 2024. Here are some key areas of focus for the coming year:
Owlet believes we will significantly increase adoption of our products and services in 2024. As
the first and only over-the-counter FDA-authorized infant health monitor, we believe that our
Dream Sock has the potential to lead the way in creating a category to reaching a far greater
number of households. We believe the introduction of new marketing strategies and product
features could position Owlet as a leader in pediatric health with medical-grade solutions for
at-home use. We anticipate our retail partners will expand Owlet's presence in-store and
online, leading to increased consumer awareness of our leadership in this market. Additionally,
we are focused on facilitating access to insurance coverage and reimbursement of our
products and services through our partners and potentially expanding access to BabySat for
families, provider networks and children's hospitals.

Owlet plans to expand globally, reaching even more families by building on the momentum of
our 2023 U.S. marketing authorizations. In May 2024, the Dream Sock was certified as a medical
device in the EU (CE marked) and the UK (UKCA marked), and we will continue to focus on
obtaining international regulatory medical device authorizations, clearances or certifications
for Dream Sock and broadening our pediatric health leadership globally.
Finally, Owlet is focusing in 2024 on launching our first subscription service. Acknowledging
the substantial number of healthcare visits and the sleep deprivation experienced by parents,
Owlet has amassed a vast and growing dataset of infant health. To bridge the communication
gap between parents and their babies, Owlet is developing software services that utilize this
dataset and broaden insights for parents, aiming to shift the center of care to the home.
Collectively these areas of adoption, international expansion and services represent a
substantial growth opportunity in 2024 and 2025.
At its center, Owlet is one community of parents, employees, non-profit organizations and
stockholders that share a collective vision for a world where every baby has a safe and healthy
journey. Our mission is to develop innovative technology that empowers parents to give care
at home. Our collective commitment is to do what   s right for baby and work tirelessly to get
the job done. We are one Owlet. These values guide us in everything we do, and they will
continue to be the foundation for our success.
I want to express my sincere gratitude to our entire team for their dedication and hard work.
Their commitment has been instrumental in our accomplishments this year. I also want to
thank you, our stockholders, for your continued support. We are committed to creating longterm value for all our stakeholders.
Sincerely,
Kurt Workman
CEO & Co-Founder



 7/3/2024 Letter Continued (Full PDF)