LiveOne, Inc. (NASDAQ:LVO) shares are trading lower on Tuesday following its amended partnership with Tesla, Inc. (NASDAQ:TSLA).
LiveOne renewed its partnership with the EV behemoth through May 2026. Effective today, Tesla replaced its streaming button with LiveOne's in perpetuity.
The company also announced the launch of its LiveOne 2.0, for subscribers access to music on all devices. About 1.9 million subscribers can convert to Premium/Plus services.
As of Dec 1, 2024, Tesla will no longer subsidize LiveOne products to some of its customers. However, LiveOne will offer all Tesla customers discounted LiveOne music packages, the company said.
"The conversion opportunity has enormous upside by offering Tesla owners an opportunity to upgrade and have access on all devices at discounted priority pricing," said Robert Ellin, CEO of LiveOne.
Tesla will continue to pay LiveOne monthly for grandfathered users in perpetuity.
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"We'll drive growth, unlock new revenue streams, own our data, and increase ARPU. To be conservative, due to the timing of our conversion rate, we are adjusting FY2025 revenue guidance to $120M – $135M and $8-15M adjusted EBITDA," the CEO added.
Outlook: For fiscal year 2025, LiveOne revised its consolidated revenue from $140 million – $155 million to $120 million – $135 million (estimate: $144.99 million), with consolidated adjusted EBITDA projected at $8 million – $15 million (prior view $16 million – $20 million).
The company has reaffirmed its $12 million share buyback program and officially retired 4.2 million shares, bringing the total outstanding shares to approximately 94 million.
Price Action: LVO shares are trading lower by 21.4% to $0.7460 at last check Tuesday.
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