SmartRent, Inc.

Previous wording

We are an enterprise real estate technology company that provides a comprehensive management platform designed for property owners, managers and residents. Our suite of products and services, which includes cloud-based SaaS solutions, many of which are enabled by smart building hardware, provide seamless visibility and control over real estate assets. Our platform can lower operating costs, increase revenues, mitigate operational friction and protect assets for owners and operators, while providing a differentiated, elevated living experience for residents.

Current wording

We are a market-leading building intelligence provider delivering innovative data, technology and workflow solutions for the rental housing industry. Our suite of products and services, which includes cloud-based SaaS solutions, many of which are enabled by smart building hardware, provides seamless visibility and control over real estate assets. Our platform can lower operating costs, increase revenues, mitigate operational friction and protect assets for owners and operators, while providing a differentiated, elevated living experience for residents.

Previous wording

Through centrally connected devices ("Hub Devices"), which integrate our enterprise software with third party smart devices, we enable the integration of our platform with third-party smart devices, our own hardware devices and other technology interfaces. We use an open-architecture, brand-agnostic approach that allows owners, operators, and residents to manage their smart home systems through a single connected interface. Our Smart Community solutions include software and devices that power (i) smart apartments and homes, (ii) access control for buildings, common areas, and rental units, and other solutions such as asset protection and monitoring and self-guided tours. Our Smart Operations solutions include work order management, the automation of leasing and resident call handling, audit management, and the automation of the inspection process. We also have a professional services team that provides customers with training, installation, and support services.

Current wording

Through centrally connected devices ("Hub Devices"), which integrate our enterprise software with third party smart devices, we enable the integration of our platform with third-party smart devices, our own hardware devices and other technology interfaces. We use an open-architecture, brand-agnostic approach that allows owners, operators, and residents to manage their smart home systems through a single connected interface. Our Smart Communities Solutions include software and devices that power (i) smart apartments and homes, (ii) access control for buildings, common areas, and rental units, and (iii) other solutions such as asset protection and monitoring and self-guided tours. Our Smart Operations Solutions include work order management, the automation of leasing and resident call handling, audit management, and the automation of the inspection process. We also have a professional services team that provides customers with training, installation, and support services.

Previous wording

SmartRent is a category leader in the enterprise smart home solutions industry. As of June 30, 2026, we had 929,487 Units Deployed (as defined below) and approximately 600 customers who either have an active subscription or have purchased any SmartRent product in the past twelve months, including many of the largest multifamily residential owners in the United States. As of June 30, 2026, we believe our customers owned an aggregate of approximately 6.8 million rental units. This represents approximately 14% of the United States market for institutionally owned multifamily rental units and single-family rental homes. In addition to multifamily residential owners, our customers include some of the leading single-family rental homeowners, homebuilders, and iBuyers in the United States.

Current wording

SmartRent is a category leader in the enterprise smart home solutions industry. As of September 30, 2026, we had 941,977 Units Deployed (as defined below) and approximately 600 customers who either have an active subscription or have purchased any SmartRent product in the past twelve months, including many of the largest multifamily residential owners in the United States. As of September 30, 2026, we believe our customers owned an aggregate of more than 7.0 million rental units. This represents approximately 15% of the United States market for institutionally owned multifamily rental units and single-family rental homes. In addition to multifamily residential owners, our customers include some of the leading single-family rental homeowners, homebuilders, and iBuyers in the United States.

Previous wording

We generate revenue primarily from sales of smart home systems that enable property owners and property managers to have visibility and control over assets, while providing all-in-one home control offerings for residents. Our revenue is primarily generated from: (1) the direct sale to our customers of hosted services from subscription fees collected from customers to provide Hosted Services including access controls, asset monitoring, and related services; (2) the sale and delivery of smart home devices, which generally consist of a Hub Device, door-locks, thermostats, sensors, and light switches; and (3) installation and implementation of smart home devices that enable our Hosted Services. Subscription arrangements have contractual terms ranging from one month to ten years and the weighted average length of our recurring revenue contracts is 3.9 years.

Current wording

We generate revenue primarily from sales of smart home systems that enable property owners and property managers to have visibility and control over assets, while providing all-in-one home control offerings for residents. Our revenue is primarily generated from: (1) the direct sale to our customers of hosted services from subscription fees collected from customers to provide Hosted Services including access controls, asset monitoring, and related services; (2) the sale and delivery of smart home devices, which generally consist of a Hub Device, door-locks, thermostats, sensors, and light switches; and (3) installation and implementation of smart home devices that enable our Hosted Services. Subscription arrangements have contractual terms ranging from one month to ten years and the weighted average length of our recurring revenue contracts is 3.8 years.

Previous wording

We continue to experience improvements in the challenges related to the global supply chain. In prior periods, the increased demand for electronics as a result of the COVID-19 pandemic, U.S. trade relations with China and certain other factors in more recent periods led to a global shortage of semiconductors, including Z‑wave chips, which are a central component of our Hub Devices. Due to this shortage in prior periods, we experienced Hub Device production delays, which affected our ability to meet scheduled installations and facilitate customer upgrades to our higher-margin Hub Devices. We also experienced shortages and shipment delays related to components for access control systems and made-to-order specialty locks.

Current wording

We continue to experience changes related to the global supply chain. In prior periods, the increased demand for electronics as a result of the COVID-19 pandemic, U.S. trade relations with China and certain other factors in more recent periods led to a global shortage of semiconductors, including Z‑Wave chips, which are a central component of our Hub Devices. Due to this shortage in prior periods, we experienced Hub Device production delays, which affected our ability to meet scheduled installations and facilitate customer upgrades to our higher-margin Hub Devices. We also experienced shortages and shipment delays related to components for access control systems and made-to-order specialty locks and volatility in costs related to changes in tariffs.

Previous wording

We are evolving our business into a more diverse platform with new products, features and functionality that enhance the value of our smart home operating system. We have introduced a number of SaaS product enhancements and features, including Answer Automation and Work Management solutions, that streamline property management operations. Our Smart Operations Solutions enhance our overall platform offering and customer value proposition by providing a comprehensive one-stop platform that broadens our support of property operations, enhancing the experience for residents, property owners and managers. We offer an open-API architecture that enables third-party partner integrations, resulting in a multi-functional platform that enhances property management workflow efficiencies, empowers team productivity, elevates resident interactions, and improves resident living experiences. In the future, we intend to unify our platform with deeper use of data, analytics and AI, and simplify our hardware architecture while expanding software offerings.

Current wording

We are evolving our business into a more diverse platform with new products, features and functionality that enhance the value of our smart home operating system. We have introduced a number of SaaS product enhancements and features, including Answer Automation and Work Management solutions, that streamline property management operations. Our Smart Operations Solutions enhance our overall platform offering and customer value proposition by providing a comprehensive one-stop, integrated platform that broadens our support of property operations, enhancing the experience for residents, property owners and managers. We offer an open-API architecture that enables third-party partner integrations, resulting in a multi-functional platform that enhances property management workflow efficiencies, empowers team productivity, elevates resident interactions, and improves resident living experiences. In connection with our strategic Vision 2028 objectives, we are investing in platform unification with deeper use of data, analytics and AI, and to simplify our hardware architecture while expanding software offerings.

Previous wording

Our future growth depends in part on the continued consumer adoption of software and hardware products which improve the resident experience and the growth of this market. We need to deliver solutions that enhance the resident experience and deliver value to our customers, rental property owners and operators, as well as homebuilders and developers, by providing products and solutions designed to enhance visibility and control over assets while providing additional revenue opportunities. In prior years, we experienced headwinds to adoption as certain customers deferred capital expenditures, driven by broader macroeconomic conditions, which resulted in a decrease in Units Shipped and New Units Deployed. In addition, changes in our executive leadership and the structure of our sales organization have impacted sales and overall volumes.

Current wording

Our future growth depends in part on the continued consumer adoption of software and hardware products which improve the resident experience and the growth of this market. We need to deliver solutions that enhance the resident experience and deliver value to our customers, rental property owners and operators, as well as homebuilders and developers, by providing products and solutions designed to enhance visibility and control over assets while providing additional revenue opportunities. In prior years, we have experienced headwinds to adoption of our Smart Communities Solutions as certain customers deferred capital expenditures, driven by broader macroeconomic conditions, which resulted in a decrease in Units Shipped and New Units Deployed. In addition, changes in our executive leadership and the structure of our sales organization have impacted sales and overall volumes. Sales of our Smart Operations Solutions have also been negatively impacted by those same factors as well as by increased competition from companies that offer maintenance solutions such as (i) a stand-alone offering or (ii) part of a broader product offering.

Previous wording

We regularly monitor a number of operating metrics in order to evaluate our operating performance, identify trends affecting our business, formulate business plans, measure our progress and make strategic decisions. Our key metrics are not based on any standardized industry methodology and are not necessarily calculated in the same manner or comparable to similarly titled measures presented by other companies. Similarly, our key metrics may differ from estimates published by third parties or from similarly titled metrics of our competitors due to differences in methodology. The numbers that we use to calculate our key metrics are based on internal data. While these numbers are based on what we believe to be reasonable judgments and estimates for the applicable period of measurement, there are inherent challenges in measuring such information. We regularly review and may adjust our processes for calculating our internal metrics to improve their accuracy.

Current wording

We regularly monitor a number of operating metrics in order to evaluate our operating performance, identify trends affecting our business, formulate business plans, measure our progress and make strategic decisions. Our key metrics are not based on any standardized industry methodology and are not necessarily calculated in the same manner or comparable to similarly titled measures presented by other companies. Similarly, our key metrics may differ from estimates published by third parties or from similarly titled metrics of our competitors due to differences in methodology. The numbers that we use to calculate our key metrics are based on internal data. While these numbers are based on what we believe to be reasonable judgments and estimates for the applicable period of measurement, there are inherent challenges in measuring such information. We regularly review and may adjust our processes for calculating our internal metrics to improve their accuracy. We have a long sales cycle, and the timing of customer decisions and orders does not always align with our reporting periods. As a result, we are increasingly focused on trailing twelve-month metrics, which we believe provides a more meaningful view of underlying customer demand and the progress we are making in executing our go-to-market strategy.

Previous wording

We define Units Deployed as the aggregate number of Hub Devices that have been installed (including customer self-installations) and have an active subscription as of a stated measurement date. We utilize the Units Deployed metric to assess the health of our business and measure the trajectory of our growth. We define New Units Deployed as the aggregate number of Hub Devices that were installed (including customer self-installations) and resulted in a new active subscription during a stated measurement period. Although our revenue is primarily driven by New Units Deployed and the number of Units Deployed, due to the expansion of our products and services that don't require a Hub Device, and Hub Device upgrades that do not result in net new active subscriptions, the correlation between New Units Deployed and revenue is not as strong as it was historically. Although the correlation has decreased, New Units Deployed is still an indicator of our ability to acquire new customers and expand our relationships with our current customers. As of June 30, 2026 and 2025, we had an aggregate of 929,487 and 847,956 Units Deployed, respectively. For the three months ended June 30, 2026 and 2025, we had 18,857 and 21,068 New Units Deployed, respectively. For the six months ended June 30, 2026 and 2025, we had 39,519 and 39,182 New Units Deployed, respectively.

Current wording

We define Units Deployed as the aggregate number of Hub Devices that have been installed (including customer self-installations) and have an active subscription as of a stated measurement date. We utilize the Units Deployed metric to assess the health of our business and measure the trajectory of our growth. We define New Units Deployed as the aggregate number of Hub Devices that were installed (including customer self-installations) and resulted in a new active subscription during a stated measurement period. Although our revenue is primarily driven by New Units Deployed and the number of Units Deployed, due to the expansion of our products and services that do not require a Hub Device, and Hub Device upgrades that do not result in net new active subscriptions, the correlation between New Units Deployed and revenue is not as strong as it was historically. Although the correlation has decreased, New Units Deployed is still an indicator of our ability to acquire new customers and expand our relationships with our current customers. As of September 30, 2026 and 2025, we had an aggregate of 941,977 and 870,230 Units Deployed, respectively. For the trailing twelve months ended September 30, 2026 and 2025, we had 73,363 and 84,285 New Units Deployed, respectively.

Previous wording

We define Units Shipped as the aggregate number of Hub Devices that have been shipped to customers during a stated measurement period. Units Shipped is used to assess the trajectory of our growth and is an indicator of our ability to acquire new customers and expand our relationships with our current customers. However, we caution that Units Shipped also includes Hub Devices for upgrades and out of warranty replacements and may not be an indicator of New Units Deployed in future periods. For the three months ended June 30, 2026 and 2025, we had 23,249 and 26,543 Units Shipped, respectively. For the six months ended June 30, 2026 and 2025, we had 56,715 and 69,961 Units Shipped, respectively.

Current wording

We define Units Shipped as the aggregate number of Hub Devices that have been shipped to customers during a stated measurement period. Units Shipped is used to assess the trajectory of our growth and is an indicator of our ability to acquire new customers, expand our relationships with our current customers and to replace previously Units Deployed. Therefore, we caution that Units Shipped also includes Hub Devices for upgrades and out of warranty replacements and may not be an indicator of New Units Deployed in future periods. For the trailing twelve months ended September 30, 2026 and 2025, we had 107,423 and 114,197 Units Shipped, respectively.

Previous wording

We define Units Booked as the aggregate number of Hub Device units subject to binding orders executed during a stated measurement period that will result in a New Unit Deployed. We utilize the concept of Units Booked to measure the estimated near-term resource demand and the resulting approximate range of post-delivery revenue that we will earn and record. Units Booked represent binding orders only. For the three months ended June 30, 2026 and 2025, there were 48,254 and 24,319 Units Booked, respectively. For the six months ended June 30, 2026 and 2025, there were 64,846 and 42,529 Units Booked, respectively. We have a long sales cycle, and the timing of customer decisions and orders doesn’t always align with our reporting periods. As a result, we are increasingly focused on trailing twelve-month Units Booked, which we believe provides a more meaningful view of underlying customer demand and the progress we’re making in executing our go-to-market strategy. For the trailing twelve months ended June 30, 2026 and 2025, there were 112,560 and 80,218 Units Booked, respectively. For the three months ended June 30, 2026 and 2025, ARR related to Units Booked was $3,227 and $2,397, respectively. For the six months ended June 30, 2026 and 2025, ARR related to Units Booked was $5,122 and $4,643, respectively.

Current wording

We define Units Booked as the aggregate number of Hub Device units subject to binding orders executed during a stated measurement period that are expected to result in a New Unit Deployed. We utilize the concept of Units Booked to measure the estimated near-term resource demand and the resulting approximate range of post-delivery revenue that we will earn and record. Units Booked represent binding orders only. For the trailing twelve months ended September 30, 2026 and 2025, there were 122,510 and 85,250 Units Booked, respectively. For the trailing twelve months ended September 30, 2026 and 2025, ARR related to Units Booked was $10,417 and $8,855, respectively.

Previous wording

We define Bookings as the contract value of hardware, professional services, and the first year of ARR for binding orders executed during a stated measurement period, including renewals and upgrades. We utilize Bookings to measure revenue expected to be earned in future periods from orders contracted during the current period. For the three months ended June 30, 2026 and 2025, Bookings were $48,194 and $30,460, respectively. For the six months ended June 30, 2026 and 2025, Bookings were $66,665 and $57,640, respectively. For the trailing twelve months ended June 30, 2026 and 2025, Bookings were $124,676 and $107,203, respectively.

Current wording

We define Bookings as the contract value of hardware, professional services, and the first year of ARR for binding orders executed during a stated measurement period, including renewals and upgrades. We utilize Bookings to measure revenue expected to be earned in future periods from orders contracted during the current period. For the trailing twelve months ended September 30, 2026 and 2025, Bookings were $143,981 and $111,576, respectively.

Previous wording

We define SaaS Revenue as subscription revenue from fees paid by customers for access to one or more of SmartRent's software applications, including access controls, asset monitoring and related services, and our Community WiFi solution. We believe that SaaS Revenue growth demonstrates our ability to acquire new customers and to maintain and expand our relationships with existing customers. More specifically, we monitor our SaaS Revenue to assess the general health and trajectory of our Hosted Services business. Arrangements with customers do not provide the customer with the right to take possession of SmartRent's software at any time. Customers are granted continuous access to the services over the contractual period. As of June 30, 2026, approximately 31% of our ARR had prepaid payment terms. We believe that our customer base is inherently sticky given the barriers to entry associated with rolling out an integrated enterprise solution across a portfolio of rental units. For the three months ended June 30, 2026 and 2025, we generated SaaS Revenue of $16.1 million and $14.2 million, respectively. For the six months ended June 30, 2026 and 2025, we generated SaaS Revenue of $31.3 million and $28.2 million, respectively.

Current wording

We define SaaS Revenue as subscription revenue from fees paid by customers for access to one or more of SmartRent's software applications, including access controls, asset monitoring and related services. We believe that SaaS Revenue growth demonstrates our ability to acquire new customers and to maintain and expand our relationships with existing customers. More specifically, we monitor our SaaS Revenue to assess the general health and trajectory of our Hosted Services business. Arrangements with customers do not provide the customer with the right to take possession of SmartRent's software at any time. Customers are granted continuous access to the services over the contractual period. As of September 30, 2026, approximately 32% of our ARR had prepaid payment terms. We believe that our customer base is inherently sticky, especially with our Smart Communities Solutions customers, given the barriers to entry associated with rolling out an integrated enterprise solution across a portfolio of rental units. For the trailing twelve months ended September 30, 2026 and 2025, we generated SaaS Revenue of $62.5 million and $56.0 million, respectively.

Previous wording

We define ARR as the annualized value of our SaaS Revenue earned in the current quarter, which we calculate by taking the total amount of SaaS Revenue in the current quarter and multiplying that amount by four. We believe that ARR growth demonstrates our ability to acquire new customers and to maintain and expand our relationships with existing customers. More specifically, we monitor our ARR to assess the general health and trajectory of our Hosted Services business. As of June 30, 2026 and 2025, ARR was $64.5 million and approximately $56.9 million, respectively.

Current wording

We define ARR as the annualized value of our SaaS Revenue earned in the current quarter, which we calculate by taking the total amount of SaaS Revenue in the current quarter and multiplying that amount by four. We believe that ARR growth demonstrates our ability to acquire new customers and to maintain and expand our relationships with existing customers. More specifically, we monitor our ARR to assess the general health and trajectory of our Hosted Services business. As of September 30, 2026 and 2025, ARR was approximately $62.9 million and approximately $56.9 million, respectively.

Previous wording

We define Hardware ARPU as total hardware revenue during a given period divided by the total Units Shipped during the same period. Hardware ARPU is used to evaluate the effectiveness of our hardware pricing and assess our ability to market and sell our hardware offerings. For the three months ended June 30, 2026 and 2025, Hardware ARPU was $586 and $571, respectively. For the six months ended June 30, 2026 and 2025, Hardware ARPU was $511 and $486, respectively.

Current wording

We define Hardware ARPU as total hardware revenue during a given period divided by the total Units Shipped during the same period. Hardware ARPU is used to evaluate the effectiveness of our hardware pricing and assess our ability to market and sell our hardware offerings. For the trailing twelve months ended September 30, 2026 and 2025, Hardware ARPU was $558 and $489, respectively.

Previous wording

We define Professional Services ARPU as total professional services revenue during a given period divided by the total New Units Deployed, excluding customer self-installations, during the same period. Professional Services ARPU is used to assess our ability to effectively price our installation services. For the three months ended June 30, 2026 and 2025, Professional Services ARPU was $580 and $365, respectively. For the six months ended June 30, 2026 and 2025, Professional Services ARPU was $475 and $392, respectively.

Current wording

We define Professional Services ARPU as total professional services revenue during a given period divided by the total New Units Deployed, excluding customer self-installations, during the same period. Professional Services ARPU is used to assess our ability to effectively price our installation services. For the trailing twelve months ended September 30, 2026 and 2025, Professional Services ARPU was $469 and $426, respectively.

Previous wording

We define SaaS ARPU as total SaaS Revenue during a given period divided by the average aggregate Units Deployed in the same period divided by the number of months in the period. Average aggregate Units Deployed is calculated as the Units Deployed as of the current period plus the Units Deployed as of the previous period divided by two. SaaS ARPU is used to evaluate the effectiveness of our SaaS pricing and assess our ability to market and sell our various software solutions. For the three months ended June 30, 2026 and 2025, SaaS ARPU was $5.84 and $5.66, respectively. For the six months ended June 30, 2026 and 2025, SaaS ARPU was $5.74 and $5.67, respectively.

Current wording

We define SaaS ARPU as total SaaS Revenue during a given period divided by the average aggregate Units Deployed in the same period divided by the number of months in the period. Average aggregate Units Deployed is calculated as the Units Deployed as of the current period plus the Units Deployed as of the previous period divided by two. SaaS ARPU is used to evaluate the effectiveness of our SaaS pricing and assess our ability to market and sell our various software solutions. For the trailing twelve months ended September 30, 2026 and 2025, SaaS ARPU was $5.75 and $5.63, respectively.

Previous wording

We define Units Booked SaaS ARPU as the first year ARR for binding orders with Units Booked executed during the stated measurement period divided by the total Units Booked in the same period divided by the number of months in the period. Units Booked SaaS ARPU is used to evaluate the effectiveness of our SaaS pricing and assess our ability to market and sell our various software solutions for orders executed during the period. For the three months ended June 30, 2026 and 2025, Units Booked SaaS ARPU was $5.57 and $8.21, respectively. For the six months ended June 30, 2026 and 2025, Units Booked SaaS ARPU was $6.58 and $9.10, respectively. For the trailing twelve months ended June 30, 2026 and 2025, Units Booked SaaS ARPU was $7.09 and $9.08, respectively.

Current wording

We define Units Booked SaaS ARPU as the first year ARR for binding orders with Units Booked executed during the stated measurement period divided by the total Units Booked in the same period divided by the number of months in the period. Units Booked SaaS ARPU is used to evaluate the effectiveness of our SaaS pricing and assess our ability to market and sell our various software solutions for orders executed during the period. For the trailing twelve months ended September 30, 2026 and 2025, Units Booked SaaS ARPU was $7.09 and $8.66, respectively.

Previous wording

We define Customer Churn as cancelled deployed units during the measurement period divided by Units Deployed as of the beginning of the measurement period. Cancelled deployed units are the previous Units Deployed that have been cancelled during the same measurement period in which a customer cancels all product subscriptions. Our Hosted Services growth is driven by our ability to retain our customers and minimize Customer Churn. For the three months ended June 30, 2026 and 2025, our Customer Churn for our Smart Communities Solutions was 0.00% and 0.08%, respectively. For the six months ended June 30, 2026 and 2025, our Customer Churn for our Smart Communities Solutions was 0.05% and 0.10%, respectively.

Current wording

We define Customer Churn as cancelled Units Deployed during the measurement period divided by Units Deployed as of the beginning of the measurement period. Cancelled Units Deployed are the previous Units Deployed that have been cancelled during the same measurement period in which a customer cancels all product subscriptions. Our Hosted Services growth is driven, in part, by our ability to retain our customers and minimize Customer Churn. For the trailing twelve months ended September 30, 2026 and 2025, our Customer Churn for our Smart Communities Solutions was 0.09% and 0.15%, respectively.

Previous wording

We define Property Net Revenue Retention as SaaS Revenue at the end of the current period related to properties which had SaaS Revenue at the end of the same period in the prior year, divided by SaaS Revenue at the end of the same period in the prior year for those same properties. Property Net Revenue Retention includes additions to revenue from price increases on existing products, additions of new products at existing properties and transfers of ownership, offset by any reductions in revenue caused by cancellations or downgrades. Property Net Revenue Retention was 99% as of June 30, 2026 compared to 102% as of June 30, 2025.

Current wording

We define Property Net Revenue Retention as SaaS Revenue at the end of the current period related to properties which had SaaS Revenue at the end of the same period in the prior year, divided by SaaS Revenue at the end of the same period in the prior year for those same properties. Property Net Revenue Retention includes additions to revenue from price increases on existing products, additions of new products at existing properties and transfers of ownership, offset by any reductions in revenue caused by cancellations or downgrades. Property Net Revenue Retention was 93% as of September 30, 2026 compared to 104% as of September 30, 2025.

Previous wording

We define Customer Net Revenue Retention as SaaS Revenue at the end of the current period related to customers which had SaaS Revenue at the end of the same period in the prior year, divided by SaaS Revenue at the end of the same period in the prior year for those same customers. A customer with SaaS Revenue is defined as an entity that has an active subscription during the stated period. Customer Net Revenue Retention includes additions to revenue from transfers of ownership, price increases on existing products and additions of new products at existing properties, offset by any reductions in revenue caused by cancellations or downgrades. Customer Net Revenue Retention was 111% as of June 30, 2026 compared to 108% as of June 30, 2025.

Current wording

We define Customer Net Revenue Retention as SaaS Revenue at the end of the current period related to customers which had SaaS Revenue at the end of the same period in the prior year, divided by SaaS Revenue at the end of the same period in the prior year for those same customers. A customer with SaaS Revenue is defined as an entity that has an active subscription during the stated period. Customer Net Revenue Retention includes additions to revenue from transfers of ownership, price increases on existing products and additions of new products at existing properties, offset by any reductions in revenue caused by cancellations or downgrades. Customer Net Revenue Retention was 100% as of September 30, 2026 compared to 113% as of September 30, 2025.

Previous wording

(1) During the first quarter of 2026, we revised the presentation of the above table by aggregating Community WiFi revenue in Other as revenue from our Community WiFi solution is becoming less significant. The revised presentation has been applied retrospectively for the comparative periods ended June 30, 2025. For the three months ended June 30, 2026 and 2025, total revenue attributable to Community WiFi was $262 and $304, respectively. For the three months ended June 30, 2025, revenue attributable to Community WiFi was $54 related to Hardware, $41 related to Professional Services and $209 related to Hosted Services. For the six months ended June 30, 2026 and 2025, total revenue attributable to Community WiFi was $452 and $718, respectively. For the six months ended June 30, 2025, revenue attributable to Community WiFi was $57 related to Hardware, $259 related to Professional Services and $402 related to Hosted Services.

Current wording

(1) During the first quarter of 2026, we revised the presentation of the above table by aggregating Community WiFi revenue in Other as revenue from our Community WiFi solution is becoming less significant. The revised presentation has been applied retrospectively for the comparative periods ended September 30, 2025. For the three months ended September 30, 2026 and 2025, total revenue attributable to Community WiFi was $47 and $450, respectively. For the three months ended September 30, 2025, revenue attributable to Community WiFi was $94 related to Hardware, $164 related to Professional Services and $192 related to Hosted Services. For the nine months ended September 30, 2026 and 2025, total revenue attributable to Community WiFi was $499 and $1,168, respectively. For the nine months ended September 30, 2025, revenue attributable to Community WiFi was $151 related to Hardware, $423 related to Professional Services and $594 related to Hosted Services.

Previous wording

(2) For the three months ended June 30, 2026 and 2025, Hosted services revenue for our Smart Apartments solution included hub amortization revenue of $1,456 and $4,619, respectively. For the six months ended June 30, 2026 and 2025, Hosted services revenue for our Smart Apartments solution included hub amortization revenue of $3,506 and $9,277, respectively.

Current wording

(2) For the three months ended September 30, 2026 and 2025, Hosted services revenue for our Smart Communities Solutions included hub amortization revenue of $877 and $3,424, respectively. For the nine months ended September 30, 2026 and 2025, Hosted services revenue for our Smart Communities Solutions included hub amortization revenue of $4,383 and $12,701, respectively.

Previous wording

We generate hosted services revenue from (1) the direct sale to our customers of hosted services from subscription fees collected from customers to provide access to one or more of our software applications including access controls, asset monitoring, WiFi, and related services (“Hosted Services”) and (2) the amortization of non-distinct Hub Devices. These subscription arrangements have contractual terms ranging from one month to ten years and include recurring fixed plan subscription fees. The weighted average length of our recurring revenue contracts is 3.9 years. Our arrangements do not provide the customer with the right to take possession of our software at any time. Customers are granted continuous access to the services over the contractual period. Accordingly, fees collected for subscription services are recognized on a straight-line basis over the contract term beginning on the date the subscription service is made available to the customer.

Current wording

We generate hosted services revenue from (1) the direct sale to our customers of hosted services from subscription fees collected from customers to provide access to one or more of our software applications including access controls, asset monitoring and related services (“Hosted Services”) and (2) the amortization of non-distinct Hub Devices. These subscription arrangements have contractual terms ranging from one month to ten years and include recurring fixed plan subscription fees. The weighted average length of our recurring revenue contracts is 3.8 years. Our arrangements do not provide the customer with the right to take possession of our software at any time. Customers are granted continuous access to the services over the contractual period. Accordingly, fees collected for subscription services are recognized on a straight-line basis over the contract term beginning on the date the subscription service is made available to the customer.

Previous wording

Cost of revenue consists primarily of direct costs of products and services together with the indirect cost of estimated warranty expense and customer care and support over the life of the service arrangement. We expect the cost of revenue to increase in absolute dollars in future periods commensurate with increases in revenue. We record any change to cost of job performance and job conditions in the period during which the revision is identified.

Current wording

Cost of revenue consists primarily of direct costs of products and services together with the indirect cost of estimated warranty expense and customer care and support over the life of the service arrangement. We expect the cost of revenue to increase in absolute dollars in future periods commensurate with increases in the volume of our business. We record any change to cost of job performance and job conditions in the period during which the revision is identified.

Previous wording

Cost of hardware revenue consists primarily of direct costs of products, Hub Devices, hardware devices and supplies purchased from third-party providers, shipping costs, warehouse facility (including depreciation and amortization of capitalized assets and right-of-use assets) and infrastructure costs, personnel-related costs associated with the procurement and distribution of our products and estimated warranty expenses together with the indirect cost of customer care and support. We expect an increase in cost of hardware revenue in absolute dollars in future periods commensurate with increases in revenue.

Current wording

Cost of hardware revenue consists primarily of direct costs of products, Hub Devices, hardware devices and supplies purchased from third-party providers, shipping costs, warehouse facility (including depreciation and amortization of capitalized assets and right-of-use assets) and infrastructure costs, personnel-related costs associated with the procurement and distribution of our products and estimated warranty expenses together with the indirect cost of customer care and support. We expect an increase in cost of hardware revenue in absolute dollars in future periods commensurate with increases in the volume of our business. Hardware revenue margins may vary in future periods due to a number of factors including changes to the cost of the goods and services detailed above, changes to the product mix and tariffs.

Previous wording

Tariffs imposed by the U.S. government since 2019, especially with respect to China, have subjected certain SmartRent products manufactured overseas to additional import duties. The amount of the import tariff has changed numerous times based on actions by the U.S. government. The U.S. government has implemented and threatened further increases to tariffs in 2025 on imports from countries such as Canada, Mexico and China. Such actions may increase our cost of hardware revenue and reduce our hardware revenue margins in the future. We continue to monitor and evaluate changes in policy impacting global trade, including tariff regulations.

Current wording

Tariffs imposed by the U.S. government have subjected certain SmartRent products manufactured overseas to volatility of import duties. The amount of the import tariff has changed numerous times based on various geopolitical factors including actions by the U.S. government. Future changes in trade policy may increase our cost of hardware revenue and reduce our hardware revenue margins. We continue to monitor and evaluate changes in policy impacting global trade, including tariff regulations.

Previous wording

Cost of professional services revenue consists primarily of direct costs related to personnel-related expenses for installation and supervision of installation services, general contractor expenses and travel expenses associated with installation of our products, and indirect costs that are also primarily personnel-related expenses in connection with training of and ongoing support for customers and residents.

Current wording

Cost of professional services revenue consists primarily of direct costs related to personnel-related expenses for installation and supervision of installation services, general contractor expenses and travel expenses associated with installation of our products, and indirect costs that are also primarily personnel-related expenses in connection with training of and ongoing support for customers and residents. We expect an increase in cost of professional services revenue in absolute dollars in future periods commensurate with increases in the volume of our business. Professional services revenue margins may vary in future periods due to a number of factors including changes to the cost of the services detailed above and changes to the product mix.

Previous wording

Research and development expenses consist primarily of personnel-related costs directly associated with our research and development activities. Our research and development efforts are focused on enhancing and developing additional functionality for our existing products and on new product development. We account for the cost of research and development by capitalizing qualifying costs, which are incurred during the product development stage, and amortizing those costs over the product’s estimated useful life, which generally ranges from three to five years depending on the type of application. Costs incurred and capitalized during the product development stage generally include the costs of software configuration, coding, and testing. Such costs primarily include payroll and payroll-related expenses for employees directly involved in the product development. We expense preliminary evaluation costs as they are incurred before technological feasibility is achieved, as well as post development implementation and operation costs, such as training, maintenance and minor upgrades. We begin amortizing capitalized costs when a project is ready for its intended use, and we periodically reassess the estimated useful life of a project considering the effects of obsolescence, technology, competition and other economic factors which may result in a shorter remaining life. We believe our research and development costs will increase in absolute dollars as we increase our investment in product development to broaden the capabilities of our solutions and introduce new products and features.

Current wording

Research and development expenses consist primarily of personnel-related costs directly associated with our research and development activities. Our research and development efforts are focused on enhancing and developing additional functionality and security for our existing products and on new product development. We account for the cost of research and development by capitalizing qualifying costs, which are incurred during the product development stage, and amortizing those costs over the product’s estimated useful life, which generally ranges from three to five years depending on the type of application. Costs incurred and capitalized during the product development stage generally include the costs of software configuration, coding, and testing. Such costs primarily include payroll and payroll-related expenses for employees directly involved in the product development. We expense preliminary evaluation costs as they are incurred before technological feasibility is achieved, as well as post development implementation and operation costs, such as training, maintenance and minor upgrades. We begin amortizing capitalized costs when a project is ready for its intended use, and we periodically reassess the estimated useful life of a project considering the effects of obsolescence, technology, competition and other economic factors which may result in a shorter remaining life. We believe our research and development costs will increase in absolute dollars as we increase our investment in product development to broaden the capabilities of our solutions and introduce new products and features.

Previous wording

Other income/expenses consist primarily of interest income, net of interest expense, foreign currency transaction gains and losses, and other income related to the operations of foreign subsidiaries. Interest expense is recorded in connection with our various debt facilities. Foreign currency transaction gains and losses relate to the impact of transactions denominated in a foreign currency other than the U.S. dollar. If we continue to expand our international operations, our exposure to fluctuations in foreign currencies has increased, which we expect to continue.

Current wording

Other income/expenses consist primarily of interest income, net of interest expense, foreign currency transaction gains and losses, and other income related to the operations of foreign subsidiaries. Interest expense is recorded in connection with our various debt facilities. Foreign currency transaction gains and losses relate to the impact of transactions denominated in a foreign currency other than the U.S. dollar. If we continue to expand our international operations, our exposure to fluctuations in foreign currencies will increase.

Previous wording

Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025

Current wording

Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025

Previous wording

Comparison of the three and six months ended June 30, 2026 and 2025

Current wording

Comparison of the three and nine months ended September 30, 2026 and 2025

Previous wording

Total revenue increased by $1.5 million, or 4%, to $39.8 million for the three months ended June 30, 2026, from $38.3 million for the three months ended June 30, 2025. The increase was primarily driven by a 59% increase in Professional Services ARPU to $580 for the three months ended June 30, 2026 from $365 for the three months ended June 30, 2025 primarily driven by an increase of $2.5 million related to the installation of hub upgrades. This was partially offset by a 12% decrease in Units Shipped to 23,249 for the three months ended June 30, 2026 from 26,543 for the three months ended June 30, 2025. Hosted Services revenue from hub amortization decreased by approximately $3.1 million and revenue from SaaS increased by $1.9 million from the three months ended June 30, 2025 to the three months ended June 30, 2026.

Current wording

Total revenue increased by $5.4 million, or 15%, to $41.6 million for the three months ended September 30, 2026, from $36.2 million for the three months ended September 30, 2025. The increase was primarily driven by a 53% increase in Units Shipped to 30,705 for the three months ended September 30, 2026 from 20,047 for the three months ended September 30, 2025. Hosted Services revenue from hub amortization decreased by approximately $2.6 million and revenue from SaaS increased by $1.5 million from the three months ended September 30, 2025 to the three months ended September 30, 2026.

Previous wording

Professional services revenue increased by approximately $6.5 million, or 78%, to $14.7 million for the six months ended June 30, 2026, from $8.2 million for the six months ended June 30, 2025. The increase in professional services revenue was primarily driven by a 21% increase in Professional Services ARPU to $475 for the six months ended June 30, 2026 from $392 for the six months ended June 30, 2025 primarily due to an increase of $3.0 million related to the installation of hub upgrades and $1.1 million related to the installation of access control solutions.

Current wording

Professional services revenue increased by approximately $5.8 million, or 39%, to $21.1 million for the nine months ended September 30, 2026, from $15.3 million for the nine months ended September 30, 2025. The increase in professional services revenue was primarily driven by an 18% increase in Professional Services ARPU to $490 for the nine months ended September 30, 2026 from $416 for the nine months ended September 30, 2025 largely due to an increase of $2.9 million related to the installation of hub upgrades and $2.0 million related to the installation of access control solutions.

Previous wording

Hosted Services revenue decreased by approximately $1.2 million, or 7%, to $17.6 million for the three months ended June 30, 2026, from $18.8 million for the three months ended June 30, 2025. Of the $17.6 million revenue in 2026, $16.1 million is related to SaaS Revenue and $1.5 million is related to hub amortization. Revenue from hub amortization decreased by $3.1 million and revenue from SaaS increased by $1.9 million, or 13%, from the three months ended June 30, 2025 to the three months ended June 30, 2026. The increase of SaaS revenue resulted primarily from a 10% increase in the aggregate number of Units Deployed from 847,956 units at June 30, 2025 to 929,487 units at June 30, 2026.

Current wording

Hosted Services revenue decreased by approximately $1.1 million, or 6%, to $16.6 million for the three months ended September 30, 2026, from $17.7 million for the three months ended September 30, 2025. Of the $16.6 million revenue in 2026, $15.7 million is related to SaaS Revenue and $0.9 million is related to hub amortization. Revenue from hub amortization decreased by $2.6 million and revenue from SaaS increased by $1.5 million, or 11%, from the three months ended September 30, 2025 to the three months ended September 30, 2026. The increase of SaaS Revenue resulted primarily from an 8% increase in the aggregate number of Units Deployed from 870,230 units at September 30, 2025 to 941,977 units at September 30, 2026.

Previous wording

Hosted Services revenue decreased by $2.6 million, or 7%, to $34.9 million for the six months ended June 30, 2026, from $37.5 million for the six months ended June 30, 2025. Of the $34.9 million revenue in 2026, $31.3 million is related to SaaS Revenue and $3.6 million is related to hub amortization. Revenue from hub amortization decreased by approximately $5.7 million and revenue from SaaS increased by $3.1 million, or 11%, from the six months ended June 30, 2025 to the six months ended June 30, 2026. The increase of SaaS revenue resulted primarily from a 10% increase in the aggregate number of Units Deployed from 847,956 units at June 30, 2025 to 929,487 units at June 30, 2026.

Current wording

Hosted Services revenue decreased by approximately $3.6 million, or 7%, to $51.5 million for the nine months ended September 30, 2026, from $55.1 million for the nine months ended September 30, 2025. Of the $51.5 million revenue in 2026, $47.1 million is related to SaaS Revenue and $4.4 million is related to hub amortization. Revenue from hub amortization decreased by approximately $8.3 million and revenue from SaaS increased by $4.7 million, or 11%, from the nine months ended September 30, 2025 to the nine months ended September 30, 2026. The increase of SaaS Revenue resulted primarily from an 8% increase in the aggregate number of Units Deployed from 870,230 units at September 30, 2025 to 941,977 units at September 30, 2026.

Previous wording

We don’t expect to deploy any more non-distinct Hub Devices, thus, the revenue contribution from hub amortization should continue to decrease in future periods until the non-distinct Hub Devices are fully amortized. As noted above, revenue from hub amortization decreased by approximately $5.7 million from the six months ended June 30, 2025 to the six months ended June 30, 2026. During the remainder of 2026, hub amortization is expected to further decrease by $4.8 million compared to the same periods in 2025. The table below shows the expected revenue contribution from hub amortization.

Current wording

We do not expect to deploy any more non-distinct Hub Devices, thus, the revenue contribution from hub amortization should continue to decrease in future periods until the non-distinct Hub Devices are fully amortized. As noted above, revenue from hub amortization decreased by approximately $8.3 million from the nine months ended September 30, 2025 to the nine months ended September 30, 2026. During the remainder of 2026, hub amortization is expected to further decrease by $2.3 million compared to the same periods in 2025. The table below shows the expected revenue contribution from hub amortization.

Previous wording

Hardware cost of revenue decreased by $1.0 million, or 7%, to $11.9 million for the three months ended June 30, 2026, from $12.9 million for the three months ended June 30, 2025. This decrease in hardware cost of revenue was primarily attributable to a 12% decrease in Units Shipped.

Current wording

Hardware cost of revenue decreased by approximately $2.6 million, or 6%, to $38.1 million for the nine months ended September 30, 2026, from $40.7 million for the nine months ended September 30, 2025. This decrease in hardware cost of revenue was primarily attributable to a $2.9 million decrease in inventory obsolescence.

Previous wording

Professional services cost of revenue increased by $0.7 million, or 10%, to $6.9 million for the three months ended June 30, 2026, from $6.2 million for the three months ended June 30, 2025. Importantly, this 10% increase in professional services cost of revenue was significantly lower than the 100% increase in professional services revenue. The increase in professional services cost of revenue is primarily attributable to a $2.1 million increase in third-party direct labor costs, partially offset by a decrease of $1.2 million in fixed, personnel-related costs resulting from actions executed in the second half of 2025.

Current wording

Professional services cost of revenue decreased by $0.5 million, or 8%, to $6.3 million for the three months ended September 30, 2026, from $6.8 million for the three months ended September 30, 2025. The decrease is primarily attributable to a decrease of $0.5 million in fixed, personnel-related costs resulting from actions executed in the second half of 2025.

Previous wording

Professional services cost of revenue decreased by $0.7 million, or 6%, to $12.8 million for the six months ended June 30, 2026, from $13.5 million for the six months ended June 30, 2025. The decrease in professional services cost of revenue is primarily attributable to a decrease of $2.6 million in fixed, personnel-related costs resulting from actions executed in the second half of 2025, partially offset by an increase of $2.3 million in third-party direct labor costs.

Current wording

Professional services cost of revenue decreased by $1.3 million, or 6%, to $19.0 million for the nine months ended September 30, 2026, from $20.3 million for the nine months ended September 30, 2025. The decrease in professional services cost of revenue is primarily attributable to a decrease of $3.1 million in fixed, personnel-related costs resulting from actions executed in the second half of 2025, partially offset by an increase of $2.4 million in third-party direct labor costs.