Ituran's Q4 2024: Unpacking Contradictions on Subscription Growth, OEM Impact, and ARPU Trends

These are the key contradictions discussed in Ituran Location and Control's latest 2024Q4 earnings call, specifically including: Subscription Revenue Growth and ARPU Impact, OEM Partnerships and Revenue Contribution, Product Sales Growth Rate Expectations, and ARPU Decline Explanations:



Revenue and Subscriber Growth:
- Ituran reported revenue of $82.9 million for Q4 2024, a 7% increase compared to the previous year, while local currency revenues grew by 11% year-over-year.
- The growth was driven by ongoing and growing demand for location-based products, telematics services, and new initiatives like motorcycle solutions and usage-based insurance (UBI) services.

Subscriber Additions and Outlook:
- The company achieved 40,000 net subscriber adds in the quarter, at the top end of expectations.
- For 2025, Ituran anticipates subscriber adds to accelerate to between 180,000 and 200,000, reflecting a 20% increase from the 2024 rate.
- This growth is expected due to new service offerings, expanding the total addressable market, and partnerships with OEMs.

OEM Relationships and Expansion:
- Ituran continues to strengthen ties with major OEMs like Nissan and Daimler, expecting to sell tens of thousands of connected devices annually.
- The company is actively exploring new OEM partnerships and expanding services to additional South American countries.
- The strategic focus on OEMs is aimed at driving long-term growth potential.