ALRM - Alarm.com stock slips 3% after the bell on licensing dispute with Vivint

Alarm.com ( NASDAQ: ALRM ) stock slipped 3.4% after the bell on Thursday as the firm provided an update regarding a licensing dispute with Vivint ( VVNT ), which is expected to impact quarterly earnings starting from Q4.

Vivint ( VVNT ) informed Alarm.com ( ALRM ) that it will stop paying license fees under the patent cross license deal between the two firms.

Vivint ( VVNT ) paid the required licensing fees to Alarm.com ( ALRM ) since the deal was executed in 2013.

Alarm.com ( ALRM ) disputes Vivint's ( VVNT ) refusal of payment. The firm filed for arbitration and is evaluating additional legal remedies.

Starting with Q4, Alarm.com ( ALRM ) believes quarterly SaaS and license revenue and total revenue will be impacted by ~$6M, or 2.8% of total revenue in Q4.

The company believes quarterly earnings and cash flow will be impacted as well.

Alarm.com ( ALRM ) also forecast Q3 total revenue of $215M-$215.5M, topping consensus estimate of $209.81M.

Q3 SaaS and license revenue is projected to be $132.8M-$133M vs. Alarm.com's ( ALRM ) prior outlook of $130.9M-$131.1M.

Q3 hardware revenue is expected to be $82M-$82.5M.

Alarm.com ( ALRM ) will report final Q3 results after market close on Nov. 8.

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