SPA signs sales agreements for smartwatches in the UK and Germany

Our Investment Spacetalk (ASX: SPA) just signed sales agreements to take its kids smartwatches into the UK and Germany.

SPA sells Australia's #1 best-selling kids smartwatch across Australia and New Zealand (soon to be across a ~919 store network):

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After yesterday’s news, SPA will have local sales partners (TIOGO in the UK and VALOQ in Germany) distributing the smartwatches into the two new markets.

According to SPA’s announcement across the two they are targeting over A$1.6M in hardware sales to SPA in the first 12 months.

(the targets are non-binding, so there are no minimum purchase commitments or guaranteed revenue)

Both agreements start immediately and cover SPA's entire current and future watch range, including the new models SPA announced last week.

We Invested in SPA not just for its watch business - but because we liked its family safety software pivot.

We think that SPA can use its market leading position in watches to launch and distribute its family safety app (and mobile plans).

And eventually scaly the software side of the business to one day outgrow the hardware - a similar strategy to $5BN capped Life360. (see our Life360 analogy here)

Any mobile plan and app subscription revenue from these new households would be on top of the hardware sales.

The hardware sales compliment the software side of the business because it acts as a customer acquisition funnel.

Each watch sold is a chance to bring not just an individual, but an entire household into SPA's app and its recurring revenue.

CEO & MD Siomn Crowther went through this in an interview we saw here:

Spacetalk (ASX:SPA): Expanding margins with a new kids smartwatch in time for Christmas

We think SPA’s macro theme is looking strong too

We think SPA has (with a bit of luck) found itself in the middle of a macro thematic that is actually really hard to get exposure to.

That is the filtering of the internet for kids.

Australia's under-16 social media ban has been in force since December 2025.

Just two weeks ago the Communications Minister confirmed the eSafety Commissioner is building a Federal Court case against Meta, TikTok, Snap and YouTube for not doing enough to keep kids off their platforms.

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This type of policy is gaining momentum worldwide with countries all over the world bringing in their own similar legislation (or has it proposed):

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Plus in the US, Florida and Georgia (source) were cleared last month to start enforcing their under-16 laws:

(source)

SPA is able to help with this problem through its software:

(source)

As for the watches, they are the customer acquisition funnel.

What we want to see next from SPA

Rollout SPA’s app to Vodafone customers

SPA has now converted the MoU into a binding commercial deal - next we want to see the app go live and turn into revenues for SPA.

Milestones:

1. ✅ Binding commercial agreement signed
2. 🔄 App made available to Vodafone post-paid customers
3. 🔲 First revenue recognised from the partnership

Expand telco distribution internationally

We want to see SPA prove Vodafone wasn't a one-off and open up adjacent markets.

Here are the milestones we are tracking:

1. 🔲 Spacetalk Mobile live in Sweden & Germany (early Q1 FY27)
2. 🔲 A second (ideally international) telco partner signed

Grow recurring revenue to the $20–25M ARR target

This one is more of an overarching goal - we want to see SPA hit its $20-25M ARR target.

Here are the milestones we are tracking for this:

1. 🔄 Active mobile subscriber growth (currently 57.9k users)
2. 🔄 Grow monthly active app users
3. 🔄 Grow Annual Recurring Revenues to $20-25M