SPA's first new kids smartwatch in four years to launch this month

This week our family and child safety tech Investment Spacetalk (ASX: SPA) confirmed its new Geo kids smartwatch will launch in Australia this month.

Geo is SPA's first new watch model in four years.

It will be hitting shelves in time for the busy holiday and “Back to School” trading period.

(source)

SPA sells Australia's #1 best-selling kids smartwatch, a phone alternative that blocks social media and the open internet.

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.

(source)

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

(source)

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

(source)

The watches are the customer entry point for SPA to gain recurring revenues which may be helped by the global macro tailwind in this space.

SPA is aiming to get ARR (Annual Recurring Revenue) through Spacetalk Mobile (its own mobile plans) and subscriptions to its family safety app.

SPA is doing ~$9.7M in ARR (according to the most recent quarterly), now it has new hardware incoming to the market which should hopefully kick along the all important ARR metric.

We Invested in SPA to see it distribute its family safety app through telcos globally.

The first step we saw in action on this front was the binding agreement to offer the app to Vodafone Australia's ~2.8M postpaid customers (Vodafone is owned by ~$7.9BN TPG Telecom).

That app rollout through Vodafone’s network is still to come.

See our most recent Deep Dive on that here: SPA: Vodafone Australia to offer SPA family safety app to its millions of customers...

Yesterday’s announcement is about the start of that customer funnel - the watches themselves.

Here’s the key takeaways:

1. Two more watch models are planned for March - April 2027, directly replacing the current existing Adventurer 2 and Loop devices.
2. The new range is cheaper to manufacture. SPA expects device gross margins to improve by 10 percentage points or more, and by up to 20 percentage points for Geo versus the outgoing Adventurer 2 model.
3. The new watches are expected to start contributing to revenues in Q2 FY27 - subject to final testing, supply and retail readiness.

Every watch sold is a low cost way to bring a household onto an SPA mobile plan or app subscription.

We also saw this interview CEO & MD Simon Crowther did earlier in the week updating on what is happening:

Spacetalk (ASX:SPA): Launching its family safety app, with a co-branded offer for Vodafone customers

Also this week, SPA confirmed a board restructure, with two members stepping down post the upcoming annual general meeting.

The SPA board and management has decided that there won’t be any replacements to the board, with current Non-Executive Director Andrew Grover to take up the Chair role.

This decision was made in respect to “the company’s current scale and stage of development”, (source)

We know Andrew well, he is the Executive Chair of another of our Investments EIQ and at the time of adding SPA to the portfolio, had just seen EIQ sign an agreement with Pro Medicus that saw its market cap go over $1BN.

The market cap has since retreated to circa $360M.

Grover was part of the reason we first Invested in SPA - having seen him at work at EIQ, we are backing him to do it again at SPA, which we covered in our initiation note.

Grover joined SPA in April and he has also invested $492k of his own cash into the company, so we would like to see him take SPA on a similar trajectory to EIQ from here.

We like it when directors have had past success and have ‘skin in the game’ in the company boards they sit on.

A quick refresher on what SPA does

SPA sells Australia's #1 best-selling kids smartwatch, a phone alternative that blocks social media and the open internet.

(you can buy one here or at your favourite electronics retailer)

Around the watches, SPA has built recurring revenue streams - Spacetalk Mobile (its own mobile plans) and a family safety app launched in November 2025.

SPA reported ~$9.7M in ARR (annual recurring revenue) in the recent quarter, so with additional hardware (watches) and software users (especially from telco deals) we think this can grow.

The plan is to distribute the app through telcos globally, with Vodafone the first sign SPA is able to achieve this plan.

Read our Initiation note on SPA here: SPA: Vodafone Australia to offer SPA family safety app to its millions of customers

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