Oura (Ring) Paused Its IPO

Background: Oura is a personal health device that sells for over $300. Owners also pay for a membership ($5.99/month or $69.99/year) to get the full experience. Oura filed to go public on September 3rd, then postponed on September 29th, citing market uncertainty. They were targeting a valuation of roughly $15B. Filings show that revenue more than doubled in fiscal 2025 to about $908M, and it reached $1.2B in just the first nine months of fiscal 2026. They sold 3.1M rings in those nine months. Hardware accounts for 80% of their revenue. The higher-margin membership revenue looks strong (89% gross margin, up 121% year over year). Their balance sheet looks less robust after they spent more than $1B buying back shares from early investors, partly funded by a $375M draw on a bank facility.

Context: I was a very early owner of an Oura Ring, and I am cheering for them. I'm sure the data they've collected is valuable. Historically, we've seen many app and device exits based solely on the value of the data. I hope that isn't their end.

Based on my wearables research over the past 10+ years, I'll share three perspectives:

1. Hardware is a tough business. Ask Alphabet, Amazon, and Microsoft. You need inventory, distribution, the ability to accept returns, and more. It's expensive. With smartphones, companies can differentiate on screen size, pixels, cameras, and more. Rings are tougher.

2. Smartwatches offer far more utility at a similar price point. Smartwatches detect AFib and falls. They make phone calls and save lives. Apple, Google, and Samsung can extend many of their services to their wearables to create mini network effects. While I don't have data, I suspect rings are often an "and" rather than an "or" for a smartwatch, given that Oura has 2% (self-reported) of the global wearables market.

3. Behavior change is hard. Only a fraction of people work out regularly. Many adopt wearables with a health goal in mind (e.g., weight loss). Many fitness wearables started out as pedometers, i.e., measuring steps and getting people to move. They developed sophisticated tactics (e.g., measurement, gamification, competitions, nudges) to help people achieve their goals. If the goal is weight loss, GLP-1s are a path with less friction, and insurance often subsidizes them. Smartwatches, along with the Oura Ring and similar devices, have moved well beyond that functionality. They offer insights on body temperature, sleep quality, ovulation cycles, heart health, and more. The data is more sophisticated than most people can comprehend or use to make decisions.