Smart home technology company Alarm.com reported their highly anticipated financial results for the second quarter ended June 30, 2015. Above most analyst estimates, total revenue increased by 23% to $51.9 million for the second quarter of 2015 compared to $42.1 million for the second quarter of 2014.

"We maintained solid revenue growth and profitability in our first reporting period as a public company", said Steve Trundle, Alarm.com’s president and CEO. "At the same time, we continued to invest in our core technology to enhance our connected home platform and to expand our footprint in international markets, and we anticipate continuing to step up our investments in the coming quarters while also continuing to produce positive cash flow from operations".

Alarm.com’s services are built around home security and also include home automation devices like lights, locks, and smart thermostats. With no shortage of smart thermostats on the market today, it was expected that the software focused firm would seek to integrate with an established product. Instead Alarm.com opted to develop it’s own thermostat with radio modules that integrate into other devices to work with its wider platform.

“We really asked, ‘How do we take smart-home-as-a-service and integrate a device that can take advantage of the rest of the platform?’” said Jay Kenny, senior VP of marketing with Alarm.com.

While most smart thermostats utilise Wi-Fi, Alarm.com’s device operates using cellular communication. Integration with smart thermostats on its platform uses Z-Wave in order to provide a more seamless experience, however this limits the number of thermostats that are available to the firm’s customers.

The firm also focused on putting the intelligence into the cloud (and not the device) to keep the price relatively low. It sells to dealers for $149, substantially lower than similar offerings from Ecobee and Nest, which cost about $250. “As we move beyond security, we felt we have a better experience if [the thermostat] is integrated across a home”, said Kenny.

The strategy places Alarm.com in direct competition with Google’s smart home acquisition, Nest. Nest products, such as the smoke alarm, are all connected to the thermostat, Alarm.com’s thermostat can also connect to a smoke detector and automatically shut off the HVAC system so that smoke is not recirculated through the home.

Ecobee have also been offering additional sensors to accompany the thermostat in order to provide greater precision in heating and cooling. Again Alarm.com’s thermostat will also offer additional temperature sensors that can be placed anywhere in the home to get a more accurate read of temperatures across the home.

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The smart thermostat market is heating up and providing consumers with unprecedented options. Analysts, Parks Associates, expect smart thermostats will start to make up the majority of all thermostat sales in the U.S. by the end of 2015.

"The Smart home, and the Internet of Things more broadly, has emerged as one of the most promising categories in consumer technology. We believe consumers prefer to acquire smart home technologies through the security channel because of the professional installation, support and home monitoring services they deliver. In partnership with thousands of trusted service providers who offer Alarm.com to their customers, we are at the forefront of empowering consumers with the security, efficiency, awareness and convenience of the connected home" explained Alarm.com CEO, Steve Trundle.

The company already has more than 5,000 dealers but is looking to include additional HVAC service providers and utilities to the network. Their strategy of diversification has already lead them to the acquisition of demand-response platform provider EnergyHub, and their anticipated total revenue for 2015 is expected to be approximately $193.9 million to $195.3 million.