Strong financial results and cash generation
Revenue up 4%; GAAP EPS up 18% and Adjusted EPS up 4%
Year-to-date GAAP Operating Cash Flows up 16%, Adjusted Free Cash Flow (including swaps) up 46%
Returned $748 million to shareholders year-to-date through share repurchases and dividends
ADT today reported results for the third quarter of 2026. Financial highlights for the third quarter are set forth below with variances on a year-over-year basis unless otherwise noted.
Third quarter 2026
- Total revenue increased 4% to $1.3 billion
- Solid core operating metrics with end-of-period recurring monthly revenue (RMR) of $360 million, gross revenue attrition of 13.1%, and revenue payback at 2.3 years
- GAAP income from continuing operations of $153 million, or $0.20 per diluted share, up $9 million
- Adjusted income from continuing operations of $176 million, or $0.24 per diluted share, down $11 million
- Net cash provided by operating activities of $440 million, down $40 million; Adjusted Free Cash Flow (including interest rate swaps) of $217 million, up $8 million
"ADT delivered solid third quarter results, with revenue growth, strong year-to-date cash generation and stable core operating metrics, reflecting the durability of our business and the dedication of our more than 12,000 employees," said Jim DeVries, ADT Chairman, President and CEO. “We are making meaningful progress in transforming ADT into a more intelligent and connected platform through investments in AI, next-generation sensing technologies, and expanded digital and retail distribution. As we look ahead to our next chapter, our focus remains on serving our customers and providing peace of mind."
Pending acquisition by Thrive Holdings
On Oct. 29, 2026, ADT announced that it has entered into a definitive agreement to be acquired by Thrive Holdings in an all-cash transaction. Under the terms of the agreement, which ADT's Board of Directors unanimously approved, stockholders will receive $10.00 per share in cash upon completion. The transaction is expected to close in the first quarter of 2027, subject to customary closing conditions, including approval by stockholders and receipt of U.S. antitrust approval. Until the transaction closes, ADT will continue to operate independently as a public company. Following completion, ADT will become privately held, and its common stock will cease trading on the New York Stock Exchange. In consideration of the pending transaction, the company is not providing financial guidance and is withdrawing previously issued guidance.
Business highlights
Innovative Offerings, Unrivaled Safety and Premium Experience
ADT is undertaking focused initiatives to drive growth, strengthen brand loyalty, and improve customer acquisition efficiency while advancing its core mission of providing peace of mind. Recent progress on these initiatives is described below.
- Expanding intelligent home innovation: Introduced Unusual Activity Alerts in ADT+, leveraging connected device and sensor data to identify meaningful changes in household activity and provide proactive customer notifications.
- Progressing next-generation presence sensing: Advanced Origin AI-powered presence sensing capabilities, including ADT+ integration, development of future security and aging in place use cases, and commercialization planning for 2027 launch.
- Scaling AI across customer experience: Continued expanding AI-enabled sales and service capabilities including intelligent call routing, AI-driven inbound and outbound sales and service pilots, and more advanced transcription and agent assist capabilities to handle increasingly complex customer interactions.
- Broadening customer choice and market reach: Expanded ADT Blu to Walmart.com, increasing nationwide consumer access to ADT’s DIY security offering and broadening offerings across more customer segments and distribution channels.
- Advancing ADT+ platform across channels: Continued the phased rollout of ADT+ for dealer-generated new customer additions, extending the company’s technology platform and supporting a more consistent customer experience across channels.
- Extending professional installation reach: Launched ADT Partner Services, a new offering that brings ADT’s trusted brand, field expertise and national reach to more companies and customers. Through this offering, ADT will install and service select products for Apple Retail and its customers in the U.S. beginning this fall.
- Strengthening community engagement impact and first responder partnerships: Expanded ADT’s signature ADT Life Saver program with a community event in Houston and continued to support National Night Out celebrations across the country, reinforcing ADT’s commitment to safer communities.
Unlocking Shareholder Value
ADT remained focused on continuing to generate significant cash flow, enabling direct capital returns to shareholders while maintaining a healthy balance sheet.
- Share repurchases: During the third quarter, ADT repurchased and retired 3 million shares of its common stock for an aggregate price of $23 million. Year to date, the company has repurchased and retired 89 million shares of its common stock for an aggregate price of $617 million.
- Enhancing financial flexibility: In August, ADT secured $100 million of incremental borrowings under the First Lien Term Loan A due 2030, further strengthening the company’s financial flexibility.
- Strategic bulk account purchase: ADT completed a bulk purchase of approximately 8,000 customer accounts for $9 million cash.
Results of operations
Total revenue was $1,349 million for the third quarter, up 4%. The increase was primarily driven by higher security installation, product and other revenue due to an increase in the mix of professionally installed systems under the outright sales model. The decrease in Monitoring and related services (M&S) revenue reflects lower sales volume including the revenue loss from the October 2025 divestiture of the multifamily business, partially offset by higher average prices.
Income from continuing operations was $153 million, or $0.20 per diluted share, for the third quarter, up $9 million. This was driven by higher revenue, net of related costs, partially offset by higher selling, general, and administrative expenses, including the impact of the prior year goodwill impairment related to the divestiture of the multifamily business. Income from continuing operations also benefited from lower interest, including the impact of interest rate swaps.
Adjusted income from continuing operations was $176 million, or $0.24 per diluted share, for the third quarter, down $11 million, driven primarily by the same factors noted above excluding the prior year goodwill impairment and impact of interest rate swaps.
In addition to the factors above, earnings per share metrics benefited from a lower weighted-average diluted share count as a result of share repurchases.
Balance sheet and cash flow
For the third quarter, net cash provided by operating activities was $440 million, down $40 million, primarily reflecting higher net subscriber acquisition spend related to outright sales transactions, higher general and administrative expenses, and lower M&S margins, partially offset by lower cash taxes and favorable working capital timing. Adjusted Free Cash Flow (including interest rate swaps) was $217 million, up $8 million. This measure includes the same factors above excluding the subscriber acquisition impact from the transition to an outright sales model.
In August, the company secured $100 million of incremental borrowings under its First Lien Term Loan A due 2030, further enhancing financial flexibility and supporting general corporate purposes, which may include the repayment of a portion of the company’s 2027 notes.
Total cash and cash equivalents as of Sept. 30, 2026 were $228 million and no amounts were outstanding under the company’s First Lien Revolving Credit Facility.
ADT returned $64 million of capital to shareholders during the quarter, including $23 million of share repurchases and $41 million of dividend payments. Through the end of the third quarter, the company has repurchased 89 million shares returning $748 million to shareholders through share repurchases and dividends.
Conference call
As previously announced, management will host a conference call at 10 a.m. ET today to discuss the company’s third quarter 2026 results. In consideration of the proposed acquisition of ADT by Thrive Holdings announced on Oct. 29, 2026, the company will not be taking questions on the call. Participants may listen to a live webcast through the Investor Relations website. Alternatively, participants may listen to the live call by dialing 1-833-461-5787 (toll-free) or 1-585-542-9983 and providing the access code 472959920. A replay of the webcast will be available on the website within 24 hours after the event.
A slide presentation highlighting the company’s results will also be available on the Investor Relations website. From time to time, the company may use its website as a channel of distribution of material company information. Financial and other material information regarding the company is routinely posted on and accessible on the Investor Relations website.
Media Contacts
About ADT
ADT is a leading provider of security, interactive, and smart home solutions serving residential and small business customers in the U.S. Through innovative offerings, unrivaled safety, and a premium customer experience delivered by the largest network of smart home security professionals in the U.S., ADT empowers people to protect and connect to what matters most, every second, every day. For more information, visit www.adt.com.
Forward-looking statements
ADT has made statements in this press release that are forward-looking and therefore subject to risks and uncertainties, including those described below. All statements, other than statements of historical fact, included in this document are, or could be, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) and are made in reliance on the safe harbor protections provided thereunder. These forward-looking statements relate to, among other things, the Company’s capital allocation priorities and commitments; the Company’s partnership programs and the bulk purchase of customer accounts; initiatives with respect to the Company’s products and services, including ADT+, ADT Blu, Origin AI’s presence sensing technology, and the expected benefits and capabilities of such products and services; the Company’s ability to successfully execute and scale its DIY offerings, including through the expansion of its retail and e-commerce distribution channels; the Company’s development, deployment, and integration of AI in its products, services, and operations, including AI-driven customer interactions, virtual agents, operational efficiencies, and home intelligence capabilities; and the expectations, plans and objectives of management; any stated or implied outcomes with regard to the foregoing; and other matters. Without limiting the generality of the preceding sentences, any time we use the words “ongoing,” “expects,” “intends,” “will,” “anticipates,” “believes,” “confident,” “possible,” “continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “potential,” “outlook,” “goals,” “objectives,” “targets,” “planned,” “projects,” and, in each case, their negative or other various or comparable terminology, and similar expressions, we intend to clearly express that the information deals with possible future events and is forward-looking in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. These forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to management. We caution that these statements are subject to risks and uncertainties, many of which are outside of the Company’s control and could cause future events or results to be materially different from those stated or implied in this press release, including, among others, the risk that the proposed transaction with Thrive Holdings announced on October 29, 2026 (the “Proposed Merger”) may not be completed in a timely manner or at all; the failure to receive, on a timely basis or otherwise, the required approvals of the Proposed Merger by the Company’s stockholders; the possibility that any or all of the various conditions to the consummation of the Proposed Merger may not be satisfied or waived, including the failure to receive any required regulatory approvals from any applicable governmental entities (or any conditions, limitations or restrictions placed on such approvals); the possibility that competing offers or acquisition proposals for the Company will be made; the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive transaction agreement relating to the Proposed Merger, including in circumstances which would require the Company to pay a termination fee; the effect of the announcement or pendency of the Proposed Merger on the Company’s ability to attract, motivate or retain key executives and employees, its ability to maintain relationships with its customers, suppliers and other business counterparties, or its operating results and business generally; risks related to the Proposed Merger diverting management’s attention from the Company’s ongoing business operations; the risk of stockholder litigation in connection with the Proposed Merger, including resulting expense or delay; risks and uncertainties related to the Company’s divestiture of its commercial business (the “Commercial Divestiture”) and the Company’s exit from its residential solar business (the “ADT Solar Exit”); the Company’s ability to successfully integrate the acquisition of Origin AI and realize expected benefits of the acquisition; the Company’s ability to execute on transformation initiatives, including technology initiatives related to artificial intelligence and whole-home intelligence; the Company’s ability to maintain and grow the Company’s existing customer base, including the conversion of customers who continue to utilize outdated technology, and to integrate strategic bulk purchases of customer accounts; the impact of cyber attacks or related breaches with respect to information technology systems, cybersecurity, or data security involving the Company, our business partners, or other third parties whose systems are interconnected with ours, and any future or still undetected attacks or incidents; any material changes to the valuation allowances the Company takes with respect to its deferred tax assets; any changes in regulations or laws, global, economic, sovereign, political, or financial conditions, including labor and tax law changes or any impacts on the global economy or consumer discretionary spending due to tariffs or otherwise, changes to privacy requirements, changes to telemarketing, email marketing and similar consumer protection laws, interest rate volatility, and trade tariffs and restrictions applicable to the products we sell; the Company’s dependence on third-party providers, suppliers, dealers, and retail partners to enable it to produce and distribute its products and services in a cost-effective manner that protects the Company’s brand; the Company’s ability to effectively implement its strategic partnership with, and utilize any of the amounts invested by, Google; the Company’s ability to expand ADT+ and achieve expected adoption and customer engagement; risks related to the Company's use of AI in its products, services, and operations, including evolving legal and regulatory requirements, technological limitations, potential liability, and reputational concerns; the expected shift in the Company's transaction mix (including increased outright equipment sales) and the related effects on the timing and mix of revenue and costs; and risks that are described in the Company’s most recently filed Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q, including the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in those reports, and in the Company’s other filings with the SEC. Any forward-looking statement made in this press release speaks only as of the date on which it is made. ADT undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, unless required by law.