ADT tops Q3 profit estimates, withdraws guidance on Thrive deal
Adjusted EPS of 24 cents beat the 23 cents estimate and revenue of $1.35 billion was in line with $1.34 billion. Guidance was withdrawn after a $10.00 per share cash sale was agreed.
Key takeaways
- ADT (ADT) reported third-quarter adjusted earnings of 24 cents per share, topping the 23 cents estimate, and revenue of $1.35 billion. The company withdrew its 2026 guidance in light of its pending all-cash sale to Thrive Holdings at $10.00 per share, expected to close in the first quarter of 2027.
ADT (ADT) said on Nov. 3 that adjusted earnings per share rose to 24 cents in the third quarter from 23 cents a year earlier, topping the consensus estimate compiled by Finnhub. The security company also withdrew its 2026 guidance because it has agreed to be acquired by Thrive Holdings.
Total revenue rose 4% to $1.35 billion for the quarter ended Sept. 30, from $1.30 billion a year earlier. Revenue was in line with the $1.34 billion consensus estimate.
Here's how the company did:
- Revenue: $1.35 billion vs. $1.30 billion a year earlier
- Adjusted EPS: 24 cents vs. 23 cents a year earlier
- GAAP diluted EPS from continuing operations: 20 cents vs. 17 cents a year earlier
- Adjusted income from continuing operations: $176 million vs. $187 million a year earlier
ADT provides security, interactive and smart home solutions to residential and small business customers in the U.S. The company said its results reflected revenue growth and stable core operating metrics. Recurring monthly revenue was $360 million, against $362 million a year earlier.
"ADT delivered solid third quarter results, with revenue growth, strong year-to-date cash generation and stable core operating metrics," ADT Chairman, President and CEO Jim DeVries said. "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."
Pending Thrive Holdings deal
On Oct. 29, ADT said it had agreed to be acquired by Thrive Holdings in an all-cash transaction. Stockholders will receive $10.00 per share in cash on completion, a price the board approved unanimously.
The deal is expected to close in the first quarter of 2027, subject to customary conditions, including approval by stockholders and U.S. antitrust approval. Until then, ADT will continue to operate as a public company. After completion, it will be privately held and its common stock will stop trading on the New York Stock Exchange.
The company will not take questions on its earnings call because of the proposed acquisition.
Guidance withdrawn
ADT is not providing financial guidance and is withdrawing the outlook it issued earlier. On July 30, the company had raised its 2026 outlook to project revenue growth of about 2%, adjusted EPS growth of about 2% and Adjusted Free Cash Flow (including interest rate swaps) growth of about 30%, all versus the prior year.
Cash and capital returns
Net cash provided by operating activities was $440 million, down $40 million from the year-earlier quarter. Adjusted Free Cash Flow (including interest rate swaps) was $217 million, up $8 million.
The company repurchased and retired 3 million shares for $23 million in the quarter. Year to date it has repurchased 89 million shares for $617 million. Including dividends, it has returned $748 million to shareholders in 2026 so far.
In August, ADT secured $100 million of incremental borrowings under its First Lien Term Loan A due 2030. It also completed a bulk purchase of about 8,000 customer accounts for $9 million in cash.