APi Group raises 2026 forecast as Q3 profit tops estimates

APi Group Corporation (APG) said in a press release furnished with a regulatory filing on Oct. 29 that third-quarter adjusted diluted earnings per share rose 22% to 50 cents per share, topping the 47-cent consensus estimate compiled by Finnhub. The company also raised its full-year 2026 forecasts for net revenues and adjusted EBITDA.

Net revenues rose 22.5% to $2.55 billion, or 15.7% on an organic basis, which excludes material acquisitions, material divestitures and currency effects. Revenue also topped the $2.43 billion consensus estimate.

Reported net income was $114 million, up from $93 million a year earlier. Reported diluted EPS was 24 cents, up from 20 cents.

Here's how the company did:

• Adjusted diluted EPS: 50 cents per share vs. 41 cents a year earlier, against the 47 cents expected, according to Finnhub
• Net revenues: $2.55 billion vs. $2.09 billion a year earlier, against the $2.43 billion expected, according to Finnhub
• Adjusted EBITDA: $350 million vs. $281 million a year earlier
• Net income: $114 million vs. $93 million a year earlier
• Gross profit margin: 30.1% vs. 31.3% a year earlier

Adjusted EBITDA margin was 13.7%, up 20 basis points from 13.5% a year earlier.

CEO Russ Becker said, “We enter the fourth quarter from a position of strength, supported by a growing backlog and improving margins.”

2026 guidance

The company raised its net revenues forecast to $9,200 million to $9,250 million, up from the $8,875 million to $9,025 million range it gave on July 30.

Its adjusted EBITDA forecast rose to $1,235 million to $1,255 million, from $1,205 million to $1,245 million on July 30.

The company now expects adjusted free cash flow conversion of 110%, based on adjusted net income, down from the 115% it gave on July 30.

The company said it cannot provide a quantitative reconciliation of forward-looking adjusted EBITDA to GAAP without unreasonable effort.

Segment results

Safety Services net revenues were $1,662 million, up 18.5% from a year earlier, or 8.8% organically. Segment earnings rose 19.1% to $281 million, a 16.9% margin.

Specialty Services net revenues rose 30.7% to $893 million, or 29.9% organically. The company attributed the growth to project and service revenues. Segment earnings rose 38.3% to $112 million, with a 12.5% margin, up 60 basis points.

Margins and cash

Gross profit margin fell 120 basis points to 30.1% from 31.3%, which the company attributed to project and business mix and rising material, fuel, and other expenses. Adjusted SG&A fell to 17.6% of net revenues from 19.3%.

Acquisitions, net of cash acquired, totaled $1,356 million in the nine months ended Sept. 30, compared with $174 million a year earlier.

Cash and cash equivalents were $373 million at Sept. 30, down from $912 million at Dec. 31, 2025. Repurchases of common stock were $252 million in the nine months, up from $75 million.