Alarm.com Holdings, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance

• Total revenue increased 9.0% year-over-year to $279.4 million for the quarter ended September 30, 2026, compared to $256.4 million in the same period in 2025.
• SaaS and license revenue grew 9.0% to $191.2 million, up from $175.4 million in the prior year period.
• GAAP net income was $34.3 million for the quarter, down from $35.1 million in the prior year period.
• GAAP net income attributable to common stockholders was $34.4 million, or $0.66 per diluted share, compared to $35.3 million, or $0.65 per diluted share, in the prior year period.
• Non-GAAP adjusted EBITDA increased to $66.2 million for the quarter, compared to $55.5 million in the prior year period.
• Non-GAAP adjusted net income attributable to common stockholders was $48.3 million, or $0.90 per diluted share, compared to $39.5 million, or $0.71 per diluted share, in the prior year period.
• Cash flows from operating activities for the nine months ended September 30, 2026, were $167.6 million, compared to $117.4 million for the same period in 2025.
• Non-GAAP free cash flow for the nine months ended September 30, 2026, was $156.3 million, compared to $102.0 million in the prior year period.
• Total cash and cash equivalents were $534.7 million as of September 30, 2026, a decrease from $960.6 million as of December 31, 2025, primarily due to the settlement of $500.0 million in convertible senior notes.
• Deferred revenue was $20.1 million in current liabilities and $13.9 million in non-current liabilities as of September 30, 2026.

Guidance and Future Outlook

• Full-year 2026 SaaS and license revenue guidance was increased to a range of $756.1 million to $756.3 million, representing a $12.2 million increase from the midpoint of the February 2026 guidance.
• Full-year 2026 total revenue is now expected to be between $1.1011 billion and $1.1113 billion, including hardware and other revenue of $345.0 million to $355.0 million.
• Full-year 2026 Non-GAAP adjusted EBITDA guidance was increased to a range of $227.0 million to $229.0 million.
• Full-year 2026 Non-GAAP adjusted net income attributable to common stockholders is expected to be between $161.2 million and $162.6 million, based on an estimated 21.0% tax rate.
• Full-year 2026 Non-GAAP adjusted net income per diluted share is expected to be between $3.02 and $3.04, based on an estimated 56.3 million weighted average diluted shares outstanding.
• Fourth quarter 2026 SaaS and license revenue is expected to be in the range of $194.6 million to $194.8 million.

Business Segments and Product Lines

• Acquired CellGate to expand reach through an established fence and gate channel, adding cellular-powered gate access control and video intercom solutions for commercial, small business, multifamily, ranch, and estate properties.
• Expanded video portfolio with new battery-powered video doorbell and two new indoor cameras, including a premium 4MP model with integrated illumination and a physical privacy shutter.
• Launched AI Video Clip Summaries to provide subscribers with concise, plain-language descriptions of recorded video content for quicker incident understanding.

Market and Competitive Landscape

• The company describes itself as the leading platform for intelligently connected properties, serving millions of homeowners and businesses through a network of thousands of professional service providers and commercial integrators across North America and worldwide.
• The CellGate acquisition is expected to add a growing recurring revenue business with established distributor relationships.

Risks and Challenges

• Forward-looking statements involve risks including global economic uncertainty, financial market conditions, geopolitical upheaval, supply chain disruptions, interest rate fluctuations, tariffs, recession, and inflation.
• Specific risks include the impact of trade policies on hardware revenue margins and the variability of non-ordinary course litigation expenses, acquisition-related expenses, and tax adjustments which can significantly impact future GAAP financial results.
• Actual results may differ materially from guidance due to high variability and complexity regarding excluded non-GAAP items.

Management Commentary and Tone

• Management increased full-year guidance based on current expectations, citing confidence in the business outlook.
• The tone indicates a focus on expanding recurring revenue streams through strategic acquisitions and product innovation.

Other Key Points

• The company paid and fully settled the $500.0 million aggregate principal amount of its 0% convertible senior notes on January 14, 2026.
• During the nine months ended September 30, 2026, the company purchased $58.5 million of treasury stock.
• Non-GAAP financial measures exclude interest expense, amortization of intangibles and debt issuance costs, stock-based compensation, acquisition-related expenses, and litigation expenses.
• In the first quarter of 2026, the company revised its definition of certain non-GAAP metrics to exclude gains and losses on investments with readily determinable fair value, updating prior period comparables.