ADT raises 2026 outlook after strong Q2 cash flow

BOCA RATON, Fla.—ADT reported modest revenue growth and significantly higher cash generation in the second quarter, prompting the company to raise its full-year 2026 financial outlook while continuing to invest in new smart home and artificial intelligence (AI)-driven initiatives. 

Total revenue increased 2% year over year to $1.31 billion, driven by growth in installation, product and other revenue, which rose 17% to $230 million. Monitoring and related services revenue declined 1% to $1.08 billion, reflecting the impact of the company's October 2025 divestiture of its multifamily business. 

ADT reported income from continuing operations of $155 million, or $0.19 per diluted share, compared with $168 million a year earlier. Adjusted income from continuing operations totaled $180 million, or $0.23 per diluted share. 

The company's strongest performance came from cash generation. Net cash provided by operating activities rose 18% to $666 million, while adjusted free cash flow, including interest rate swaps, climbed 48% to $406 million. 

“ADT delivered another quarter of solid performance reflecting the resilience of our business model,” said Chairman, President and CEO Jim DeVries. “Strong cash generation supported significant capital returns to shareholders, including elevated share repurchases, underscoring our disciplined approach to capital allocation while continuing to invest in the business.” 

Focus on ADT+ 

ADT highlighted several strategic initiatives designed to support future growth, including the launch of ADT Blu, a self-installed security offering that combines do-it-yourself (DIY) installation with the ADT+ platform and optional professional monitoring. 

The company continues to build out its ADT+ ecosystem while advancing proprietary ambient sensing technology based on Wi-Fi signals. During the quarter, ADT reported progress toward commercialization of privacy-focused presence-sensing capabilities, including initial manufacturing of a smart plug device. 

Outlook raised 

Based on first-half performance and expectations for the remainder of the year, ADT raised its 2026 outlook. 

The company now expects approximately 2% growth in total revenue, about 2% growth in adjusted earnings per share and roughly 30% growth in adjusted free cash flow, including interest rate swaps. 

ADT ended the quarter with recurring monthly revenue of $360 million and gross customer revenue attrition of 13.1%, compared with 12.8% a year earlier. 

“Concurrently, we remain focused on improving attrition trends as we navigate a dynamic and competitive environment,” DeVries said. “We are well positioned to build on our progress through the second half of the year and deliver on our 2026 outlook while creating long-term shareholder value.” 

Related: ADT CEO: Beyond the burglar alarm 

Photo courtesy of ADT