ADT (NYSE:ADT) Releases Quarterly Earnings Results, Meets Expectations

Key Points

• ADT reported Q1 EPS of $0.23, met consensus with revenue of $2.56 billion (up 0.9% YoY) and reaffirmed FY‑2026 EPS guidance of $0.89.
• The company generated $414 million of adjusted free cash flow (up >80% YoY), has repurchased ~35 million shares YTD with a $1.5 billion repurchase authorization and leverage around 2.7x, supporting continued buybacks.
• ADT faces significant operational and legal risk after reports a data breach exposed roughly 5.5 million customer records, prompting class‑action and regulatory exposure that could drive remediation costs and customer churn.

ADT (NYSE:ADT - Get Free Report) announced its earnings results on Thursday. The security and automation business reported $0.23 EPS for the quarter, hitting the consensus estimate of $0.23, FiscalAI reports. The business had revenue of $2.56 billion during the quarter, compared to the consensus estimate of $1.28 billion. ADT had a net margin of 11.60% and a return on equity of 19.16%. ADT's revenue was up .9% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.21 EPS. ADT updated its FY 2026 guidance to 0.890-0.890 EPS.

Here are the key takeaways from ADT's conference call:

• ADT generated $414 million of adjusted free cash flow in Q1 (up >80% YoY), repurchased ~35 million shares year-to-date and has a $1.5 billion repurchase authorization, while leverage remains around 2.7x, supporting continued buybacks and balance-sheet flexibility.
• Adoption of ADT+ is accelerating — ~30% of Q1 new customers were on the platform, two new features (Live Light and MySafety) launched, and the Origin AI acquisition + smart‑plug pilots are intended to drive richer, privacy‑first home sensing; management expects >2/3 of new subscribers on the proprietary platform as dealers transition.
• AI is being deployed across service and operations to cut costs and improve experience — all chats and ~50% of calls are initially routed through AI, containment rates have risen (chat ~45%→60%, calls ~16%→25%), and management cites potential savings in the millions to tens of millions over time.
• ADT is entering the DIY/e‑commerce market with Blue by ADT (website late May, Amazon this summer) to expand TAM; management expects most DIY subs to be incremental but acknowledges lower upfront economics and plans to convert some to higher‑margin pro‑install customers.
• Management intentionally tightened high‑cost acquisition channels and credit standards and scaled back some dealer activity, which contributed to lower gross adds in Q1 and could weigh on near‑term RMR/subscriber growth despite aiming for improved long‑term payback and efficiency.

ADT Price Performance

Shares of NYSE:ADT traded up $0.38 during midday trading on Thursday, hitting $7.55. The stock had a trading volume of 13,547,196 shares, compared to its average volume of 10,197,154. The company's 50-day moving average price is $6.95 and its 200-day moving average price is $7.75. The company has a market capitalization of $6.19 billion, a P/E ratio of 11.43 and a beta of 1.04. The company has a quick ratio of 0.73, a current ratio of 0.93 and a debt-to-equity ratio of 1.95. ADT has a fifty-two week low of $6.25 and a fifty-two week high of $8.94.

ADT Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, July 7th. Stockholders of record on Thursday, June 11th will be given a $0.055 dividend. The ex-dividend date is Thursday, June 11th. This represents a $0.22 annualized dividend and a dividend yield of 2.9%. ADT's payout ratio is presently 33.33%.

Key Headlines Impacting ADT

Here are the key news stories impacting ADT this week:

• Positive Sentiment: Q1 results showed earnings strength and cash‑flow improvement — ADT reported Q1 EPS of $0.23 (in line/ slightly ahead of some estimates) with GAAP EPS up ~25% and adjusted EPS up ~10%. Operating cash flow and adjusted free cash flow rose sharply, and the company returned $161M to shareholders through buybacks/dividends, which supports near‑term investor appetite. GlobeNewswire: ADT Reports First Quarter 2026 Results
• Positive Sentiment: FY‑2026 guidance was reaffirmed/slightly nudged: ADT set EPS guidance at $0.890 (versus a ~$0.880 consensus) and revenue guidance of ~$5.1B (in line with expectations). The modest EPS beat and stable revenue outlook reduce near‑term forecast risk. Quiver Quantitative: ADT Releases Q1 2026 Earnings
• Neutral Sentiment: Analyst and institutional positioning is mixed — the median price target sits near $7.75 with recent divergent analyst views, and some large funds have materially changed holdings. That creates both upside via positive revisions and downside if sell‑side sentiment turns. Quiver Quantitative: Analyst/Institutional Activity
• Negative Sentiment: Major data‑breach and litigation risk — multiple reports say data from ~5.5M customers was exposed and attackers have begun leaking records; a class action and regulatory exposure have been reported. This is a significant operational and reputational risk that could drive remediation, legal costs and customer churn. Bloomberg Law: ADT Sued Over Data Breach

Insider Transactions at ADT

In other ADT news, EVP David A. Scott purchased 7,300 shares of the firm's stock in a transaction on Thursday, March 5th. The stock was purchased at an average cost of $6.72 per share, for a total transaction of $49,056.00. Following the transaction, the executive vice president owned 7,300 shares in the company, valued at $49,056. The trade was a ∞ increase in their position. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Company insiders own 2.70% of the company's stock.

Hedge Funds Weigh In On ADT

Several institutional investors and hedge funds have recently added to or reduced their stakes in the business. Invesco Ltd. increased its position in ADT by 16.2% in the 4th quarter. Invesco Ltd. now owns 1,444,275 shares of the security and automation business's stock valued at $11,655,000 after acquiring an additional 201,873 shares during the period. Corient Private Wealth LLC increased its position in ADT by 241.7% in the 4th quarter. Corient Private Wealth LLC now owns 92,165 shares of the security and automation business's stock valued at $744,000 after acquiring an additional 65,189 shares during the period. Mercer Global Advisors Inc. ADV increased its position in ADT by 16.6% in the 4th quarter. Mercer Global Advisors Inc. ADV now owns 532,433 shares of the security and automation business's stock valued at $4,297,000 after acquiring an additional 75,993 shares during the period. EP Wealth Advisors LLC acquired a new position in ADT in the 4th quarter valued at approximately $462,000. Finally, NewEdge Advisors LLC raised its position in shares of ADT by 18.8% during the fourth quarter. NewEdge Advisors LLC now owns 37,163 shares of the security and automation business's stock worth $300,000 after acquiring an additional 5,882 shares during the last quarter. 87.22% of the stock is currently owned by institutional investors and hedge funds.

Analyst Upgrades and Downgrades

Several brokerages recently commented on ADT. Barclays reaffirmed an "underweight" rating and set a $7.00 target price on shares of ADT in a report on Friday, March 6th. Morgan Stanley cut their price objective on shares of ADT from $9.00 to $7.00 and set an "equal weight" rating for the company in a report on Tuesday, March 3rd. The Goldman Sachs Group reissued a "buy" rating and issued a $10.40 price objective on shares of ADT in a report on Monday, March 2nd. Zacks Research raised shares of ADT from a "strong sell" rating to a "hold" rating in a report on Monday, February 16th. Finally, Citigroup cut their price objective on shares of ADT from $10.00 to $8.50 and set a "buy" rating for the company in a report on Wednesday, March 4th. Two research analysts have rated the stock with a Buy rating, three have given a Hold rating and one has given a Sell rating to the company. According to MarketBeat, the stock currently has a consensus rating of "Hold" and an average price target of $8.23.

About ADT

ADT Inc is a leading provider of security and automation solutions for residential and commercial customers. The company offers a comprehensive suite of products and services, including intrusion detection systems, video surveillance, fire and carbon monoxide monitoring, and integrated smart home automation platforms. Through professional installation, continuous monitoring, and a network of 24/7 monitoring centers, ADT helps customers protect their properties, assets and loved ones.

Founded in 1874 as the American District Telegraph Company, ADT has evolved from one of the first telegraph-based alarm services into a modern security technology enterprise.

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