ADT (NYSE:ADT) reported second-quarter 2026 revenue growth of 2% to $1.3 billion, while highlighting stronger cash generation, shareholder returns and continued investment in its ADT+ technology platform, artificial intelligence tools and lower-cost customer acquisition channels.
Chairman, President and Chief Executive Officer Jim DeVries said the company generated adjusted free cash flow, including interest-rate swaps, that rose nearly 50% from a year earlier. ADT returned $684 million to shareholders during the first half of 2026, including $594 million used to repurchase and retire 86 million shares and $90 million in dividends.
Financial results and updated outlook
Chief Financial Officer Jeff Likosar said adjusted free cash flow, including interest-rate swaps, totaled $406 million in the second quarter, up $133 million, or 48%, from the prior year. First-half adjusted free cash flow reached $820 million, an increase of more than $300 million, or 64%.
Likosar attributed the cash-flow improvement primarily to working-capital timing, lower cash taxes and interest expense, and lower subscriber acquisition spending. He also cited tax-planning progress and working-capital management.
- Total revenue increased 2% to $1.3 billion.
- Monitoring and services revenue declined 1%, reflecting the loss of revenue from the multifamily business ADT divested in October 2025.
- Installation revenue increased 17% to $230 million, driven by a greater mix of outright equipment sales.
- Adjusted EBITDA was $671 million.
- Adjusted income from continuing operations was $180 million, or $0.23 per diluted share, flat from a year earlier.
- Year-to-date adjusted EPS was $0.47, up $0.03.
ADT ended the quarter with recurring monthly revenue of $360 million. Net debt was approximately $7.4 billion, equating to leverage of 2.8 times adjusted EBITDA, with a weighted average borrowing cost of about 4.3%. The company’s $800 million revolving credit facility was undrawn.
The company modestly raised its full-year outlook. ADT now expects revenue to grow about 2%, adjusted EPS to rise 2%, and adjusted free cash flow to increase approximately 30%. Likosar said the cash-flow outlook reflects tax planning and working-capital management, while noting the company expects higher cash taxes and cash interest expense in 2027.
Likosar said higher taxes and the expiration of favorable interest-rate swaps could each create a $50 million to $100 million headwind next year, though the company plans to continue seeking ways to optimize its cash generation.
Subscriber trends and acquisition strategy
ADT added 190,000 gross new subscribers during the quarter, representing $11.9 million of recurring monthly revenue. Gross additions were lower than the prior-year quarter, when the company completed a bulk acquisition of approximately 50,000 accounts, compared with a 10,000-account bulk purchase in the latest quarter.
DeVries said that excluding the difference in bulk purchases, ADT had roughly 10,000 fewer additions than in the second quarter of 2025. He attributed the decline to reduced reliance on high-cost affiliate channels and softness in the dealer channel, including one dealer in particular.
However, he said the company’s direct “do it for me” residential business posted high-single-digit organic growth year to date, while small and medium-sized business additions were up about 4% organically from the prior year.
Net cash subscriber acquisition costs were $345 million, down 7%, primarily due to fewer bulk purchases. Trailing 12-month attrition was 13.1%, flat sequentially, and revenue payback held at 2.3 years.
DeVries said relocation losses were flat and voluntary cancellations improved from last year, while non-payment cancellations were modestly higher. He cited improvements in customer-service metrics, lower turnover among retention personnel, tighter credit standards and changes to proactive retention offers as factors that could support retention over time.
ADT+ rollout, ADT Blu and AI initiatives
The company said about 30% of new customer additions in the first half were on the ADT+ platform. ADT has started rolling out the platform to its dealer network, initially launching in the Western region and beginning deployment in the Eastern region.
Chief Business Officer Omar Khan said the migration of dealers to ADT+ is expected to take three to four quarters. Since dealers account for about one-third of additions, he said benefits from the conversion should phase in over roughly nine to 12 months.
ADT also launched ADT Blu, a lower-cost, self-installed security offering available through telephone and online channels, including Amazon. Khan said the offering includes plans beginning at about $10 per month for video-only service, while professionally monitored security packages begin at $34.99, depending on equipment choices.
While the company described the rollout as early, Khan said initial data showed a majority of ADT Blu customers selecting full security packages that include sensors and a base system. Likosar said the company expects returns on subscriber acquisition spending for self-install customers to be similar to those targeted for other offerings, despite lower average pricing because acquisition costs are also lower.
DeVries said ADT plans to expand its Amazon presence and increase advertising for ADT Blu in the second half, with volume expected to begin increasing in the third and fourth quarters.
ADT also reported progress in using AI for customer service. DeVries said AI-based call routing and virtual agents helped the company handle nearly 20% fewer customer contacts through human agents and reduce service tickets by a similar amount, while customer satisfaction improved.
During the third quarter, ADT plans to begin transcribing and analyzing sales and service calls, expand virtual-agent engagement through SMS, and deploy AI-enabled fleet safety technology. The company also expects customer pilots for a Wi-Fi-based smart plug using privacy-preserving presence-sensing technology to begin in the fall, ahead of a planned early-2027 launch.
About ADT (NYSE: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.
