Alarm.com (ALRM) investor relations material

Executive summary

• SaaS and license revenue grew 11.1% year-over-year to $188.8 million in Q2 2026, with total revenue up 9.2% to $277.7 million, driven by subscriber growth and energy management solutions.

• Adjusted EBITDA rose to $57.7 million, reflecting operational strength, while GAAP net income declined to $24.2 million due to higher operating and legal costs.

• Commercial and energy segments, including OpenEye and EnergyHub, drove strong growth, with EnergyHub supporting 304 demand response events shifting 17.5 GWh of load.

• International business surpassed 1 million active subscribers, supported by localization and partner expansion.

• Notable product launches included a new Commercial Fire Solution and expanded remote video monitoring capabilities.

Financial highlights

• SaaS and license revenue accounted for 68% of total revenue; hardware and other revenue totaled $89 million, up 5.5% year-over-year.

• Adjusted EBITDA margin expanded to 20.8%; non-GAAP adjusted net income rose 17% to $41.1 million ($0.77 per diluted share, up 24% year-over-year).

• GAAP net income was $24.2 million ($0.48 per diluted share), down from $34.6 million a year ago.

• Free cash flow for six months was $86.8 million; cash and cash equivalents stood at $479.4 million as of June 30, 2026.

• Working capital increased to $639.8 million from $609.4 million at year-end.

Outlook and guidance

• Q3 SaaS and license revenue expected between $189.8 million and $190 million; full-year 2026 SaaS and license revenue outlook raised to $754–$754.4 million.

• Total 2026 revenue outlook increased to $1.079–$1.0894 billion; hardware revenue guidance raised by $15 million.

• Non-GAAP adjusted EBITDA for 2026 raised to $221–$223 million; adjusted net income projected at $156–$157 million ($2.92–$2.94 per diluted share).

• Targeting 21% adjusted EBITDA margins exiting 2027.

• Management expects continued volatility due to macroeconomic conditions, including supply chain disruptions, inflation, and tariffs.