ADI Global Distribution (ADIG) Q2 2026 earnings summary

Executive summary

• Completed spin-off from Resideo and began trading independently on NYSE as of August 4, 2026, establishing operational independence and a focus on value creation.

• Achieved record Q2 2026 net revenue of $1,286 million, up 1% year-over-year, with net income of $6 million versus a net loss of $283 million in Q2 2025.

• Commercial security, professional AV, and data communications segments drove growth, while residential AV remained weak due to U.S. housing softness.

• Focused on operational efficiency, unified customer experience, and margin expansion through platform investments.

• Exclusive brands represented 18% of 2025 revenue, with ongoing efforts to increase penetration and resilience.

Financial highlights

• Q2 2026 net revenue grew 1% year-over-year to $1,286 million; gross profit rose to $292 million, with gross margin up 50 bps to 22.7%, aided by $20 million in tariff refunds.

• Adjusted EBITDA was $86 million (6.7% margin), down from $95 million (7.4%) in Q2 2025.

• Net income was $6 million, compared to a net loss of $283 million in the prior year, which included a $331 million Honeywell indemnification expense.

• Operating cash flow for the first half was negative $76 million, mainly due to working capital and timing of payments.

• Operating expenses rose 18.1% in Q2 2026, mainly due to inflation, investments, and $18 million in spin-off related costs.

Outlook and guidance

• Full-year 2026 net revenue expected between $4,950 million and $5,000 million; Adjusted Standalone EBITDA projected at $275–$295 million.

• Second half 2026 revenue guidance: $2,458–$2,508 million; Adjusted Standalone EBITDA: $139–$159 million.

• Second half revenue growth projected in the mid-single digits, with average daily sales growth 2 points higher due to fewer selling days.

• Gross margin rates expected to remain consistent with first half, excluding Q2 tariff rebates; margin pressure from supplier transition and business mix.

• Cost actions to yield $30 million gross savings in 2026 and at least $80 million annualized by end of 2027.