Allegion (ALLE) Q3 2026 earnings summary

Executive summary

• Q3 revenue rose 9.6% to $1,172.6M, with 7.2% organic growth; adjusted EPS increased 13.0% to $2.60, led by Americas non-residential demand.

• FY26 reported revenue, organic growth and adjusted EPS outlooks were raised; 2027 demand is expected to be led by the Americas.

Financial highlights

• Q3 organic revenue growth reflected 3.8% price realization and 3.4% volume growth; acquisitions and divestitures added 2.6%, while FX reduced growth by 0.2%.

• Adjusted operating margin expanded 60 bps to 24.7%; adjusted operating income increased 12.5% to $289.7M.

• Operating income rose 21.7% to $284.6M; net earnings were $220.9M versus $188.4M, and diluted EPS was $2.59 versus $2.18.

• YTD available cash flow rose 11.2% to $539.4M, primarily reflecting higher earnings.

Outlook and guidance

• FY26 reported revenue growth outlook increased to 9.5%–10.5%, organic growth to 5.0%–6.0%, and adjusted EPS to $9.05–$9.10; reported EPS outlook is $8.35–$8.40.

• Americas organic growth outlook is 7%–8%; International organic revenue is expected to decline by low single digits, reflecting continued European weakness.

• FY26 available cash flow is expected at 85%–95% of adjusted net income; assumptions include an 18%–19% adjusted tax rate and ~85.6M diluted shares.

• 2027 demand is expected to resemble 2026, led by broad-based Americas non-residential strength; residential growth is expected to be primarily price-driven, with International markets remaining soft.

• 2027 margin expansion is expected, with pricing and productivity planned to counter elevated inflation; Americas incrementals are expected within the long-term framework.