Management is transitioning ADT from reactive alarm monitoring to ‘ambient intelligence’ by integrating Origin AI’s Wi-Fi sensing technology into the proprietary ADT Plus platform.
Performance in 2025 was driven by growth in monitoring and services revenue alongside higher installation revenue per unit, which helped double adjusted free cash flow since 2021.
The company is intentionally shifting its go-to-market model to favor lower-cost acquisition channels, such as e-commerce and direct-to-consumer, while rationalizing high-cost affiliate and dealer partnerships.
Operational efficiency is being scaled through ‘virtual service’ initiatives, which now resolve approximately 50% of service calls via remote diagnosis rather than physical truck rolls.
Strategic positioning focuses on ‘protection that follows people,’ expanding beyond property security into aging-in-place, health monitoring, and mobile safety via the MySafety app.
The acquisition of Origin AI provides a ‘sixth sense’ for the home, using Wi-Fi signal deflection to detect falls or breathing patterns without cameras, addressing consumer privacy concerns.
2026 is designated as a transition year with revenue and EPS expected to be approximately flat due to the divestiture of the multifamily business and short-term disruption from channel rationalization.
Management targets a long-term financial framework of 5% revenue CAGR and 10% EPS CAGR, supported by a goal of adding 1,000,000 more subscribers by 2030.
The company anticipates approximately $45,000,000 in additional subscriber acquisition costs during 2026 specifically due to the uncertain tariff environment.
A new $1,500,000,000 three-year share repurchase authorization reflects management’s view that the current stock price does not capture the intrinsic value of the recurring revenue base.
Commercialization of Origin AI’s technology across the full ADT Plus platform is slated to begin in 2027, following a pilot program scheduled for 2026.
The divestiture of the multifamily business in October 2024 removed approximately $2,600,000 in RMR and 200,000 subscribers, creating a year-over-year revenue headwind.
Attrition ended 2025 at 13.1%, slightly higher than record lows due to elevated non-paid disconnects, though management targets a reduction to 11% by 2030.
A five-year agreement with Verisure, valued at a minimum of $30,000,000 plus fees, was signed to scale Origin AI technology across their footprint in Europe and Latin America.
The company plans to invest approximately $50,000,000 in 2026 toward product technology, AI infrastructure, and the launch of the value-conscious ‘ADT Blue’ product line.
