Resideo Announces Third Quarter 2026 Financial Results and Updates 2026 Outlook

The $900 million ADI dividend and $200 million of cash on hand funded debt repayment following the separation.

Rhea-AI Summary

Resideo Technologies (REZI) reported third-quarter 2026 revenue of $727 million, up 3% year over year, while earnings from continuing operations declined. Revenue excluding OEM Security rose 6% to $694 million; OEM Security revenue fell 34% to $33 million. Gross margin reached 40.4%, its 14th consecutive quarter of year-over-year expansion. GAAP income from continuing operations fell 66% to $31 million, and diluted earnings per share fell 71% to $0.14. Standalone adjusted EBITDA rose 5% to $154 million.

Following the completed ADI separation, Resideo repaid $1.1 billion of gross debt, leaving $2.1 billion outstanding and $229 million in cash at October 3. Resideo expects full-year revenue of $2,927–$2,947 million, standalone adjusted EBITDA of $614–$624 million and standalone adjusted earnings per share of $1.92–$1.98. Fourth-quarter revenue guidance is $710–$730 million.

15 points · 1 major

MixediHow this balance works

How this balance works

Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.

It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

How the balance worksHow Sentiment works

0 major · 14 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major pointGross debt repayment of $1.1 billion left $2.1 billion outstanding at October 3, 2026. 36% of market cap
• Moderate pointThird-quarter revenue increased 3% year over year to $727 million.
• Moderate pointGross margin reached 40.4%, marking 14 consecutive quarters of year-over-year expansion.
• Moderate pointStandalone adjusted EBITDA increased 5% year over year to $154 million.
• Moderate pointStandalone adjusted diluted earnings per share increased 8% year over year to $0.52.
• Moderate pointThird-quarter continuing operating cash flow improved to $33 million from $1.59 billion used a year earlier.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Resideo expects full-year revenue of $2,927–$2,947 million and fourth-quarter revenue of $710–$730 million.
• Moderate pointNine-month continuing operations generated $170 million income, versus a $735 million loss a year earlier.

7 minor points

• Minor pointRevenue excluding OEM Security rose 6% to $694 million, with growth across sales channels and product categories.
• Minor pointPreferred shares outstanding fell by 150,000 to 350,000, with a smaller ongoing quarterly dividend payable.
• Minor point. Forward-looking: it has not happened yet and may not happen.Resideo expects standalone adjusted EBITDA of $614–$624 million for 2026 and $145–$155 million for Q4.
• Minor point. Forward-looking: it has not happened yet and may not happen.Resideo expects standalone adjusted earnings per share of $1.92–$1.98 for 2026 and $0.42–$0.48 for Q4.
• Minor point. Forward-looking: it has not happened yet and may not happen.Resideo expects full-year cash provided by operating activities of at least $165 million.
• Minor pointNine-month revenue increased to $2,217 million from $2,108 million a year earlier.
• Minor pointHoneywell Tax Matters Agreement termination generated a $77 million gain in the first nine months of 2026.

Negative

• Moderate pointThird-quarter GAAP continuing-operations income fell 66% to $31 million from $90 million a year earlier.
• Moderate pointThird-quarter selling, general and administrative expenses rose $24 million, primarily reflecting $30 million of ADI separation expenses.
• Moderate pointThird-quarter restructuring, impairment and extinguishment expenses increased $17 million with manufacturing optimization and higher debt extinguishment charges.
• Moderate pointThird-quarter operating income declined to $72 million from $106 million a year earlier.
• Moderate pointCash and cash equivalents declined to $229 million at October 3 from $537 million at December 31, 2025.
• Moderate pointNine-month net interest expense increased to $97 million from $81 million a year earlier.

8 minor points

• Minor pointThird-quarter GAAP diluted continuing-operations earnings per share fell 71% to $0.14.
• Minor pointOEM Security revenue declined 34% to $33 million as a large customer's volumes decreased.
• Minor pointForeign exchange reduced third-quarter revenue by approximately 50 basis points.
• Minor pointThird-quarter research and development expenses rose $4 million, driven by investment in new product launches.
• Minor pointThird-quarter discontinued operations recorded a $9 million loss, versus $66 million income a year earlier.
• Minor pointPost-separation cash adjustment required a $20 million payment to ADI.
• Minor pointThird-quarter capital expenditures increased to $22 million from $13 million a year earlier.
• Minor pointNine-month operating income declined to $275 million from $319 million a year earlier.

News Explained

After completing the ADI separation on August 3, Resideo reduced its outstanding convertible preferred stock by 150,000 shares to 350,000; its conversion price was adjusted proportionally, and a smaller quarterly dividend remains payable.

Argus 15 min delay 4 alerts

-6.74% vs previous close $18.14 last price 1.2x rel. volume Open Argus

Details

Market move: REZI -6.74% vs previous close. 3Q26 earnings report

$18.04 – $20.36 Day Range

$2.75B Mkt Cap at Last Price

On Nov 10, the day this news came out, the latest delayed price for REZI is 6.74% below the previous close. Our momentum scanner has recorded 4 alerts for this stock so far that day. The latest delayed price is $18.14.

Data tracked by StockTitan Argus (15 min delayed). Upgrade to Gold for real-time data.

Key Figures

Revenue: $727 million, up 3% year-over-year GAAP income from continuing operations: $31 million, down 66% Standalone Adjusted EBITDA: $154 million, up 5% +5 more

Revenue

$727 million, up 3% year-over-year

Q3 2026

GAAP income from continuing operations

$31 million, down 66%

Q3 2026 versus $90 million in Q3 2025

Standalone Adjusted EBITDA

$154 million, up 5%

Q3 2026 versus Q3 2025

Standalone Adjusted diluted EPS

$0.52, up 8%

Q3 2026 year-over-year

Gross debt repaid

$1.1 billion

During Q3 2026

2026 revenue outlook

$2.927–$2.947 billion

Updated full-year 2026 outlook

2026 Standalone Adjusted EBITDA outlook

$614–$624 million

Updated full-year 2026 outlook

2026 Standalone Adjusted EPS outlook

$1.92–$1.98

Updated full-year 2026 outlook

Previous Earnings Reports

1 past event · Latest: Aug 12

Same Type 1 event

1. Aug 12

   Q2 earnings

   24h Move

   -20.4%

   Reported standalone outlook and EBITDA growth, providing the baseline for updated full-year guidance.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

adjusted ebitda, diluted eps, non-gaap financial measures, convertible participating preferred stock

4 terms

adjusted ebitda financial

"Standalone Adjusted EBITDA (1) of $154 million, up 5% year-over-year"

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

diluted eps financial

"GAAP diluted EPS from continuing operations of $0.14"

Diluted earnings per share (EPS) shows how much profit a company makes for each share of stock, assuming all possible shares from stock options or convertible securities are used. It provides a more conservative estimate than basic EPS, accounting for potential share increases that could dilute ownership. Investors use diluted EPS to get a clearer picture of a company's true profitability on a per-share basis.

non-gaap financial measures financial

"This press release includes certain Non-GAAP financial measures"

Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.

convertible participating preferred stock financial

"outstanding Series A Cumulative Convertible Participating Preferred Stock"

Preferred shares that combine three features: a fixed preference (usually a priority claim on dividends and on proceeds in a liquidation), the right to "participate" with common shareholders in additional dividends or liquidation proceeds after the preference is paid, and a conversion feature allowing the preferred shares to be exchanged for common stock under specified terms. The participation means holders receive their preference and then share pro rata in any remaining distribution, and the conversion lets them switch to common stock (often at a set ratio or upon certain events) to capture further upside instead of keeping the preference.

AI-generated analysis. How Rhea-AI works. Not financial advice.

See more from StockTitan in Google Search and AI answers. Adds StockTitan as a preferred source · opens Google

Add on Google Not now

• Total revenue of $727 million, up 3% year-over-year, and revenue excluding OEM Security up 6% year-over-year
• Gross margin of 40.4%, marking the 14th consecutive quarter of year-over-year gross margin expansion
• GAAP income from continuing operations, net of taxes, of $31 million, down 66% compared to $90 million in third quarter of 2025; Standalone Adjusted EBITDA ⁽¹⁾of $154 million, up 5% year-over-year
• GAAP diluted EPS from continuing operations of $0.14, down 71% year-over-year; Standalone Adjusted diluted EPS ⁽¹⁾of $0.52, up 8% year-over-year
• Repaid $1.1 billion of gross debt; total gross debt of $2.1 billion at end of third quarter

SCOTTSDALE, Ariz., Nov. 10, 2026 /PRNewswire/ -- Resideo Technologies, Inc. (NYSE: REZI), a leading global developer and manufacturer of critical control and sensing solutions for residential markets, today announced financial results for the third fiscal quarter ended October 3, 2026.

Management Remarks

"Resideo delivered top and bottom line third quarter results that were near the high end of our outlook ranges in our first quarter following the separation of ADI, underscoring our team's continued strong execution. We achieved 3% revenue growth year-over-year across all sales channels and 6% growth year-over-year excluding OEM Security, driven by customer demand for our differentiated, non-discretionary products. We also reduced our debt by $1.1 billion, using the $900 million dividend received from ADI and $200 million of cash on hand," said Tom Surran, Resideo's President and CEO.

"We remain focused on creating value for our customers with our differentiated products and services. That includes new AI-powered capabilities on our next-generation FORTIQ software platform, which delivers actionable intelligence that enhances customer productivity and optimizes the end-user's experience. We are executing on our strategic priorities with discipline and consistency, creating positive momentum in a soft housing market and a dynamic macro environment."

Third Quarter 2026 Financial Highlights

Total revenue of $727 million was up 3% compared to $703 million in the third quarter of 2025, and includes an unfavorable impact of approximately 50 basis points from foreign currency exchange. Total revenue was near the high-end of the provided outlook range for the third quarter of 2026.

Revenue excluding OEM Security of $694 million, was up 6% compared to $653 million in the third quarter of 2025, and grew year-over-year across all of our sales channels and product categories due to volume, driven by customer demand for our products, and pricing. OEM Security revenue of $33 million was down 34% compared to $50 million in the third quarter of 2025, and declined as expected due to reduced volumes from a large OEM Security customer.

Gross margin of 40.4%, marking the 14th consecutive quarter of year-over-year gross margin expansion. Gains from price increases, operational efficiencies, and tariff refunds were partially offset by unfavorable product sales mix and inflationary input costs.

Research and development expenses increased $4 million from the third quarter of 2025 driven by investments in new product launches to drive future growth. Selling, general and administrative expenses increased $24 million from the third quarter of 2025, driven primarily by $30 million of non-recurring business separation expenses associated with the ADI Spin-Off. Restructuring, impairment and extinguishment expenses increased $17 million from the third quarter of 2025 due to continued manufacturing operations optimization and higher debt extinguishment charges.

GAAP income from continuing operations, net of taxes, of $31 million was down 66% compared to $90 million in the third quarter 2025. Standalone Adjusted EBITDA⁽¹⁾ of $154 million was up 5% compared to $146 million in the third quarter of 2025, primarily due to higher gross profit dollars and controlled growth in operating expenses. Standalone Adjusted EBITDA was near the high-end of the provided outlook range for the third quarter of 2026.

Cash Flow and Liquidity

Net cash provided by operating activities of continuing operations was $33 million in the third quarter 2026 compared to net cash used by operating activities of continuing operations of $1.59 billion in the third quarter of 2025. The increase in cash provided by operations was primarily due to the $1.59 billion payment made in the third quarter of 2025 to Honeywell to terminate the Indemnification Agreement.

In connection with the ADI Spin-Off, Resideo received a $900 million cash dividend from ADI as partial consideration for the assets transferred in the ADI Spin-Off. We used this dividend, along with $200 million of cash on hand to repay $1.1 billion of gross debt during the third quarter. We also made a $20 million payment to ADI as part of the post-separation adjustment mechanism to true up cash. At October 3, 2026, Resideo had cash and cash equivalents of $229 million and total outstanding gross debt of $2.1 billion.

In connection with the completion of the ADI Spin-Off, Resideo's outstanding Series A Cumulative Convertible Participating Preferred Stock ("Preferred Stock") was reduced by 150,000 shares, leaving 350,000 shares outstanding, with a proportional adjustment to the conversion price and an ongoing smaller quarterly dividend payable on Resideo's Preferred Stock.

ADI Spin-Off and Discontinued Operations

On August 3, 2026, Resideo completed the separation of its former ADI Global Distribution segment by distributing to Resideo common shareholders on a pro rata basis all of the issued and outstanding common stock of ADI Global Distribution Inc., the entity incorporated to hold the ADI business (the "ADI Spin-Off"). As a result of the ADI Spin-Off, we present the historical results of the ADI business as discontinued operations in our financial statements.    

Outlook

The following table summarizes Resideo's fourth quarter 2026 and updated full year 2026 outlook:

($ in millions, except per share data)	Q4 2026	2026
Revenue	$710 - $730	$2,927 - $2,947
Standalone Adjusted EBITDA (1)	$145 - $155	$614 - $624
Standalone Adjusted Earnings Per Share (1)	$0.42 - $0.48	$1.92 - $1.98
Full Year Cash Provided by Operating Activities		At least $165

Conference Call and Webcast Details

Resideo will hold a conference call with investors on November 10, 2026, at 5:00 p.m. ET. The webcast can be accessed at https://investor.resideo.com, where the webcast link and related materials will be posted before the call. A replay of the webcast will be available following the presentation.

About Resideo

Resideo is a global building technologies company that is a leading developer and manufacturer of critical control and sensing solutions for residential markets. The company serves professional installers and integrators across diverse product categories, such as heating, ventilation, and air conditioning controls, combustion, life safety, security, and water. Its comfort and protection solutions can be found in more than 150 million residential and commercial spaces globally, with tens of millions of new devices sold annually. More information about Resideo and its trusted brands, including BRK, First Alert, and Honeywell Home, is available at resideo.com.

(1)

This press release includes certain Non-GAAP financial measures, including Adjusted EBITDA, Adjusted Net Income, Adjusted Diluted EPS, and other supplemental financial measures we denote as "Standalone" measures, including Standalone Adjusted EBITDA, Standalone Adjusted Net Income and Standalone Adjusted Diluted EPS, which are presented as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented. See the section herein titled "Use of Non-GAAP and Standalone Supplemental Financial Measures" for more information.

Contacts:
Investors:		Media:
Christopher T. Lee		Kevin Hunt
Global Head of Strategic Finance		Director, Corporate Communications
investorrelations@resideo.com		kevin.hunt@resideo.com

Forward-Looking Statements

This press release and the related conference call contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, that address activities, events or developments that we or our management intend, expect, project, believe or anticipate will or may occur in the future are forward-looking statements, including statements regarding our fourth quarter 2026 and full year 2026 outlook, our capital allocation and deleveraging plans, the expected benefits of the ADI Spin-Off, operational efficiency improvement, and the development, launch and adoption of new products and capabilities. Although we believe forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks and uncertainties, which may cause the actual results or performance of Resideo Technologies, Inc. ("Resideo" or the "Company") to differ materially from such forward-looking statements.

Such risks and uncertainties include, but are not limited to, our ability to achieve our outlook regarding the fourth quarter 2026 and full year 2026; the ability of Resideo to drive increased customer value and financial returns and enhance strategic and operational capabilities, including through our product offerings, services, ability to compete, and manage any expected OEM Security impacts; risks and uncertainties relating to tariffs that have been or may be imposed by the United States and other governments including the timing, amount and recoverability of tariff refunds or claims in relation to refunds; risks related to our ability to achieve some or all of the expected benefits of the ADI Spin-Off, our dependence on transition services, the commercial product purchase agreement and other arrangements with ADI, our dependence on a select group of large customers, and changes to our capital structure, leverage and liquidity resulting from the ADI Spin-Off; our ability to repay outstanding debt obligations on the timing we anticipate or at all; macroeconomic conditions, including housing market fluctuations, interest rates, inflation, repair and remodeling and construction activity, costs of raw materials and components, and fuel and shipping costs; our ability to implement pricing actions; seasonal fluctuations and weather conditions affecting demand for our products; ability to successfully execute restructuring and productivity initiatives; and the other risks described under the headings "Risk Factors" and "Cautionary Statement Concerning Forward-Looking Statements" in our Annual Report on Form 10-K for the year ended December 31, 2025, our subsequent Quarterly Reports on Form 10-Q, and other periodic filings we make from time to time with the Securities and Exchange Commission. Forward-looking statements are not guarantees of future performance, and actual results, developments, and business decisions may differ from those envisaged by our forward-looking statements.  

Except as required by law, we undertake no obligation to update such statements to reflect events or circumstances arising after the date of this press release and we caution investors not to place undue reliance on any such forward-looking statements.

Use of Non-GAAP and Standalone Supplemental Financial Measures

This press release includes certain "Non-GAAP financial measures" as defined under the Securities Exchange Act of 1934 and in accordance with regulations issued thereunder, including Adjusted EBITDA, Adjusted Net Income, and Adjusted Diluted EPS, as well as other supplemental financial measures we denote as "Standalone" measures, including Standalone Adjusted EBITDA, Standalone Adjusted Net Income and Standalone Adjusted Diluted EPS, which are presented as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented. Management believes the use of such Non-GAAP and supplemental financial measures assists investors and our management in understanding the ongoing operating performance of the Company by presenting financial results between periods on a more comparable basis. Such Non-GAAP and supplemental financial measures should not be construed as an alternative to reported results determined in accordance with U.S. GAAP. Readers should also consider the limitations associated with these Non-GAAP and supplemental financial measures, including the potential lack of comparability of these measures from one company to another.

We have included reconciliations of these Non-GAAP and supplemental financial measures to the most directly comparable financial measures calculated and provided in accordance with U.S. GAAP at the end of this release. A reconciliation of the Non-GAAP and supplemental financial measures included as part of the outlook provided herein is not included in this release due to the number of variables in the projected range as part of such outlook and because we are currently unable to quantify accurately without unreasonable efforts certain amounts that would be required to be included in the U.S. GAAP measure or the individual adjustments for such reconciliation, including the timing and amount of restructuring, impairment and extinguishment costs, business separation costs, litigation settlements, and other non-recurring items and the related tax effects. In addition, we believe such reconciliation would imply a degree of precision that would be confusing or misleading to investors. Amounts presented in this press release may not sum due to rounding. 

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in millions, except par value)	October 3, 2026		December 31, 2025
ASSETS
Current assets:
Cash and cash equivalents	$                 229		$                 537
Accounts receivable, net	507		414
Inventory	393		318
Other current assets	110		116
Current assets of discontinued operations	—		1,973
Total current assets	1,239		3,358
Property, plant and equipment, net	336		340
Goodwill	2,026		2,036
Intangible assets, net	341		347
Other assets	198		257
Non-current assets of discontinued operations	—		2,095
Total assets	$              4,140		$              8,433
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$                 491		$                 414
Accrued liabilities	379		430
Current liabilities of discontinued operations	—		911
Total current liabilities	870		1,755
Long-term debt	2,074		3,167
Non-current obligations payable under the Honeywell Tax Matters Agreement	—		88
Other long-term liabilities	249		257
Non-current liabilities of discontinued operations	—		249
Total liabilities	3,193		5,516
Stockholders' equity:
Preferred stock, $0.001 par value: 100 shares authorized, 0.35 shares issued and outstanding, and $350 liquidation preference at October 3, 2026 and 0.5 shares issued and outstanding, and $500 liquidation preference at  December 31, 2025	337		482
Common stock, $0.001 par value: 700 shares authorized, 161 and 152 shares issued and outstanding at October 3, 2026, respectively, and 158 and 150 shares issued and outstanding at December 31, 2025, respectively	—		—
Additional paid-in capital	2,352		2,391
Retained (deficit) earnings	(1,413)		345
Accumulated other comprehensive loss	(146)		(157)
Treasury stock at cost	(183)		(144)
Total stockholders' equity	947		2,917
Total liabilities and stockholders' equity	$              4,140		$              8,433

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
	Three Months Ended				Nine Months Ended
(in millions, except per share data)	October 3, 2026		September 27, 2025		October 3, 2026		September 27, 2025
Revenue	$         727		$         703		$       2,217		$       2,108
Cost of goods sold	433		419		1,325		1,270
Gross profit	294		284		892		838
Operating expenses:
Research and development expenses	37		33		110		91
Selling, general and administrative expenses	159		135		445		403
Intangible asset amortization	6		7		19		21
Restructuring, impairment and extinguishment costs	20		3		43		4
Total operating expenses	222		178		617		519
Operating income	72		106		275		319
Indemnification Agreement expense (1)	—		—		—		972
Other expense (income), net (2)	3		6		(80)		23
Interest expense, net	31		30		97		81
Income (loss) from continuing operations before taxes	38		70		258		(757)
Provision (benefit) for income taxes	7		(20)		88		(22)
Income (loss) from continuing operations, net of taxes	31		90		170		(735)
Income (loss) from discontinued operations, net of taxes	(9)		66		(13)		72
Net income (loss)	22		156		157		(663)
Less: preferred stock dividends	7		9		24		26
Less: undistributed income allocated to preferred stockholders	2		16		15		—
Net income (loss) available to common stockholders	$          13		$         131		$         118		$        (689)
Income (loss) from continuing operations, net of taxes, available to common stockholders	$          22		$          75		$         135		$        (753)
Income (loss) from discontinued operations, net of taxes, available to common stockholders	(9)		56		(17)		64
Net income (loss) available to common stockholders	$          13		$         131		$         118		$        (689)
Income (loss) from continuing operations, net of taxes	$          31		$          90		$         170		$        (735)
Less: preferred stock dividends	6		6		18		18
Less: undistributed income allocated to preferred stockholders	3		9		17		—
Income (loss) from continuing operations, net of taxes, available to common stockholders	$          22		$          75		$         135		$        (753)
Income (loss) from discontinued operations, net of taxes	$           (9)		$          66		$         (13)		$           72
Less: preferred stock dividends	1		3		6		8
Less: undistributed (loss) income allocated to preferred stockholders	(1)		7		(2)		—
Income (loss) from discontinued operations, net of taxes, available to common stockholders	$           (9)		$           56		$         (17)		$           64
Net income (loss) available to common stockholders	$          13		$         131		$         118		$        (689)
Earnings (loss) per common share:
Basic earnings (loss) per share from continuing operations	$        0.14		$        0.50		$        0.89		$       (5.05)
Basic earnings (loss) per share from discontinued operations	(0.06)		0.38		(0.11)		0.43
Basic earnings (loss) per share attributable to common shareholders	$        0.08		$        0.88		$        0.78		$       (4.62)
Diluted earnings (loss) per share from continuing operations	$        0.14		$        0.49		$        0.88		$       (5.05)
Diluted earnings (loss) per share from discontinued operations	(0.06)		0.36		(0.11)		0.43
Diluted earnings (loss) per share attributable to common shareholders	$        0.08		$        0.85		$        0.77		$       (4.62)
Weighted average common shares outstanding:
Basic	152		149		151		149
Diluted	154		154		154		149

(1)	Represents the expense incurred pursuant to the Indemnification Agreement, which, prior to its termination, we paid our regularly scheduled payments of $70 million during 2025.
(2)	For the nine months ended October 3, 2026, Other expense (income), net, primarily represents the $77 million gain recognized pursuant to the termination of the Honeywell Tax Matters Agreement.

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  (UNAUDITED)
	Three Months Ended				Nine Months Ended
(in millions)	October 3, 2026		September 27, 2025		October 3, 2026		September 27, 2025
Cash Flows From Operating Activities:
Net income (loss)	$          22		$         156		$         157		$        (663)
Income (loss) from discontinued operations, net of taxes	(9)		66		(13)		72
Income (loss) from continuing operations, net of taxes	31		90		170		(735)
Adjustments to reconcile net income (loss) from continuing operations to net cash from operating activities:
Depreciation and amortization	21		21		64		60
Restructuring, impairment and extinguishment costs	20		3		43		4
Stock-based compensation expense	10		10		30		30
Deferred income taxes	—		—		44		(26)
Other, net	1		(11)		—		(2)
Changes in assets and liabilities:
Accounts receivable, net	(48)		(18)		(102)		(9)
Inventory	(59)		(7)		(80)		(9)
Other current assets	(3)		1		5		(14)
Accounts payable	71		(1)		75		(30)
Accrued liabilities	(4)		(99)		(53)		(9)
Non-current obligations payable under the Honeywell Tax Matters Agreement	—		—		(88)		—
Non-current obligations payable under the Indemnification Agreement	—		(1,625)		—		(723)
Other non-current, net	(7)		47		3		7
Net cash provided by (used in) continuing operations operating activities	33		(1,589)		111		(1,456)
Net cash (used in) provided by discontinued operations operating activities	(32)		18		(107)		20
Net cash provided by (used in) operating activities	1		(1,571)		4		(1,436)
Cash Flows From Investing Activities:
Capital expenditures	(22)		(13)		(62)		(43)
Other investing activities, net	—		—		10		—
Net cash used in continuing operations investing activities	(22)		(13)		(52)		(43)
Net cash used in discontinued operations investing activities	(5)		(15)		(30)		(36)
Net cash used in investing activities	(27)		(28)		(82)		(79)
Cash Flows From Financing Activities:
Proceeds from issuance of long-term debt	—		1,198		—		1,198
Repayments of long-term debt	(1,100)		—		(1,109)		(3)
Payments of debt facility issuance and modification costs	—		(1)		—		(23)
Acquisition of treasury stock to cover stock award tax withholding	(6)		(7)		(39)		—
Preferred stock dividend payments	(8)		(6)		(20)		(18)
Cash dividend received from ADI in connection with the ADI Spin-Off	900		—		900		—
Cash paid to ADI in connection with the ADI Spin-Off	(20)		—		(20)		—
Other financing activities, net	1		11		3		13
Net cash (used in) provided by continuing operations financing activities	(233)		1,195		(285)		1,167
Net cash used in discontinued operations financing activities	(454)		(3)		(60)		(8)
Net cash (used in) provided by financing activities	(687)		1,192		(345)		1,159
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	(6)		(1)		(9)		9
Net decrease in cash, cash equivalents and restricted cash	(719)		(408)		(432)		(347)
Cash, cash equivalents and restricted cash at beginning of period	949		754		662		693
Less: cash, cash equivalents and restricted cash of discontinued operations	—		93		—		93
Cash, cash equivalents and restricted cash of continuing operations at end of period	$         230		$         253		$         230		$         253

 

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE (UNAUDITED)
	Three Months Ended				Nine Months Ended
(in millions, except per share data)	October 3, 2026		September 27, 2025		October 3, 2026		September 27, 2025
GAAP Net income (loss) from continuing operations	$           31		$           90		$          170		$         (735)
Less: preferred stock dividends	6		6		18		18
Less: undistributed income allocated to preferred stockholders	3		9		17		—
GAAP Net income (loss) from continuing operations  available to common stockholders	$           22		$           75		$          135		$         (753)
Indemnification Agreement expense (1)	—		—		—		972
One-time tax impact of Indemnification Agreement	—		(34)		—		(78)
Termination of the Honeywell Tax Matters Agreement (2)	—		—		(33)		—
Intangible asset amortization	6		7		19		21
Business separation costs	30		—		30		—
Restructuring, impairment and extinguishment costs	20		3		43		4
Stock-based compensation expense	10		10		30		30
Litigation settlement	—		—		18		—
Undistributed income allocated to preferred stockholders	3		9		17		—
Other (3)	4		6		(1)		24
Tax effect of applicable non-GAAP adjustments (4)	(15)		(7)		(32)		(20)
Adjusted Net income	$           80		$           69		$          226		$          200
Non-recurring standalone adjustments, net of taxes (5)	—		5		5		14
Standalone Adjusted Net Income From Continuing Operations	$           80		$           74		$          231		$          214
	Three Months Ended				Nine Months Ended
	October 3, 2026		September 27, 2025		October 3, 2026		September 27, 2025
Net income (loss) from continuing operations available to common shareholders per diluted common share	$         0.14		$         0.49		$         0.88		$        (4.99)
Indemnification Agreement expense (1)	—		—		—		6.44
One-time tax impact of Indemnification Agreement	—		(0.22)		—		(0.52)
Termination of the Honeywell Tax Matters Agreement (2)	—		—		(0.21)		—
Intangible asset amortization	0.04		0.05		0.12		0.14
Business separation costs	0.19		—		0.19		—
Restructuring, impairment and extinguishment costs	0.13		0.02		0.28		0.03
Stock-based compensation expense	0.06		0.06		0.19		0.20
Litigation settlement	—		—		0.12		—
Undistributed income allocated to preferred stockholders	0.02		0.06		0.11		—
Other (3)	0.03		0.04		(0.01)		0.16
Tax effect of applicable non-GAAP adjustments (4)	(0.09)		(0.05)		(0.21)		(0.13)
Adjusted Diluted Earnings Per Share	$         0.52		$         0.45		$         1.46		$         1.33
Non-recurring standalone adjustments, net of taxes  (5)	—		0.03		0.04		0.09
Standalone Adjusted Diluted Earnings Per Share	$         0.52		$         0.48		$         1.50		$         1.42

(1)	Refer to the Unaudited Consolidated Statements of Operations herein.
(2)	We recognized a gain of $77 million in Other income and derecognized $44 million of deferred tax assets that were no longer realizable to Income tax expense in connection with the termination of the Honeywell Tax Matters Agreement.
(3)	Other includes net periodic pension benefit costs, excluding service costs, foreign exchange transaction loss (income), gain on sale of assets and miscellaneous other non-recurring, non-operating income and loss.
(4)	We calculate the tax effect of relevant non-GAAP adjustments by applying a flat statutory tax rate of 25% for all non-deductible and taxable adjustments.
(5)	Reflects methodology differences between continuing operations basis of accounting and Standalone results (e.g., executive compensation for certain executives who transferred to ADI as part of the separation or retired from Resideo is wholly retained in continuing operations). Standalone results are intended to present historical results as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented.

 

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS GAAP NET INCOME AND ADJUSTED EBITDA (UNAUDITED)
	Three Months Ended				Nine Months Ended
(in millions)	October 3, 2026		September 27, 2025		October 3, 2026		September 27, 2025
Revenue	$         727		$         703		$       2,217		$       2,108
GAAP Net income (loss) from continuing operations	$          31		$          90		$         170		$        (735)
GAAP Net income (loss) from continuing operations as a % of revenue	4.3 %		12.8 %		7.7 %		(34.9) %
Provision (benefit) for income taxes	7		(20)		88		(22)
GAAP Net income (loss) from continuing operations before taxes	38		70		258		(757)
Indemnification Agreement expense (1)	—		—		—		972
Termination of Honeywell Tax Matters Agreement (2)	—		—		(77)		—
Interest expense, net	31		30		97		81
Depreciation and amortization	21		21		64		60
Business separation costs	30		—		30		—
Stock-based compensation expense	10		10		30		30
Restructuring, impairment and extinguishment costs	20		3		43		4
Litigation settlement	—		—		18		—
Other (3)	4		6		(1)		24
Adjusted EBITDA	$         154		$         140		$         462		$         414
Non-recurring standalone adjustments (4)	—		6		7		19
Standalone Adjusted EBITDA	$         154		$         146		$         469		$         433
Standalone Adjusted EBITDA as a % of revenue	21.2 %		20.8 %		21.2 %		20.5 %

(1)	Refer to the Unaudited Consolidated Statements of Operations herein.
(2)	We recognized a gain of $77 million in Other income and derecognized $44 million of deferred tax assets that were no longer realizable to Income tax expense in connection with the termination of the Honeywell Tax Matters Agreement.
(3)	Other includes net periodic pension benefit costs, excluding service costs, foreign exchange transaction loss (income), gain on sale of assets and miscellaneous other non-recurring, non-operating income and loss.
(4)	Reflects methodology differences between continuing operations basis of accounting and Standalone results (e.g., executive compensation for certain executives who transferred to ADI as part of the separation or retired from Resideo is wholly retained in continuing operations). Standalone results are intended to present historical results as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented.

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended July 4, 2026 (UNAUDITED)
		For the Three Months Ended July 4, 2026
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,981		$             1,243		$              738
Cost of goods sold		1,386		951		435
Gross profit		595		292		303
Operating expenses:
Research and development expenses		48		12		36
Selling, general and administrative expenses		332		196		136
Intangible asset amortization		31		25		6
Restructuring, impairment and extinguishment costs		22		5		17
Business separation costs		31		31		—
Total operating expenses		464		269		195
Income from operations		131		23		108
Other expense (income), net		(81)		2		(83)
Interest expense, net		46		13		33
Net income before taxes		166		8		158
Provision for income taxes		69		7		62
Net income		97		1		96
Less: preferred stock dividends		8		2		6
Less: undistributed income allocated to preferred stockholders		10		—		10
Net income (loss) available to common stockholders		$                79		$                 (1)		$                80

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended April 4, 2026 (UNAUDITED)
		For the Three Months Ended April 4, 2026
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,912		$             1,160		$              752
Cost of goods sold		1,361		904		457
Gross profit		551		256		295
Operating expenses:
Research and development expenses		48		11		37
Selling, general and administrative expenses		340		190		150
Intangible asset amortization		31		24		7
Restructuring, impairment and extinguishment costs		6		—		6
Business separation costs		24		24		—
Total operating expenses		449		249		200
Income from operations		102		7		95
Interest expense, net		47		14		33
Net income (loss) before taxes		55		(7)		62
Provision (benefit) for income taxes		17		(2)		19
Net income (loss)		38		(5)		43
Less: preferred stock dividends		9		3		6
Less: undistributed income allocated to preferred stockholders		3		(1)		4
Net income (loss) available to common stockholders		$                26		$                 (7)		$                33

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended December 31, 2025 (UNAUDITED)
		For the Three Months Ended December 31, 2025
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,895		$             1,145		$              750
Cost of goods sold		1,335		877		458
Gross profit		560		268		292
Operating expenses:
Research and development expenses		47		10		37
Selling, general and administrative expenses		321		183		138
Intangible asset amortization		31		25		6
Restructuring, impairment and extinguishment costs		7		3		4
Business separation costs		14		14		—
Total operating expenses		420		235		185
Income from operations		140		33		107
Other income, net		(65)		(2)		(63)
Interest expense, net		49		16		33
Net income before taxes		156		19		137
Provision (benefit) for income taxes		20		(22)		42
Net income		136		41		95
Less: preferred stock dividends		9		3		6
Less: undistributed income allocated to preferred stockholders		14		4		10
Net income available to common stockholders		$               113		$                34		$                79

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended September 27, 2025 (UNAUDITED)
		For the Three Months Ended September 27, 2025
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,864		$             1,161		$              703
Cost of goods sold		1,308		889		419
Gross profit		556		272		284
Operating expenses:
Research and development expenses		44		11		33
Selling, general and administrative expenses		320		185		135
Intangible asset amortization		31		24		7
Restructuring, impairment and extinguishment costs		3		—		3
Business separation costs		4		4		—
Total operating expenses		402		224		178
Income from operations		154		48		106
Other expense, net		7		1		6
Interest expense, net		37		7		30
Net income before taxes		110		40		70
Provision (benefit) for income taxes		(46)		(26)		(20)
Net income		156		66		90
Less: preferred stock dividends		9		3		6
Less: undistributed income allocated to preferred stockholders		16		7		9
Net income available to common stockholders		$               131		$                56		$                75

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended June 28, 2025 (UNAUDITED)
		For the Three Months Ended June 28, 2025
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,943		$             1,233		$              710
Cost of goods sold		1,374		949		425
Gross profit		569		284		285
Operating expenses:
Research and development expenses		41		9		32
Selling, general and administrative expenses		319		183		136
Intangible asset amortization		30		23		7
Restructuring, impairment and extinguishment costs		2		1		1
Total operating expenses		392		216		176
Income from operations		177		68		109
Indemnification Agreement expense		882		—		882
Other expense (income), net		9		(2)		11
Interest expense, net		24		(1)		25
Net income (loss) before taxes		(738)		71		(809)
Provision for income taxes		87		83		4
Net loss		(825)		(12)		(813)
Less: preferred stock dividends		8		2		6
Net loss available to common stockholders		$              (833)		$               (14)		$             (819)

 

Unaudited Condensed Consolidated Statement of Operations For the Three Months Ended March 29, 2025 (UNAUDITED)
		For the Three Months Ended March 29, 2025
		Resideo		ADI Discontinued Operations		Resideo Continuing Operations
(in millions)
Revenue		$             1,770		$             1,075		$              695
Cost of goods sold		1,259		833		426
Gross profit		511		242		269
Operating expenses:
Research and development expenses		35		9		26
Selling, general and administrative expenses		306		174		132
Intangible asset amortization		30		23		7
Restructuring, impairment and extinguishment costs		4		4		—
Total operating expenses		375		210		165
Income from operations		136		32		104
Indemnification Agreement expense		90		—		90
Other expense, net		6		—		6
Interest expense, net		25		(1)		26
Net income (loss) before taxes		15		33		(18)
Provision (benefit) for income taxes		9		15		(6)
Net income (loss)		6		18		(12)
Less: preferred stock dividends		9		3		6
Net income (loss) available to common stockholders		$                 (3)		$                15		$               (18)

 

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS ADJUSTED EBITDA (UNAUDITED)
	For the Three Months Ended
(in millions)	March 29, 2025	June 28, 2025	September 27, 2025	December 31, 2025	April 4, 2026	July 4, 2026	October 3, 2026
Net Income (loss) from continuing operations	$             (12)	$         (813)	$                   90	$                  95	$           43	$         96	$              31
Provision (benefit) for income taxes	(6)	4	(20)	42	19	62	7
Interest expense, net	26	25	30	33	33	33	31
Depreciation and amortization	19	20	21	20	22	21	21
Stock-based compensation expense	11	9	10	10	10	10	10
Restructuring, impairment and extinguishment costs	—	1	3	4	6	17	20
Business separation costs	—	—	—	—	—	—	30
Litigation Settlement	—	—	—	—	18	—	—
Indemnification Agreement expense	90	882	—	—	—	—	—
Termination of Honeywell Tax Matters Agreement	—	—	—	—	—	(77)	—
Gain on sale of business	—	—	—	(52)	—	—	—
Other (1)	6	12	6	(10)	1	(6)	4
Adjusted EBITDA	$             134	$          140	$                 140	$                 142	$         152	$        156	$             154
Non-recurring standalone adjustments (2)	5	8	6	6	6	1	—
Standalone Adjusted EBITDA	$             139	$          148	$                 146	$                 148	$         158	$        157	$             154

(1)	Other includes net periodic pension benefit costs, excluding service costs, foreign exchange transaction loss (income), gain on sale of assets and miscellaneous other non-recurring, non-operating income and loss.
(2)	Reflects methodology differences between continuing operations basis of accounting and Standalone results (e.g., executive compensation for certain executives who transferred to ADI as part of the separation or retired from Resideo is wholly retained in continuing operations). Standalone results are intended to present historical results as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented.

 

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE (UNAUDITED)
	For the Three Months Ended
(in millions)	March 29, 2025	June 28, 2025	September 27, 2025	December 31, 2025	April 4, 2026	July 4, 2026	October 3, 2026
Net income (loss) from continuing operations available to common stockholders	$             (18)	$          (819)	$                   75	$                   79	$           33	$          80	$               22
Intangible asset amortization	7	7	7	6	7	6	6
Stock-based compensation expense	11	9	10	10	10	10	10
Restructuring, impairment and extinguishment costs	—	1	3	4	6	17	20
Business separation costs	—	—	—	—	—	—	30
Litigation Settlement	—	—	—	—	18	—	—
Indemnification Agreement expense	90	882	—	—	—	—	—
Tax impact of terminating the IRA	—	(44)	(34)	6	—	—	—
Termination of Honeywell Tax Matters Agreement	—	—	—	—	—	(77)	—
Tax impact of terminating the Honeywell Tax Matters Agreement	—	—	—	—	—	44	—
Gain on sale of business	—	—	—	(52)	—	—	—
Tax impact of sale of business	—	—	—	14	—	—	—
Undistributed income allocated to preferred stockholders	—	—	9	10	4	10	3
Other (1)	6	12	6	(10)	1	(6)	4
Tax effect of applicable non-GAAP adjustments	(6)	(7)	(7)	(3)	(11)	(7)	(15)
Adjusted Net Income	$               90	$            41	$                   69	$                   64	$           68	$          77	$               80
Non-recurring standalone adjustments, net of taxes (2)	4	6	5	5	5	1	—
Standalone Adjusted Net Income	$               94	$            47	$                   74	$                   69	$           73	$          78	$               80
Diluted shares (in millions)	148	151	154	155	155	154	154
Standalone Adjusted Diluted Earnings Per Share	$             0.64	$          0.31	$                  0.48	$                 0.45	$         0.47	$        0.51	$             0.52

(1)	Other includes net periodic benefit costs, excluding service costs, foreign exchange transaction loss (income), gain on sale of assets and miscellaneous other non-recurring, non-operating income and loss.
(2)	Reflects methodology differences between continuing operations basis of accounting and Standalone results (e.g., executive compensation for certain executives who transferred to ADI as part of the separation or retired from Resideo is wholly retained in continuing operations). Standalone results are intended to present historical results as if the ADI Spin-Off had occurred and Resideo was operating as a separate, independent company for all periods presented.

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/resideo-announces-third-quarter-2026-financial-results-and-updates-2026-outlook-302935565.html

SOURCE Resideo Technologies, Inc.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Resideo's third-quarter 2026 revenue and earnings?

Resideo reported $727 million revenue, up 3% year over year, and GAAP income from continuing operations of $31 million, down 66%. GAAP diluted earnings per share from continuing operations fell 71% to $0.14. Standalone adjusted diluted earnings per share increased 8% to $0.52.

What is Resideo's updated full-year 2026 outlook?

Resideo expects revenue of $2,927–$2,947 million, standalone adjusted EBITDA of $614–$624 million and standalone adjusted earnings per share of $1.92–$1.98. Its full-year outlook also calls for cash provided by operating activities of at least $165 million.

How does Resideo define its standalone adjusted financial measures after the ADI spin-off?

Resideo's standalone adjusted measures present results as if the ADI spin-off had occurred and Resideo had operated as a separate, independent company for all periods presented. These supplemental non-GAAP measures include standalone adjusted EBITDA, standalone adjusted net income and standalone adjusted diluted earnings per share.

Why did Resideo's third-quarter 2026 continuing operating cash flow improve?

The improvement primarily reflected the $1.59 billion payment to Honeywell in the third quarter of 2025 to terminate the Indemnification Agreement. Continuing operations provided $33 million of operating cash in the third quarter of 2026, compared with $1.59 billion used a year earlier.

When did Resideo complete the ADI spin-off, and how is ADI reported?

Resideo completed the ADI spin-off on August 3, 2026, distributing all issued and outstanding ADI common stock to Resideo common shareholders on a pro rata basis. Historical ADI results are presented as discontinued operations in Resideo's financial statements.