[10-Q] ADT Inc. Quarterly Earnings Report

Rhea-AI Filing Summary

ADT Inc. reported solid Q3 2025 results, driven by recurring monitoring revenue and higher installation activity. Total revenue was $1,297,954,000, up from $1,243,836,000 a year ago. Operating income was $315,073,000 and net income reached $145,132,000, compared to $127,151,000 last year. Diluted EPS was $0.16 for the quarter. Year to date, revenue totaled $3,852,480,000 and net income was $450,557,000.

Interest expense fell to $112,617,000 in Q3 from $161,830,000, reflecting refinancing actions and interest rate risk management. Cash from operations for the nine months was $1,510,585,000. The company continued portfolio simplification: it classified its multifamily business as held for sale at quarter-end and closed the sale on October 1, 2025 for approximately $56,000,000. ADT executed multiple debt transactions in 2025, including issuing First Lien Term Loan B‑2 due 2032 and partial redemptions of 2026 notes, and subsequently issued $1,000,000,000 First Lien Notes due 2033 to redeem Second Lien Notes due 2028. The board declared a $0.055 per‑share dividend payable January 8, 2026.

Insights

Credit & Capital Structure Analyst

Debt mix improved; interest costs eased alongside robust cash flow.

ADT used term loans and secured notes to refinance nearer maturities and reduce interest volatility. Q3 interest expense was $112,617,000 versus $161,830,000 last year, helped by 2025 actions including the First Lien Term Loan B‑2 due 2032 and partial redemptions of 2026 notes.

Subsequently, the company issued $1,000,000,000 First Lien Notes due 2033 and redeemed Second Lien Notes due 2028. New swaps increased hedging to a total notional of $5,150,000,000 at quarter-end, with further derivatives executed in October 2025, aligning interest profile with floating-rate exposure.

Operating cash flow of $1,510,585,000 for the nine months supports debt service and capital returns. Actual impact depends on execution of remaining redemptions and rate movements disclosed in later filings.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 FORM 10-Q

(Mark One)
☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2025

OR

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________

Commission File Number: 001-38352

ADT Inc.

(Exact name of registrant as specified in its charter)

Delaware						47-4116383
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

1501 Yamato Road

Boca Raton, Florida 33431

(561) 988-3600

(Address of principal executive offices, zip code, registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

ADT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes x   No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes x  No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of October 28, 2025, there were 765,018,211 shares outstanding of the registrant’s common stock, $0.01 par value per share, and 54,744,525 shares outstanding of the registrant’s Class B common stock, $0.01 par value per share.

TABLE OF CONTENTS

						Page
Part I			Financial Information
Item 1.			Financial Statements			1
			Condensed Consolidated Balance Sheets (Unaudited)			1
			Condensed Consolidated Statements of Operations (Unaudited)			2
			Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)			3
			Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)			4
			Condensed Consolidated Statements of Cash Flows (Unaudited)			6
			Notes to Condensed Consolidated Financial Statements (Unaudited)
			1. Description of Business and Summary of Significant Accounting Policies			7
			2. Revenue and Receivables			11
			3. Segment Information			13
			4. Divestitures			14
			5. Goodwill and Other Intangible Assets			16
			6. Debt			17
			7. Derivative Financial Instruments			19
			8. Income Taxes			21
			9. Equity			22
			10. Share-Based Compensation			23
			11. Earnings Per Share			24
			12. Commitments and Contingencies			25
			13. Leases			27
			14. Related Party Transactions			28
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			30
Item 3.			Quantitative and Qualitative Disclosures About Market Risk			43
Item 4.			Controls and Procedures			44
Part II			Other Information
Item 1.			Legal Proceedings			45
Item 1A.			Risk Factors			45
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			45
Item 3.			Defaults Upon Senior Securities			45
Item 4.			Mine Safety Disclosures			46
Item 5.			Other Information			46
Item 6.			Exhibits			46
Signatures						48

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share and per share data)

			September 30, 2025						December 31, 2024
Assets
Current assets:
Cash and cash equivalents			$	62,806					$	96,212
Restricted cash and restricted cash equivalents			108,228						107,853
Accounts receivable, net of allowance for credit losses of $77,330 and $57,795, respectively			400,437						393,511
Inventories, net			190,436						196,731
Prepaid expenses and other current assets			226,079						210,613
Total current assets			987,986						1,004,920
Property and equipment, net			240,810						247,183
Subscriber system assets, net			2,836,081						2,981,161
Intangible assets, net			4,867,486						4,854,099
Goodwill			4,885,574						4,903,899
Deferred subscriber acquisition costs, net			1,425,381						1,324,376
Other assets			737,875						735,319
Total assets			$	15,981,193					$	16,050,957
Liabilities and stockholders' equity
Current liabilities:
Current maturities of long-term debt			$	521,725					$	195,791
Accounts payable			166,884						153,537
Deferred revenue			247,483						247,785
Accrued expenses and other current liabilities			517,124						634,904
Current liabilities of discontinued operations			24,359						31,763
Total current liabilities			1,477,575						1,263,780
Long-term debt			7,284,108						7,511,282
Deferred subscriber acquisition revenue			2,087,721						2,067,608
Deferred tax liabilities			1,181,410						1,167,213
Other liabilities			281,991						224,384
Noncurrent liabilities of discontinued operations			9,604						15,889
Total liabilities			12,322,409						12,250,156
Commitments and contingencies (See Note 12)
Stockholders' equity:
Preferred stock—authorized 1,000,000 shares of $0.01 par value; zero issued and outstanding as of September 30, 2025 and December 31, 2024			—						—
Common stock—authorized 3,999,000,000 shares of $0.01 par value; issued and outstanding shares of 764,979,025 and 836,589,761 as of September 30, 2025 and December 31, 2024, respectively			7,650						8,366
Class B common stock—authorized 100,000,000 shares of $0.01 par value; issued and outstanding shares of 54,744,525 as of September 30, 2025 and December 31, 2024			547						547
Additional paid-in capital			6,666,054						7,117,098
Accumulated deficit			(3,007,138)						(3,318,174)
Accumulated other comprehensive income (loss)			(8,329)						(7,036)
Total stockholders' equity			3,658,784						3,800,801
Total liabilities and stockholders' equity			$	15,981,193					$	16,050,957

See Notes to Condensed Consolidated Financial Statements

1

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per share data)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2025						2024						2025						2024
Revenue:
Monitoring and related services			$	1,097,561					$	1,077,550					$	3,270,906					$	3,208,267
Security installation, product, and other			200,393						166,286						581,574						429,800
Total revenue			1,297,954						1,243,836						3,852,480						3,638,067
Cost of revenue (exclusive of depreciation and amortization shown separately below):
Monitoring and related services			161,788						154,744						481,566						460,649
Security installation, product, and other			88,922						67,362						259,452						151,996
Total cost of revenue			250,710						222,106						741,018						612,645
Selling, general, and administrative expenses			384,353						360,110						1,109,091						1,120,617
Depreciation and intangible asset amortization			347,818						335,270						1,026,069						1,002,131
Operating income (loss)			315,073						326,350						976,302						902,674
Interest expense, net			(112,617)						(161,830)						(349,294)						(358,980)
Other income (expense)			(3,835)						17,735						(7,896)						44,907
Income (loss) from continuing operations before income taxes			198,621						182,255						619,112						588,601
Income tax benefit (expense)			(55,109)						(50,235)						(164,890)						(166,505)
Income (loss) from continuing operations			143,512						132,020						454,222						422,096
Income (loss) from discontinued operations, net of tax			1,620						(4,869)						(3,665)						(111,000)
Net income (loss)			$	145,132					$	127,151					$	450,557					$	311,096
Common Stock:
Income (loss) from continuing operations per share - basic			$	0.18					$	0.15					$	0.54					$	0.46
Income (loss) from continuing operations per share - diluted			$	0.17					$	0.14					$	0.51					$	0.44
Net income (loss) per share - basic			$	0.18					$	0.14					$	0.54					$	0.34
Net income (loss) per share - diluted			$	0.16					$	0.13					$	0.50					$	0.32
Weighted-average shares outstanding - basic			764,742						850,462						783,310						851,539
Weighted-average shares outstanding - diluted			828,448						912,861						846,495						913,296
Class B Common Stock:
Income (loss) from continuing operations per share - basic			$	0.18					$	0.15					$	0.54					$	0.46
Income (loss) from continuing operations per share - diluted			$	0.17					$	0.14					$	0.51					$	0.44
Net income (loss) per share - basic			$	0.18					$	0.14					$	0.54					$	0.34
Net income (loss) per share - diluted			$	0.16					$	0.13					$	0.50					$	0.32
Weighted-average shares outstanding - basic			54,745						54,745						54,745						54,745
Weighted-average shares outstanding - diluted			54,745						54,745						54,745						54,745

See Notes to Condensed Consolidated Financial Statements

2

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(in thousands)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2025						2024						2025						2024
Net income (loss)			$	145,132					$	127,151					$	450,557					$	311,096
Other comprehensive income (loss), net of tax:
Cash flow hedges and other			(1,379)						1,430						(1,293)						4,665
Comprehensive income (loss)			$	143,753					$	128,581					$	449,264					$	315,761

See Notes to Condensed Consolidated Financial Statements

3

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(in thousands)

			Three Months Ended September 30, 2025
			Number of Common Shares						Number of Class B Common Shares						Common Stock						Class B Common Stock						Additional Paid-In Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
Beginning balance			777,957						54,745						$	7,780					$	547					$	6,764,716					$	(3,106,714)					$	(6,950)					$	3,659,379
Net income (loss)			—						—						—						—						—						145,132						—						145,132
Other comprehensive income (loss), net of tax			—						—						—						—						—						—						(1,379)						(1,379)
Dividends			—						—						—						—						—						(45,091)						—						(45,091)
Share-based compensation expense			—						—						—						—						10,716						—						—						10,716
Repurchases of common stock (including excise tax)			(13,399)						—						(134)						—						(111,373)						—						—						(111,507)
Transactions related to employee share-based compensation plans and other			421						—						4						—						1,995						(465)						—						1,534
Ending balance			764,979						54,745						$	7,650					$	547					$	6,666,054					$	(3,007,138)					$	(8,329)					$	3,658,784

			Three Months Ended September 30, 2024
			Number of Common Shares						Number of Class B Common Shares						Common Stock						Class B Common Stock						Additional Paid-In Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
Beginning balance			857,053						54,745						$	8,571					$	547					$	7,347,061					$	(3,535,042)					$	(12,927)					$	3,808,210
Net income (loss)			—						—						—						—						—						127,151						—						127,151
Other comprehensive income (loss), net of tax			—						—						—						—						—						—						1,430						1,430
Dividends			—						—						—						—						—						(50,157)						—						(50,157)
Share-based compensation expense			—						—						—						—						9,942						—						—						9,942
Transactions related to employee share-based compensation plans and other			197						—						2						—						1,238						(531)						—						709
Ending balance			857,250						54,745						$	8,573					$	547					$	7,358,241					$	(3,458,579)					$	(11,497)					$	3,897,285

See Notes to Condensed Consolidated Financial Statements

4

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(in thousands)

			Nine Months Ended September 30, 2025
			Number of Common Shares						Number of Class B Common Shares						Common Stock						Class B Common Stock						Additional Paid-In Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
Beginning balance			836,590						54,745						$	8,366					$	547					$	7,117,098					$	(3,318,174)					$	(7,036)					$	3,800,801
Net income (loss)			—						—						—						—						—						450,557						—						450,557
Other comprehensive income (loss), net of tax			—						—						—						—						—						—						(1,293)						(1,293)
Dividends			—						—						—						—						—						(138,172)						—						(138,172)
Share-based compensation expense			—						—						—						—						42,886						—						—						42,886
Repurchases of common stock (including excise tax)			(78,200)						—						(782)						—						(505,342)						—						—						(506,124)
Transactions related to employee share-based compensation plans and other			6,589						—						66						—						11,412						(1,349)						—						10,129
Ending balance			764,979						54,745						$	7,650					$	547					$	6,666,054					$	(3,007,138)					$	(8,329)					$	3,658,784

			Nine Months Ended September 30, 2024
			Number of Common Shares						Number of Class B Common Shares						Common Stock						Class B Common Stock						Additional Paid-In Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
Beginning balance			867,432						54,745						$	8,674					$	547					$	7,413,305					$	(3,617,718)					$	(16,162)					$	3,788,646
Net income (loss)			—						—						—						—						—						311,096						—						311,096
Other comprehensive income (loss), net of tax			—						—						—						—						—						—						4,665						4,665
Dividends			—						—						—						—						—						(150,375)						—						(150,375)
Share-based compensation expense			—						—						—						—						39,329						—						—						39,329
Repurchases of common stock (including excise tax)			(15,000)						—						(150)						—						(93,969)						—						—						(94,119)
Transactions related to employee share-based compensation plans and other			4,818						—						49						—						(424)						(1,582)						—						(1,957)
Ending balance			857,250						54,745						$	8,573					$	547					$	7,358,241					$	(3,458,579)					$	(11,497)					$	3,897,285

See Notes to Condensed Consolidated Financial Statements

5

ADT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

			Nine Months Ended September 30,
			2025						2024
Cash flows from operating activities:
Net income (loss)			$	450,557					$	311,096
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and intangible asset amortization			1,026,087						1,004,003
Amortization of deferred subscriber acquisition costs			186,547						165,454
Amortization of deferred subscriber acquisition revenue			(268,494)						(257,538)
Share-based compensation expense			42,886						39,329
Deferred income taxes			46,332						87,652
Provision for losses on receivables and inventory			155,700						146,204
Loss on extinguishment of debt			11,241						4,509
Goodwill, intangible, and other asset impairments			15,094						21,296
Unrealized (gain) loss on interest rate swap contracts			57,206						61,128
Other non-cash items, net			53,072						49,425
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
Deferred subscriber acquisition costs			(287,979)						(271,029)
Deferred subscriber acquisition revenue			173,416						196,355
Other, net			(151,080)						(132,661)
Net cash provided by (used in) operating activities			1,510,585						1,425,223
Cash flows from investing activities:
Dealer generated customer accounts and bulk account purchases			(487,912)						(473,560)
Subscriber system asset expenditures			(307,343)						(406,521)
Purchases of property and equipment			(125,695)						(130,114)
Proceeds (payments) from divestiture of businesses			—						(21,000)
Proceeds (payments) from interest rate swaps			(2,030)						(6,675)
Other investing, net			1,995						3,506
Net cash provided by (used in) investing activities			(920,985)						(1,034,364)
Cash flows from financing activities:
Proceeds from long-term borrowings			1,339,500						970,521
Repayment of long-term borrowings, including call premiums			(1,277,681)						(1,087,658)
Proceeds from receivables facility			206,910						189,861
Repayment of receivables facility			(173,720)						(202,747)
Proceeds (payments) from interest rate swaps			51,228						72,249
Repurchases of common stock, including excise tax			(606,767)						(93,356)
Dividends on common stock			(141,800)						(132,214)
Payments on finance leases			(20,576)						(23,069)
Other financing, net			275						(9,647)
Net cash provided by (used in) financing activities			(622,631)						(316,060)
Cash and cash equivalents and restricted cash and restricted cash equivalents:
Net increase (decrease)			(33,031)						74,799
Beginning balance			204,065						129,950
Ending balance			$	171,034					$	204,749

See Notes to Condensed Consolidated Financial Statements

6

Table of Contents

ADT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.     DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business and Organization

ADT Inc., together with its wholly-owned subsidiaries (collectively, “ADT” or the “Company”), provides security, interactive, and smart home solutions to consumer and small business customers in the United States (“U.S.”).

As of September 30, 2025, certain entities managed by affiliates of Apollo Global Management, Inc. (“Apollo”) owned approximately 12.4% of the Company’s outstanding Common Stock, including shares of Class B common stock (“Class B Common Stock”) (on an as-converted basis). Refer to Note 14 “Related Party Transactions” for further information.

Basis of Presentation

The condensed consolidated financial statements included herein:

•have been prepared in U.S. dollars in accordance with generally accepted accounting principles in the United States of America (“GAAP”);

•are comprised of the consolidated results of ADT Inc. and its wholly-owned subsidiaries for which all intercompany transactions have been eliminated;

•are unaudited, but in the opinion of management, include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company’s financial position, results of operations, and cash flows for the interim periods presented; and

•should not be taken as indicative of results that may be expected for future interim periods or the full year.

The Condensed Consolidated Balance Sheet as of December 31, 2024 included herein was derived from the audited consolidated financial statements as of that date included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”). Certain information and footnote disclosures required in the annual consolidated financial statements have been omitted as appropriate. For a more comprehensive understanding of the Company and its interim results, these condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the 2024 Annual Report.

Certain prior period amounts have been reclassified to conform with the current period presentation. Beginning in the first quarter of 2025, amounts previously disclosed under the caption merger, restructuring, integration, and other are presented within selling, general, and administrative expenses (“SG&A”) in the Condensed Consolidated Statements of Operations as they are no longer material for the periods presented.

Use of Estimates

The preparation of these condensed consolidated financial statements in accordance with GAAP requires the Company to select accounting policies and make estimates that affect amounts reported in the condensed consolidated financial statements and the accompanying notes. The Company’s estimates are based on the relevant information available at the end of each period. Actual results could differ materially from these estimates under different assumptions or market conditions.

Segment Information

The Company evaluates and reports information based on the manner in which our chief operating decision maker (“CODM”) evaluates performance and allocates resources. The CODM manages the business on a consolidated basis, and as such, the Company reports results in a single operating and reportable segment.

Refer to Note 3 “Segment Information.”

7

Table of Contents

ADT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Discontinued Operations

The Company’s exit in 2024 from the residential solar business (the “Solar Business”) (the “ADT Solar Exit”) and the sale in 2023 of its commercial business (the “Commercial Business”) (the “Commercial Divestiture”) represented strategic shifts that had major effects on the Company’s operations and financial results. As applicable, the results of operations and financial position of these businesses are classified as discontinued operations in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets, respectively. The Condensed Consolidated Statements of Cash Flows and Condensed Consolidated Statements of Comprehensive Income (Loss) present both continuing and discontinued operations, as applicable.

Refer to Note 4 “Divestitures.”

Unless otherwise noted, the following Notes to Condensed Consolidated Financial Statements refer to the Company’s continuing operations only.

Accounting Standards Updates (“ASUs”)

Recently Issued

Targeted Improvements to the Accounting for Internal-Use Software - ASU 2025-06, Intangibles — Goodwill and Other (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, removes all references to prescriptive and sequential software development stages, requiring an entity to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended, as well as other evaluation and disclosure updates.

This guidance is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period.

The amendments in this ASU permit an entity to apply the new guidance using a prospective transition approach, a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption, and a retrospective transition approach. The Company is currently evaluating the impact of this guidance on its financial statements and disclosures.

Disaggregation of Income Statement Expenses - ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requires additional disclosure in the footnotes at each interim and annual reporting period about specific types of expenses included in the expense captions presented on the face of the statement of operations as well as additional disclosures that also include information related to selling expenses.

The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial statements and disclosures.

Improvements to Income Tax Disclosures - ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, focuses on improvements to income tax disclosures, primarily related to the rate reconciliation and income tax paid information. In addition, the update includes certain other amendments to improve the effectiveness of income tax disclosures.

The guidance is effective for annual reporting periods beginning after December 15, 2024, and should be applied prospectively, with retrospective application also a permitted option. The Company is currently evaluating the impact of this guidance on its financial statements and disclosures and will include required disclosures in the Annual Report on Form 10-K for the year ended December 31, 2025.

Disclosure Improvements - ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, represents changes to clarify or improve disclosure and presentation requirements of a variety of topics.

The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company is monitoring the potential impact of this guidance on its financial statements and disclosures.

8

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ADT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Significant Accounting Policies

Unless otherwise noted, the Company’s accounting policies, including those presented herein, do not materially differ from those disclosed in the 2024 Annual Report.

Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents

The following table reconciles the amounts below reported in the Condensed Consolidated Balance Sheets to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows:

(in thousands)			September 30, 2025						December 31, 2024
Cash and cash equivalents			$	62,806					$	96,212
Restricted cash and restricted cash equivalents(1)			108,228						107,853
Ending balance			$	171,034					$	204,065

_______________

(1)    Primarily includes the Opportunity Fund in connection with the State Farm Development Agreement (both as defined and discussed in Note 14 “Related Party Transactions”). Use of the funds must be agreed to by State Farm Fire & Casualty Company (“State Farm”) and the Company. Substantially all of the balance of the Opportunity Fund was subsequently repaid to State Farm on October 24, 2025 in connection with the expiration of this agreement. The remaining restricted cash and restricted cash equivalents relate to the Company’s uncommitted receivables securitization financing agreement (the “2020 Receivables Facility”) (refer to Note 6 “Debt”).

Inventories, net

Inventories, net includes finished goods and work-in-progress. Work-in-progress is not material.

Subscriber System Assets, net and Deferred Subscriber Acquisition Costs, net

Subscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system, and which the Company may retrieve upon termination of the contract with the customer. Deferred subscriber acquisition costs represent selling expenses (primarily commissions) that are incremental to acquiring customers.

Subscriber system assets and any related deferred subscriber acquisition costs are accounted for on a pooled basis based on the month and year of customer acquisition. The Company depreciates and amortizes these pooled costs using an accelerated method over the estimated life of the customer relationship, which is 15 years.

(in thousands)			September 30, 2025						December 31, 2024
Gross carrying amount			$	7,055,660					$	6,878,490
Accumulated depreciation			(4,219,579)						(3,897,329)
Subscriber system assets, net			$	2,836,081					$	2,981,161

Depreciation of subscriber system assets and amortization of deferred subscriber acquisition costs are reflected in depreciation and intangible asset amortization and SG&A, respectively, as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Depreciation of subscriber system assets						$	137,881					$	139,704					$	416,082					$	417,313
Amortization of deferred subscriber acquisition costs						$	64,040					$	56,119					$	186,547					$	165,454

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ADT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Accrued Expenses and Other Current Liabilities

(in thousands)			September 30, 2025						December 31, 2024
Accrued interest			$	77,464					$	107,116
Payroll-related accruals			119,886						109,078
Opportunity Fund (see Note 14 “Related Party Transactions”)			81,643						84,516
Accrued dividends			44,973						48,918
Physically settled forward share repurchase liabilities (see Note 9 “Equity”)			—						104,175
Other accrued liabilities			193,158						181,101
Accrued expenses and other current liabilities			$	517,124					$	634,904

Fair Value of Financial Instruments

The Company’s financial instruments primarily consist of cash and cash equivalents, restricted cash and restricted cash equivalents, accounts receivable, retail installment contract receivables (“RICs”), accounts payable, debt, and derivatives. Due to their short-term and/or liquid nature, the fair values of cash, restricted cash, accounts receivable, and accounts payable approximate their respective carrying amounts.

Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents - Included in cash and cash equivalents and restricted cash and restricted cash equivalents, as applicable from time to time, are investments in money market mutual funds. These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted prices in active markets for identical assets or liabilities.

As of September 30, 2025 and December 31, 2024, investments in money market mutual funds were $50 million and $90 million, respectively.

Long-Term Debt Instruments - The fair values of the Company’s long-term debt instruments are determined using broker-quoted market prices, which represent quoted prices for similar assets or liabilities as well as other observable market data, and are classified as Level 2 fair value measurements. The carrying amounts of debt outstanding, if any, under the Company’s first lien revolving credit facility (the “First Lien Revolving Credit Facility”) and the 2020 Receivables Facility approximate their fair values as interest rates on these borrowings approximate current market rates. Refer to Note 6 “Debt.”

			September 30, 2025												December 31, 2024
(in thousands)			Carrying Amount						Fair Value						Carrying Amount						Fair Value
Long-term debt instruments(1) (see Note 6 “Debt”)			$	7,752,327					$	7,814,687					$	7,637,631					$	7,589,677

________________

(1)    Excludes finance leases.

Derivative Financial Instruments - Derivative financial instruments are reported at fair value as either assets or liabilities that are primarily calculated using discounted cash flow models utilizing observable inputs, such as quoted forward interest rates, and incorporate credit risk adjustments to reflect the risk of default by the counterparty or the Company. The resulting fair values are classified as Level 2 fair value measurements.

Refer to Note 7 “Derivative Financial Instruments” for the fair values of the Company’s derivative financial instruments.

Retail Installment Contract Receivables - The fair values of the Company’s RICs are determined using a discounted cash flow model and are classified as Level 3 fair value measurements. Refer to Note 2 “Revenue and Receivables.”

			September 30, 2025												December 31, 2024
(in thousands)			Carrying Amount						Fair Value						Carrying Amount						Fair Value
Retail installment contract receivables, net			$	653,970					$	507,400					$	669,326					$	495,259

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

2.     REVENUE AND RECEIVABLES

Revenue

The Company generates revenue from contractual monthly recurring fees received for monitoring and related services, as well as the sale and installation of security systems. The Company’s revenue-generating contracts are entered into primarily through its main operating entity and wholly-owned subsidiary, ADT LLC.

Disaggregated Revenue

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Sources of Revenue:
Recurring monthly revenue						$	1,059,904					$	1,045,152					$	3,169,230					$	3,122,223
Other related services						37,657						32,398						101,676						86,044
Monitoring and related services						1,097,561						1,077,550						3,270,906						3,208,267
Installation revenue						$	110,388					$	78,306					$	313,080					$	172,262
Amortization of deferred subscriber acquisition revenue						90,005						87,980						268,494						257,538
Security installation, product, and other						200,393						166,286						581,574						429,800
Total revenue						$	1,297,954					$	1,243,836					$	3,852,480					$	3,638,067

The Company allocates the transaction price to each performance obligation based on the relative standalone selling price, which is determined using observable internal and external pricing, profitability, and operational metrics.

Customer-Owned Transactions - In transactions involving security systems sold outright to the customer (referred to as outright sales), the Company’s performance obligations generally include the sale and installation of the security system, which is primarily recognized at a point in time based upon the nature of the transaction and contractual terms, and any monitoring and related services, which are recognized when these services are provided to the customer.

Company-Owned Transactions - In transactions in which the Company provides monitoring and related services but retains ownership of the security system, the Company’s performance obligations primarily include (i) monitoring and related services, which are recognized when these services are provided to the customer, and (ii) a material right associated with the one-time non-refundable fees in connection with the initiation of a monitoring contract which the customer will not be required to pay again upon a renewal of the contract (referred to as deferred subscriber acquisition revenue).

Deferred subscriber acquisition revenue is amortized on a pooled basis over the estimated life of the customer relationship using an accelerated method consistent with the treatment of subscriber system assets and deferred subscriber acquisition costs.

Remaining Performance Obligations

As of September 30, 2025, the Company’s total remaining unsatisfied performance obligations relating to the provision of monitoring and related services are as follows (in thousands):

0-12 Months						13-24 Months						25-36 Months						Thereafter						Total
$	1,901,357					$	1,052,430					$	498,703					$	261,187					$	3,713,677

Allowance for Credit Losses

The Company evaluates its allowance for credit losses on accounts receivable in pools based on customer type. For each customer pool, the allowance for credit losses is estimated based on the delinquency status of the underlying receivables and the related historical loss experience, as adjusted for current and expected future conditions, if applicable. The allowance for credit losses is not material for the individual pools of customers.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

			Nine Months Ended September 30,
(in thousands)			2025						2024
Beginning balance			$	57,795					$	46,850
Provision for credit losses			125,635						106,697
Write-offs, net of recoveries(1)			(106,100)						(89,552)
Ending balance			$	77,330					$	63,995

________________

(1)Recoveries were not material for the periods presented. As such, write-offs are presented net of recoveries.

Retail Installment Contract Receivables, Net

The Company’s RICs allow qualifying residential customers to pay the fees due at installation over a 12-, 24-, 36-, or 60-month interest-free period. The financing component is not significant.

Upon origination of a RIC, the Company utilizes external credit scores to assess customer credit quality and determine eligibility. Subsequent to origination, the Company monitors the delinquency status of the RICs as the key credit quality indicator. Delinquent billed RICs are not a material portion of the Company’s RICs.

The allowance for credit losses relates to RICs from outright sales transactions and is not material.

The following is a summary of unbilled retail installment contract receivables, net:

(in thousands)						September 30, 2025						December 31, 2024
Retail installment contract receivables, gross						$	686,489					$	678,174
Allowance for credit losses						(32,519)						(8,848)
Retail installment contract receivables, net						$	653,970					$	669,326
Balance Sheet Classification:
Accounts receivable, net						$	265,782					$	260,224
Other assets						388,188						409,102
Retail installment contract receivables, net						$	653,970					$	669,326

As of September 30, 2025 and December 31, 2024, RICs, net, for which the Company grants a security interest as collateral for borrowings under the 2020 Receivables Facility were $593 million and $575 million, respectively. Refer to Note 6 “Debt” for further discussion regarding the 2020 Receivables Facility.

Contract Assets

Contract assets represent the Company’s right to consideration in exchange for goods or services transferred to the customer. The contract asset is reclassified to accounts receivable as additional services are performed and billed, which is when the Company’s right to the consideration becomes unconditional.

The Company has the right to bill customers as services are provided over time, which generally occurs over the course of a 12-, 24-, 36-, or 60-month period as additional services are performed and billed. There is no significant financing component.

Gross contract assets recognized were not material for the periods presented.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(in thousands)						September 30, 2025						December 31, 2024
Contract assets, gross						$	65,581					$	46,031
Allowance for credit losses						(6,462)						(5,221)
Contract assets, net						$	59,119					$	40,810
Balance Sheet Classification:
Prepaid expenses and other current assets						$	28,576					$	19,164
Other assets						30,543						21,646
Contract assets, net						$	59,119					$	40,810

3.     SEGMENT INFORMATION

The Company reports results in a single operating and reportable segment.

The Company’s CODM is its Chairman, President, and Chief Executive Officer. The CODM evaluates performance and allocates resources on a consolidated basis using various measures primarily through reviews of operational performance packages, earnings releases, investor presentations, and the Company’s SEC filings, as well as through the approval of the Company’s annual budget and forecast.

The Company’s reported segment profit measure is net income (loss) as this measure is most consistent with the amounts included in the Condensed Consolidated Statements of Operations. In addition, segment assets reviewed by the CODM are reported on the Company’s Condensed Consolidated Balance Sheets as total assets.

The accounting policies of the Company’s reportable segment are the same as those of the Company.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following presents a reconciliation to the Company’s net income (loss) as reported in the Condensed Consolidated Statements of Operations and includes segment revenues, significant segment expenses that are regularly provided to or easily computed from information regularly provided to the CODM, other segment expenses, and adjustments to reconcile to net income (loss).

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Total segment revenue						$	1,297,954					$	1,243,836					$	3,852,480					$	3,638,067
Less significant segment expenses:
Customer service costs(1)						108,831						101,272						324,315						307,305
Maintenance costs(1)						52,957						53,472						157,251						153,344
Security installation, product, and other costs						88,922						67,362						259,452						151,996
Selling costs, including commissions(2)						47,598						45,958						138,760						145,133
Amortization of deferred subscriber acquisition costs(2)						64,040						56,119						186,547						165,454
Advertising costs(2)						35,022						32,730						75,210						84,613
Provision for credit losses(2)						50,932						41,509						150,252						125,479
Other general and administrative costs(2)						152,255						173,780						482,178						539,118
Share-based compensation(2)						10,716						10,107						42,886						39,466
Depreciation and intangible asset amortization						347,818						335,270						1,026,069						1,002,131
Interest expense						114,681						163,718						355,725						366,854
Income tax expense (benefit)						55,109						50,235						164,890						166,505
Total significant segment expenses						1,128,881						1,131,532						3,363,535						3,247,398
Less other segment items(3):
Other items in SG&A(2)						23,790						(93)						33,258						21,354
Other, net						1,771						(19,623)						1,465						(52,781)
Total other segment items						25,561						(19,716)						34,723						(31,427)
Reconciliation of profit or loss:
(Income) loss from discontinued operations, net of tax(4)						(1,620)						4,869						3,665						111,000
Net income (loss)						$	145,132					$	127,151					$	450,557					$	311,096

________________

(1)Included in monitoring and related services cost of revenue in the Condensed Consolidated Statements of Operations.

(2)Included in SG&A in the Condensed Consolidated Statements of Operations.

(3)Other segment items generally include other income and expenses, interest income, as well as certain other items included in SG&A that are not considered significant segment expenses. Interest income is not material for the periods presented.

(4)Represents activity related to the Commercial and Solar Businesses (as applicable during the periods), which are presented as discontinued operations.

4.    DIVESTITURES

ADT Solar Exit

As discussed in Note 1 “Description of Business and Summary of Significant Accounting Policies,” the Solar Business is presented as a discontinued operation in the Company’s Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets for all periods presented.

Exit charges incurred and paid were not material in 2025.

During the nine months ended September 30, 2024, the Company paid approximately $21 million associated with the ADT Solar Exit primarily related to employee separation and other restructuring costs.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

During the three months ended September 30, 2024, aggregate exit charges were not material. During the nine months ended September 30, 2024, the Company incurred aggregate exit charges of $88 million, which have been recognized within income (loss) from discontinued operations, net of tax related to (i) $34 million associated with the write-down and disposition of inventory and asset impairments, (ii) $29 million associated with the disposition of the then existing installation pipeline, (iii) $13 million associated with employee separation costs, and (iv) $11 million associated with contract termination and other charges.

The following reconciliations represent the major classes of line items of the Solar Business presented within discontinued operations. Cash flows related to discontinued operations were not significant during the nine months ended September 30, 2025 and September 30, 2024.

Balance Sheet Information

There were no material assets of discontinued operations as of September 30, 2025 and December 31, 2024.

(in thousands)						September 30, 2025						December 31, 2024
Current maturities of long-term debt						$	—					$	22
Accounts payable						4,980						6,953
Accrued expenses and other current liabilities						19,379						24,788
Total current liabilities of discontinued operations						24,359						31,763
Long-term debt						—						32
Other liabilities						9,604						15,857
Total liabilities of discontinued operations						$	33,963					$	47,652

Statements of Operations Information

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Revenue						$	—					$	65					$	—					$	21,360
Cost of revenue						(1,283)						1,091						1,305						62,450
Selling, general, and administrative expenses						(915)						3,919						3,042						93,837
Depreciation and intangible asset amortization						—						55						18						1,872
Other (income) and expense items						—						5						42						1,478
Income (loss) from discontinued operations before income taxes						2,198						(5,005)						(4,407)						(138,277)
Income tax benefit (expense)						(578)						475						1,162						35,851
Income (loss) from discontinued operations, net of tax						$	1,620					$	(4,530)					$	(3,245)					$	(102,426)

Commercial Divestiture

During the periods presented, activity reflected in discontinued operations, net of tax, relating to the Commercial Divestiture was not material.

During the nine months ended September 30, 2024, the Company paid the purchaser of the Commercial Business $21 million related to the settlement of post-closing adjustments.

In connection with the Commercial Divestiture, the Company entered into a Transition Services Agreement (the “Commercial TSA”). During the three and nine months ended September 30, 2025, Commercial TSA income was not material. During the three and nine months ended September 30, 2024, the Company recognized $14 million and $36 million, respectively, of Commercial TSA income, which is reflected in other income (expense) within continuing operations.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Multifamily Divestiture

On September 12, 2025, the Company entered into an Asset Purchase Agreement to sell substantially all of the assets and certain specified liabilities of its multifamily business (the “Multifamily Divestiture”). As a result, the disposal group was classified and reflected as held for sale in the Condensed Consolidated Balance Sheet as of September 30, 2025, including $58 million of other assets. The remaining balances were not material and are presented in prepaid expenses and other current assets, accrued expenses and other current liabilities, and other liabilities, as applicable.

Additionally, in connection with the classification of the disposal group as held for sale, the Company recorded various impairment charges and other adjustments as of September 30, 2025, which were not material. Refer to Note 5 “Goodwill and Other Intangible Assets.”

Subsequent event - On October 1, 2025, the Company completed the Multifamily Divestiture for a purchase price of approximately $56 million, subject to certain customary post-closing adjustments.

5.     GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

During the three months ended September 30, 2025, the Company recorded a goodwill impairment charge of $12 million in connection with the Multifamily Divestiture, which is reflected in SG&A, and reclassified the remaining $6 million of goodwill to held for sale. Refer to Note 4 “Divestitures.”

Other Intangible Assets

			September 30, 2025																		December 31, 2024
(in thousands)			Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount
Definite-lived intangible assets:
Contracts and related customer relationships			$	6,643,866					$	(3,871,930)					$	2,771,936					$	6,158,349					$	(3,464,926)					$	2,693,423
Dealer relationships			1,518,020						(756,641)						761,379						1,518,020						(697,324)						820,696
Other			199,973						(198,802)						1,171						209,773						(202,793)						6,980
Total definite-lived intangible assets			8,361,859						(4,827,373)						3,534,486						7,886,142						(4,365,043)						3,521,099
Indefinite-lived intangible assets:
Trade name			1,333,000						—						1,333,000						1,333,000						—						1,333,000
Intangible assets			$	9,694,859					$	(4,827,373)					$	4,867,486					$	9,219,142					$	(4,365,043)					$	4,854,099

    

The change in the net carrying amount of contracts and related customer relationships during the period was as follows:

(in thousands)
Balance as of December 31, 2024			$	2,693,423
Customer contract additions, net of dealer charge-backs(1)			487,183
Amortization			(408,670)
Balance as of September 30, 2025			$	2,771,936

________________

(1)     The weighted-average amortization period for customer contract additions was approximately 15 years.

Payments for customer contract additions under the Company’s authorized dealer program and from other third parties are reflected as dealer generated customer accounts and bulk account purchases on the Condensed Consolidated Statements of Cash Flows.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

During the nine months ended September 30, 2025, the Company completed multiple bulk customer account purchases for an aggregate contractual purchase price of $132 million, subject to reductions based on customer retention, and paid total cash at the closings of $115 million.

Definite-Lived Intangible Asset Amortization Expense

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Definite-lived intangible asset amortization expense						$	161,232					$	151,817					$	470,501					$	453,359

6.     DEBT

The Company’s debt is comprised of the following (in thousands):

Description						Issued						Maturity						Interest Rate(1)						Interest Payable						September 30, 2025						December 31, 2024
First Lien Term Loan B due 2030						10/13/2023						10/13/2030						Term SOFR +2.00%						Quarterly						$	1,969,209					$	1,984,090
First Lien Term Loan B-2 due 2032						3/7/2025						3/7/2032						Term SOFR +1.75%						Quarterly						1,145,622						—
First Lien Revolving Credit Facility						3/16/2018						10/1/2029						Term SOFR +2.00%						Quarterly						—						—
First Lien Notes due 2026						4/4/2019						4/15/2026						5.750%						3/15 and 9/15						300,000						1,350,000
First Lien Notes due 2027						8/20/2020						8/31/2027						3.375%						6/15 and 12/15						1,000,000						1,000,000
First Lien Notes due 2029						7/29/2021						8/1/2029						4.125%						2/1 and 8/1						1,000,000						1,000,000
Second Lien Notes due 2028						1/28/2020						1/15/2028						6.250%						1/15 and 7/15						1,300,000						1,300,000
ADT Notes due 2032						5/2/2016						7/15/2032						4.875%						1/15 and 7/15						728,016						728,016
ADT Notes due 2042						7/5/2012						7/15/2042						4.875%						1/15 and 7/15						21,896						21,896
2020 Receivables Facility(2)						3/5/2020						8/20/2030						Various						Monthly						441,090						407,901
Total debt principal, excluding finance leases																														7,905,833						7,791,903
Finance lease liabilities(3)																														53,506						69,442
Unamortized debt discount, net																														(21,007)						(12,081)
Unamortized deferred financing costs																														(25,696)						(26,990)
Unamortized purchase accounting fair value adjustment and other																														(106,803)						(115,201)
Total debt																														7,805,833						7,707,073
Current maturities of long-term debt, net of unamortized debt discount																														(521,725)						(195,791)
Long-term debt																														$	7,284,108					$	7,511,282

_________________

(1)    Interest rate as of September 30, 2025. Interest on the 2020 Receivables Facility is primarily based on the Secured Overnight Financing Rate (“SOFR”) +0.95% and Lender Cost of Funds +0.85%.

(2)    Maturity date for the 2020 Receivables Facility represents the final maturity date of current loans borrowed under the facility.

(3)    Refer to Note 13 “Leases” for additional information regarding the Company’s finance leases.

As of September 30, 2025, the Company was in compliance with all financial covenant and other maintenance tests for all of its debt obligations.

First Lien Credit Agreement

The Company’s first lien credit agreement, dated as of July 1, 2015 (together with subsequent amendments and restatements, the “First Lien Credit Agreement”), consists of term loans (the “First Lien Term Loan B due 2030” and “First Lien Term Loan B-2 due 2032” as defined below, together, the “First Lien Term Loan Bs”) and the First Lien Revolving Credit Facility.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

During the nine months ended September 30, 2025, the Company borrowed and repaid $198 million under the First Lien Revolving Credit Facility. As of September 30, 2025, the available borrowing capacity was $800 million.

During the nine months ended September 30, 2024, the Company borrowed and repaid $325 million under the First Lien Revolving Credit Facility.

Significant activity since December 31, 2024 is as follows:

•March 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of a new $600 million first lien seven-year term loan (the “First Lien Term Loan B-2 due 2032”) (subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness of Prime Security Services Borrower, LLC and its subsidiaries if, on such date, the aggregate principal amount of such indebtedness equals or exceeds $1 billion), and received net proceeds of $597 million. Loans under the First Lien Term Loan B-2 due 2032 are treated as a separate class from the existing loans under the First Lien Term Loan B due 2030. The First Lien Term Loan B-2 due 2032 requires scheduled quarterly amortization payments, which commenced on June 30, 2025, equal to 0.25% of the original principal amount of the First Lien Term Loan B-2 due 2032, with the remaining balance payable at maturity. The Company may make voluntary prepayments on the First Lien Term Loan B-2 due 2032 at any time prior to maturity at par, however, such prepayment will be subject to a 1.00% prepayment premium in the event of certain specified refinancing events during the first six months after the most recent amendment. Additionally, the Company used the net proceeds to redeem $500 million of the First Lien Notes due 2026.

•July 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $550 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $545 million. These incremental borrowings have the same terms as existing loans under the First Lien Term Loan B-2 due 2032. Additionally, the Company used the net proceeds and cash on hand to redeem $550 million of the First Lien Notes due 2026.

Debt issuance costs incurred as a result of the transactions above were not material during the period.

Other than as described above, the term loans under the amended and restated First Lien Credit Agreement continue to have the same terms as provided under the existing First Lien Credit Agreement, and the parties to the amended and restated First Lien Credit Agreement continue to have the same obligations set forth in the existing First Lien Credit Agreement.

Subsequent Events - In October 2025, the Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $300 million of incremental borrowings under the First Lien Term Loan B-2 due 2032. The Company used the proceeds to partially redeem the Second Lien Notes due 2028. Also in October 2025, the Company partially redeemed $200 million of the First Lien Term Loan B due 2030 with proceeds from the Term Loan A due 2030.

Term Loan A due 2030

Subsequent event - In October 2025, the Company entered into a term loan credit agreement for an aggregate principal amount of $325 million of term loans under a senior secured term loan A facility (the “Term Loan A due 2030”). The Company used a portion of the proceeds to redeem $200 million of the First Lien Term Loan B due 2030 and intends to use the remaining proceeds for additional debt redemption.

First Lien Notes due 2033

Subsequent event - In October 2025, the Company issued $1 billion aggregate principal amount of 5.875% first-priority senior secured notes due 2033 (the “First Lien Notes due 2033”). The Company used the proceeds to redeem the majority of the Second Lien Notes due 2028.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

First Lien Notes due 2026 Partial Redemptions

Significant activity since December 31, 2024 is as follows:

•March 2025 - The Company redeemed $500 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $506 million, which includes a make-whole payment, using proceeds from the Company’s March 2025 issuance of the First Lien Term Loan B-2 due 2032.

•July 2025 - The Company redeemed $550 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $554 million, which includes a make-whole payment, using proceeds from the Company’s July 2025 issuance of the First Lien Term Loan B-2 due 2032 and cash on hand.

Loss on extinguishment of debt was not material during the period.

Second Lien Notes due 2028 Redemption

Subsequent event - In October, 2025, the Company redeemed the Second Lien Notes due 2028, using proceeds from the First Lien Notes due 2033, incremental borrowings under the First Lien Term Loan B-2 due 2032, and cash on hand.

2020 Receivables Facility

Under the 2020 Receivables Facility, the Company obtains financing by selling or contributing certain RICs to the Company’s wholly-owned consolidated bankruptcy-remote special purpose entity (the “SPE”), which then grants a security interest in those RICs as collateral for cash borrowings.

Significant activity since December 31, 2024 is as follows:

•March 2025 - The Company amended the agreement governing the 2020 Receivables Facility to extend the uncommitted revolving period to March 2026, reduce the interest rate on outstanding borrowings, and increase the advance rate on pledged collateral.

As of September 30, 2025, the Company had an uncommitted available borrowing capacity under the 2020 Receivables Facility of approximately $109 million.

Variable Interest Entity

The SPE meets the definition of a variable interest entity for which the Company is the primary beneficiary as it has the power to direct the SPE’s activities and the obligation to absorb losses or the right to receive benefits of the SPE. As such, the Company consolidates the SPE’s assets, liabilities, and financial results of operations.

The SPE’s assets and liabilities primarily consist of a portion of the Company’s unbilled RICs, net, as discussed in Note 2 “Revenue and Receivables,” and borrowings under the 2020 Receivables Facility, as presented above.

The impact to the Condensed Consolidated Statements of Operations from the 2020 Receivables Facility was primarily due to the allowance for credit losses and interest expense.

7.     DERIVATIVE FINANCIAL INSTRUMENTS

The Company's derivative financial instruments primarily consist of interest rate swap contracts, which were entered into with the objective of managing exposure to variability in interest rates on the Company's debt. SOFR is the applicable benchmark for all of the Company's interest rate swap contracts. All interest rate swap contracts are reported at fair value in the Condensed Consolidated Balance Sheets.

For interest rate swap contracts that are:

•Not designated as cash flow hedges: Unrealized gains and losses are recognized in interest expense, net, and other income (expense) depending on the nature of the underlying that the swaps are economically hedging.

•Designated as cash flow hedges: Unrealized gains and losses are recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into interest expense, net, in the same period in which the related interest on debt affects earnings.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For interest rate swap contracts that have been de-designated as cash flow hedges and for which forecasted cash flows are:

•Probable or reasonably possible of occurring: Unrealized gains and losses previously recognized as a component of AOCI are reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the original maturity date of the related interest rate swap contracts.

•Probable of not occurring: Unrealized gains and losses previously recognized as a component of AOCI are immediately reclassified into interest expense, net.

The cash flows associated with certain of the Company’s interest rate swap contracts that were entered into with the intention of offsetting the economic overhedged position of a portion of the Company’s existing interest rate swaps are reflected as cash flows from investing activities.

The cash flows associated with certain of the Company’s interest rate swap contracts that included an other-than-insignificant financing element at inception are reflected as cash flows from financing activities.

The cash flows associated with certain of the Company’s interest rate swap contracts that are designated as cash flow hedges are reflected as cash flows from operating activities.

The Company’s derivative instruments were entered into with the objective of reducing the variability in future expected interest payments on a portion of the Company’s First Lien Term Loan Bs or their replacement. Derivative instruments designated as cash flow hedges were highly effective at inception and are expected to continue to be highly effective.

The Company’s interest rate swaps consist of the following (notional amounts in thousands):

Execution						Maturity						Designation						September 30, 2025						December 31, 2024
October 2019						September 2026						Not designated						$	2,800,000					$	2,800,000
March 2023						March 2028						Not designated						100,000						100,000
April 2023						March 2028						Not designated						200,000						200,000
December 2023						September 2026						Not designated						700,000						700,000
June 2025						March 2032						Cash flow hedge						550,000						—
July 2025						March 2032						Cash flow hedge						500,000						—
July 2025						March 2032						Not designated						100,000						—
September 2025						October 2030						Cash flow hedge						200,000						$	—
Total notional amount																		$	5,150,000					$	3,800,000

Subsequent event - During October 2025, the Company entered into derivative instruments with a notional amount of $1.7 billion with the objective of reducing the variability in future expected interest payments on a portion of the Company’s term loans under its First Lien Credit Agreement or their replacement.

Balance Sheet Classification (in thousands)						September 30, 2025						December 31, 2024
Prepaid expenses and other current assets						$	54,426					$	56,164
Other assets						1,250						54,102
Accrued expenses and other current liabilities						—						(1,466)
Other liabilities						(11,058)						(208)
Fair value of interest rate swaps - net asset (liability)						$	44,618					$	108,592

Unrealized gains (losses) on the Company’s derivatives classified as cash flow hedges that were recognized in accumulated other comprehensive income (loss) were not material during the periods presented.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Unrealized gains (losses) on the Company’s derivatives not classified as cash flow hedges that were recognized in the Statements of Operations were as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
Classification (in thousands)						2025						2024						2025						2024
Interest expense, net						$	(11,481)					$	(58,051)					$	(45,512)					$	(46,429)
Other income (expense)						$	(3,849)					$	(4,821)					$	(11,694)					$	(14,699)

The following table includes reclassifications related to previously designated cash flow hedges and unrealized gains (losses) on interest rate swaps designated as cash flow hedges:

						Three Months Ended September 30,												Nine Months Ended September 30,
Changes in AOCI (in thousands)						2025						2024						2025						2024
Interest expense, net						$	(1,822)					$	1,943					$	(1,627)					$	6,057
Income tax (benefit) expense						$	439					$	(471)					$	391					$	(1,464)

As of September 30, 2025 and December 31, 2024, AOCI, net of tax, related to previously designated cash flow hedges was not material.

8.     INCOME TAXES

Unrecognized Tax Benefits

The Company’s unrecognized tax benefits relate to tax years that remain subject to audit by the taxing authorities in the U.S. federal, state and local, and foreign jurisdictions. During the nine months ended September 30, 2025, the Company recorded an increase to its unrecognized tax benefits of $11 million related to prior year tax positions. Based on the current tax statutes and current status of its income tax audits, the Company does not expect unrecognized tax benefits to change significantly in the next twelve months.

Effective Tax Rate

The effective tax rate can vary from period to period due to permanent tax adjustments, discrete items such as the settlement of income tax audits and changes in tax laws, as well as recurring factors such as changes in the overall state tax rate. The discussion below is based on the continuing operations of the Company.

The Company’s income tax expense for the three months ended September 30, 2025 was $55 million, resulting in an effective tax rate for the period of 27.7%. The effective tax rate primarily represents the federal statutory rate of 21.0%, a state tax rate, net of federal benefits, of 5.2%, and an unfavorable impact from a non-deductible goodwill impairment charge of 1.5%.

The Company’s income tax expense for the three months ended September 30, 2024 was $50 million, resulting in an effective tax rate for the period of 27.6%. The effective tax rate primarily represents the federal statutory tax rate of 21.0% and a state tax rate, net of federal benefits, of 6.2%.

The Company’s income tax expense for the nine months ended September 30, 2025 was $165 million, resulting in an effective tax rate for the period of 26.6%. The effective tax rate primarily represents the federal statutory rate of 21.0%, and a state tax rate, net of federal benefits, of 5.2%.

The Company’s income tax expense for the nine months ended September 30, 2024 was $167 million, resulting in an effective tax rate for the period of 28.3%. The effective tax rate primarily represents the federal statutory tax rate of 21.0%, a state tax rate, net of federal benefits, of 5.8%, and an unfavorable impact from dispositions of 1.6%.

Other Tax Matters

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, which includes a broad range of tax reform provisions, some of which may be favorable in 2025 to cash taxes. The Company is currently evaluating the impact of the OBBBA on future periods.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

9.     EQUITY

Common Stock and Class B Common Stock

The Company has two classes of common stock, which comprises Common Stock and Class B Common Stock.

Share Issuances

During the three and nine months ended September 30, 2025, shares issued resulted from the vesting of restricted stock units (“RSUs”) and stock option exercises related to fully vested share-based compensation awards as presented on the Condensed Consolidated Statements of Stockholders’ Equity.

Share Repurchases

2024 Share Repurchase Plan

In January 2024, the Company's Board of Directors announced a share repurchase plan (the “2024 Share Repurchase Plan”), pursuant to which the Company was authorized to repurchase, through January 29, 2025, up to a maximum aggregate amount of $350 million of shares of the Company's Common Stock.

In March 2024, the Company repurchased, and subsequently retired, 15 million shares of its Common Stock under the 2024 Share Repurchase Plan for $93 million (or $6.22 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo. Refer to Note 14 “Related Party Transactions” for further information.

In addition, the Company entered into an agreement in December 2024 to repurchase 15 million shares of Common Stock from a non-affiliate individual at a price per share of $6.95 for a total of $104 million under the 2024 Share Repurchase Plan. The transaction settled in January 2025, and the Company retired the shares.

The 2024 Share Repurchase Plan expired in January 2025 with $5 million in authorized repurchases remaining.

2025 Share Repurchase Plan

In February 2025, the Company's Board of Directors announced a new share repurchase plan (the “2025 Share Repurchase Plan”), pursuant to which the Company was authorized to repurchase, through April 30, 2026, up to a maximum aggregate amount of $500 million of shares of the Company's Common Stock.

The 2025 Share Repurchase Plan allowed the Company to purchase Common Stock, from time to time, in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act, or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and other factors. The Company was not obligated to repurchase any of its shares of Common Stock, and the timing and amount of any repurchases depended on legal requirements, market conditions, stock price, the availability of the safe harbor provided by Rule 10b-18 under the Exchange Act, alternative uses of capital, and other factors.

In March 2025, the Company repurchased, and subsequently retired, 20 million shares of its Common Stock under the 2025 Share Repurchase Plan for $152 million (or $7.62 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo. Refer to Note 14 “Related Party Transactions” for further information.

Additionally, in March 2025, the Company repurchased, and subsequently retired, an additional 18 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act in multiple transactions for $140 million (or $7.79 per share).

Throughout the second quarter of 2025, the Company repurchased, and subsequently retired, 12 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act under the 2025 Share Repurchase Plan in multiple transactions for a total of $96 million (or $8.14 per share).

In July 2025, the Company repurchased, and subsequently retired, 11 million shares of its Common Stock under the 2025 Share Repurchase Plan for $93 million (or $8.31 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo. The Company also repurchased, and subsequently retired, an additional 2 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act under the 2025 Share Repurchase Plan in multiple transactions for a total of $19 million (or $8.45 per share).

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

As of September 30, 2025, the Company had no authorized amounts remaining under the 2025 Share Repurchase Plan.

Dividends

(in thousands, except per share data)																		Common Stock												Class B Common Stock
Declaration Date						Record Date						Payment Date						Per Share						Aggregate						Per Share						Aggregate
During the Nine Months Ended September 30, 2025
2/27/2025						3/13/2025						4/3/2025						$	0.055					$	44,175					$	0.055					$	3,011
4/24/2025						6/12/2025						7/8/2025						0.055						42,884						0.055						3,011
7/24/2025						9/11/2025						10/2/2025						0.055						42,080						0.055						3,011
												Total						$	0.165					$	129,139					$	0.165					$	9,033
During the Nine Months Ended September 30, 2024
1/24/2024						3/14/2024						4/4/2024						$	0.055					$	47,059					$	0.055					$	3,011
4/25/2024						6/13/2024						7/9/2024						0.055						47,137						0.055						3,011
8/1/2024						9/13/2024						10/4/2024						0.055						47,146						0.055						3,011
												Total						$	0.165					$	141,342					$	0.165					$	9,033

Subsequent Event - On November 4, 2025, the Company announced a dividend of $0.055 per share to holders of Common Stock and Class B Common Stock of record on December 11, 2025, which will be paid on January 8, 2026.

Accumulated Other Comprehensive Income (Loss)

During the three and nine months ended September 30, 2025, there were no material reclassifications out of AOCI. Refer to Note 7 “Derivative Financial Instruments.”

10.     SHARE-BASED COMPENSATION

RSUs

During the first quarter of 2025, the Company completed its annual long-term incentive plan equity award (the “2025 Annual Grant”) to employees and granted approximately 3.4 million RSUs under its 2018 Omnibus Incentive Plan, as amended (the “2018 Plan”), with a grant date fair value of $7.59, which is equal to the closing price per share of the Company’s Common Stock on the date of grant. These RSUs are service-based awards with a three-year graded vesting period from the date of grant.

Options

During the first quarter of 2025, the Company granted approximately 8.3 million options under the 2018 Plan as part of the 2025 Annual Grant. These options are service-based awards with a three-year graded vesting period from the date of grant and have an exercise price of $7.59, which is equal to the closing price per share of the Company’s Common Stock on the date of grant, and a contractual term of ten years from the grant date. The weighted-average grant date fair value for the options granted during the period was $2.65.

The Company used a binomial lattice model to determine the grant date fair value for options granted and included the following assumptions:

Expected exercise term (years)			6 - 7
Expected volatility(1)			41.7%
Expected dividend yield(2)			2.9%
Risk-free interest rate(3)			4.2%

_________________

(1)    Estimated using historical and implied stock price volatility of the Company.

(2)    Calculated by taking the annual dividend run-rate and dividing by the stock price at date of grant.

(3)    Based on the U.S. Treasury yield curve.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Other

During the first quarter of 2025, the Company modified certain share-based compensation awards and recorded additional share-based compensation expense of $11 million associated with these modifications.

11.     EARNINGS PER SHARE

The Company applies the two-class method for computing and presenting earnings per share for each class of common stock, which allocates current period income (losses) to each class of common stock and participating securities based on dividends declared and participation rights in the remaining undistributed earnings or losses.

Basic earnings per share is computed by dividing the income (losses) allocated to each class of common stock by the related weighted-average number of shares outstanding during the period. Diluted earnings per share gives effect to all securities representing potential common shares that were dilutive and outstanding during the period for each class of common stock and excludes potentially dilutive securities whose effect would have been anti-dilutive.

Common Stock

Potential shares of Common Stock include (i) incremental shares related to the vesting or exercise of share-based compensation awards, warrants, and other options to purchase additional shares of the Company’s Common Stock calculated using the treasury stock method and (ii) incremental shares of Common Stock issuable upon the conversion of Class B Common Stock. Additionally, the basic and diluted earnings per share computations for Common Stock for the periods presented exclude unvested shares of approximately 4 million and 7 million, respectively, as their vesting is contingent upon achievement of certain performance requirements.

						Three Months Ended September 30,												Nine Months Ended September 30,
in thousands, except per share amounts						2025						2024						2025						2024
Allocation of income (loss) from continuing operations - basic						$	133,912					$	124,078					$	424,496					$	396,740
Dilutive effect						3,486						3,327						10,484						10,068
Allocation of income (loss) from continuing operations - diluted						$	137,398					$	127,405					$	434,980					$	406,808
Allocation of income (loss) from discontinued operations, net of tax - basic						$	1,512					$	(4,576)					$	(3,426)					$	(104,340)
Dilutive effect						—						—						—						—
Allocation of income (loss) from discontinued operations, net of tax - diluted						$	1,512					$	(4,576)					$	(3,426)					$	(104,340)
Weighted-average shares outstanding - basic						764,742						850,462						783,310						851,539
Dilutive effect(1)						63,706						62,399						63,185						61,757
Weighted-average shares outstanding - diluted						828,448						912,861						846,495						913,296
Income (loss) from continuing operations per share - basic						$	0.18					$	0.15					$	0.54					$	0.46
Income (loss) from continuing operations per share - diluted						$	0.17					$	0.14					$	0.51					$	0.44
Income (loss) from discontinued operations, net of tax, per share - basic						$	—					$	(0.01)					$	—					$	(0.12)
Income (loss) from discontinued operations, net of tax, per share - diluted						$	—					$	(0.01)					$	—					$	(0.11)

_________________

(1)    During the three and nine months ended September 30, 2025, 21 million shares of Common Stock, respectively, that would be dilutive were excluded from the diluted earnings per share calculations because their effects would have been anti-dilutive.

During the three and nine months ended September 30, 2024, 21 million shares and 20 million shares of Common Stock, respectively, that would be dilutive were excluded from the diluted earnings per share calculations because their effects would have been anti-dilutive.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Class B Common Stock

						Three Months Ended September 30,												Nine Months Ended September 30,
in thousands, except per share amounts						2025						2024						2025						2024
Allocation of income (loss) from continuing operations - basic						$	9,600					$	7,942					$	29,726					$	25,356
Dilutive effect						(475)						(316)						(1,451)						(1,035)
Allocation of income (loss) from continuing operations - diluted						$	9,125					$	7,626					$	28,275					$	24,321
Allocation of income (loss) from discontinued operations, net of tax - basic						$	108					$	(293)					$	(239)					$	(6,660)
Dilutive effect						—						—						—						—
Allocation of income (loss) from discontinued operations, net of tax - diluted						$	108					$	(293)					$	(239)					$	(6,660)
Weighted-average shares outstanding - basic						54,745						54,745						54,745						54,745
Dilutive effect(1)						—						—						—						—
Weighted-average shares outstanding - diluted						54,745						54,745						54,745						54,745
Income (loss) from continuing operations per share - basic						$	0.18					$	0.15					$	0.54					$	0.46
Income (loss) from continuing operations per share - diluted						$	0.17					$	0.14					$	0.51					$	0.44
Income (loss) from discontinued operations, net of tax, per share - basic						$	—					$	(0.01)					$	—					$	(0.12)
Income (loss) from discontinued operations, net of tax, per share - diluted						$	—					$	(0.01)					$	—					$	(0.11)

________________

(1)    There were no potential shares of Class B Common Stock during the periods presented.

12.     COMMITMENTS AND CONTINGENCIES

Contractual Obligations

There have been no significant changes to the Company’s contractual obligations as compared to December 31, 2024, except as discussed below:

Google Commercial Agreement

In July 2020, the Company and Google LLC (“Google”) entered into a Master Supply, Distribution, and Marketing Agreement (as amended, the “Google Commercial Agreement”), which, among other things, specifies that each party shall contribute $150 million toward joint marketing, customer acquisition, training of the Company’s employees, and product technology updates related to the Google Devices and Services. In August 2022, the Company and Google executed an amendment to the Google Commercial Agreement, pursuant to which Google has agreed to commit an additional $150 million to fund growth, data and insights, product innovation and technology advancements, customer acquisition, and marketing, as mutually agreed by the Company and Google, (together with the initial amounts, the “Google Success Funds”).

During the nine months ended September 30, 2025, $20 million of the Google Success Funds were reimbursed to the Company primarily for certain joint marketing and customer acquisition expenses incurred by the Company, substantially all of which was recorded as a reduction to advertising expenses.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Google Cloud Agreement Addendum

In December 2023, the Company and Google entered into an addendum to the Company’s existing agreement with Google for using Google cloud services (the “Google Cloud Agreement Addendum”), pursuant to which Google has agreed to provide certain credits, discounts, and other incentives for use of the Google Cloud Platform to the Company, and the Company has committed to purchasing $200 million of Google Cloud Platform services over seven years (through December 2030), with $35 million in the first two years, $65 million in the next two years after that, and $100 million in the last three years of the commitment. The Company may elect to cancel the commitment in return for a cancellation fee of 30% of the total remaining commitment amount and loss of any discounts, remaining credits, or other incentives provided under the Google Cloud Agreement Addendum.

As of September 30, 2025, the Company continues to work to meet this commitment.

Other Commitments

The Company is party to an agreement with one of its vendors to purchase at least $370 million of security system equipment and components through December 2025. This commitment is also satisfied through purchases made by the Company’s dealer network.

As of December 31, 2024, the remaining amount under this commitment was $172 million. During the nine months ended September 30, 2025, purchases toward this commitment were approximately $140 million.

Guarantees

In the normal course of business, the Company is liable for contract completion and product performance. As of September 30, 2025 and December 31, 2024, the Company’s guarantees primarily relate to standby letters of credit related to its insurance programs and totaled $48 million and $74 million, respectively.

The Company does not believe such obligations will materially affect its financial position, results of operations, or cash flows.

Legal Proceedings

The Company is subject to various claims and lawsuits in the ordinary course of business, which include among other things commercial general liability claims, automobile liability claims, contractual disputes, worker’s compensation claims, labor law and employment claims, claims related to alleged alarm system failures, claims that the Company infringed on the intellectual property of others, and consumer and employment class actions. The Company is also subject to regulatory and governmental examinations, information requests and subpoenas, inquiries, investigations, and threatened legal actions and proceedings. In connection with such formal and informal inquiries, the Company receives numerous requests, subpoenas, and orders for documents, testimony, and information in connection with various aspects of its activities. There have been no material changes to the disclosures in the Company’s 2024 Annual Report.

The Company records accruals for losses that are probable and reasonably estimable. These accruals are based on a variety of factors such as judgment, probability of loss, opinions of internal and external legal counsel, and actuarially determined estimates of claims incurred but not yet reported based upon historical claims experience. Legal costs in connection with claims and lawsuits in the ordinary course of business are expensed as incurred. Additionally, the Company records insurance recovery receivables or other indemnifications from third-parties when recovery has been determined to be probable. The Company has not accrued for any losses for which the likelihood of loss cannot be assessed, is less than probable, or the range of possible loss cannot be estimated.

As of September 30, 2025 and December 31, 2024, the Company’s accrual for ongoing claims and lawsuits within the scope of an insurance program, including certain amounts related to discontinued operations, totaled $90 million and $94 million, respectively. The Company’s accrual related to ongoing claims and lawsuits not within the scope of an insurance program is not material.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

13.     LEASES

Company as Lessee

As part of normal operations, the Company leases real estate, vehicles, and equipment primarily through its main operating entity and wholly-owned subsidiary, ADT LLC.

Right-of-Use Assets and Lease Liabilities

(in thousands)																		September 30, 2025						December 31, 2024
Presentation and Classification:
Operating						Current						Prepaid expenses and other current assets						$	93					$	80
Operating						Non-current						Other assets						84,159						80,768
Finance						Non-current						Property and equipment, net(1)						45,547						61,827
Total right-of-use assets																		$	129,799					$	142,675
Operating						Current						Accrued expenses and other current liabilities						$	16,979					$	18,811
Finance						Current						Current maturities of long-term debt						23,036						25,593
Operating						Non-current						Other liabilities						81,545						77,884
Finance						Non-current						Long-term debt						30,470						43,849
Total lease liabilities																		$	152,030					$	166,137

_________________

(1)Finance lease right-of-use assets are recorded net of accumulated depreciation, which was approximately $83 million and $66 million as of September 30, 2025 and December 31, 2024, respectively.

Lease Cost

						Three Months Ended September 30,												Nine Months Ended September 30,
(in thousands)						2025						2024						2025						2024
Operating lease cost						$	5,391					$	7,365					$	18,545					$	20,943
Finance lease cost:
Amortization of right-of-use assets						5,602						6,095						16,454						16,203
Interest on lease liabilities						815						1,109						2,579						3,514
Variable lease costs						9,682						8,701						29,831						24,428
Total lease cost						$	21,490					$	23,270					$	67,409					$	65,088

Lease Liabilities Arising from Obtaining Right-of-Use Assets(1)

						Nine Months Ended September 30,
(in thousands)						2025						2024
Operating leases						$	18,344					$	14,200
Finance leases						$	9,525					$	33,283

_________________

(1)Includes both continuing and discontinued operations, as applicable.

Company as Lessor

The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component. The Company accounts for the combined component as a single performance obligation under the applicable revenue guidance and recognizes the underlying assets within subscriber system assets, net.

14.     RELATED PARTY TRANSACTIONS

The Company’s related party transactions primarily relate to products and services received from, or monitoring and related services provided to, other entities affiliated with Apollo, and, from time to time, certain transactions with Apollo or State Farm. There were no notable related party transactions during the periods presented other than as described below.

Apollo

March 2025 Offering and Share Repurchase

On March 3, 2025, the Company and certain entities managed by affiliates of Apollo Global Management, Inc. (the “Selling Stockholders”) entered into an underwriting agreement with Barclays Capital Inc. and Citigroup Capital Markets Inc., as representatives of the underwriters named therein, including Apollo Global Securities, LLC, an affiliate of Apollo (collectively, the “March 2025 Underwriters”), in connection with the offer and sale by the Selling Stockholders of 70 million shares of the Company’s Common Stock (plus an additional 10.5 million shares at the option of the March 2025 Underwriters) (the “March 2025 Offering”).

As part of the March 2025 Offering, the Company repurchased, and subsequently retired, 20 million shares of its Common Stock under its 2025 Share Repurchase Plan from the March 2025 Underwriters (the “March 2025 Share Repurchase”) for an aggregate purchase price of $152 million (or approximately $7.62 per share), which was the same per share price paid by the March 2025 Underwriters to the Selling Stockholders. The repurchase is reflected as a reduction to additional paid-in-capital and as a financing cash outflow.

The March 2025 Offering and the March 2025 Share Repurchase closed on March 4, 2025. On March 7, 2025, the March 2025 Underwriters exercised the March 2025 Underwriters’ Option in full, which subsequently closed on March 11, 2025.

June 2025 Apollo Sale

During the second quarter of 2025, the Selling Stockholders sold an aggregate of 45 million shares of the Company’s Common Stock in the open market at a price of $8.27 per share (the “June 2025 Apollo Sale”). Immediately following the June 2025 Apollo Sale, Apollo owned less than 25% of the Company’s outstanding Common Stock and, as a result, the Company’s Amended and Restated Management Investor Rights Agreement terminated. The consent rights described in Section 4.1 of the Amended and Restated Stockholders Agreement also terminated following the June 2025 Apollo Sale. Additionally, the margin loan as defined and discussed in the 2024 Annual Report was paid off in full following the June 2025 Apollo Sale.

July 2025 Offering and Share Repurchase

During the third quarter of 2025, the Selling Stockholders sold 71 million shares of the Company’s Common Stock (plus an additional 10.65 million shares at the option of the underwriters) (the “July 2025 Offering”). In connection with the July 2025 Offering, the Company repurchased, and subsequently retired, 11 million shares of its Common Stock under the 2025 Share Repurchase Plan for an aggregate purchase price of $93 million (or approximately $8.31 per share).

March 2024 Offering and Share Repurchase

During the first quarter of 2024, the Selling Stockholders sold 65 million shares of the Company’s Common Stock (plus an additional 9.75 million shares at the option of the underwriters) (the “March 2024 Offering”). In connection with the March 2024 Offering, the Company repurchased, and subsequently retired, 15 million shares of its Common Stock under the 2024 Share Repurchase Plan for an aggregate purchase price of $93 million (or approximately $6.22 per share).

The shares in the above offerings were sold by the Selling Stockholders; and the Company did not receive any of the proceeds from the sale of shares by the Selling Stockholders. In addition, the Company did not pay any underwriting fees, including on behalf of the Selling Stockholders or otherwise.

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ADT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Other Transactions with Apollo

During the nine months ended September 30, 2025 and 2024, other fees incurred to Apollo were not material.

State Farm

State Farm owns more than 10% of the Company’s issued and outstanding common stock, and as a result, is a related party.

In October 2022, the Company, ADT LLC (an indirect wholly owned subsidiary of the Company), and State Farm entered into a development agreement (the “State Farm Development Agreement”) in connection with State Farm’s strategic investment in ADT. Pursuant to the State Farm Development Agreement, State Farm committed up to $300 million to fund certain initiatives as agreed to between the Company and State Farm related to the partnership (the “Opportunity Fund”), of which the Company received $100 million during 2022. Amounts held by the Company in the Opportunity Fund are restricted until the Company uses the funds, as agreed upon with State Farm, in accordance with the State Farm Development Agreement.

As of September 30, 2025 and December 31, 2024, the balance of the portion of the Opportunity Fund held by the Company was $82 million and $85 million, respectively, which is presented in restricted cash and restricted cash equivalents and the corresponding liability is presented in accrued expenses and other current liabilities.

During the nine months ended September 30, 2025 and 2024, the Company made payments from the Opportunity Fund of $6 million and $10 million, respectively. Interest earned on the Opportunity Fund was not material.

Subsequent event - The State Farm Development Agreement expired on October 13, 2025. On October 24, 2025, the Company repaid to State Farm substantially all of the balance of the Opportunity Fund held by the Company. State Farm has no obligation to fund the Opportunity Fund in the future. In addition, the Company ended its State Farm partnership programs in existing states in connection with the expiration of the State Farm Development Agreement.

Fleet Management Agreement

During the second quarter of 2025, the Company entered into an agreement with a vendor affiliated with Apollo for fleet management and related services through 2030. The impact to the Company was not material during the periods presented.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Table of Contents

•Introduction

•Business and Basis of Presentation

•Key Performance Indicators

•Trends, Uncertainties, and Factors Affecting Operating Results

•Results of Operations

•Non-GAAP Measures

•Liquidity and Capital Resources

•Critical Accounting Estimates

•Cautionary Statements Regarding Forward-Looking Statements

INTRODUCTION

The following section contains forward-looking statements about our business, operations, and financial performance based on current plans and estimates that involve risks, uncertainties, and assumptions, which could differ materially from actual results. Factors that could cause such differences are discussed in the sections of this Quarterly Report on Form 10-Q titled “Cautionary Statements Regarding Forward-Looking Statements” and Item 1A “Risk Factors.”

The discussion and analysis below focuses on significant or material items to the Company. To obtain a more comprehensive understanding of our financial condition, changes in financial condition, and results of operations, the following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q, as well as our audited consolidated financial statements and the related notes included in our 2024 Annual Report.

BUSINESS AND BASIS OF PRESENTATION

Our Business

ADT (or “we,” “our,” and “us”), provides security, interactive, and smart home solutions to consumer and small business customers in the U.S.

Our mission is to empower people to protect and connect what matters most with safe, smart, and sustainable solutions, delivered through innovative offerings, unrivaled safety, and a premium experience because we believe that everyone deserves to feel safe.

Basis of Presentation

We report our results as a single operating and reportable segment. All financial information presented in this section has been prepared in U.S. dollars in accordance with GAAP, excluding any non-GAAP measures, and includes the accounts of ADT Inc. and its wholly-owned subsidiaries. All intercompany transactions have been eliminated.

Results of our former Solar and Commercial businesses are presented within discontinued operations for current and historical periods, as applicable.

KEY PERFORMANCE INDICATORS

We evaluate our results using certain key performance indicators, including operating metrics such as recurring monthly revenue and gross customer revenue attrition, as well as GAAP total revenue and the non-GAAP measures Adjusted Earnings per Share (“Adjusted EPS”) and Adjusted EBITDA (“Adjusted EBITDA”), both from continuing operations.

Computations of our key performance indicators may not be comparable to other similarly titled measures reported by other companies.

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Certain operating metrics are approximated, as there may be variations to reported results due to certain adjustments we might make in connection with the integration over several periods of acquired companies that calculated these metrics differently or periodic reassessments and refinements in the ordinary course of business, including changes due to system conversions or historical methodology differences in legacy systems.

Total Revenue

Management and the Board use total revenue, which is calculated in accordance with GAAP, to evaluate the performance of employees (including members of management) and the Company as a whole, as well as to allocate resources. Refer to the section titled “Results of Operations—Revenue” for additional information.

End-of-Period Recurring Monthly Revenue (“RMR”)

RMR is generated by contractual recurring fees for monitoring and other recurring services provided to our customers, including contracts monitored but not owned.

We use RMR to evaluate our overall sales, installation, and retention performance. Additionally, we believe the presentation of RMR is useful to investors because it measures the volume of revenue under contract at a given point in time, which is useful for forecasting future revenue performance as the majority of our revenue comes from recurring sources.

Gross Customer Revenue Attrition

Gross customer revenue attrition is defined as RMR lost as a result of customer attrition, net of dealer charge-backs and reinstated customers, excluding contracts monitored but not owned and self set-up/do-it-yourself (“DIY”) customers. Customer sites are considered canceled when all services are terminated. Dealer charge-backs represent customer cancellations charged back to the dealers because the customer canceled service during the charge-back period, which is generally thirteen months.

Gross customer revenue attrition is calculated on a trailing twelve-month basis, the numerator of which is the RMR lost during the period due to attrition, net of dealer charge-backs and reinstated customers, and the denominator of which is total annualized RMR based on an average of RMR under contract at the beginning of each month during the period, in each case, excluding contracts monitored but not owned and self set-up/DIY customers.

We use gross customer revenue attrition to evaluate our retention and customer satisfaction performance, as well as evaluate subscriber trends by vintage year. Additionally, we believe the presentation of gross customer revenue attrition is useful to investors as it provides a means to evaluate drivers of customer attrition and the impact of retention initiatives.

Adjusted EPS

Adjusted EPS (from continuing operations) is a non-GAAP measure. Our definition of Adjusted EPS, a reconciliation of Adjusted EPS to diluted income (loss) from continuing operations per share (the most directly comparable GAAP measure), and additional information, including a description of the limitations relating to the use of Adjusted EPS, are provided under “Results of Operations—Non-GAAP Measures.”

Adjusted EBITDA

Adjusted EBITDA (from continuing operations) is a non-GAAP measure. Our definition of Adjusted EBITDA, a reconciliation of Adjusted EBITDA to income (loss) from continuing operations (the most directly comparable GAAP measure), and additional information, including a description of the limitations relating to the use of Adjusted EBITDA, are provided under “Results of Operations—Non-GAAP Measures.”

TRENDS, UNCERTAINTIES, AND FACTORS AFFECTING OPERATING RESULTS

The information described herein could have a material effect on our business, financial condition, results of operations, cash flows, and key performance indicators. Unless otherwise noted, our results of operations discussed below relate to continuing operations.

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Subscribers

As of September 30, 2025, we served approximately 6.3 million security monitoring service subscribers (including approximately 200 thousand subscribers associated with the Multifamily business that was divested on October 1, 2025). Generally, a significant upfront investment is required to acquire new subscribers that in turn provide ongoing and predictable recurring revenue (RMR) generated from our monitoring services and other subscriber-based offerings. Although the economics of each installation may vary depending on the customer type, acquisition channel, and product and service offerings, we generally achieve revenue break-even in approximately two years.

New subscriber additions and customer attrition have a direct impact on our financial results, including revenue, operating income, and cash flows. A portion of our recurring subscriber base can be expected to cancel its service each year for a variety of reasons, including relocation, cost, loss to competition, or service issues, or we may disconnect service due to non-payment. For example, a 1% change in customer attrition typically has approximately a $40 million impact on recurring revenue on an annualized basis.

As of September 30, 2025, gross customer revenue attrition was 13.0%, as compared to 12.8% in the prior year, driven by higher non-payment and voluntary disconnects partially offset by fewer relocations.

Relocations are sensitive to changes in the residential housing market, and fewer relocations generally lead to improvements in customer attrition, but fewer subscriber additions. Additionally, non-payment disconnects generally increase in a weaker macroeconomic environment. We may experience fluctuations in these or other trends in the future as changes in the general macroeconomic environment or housing market develop.

Revenue and Offerings

The mix, price, offerings, sales and distribution channel, and equipment ownership of transactions impacts our results. For example, our results are impacted by the mix of transactions accounted for under a Company-owned equipment model versus a customer-owned equipment model (referred to as outright sales), as there are different accounting treatments applicable to each model, as discussed in Note 2 “Revenue and Receivables.” Historically, the majority of professional installation transactions occurred under a Company-owned model. However, since the second quarter of 2024, a growing percentage of our direct channel new subscriber adds are outright sales in connection with the national launch of our new ADT+ platform. During the nine months ended September 30, 2025, we have experienced an increase in both security installation, product, and other revenue and related costs due to the transition to our ADT+ platform, in which the equipment is sold outright to the customer. Currently, approximately 25% of new direct subscribers are outright sales. As we continue to roll out ADT+ to additional subscribers including add-ons, upgrades, and resales, build our partnership with Google, introduce additional Google products into our offerings, launch new or enhance our current offerings, and refine our go-to-market approach, we expect outright sales to continue to be an increasing proportion of our direct channel transactions in future periods, which is expected to result in an increase in security installation, product, and other revenue and cost of revenue recognized in the statements of operations.

Changes in our recurring revenue base, including subscriber count, price escalations, or change in offerings, can also impact our results. As of September 30, 2025, RMR was $362 million, as compared to $359 million in the prior year, driven by an increase in average prices.

Additionally, the mix of professional installation solutions versus self set-up solutions may impact our results in future periods, as professional installation solutions typically have higher contractual fees than our self set-up solutions as a result of differences in pricing, offer tactics, and level of products and services. We currently expect that the majority of our sales will continue to be professional installation solutions.

Other Costs

We may also experience an increase in other costs associated with factors such as (i) offering a wider variety of products and services; (ii) providing a greater mix of interactive and smart home solutions; (iii) replacing or upgrading certain system components or technology due to technological advancements, cybersecurity upgrades, or otherwise; (iv) supply chain disruptions or other impacts such as tariffs or trade restrictions; (v) inflationary pressures on costs such as materials, labor, and fuel; and (vi) other changes in prices, interest rates, or terms from our suppliers, vendors, or third-party lenders.

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Macroeconomic and Other Trends and Uncertainties

We are currently monitoring, and will continue to monitor, macroeconomic trends and uncertainties such as key components of inflation, the status and effects of recently implemented or threatened tariffs and other trade restrictions, as well as potential changes to these tariffs or the imposition of reciprocal or other tariffs or trade restrictions by other countries. Any of these may have negative consequences for our supply chain due to price increases from our vendors or suppliers. At this time, we do not anticipate material negative impacts that cannot be mitigated through arrangements with our vendors and suppliers, price increases to our customers, or other actions but there is no guarantee that we will be able to successfully mitigate the negative effects of any such macroeconomic trends and uncertainties. We are also unable at this time to determine any future negative impacts from reduced consumer spending as a result of inflationary or other pressures or uncertainty that may result from the imposition of current or future tariffs or other trade restrictions.

As part of our response to changes or pressures in the current macroeconomic environment, we have been evaluating, and continue to evaluate, cost-saving opportunities such as leveraging technology, reducing headcount or our physical facilities footprint when appropriate, and reducing non-essential spend. While we have experienced some increase in costs as a result of inflation, we have, for the most part, been able to offset the rising costs through cost-saving opportunities, as well as price increases to our customers.

In addition, hurricanes, wildfires, and other natural disasters impacting certain areas in which we operate may result in service, sales, and installation disruptions to certain of our customers. As such, we evaluate the financial and business impacts these events have or may have in the future. During the nine months ended September 30, 2025, we did not experience any material losses related to natural disasters.

Other Tax Matters

As a result of Apollo selling shares of our Common Stock (as discussed in Note 14 “Related Party Transactions”) and our share repurchase program, an ownership change (as defined under Sections 382 and 383 of the Internal Revenue Code) occurred during the second quarter of 2025. Generally, an ownership change occurs when the aggregate ownership of certain shareholders shifts, for federal income tax purposes, by more than 50 percentage points in total over a rolling three-year period. An ownership change imposes annual limitations on a corporation’s ability to utilize its tax attributes to offset future U.S. taxable income. Our tax attributes that are subject to the limitations primarily consist of disallowed interest carryforwards. However, the limitation as a result of the ownership change significantly exceeded the value of these attributes. As such, we currently do not expect a material impact to our results from this ownership change.

On July 4, 2025, the OBBBA was signed into law, which includes a broad range of tax reform provisions, some of which we expect may be favorable in 2025 to cash taxes. We are currently evaluating the impact of the OBBBA on future periods.

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RESULTS OF OPERATIONS

						Three Months Ended September 30,																		Nine Months Ended September 30,
(in thousands, except per share data or as otherwise indicated)						2025						2024						$ Change						2025						2024						$ Change
Revenue:
Monitoring and related services						$	1,097,561					$	1,077,550					$	20,011					$	3,270,906					$	3,208,267					$	62,639
Security installation, product, and other						200,393						166,286						34,107						581,574						429,800						151,774
Total revenue						1,297,954						1,243,836						54,118						3,852,480						3,638,067						214,413
Cost of revenue (exclusive of depreciation and amortization shown separately below):
Monitoring and related services						161,788						154,744						7,044						481,566						460,649						20,917
Security installation, product, and other						88,922						67,362						21,560						259,452						151,996						107,456
Total cost of revenue						250,710						222,106						28,604						741,018						612,645						128,373
Selling, general, and administrative expenses						384,353						360,110						24,243						1,109,091						1,120,617						(11,526)
Depreciation and intangible asset amortization						347,818						335,270						12,548						1,026,069						1,002,131						23,938
Operating income (loss)						315,073						326,350						(11,277)						976,302						902,674						73,628
Interest expense, net						(112,617)						(161,830)						49,213						(349,294)						(358,980)						9,686
Other income (expense)						(3,835)						17,735						(21,570)						(7,896)						44,907						(52,803)
Income (loss) from continuing operations before income taxes						198,621						182,255						16,366						619,112						588,601						30,511
Income tax benefit (expense)						(55,109)						(50,235)						(4,874)						(164,890)						(166,505)						1,615
Income (loss) from continuing operations						143,512						132,020						11,492						454,222						422,096						32,126
Income (loss) from discontinued operations, net of tax						1,620						(4,869)						6,489						(3,665)						(111,000)						107,335
Net income (loss)						$	145,132					$	127,151					$	17,981					$	450,557					$	311,096					$	139,461
Diluted income (loss) from continuing operations per share of Common Stock						$	0.17					$	0.14					$	0.03					$	0.51					$	0.44					$	0.07
Diluted weighted-average shares outstanding of Common Stock						828,448						912,861						(84,413)						846,495						913,296						(66,801)
Key Performance Indicators:(1)
RMR(2)(3)						$	362,434					$	358,881					$	3,553					$	362,434					$	358,881					$	3,553
Gross customer revenue attrition (percent)(2)						13.0%						12.8%						N/A*						13.0%						12.8%						N/A*
Adjusted EPS(4)						$	0.23					$	0.20					$	0.03					$	0.67					$	0.56					$	0.11
Adjusted EBITDA(4)						$	675,646					$	658,691					$	16,955					$	2,010,071					$	1,925,669					$	84,402

_______________________

(1)Refer to the “—Key Performance Indicators” section for the definitions of these key performance indicators.

(2)Refer to the “—Factors Affecting Operating Results” section for additional details and comparison of current to prior period results.

(3)Includes approximately $2.6 million of RMR as of September 30, 2025, associated with the Multifamily business that was divested on October 1, 2025.

(4)Refer to the “—Non-GAAP Measures” section for the definitions of these non-GAAP measures and reconciliations to the most comparable GAAP measures.

* Not applicable.

Revenue

The three and nine months ended September 30, 2025, as compared to the prior year periods, primarily reflects:

•Monitoring and related services revenue (“M&S Revenue”): higher recurring revenue of $15 million and $47 million, respectively, primarily driven by an increase in average prices of $27 million and $85 million, respectively, partially offset by a decrease in volume of $9 million and $33 million, respectively.

•Security installation, product, and other revenue: higher installation revenue of $32 million and $141 million, respectively, primarily driven by a higher mix of professionally installed systems under the outright sales model at higher average prices in connection with the transition to our ADT+ platform.

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Cost of Revenue

The three and nine months ended September 30, 2025, as compared to the prior year periods, primarily reflects:

•Monitoring and related services costs (“M&S Costs”): an increase in M&S Costs of $7 million and $21 million, respectively, primarily due to higher interactive fees.

•Security installation, product, and other costs: an increase in installation and product costs of $22 million and $107 million, respectively, primarily due to a higher mix of professionally installed outright sales transactions.

Selling, General, and Administrative Expenses

The three months ended September 30, 2025, as compared to the prior year period, primarily reflects:

•goodwill impairment of $12 million associated with the Multifamily Divestiture,

•an increase in the allowance for credit losses of $9 million primarily as a result of an increase in outright sales revenue and customer delinquencies, and

•an increase in the amortization of deferred subscriber acquisition costs of $8 million partially offset by

•a decrease in general and administrative expenses of $14 million primarily as a result of cost savings initiatives.

The nine months ended September 30, 2025, as compared to the prior year period, primarily reflects:

•a decrease in general and administrative costs of $55 million primarily as a result of $20 million related to a legal settlement in the prior year, as well as cost savings initiatives, partially offset by

•an increase in the allowance for credit losses of $25 million primarily as a result of an increase in outright sales revenue and customer delinquencies and

•an increase in the amortization of deferred subscriber acquisition costs of $21 million.

Depreciation and Intangible Asset Amortization

The three and nine months ended September 30, 2025, as compared to the prior year periods, primarily reflects an increase in the amortization of acquired customer contracts of $9 million and $18 million, respectively.

Interest Expense, Net

The three months ended September 30, 2025, as compared to the prior year period, primarily reflects unrealized losses on our interest rate swaps of $11 million in the current year as compared to $58 million in the prior year.

The nine months ended September 30, 2025, as compared to the prior year period, primarily reflects a decrease in interest rates on our long-term debt.

Other Income (Expense)

The three and nine months ended September 30, 2025, as compared to the prior year periods, primarily reflects lower Commercial TSA income of $14 million and $35 million, respectively.

Income Tax Benefit (Expense)

The Company’s income tax expense for the three months ended September 30, 2025 was $55 million, resulting in an effective tax rate for the period of 27.7%. The effective tax rate primarily represents the federal statutory rate of 21.0%, a state tax rate, net of federal benefits, of 5.2%, and an unfavorable impact from a non-deductible goodwill impairment charge of 1.5%.

The Company’s income tax expense for the three months ended September 30, 2024 was $50 million, resulting in an effective tax rate for the period of 27.6%. The effective tax rate primarily represents the federal statutory tax rate of 21.0% and a state tax rate, net of federal benefits, of 6.2%.

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The Company’s income tax expense for the nine months ended September 30, 2025 was $165 million, resulting in an effective tax rate for the period of 26.6%. The effective tax rate primarily represents the federal statutory rate of 21.0%, and a state tax rate, net of federal benefits, of 5.2%.

The Company’s income tax expense for the nine months ended September 30, 2024 was $167 million, resulting in an effective tax rate for the period of 28.3%. The effective tax rate primarily represents the federal statutory tax rate of 21.0%, a state tax rate, net of federal benefits, of 5.8%, and an unfavorable impact from dispositions of 1.6%.

NON-GAAP MEASURES

To provide investors with additional information in connection with our results as determined in accordance with GAAP, we disclose the following non-GAAP measures. These measures are not financial measures calculated in accordance with GAAP, and should not be considered as a substitute for net income, income (loss) from continuing operations, operating income, or their respective per share amounts as applicable, or any other measure calculated in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies.

Adjusted EPS

We define Adjusted EPS as diluted income (loss) from continuing operations per share adjusted for the per share amounts related to (i) share-based compensation expense; (ii) merger, restructuring, integration, and other items; (iii) impairment charges; (iv) unrealized (gains) or losses on interest rate swaps; (v) other non-cash or non-routine adjustments not necessary to operate our business; and (vi) the impact these items have on taxes.

The diluted weighted average shares outstanding used in Adjusted EPS is equal to diluted weighted average shares outstanding of Common Stock calculated in accordance with GAAP.

We believe Adjusted EPS is a benchmark used by analysts and investors in our industry to compare our performance against the performance of other companies, although this measure may not be directly comparable to similar measures reported by other companies. We believe the presentation of Adjusted EPS is useful to investors as it provides additional information about how our management evaluates the business. Beginning in 2025, management and the Board also use Adjusted EPS to evaluate the performance of employees (including members of management) and the Company as a whole, as well as to allocate resources.

There are material limitations to using Adjusted EPS as it does not include certain significant items, including the adjustments discussed above, which directly affect our diluted income (loss) from continuing operations per share (the most comparable GAAP measure). These limitations are best addressed by considering the economic effects of the excluded items independently and by considering Adjusted EPS in conjunction with diluted income (loss) from continuing operations per share as calculated in accordance with GAAP.

The table below reconciles Adjusted EPS to diluted income (loss) from continuing operations per share of Common Stock:

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2025						2024						$ Change						2025						2024						$ Change
Diluted income (loss) from continuing operations per share of Common Stock			$	0.17					$	0.14					$	0.03					$	0.51					$	0.44					$	0.07
Share-based compensation expense			0.01						0.01						—						0.05						0.04						0.01
Merger, restructuring, integration, and other			0.01						—						0.01						0.02						0.02						—
Goodwill impairment(1)			0.01						—						0.01						0.01						—						0.01
Interest rate swaps, net(2)			0.02						0.07						(0.05)						0.07						0.07						—
Loss on extinguishment of debt			0.01						—						0.01						0.01						—						0.01
Other, net			0.01						(0.01)						0.02						0.01						(0.01)						0.02
Tax impact on adjustments(3)			(0.01)						(0.02)						0.01						(0.04)						(0.03)						(0.01)
Adjusted EPS(4)			$	0.23					$	0.20					$	0.03					$	0.67					$	0.56					$	0.11

________________

(1) Represents a goodwill impairment charge associated with the Multifamily Divestiture. Refer to Note 5 “Goodwill and Other Intangible Assets.”

(2) Represents unrealized gains or losses on interest rate swaps presented in interest expense, net and other income (expense).

(3) Represents the tax impact on adjustments using the federal and state blended statutory rate.

(4) Amounts may not sum in this table due to rounding.

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During the three and nine months ended September 30, 2025, the increase in Adjusted EPS, as compared to the prior year periods, was primarily due to (i) increases of approximately $0.02 and $0.07 per share, respectively, due to increases in revenue, net of the related costs including the allowance for credit losses, (ii) increases of approximately $0.02 and $0.06 per share, respectively, due to lower general and administrative costs, and (iii) increases of approximately $0.02 and $0.05 per share, respectively, due to a decrease in our diluted weighted average shares outstanding as a result of share repurchases. This was partially offset by decreases of approximately $0.02 and $0.05 per share, respectively, of other income (expense) primarily due to lower Commercial TSA income.

The factors listed above exclude amounts that are outside of our definition of Adjusted EPS. Refer to the discussions above under “—Results of Operations” for further details.

Adjusted EBITDA

We define Adjusted EBITDA as income (loss) from continuing operations adjusted for (i) interest; (ii) taxes; (iii) depreciation and amortization, including depreciation of subscriber system assets and other fixed assets and amortization of dealer and other intangible assets; (iv) amortization of deferred costs and deferred revenue associated with subscriber acquisitions; (v) share-based compensation expense; (vi) merger, restructuring, integration, and other items; (vii) impairment charges; and (viii) other non-cash or non-routine adjustments not necessary to operate our business.

We believe Adjusted EBITDA is useful to investors to measure the operational strength and performance of our business. We believe the presentation of Adjusted EBITDA is useful as it provides investors additional information about our operating profitability adjusted for certain non-cash items, non-routine items we do not expect to continue at the same level in the future, as well as other items not core to our operations. Further, we believe Adjusted EBITDA provides a meaningful measure of operating profitability because we use it for evaluating our business performance, making budgeting decisions, and comparing our performance against other peer companies using similar measures, although this measure may not be directly comparable to similar measures reported by other companies.

There are material limitations to using Adjusted EBITDA as it does not include certain significant items, including interest, taxes, depreciation and amortization, and other adjustments which directly affect our income (loss) from continuing operations (the most comparable GAAP measure). These limitations are best addressed by considering the economic effects of the excluded items independently and by considering Adjusted EBITDA in conjunction with income (loss) from continuing operations as calculated in accordance with GAAP.

The table below reconciles Adjusted EBITDA to income (loss) from continuing operations:

			Three Months Ended September 30,																		Nine Months Ended September 30,
(in thousands)			2025						2024						$ Change						2025						2024						$ Change
Income (loss) from continuing operations			$	143,512					$	132,020					$	11,492					$	454,222					$	422,096					$	32,126
Interest expense, net			112,617						161,830						(49,213)						349,294						358,980						(9,686)
Income tax expense (benefit)			55,109						50,235						4,874						164,890						166,505						(1,615)
Depreciation and intangible asset amortization			347,818						335,270						12,548						1,026,069						1,002,131						23,938
Amortization of deferred subscriber acquisition costs			64,040						56,119						7,921						186,547						165,454						21,093
Amortization of deferred subscriber acquisition revenue			(90,005)						(87,980)						(2,025)						(268,494)						(257,538)						(10,956)
Share-based compensation expense			10,716						10,107						609						42,886						39,466						3,420
Merger, restructuring, integration, and other			5,836						1,590						4,246						12,958						15,094						(2,136)
Goodwill impairment(1)			12,023						—						12,023						12,023						—						12,023
Unrealized (gain) loss on interest rate swaps(2)			3,849						4,821						(972)						11,694						14,699						(3,005)
Loss on extinguishment of debt			4,798						—						4,798						11,241						4,509						6,732
Other, net(3)			5,333						(5,321)						10,654						6,741						(5,727)						12,468
Adjusted EBITDA			$	675,646					$	658,691					$	16,955					$	2,010,071					$	1,925,669					$	84,402

________________

(1) Represents a goodwill impairment charge associated with the Multifamily Divestiture. Refer to Note 5 “Goodwill and Other Intangible Assets.”

(2) Represents unrealized gains or losses on interest rate swaps presented in other income (expense).

(3) During 2025, primarily includes one-time costs associated with debt transactions.

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During the three and nine months ended September 30, 2025, the increase in Adjusted EBITDA, as compared to the prior year periods, was primarily due to:

•a decrease in general and administrative costs of $22 million and $57 million, respectively,

•higher M&S Revenue, net of the associated costs, of approximately $13 million and $42 million, respectively, and

•higher installation revenue, net of the associated costs and commissions, of approximately $10 million and $38 million, respectively, partially offset by

•a decrease in Commercial TSA income of $14 million and $35 million, respectively, and

•an increase in the allowance for credit losses of $9 million and $25 million, respectively.

The factors listed above exclude amounts that are outside of our definition of Adjusted EBITDA. Refer to the discussions above under “—Results of Operations” for further details.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity and capital resources primarily consisted of the following:

(in thousands)			September 30, 2025
Cash and cash equivalents			$	62,806
Restricted cash and restricted cash equivalents			$	108,228
Availability under First Lien Revolving Credit Facility			$	800,000
Uncommitted available borrowing capacity under 2020 Receivables Facility			$	108,910
Carrying amount of total debt outstanding, including finance leases			$	7,805,833

Liquidity

We expect our ongoing sources of liquidity to include cash generated from operations, borrowings under our credit facilities, and the issuance of equity and/or debt securities as appropriate given market conditions. Our future cash needs are expected to include cash for operating activities including working capital, principal and interest payments on our debt, income tax payments, capital expenditures, expected dividend payments to our stockholders, potential share repurchases, and other business initiatives as they arise.

We are a highly leveraged company with significant debt service requirements and have both fixed-rate and variable-rate debt. We may periodically seek to repay, redeem, repurchase, or refinance our indebtedness, or seek to repurchase and retire our outstanding securities through cash purchases in the open market, privately negotiated transactions, a 10b5-1 repurchase plan, or otherwise, and any such transactions may involve material amounts. Cash outflows for interest payments are not consistent between quarters, with larger outflows occurring in the first and third quarters, and may vary as a result of our variable rate debt.

We believe our cash position, available borrowing capacity under our credit agreements, and cash provided by operating activities are, and will continue to be, adequate to meet our operational and business needs in the next twelve months, as well as our long-term liquidity needs.

Material Cash Requirements

There have been no significant changes to our material cash requirements, commitments and contingencies, or off-balance sheet arrangements from those disclosed in our 2024 Annual Report, except as discussed below.

Debt Principal

As of September 30, 2025, our next debt maturity will occur in April 2026 with respect to the remaining outstanding balance of our First Lien Notes due 2026. We intend, and believe that we will have the ability through use of our ongoing sources of liquidity, to redeem these notes before or at maturity.

Share Repurchase Plans

In January 2024, our Board of Directors announced the 2024 Share Repurchase Plan, pursuant to which we were authorized to repurchase, through January 29, 2025, up to a maximum aggregate amount of $350 million of shares of our Common Stock.

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We entered into an agreement in December 2024 to repurchase 15 million shares of Common Stock from a non-affiliate individual at a price per share of $6.95 for a total of $104 million under the 2024 Share Repurchase Plan. The transaction settled in January 2025, and we retired the shares. The 2024 Share Repurchase Plan expired in January 2025 with $5 million in authorized repurchases remaining.

In February 2025, our Board of Directors announced the 2025 Share Repurchase Plan, pursuant to which we were authorized to repurchase, through April 30, 2026, up to a maximum aggregate amount of $500 million of shares of our Common Stock.

The 2025 Share Repurchase Plan allowed us to purchase Common Stock, from time to time, in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act, or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and other factors. We were not obligated to repurchase any of our shares of Common Stock, and the timing and amount of any repurchases depended on legal requirements, market conditions, stock price, the availability of the safe harbor provided by Rule 10b-18 under the Exchange Act, alternative uses of capital, and other factors.

In March 2025, we repurchased, and subsequently retired, 20 million shares of our Common Stock under the 2025 Share Repurchase Plan and paid approximately $152 million (or $7.62 per share) in connection with a secondary offering of our Common Stock by Apollo.

Additionally, in March 2025, we repurchased, and subsequently retired, an additional 18 million shares of our Common Stock in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act under the 2025 Share Repurchase Plan in multiple transactions for a total of $140 million (or $7.79 per share).

Throughout the second quarter of 2025, we repurchased, and subsequently retired, 12 million shares of our Common Stock in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act under the 2025 Share Repurchase Plan in multiple transactions for a total of $96 million (or $8.14 per share).

In July 2025, we repurchased, and subsequently retired, 11 million shares of our Common Stock under the 2025 Share Repurchase Plan for $93 million (or $8.31 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo. Additionally, we repurchased, and subsequently retired, 2 million shares of our Common Stock in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act under the 2025 Share Repurchase Plan in multiple transactions for a total of $19 million (or $8.45 per share).

As of September 30, 2025, there were no authorized amounts remaining under the 2025 Share Repurchase Plan.

Other Contractual Obligations

As of September 30, 2025, we continue to work to meet our commitment of $200 million of aggregate purchases under the Google Cloud Agreement Addendum.

In addition, we are party to an agreement with one of our vendors to purchase at least $370 million of security system equipment and components through December 2025. As of December 31, 2024, the remaining amount under this commitment was $172 million. During the nine months ended September 30, 2025, purchases toward this commitment were $140 million.

Refer to Note 12 “Commitments and Contingencies.”

Cash Taxes

While we have historically made cash tax payments to certain states, starting in the second quarter of 2025, we began making federal cash tax payments. The specific payment amounts may fluctuate each quarter based on our financial results and tax positions taken.

Dividends

On November 4, 2025, we announced a dividend of $0.055 per share to holders of Common Stock and Class B Common Stock of record on December 11, 2025, which will be paid on January 8, 2026.

State Farm Opportunity Fund

On October 24, 2025, we repaid to State Farm substantially all of the balance of the Opportunity Fund held by us, which was classified as restricted cash as of September 30, 2025.

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Long-Term Debt

Significant changes and activity related to our long-term debt since our 2024 Annual Report are discussed below. Refer to Note 6 “Debt” for additional information.

First Lien Credit Agreement

In March 2025, we amended and restated the First Lien Credit Agreement and issued $600 million aggregate principal amount of the First Lien Term Loan B-2 due 2032, and received net proceeds of $597 million. The First Lien Term Loan B-2 due 2032 requires scheduled quarterly amortization payments, commencing on June 30, 2025, equal to 0.25% of the original principal amount of the First Lien Term Loan B-2 due 2032, with the remaining balance payable at maturity.

In July 2025, we further amended and restated the First Lien Credit Agreement, which provided for the issuance of $550 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $545 million. Additionally, we used net proceeds and cash on hand to redeem $550 million of the First Lien Notes due 2026.

Debt issuance costs were not material during the period.

During the nine months ended September 30, 2025, we borrowed and repaid $198 million under the First Lien Revolving Credit Facility. We had no amounts outstanding as of September 30, 2025.

In October 2025, we amended and restated the First Lien Credit Agreement, which provided for the issuance of $300 million of incremental borrowings under the First Lien Term Loan B-2 due 2032. We used the proceeds to partially redeem the Second Lien Notes due 2028. Also in October 2025, we partially redeemed $200 million of the First Lien Term Loan B due 2030 with proceeds from the Term Loan A due 2030.

Term Loan A due 2030 Issuance

In October 2025, we entered into a term loan credit agreement for an aggregate principal amount of $325 million of the Term Loan A due 2030. We used a portion of the proceeds to redeem $200 million of the First Lien Term Loan B due 2030 and intend to use the remaining proceeds for additional debt redemption.

First Lien Notes due 2033 Issuance

In October 2025, we issued $1 billion aggregate principal amount of the First Lien Notes due 2033. The Company used the net proceeds to redeem the majority of the Second Lien Notes due 2028.

First Lien Notes due 2026 Partial Redemptions

In March 2025, we redeemed $500 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $506 million, including a make-whole payment, using proceeds from the Company’s First Lien Term Loan B-2 due 2032.

In July 2025 we redeemed $550 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $554 million, including a make-whole payment, using proceeds from the Company’s issuance of the First Lien Term Loan B-2 due 2032 and cash on hand.

Loss on extinguishment of debt was not material.

We intend, and believe that we will have the ability through use of our ongoing sources of liquidity, or through refinancing, to redeem the remaining outstanding balance of these notes before maturity.

Second Lien Notes due 2028 Redemption

In October 2025, we redeemed the Second Lien Notes due 2028, using proceeds from the First Lien Notes due 2033, incremental borrowings under the First Lien Term Loan B-2 due 2032, and cash on hand.

2020 Receivables Facility

In March 2025, we amended the agreement governing the 2020 Receivables Facility to extend the uncommitted revolving period to March 2026, reduce the interest rate on outstanding borrowings, and increase the advance rate on pledged collateral.

As of September 30, 2025, the outstanding balance was $441 million.

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Debt Covenants

As of September 30, 2025, we were in compliance with all financial covenant and other maintenance tests for all our debt obligations. We do not believe there is a material risk of future noncompliance with our financial covenant and other maintenance tests.

Cash Flow Analysis

The amounts and discussion below include cash flows from both continuing operations and discontinued operations, as appropriate, consistent with the presentation on the Statements of Cash Flows.

			Nine Months Ended September 30,
(in thousands)			2025						2024						$ Change
Net cash provided by (used in):
Operating activities			$	1,510,585					$	1,425,223					$	85,362
Investing activities			$	(920,985)					$	(1,034,364)					$	113,379
Financing activities			$	(622,631)					$	(316,060)					$	(306,571)

Cash Flows from Operating Activities

The increase in net cash provided by operating activities, as compared to the prior year period, was primarily due to improved operating performance, changes in assets and liabilities due to the volume and timing of other operating cash receipts and payments with respect to when the transactions are reflected in earnings, lower interest payments, and the benefit of lower outflows in the current year related to our former Solar Business, partially offset by an increase in cash tax payments and a higher proportion of outright sales transactions. Refer to the discussions above under “—Results of Operations” for further details.

Cash Flows from Investing Activities

The majority of the decrease in net cash used in investing activities, as compared to the prior year period, was due to a decrease in subscriber system assets expenditures of $99 million primarily due to a higher proportion of outright sales in the current year.

Cash Flows from Financing Activities

The increase in net cash used in financing activities, as compared to the prior period, was primarily due to:

•higher share repurchases of $513 million, partially offset by

•net borrowings on long-term debt of $62 million during the current period primarily due to the issuance of the First Lien Term Loan B-2 due 2032, partially offset by the partial redemptions of the First Lien Notes due 2026, as compared to net repayments of $117 million during the prior period primarily due to the repayment of the First Lien Notes due 2024, and

•an increase in net borrowings on our 2020 Receivables Facility of $46 million due to timing of proceeds and the amendment in March 2025.

CRITICAL ACCOUNTING ESTIMATES

We disclosed our critical accounting estimates in our 2024 Annual Report, which include estimates prepared in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations.

Critical accounting estimates are based on, among other things, estimates, assumptions, and judgments made by management that include inherent risks and uncertainties. Our estimates are based on relevant information available at the end of each period. Actual results could differ materially from these estimates under different assumptions or market conditions.

There have been no material changes to our critical accounting estimates as disclosed in our 2024 Annual Report.

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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains certain information that may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and are made in reliance on the safe harbor protections provided thereunder. While we have specifically identified certain information as being forward-looking in the context of its presentation, we caution you that all statements contained in this Form 10-Q that are not clearly historical in nature, including statements regarding the ADT Solar Exit and the expected costs and benefits of such exit; the Commercial Divestiture; the expected benefits of the Commercial Divestiture and ADT Solar Exit, including that the costs of the ADT Solar Exit may exceed our best estimates; the expected favorable effect of the OBBBA on cash taxes; the integration of strategic bulk purchases of customer accounts; the strategic investment by and long-term partnership with State Farm; any repurchases of our common stock under an authorized share repurchase plan; anticipated financial performance, including the Company’s ability to achieve its stated guidance metrics; our ability to refinance or reduce debt or improve leverage ratios, or to achieve or maintain our leverage goals; anticipated financial performance, management’s plans and objectives for future operations; the successful development, commercialization, and timing of new or joint products; business prospects; outcomes of regulatory proceedings; market conditions; our ability to deploy our business continuity and disaster plans and procedures to successfully respond to catastrophic events; our strategic partnership and ongoing relationship with Google; the expected timing of product commercialization with Google or any changes thereto; the successful internal development, commercialization, and timing of our next generation platform and innovative offerings; the successful conversion of customers who continue to utilize outdated technology; the current and future market size for existing, new, or joint products; any stated or implied outcomes with regards to the foregoing; and other matters. Any stated or implied outcomes with regards to the foregoing are forward-looking.

Without limiting the generality of the preceding sentences, any time we use the words “ongoing,” “expects,” “intends,” “will,” “anticipates,” “believes,” “confident,” “continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “goals,” “objectives,” “targets,” “planned,” “projects,” and, in each case, their negative or other various or comparable terminology, and similar expressions, we intend to clearly express that the information deals with possible future events and is forward-looking in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking.

Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward- looking statements include, without limitation:

•our ability to retain and hire key personnel and to maintain relationships with customers, suppliers, and other business partners;

•risks related to the Commercial Divestiture and ADT Solar Exit, including our business becoming less diversified and the possible diversion of management’s attention from our core business operations;

•our ability to keep pace with rapid technological changes and other industry changes;

•risks related to the expansion and further development of our next-generation platform and our efforts to migrate our information technology infrastructure, including our customer relationship management and enterprise resource planning systems, to the cloud;

•our ability to effectively implement our strategic partnership or commercialize products with State Farm;

•our ability to effectively implement our strategic partnership with or utilize any of the amounts invested in us by Google;

•the impact of supply chain disruptions;

•our ability to maintain and grow our existing customer base and to integrate strategic bulk purchases of customer accounts;

•our ability to sell our products and services or launch new products and services in highly competitive markets, including the home security and automation market, and to achieve market acceptance with acceptable margins;

•our ability to successfully upgrade obsolete equipment installed at our customers’ premises in an efficient and cost-effective manner;

•any changes in regulations or laws, economic and financial conditions, including labor and tax law changes or any impacts on the global economy or consumer discretionary spending due to tariffs or otherwise, changes to privacy requirements, changes to telemarketing, email marketing and similar consumer protection laws, interest volatility, and trade tariffs and restrictions applicable to the products we sell;

•any impacts from current global, economic, sovereign and political conditions and uncertainties, including the effects of, and uncertainty regarding, new or proposed tariff or trade regulations;

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•any material changes to the valuation allowances we take with respect to our deferred tax assets;

•the impact of cyber attacks or related breaches with respect to information technology systems, cybersecurity, or data security involving us, our business partners, or other third parties whose systems are interconnected with ours, including the incidents disclosed in our Current Reports on Form 8-K filed with the SEC on August 8, 2024 (the “August Incident”) and October 7, 2024 (the “October Incident” and together with the August Incident, the “Cybersecurity Incidents”) and any similar future or still undetected attacks or incidents;

•risks related to the development, deployment, and use of artificial intelligence (“AI”) in our products and services, including technological and legal uncertainties surrounding AI technologies;

•our dependence on third-party providers, suppliers, and dealers to enable us to produce and distribute our products and services in a cost-effective manner that protects our brand;

•our ability to successfully implement an equipment ownership model that best satisfies the needs of our customers and to successfully implement and maintain our receivables securitization financing agreement or similar arrangements;

•our ability to successfully pursue alternate business opportunities and strategies;

•our ability to continue to integrate various businesses, including bulk acquisitions of customer accounts, we have acquired or will acquire in the future, in an efficient and cost-effective manner;

•the amount and timing of our cash flows and earnings, which may be impacted by customer, competitive, supplier and other dynamics and conditions;

•our ability to maintain or improve margins through business efficiencies;

•risks related to the restatement of our consolidated financial statements included in our Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2022 (the “Amended 2022 Annual Report”) and in our Quarterly Reports on Form 10-Q/A for the quarters ended September 30, 2022, and March 31, 2023, each as filed with the SEC on July 27, 2023;

•any litigation or investigation related to such restatements;

•our ability to maintain effective internal control over financial reporting (“ICFR”) and disclosure controls and procedures (“DCPs”), including our ability to remediate any potential material weakness in our ICFR and the timing of any such remediation, as well as the ability to maintain effective DCPs at a reasonable assurance level; and

•the other factors that are described under the heading “Risk Factors” in our last Annual Report on Form 10-K for the year ended December 31, 2024.

Forward-looking statements and information involve risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied in, or reasonably inferred from, such statements, including without limitation, the risks and uncertainties disclosed or referenced under the heading “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A in our 2024 Annual Report. Therefore, caution should be taken not to place undue reliance on any such forward-looking statements. Much of the information in this report that looks toward future performance is based on various factors and important assumptions about future events that may or may not actually occur. As a result, our operations and financial results in the future could differ materially and substantially from those we have discussed in the forward-looking statements included in this Quarterly Report on Form 10-Q. Any forward-looking statement made in this Quarterly Report on Form 10-Q speaks only as of the date on which it is made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future developments, or otherwise unless required by law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Our operations expose us to a variety of market risks, including the effects of changes in interest rates as we have both fixed-rate and variable-rate debt. We monitor and manage these financial exposures as an integral part of our overall risk management program. Our policies allow for the use of specified financial instruments for hedging purposes only. Use of derivatives for speculation purposes is prohibited.

There were no material changes in our interest rate risk exposure to that disclosed in our 2024 Annual Report, other than as described below.

A larger portion of our debt is subject to variable interest rates as of September 30, 2025 as compared to December 31, 2024. As of September 30, 2025, the principal balance of our debt, excluding finance leases, that was subject to a variable-rate was approximately less than 1% (including the impact of interest rate swaps) and approximately 45% (excluding the impact of interest rate swaps) of the total carrying amount of our debt.

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ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of September 30, 2025, our disclosure controls and procedures were effective at a reasonable assurance level in ensuring information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

Changes in Internal Control over Financial Reporting

During the three months ended September 30, 2025, there were no changes in our internal control over financial reporting (“ICFR”) identified in our management’s evaluation pursuant to Rules 13a-15(d) and 15d-15(d) of the Exchange Act that materially affected, or are reasonably likely to materially affect, our ICFR.

During 2023, we began a multi-year IT transformation project by which we are migrating much of ADT’s infrastructure to the cloud, including certain aspects of our customer relationship management and enterprise resource planning systems. We began the transition of our customer relationship management system in 2023, and during 2024, we began the transition to the new enterprise resource planning system, which will be completed in phases over multiple years.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

See Note 12 “Commitments and Contingencies” to the condensed consolidated financial statements under the heading “Legal Proceedings” included in this Quarterly Report on Form 10-Q for legal proceedings and related matters.

ITEM 1A. RISK FACTORS.

Our significant business risks are described in Part I, Item 1A “Risk Factors” in our 2024 Annual Report and in our other filings with the SEC. The risk factors described in our filings with the SEC and other information may not describe every risk facing the Company. There have been no material changes in our risk factors from those disclosed in our 2024 Annual Report.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Recent Sales of Unregistered Equity Securities

There were no sales of unregistered equity securities during the nine months ended September 30, 2025.

Use of Proceeds from Registered Equity Securities

We did not receive any proceeds from sales of registered equity securities during the nine months ended September 30, 2025.

Issuer Purchases of Equity Securities

The following table presents repurchases of shares of the Company’s Common Stock completed during the three months ended September 30, 2025 (in thousands, except per share amounts):

Period						Total Number of Shares Purchased						Average Price Paid Per Share(1)						Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)						Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands)
July 1, 2025 - July 31, 2025(3)						13,399						$	8.33					13,399						$	—
August 1, 2025 - August 31, 2025						—						$	—					—						$	—
September 1, 2025 - September 30, 2025						—						$	—					—						$	—
Total						13,399						$	8.33					13,399						$	—

_________________

(1)    The average price paid per share is calculated by dividing the total cash paid for the shares (including commissions) by the total number of shares repurchased.

(2)    In February 2025, the Company's Board of Directors announced the 2025 Share Repurchase Plan, pursuant to which the Company was authorized to repurchase, through April 30, 2026, up to a maximum aggregate amount of $500 million of shares of the Company's Common Stock. The 2025 Share Repurchase Plan allowed the Company to purchase Common Stock, from time to time, in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act, or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and other factors. As of September 30, 2025, the entire capacity available under the 2025 Share Repurchase Plan had been utilized, and there is no remaining authorized amounts outstanding under the 2025 Share Repurchase Plan.

(3)    The Company repurchased, and subsequently retired, 11 million shares of its Common Stock under the 2025 Share Repurchase Plan for an aggregate purchase price of $93 million (or approximately $8.31 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo. Refer to Note 14 “Related Party Transactions” for further information. The Company also repurchased, and subsequently retired, an additional 2 million shares of its Common Stock under the 2025 Share Repurchase Plan in the open market, including pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act, in multiple transactions at an average price of $8.45 per share. There were no remaining authorized amounts outstanding under the 2025 Share Repurchase Plan after these transactions.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

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ITEM 4. MINE SAFETY DISCLOSURES.

None.

ITEM 5. OTHER INFORMATION.

During the three months ended September 30, 2025, none of the Company’s directors or executive officers adopted or terminated any contract, instruction, or written plan for the purchase or sale of Company securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

ITEM 6. EXHIBITS.

The exhibits listed on the accompanying Index to Exhibits are filed/furnished or incorporated by reference as part of this Quarterly Report on Form 10-Q.

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INDEX TO EXHIBITS

The information required by this Item is set forth on the exhibit index below.

Exhibit Number

Incorporated by Reference

Exhibit Description

Form

Exhibit

Filing Date

3.1

Amended and Restated Certificate of Incorporation of ADT Inc.

10-Q

3.1

7/24/2025

3.2

Amended and Restated Bylaws of ADT Inc.

8-K

3.1

9/18/2023

4.1

First-Priority Senior Secured Notes Indenture, dated as of October 15, 2025, by and among The ADT Security Corporation, the guarantors party thereto, and Computershare Trust Company, N.A., as trustee.

8-K

4.1

10/15/2025

10.1

Incremental Assumption and Amendment Agreement No. 19, dated as of March 7, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the subsidiary loan parties party thereto, Barclays Bank PLC, as Administrative Agent, and the lenders party thereto.

8-K

10.1

3/10/2025

10.2

Incremental Assumption and Amendment Agreement No. 20, dated as of July 25, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the subsidiary loan parties party thereto, the lenders party thereto and Barclays Bank PLC, as administrative agent.

8-K

10.1

7/25/2025

10.3

Incremental Assumption and Amendment Agreement No. 21, dated as of October 24, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the subsidiary loan parties party thereto, the lenders party thereto and Barclays Bank PLC, as administrative agent.

8-K

10.1

10/28/2025

10.4

Seventh Amendment to the Receivables Financing Agreement, among ADT Finance LLC, Mizuho Bank, Ltd., ADT LLC, MUFG Bank, Ltd., Starbird Funding Corporation, and BNP Paribas, dated as of March 27, 2025.

8-K

10.1

4/2/2025

10.5+^

Retirement and Consulting Agreement, dated March 6, 2025 by and between The ADT Security Corporation (together with its subsidiaries, affiliates and successors) and Donald Young.

10-Q

10.3

4/24/2025

10.6+

Employment Offer Letter, dated September 12, 2023 between ADT LLC (together with its affiliates and successors) and David Scott.

10-Q

10.5

4/24/2025

10.7+†

Employment Offer Letter, dated March 18, 2025 between ADT LLC (together with its affiliates and successors) and Fawad Ahmad.

10-Q

10.5

7/24/2025

10.8

Term Loan Credit Agreement, dated as of October 28, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the lenders party thereto and Fifth Third Bank, National Association, as administrative agent.

8-K

10.2

10/28/2025

31.1*

Certification of CEO, pursuant to SEC Rule 13a-14(a) and 15d-14(a)

31.2*

Certification of CFO, pursuant to SEC Rule 13a-14(a) and 15d-14(a)

32.1**

Certification by the CEO, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2**

Certification by the CFO, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101

XBRL Instant Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

104

Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

_________________________

^ Certain schedules and similar attachments have been omitted. The Company agrees to furnish supplementally a copy of any omitted schedule or attachment to the SEC upon its request.

* Filed herewith.

** Furnished herewith.

+ Management contract or compensatory plan or arrangement.

† Previously refiled as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, filed with the SEC on July 24, 2025, to correct the exhibit previously filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, filed with the SEC on April 24, 2025.

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Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

						ADT Inc.
Date:			November 4, 2025			By:			/s/ Jeffrey Likosar
						Name:			Jeffrey Likosar
						Title:			President, Corporate Development and Transformation, and Chief Financial Officer (Principal Financial Officer)

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FAQ

How did ADT (ADT) perform in Q3 2025?

Revenue was $1,297,954,000 and net income was $145,132,000. Diluted EPS was $0.16.

What drove ADT’s revenue mix in Q3 2025?

Monitoring and related services were $1,097,561,000, with $200,393,000 from security installation, product, and other.

How did ADT’s interest expense change?

Q3 interest expense was $112,617,000, down from $161,830,000 last year, reflecting refinancing and hedging.

What cash flow did ADT generate year to date?

Net cash provided by operating activities for the nine months ended September 30, 2025 was $1,510,585,000.

What strategic portfolio changes did ADT make?

ADT sold its multifamily business on October 1, 2025 for approximately $56,000,000 after classifying it as held for sale.

What capital return did ADT provide?

ADT paid quarterly dividends of $0.055 per share and announced the same amount payable on January 8, 2026.

What were ADT’s shares outstanding?

As of October 28, 2025, common shares outstanding were 765,018,211 and Class B shares were 54,744,525.