Q4 ADT Earnings Call

March 2, 2026

Speaker #2: After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star, followed by the number one on your telephone keypad.

Speaker #2: If you would like to withdraw your question, simply press star one again. Thank you. I now like to turn the call over to Elizabeth Landers, Vice President, Investor Relations, you may begin.

Speaker #2: Good morning and thank you for joining us today to discuss ADT's fourth quarter and full year results. Speaking on today's call are Jim DeVries, ADT's Chairman, President, and CEO; Jeff Likosar, our CFO; and Omar Khan, our Chief Business Officer.

Operator: Good morning, and thank you for joining us today to discuss ADT's Q4 and full year results. Speaking on today's call are Jim DeVries, ADT's Chairman, President, and CEO, Jeff Likosar, our CFO, and Omar Khan, our Chief Business Officer. We are structuring today's call a bit differently, with the majority of the call focused on our strategy and key priorities to position ADT for the future. Jim will start with a broad strategic update, focusing on how we're reshaping the future of smart home security. Omar will then describe more about our recent acquisition of Origin AI, Jeff will briefly describe our 2025 financial results as well as our long-range financial outlook and capital allocation priorities. After their prepared remarks, we'll open the call for analyst questions. This morning, we issued a press release and presentation summarizing our financial results. Both are available at investor.adt.com.

Elizabeth Landers: Good morning, and thank you for joining us today to discuss ADT's Q4 and full year results. Speaking on today's call are Jim DeVries, ADT's Chairman, President, and CEO, Jeff Likosar, our CFO, and Omar Khan, our Chief Business Officer. We are structuring today's call a bit differently, with the majority of the call focused on our strategy and key priorities to position ADT for the future. Jim will start with a broad strategic update, focusing on how we're reshaping the future of smart home security. Omar will then describe more about our recent acquisition of Origin AI, Jeff will briefly describe our 2025 financial results as well as our long-range financial outlook and capital allocation priorities. After their prepared remarks, we'll open the call for analyst questions. This morning, we issued a press release and presentation summarizing our financial results. Both are available at investor.adt.com.

Speaker #2: We are structuring today's call a bit differently with the majority of the call focused on our strategy and key priorities to position ADT for the future.

Speaker #2: Jim will start with a broad strategic update, focusing on how we're reshaping the future of smart home security. Omar will then describe more about our recent acquisition of Origin AI.

Speaker #2: And then Jeff will briefly describe our 2025 financial results as well as our long-range financial outlook and capital allocation priorities. After they're prepared remarks, we'll open the call for analyst questions.

Speaker #2: This morning we issued a press release and presentation summarizing our financial results. Both are available at investor.adt.com. We'll reference our non-gap financial measures today.

Operator: We'll reference our non-GAAP financial measures today. Reconciliations to the most comparable GAAP measures are included in the earnings presentation on our website. Unless otherwise noted, all financials and metrics discussed reflect continuing operations. Non-GAAP cash flow measures include amounts related to our former solar business through Q2 2024. Included in our remarks today are a number of forward-looking statements that fall within the safe harbor provided by the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that are laid out in the earnings presentation on our website and in our SEC filings. Actual results may differ materially. Please refer to our SEC filings for more details. Now I'm happy to turn the call over to Jim.

Elizabeth Landers: We'll reference our non-GAAP financial measures today. Reconciliations to the most comparable GAAP measures are included in the earnings presentation on our website. Unless otherwise noted, all financials and metrics discussed reflect continuing operations. Non-GAAP cash flow measures include amounts related to our former solar business through Q2 2024. Included in our remarks today are a number of forward-looking statements that fall within the safe harbor provided by the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that are laid out in the earnings presentation on our website and in our SEC filings. Actual results may differ materially. Please refer to our SEC filings for more details. Now I'm happy to turn the call over to Jim.

Speaker #2: Reconciliations to the most comparable gap measures are included in the earnings presentation on our website. Unless otherwise noted, all financials and metrics discussed reflect continuing operations.

Speaker #2: Non-gap cash flow measures include amounts related to our former solar business through Q2 2024. Included in our remarks today are a number of forward-looking statements that fall within the safe harbor provided by the private securities litigation reform act.

Speaker #2: These forward-looking statements are subject to risks and uncertainties that are laid out in the earnings presentation on our website and in our SEC filings.

Speaker #2: Actual results may differ materially. Please refer to our SEC filings for more details. And now, I'm happy to turn the call over to Jim.

Speaker #3: Thanks, Elizabeth, and good morning, everyone. I'm pleased to report that ADT again delivered a solid quarter and that our overall performance for 2025 was within the guidance ranges we shared at the beginning of the year and updated on our October call.

Jim DeVries: Thanks, Elizabeth. Good morning, everyone. I'm pleased to report that ADT again delivered a solid quarter and that our overall performance for 2025 was within the guidance ranges we shared at the beginning of the year and updated on our October call. Jeff will share more regarding 2025 financial results later on this call, and he'll also comment on our longer-range financial outlook and capital allocation priorities. I'll spend the next several minutes sharing our vision for ADT and how we're reshaping smart home security, emphasizing our strategic focus areas, key initiatives, and investment priorities for 2026 and beyond. As you know, ADT is the most trusted brand in smart home security, and we have remained the leader in our space throughout our 150-year history.

Speaker #3: Jeff will share more regarding 2025 financial results later on this call, and he'll also comment on our longer-range financial outlook and capital allocation priorities.

Speaker #3: I'll spend the next several minutes sharing our vision for ADT and how we're reshaping smart home security emphasizing our strategic focus areas, key initiatives, and investment priorities for.

Speaker #3: 2026 and beyond. As you know, ADT is the most trusted brand in smart home security, and we have remained the leader in our space throughout our 150-year history.

Speaker #3: We have a national footprint, unmatched monitoring and service infrastructure, and long-standing relationships with millions of customers who rely on us every day. ADT's mission to protect and connect what matters most remains consistent.

Jim DeVries: We have a national footprint, unmatched monitoring and service infrastructure, and long-standing relationships with millions of customers who rely on us every day. ADT's mission to protect and connect what matters most remains consistent, and we are focused on providing peace of mind to our customers. As I've shared before, our overall strategy is anchored in three core differentiators: unrivaled safety, premium experience, and innovative offerings. We deliver best-in-class protection anchored by our professional monitoring and delivered with top-notch service. During my tenure as CEO, customer expectations, the state of technology, and the manner in which we fulfill our mission have evolved with increasing speed. Homes are more connected, technology is more intelligent, customer expectations regarding responsiveness, personalization, and convenience are higher than ever before. Security is no longer just about reacting to alarms.

Speaker #3: And we are focused on providing peace of mind to our customers. As I've shared before, our overall strategy is anchored in three core differentiators.

Speaker #3: Unrivaled safety, premium experience, and innovative offerings. We deliver best-in-class protection anchored by our professional monitoring and delivered with top-notch service. During my tenure as CEO, customer expectations, the state of technology, and the manner in which we fulfill our mission have evolved with increasing speed.

Speaker #3: Homes are more connected, technology is more intelligent, and customer expectations regarding responsiveness, personalization, and convenience are higher than ever before. Security is no longer just about reacting to alarms.

Speaker #3: We see the future of smart home security differently from the past, and ADT is leading the way to transform the delivery of, and even the definition of, smart home security.

Jim DeVries: We see the future of smart home security differ from the past. ADT is leading the way to transform the delivery of, and even the definition of, smart home security. At the core of that strategy is a simple idea, combining ADT's human experience with intelligent technologies to deliver better outcomes for our customers and with better economics for the business. More specifically, we're building technology that, combined with our more than 12,000 professionals, will provide solutions to provide increased peace of mind for our customers. Our vision is to provide protection that is always available, powered by artificial intelligence, enable real-time and split-second response with deeper information and context during emergencies, deliver a personalized experience that lives and evolves with the customer tailored to lifestyles and life stages, and offer solutions for everyone across all US households, small businesses, and families through a variety of use cases.

Speaker #3: At the core of that strategy is a simple idea: combining ADT's human experience with intelligent technologies to deliver better outcomes for our customers—and with better economics for the business.

Speaker #3: More specifically, we're building technology that combines with our more than 12,000 professionals will provide solutions to provide increased peace of mind for our customers.

Speaker #3: Our vision is to provide protection that is always available, powered by artificial intelligence, enable real-time and split-second response with deeper information and context during emergencies, deliver a personalized experience, that lives and evolves with the customer, tailored to lifestyles, and life stages.

Speaker #3: And offer solutions for everyone across all U.S. households, small businesses, and families through a variety of use cases. Protection that follows people, not just properties.

Jim DeVries: Protection that follows people, not just properties. We have made substantial progress in the foundation for this vision in recent years. These include the launch and expansion of our ADT+ platform and features, the transition to virtual service, early accomplishments in AI, and consistent improvements in our go-to-market model. A key objective during 2026 is to invest in the acceleration and broadening of our progress. We're investing in product technology, both in ADT+ as well as in our new technology related to ambient sensing. We're investing in customer service and artificial intelligence, as well as our related IT infrastructure. We're investing in customer acquisition efficiency, including marketing to new segments and refining our channel strategy. I'd like to share a little more detail on these key investments in 2026. First, investments in product technology.

Speaker #3: We have made substantial progress in the foundation for this vision in recent years. These include the launch and expansion of our ADT Plus platform and features.

Speaker #3: The transition to virtual service, early accomplishments in AI, and consistent improvements in our go-to-market model. A key objective during 2026 is to invest in the acceleration and broadening of our progress.

Speaker #3: We're investing in product technology, both in ADT Plus as well as in our new technology related to ambient sensing. We're investing in customer service and artificial intelligence as well as our related IT infrastructure.

Speaker #3: And we're investing in customer acquisition efficiency, including marketing to new segments and refining our channel strategy. I'd like to share a little more detail on these key investments in 2026.

Speaker #3: First, investments in product technology. We have built a solid proprietary platform which enables more rapid innovation and more explicit differentiation. Following the launch of trusted neighbor in late 2024, we continue to add more use cases and features.

Jim DeVries: We have built a solid proprietary platform which enables more rapid innovation and more explicit differentiation. Following the launch of Trusted Neighbor in late 2024, we continue to add more use cases and features. Just recently, we launched Live Light, a lighted outdoor ADT sign enabling first responders to visually identify and verify an address during an emergency. We also launched My Safety, enabling on-the-go mobile security integrated with the ADT+ ecosystem. We are expanding penetration of our ADT+ app to more channels, including, most importantly, a third-party network of more than 100 dealers who will transition to ADT+ in Q3. A topic which I'm very excited about is our recent acquisition of Origin AI, which, using advanced presence sensing technologies and intelligence, will enable use cases and features unique to ADT.

Speaker #3: Just recently, we launched live light, a lighted outdoor ADT sign enabling first responders to visually identify and verify and address during an emergency. We also launched my safety, enabling on-the-go mobile security integrated with the ADT Plus ecosystem.

Speaker #3: We are expanding penetration of our ADT Plus app to more channels including most importantly, a third-party network of more than 100 dealers who will transition to ADT Plus in the third quarter.

Speaker #3: A topic which I'm very excited about is our recent acquisition of Origin AI, which, using advanced presence sensing technologies and intelligence, will enable use cases and features unique to ADT.

Jim DeVries: Omar Khan, our Chief Business Officer, will share more detail about Origin AI shortly. The theme of our customer service initiatives is the power we can uniquely bring to our customer by supplementing our 12,000 employees with the power of artificial intelligence. We've made substantial progress in service and efficiency in recent years. A highlight is our virtual service initiatives, under which we now handle approximately 50% of our service calls via remote diagnosis and resolution rather than utilizing a truck roll. This has led to meaningful customer service through improvements with positive feedback while also improving our cost efficiency. In addition, our initial artificial intelligence efforts in 2025 have led to 23% of our calls being routed through AI with steadily improving levels of containment, that is, handling the call without any human engagement.

Speaker #3: Omar Khan, our Chief Business Officer, will share more detail about Origin AI shortly. The theme of our customer service initiatives is the power we can uniquely bring to our customer by supplementing our 12,000 employees with the power of artificial intelligence.

Speaker #3: We've made substantial progress in service inefficiency in recent years, a highlight is our virtual service initiatives under which we now handle approximately 50% of our service calls via remote diagnosis and resolution rather than utilizing a truck roll.

Speaker #3: This has led to meaningful customer service through improvements with positive feedback while also improving our cost efficiency. In addition, our initial artificial intelligence efforts in 2025 have led to 23% of our calls being routed through AI with steadily improving levels of containment, that is, handling the call without any human engagement.

Speaker #3: We exited 2025 with all of our chats first routed through AI. Importantly, we continue to benefit from highly trained employees available in situations where a human interaction is the best solution.

Jim DeVries: We exited 2025 with all of our chats first routed through AI. Importantly, we continue to benefit from highly trained employees available in situations where a human interaction is the best solution, both in the event of an emergency or when an on-site service visit is the best way to resolve a customer concern. During 2026, we are planning to advance our service-oriented artificial intelligence within our call center operation and, importantly, also invest in AI beyond our call centers. Our primary focus is to strengthen our understanding of customers, which we'll accomplish via transcription and analysis of a large percentage of customer interactions with our agents. We use these insights to improve our interactions, in some cases by prompting employee agents and in other cases, reducing the need for human involvement.

Speaker #3: Both in the event of an emergency or when an on-site service visit is the best way to resolve a customer concern. During 2026, we are planning to advance our service-oriented artificial intelligence within our call center operation and, importantly, also invest in AI beyond our call centers.

Speaker #3: Our primary focus is to strengthen our understanding of customers. Which will accomplish via transcription and analysis of a large percentage of customer interactions with our agents.

Speaker #3: We'll use these insights to improve our interactions in some cases by prompting employee agents and in other cases reducing the need for human involvement.

Speaker #3: I'm especially excited by the opportunities here to proactively identify and resolve customer needs or desires rather than reactively after a customer reaches out to us.

Jim DeVries: I'm especially excited by the opportunities here to proactively identify and resolve customer needs or desires rather than reactively after a customer reaches out to us. We anticipate this rich information will facilitate improvements in customer satisfaction, speed of issue resolution, and cost efficiency. Working with an outstanding AI partner, Sierra, we're also beginning to leverage artificial intelligence within our lead to sale processes, which we believe will bring higher levels of conversion. The third area in which we're making 2026 investments is improvements in new segments and acquisition efficiency. We already enjoy the benefits of a very strong and trusted brand and a variety of routes to market. During 2025, we shifted a majority of our sales transactions to a model that effectively combines sales with system design, configuration, and installation into a single role, most often accomplished in a single home visit.

Speaker #3: We anticipate this rich information will facilitate improvements in customer satisfaction, speed of issue resolution, and cost efficiency. Working with an outstanding AI partner, Sierra, we're also beginning to leverage artificial intelligence within our lead-to-sale processes which we believe will bring higher levels of area in which we're making 2026 investments is improvements in new segments and acquisition efficiency.

Speaker #3: We already enjoy the benefits of a very strong and trusted brand and a variety of routes to market. During 2025, we shifted a majority of our sales transactions to a model that effectively combines sales, with system design, configuration, and installation into a single role.

Speaker #3: Most often, accomplished in a single home visit. We also refreshed our advertising platform to our When-Every-Second-Counts campaign, and we continue to benefit from our capabilities to selectively buy accounts in bulk and integrate them into ADT.

Jim DeVries: We also refreshed our advertising platform to our When Every Second Counts campaign. We continue to benefit from our capabilities to selectively buy accounts in bulk and integrate them into ADT. Among our key priorities in 2026 is expansion into e-commerce channels and the launch of a new product line, which we're calling ADT Blue, to appeal specifically to more value-conscious and DIY customers. This will include more marketing investment to target those customers more specifically than we have in the past. We believe our ADT Blue launch will help us acquire customers for both our DIY and DIFM solutions as we now appear in e-tail channels where many customers shop. In addition, we're refining our overall marketing approach with an objective of rationalizing our highest cost acquisition sources, which includes affiliate marketing partners and in some cases, our dealers.

Speaker #3: Among our key priorities in 2026 is expansion into e-commerce channels and the launch of a new product line which we're calling ADT Blue to appeal specifically to more value-conscious and DIY customers.

Speaker #3: This will include more marketing investment to target those customers, more specifically than we have in the past. We believe our ADT Blue launch will help us acquire customers for both our DIY and DIFM solutions as we now appear in e-tail channels where many customers shop.

Speaker #3: In addition, we're refining our overall marketing approach with an objective of rationalizing our highest-cost acquisition sources which includes affiliate marketing partners and in some cases our dealers, we expect this to have a near-term effect of reducing our organic new subscriber additions while strengthening longer-term economics for our overall go-to-market ecosystem.

Jim DeVries: We expect this to have a near-term effect of reducing our organic new subscriber additions while strengthening longer-term economics for our overall go-to-market ecosystem. We'll also continue to evaluate bulk account purchase options and potentially full acquisition opportunities in our industry with attractive economics. Our intent and core objectives are threefold. The first is to drive more growth. This includes in our core residential business as well as DIY-oriented or more price-conscious consumers, along with small businesses, and aging-in-place or health-oriented customers. The second is to strengthen customer loyalty, improving our customer retention. The third is to improve efficiency, specifically in customer acquisition to fund growth. Overall, we are focused on delivering unparalleled and differentiated customer value propositions, capitalizing on large and fast-growing smart home and security markets.

Speaker #3: We'll also continue to evaluate bulk account purchase options and potentially full acquisition opportunities in our industry with attractive economics. Our intent and core objectives are threefold.

Speaker #3: The first is to drive more growth. This includes in our core residential business, as well as DIY-oriented or more price-conscious consumers, along with small businesses and aging-in-place or health-oriented customers.

Speaker #3: The second is to strengthen customer loyalty, improving our customer retention. And the third is to improve efficiency specifically in customer acquisition to fund growth.

Speaker #3: Overall, we are focused on delivering unparalleled and differentiated customer value propositions capitalizing on large and fast-growing smart home and security markets. Our scale, our professional monitoring expertise, our employees, our advanced technologies, and our installed base give us advantages that are very difficult to replicate.

Jim DeVries: Our scale, our professional monitoring expertise, our employees, our advanced technologies, and our installed base give us advantages that are very difficult to replicate. Our 2026 initiatives and investments are designed to create the next generation of smart home security. We expect these initiatives to generate benefits, including growth in our core, expanded participation into adjacent TAMs, improved attrition, and greater efficiency. We have the team in place to execute this strategy. We are building on ADT's strengths while revolutionizing the manner in which we deliver smart home security. We're focused and disciplined and absolutely committed to creating long-term value for our customers and shareholders. Before Jeff Likosar shares more about our financial outlook and capital allocation plans, I'll turn the call to Omar, who will share more about why we're so excited about our acquisition of Origin AI. Omar.

Speaker #3: Our 2026 initiatives and investments are designed to create the next generation of smart home security. We expect these initiatives to generate benefits including growth in our core, expanded participation into adjacent TAMs, improved attrition, and greater efficiency.

Speaker #3: We have the team in place to execute this strategy. We are building on ADT's strengths while revolutionizing the manner in which we deliver smart home security.

Speaker #3: We're focused and disciplined and absolutely committed to creating long-term value for our customers and shareholders. Before Jeff shares more about our financial outlook and capital allocation plans, I'll turn the call to Omar who will share more about why we're so excited about our acquisition of Origin AI.

Speaker #3: Omar? Thanks, Jim, and good morning, everyone. Last week marked a defining milestone in ADT's history with the acquisition of Origin AI. This acquisition reflects a strategic decision to integrate ambient intelligence directly into our platform, unveiling the next layer of home intelligence.

Omar Khan: Thanks, Jim. Good morning, everyone. Last week marked a defining milestone in ADT's history with the acquisition of Origin AI. This acquisition reflects a strategic decision to integrate ambient intelligence directly into our platform, unveiling the next layer of home intelligence. two years ago, we launched our proprietary platform, ADT+, which we have been advancing and scaling with hardware and software features to support additional channels and customer types. We expect AI sensing to become an integrated offering for ADT+ customers over the next 12 to 18 months, advancing all aspects of our product and services platform. With this acquisition, we now own what we believe to be the world's leading Wi-Fi-based signal processing engine, algorithms, and AI models, backed by over 200 global patents and 50 talented innovators.

Speaker #3: Two years ago, we launched our proprietary platform, ADT Plus, which we have been advancing and scaling with hardware and software features to support additional channels and customer types.

Speaker #3: We expect AI sensing to become an integrated offering for ADT Plus customers over the next 12 to 18 months. Advancing all aspects of our product and services platform.

Speaker #3: With this acquisition, we now own what we believe to be the world’s leading Wi-Fi-based signal processing engine algorithms and AI models, backed by over 200 global patents and 50 talented innovators.

Speaker #3: Think of it as a sixth sense that knows what's happening inside the home without the use of cameras or listening devices. This technology uses existing Wi-Fi signals, the ones that are already bouncing off your walls and off your body, and uses proprietary algorithms and AI models to interpret the smallest changes in deflections.

Omar Khan: Think of it as a sixth sense that knows what's happening inside the home without the use of cameras or listening devices. This technology uses existing Wi-Fi signals, the ones that are already bouncing off your walls and off your body, and uses proprietary algorithms and AI models to interpret the smallest changes in deflections. We call it AI sensing. It can distinguish a human from a dog, a fall from a nap, and even detect a person's breathing patterns, all without requiring a single wearable device or a camera. This is a privacy-first security that solves notification fatigue by significantly reducing false alarms and providing zone-based knowledge of where someone is in the home when there is a life safety incident. Why Origin? Because they've spent years perfecting the intellectual property that everyone else is just starting to talk about. For ADT, this is foundational.

Speaker #3: We call it AI sensing. It can distinguish a human from a dog, a fall from a nap, and even detect a person's breathing patterns, all without requiring a single wearable device or a camera.

Speaker #3: This is a privacy-first security that solves notification fatigue by significantly reducing false alarms and providing zone-based knowledge of where someone is in the home when there is a life safety incident.

Speaker #3: Why Origin? Because they've spent years perfecting the intellectual property that everyone else is just starting to talk about. For ADT, this is foundational. It allows us to evolve from the best-in-class reactive alarm company to a proactive peace-of-mind company.

Omar Khan: It allows us to evolve from the best-in-class reactive alarm company to a proactive peace-of-mind company and build new use cases, such as smart aging, allowing families to monitor elderly parents for falls or changes in gait. It's also incredibly scalable. Because it works on existing Wi-Fi signals, we expect that we can, over time, turn on these features for certain of our 6 million existing households via software updates and simple hardware like smart plugs. Our consumer market research shows customers have a high demand and willingness to pay for these AI-verified presence, motion classification, and health-related features. Simultaneous with the acquisition, we've signed a 5-year agreement with a minimum value of $30 million plus activation fees with Verisure, the leading smart home security provider in Europe and Latin America, who will continue to scale Origin technology across their footprint.

Speaker #3: And build new use cases such as smart aging, allowing families to monitor elderly parents for falls or changes in gait. It's also incredibly scalable.

Speaker #3: Because it works on existing Wi-Fi signals, we expect that we can, over time, turn on these features for certain of our 6 million existing households via software updates and simple hardware like smart plugs.

Speaker #3: Our consumer market research shows customers have a high demand and willingness to pay for these AI-verified presence motion classification and health-related features. Simultaneous with the acquisition, we've signed a five-year agreement with a minimum value of $30 million plus activation fees with Verisure, the leading smart home security provider in Europe and Latin America who will continue to scale Origin's technology across their footprint.

Speaker #3: We believe, over time, our newly acquired technology will accelerate our user engagement, increase our role in customers' lives, drive subscriber and RMR growth, and will reduce our subscriber acquisition cost.

Omar Khan: We believe over time, our newly acquired technology will accelerate our user engagement, increase our role in customers' lives, drive subscriber and RMR growth, and will reduce our subscriber acquisition cost. We expect to launch a pilot this year with the commercialization across the ADT+ platform and app starting in 2027. In short, we now own the brain of the smart home. We are moving the industry from, Did the door open? to, Is my family okay? We are doing it with the most advanced, privacy-compliant AI on the market. I'll now turn the call over to Jeff and look forward to answering any of your questions related to Origin and product strategy for ADT.

Speaker #3: We expect to launch a pilot this year with the commercialization across the ADT Plus platform and app starting in 2027. In short, we now own the brain of the smart home.

Speaker #3: We are moving the industry from did a door open to is my family okay? And we are doing it with the most advanced privacy-compliant AI on the market.

Speaker #3: I'll now turn the call over to Jeff and look forward to answering any of your questions related to Origin and product strategy for ADT.

Speaker #1: Thanks, Omar, and good morning, everyone. I'll take just a couple of minutes to highlight our fourth quarter in 2025 financial results, which you can see in the deck and press release we issued earlier this morning.

Jim DeVries: Thanks, Omar, good morning, everyone.

Jeff Likosar: Thanks, Omar, good morning, everyone.

Jeff Likosar: I'll take just a couple minutes to highlight our Q4 in 2025 financial results, which you can see in the deck and press release we issued earlier this morning. As Jim mentioned, we are very pleased with our overall performance, with all guidance measurements within the ranges we shared at the beginning of the year and updated in our October call. We continued to focus especially on strong cash generation. We grew our adjusted free cash flow, including interest rate swaps, by 16% in 2025. This reflects our disciplined capital allocation and our balanced approach to investing in our business while also returning capital to shareholders. Along with our capital structure improvements, this enabled us to return nearly $800 million of capital directly to shareholders during 2025.

Speaker #1: As Jim mentioned, we are very pleased with our overall performance, with all guidance measurements within the ranges we shared at the beginning of the year and updated in our October call.

Speaker #1: We continue to focus especially on strong cash generation, and we grew our adjusted free cash flow, including interest rate swaps, by 16% in 2025.

Speaker #1: This reflects our disciplined capital allocation and our balanced approach to investing in our business while also returning capital to shareholders. Along with our capital structure improvements, this enabled us to return nearly $800 million of capital directly to shareholders during 2025.

Speaker #1: This included roughly $600 million in share repurchases and $187 million in dividends. Full-year revenue was $5.1 billion, up 5%, with adjusted EBITDA of $2.68 billion up 4%.

Jeff Likosar: This included roughly $600 million in share repurchases and $187 million in dividends. Full year revenue was $5.1 billion, up 5%, with adjusted EBITDA of $2.68 billion, up 4%. The key positive year-over-year drivers included growth in monitoring and services revenue, higher install revenues and margins, efficiency improvements, and general cost controls, enabling funding of our investment priorities. Adjusted EPS was exceptionally strong, up 19% to $0.89 per share, benefiting from EBITDA growth and lower share count. Attrition ended at 13.1% behind our record level from earlier in 2025, due mainly to elevated non-pay disconnects. As a reminder, we divested our multifamily business in October, which represented approximately $2.6 million in RMR from roughly 200,000 subscribers.

Speaker #1: The key positive year-over-year drivers included growth in monitoring and services revenue, higher install revenues and margins, efficiency improvements, and general cost controls enabling funding of our investment priorities.

Speaker #1: Adjusted EPS was exceptionally strong, up 19% to $0.89 per share, benefiting from EBITDA growth and lower share count. Attrition ended at 13.1%, behind our record level from earlier in 2025 due mainly to elevated non-paid disconnects.

Speaker #1: As a reminder, we divested our multifamily business in October, which represented approximately $2.6 million in RMR from roughly 200,000 subscribers. Including the effect of this disposition, our 2025 ending RMR balance was approximately flat to 2024.

Jeff Likosar: Including the effect of this disposition, our 2025 ending RMR balance was approximately flat to 2024. I'll touch more on our capital structure and flexibility in a moment, but want to also highlight that we reduced our leverage to 2.7x adjusted EBITDA with several debt transactions during 2025. During the Q4, these included refinancing of our 2028 notes and all but $75 million of our April 2026 notes. Our 2025 performance and progress positions us well heading into 2026, where, as Jim described, we are focused on executing several initiatives that position us for the future. I'll spend the rest of the time describing how these key initiatives and priorities fit into our financial model and our commitment to generating shareholder returns.

Speaker #1: I'll touch more on our capital structure and flexibility in a moment, but want to also highlight that we reduced our leverage to 2.7 times adjusted EBITDA with several debt transactions during 2025.

Speaker #1: During the fourth quarter, these included refinancing of our 2028 notes and all but $75 million of our April 2026 notes. Our 2025 performance and progress positions us well heading into 2026 where, as Jim described, we are focused on executing several initiatives that position us for the future.

Speaker #1: I'll spend the rest of the time describing how these key initiatives and priorities fit into our financial model and our commitment to generating shareholder returns.

Speaker #1: The strategy we're executing is designed to reinforce and build upon the strengths of our business model, stable, recurring revenue, strong margins, durable free cash flow, and more recently, our capital allocation flexibility.

Jeff Likosar: The strategy we're executing is designed to reinforce and build upon the strengths of our business model, stable recurring revenue, strong margins, durable free cash flow, and more recently, our capital allocation flexibility. As we invest in technology, service excellence, and more efficient customer acquisition, our goal is to improve long-term growth in unit economics, not just near-term results. We enjoy very durable recurring revenue resulting from our annuity-like $4.3 billion annualized recurring monthly revenue balance. With its high gross margins, this is a core asset and the foundation of our cash generation and shareholder return capabilities. We have been very disciplined in management of that asset in recent years, with a focus especially on growing our cash generation while continuing to invest in our business. Our 2025 adjusted free cash flow, including interest rate swaps, has more than doubled since 2021.

Speaker #1: As we invest in technology, service excellence, and more efficient customer acquisition, our goal is to improve long-term growth and unit economics, not just near-term results.

Speaker #1: We enjoy very durable, recurring revenue resulting from our annuity-like $4.3 billion annualized recurring monthly revenue bounce. With its high gross margins, this is a core asset and the foundation of our cash generation and shareholder return capabilities.

Speaker #1: We have been very disciplined in management of that asset in recent years with a focus especially on growing our cash generation while continuing to invest in our business.

Speaker #1: Our 2025 adjusted free cash flow including interest rate swaps has more than doubled since 2021. During that period, we have generated more than $3 billion of adjusted free cash flow while investing in subscriber acquisition spending sufficient to have grown our recurring monthly revenue bounce by 9%.

Jeff Likosar: During that period, we have generated more than $3 billion of adjusted free cash flow while investing in subscriber acquisition spending sufficient to have grown our recurring monthly revenue balance by 9%. Our focus on unit economics, facilitated by higher install revenue per unit, has contributed to that progress. We've also invested in the technologies and infrastructure that provide the foundation for the growth initiatives we have described today, and we will continue to invest in 2026. Because we believe our stock is very attractively priced, we have also prioritized capital allocation towards repurchase in recent years. Including dividends, we have returned $1.6 billion to shareholders since 2021. Our flexibility to do this is enabled by the refinancing transactions I mentioned earlier and are having repaid more than $2 billion of debt during that time.

Speaker #1: Our focus on unit economics, facilitated by higher install revenue per unit, has contributed to that progress. We've also invested in the technologies and infrastructure that provide the foundation for the growth initiatives we have described today, and we will continue to invest in 2026.

Speaker #1: Because we believe our stock is very attractively priced, we have also prioritized capital allocation towards repurchase in recent years. Including dividends, we have returned $1.6 billion to shareholders since 2021.

Speaker #1: Our flexibility to do this is enabled by the refinancing transactions I mentioned earlier and are having repaid more than $2 billion of debt during that time.

Speaker #1: As we enter 2026, our commitment to shareholder returns is stronger than ever. We expect the initiatives Jim outlined to generate more growth, improve customer loyalty, and strengthen subscriber acquisition efficiency.

Jeff Likosar: As we enter 2026, our commitment to shareholder returns is stronger than ever. We expect the initiatives Jim outlined to generate more growth, improve customer loyalty, and strengthen subscriber acquisition efficiency. We are targeting 1 million more subscribers by 2030, with growth both in our core markets and adjacencies such as DIY and aging in place or health applications. We are targeting 11% attrition with loyalty from expanded use cases and our commitment to customer service. We are targeting a 2-year revenue payback enabled by our broadened channel presence and reduced reliance on high-cost acquisition methods. We are consequently sharing today a multi-year financial framework that targets compounded annual growth rates of 5% for revenue, 10% for EPS, and adjusted free cash flow in excess of 10%.

Speaker #1: We are targeting 1 million more subscribers by 2030, with growth both in our core markets and adjacencies such as DIY and aging-in-place or health applications.

Speaker #1: We are targeting 11% attrition with loyalty from expanded use cases and our commitment to customer service. And we are targeting a two-year revenue payback enabled by our broadened channel presence and reduced reliance on high-cost acquisition methods.

Speaker #1: We are consequently sharing today a multi-year financial framework that targets compounded annual growth rates of 5% for revenue, 10% for EPS, and adjusted free cash flow in excess of 10%.

Speaker #1: As part of our commitment to return capital directly to shareholders, we are today announcing a new three-year 1.5 billion share repurchase authorization. And we are maintaining our existing 5.5 cents per share quarterly dividend.

Jeff Likosar: As part of our commitment to return capital directly to shareholders, we are today announcing a new three-year, $1.5 billion share repurchase authorization. We are maintaining our existing five and a half cents per share quarterly dividend. Beyond direct shareholder returns, we also anticipate allocating more capital to M&A than we have in recent years. Some of this may be in the form of technology or capability development, as in our recent acquisition of Origin AI, and some may be in the form of footprint expansion or account acquisitions. We will also continue to responsibly manage our debt levels. While we are very comfortable with our current capital structure, we anticipate continuing to reduce leverage, targeting 2.5x adjusted EBITDA.

Speaker #1: Beyond direct shareholder returns, we also anticipate allocating more capital to M&A than we have in recent years. Some of this may be in the form of technology or capability development, as in our recent acquisition of Origin AI, and some may be in the form of footprint expansion or account acquisitions.

Speaker #1: We will also continue to responsibly manage our debt levels. While we are very comfortable with our current capital structure, we anticipate continuing to reduce leverage, targeting 2.5 times adjusted EBITDA.

Speaker #1: Relative to our longer-range framework, we expect 2026 will have very strong cash generation, for which we are targeting 20% growth, which is above our multi-year framework.

Jeff Likosar: Relative to our longer-range framework, we expect 2026 will have very strong cash generation, for which we are targeting 20% growth, which is above our multi-year framework, with some offsetting pressure in 2027 from higher cash taxes and interest next year. We expect lower 2026 growth in revenue and EPS, both of which we expect to be approximately flat to 2025. This reflects our prioritization of cash generation in share repurchases. We are also investing approximately $50 million during 2026 in the product technology service and go-to-market initiatives Jim described. Like all companies, we face an uncertain tariff environment, and our guidance includes approximately $45 million in additional subscriber acquisition costs from tariffs. Our guidance does not include the purchase accounting effects of our Origin acquisition. We will provide an update on this on our next call.

Speaker #1: With some offsetting pressure in 2027 from higher cash taxes and interest next year, we expect lower 2026 growth in revenue and EPS, both of which we expect to be approximately flat to 2025.

Speaker #1: This reflects our prioritization of cash generation and share repurchases. We are also investing approximately $50 million during 2026 in the product technology, service, and go-to-market initiatives Jim described.

Speaker #1: Like all companies, we face an uncertain tariff environment, and our guidance includes approximately $45 million in additional subscriber acquisition costs from tariffs. Our guidance does not include the purchase accounting effects of our Origin acquisition.

Speaker #1: We will provide an update on this on our next call. We expect this year's full-year cash generation to be skewed towards the first quarter, driven by seasonally lower SAC spend and several timing items.

Jeff Likosar: We expect this year's full-year cash generation to be skewed towards Q1, driven by seasonally lower SAC spend and several timing items. To conclude my remarks, I want to emphasize why we see ADT as such a compelling investment. We own the most trusted brand in the smart home security space. Our valuation is underpinned by a stable, resilient, and recession-resistant recurring revenue base. We enjoy an unmatched footprint and scale with an unwavering commitment to delivering peace of mind. We increasingly own proprietary technologies and are leveraging artificial intelligence to improve both service and efficiency. We have demonstrated an ability to generate exceptionally strong free cash flow, which we have deployed in a disciplined fashion. Our flexibility from this cash generation and our efficient and well-laddered debt structure affords sufficient flexibility to return capital directly to shareholders.

Speaker #1: To conclude my remarks, I want to emphasize why we see ADT as such a compelling investment. We own the most trusted brand in the smart home security space.

Speaker #1: Our valuation is underpinned by a stable, resilient, and recession-resistant recurring revenue base. We enjoy an unmatched footprint and scale, with an unwavering commitment to delivering peace of mind.

Speaker #1: We increasingly own proprietary technologies and are leveraging artificial intelligence to improve both service and efficiency. We have demonstrated an ability to generate exceptionally strong free cash flow, which we have deployed in a disciplined fashion, and our flexibility from this cash generation and our efficient and well-laddered debt structure afford sufficient flexibility to return capital directly to shareholders.

Speaker #1: Overall, we are very pleased with our 2025 results and are excited by our future. Thank you again, everyone, for joining our call today. And thank you also to our more than 6 million customers, our more than 12,000 employees, and to the first responders across the United States.

Jeff Likosar: Overall, we are very pleased with our 2025 results and are excited by our future. Thank you again, everyone, for joining our call today. Thank you also to our more than 6 million customers, our more than 12,000 employees, and to the first responders across the United States. Operator, please open the call to questions.

Speaker #1: Operator, please open the call to questions.

Speaker #2: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one in your telephone keypad.

Operator: Thank you. We will now begin the question-and-answer session. If you would like to ask a question, please press star one in your telephone keypad. If you would like to withdraw that question, again, press star one. We ask that you please limit yourself to one question and one follow-up. Your first question today comes from the line of George Tong from Goldman Sachs. Your line is open.

Speaker #2: If you would like to withdraw that question, again, press star one. We ask that you please limit yourself to one question and one follow-up.

Speaker #2: Your first question today comes from the line of George Tong from Goldman Sachs. Your line is open.

Speaker #3: Hi, thanks. Good morning. You're guiding to 2026 revenue and EPS to be flat. You touched on the tariff impact that you expect this year on subscriber acquisition costs.

George Tong: Hi. Thanks. Good morning. You're guiding to 2026 revenue and EPS to be flat. You touched on the tariff impact that you expect this year on subscriber acquisition costs. Can you talk more about factors that you expect to constrain revenue and EPS performance this year?

Speaker #3: Can you talk more about factors that you expect to constrain revenue and EPS performance this year?

Jim DeVries: Sure, George. It's Jim. Thanks for the first question. I'll touch on revenue. Jeff, you wanna hit earnings? On the flat revenue, we're certainly aspiring to do better than flat in 2026. Entering our year with RMR roughly flat to last year. As you know, recurring revenue makes up 85% of our revenue. If we're coming in flat to last year, that's a headwind for 2026. We have also about 1 point of headwind from the sale of our multifamily business. George, you asked about some of the factors which might impact it. Some of the changes that we're contemplating in dealer and affiliate partnerships have the potential for short-term disruption. I wanna mention I'm bullish on these investments.

Speaker #4: Sure, George. It's Jim. Thanks for the first question. I'll touch on revenue, and Jeff, do you want to hit earnings? So, on the flat revenue, we're certainly aspiring to do better than flat in 2026, entering our year with RMR roughly flat to last year.

Speaker #4: As you know, recurring revenue makes up 85% of our revenue. And so, if we're coming in flat to last year, that's a headwind for 2026.

Speaker #4: We have also about a point of headwind from the sale of our multifamily business. And then, George, you asked about some of the factors which might impact it.

Speaker #4: Some of the changes that we're contemplating in dealer and affiliate partnerships have the potential for short-term disruption. I want to mention, I'm bullish on these investments.

Jim DeVries: You know, we're excited about ambient sensing, entry into some of the new TAMs, retail, e-commerce. We have a brand new CMO who brings a great deal of experience and talent to the table. I see no reason why after our investments, we get back to our 5% revenue growth and 10% EPS growth than the numbers that Jeff outlined.

Speaker #4: We're excited about Ambient Sensing. Entry into some of the new TAMs—retail, e-commerce. We have a brand new CMO who brings a great deal of experience and talent to the table.

Speaker #4: And I see no reason why after our investments, we get back to our 5% revenue growth and 10% EPS growth than the numbers that Jeff outlined.

Speaker #3: Yeah. And I would add, Jim's comment about the very strong margins—we have a number of efficiency actions, some which are continuing from last year and some new ones—that will lower some costs that go with that revenue.

Jeff Likosar: Yeah. I would add Jim's comment about the very strong margins. We have a number of efficiency actions, some which are continuing from last year and some new ones that will lower some costs that goes with that revenue. And then that is largely offset by the cost of the investments that I mentioned. I mentioned around $50 million between technology in product IT and AI related, particularly some marketing investments, also the tariff headwind. On earnings per share, we will benefit a bit from net repurchases, offset somewhat by higher amortization, a little bit higher interest expense. We'd expect the tax approximately flat. Then I'll emphasize the cash, where we're expecting a very strong cash year, and that's a result of a bit less SAC investment.

Speaker #3: And then that is largely offset by the costs of the investments that I mentioned. I mentioned around $50 million between technology and product, IT and AI-related, particularly some marketing investments, and also the tariff headwind.

Speaker #3: On earnings per share, we will benefit a bit from net repurchases, offset somewhat by higher amortization and a little bit higher interest expense. We'd expect the tax.

Speaker #3: Approximately flat. And then I'll emphasize the cash, where we're expecting a very strong cash year. And that's a result of a bit less SAC investment.

Speaker #3: It's also the result of having entered the year in a strong position and being aware of some working capital opportunities during the year. And cash interest—we'd expect it to be lower in '26 than it was in 2025.

Jeff Likosar: It's also the result of having entered the year in a strong position and aware of some working capital opportunities during the year. Cash interest, we expect to be lower in 2026 than it was in 2025.

George Tong: Got it. That's very helpful. As a follow-up, you talked about initiatives you have in product technology, customer service, and acquisition efficiency to support your new medium-term financial framework. Can you elaborate on which of these initiatives you consider to be relatively new or a departure from your prior strategy?

Speaker #5: Got it. That's very helpful. And as a follow-up, you talked about initiatives you have in product technology, customer service, and acquisition efficiency to support your new medium-term financial framework.

Speaker #5: Can you elaborate on which of these initiatives you consider to be relatively new or a departure from your prior strategy?

Jim DeVries: I'd offer a couple, George. Obviously, the investments in ambient sensing are new for us with the acquisition of Origin. We see this new technology as a very significant change that we'll be integrating into our product going forward. It's unmatched in the industry and a differentiator for us. We continue to advance our investments and our capability in AI, and I'm excited about what I see on that front. Not only are we making advances in customer service, but now we're beginning to turn to sales, marketing, and growth and leveraging AI capability there. A third one is we will be leaning more assertively into DIY for customers who are more value-conscious.

Speaker #4: I'd offer a couple, George. Obviously, the investments in Ambient Sensing are new for us with the acquisition of Origin. We see this new technology as a very significant change that we'll be integrating into our product going forward.

Speaker #4: It's unmatched in the industry and a differentiator for us. We continue to advance our investments and our capability in AI. And I'm excited about what I see on that front, not only are we making advances in customer service, but now we're beginning to turn to sales marketing and growth and leveraging AI capability there.

Speaker #4: And then a third one is we will be leaning more assertively into DIY for customers who are more value conscious. And we'll be in retail and e-commerce in a way that we haven't been historically.

Jim DeVries: We'll be in retail and e-commerce in a way that we haven't been historically.

Speaker #3: And one thing I would add implicit in that, and Jim mentioned this in prepared remarks, is as we shift into some of those channels, generally, we expect those to be lower cost acquisition channels.

Omar Khan: One thing I would add implicit in that, and Jim mentioned this in prepared remarks, is as we shift into some of those channels, generally we expect those to be lower cost acquisition channels, and we will rationalize the amount of marketing and selling expense we spend in some of the higher cost acquisition channels, which is among the reasons why our revenue guide is as it is, some potential near-term disruption as we work through that transition.

Speaker #3: And we will rationalize the amount of marketing and selling expense we spend in some of the higher cost acquisition channels, which is among the reasons why our revenue guide is as it is.

Speaker #3: There's some potential near-term disruption as we work through that transition.

David Brown: Very helpful. Thank you.

George Tong: Very helpful. Thank you.

Speaker #5: Very helpful. Thank you.

Speaker #2: You are. Next question. Your next question comes from Alina. Peter Christiansen from Citi. Your line is open.

Operator: Your next question comes from the line of Peter Christensen from Citi. Your line is open.

Operator: Good morning. Thanks for the questions. nice free cash flow outlook, for sure. Jim, I wanna talk to you about, you know, some of these first steps you're making in AI first monitoring, obviously a huge potential trend. What's your vision on how this could evolve, I guess, over the next, I don't know, five or so years? Is there an opportunity here to really kinda change the calculus on ADT's kinda cost leverage?

Speaker #6: Good morning. Thanks for the question. Nice free cash flow outlook. For sure. Jim, I want to talk to you about some of these first steps you're making in AI-first monitoring obviously a huge potential trend.

Peter Christiansen: Good morning. Thanks for the questions. nice free cash flow outlook, for sure. Jim, I wanna talk to you about, you know, some of these first steps you're making in AI first monitoring, obviously a huge potential trend. What's your vision on how this could evolve, I guess, over the next, I don't know, five or so years? Is there an opportunity here to really kinda change the calculus on ADT's kinda cost leverage?

Speaker #6: What's your vision on how this could evolve, I guess, over the next five or so years? And is there an opportunity here to really kind of change the calculus on ADT's kind of cost leverage?

Speaker #4: Thanks for the question, Pete. I'll offer a couple of comments, and then Omar is with us today and he'll have a couple of comments as well.

Jim DeVries: Thanks for the question, Pete. I'll offer a couple of comments, and then Omar is with us today, and he'll have a couple comments as well. The short answer to your question, I think so. I think ADT is a company that's built for AI to be just incredibly transformational. We, as you know, have had a really heavy focus on customer service, scaling AI in both voice and chat. 100% of our chat interactions are already channeled through AI. Last year, about 20% of our calls were channeled through AI. Containment continues to improve. Then even more exciting than how we're leveraging AI in customer service, leveraging AI in sales and marketing is sort of the next frontier for us.

Speaker #4: The short answer to your question: I think so. I think ADT is a company that's built for AI to be just incredibly transformational. We, as you know, have had a really heavy focus on customer service, scaling AI in both voice and chat.

Speaker #4: I think something like 100% of our chat interactions are already channeled through AI. Last year, about 20% of our calls were channeled through AI. Containment continues to improve.

Speaker #4: And then even more exciting than how we're leveraging AI in customer service, leveraging AI in sales and marketing is sort of the next frontier for us.

Jim DeVries: We're partnered with Sierra, a fantastic partner. They're helping us expand into the e-commerce experience. We're doing two-way SMS to improve our lead contact rates. I think we mentioned in the script, we're next leveraging AI and transcription to analyze all our customer interactions, not just customer service, but including sales. I think the future is really exciting on leveraging AI for us.

Speaker #4: So we're partnered with Sierra, a fantastic partner. They're helping us expand into the e-commerce experience. We're doing two-way SMS to improve our lead contact rates.

Speaker #4: I think we mentioned in the script, we're next leveraging AI in transcription to analyze all our customer interactions, not just customer service, but including sales.

Speaker #4: And so I think the future is really exciting on leveraging AI for us.

Speaker #6: Thanks, Jim. And in addition to that, on the product and technology side, what Origin's AI Sensing platform gives us for the first time is the ability to insert an intelligence layer between the signals that get generated in the home and our monitoring and response and the consumer.

Omar Khan: Thanks, Jim. In addition to that, on the product and technology side, what Origin AI's AI sensing platform gives us for the first time is the ability to insert an intelligence layer between the signals that get generated in the home and our monitoring and response and the consumer. For the first time, we'll be able to take the signals, get some additional context from those signals. For instance, if there is a sensor activity in the home or a sensor signal in the home, our ability now will be to know whether or not whatever that motion is, how to classify it, whether it's a person, whether it's a pet, whether it's a mechanical vacuum cleaner.

Speaker #6: So for the first time, we'll be able to take the signals, get some additional context from those signals. So, for instance, if there is a sensor activity in the home or a sensor signal in the home, our ability now will be to know whether or not that, whatever that motion is, how to classify it—whether it's a person, whether it's a pet, whether it's a mechanical vacuum cleaner.

Speaker #6: In addition to that, we'll be able to help first responders in our monitoring centers to know where those intruders or people may be in the home in the event of an emergency.

Omar Khan: In addition to that, we'll be able to help first responders in our monitoring centers to know where those intruders or people may be in the home in the event of an emergency, and then whether or not they're still in the home when a first responder gets there. You can see that that intelligence layer is gonna give us a lot more context real-time about what's happening in the home and will absolutely positively impact the efficacy, and the efficiency of our monitoring and response and our first responder communications.

Speaker #6: And then whether or not they're still in the home when the first responder gets there. So you can see that that intelligence layer is going to give us a lot more context real-time about what's happening in the home.

Speaker #6: And we'll absolutely positively impact the efficacy and the efficiency of our monitoring and response and our first responder communications.

Operator: That's helpful. Omar, I guess just generally across the industry, how do you think about, you know, this acquisition Origin AI, strengthening ADT's competitive moat or perhaps just AI in general, creating, you know, more entrants, potentially big tech, that kind of thing? Just, I don't, I don't know how you frame that. I mean, we're in a different world these days. Just curious how you're thinking about the competitive setup.

Speaker #4: That's helpful. And Omar, I guess just generally, across the industry, how do you think about this acquisition, Origin AI, strengthening ADT's competitive moat or perhaps just AI in general?

Peter Christiansen: That's helpful. Omar, I guess just generally across the industry, how do you think about, you know, this acquisition Origin AI, strengthening ADT's competitive moat or perhaps just AI in general, creating, you know, more entrants, potentially big tech, that kind of thing? Just, I don't, I don't know how you frame that. I mean, we're in a different world these days. Just curious how you're thinking about the competitive setup.

Speaker #4: Creating more entrance potentially, big tech, that kind of thing. I don't know how you frame that. I mean, we're in a different world these days.

Speaker #4: Just curious how you're thinking about the competitive setup.

Omar Khan: Yeah. No, it's a, it's a great question, and I think it's a core reason why we bought Origin AI and the IP portfolio because, from a competitive set perspective, this gives us the ability to take off-the-shelf and traditional sensors and cameras, but augment it with additional signals that are privacy first and gives us the ability to both enhance the use cases in the security space by giving us more intelligence on what's happening in the home, how that and how first responders and monitoring can take advantage of those signals. Also, start to push us into ad-adjacent use cases like Jim talked about earlier on the call.

Speaker #5: Yeah, no, it's a great question. And I think it's a core reason why we bought Origin AI and the IP portfolio, because from a competitive set perspective, this gives us the ability to take off-the-shelf and traditional sensors and cameras, but augment it with additional signals that are privacy-first and give us the ability to both enhance the use cases in the security space by giving us more intelligence on what's happening in the home—and how first responders and monitoring can take advantage of those signals—but also start to push us into adjacent use cases like Jim talked about earlier on the call.

Speaker #5: The ability for us to know changes in gait, and changes in motion, gives us an incredible opportunity to lean into the aging-in-place opportunity and grow that side of our business as well.

Omar Khan: The ability for us to know changes in gait, and changes in motion gives us an incredible opportunity to lean into the aging in place opportunity, and grow that side of our business as well. It becomes both a differentiator for us as well as an ability for us to capture additional markets and RMR growth.

Speaker #5: So it becomes both a differentiator for us as well as an ability for us to capture additional markets in RMR growth.

Jeff Likosar: Just one thing I would add, I appreciate the way you framed the question. As we began our efforts in AI, it was at first focused on things that have hard cost reduction, you know, easy to measure cost reduction. We need to answer the phone fewer times, dispatch fewer trucks, also with improved service. Next category is customer outcomes, more means of preventing customers from canceling, proactively resolving customer needs.

Speaker #6: And Pete, just one thing I would add, and I appreciate the way I appreciate the way you framed the question, but as we begun our efforts or began our efforts in AI, it was at first focused on things that have hard cost reduction, easy-to-measure cost reduction.

Speaker #6: We need to answer the phone fewer times, dispatch fewer trucks, also with improved service. Next category is customer outcomes, more means of preventing customers from canceling proactively, resolving customer needs.

Speaker #6: But as I expect you can tell, the thing we're most excited about is this third category, which is better use cases for consumers—to keep them safer, to make them more protected in their homes, to open up new use cases, expand the TAM, as you see in the presentation deck.

Jeff Likosar: As I expect you can tell, the thing we're most excited about is this third category, which is better use cases for consumers to keep them safer, to make them more protected in their homes, to open up new use cases, expand the TAM, as you see in the presentation deck and you've already heard. That's exactly why we're making investments we're making during 2026.

Speaker #6: And you've already heard, but that's exactly why we're making investments. We're making them during 2026.

Operator: Absolutely. That's super helpful. Super interesting too. Thank you.

Speaker #4: Absolutely. That's super helpful. Super interesting, too. Thank you.

Peter Christiansen: Absolutely. That's super helpful. Super interesting too. Thank you.

Speaker #2: Thanks, Pete.

Jim DeVries: Thanks, Pete.

Operator: Your next question comes from the line of Manav Patnaik from Barclays. Your line is open.

Speaker #1: Your next question comes from a line of MNAV PetNec from Barclays. Your line is open.

Ronan Kennedy: Hi, good morning. This is Ronan Kennedy on from Manav. Thank you for taking our questions. Elements of this were asked and answered as part of George's question, but I would like to ask it another way, if I may, please. The framework shows 2026 as a transition year. I mean, want to confirm if that's how you would categorize it with revs and EPS flat, and then you have that return to 5% revenues and 10% EPS growth over the longer term. Is there a specific operating or market inflection point, whether it's the subscriber growth, attrition pricing, the new product that gives you confidence in what would appear to be a meaningful re-acceleration after 2026, rather than remaining in kind of range bound? Could you talk to those, please?

Speaker #7: Hi. Good morning. This is Ronan Kennedy. I'm from MNAV. Thank you for taking our questions. Elements of this were asked and answered as part of George's question.

Speaker #7: George's question, but I would like to ask it another way if I may, please. The framework—it shows '26 as a transition year. I mean, I want to confirm if that's how you would categorize it.

Speaker #7: With revs and EPS flat, and then you have that return to 5% revenues and 10% EPS growth over the longer term. Is there a specific operating or market inflection point, whether it's the subscriber growth, attrition pricing, the new product, that gives you confidence in what would appear to be a meaningful re-acceleration after 26?

Speaker #7: Rather than remaining in kind of range-bound, could you talk to those? Please.

Speaker #5: Yeah, sure, Ronan. I'll make a couple of comments, and then Jeff will add his perspective. First, just from a grounding perspective, we've been, I think our 2021.

Jim DeVries: Yeah, sure, Ronan. I'll make a couple comments and then Jeff will add his perspective. First, just from a grounding perspective, I think our 2021 CAGR for revenue growth was 5%. You know, getting back to 5%, to me, I see no reason why we don't get back to 5%. On the EPS front, I think the long-term objective we had was 10%. I think that is very doable, especially with substantial buyback and 10% free cash flow. Our 5-year CAGR on cash is 21%. I don't think it's a significant trajectory change to get back to where we've been for the last five years.

Speaker #5: 5K for revenue growth was 5%. And getting back to 5% to me, I see no reason why we don't get back to 5%. On the EPS front, I think the long-term objective we had was 10%.

Speaker #5: I think that is very doable, especially with substantial buyback. And 10% free cash flow—our five-year CAGR on cash is 21%. And so I don't think it's a significant trajectory change to get back to where we've been for the last five years.

Jim DeVries: That said, some of the things that give me confidence that these investments will be substantially positive for us, we're continuing to expand ADT+, our proprietary platform, and having good success on that front. AI is probably a touch more advanced than I anticipated it to be, and I love the opportunities that we see with AI in sales and marketing. Origin, as Omar just pointed out, that's a fantastic acquisition, and the new technology will help us both from a use case perspective and from a differentiation perspective.

Speaker #5: That said, some of the things that give me confidence that these investments will be substantially positive for us were continuing to expand ADT Plus, our proprietary platform, and having good success on that front.

Speaker #5: AI is probably a touch more advanced than I anticipated it to be, and I love the opportunities that we see with AI in sales and marketing.

Speaker #5: Origin is Omar just pointed out, that's a fantastic acquisition. And the new technology will help us both from a use case perspective and from a differentiation perspective.

Speaker #5: And I don't think Omar or Jeff mentioned this, but Verisure, the largest security player in Latin America and Europe, already, through licensing agreements, deploys some of the use cases that we're talking about with Wi-Fi sensing.

Jim DeVries: I don't think Omar or Jeff Likosar mentioned this, but Verisure, the largest security player in Latin America and Europe, already through licensing agreements deploys some of the use cases that we're talking about with Wi-Fi sensing, in actually in hundreds of thousands of homes. This isn't terribly far out. The last thing I'd mention, Ronan Kennedy, we will have a pretty substantial DIY investment in 2020, 2026. It'll be meaningfully EBIT and negative during the year. I like what we're seeing. We have a new leader over DIY. Year to date, we're up almost 23%, and that's prior to the new product being available in Q3, in Q2, and prior to being in retail and e-commerce in a meaningful way.

Speaker #5: And actually, in hundreds of thousands of homes. So this isn't terribly far out. And then the last thing I'd mention, Ronan, we will have a pretty substantial DIY investment in 2026.

Speaker #5: It'll be meaningfully EBITDA negative during the year, but I like what we're seeing. We have a new leader over DIY. Year to date, we're up almost 23%.

Speaker #5: And that's prior to the new product being available in Q3 in Q2 and prior to being in retail and e-commerce in a meaningful way.

Jim DeVries: I think as those investments take shape, I feel really confident about the future.

Speaker #5: So I think as those investments take shape, I feel really confident about the future.

Jim DeVries: I think as those investments take shape, I feel really confident about the future.

Speaker #6: Yeah. And I would add a couple of points. One is that implicit in your question is how we deploy capital. And we have, for the past few years, been focused, as we described, on cash generation, having more than doubled our adjusted free cash flow between 2021 and 2025.

Jeff Likosar: Yeah, I would add a couple points. One is that implicit in your question is how we deploy capital. We have for the past few years been focused, as we described, on cash generation, having more than doubled our adjusted free cash flow between 2021 and 2025. The last couple years especially, but also over the last five years, we've returned significant capital to shareholders, $1.6 billion. We are announcing today a $1.5 billion share repurchase program. That is because we believe the stock is very attractively priced and doesn't reflect what we believe is the intrinsic value of the business.

Speaker #6: The last couple of years, especially, but also over the last five years, we've returned significant capital to shareholders, $1.6 billion. We are announcing today a $1.5 billion share repurchase program.

Speaker #6: That is because we believe the stock is very attractively priced and doesn't reflect what we believe is intrinsic value of the business. So as this technology rolls out, as we begin to commercialize it, as we execute the other things that Jim mentioned and as we undertake some of the actions to make our go-to-market more efficient, we would anticipate some combination of deploying more capital towards ads and/or enjoying more ads for the same amount of capital.

Jeff Likosar: As this technology rolls out as we begin to commercialize it, as we execute the other things that Jim mentioned, and as we undertake some of the actions to make our go-to-market more efficient, we would anticipate some combination of deploying more capital towards ads and/or enjoying more ads for the same amount of capital. That also becomes the inflection point is just the allocation of more capital towards ads that will go along with the completion of the things that Jim described.

Speaker #6: So that also becomes the inflection point is just the allocation of more capital towards ads that will go along with the completion of the things that Jim described.

Speaker #7: Thank you both very much for that. And as a follow-up in this multi-year framework, can you quantify or qualitatively characterize that targeted 5% revenue growth into major drivers, whether that's net subs growth, your installation activity, your RMR, adjacent TAM, the new entry, pricing, or even the M&A?

Ronan Kennedy: Thank you both very much for that. As a follow-up, in this multi-year framework, can you quantify or qualitatively characterize that target of 5% revenue growth into major drivers, whether that's net subs growth, your installation activity, your RMR, adjacent TAM, the new entry pricing, or even the M&A? How should we think about the major contributors to that targeted 5% growth?

Speaker #7: How should we think about the major contributors to that targeted 5% growth?

Speaker #5: Yeah. The main contributor will be RMR just because RMR is our largest base of revenue. We noted an objective of a million more subscribers; it's maybe worth mentioning that some of those subscribers might be more value-conscious or more price-centric.

Jeff Likosar: Yeah. The main contributor will be RMR, just because RMR is our largest base of revenue. We noted an objective of 1 million more subscribers. It's maybe worth mentioning that some of those subscribers might be more value conscious or more price centric, so those subscribers could be lower revenue per unit. The crux of it will be more subs and/or RMR in with the precise combination dependent to a certain extent on how well each does work. Maybe worth noting that we have internal plans and objectives that are in excess to that.

Speaker #5: So those subscribers could be lower revenue per unit. But the crux of it will be more subs and/or RMR with the precise combination dependent to a certain extent on the how well each has worked.

Speaker #5: Maybe worth noting that we have internal plans and objectives that are in excess of that. And then we anticipate continuing to command within any particular segment of customers or cohort of customers a pricing premium because of the fact that we deliver the best service to the best protection, the best monitoring capabilities of anybody else in our space.

Jeff Likosar: We anticipate continuing to command within any particular segment of customers or cohort of customers, a pricing premium because of the fact that we deliver the best service, the best protection, the best monitoring capabilities of anybody else in our space.

Speaker #7: Thank you, Jeff. Appreciate it.

Ronan Kennedy: Thank you, Jeff. Appreciate it.

Operator: Your next question comes from the line of Ashish Sabadra from RBC Capital Markets. Your line is open.

Speaker #1: Your next question comes from a line of Ashish Sabadra from RBC Capital Markets. Your line is open.

Ashish Sabadra: Thank you for the question. I just wanted to follow up on the change in the customer acquisition strategy. Jeff, I believe you mentioned, there was the success in the DIY year to date, which is, I believe is up 23%. If you could just elaborate on that one, the kind of success that you're seeing and how does these new product launches in Q2 or Q3 will be further tailwind for that strategy going forward. Maybe if I can just ask another question on the same topic would be just that focus on the e-com channel. How might the shift from LLM adoption impact e-com customer acquisition over the midterm? Thanks.

Speaker #8: Making my question. I just wanted to follow up on the change in the customer acquisition strategy. Jeff, I believe you mentioned there was the success in the DIY year to date, which is, I believe, is up 23%.

Speaker #8: So if you could just elaborate on that one, the kind of success that you're seeing and how does these new product launches in Q2 or Q3 will be further tailwind for that strategy going forward?

Speaker #8: And maybe if I can just ask another question on the same topic would be just that focus on the e-com channel. How might the shift from LLM adoption impact e-com customer acquisition over the midterm?

Speaker #8: Thanks.

Speaker #5: Thanks, Ashish. Jeff and I will tag team this one as well. So on DIY, we have not historically leaned in in a particularly assertive way in DIY.

Jim DeVries: Thanks, Ashish. Jeff and I will tag team this one as well. On DIY, we have not historically leaned in a particularly assertive way in DIY. There's a handful of reasons why, but over the course of the last 6 months or so, we have been paying more attention to this segment. One of the things, a lens I'll say, that we contemplate DIY through is having a relationship with the customer when the customer is younger and has less sophisticated security needs. As their security needs develop, converting them to a DIFM customer. From a customer lifetime value perspective, we need about, you know, 7, 8, maybe 9 or 10 DIY customers to create the same value as a DIFM customer.

Speaker #5: There's a handful of reasons why. But over the course of the last six months or so, we have been paying more attention to this segment.

Speaker #5: One of the things, a lens, I'll say, that we contemplate DIY through is having a relationship with the customer when the customer is younger and has less sophisticated security needs, and then as their security needs develop, converting them to a DIFM customer.

Speaker #5: From a customer lifetime value perspective, we need about 7, 8, maybe 9, or 10 DIY customers to create the same value as a DIFM customer.

Speaker #5: And so although we're excited about the growth, the key strategic challenge for us is to get really good at conversion. And this year, we've been paying a lot more attention to phishing in the pond of value-conscious customers.

Jim DeVries: Although we're excited about the growth, the key strategic challenge for us is to get really good at conversion. This year we've been paying a lot more attention to fishing in the pond of value-conscious customers. DIY, while it has a small denominator, is up just under 23%. Later this year, as we roll out a new product lineup, and begin to advertise more aggressively in this space and develop our e-commerce capabilities, we feel pretty good about this new segment.

Speaker #5: DIY, while it has a small denominator, is up just under 23%. And later this year, as we roll out a new product lineup and begin to advertise more aggressively in this space and develop our e-commerce capabilities.

Speaker #5: We feel pretty good about this new segment.

Jeff Likosar: Yeah. I would add generally, we're always fine-tuning our customer acquisition strategy, but part of what we're doing in 2026 is a bit more than fine-tuning. Just for context, we acquire customers via phone sales, field sales. We mentioned that we have, during 2025, migrated to what we call a tech engineer model, which is something of a hybrid of both a salesperson or a person who configures the customer system and installs it. We have our dealer channel, we have bulk, we have e-commerce and moving to e-com and retail. They all have different characteristics with respect to the cost of the sale and the commissions. Same on marketing. We spend marketing dollars on upper funnel, brand advertising, affiliate partnerships, and social.

Speaker #7: Yeah, and I would add more generally, we're always fine-tuning our customer acquisition strategy, but part of what we're doing in '26 is a bit more than fine-tuning. And just for context, we acquire customers via phone sales, field sales.

Speaker #7: We mentioned that we have during ’25 migrated to what we call a tech engineer model, which is something of a hybrid of both a salesperson or a person who configures the customer system and installs it.

Speaker #7: We have our dealer channel. We have bulk. We have e-commerce. And you're moving to e-com and retail. They all have different characteristics with respect to the cost of the sale and the commissions.

Speaker #7: And then same on marketing. We spend marketing dollars on upper funnel, brand advertising, affiliate partnerships. Social, some of our marketing is with partners. So what we're doing this year more assertively is reducing the kinds of ads where we spend the most combined between the marketing cost and the commission cost.

Jeff Likosar: Some of our marketing is with partners. What we're doing this year more assertively is reducing the kinds of ads where we spend the most combined between the marketing cost and the commission cost. We think we have an opportunity to become more efficient. Potentially, as already mentioned, with some near-term disruption, which is part of the reason that we're not counting on as many new subscriber additions during 2026 as we otherwise would. We think beyond that, we will have reset the cost of sales and marketing and go-to-market costs more generally.

Speaker #7: And I think we have an opportunity to become more efficient potentially as already mentioned with some near-term disruption, which is part of the reason that we're not counting on as many new subscriber additions during 2026 as we otherwise would.

Speaker #7: But we think, beyond that, we will have reset the cost of sales and marketing, and go-to-market cost more generally.

David Brown: That's very helpful color. Maybe just as a follow-up, how should we think about the EBITDA growth in 2026? Should it be more in line with the revenue and EPS growth? Any color there would be helpful. Thanks.

Speaker #5: That's very helpful, color. And maybe just as a follow-up, how should you think about the EBITDA growth in 2026? Should it be more in line with the revenue and EPS growth?

Ashish Sabadra: That's very helpful color. Maybe just as a follow-up, how should we think about the EBITDA growth in 2026? Should it be more in line with the revenue and EPS growth? Any color there would be helpful. Thanks.

Speaker #5: Any color there will be helpful.

Speaker #3: Yeah, yeah. We're focusing on earnings per share. Many of the drivers, as you know, are similar. Earnings per share, of course, benefits from share repurchases.

Jeff Likosar: Yeah, yeah. We're focusing on earnings per share. Many of the drivers, as you know, are similar. Earnings per share, of course, benefits from share repurchases. It also has the amortization, interest, as I mentioned earlier. The overall operational dynamics are the same. One of the reasons that we're emphasizing earnings per share more is because some of the things I just described in terms of the way we acquire customers will have or may have different accounting manifestations. As you know, there's a meaningful portion of our subscriber acquisition spending that we capitalize. If we acquire a customer through one channel, we would capitalize the marketing cost. If we instead were to spend more money, just as a for example, on upper funnel advertising, we would expense all of the related advertising costs.

Speaker #3: It also has the amortization, interest, as I mentioned earlier. But the overall operational dynamics are the same. One of the reasons that we're emphasizing earnings per share more is because some of the things I just described, in terms of the way we acquire customers, will have or may have different accounting manifestations.

Speaker #3: As you know, there's a meaningful portion of our subscriber acquisition spending that we capitalize if we acquire customer through one channel. We would capitalize the marketing cost if we instead were to spend more money just as a, for example, on upper funnel advertising.

Speaker #3: We would expense all of the related advertising costs. That effect is less pronounced in EPS over time than it is in EBITDA. But aside from that—the accounting manifestation—the operational drivers are the same.

Jeff Likosar: That effect is less pronounced in EPS over time than it is in EBITDA. Aside from that, the accounting manifestation, the operational drivers are the same.

Speaker #5: Thank you. Thanks, Jeff. Thank you.

David Brown: Thank you. Thanks, Jeff. Thank you.

Ashish Sabadra: Thank you. Thanks, Jeff. Thank you.

Operator: Your next question comes from a line of Gregory Parrish from Morgan Stanley. Your line is open.

Speaker #1: Your next question comes from a line of Greg Parrish ish from Morgan Stanley. Your line is open.

Gregory Parrish: Hey, guys. Good morning. Thanks for taking my question. I just wanted to ask a high-level question about technology acquisition. You decided to buy this, you know, AI sensing technology. I think you spoke on the call about potentially more technology M&A in the future. Maybe just from a high level, you know, why do you think it's advantageous for you to own rather than license some of this technology as it pertained to Origin AI, and then maybe as well for the potential, future investments too? Thanks.

Speaker #8: Hey guys, good morning. Thanks for taking my question. I just wanted to ask a high-level question about technology acquisition. You decided to buy this AI sensing technology.

Speaker #8: I think you spoke on the call about potentially more technology M&A in the future. So maybe just from a high level, why do you think it's advantageous for you to own rather than license some of this technology?

Speaker #8: As it pertains to Origin AI and then maybe as well for the potential future investments too. Thanks.

Speaker #3: Yeah. Real quick, I mentioned on the call that in the coming years, we would anticipate potentially more on M&A than in recent years. Part of that is because we have not spent that much capital on M&A.

Jeff Likosar: Yeah. Real quick. I mentioned on the call that in the coming years, we would anticipate potentially more on M&A than in recent years. Part of that is because we have not spent that much capital on M&A, the attractiveness of share repurchases being one of the reasons. We're always looking at the landscape, and as you know, sometimes there's good assets available, sometimes not. Sometimes we pursue one and end up walking away from it. I wouldn't read too much into it other than that we will continue to evaluate. The two broad categories would be technology related is one category. Another category would be expansion of footprint, more subscribers, kind of bulk-like M&A.

Speaker #3: The attractiveness of share repurchases being one of the reasons. And then we're always looking at the landscape and, as you know, sometimes there's good assets available, sometimes not.

Speaker #3: Sometimes we pursue one and end up walking away from it. So I wouldn’t read too much into it, other than that we would continue to evaluate, and then the two broad categories would be technology-related.

Speaker #3: Is one category, another category would be expansion of footprint, more subscribers, kind of bulk-like M&A. But I'll pass to Omar on the more specific question as to the advantages of owning.

Jeff Likosar: I'll pass to Omar on the more specific question as to the advantages of owning.

Speaker #8: Thanks, Jeff. I mean, we're always undergoing analysis around buy versus build, license versus acquire. And there are certain situations where it'll make sense for Origin AI specifically.

Omar Khan: Thanks, Jeff. You know, I mean, we're always undergoing analysis around buy versus build, license versus acquire, and there are certain situations where it'll make sense. For Origin AI, specifically, the reason it made sense to acquire was multiple fold. One was we're integrating this across our entire proprietary ADT Plus platform. It's not something where we're licensing a specific use case or a small engine. We're actually integrating Origin's intelligence layer across our entire product portfolio. It'll impact pretty much every use case that we have in the company. From a foundational perspective, it's incredibly important for us to own not just the technology, but own its trajectory over time, so we can continue to control it. It's one of the main reasons we innovated and brought ADT Plus to market.

Speaker #8: The reason it made sense to acquire was multiple fold. One was we're integrating this across our entire proprietary ADT Plus platform. So it's not something where we're licensing a specific use case or a small engine.

Speaker #8: We're actually integrating Origin's intelligence layer across our entire product portfolio. It'll impact pretty much every use case that we have in the company. So from a foundational perspective, it's incredibly important for us to own not just the technology, but own its trajectory over time so we can continue to control it.

Speaker #8: It's one of the main reasons we innovated and brought ADT Plus to market. The second area is that we did a fairly thorough IP analysis.

Omar Khan: The second area is that we did a fairly thorough IP analysis, and Origin's IP is both seminal and foundational, and it's incredibly exciting for us to continue leveraging the 50-plus professionals that are at Origin AI to continue propagating and developing new IP in the space. It's not just a point-in-time acquisition. We also bought an engine that will continue to produce next-generation intellectual property for us to leverage going forward.

Speaker #8: And Origin's IP is both seminal and foundational. And it's incredibly exciting for us to continue leveraging the 50-plus professionals that are at Origin AI to continue propagating and developing new IP in the space.

Speaker #8: So it's not just a point-in-time acquisition. We're also buying—we also bought—an engine that will continue to produce next-generation intellectual property for us to leverage going forward.

Speaker #8: Okay, great. That's very helpful color. And then, maybe just Omar, since you're on the call here and we're talking about potential technology M&A, I guess, what capabilities or technologies are out there that maybe could bolster the platform over time?

Gregory Parrish: Okay, great. That's, that's very helpful color. Maybe just, Omar, since you're on the call here, and we're talking about potential technology M&A, I guess, what capabilities or technologies are out there that, you know, maybe could bolster the platform over time? Are there sort of capabilities that you think that would sort of fit good in the portfolio that maybe the offering doesn't have today that, you know, you can see adding in the next couple of years?

Speaker #8: Are there sort of capabilities that you think that would sort of fit good in the portfolio that maybe the offering doesn't have today that you can see adding in the next couple of years?

Speaker #3: Yeah, I mean, I think for us, as we look at it, there are use cases that we see opportunities for us to grow in.

Omar Khan: Yeah. I mean, I think for us, as we look at it, there's use cases that we see opportunities for us to grow in. Obviously, continue to expand the core business security use case. In those areas, generally, we're looking at licensing or sourcing technologies. There's an area of adjacent use cases like Aging Place and additional types of health monitoring. In those spaces, we'll continue to look at leading-edge technology where IP or technology or product acquisition could become a differentiator for us. We're doing a lot of other work in the AI space, specifically related to sensor fusion and bringing those signals together to provide insights to our customers and to our monitoring centers.

Speaker #3: Obviously, continue to expand the core business security use case. And in those areas, generally, we're looking at licensing or sourcing technologies. There's an area of the adjacent use cases like aging in place and additional types of health monitoring.

Speaker #3: In those spaces, we'll continue to look at leading-edge technology where IP or technology or product acquisition could become a differentiator for us. But we're doing a lot of other work in the AI space specifically related to sensor fusion and bringing those signals together to provide insights to our customers and to our monitoring centers.

Omar Khan: Right now, our focus is really taking advantage of the Origin AI acquisition, making that operational over the next 12 to 18 months, and integrating it into our portfolio and launching additional services and capabilities to grow our subscriber base and our RMR.

Speaker #3: But right now, our focus is really taking advantage of the Origin AI acquisition, making that operational over the next 12 to 18 months in an integrating it into our portfolio and launching additional services and capabilities to grow our subscriber base and our RMR.

Speaker #8: Okay. Thanks very much.

Gregory Parrish: Okay. Thanks very much.

Speaker #1: And we have reached the end of our question and answers.

Operator: We've reached the end of our question and answer.

Jeff Likosar: No, sorry. I was just gonna emphasize, again, you know, balanced capital allocation. You know, we don't want to come across as dramatic shift, but we do anticipate more M&As because we haven't spent as much, and we just did one that was a relatively sizable outflow the first part of this year. I'll remind of the $1.5 billion share repurchase authorization, which we think is a very attractive use of capital.

Speaker #3: No, sorry. I was just going to emphasize again, bounce capital allocation. We don't want to come across as dramatic shift, but we do anticipate more M&A just because we haven't spent as much and we just did one that was a relatively sizable outflow the first part of this year.

Speaker #3: But I'll remind you of the $1.5 billion share repurchase authorization, which we think is a very attractive use of capital.

Speaker #1: And we've reached the end of our question and answer session. I will now turn the call back over to Jim Devries for closing remarks.

Operator: We've reached the end of our question and answer session. I will now turn the call back over to Jim DeVries for closing remarks.

Speaker #9: Thank you, Rob. And thanks, everyone, for taking the time to join us today. We're confident in our plans for 2026. Key goals for our team will be to develop our investments in new product technology.

Jeff Likosar: Thank you, Rob, thanks everyone for taking the time to join us today. We're confident in our plans for 2026. Key goals for our team will be to develop our investments in new in-product technology, and to meet our commitments for gross adds and retention. I'd like to extend my appreciation to our ADT employees, our dealer partners. Congratulations on a good Q4 and a strong 2025. Thanks again for joining, everybody, have a great day.

Jim DeVries: Thank you, Rob, thanks everyone for taking the time to join us today. We're confident in our plans for 2026. Key goals for our team will be to develop our investments in new in-product technology, and to meet our commitments for gross adds and retention. I'd like to extend my appreciation to our ADT employees, our dealer partners. Congratulations on a good Q4 and a strong 2025. Thanks again for joining, everybody, have a great day.

Speaker #9: And to meet our commitments for gross ads and retention, I'd like to extend my appreciation to our ADT employees, our dealer partners, congratulations on a good fourth quarter and a strong 2025.

Speaker #9: Thanks again for joining, everybody, and have a great day.

Operator: This concludes today's conference call. Thank you for your participation. You may now disconnect.

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