ADT Stock Hits 52-Week Low - Here's Why

ADT Inc. (NYSE:ADT) stock plunged on Monday after the home security giant delivered mixed fourth-quarter results and issued a lackluster 2026 outlook that fell short of Wall Street expectations.

While annual revenue and adjusted earnings improved, softer-than-expected guidance and revenue miss overshadowed the modest earnings beat, sending the stock to a new 52-week low.

Total revenue increased 1% year over year to $1.276 billion in the fourth quarter and climbed 5% to $5.129 billion for the full year. Adjusted earnings of 23 cents per share topped the 22-cent estimate, while quarterly revenue fell short of expectations of $1.296 billion.

GAAP income from continuing operations was $146 million, or 17 cents per diluted share, in the fourth quarter, down from $197 million, or 21 cents per diluted share, a year earlier.

Segment Performance

Monitoring and related services revenue was $1.083 billion in the fourth quarter and $4.354 billion for the full year. Security installation, product, and other revenue were $193 million in the quarter and $775 million for the year.

Monitoring revenue growth was driven by higher average prices, partially offset by lower volume, while installation revenue increased primarily due to a higher mix of professionally installed systems under the outright sales model.

End-of-period recurring monthly revenue was $359 million, gross customer revenue attrition was 13.1%, and trailing twelve-month revenue payback was 2.3 years.

ADT said its Remote Assistance program handled approximately 50% of service requests virtually and that it delivered an industry-leading average alarm acknowledgment time of less than 10 seconds.

Cash Flow and Balance Sheet

Operating cash flow was $374 million in the fourth quarter and $1.884 billion for the year. Adjusted free cash flow (including interest rate swaps) was $154 million in the quarter and $863 million for the year.

Cash and cash equivalents totaled $81 million at December 31, 2025, and long-term debt was $7.379 billion. Net debt was $7.323 billion, and the net leverage ratio was 2.7x.

Capital Allocation

ADT returned $791 million to shareholders in 2025, including $604 million of share repurchases that retired 78 million shares and $187 million in dividends.

The board authorized a share repurchase plan of up to $1.5 billion through April 30, 2029, and declared a quarterly dividend of 5.5 cents per share payable April 2, 2026.

“ADT again delivered solid financial performance in 2025, generating robust cash flow and further strengthening our financial foundation. As we enter 2026, we are positioning ADT to lead the next era of smart home intelligence with our ADT+ platform and new ambient sensing capabilities,” stated ADT Chairman, President, and CEO Jim DeVries.

Outlook

For 2026, the company said it expects adjusted free cash flow (including interest rate swaps) to grow approximately 20% year over year, with revenue and adjusted EPS approximately flat, and noted that the outlook includes headwinds from tariffs.

ADT sees full-year adjusted EPS of 89 cents, below the 95-cent estimate, and sales of $5.129 billion, below the $5.332 billion estimate.

ADT Price Action: ADT shares were down 10.79% at $7.15 at the time of publication on Monday. The stock is trading at a new 52-week low.

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