Global Finance News
11 Nov 2026, 09:13
Resideo Falls 3.3% After Hours as GAAP Profit Drops Despite Margin Expansion
Resideo Technologies (NYSE: REZI) shares fell about 3.3% in after-hours trading after the company reported modest revenue growth and higher adjusted EBITDA but a sharp decline in GAAP earnings following its ADI separation.
Third-quarter revenue increased 3% year over year to $727 million. Excluding OEM Security, revenue rose 6% to $694 million, supported by volume growth and pricing across sales channels and product categories. OEM Security revenue fell 34% to $33 million as volumes from a major customer declined.
Gross margin improved to 40.4%, marking the 14th consecutive quarter of year-over-year expansion. Standalone adjusted EBITDA increased 5% to $154 million, while adjusted diluted EPS rose 8% to $0.52.
GAAP results were much weaker. Income from continuing operations fell 66% to $31 million, while diluted EPS declined 71% to $0.14. The quarter included $30 million of non-recurring separation expenses tied to the ADI spin-off as well as higher restructuring and debt-extinguishment costs.
Resideo also used a $900 million dividend from ADI and $200 million of cash to repay $1.1 billion of debt, reducing gross debt to $2.1 billion at quarter-end.
For 2026, the company expects revenue of $2.927-$2.947 billion, standalone adjusted EBITDA of $614-$624 million and adjusted EPS of $1.92-$1.98. Fourth-quarter revenue is expected at $710-$730 million.
The 3.3% after-hours decline appears to reflect investor concern over the steep drop in GAAP profitability and continued softness in OEM Security, despite improving margins, higher adjusted earnings and meaningful debt reduction.
Resideo Technologies (NYSE: REZI) shares fell about 3.3% in after-hours trading after the company reported modest revenue growth and higher adjusted EBITDA but a sharp decline in GAAP earnings following its ADI separation.
Third-quarter revenue increased 3% year over year to $727 million. Excluding OEM Security, revenue rose 6% to $694 million, supported by volume growth and pricing across sales channels and product categories. OEM Security revenue fell 34% to $33 million as volumes from a major customer declined.
Gross margin improved to 40.4%, marking the 14th consecutive quarter of year-over-year expansion. Standalone adjusted EBITDA increased 5% to $154 million, while adjusted diluted EPS rose 8% to $0.52.
GAAP results were much weaker. Income from continuing operations fell 66% to $31 million, while diluted EPS declined 71% to $0.14. The quarter included $30 million of non-recurring separation expenses tied to the ADI spin-off as well as higher restructuring and debt-extinguishment costs.
Resideo also used a $900 million dividend from ADI and $200 million of cash to repay $1.1 billion of debt, reducing gross debt to $2.1 billion at quarter-end.
For 2026, the company expects revenue of $2.927-$2.947 billion, standalone adjusted EBITDA of $614-$624 million and adjusted EPS of $1.92-$1.98. Fourth-quarter revenue is expected at $710-$730 million.
The 3.3% after-hours decline appears to reflect investor concern over the steep drop in GAAP profitability and continued softness in OEM Security, despite improving margins, higher adjusted earnings and meaningful debt reduction.
