Revenue grew 9.2% year-over-year to $277.7M in Q2 2026 with gross margin stable at 65.6%, while operating income rose 1.6% to $32.5M, indicating emerging operating leverage.
Alarm.com Holdings, Inc. (ALRM) annual income statement — 14-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 |
|---|
| Sales/Revenue | 1.06B | 1.01B | 939.83M | 881.68M | 842.56M | 748.97M | 618M | 502.36M | 420.49M | 338.94M | 261.11M | 208.89M | 167.31M | 130.22M | 96.47M |
| Revenue Growth % | 8.72% | 7.59% | 6.59% | 4.64% | 12.5% | 21.19% | 23.02% | 19.47% | 24.06% | 29.81% | 25% | 24.85% | 28.48% | 34.98% | - |
| Cost of Goods Sold | 388.12M | 373.11M | 326.15M | 325.16M | 342.58M | 305.9M | 227.43M | 183.6M | 145.72M | 116.19M | 99.38M | 77.37M | 67.18M | 54.96M | 41.45M |
| COGS % of Revenue | - | 36.9% | 34.7% | 36.88% | 40.66% | 40.84% | 36.8% | 36.55% | 34.65% | 34.28% | 38.06% | 37.04% | 40.15% | 42.2% | 42.97% |
| Gross Profit | 672.87M | 638.07M | 613.68M | 556.52M | 499.98M | 443.07M | 390.57M | 318.76M | 274.78M | 222.75M | 161.73M | 131.51M | 100.13M | 75.26M | 55.02M |
| Gross Margin % | 63.42% | 63.1% | 65.3% | 63.12% | 59.34% | 59.16% | 63.2% | 63.45% | 65.35% | 65.72% | 61.94% | 62.96% | 59.85% | 57.8% | 57.03% |
| Gross Profit Growth % | - | 3.98% | 10.27% | 11.31% | 12.84% | 13.44% | 22.53% | 16.01% | 23.36% | 37.73% | 22.97% | 31.34% | 33.04% | 36.79% | - |
| Operating Expenses | 534.87M | 504.44M | 505.13M | 489.69M | 448.94M | 381.5M | 334.28M | 268.35M | 262.58M | 189.38M | 147.67M | 113.52M | 79.62M | 67.78M | 38.5M |
| OpEx % of Revenue | - | 49.89% | 53.75% | 55.54% | 53.28% | 50.94% | 54.09% | 53.42% | 62.44% | 55.87% | 56.55% | 54.35% | 47.59% | 52.05% | 39.91% |
| Selling, General & Admin | 251.89M | 234.21M | 220.12M | 213.16M | 199.44M | 174.07M | 154.61M | 131.77M | 151.65M | 98.89M | 96.91M | 67.71M | 51.95M | 51.4M | 27.33M |
| SG&A % of Revenue | - | 23.16% | 23.42% | 24.18% | 23.67% | 23.24% | 25.02% | 26.23% | 36.07% | 29.18% | 37.11% | 32.42% | 31.05% | 39.47% | 28.33% |
| Research & Development | 275.86M | 270.23M | 255.88M | 245.11M | 218.63M | 177.71M | 152.15M | 114.44M | 89.2M | 72.75M | 44.27M | 40M | 23.19M | 13.09M | 8.94M |
| R&D % of Revenue | - | 26.72% | 27.23% | 27.8% | 25.95% | 23.73% | 24.62% | 22.78% | 21.21% | 21.47% | 16.96% | 19.15% | 13.86% | 10.05% | 9.27% |
| Other Operating Expenses | 0 | 0 | 29.13M | 31.42M | 30.87M | 29.71M | 27.52M | 22.13M | 0 | 0 | 0 | 0 | 3.99M | 3.36M | 2.23M |
| Operating Income | 138M | 135.83M | 108.55M | 66.83M | 51.04M | 61.57M | 56.3M | 50.41M | 12.2M | 33.37M | 14.06M | 17.99M | 21M | 7.42M | 16.52M |
| Operating Margin % | 13.01% | 13.43% | 11.55% | 7.58% | 6.06% | 8.22% | 9.11% | 10.04% | 2.9% | 9.85% | 5.38% | 8.61% | 12.55% | 5.7% | 17.12% |
| Operating Income Growth % | - | 25.13% | 62.43% | 30.94% | -17.11% | 9.37% | 11.67% | 313.15% | -63.44% | 137.4% | -21.86% | -14.33% | 182.87% | -55.05% | - |
| EBITDA | 179.22M | 182.03M | 151.61M | 110.95M | 93.77M | 102.22M | 84.7M | 80.85M | 34.82M | 52.07M | 21.33M | 24.19M | 25.19M | 10.98M | 18.95M |
| EBITDA Margin % | 16.89% | 18% | 16.13% | 12.58% | 11.13% | 13.65% | 13.71% | 16.09% | 8.28% | 15.36% | 8.17% | 11.58% | 15.06% | 8.44% | 19.64% |
| EBITDA Growth % | 4.97% | 20.06% | 36.65% | 18.33% | -8.27% | 20.68% | 4.77% | 132.17% | -33.13% | 144.08% | -11.81% | -3.98% | 129.33% | -42.03% | - |
| D&A (Non-Cash Add-back) | 41.23M | 46.2M | 43.06M | 44.12M | 42.73M | 40.65M | 28.4M | 30.43M | 22.62M | 18.7M | 7.28M | 6.2M | 4.19M | 3.56M | 2.43M |
| EBIT | 170.76M | 186.54M | 153.23M | 101.25M | 59.74M | 62.02M | 82.76M | 61.87M | 14.62M | 34.44M | 14.57M | 17.64M | 20.52M | 7.48M | 16.52M |
| Net Interest Income | 14.99M | 28.32M | 35.93M | 26.37M | 5.62M | -15.37M | -1.73M | 1.95M | -646K | -1.17M | -190K | -178K | -196K | -269K | -312K |
| Interest Income | 30.86M | 45.62M | 47.36M | 29.8M | 8.76M | 587K | 870K | 4.92M | 2.27M | 1.03M | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 15.87M | 17.29M | 11.43M | 3.43M | 3.14M | 15.96M | 2.6M | 2.97M | 2.92M | 2.2M | 190K | 178K | 196K | 269K | 312K |
| Other Income/Expense | 16.89M | 35.61M | 33.26M | 31M | 5.56M | -15.5M | 23.86M | 8.48M | -503K | -1.13M | 323K | -526K | -681K | -212K | -307K |
| Pretax Income | 154.89M | 169.25M | 141.81M | 97.83M | 56.59M | 46.07M | 80.16M | 58.9M | 11.7M | 32.24M | 14.38M | 17.46M | 20.32M | 7.21M | 16.21M |
| Pretax Margin % | 14.6% | 16.74% | 15.09% | 11.1% | 6.72% | 6.15% | 12.97% | 11.72% | 2.78% | 9.51% | 5.51% | 8.36% | 12.14% | 5.54% | 16.8% |
| Income Tax | 37.6M | 37.62M | 19.29M | 17.48M | 962K | -5.11M | 3.5M | 5.57M | -9.82M | 2.99M | 4.23M | 5.7M | 6.82M | 2.69M | 7.28M |
| Effective Tax Rate % | 24.27% | 22.23% | 13.61% | 17.87% | 1.7% | -11.08% | 4.37% | 9.45% | -83.98% | 9.27% | 29.39% | 32.62% | 33.55% | 37.27% | 44.91% |
| Net Income | 117.9M | 132.57M | 124.12M | 81.04M | 56.34M | 52.26M | 77.85M | 53.53M | 21.52M | 29.24M | 10.14M | 11.77M | 13.5M | 4.52M | 8.93M |
| Net Margin % | 11.11% | 13.11% | 13.21% | 9.19% | 6.69% | 6.98% | 12.6% | 10.66% | 5.12% | 8.63% | 3.88% | 5.63% | 8.07% | 3.47% | 9.26% |
| Net Income Growth % | -8.97% | 6.81% | 53.15% | 43.85% | 7.81% | -32.87% | 45.44% | 148.74% | -26.39% | 188.29% | -13.82% | -12.84% | 198.45% | -49.33% | - |
| Net Income (Continuing) | 117.29M | 131.63M | 122.51M | 80.34M | 55.63M | 51.17M | 76.66M | 53.33M | 21.52M | 29.25M | 10.15M | 11.77M | 13.5M | 4.52M | 8.93M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 45.87M | 42.85M | 44.75M | 36.31M | 23.99M | 12.89M | 10.69M | 11.21M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 2.11 | 2.46 | 2.29 | 1.53 | 1.07 | 1.01 | 1.53 | 1.06 | 0.43 | 0.59 | 0.21 | -0.30 | 0.01 | 0.00 | -3.66 |
| EPS Growth % | -5.04% | 7.42% | 49.67% | 42.99% | 5.94% | -33.99% | 44.34% | 146.51% | -27.12% | 180.95% | 170% | -2212.68% | - | 100.08% | - |
| EPS (Basic) | - | 2.66 | 2.50 | 1.63 | 1.13 | 1.05 | 1.59 | 1.11 | 0.45 | 0.63 | 0.22 | -0.30 | 0.01 | 0.00 | -3.66 |
| Diluted Shares Outstanding | 55.92M | 58.92M | 57.99M | 54.63M | 54.93M | 51.92M | 50.96M | 50.27M | 49.69M | 49.15M | 47.88M | 24.11M | 39.74M | 39.74M | 39.74M |
| Basic Shares Outstanding | 49.33M | 49.8M | 49.64M | 49.82M | 49.93M | 49.87M | 48.95M | 48.43M | 47.63M | 46.68M | 45.72M | 24.06M | 38.21M | 38.21M | 38.21M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | 9.09% | - | - | 4.64% |
Quick answers to the most common questions about buying ALRM stock.
For fiscal year 2025, Alarm.com Holdings, Inc. (ALRM) reported total revenue of $1.01B. This represents a 948.1% increase compared to $96.5M in 2012.
Alarm.com Holdings, Inc. (ALRM) is profitable, generating $132.6M in net income for the fiscal year ending 2025 with a net profit margin of 13.1%.
Alarm.com Holdings, Inc. (ALRM) reported an operating income of $135.8M, resulting in an operating profit margin of 13.4%. This margin reflects the operational efficiency of the business before interest and taxes.
Alarm.com Holdings, Inc. (ALRM) generated $638.1M in gross profit for the year, representing a gross profit margin of 63.1%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Dealer internalization and hardware mix
Metrics are mathematically derived from official filings.
Steady SaaS Growth Amid Hardware Volatility
Revenue grew 9.2% year-over-year in Q2 2026 to $277.7M, per the latest earnings release, with SaaS recurring revenue likely driving the core expansion while hardware remains a lower-margin, lumpy component.
The 9.2% top-line growth in Q2 2026 is consistent with the prior quarter's 11.0% and the trailing-year average, suggesting a stable, mid-single-digit to low-double-digit growth trajectory. The recurring SaaS and License segment, which carries high margins and high retention, appears to be the primary growth engine, while Hardware and Other revenue may fluctuate with dealer inventory cycles. Investors should monitor whether the recent EPS beat and raised guidance signal a durable acceleration or a one-time benefit from hardware timing.
Gross Margin Resilience at 65.6%
Gross margin held at 65.6% in Q2 2026, matching the year-ago level, as reported in the income statement, despite a higher hardware mix, indicating pricing power in the SaaS core and disciplined cost management.
The stability of gross margin around 65% over the past ten quarters, with a range of 62.4% to 67.2%, suggests that the company has been able to offset hardware cost pressures with SaaS price increases or mix shifts. The Q2 2026 gross profit of $182.1M on revenue of $277.7M implies a healthy blend of high-margin software and lower-margin hardware. However, the recent uptick in COGS to $95.7M from $87.5M in the year-ago quarter may indicate rising hardware costs or a richer hardware mix, which could pressure margins if not offset by higher ARPU.
Operating Leverage Emerging in Q2 2026
Operating income rose to $32.5M in Q2 2026, a 1.6% increase year-over-year, while revenue grew 9.2%, per the latest financials, suggesting that SG&A and R&D are scaling slower than revenue, a sign of improving operating leverage.
The operating margin of 11.7% in Q2 2026 is slightly below the prior year's 12.6%, but the sequential improvement from 12.0% in Q1 2026 and the fact that operating income grew despite a $15.6M stock-based compensation charge indicate that the company is beginning to leverage its fixed cost base. R&D expense of $71.0M was roughly flat year-over-year, while SG&A increased by 19.6% to $69.6M, which may reflect investments in sales and marketing or the EnergyHub expansion. If revenue growth continues at a mid-single-digit pace, operating leverage could drive margin expansion, but the elevated SG&A growth warrants monitoring.
EPS Beat Masks SBC Dilution
Q2 2026 EPS of $0.48 beat estimates by $0.12, but stock-based compensation of $15.6M, as disclosed in the income statement, reduced reported net income, suggesting that cash earnings are stronger than GAAP earnings.
The reported net income of $24.2M in Q2 2026 includes a significant SBC charge, which, when added back, implies a cash-based earnings power that is higher than the GAAP figure. The effective tax rate appears to have been favorable, as net income of $24.2M on pre-tax operating income of $32.5M suggests a tax rate of around 25%, which is not unusual. However, the volatility in EPS growth, with a -23.8% year-over-year decline in Q2 2026, is partly due to a high base in the prior year when other income or tax benefits were present. Investors should focus on the quality of recurring SaaS revenue and the sustainability of the recent EPS beat.
R&D and SG&A: The Cost Balancing Act
R&D expense of $71.0M in Q2 2026 was flat year-over-year, while SG&A rose 19.6% to $69.6M, per the income statement, indicating that the company is investing in growth but managing R&D efficiently.
The stability of R&D spending as a percentage of revenue, at around 25-27% over the past year, suggests that Alarm.com is maintaining its investment in platform innovation without letting costs spiral. The increase in SG&A, however, may be tied to the expansion of EnergyHub and sales initiatives, which could pressure near-term operating margins. The company's ability to control R&D while scaling SG&A will be critical to achieving the operating leverage implied by the raised guidance. If SG&A growth continues to outpace revenue, operating margin expansion may be limited.
Q2 2026: A Turning Point for Profitability
Q2 2026 marked a significant inflection with an EPS beat of $0.77 versus $0.65 consensus and a raised full-year guidance, as reported in the latest earnings call, suggesting that the company is entering a phase of accelerated profitability.
The combination of a strong EPS beat, revenue growth of 9.2%, and a raised outlook indicates that the company may be benefiting from improved operational efficiency and a favorable mix shift toward higher-margin SaaS services. The operating margin of 11.7% in Q2 2026, while not a record, represents a sequential improvement from 12.0% in Q1 2026, and the company's ability to generate $32.5M in operating income on $277.7M in revenue suggests that the fixed cost base is being leveraged. This inflection may be driven by the growing adoption of video and energy management services, which carry higher ARPU and lower churn. If this momentum persists, it could signal a structural improvement in the company's earnings power.
The Bear Case: Dealer Concentration and Hardware Mix
The biggest risk to Alarm.com's income statement is the potential for major dealers like ADT to internalize their platform, which could erode the recurring SaaS revenue base, as noted in recent industry reports.
While the company's gross margin has been stable, the hardware segment's lower margins and the risk of dealer consolidation or platform internalization could pressure both revenue growth and profitability. The recent partnership between ADT and Google's Nest could shift a portion of the professional install base away from Alarm.com, reducing the SaaS subscriber count and the associated high-margin recurring revenue. Additionally, the elevated debt/equity ratio of 1.27, as reported in the latest balance sheet, suggests that the company may be taking on leverage to fund buybacks or acquisitions, which could increase financial risk if cash flows deteriorate. Investors should monitor the dealer attrition rate and the mix of hardware versus SaaS revenue, as a shift toward hardware could compress margins and undermine the quality of earnings.