Key Highlights

● Revenue rose 2% to $1.312 billion with adjusted EBITDA of $671 million, a 51% margin.

● Capital expenditures totalled $262 million, while free cash flow was $404 million in the quarter.

● ADT repurchased 68 million shares for $478 million and declared a quarterly dividend of $0.055.

ADT (NYSE:ADT) combines a large recurring-revenue security and automation business with a capital-intensive model, and its latest quarter put that spending profile in focus. The company reported second-quarter 2026 results on July 30, 2026, showing modest revenue growth, strong cash generation and ongoing share repurchases. For investors, how much ADT spends on acquiring customers and installing equipment, and what is left afterwards, may be central to the story. The stock trades on the New York Stock Exchange.

Latest Company Context

In the second quarter of 2026, ADT reported total revenue of $1.312 billion, up 2% year over year, and net income of $154 million, or $0.19 per diluted share. Adjusted EBITDA was $671 million, a 51% margin. Operating cash flow was $666 million and free cash flow was $404 million. Using ADT's own definition, capital expenditures totalled $262 million in the quarter. That comprised $137 million for dealer-generated customer accounts and bulk account purchases, $79 million for subscriber system assets and $46 million for purchases of property and equipment.

The release noted that Solar no longer has a separate capital line, with only a $5 million adjustment relating to the former Solar business. Revenue growth was modest, but the margin profile and cash conversion underline why capital intensity, rather than demand alone, is often the key variable for the security alarm industry. Total capital spending represented roughly a fifth of quarterly revenue.

Key Business and Index Drivers

Capital intensity is a defining feature of ADT's model. Spending on dealer accounts and subscriber systems is largely tied to adding and retaining recurring revenue customers, so the pace of investment may influence future revenue as well as near-term free cash flow. Against that, the company is returning capital. It declared a quarterly dividend of $0.055 per share on July 30, 2026, payable October 1, 2026 to holders of record on September 10, 2026. In the second quarter it repurchased 68 million shares for $478 million, including 29 million shares linked to Apollo's secondary offering, and $906 million remained authorised at June 30. Together, the dividend and buybacks showed that management is balancing reinvestment with returns. Dividend payments in the quarter totalled $45 million, a small portion of the cash returned compared with repurchases.

What Investors Should Watch

Management raised its 2026 guidance, now calling for adjusted free cash flow growth of about 30%, total revenue growth of about 2% and adjusted EPS growth of about 2%, all against 2025. The release did not give dollar amounts for those targets. Investors may watch whether the mix of capital spending shifts, for example between dealer acquisitions and subscriber equipment, and whether the spending supports the revenue growth in guidance. The pace of share repurchases, the future of the dividend and any change in leverage may also be relevant, since the release defined a net leverage ratio but did not report a figure for the quarter. Updates on Apollo's holding could affect trading volume and sentiment. Competitive pressure from newer smart-home and do-it-yourself security providers may also influence how much ADT needs to spend on acquiring customers.

Spending to Sustain Recurring Revenue While Returning Cash

ADT's latest results show a business that spends heavily to sustain recurring revenue yet still produced $404 million of free cash flow in a single quarter. Whether capital spending remains disciplined while buybacks and dividends continue could shape the outlook. Investors may continue to monitor the filings for any change in capital allocation.