15 unchanged sentences
The initiative includes certain aspects of our customer relationship management and enterprise resource planning systems.
−Removed: In 2024, we nationally launched our customer relationship management system for our residential pro-install customers, which resulted in changes to our processes and procedures as well as to our ICFR;
−Removed: however, we concluded that this launch has not currently materially affected our ICFR.
+Added: In 2024, we nationally launched our customer relationship management system for our residential pro-install customers, which resulted in changes to our processes, procedures, and our ICFR;
+Added: and expect these changes to materially affect our ICFR in 2026.
In addition, we began the transition to our new enterprise resource planning system during 2024.
23 unchanged sentences
_________________
−Removed: (1) Column (a) includes approximately 1 million shares of Common Stock that may be issued upon the exercise of service-based stock options and 1 million shares of Common Stock that may be issued upon the exercise of performance-based stock options.
+Added: (1) Column (a) includes approximately 543,000 shares of Common Stock that may be issued upon the exercise of service-based stock options and approximately 603,000 shares of Common Stock that may be issued upon the exercise of performance-based stock options.
We do not expect to issue additional share-based compensation awards under the 2016 Plan.
2 unchanged sentences
Excluding RSUs, the weighted-average exercise price is equal to $8.96.
−Removed: Column (c) includes an additional 50 million shares that were authorized for issuance during 2024 as disclosed on Form S-8 filed with the SEC on February 14, 2025.
−Removed: Apollo Margin Loan Agreement
−Removed: As of October 3, 2019, certain investment funds directly or indirectly managed by Apollo (the “Apollo Funds”), informed the Company that they have pledged all of their shares of the Company’s Common Stock, which as of December 31, 2024, amounted to 359,150,366 shares, pursuant to a margin loan agreement and related documentation, as thereafter amended from time to time, on a non-recourse basis.
−Removed: Additionally, the loan to value ratio of the margin loan was equal to approximately 28.7%.
−Removed: The margin loan agreement contains customary default provisions and that in the event of a default under the margin loan agreement the secured parties may foreclose upon any and all shares of the Company’s Common Stock pledged to them.
−Removed: Certain members of the Company’s executive team and certain employees of the Company were entitled to receive their share of the margin loan proceeds (based on their share ownership of the Apollo Funds) at such times as Apollo received its proceeds.
−Removed: Such persons had the option to either (a) receive such proceeds as distributed or (b) to defer receipt of such proceeds until their attributable share of the obligations under the margin loan have been satisfied in full.
−Removed: In the case of elections to receive such proceeds as distributed, such proceeds remain subject to recall until such time as all obligations under the margin loan agreement and related documentation are satisfied in full.
−Removed: The Company has not independently verified the foregoing disclosure.
−Removed: When the margin loan agreement was entered into, and as requested when amended, the Company delivered customary letter agreements to the secured parties in which it has, among other things, agreed, subject to applicable law and stock exchange rules, not to take any actions that are intended to hinder or delay the exercise of any remedies by the secured parties under the margin loan agreement and related documentation, as amended.
−Removed: Except for the foregoing, the Company is not a party to the margin loan agreement and related documentation and does not have, and will not have, any obligations thereunder.
−Removed: PRINCIPAL ACCOUNTANT FEES AND SERVICES.
−Removed: The information required by this Item 14 “Principal Accountant Fees and Services” is incorporated herein by reference from our Proxy Statement.
+Added: Origin AI Retention Awards
+Added: In connection with the Company’s acquisition of Origin AI, the Board of Directors approved a grant of RSUs (the “Origin AI Retention Awards”) as a material inducement for certain key employees of Origin AI to remain employed with the Company following such acquisition.
+Added: The Company filed a registration statement on Form S-8, which registers 8.1 million shares of Common Stock that are issuable upon vesting and settlement of the Origin AI Retention Awards.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE.
The information required by this Item 13 “Certain Relationships and Related Transactions and Director Independence” is incorporated herein by reference from our Proxy Statement.
+Added: PRINCIPAL ACCOUNTANT FEES AND SERVICES.
+Added: The information required by this Item 14 “Principal Accountant Fees and Services” is incorporated herein by reference from our Proxy Statement.
EXHIBIT AND FINANCIAL STATEMENT SCHEDULES.
6 unchanged sentences
The information required by this Item is set forth on the exhibit index below.
−Removed: Exhibit Number Incorporated by Reference
+Added: Incorporated by Reference
Exhibit Description Form Exhibit Filing Date
−Removed: Share Purchase Agreement, dated September 30, 2019, among ADT Security Holdings Canada Ltd., ADT Inc., and TELUS Communications Inc.
−Removed: 8-K 2.1 10/1/2019
Purchase Agreement, dated November 8, 2021, by and among The ADT Security Corporation, Compass Solar Group, LLC, MGG SPV VIII LLC, MGG SPV VII LLC, Compass Group Management, LLC, the Company Members party thereto, the Blocker Members party thereto, and ADT Inc.
10-K 2.2 3/1/2022
−Removed: Equity Purchase Agreement, dated as of August 7, 2023, among ADT Inc., Iris Buyer LLC and Fire & Security Holdings, LLC
Amended and Restated Certificate of Incorporation of ADT Inc.
−Removed: 3.1 9/17/2020
+Added: 10-Q 3.1 7/24/2025
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of ADT Inc.
+Added: 10-Q 3.1 8/1/2024
Amended and Restated Bylaws of ADT Inc.
5 unchanged sentences
S-1 4.4 12/21/2017
−Removed: Fourth Supplemental Indenture, dated as of January 14, 2013, by and between The ADT Corporation and Wells Fargo Bank, National Association
−Removed: S-1 4.5 12/21/2017
Sixth Supplemental Indenture, dated as of April 8, 2016, under 2012 Base Indenture, by and among The ADT Corporation, the guarantors party thereto and the Wells Fargo Bank, National Association
4 unchanged sentences
S-1 4.9 12/21/2017
−Removed: Ninth Supplemental Indenture, dated as of November 15, 2017, under 2012 Base Indenture, by and among The ADT Security Corporation, DataShield, LLC and Wells Fargo Bank, National Association
−Removed: 10-K 4.10 3/11/2019
−Removed: Twelfth Supplemental Indenture, dated as of January 7, 2019, under 2012 Base Indenture, by and among The ADT Security Corporation, the guarantors party thereto and Wells Fargo Bank, National Association
−Removed: 10-K 4.13 3/11/2019
Fifteenth Supplemental Indenture, dated as of November 14, 2019, under 2012 Base Indenture, by and among The ADT Security Corporation, I-View Now LLC and Wells Fargo Bank, National Association
10-K 4.16 3/10/2020
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
Indenture, dated as of May 2, 2016, by and between Prime Security One MS, Inc.
5 unchanged sentences
S-1 4.18 12/21/2017
−Removed: Third Supplemental Indenture, dated as of November 15, 2017, by and among The ADT Security Corporation, DataShield, LLC and Wells Fargo Bank, National Association
−Removed: 10-K 4.27 3/11/2019
−Removed: Sixth Supplemental Indenture, dated as of January 7, 2019, by and among The ADT Security Corporation, the guarantors party thereto and Wells Fargo Bank, National Association
−Removed: 10-K 4.30 3/11/2019
Ninth Supplemental Indenture, dated as of November 14, 2019, by and among The ADT Security Corporation, I-View Now LLC and Wells Fargo Bank, National Association
2 unchanged sentences
8-K 4.2 4/4/2019
−Removed: First Supplemental Indenture, dated as of November 14, 2019, by and among Prime Security Services Borrower, LLC, Prime Finance, Inc., I-View Now LLC and Wells Fargo Bank, National Association
−Removed: 10-K 4.49 3/10/2020
−Removed: Indenture, dated as of April 4, 2019, by and among Prime Security Services Borrower, LLC, Prime Finance Inc., the guarantors party thereto from time to time, and Wells Fargo Bank, National Association, as trustee, relating to the $750 million aggregate principal amount of 5.750% first-priority senior secured notes due 2026.
−Removed: 8-K 4.2 4/4/2019
+Added: Incorporated by Reference
+Added: Exhibit Description Form Exhibit Filing Date
First Supplemental Indenture, dated as of September 23, 2019, by and among Prime Security Services Borrower, LLC, Prime Finance Inc., the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee, relating to the $600 million aggregate principal amount of 5.750% first-priority senior secured notes due 2026
20 unchanged sentences
10-Q 4.6 5/6/2022
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
Fourth Supplemental Indenture, dated as of January 7, 2022, by and among Prime Security Services Borrower, LLC, Prime Finance, Inc., Compass Solar Group, LLC, Marc Jones Construction, L.L.C., Buildpro, L.L.C., Energypro LLC and Wells Fargo Bank, National Association
12 unchanged sentences
10-Q 4.13 5/6/2022
+Added: Incorporated by Reference
+Added: Exhibit Description Form Exhibit Filing Date
Second Supplemental Indenture, dated as of April 28, 2022, by and among The ADT Security Corporation, ADT Innovation LLC and Wells Fargo Bank, National Association
10-Q 4.14 5/6/2022
+Added: First-Priority Senior Secured Notes Indenture, dated as of October 15, 2025, by and among The ADT Security Corporation, the guarantors party thereto, and Computershare Trust Company, N.A., as trustee.
+Added: 8-K 4.1 10/15/2025
Description of Securities
6 unchanged sentences
Supplement No.
−Removed: 2, dated as of October 31, 2017, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
−Removed: 10-K 10.55 3/11/2019
−Removed: Supplement No.
3, dated as of January 22, 2018, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
1 unchanged sentence
Supplement No.
−Removed: 4, dated as of February 28, 2018, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
−Removed: 10-K 10.57 3/11/2019
−Removed: Supplement No.
−Removed: 5, dated as of August 17, 2018, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
−Removed: 10-K 10.58 3/11/2019
−Removed: Supplement No.
−Removed: 6, dated as of January 2, 2019, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
−Removed: 10-K 10.59 3/11/2019
−Removed: Supplement No.
−Removed: 7, dated as of January 30, 2019, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
−Removed: 10-K 10.60 3/11/2019
−Removed: Supplement No.
8, dated as of March 11, 2019, to the Subsidiary Guarantee Agreement (First Lien) dated as of July 1, 2015, by each subsidiary of Prime Security Services Borrower, LLC party thereto and Barclays Bank PLC, as Collateral Agent
6 unchanged sentences
10-Q 10.5 5/6/2022
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
Holdings Guarantee and Pledge Agreement (First Lien), dated and effective as of July 1, 2015, between Prime Security Services Holdings, LLC, as Holdings, and Credit Suisse AG, Cayman Islands Branch, as Collateral Agent
20 unchanged sentences
10-Q 10.23 5/7/2020
+Added: Incorporated by Reference
+Added: Exhibit Description Form Exhibit Filing Date
Receivables Financing Agreement, among ADT LLC, ADT Finance LLC and Mizuho Bank, Ltd., dated as of July 16, 2021
20 unchanged sentences
10-K 10.31 2/25/2021
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
Amendment to the ADT LLC Supplemental Savings and Retirement Plan, effective as of December 24, 2018
12 unchanged sentences
10-K 10.40 2/28/2023
+Added: Amendment to the ADT LLC Supplemental Savings and Retirement Plan, effective as of September 27, 2023
Amended and Restated Stockholders Agreement, dated as of December 14, 2018, by and between the ADT Inc.
16 unchanged sentences
and Google LLC
+Added: 10-K 10.46 2/28/2024
Amendment No.
1 unchanged sentence
and Google LLC
+Added: 10-K 10.47 2/28/2024
Amended and Restated Employment Agreement, dated December 19, 2017, between The ADT Security Corporation (together with any of its subsidiaries and Affiliates) and Donald Young
4 unchanged sentences
S-1 10.31 12/21/2017
+Added: Incorporated by Reference
+Added: Exhibit Description Form Exhibit Filing Date
Employment Offer Letter, dated February 1, 2019, between ADT LLC (with its Affiliates and Successors) and David Smail
+Added: 10-K 10.51 2/28/2023
2018 Omnibus Incentive Plan
5 unchanged sentences
2018 Omnibus Incentive Plan, dated May 22, 2024
+Added: 10.5 8/1/2024
Form of Restricted Stock Unit Award Agreement for use under the ADT Inc.
21 unchanged sentences
10-Q 10.48 5/7/2020
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
Form of Restricted Stock Unit Award Agreement for use under the ADT Inc.
10 unchanged sentences
SC TO-I (d)(35) 9/12/2022
+Added: Form of Restricted Stock Unit Inducement Award Agreement
Second Amended & Restated Employment Agreement with James D.
7 unchanged sentences
10-K 10.63 3/1/2022
−Removed: Securities Purchase Agreement, dated as of September 5, 2022, by and between ADT Inc.
−Removed: and State Farm Fire & Casualty Company
−Removed: 8-K 10.1 9/6/2022
−Removed: Tender and Support Agreement, dated as of September 5, 2022, by and between ADT Inc., Prime Security Services TopCo (ML), L.P.
−Removed: and Prime Security Services TopCo (ML II), L.P
−Removed: 8-K 10.2 9/6/2022
Support Agreement, dated as of September 5, 2022, by and between ADT Inc.
15 unchanged sentences
2018 Omnibus Incentive Plan, effective as of March 8, 2024
+Added: 10-Q 10.2 4/25/2024
Form of Indemnification Agreement by and between the Company and each of its Directors and Executive Officers
−Removed: Commitment Letter by and among Prime Security Services Borrower, LLC, The ADT Security Corporation, Deutsche Bank Securities Inc., Deutsche Bank AG New York Branch, BNP Paribas, Mizuho Bank, Ltd., MUFG Bank, Ltd., Citizens Bank, N.A., Citigroup Global Markets Inc., Morgan Stanley Senior Funding, Inc., Royal Bank of Canada, Barclays Bank PLC, ING Capital LLC and Credit Suisse AG, New York Branch, dated as of September 15, 2022
−Removed: 8-K 10.1 9/15/2022
+Added: 10-Q 10.3 10/24/2024
Investor Rights Agreement, dated as of October 13, 2022, by and between ADT Inc.
5 unchanged sentences
8-K 10.1 12/15/2022
+Added: Incorporated by Reference
+Added: Exhibit Description Form Exhibit Filing Date
Amendment No.2 to Amended and Restated Management Investor Rights Agreement, dated as of August 1, 2024, by and among ADT Inc., Prime Security Services TopCo Parent and the Holders party thereto
−Removed: Term Loan Credit Agreement, by and among Prime Security Services Holdings, LLC, as Holdings, Prime Security, Services Borrower, LLC and the ADT Security Corporation, as borrowers, Barclays Bank PLC, as Administrative Agent, and the lenders party thereto, as dated as of March 14, 2023
+Added: 10-Q 10.6 8/1/2024
+Added: Fourth Amendment to the Receivables Financing Agreement, among ADT Finance LLC, Mizuho Bank, Ltd., ADT LLC, MUFG Bank, Ltd., Starbird Funding Corporation, and BNP Paribas, dated as of March 29, 2023
8-K 10.1 3/30/2023
−Removed: Incremental Assumption and Amendment Agreement No.
−Removed: 18, dated as of December 4, 2024, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the subsidiary loan parties party thereto, the lenders party thereto and Barclays Bank PLC, as administrative agent.
−Removed: Receivables Financing Agreement, among Compass Solar Group, LLC, ADT Solar Finance LLC and Mizuho Bank, Ltd., dated as of August 2, 2023.
Sixth Amendment to the Receivables Financing Agreement, among ADT Finance LLC, Mizuho Bank, Ltd., ADT LLC, MUFG Bank, Ltd., Starbird Funding Corporation, and BNP Paribas, dated as of April 10, 2024 .
−Removed: Exhibit Number Incorporated by Reference
−Removed: Exhibit Description Form Exhibit Filing Date
+Added: 8-K 10.1 4/12/2024
+Added: Seventh Amendment to the Receivables Financing Agreement, among ADT Finance LLC, Mizuho Bank, Ltd., ADT LLC, MUFG Bank, Ltd., Starbird Funding Corporation, and BNP Paribas, dated as of March 27, 2025.
+Added: 8-K 10.1 4/2/2025
+Added: Retirement and Consulting Agreement, dated March 6, 2025 by and between The ADT Security Corporation (together with its subsidiaries, affiliates and successors) and Donald Young.
+Added: 10-Q 10.3 4/24/2025
+Added: Employment Offer Letter, dated September 12, 2023 between ADT LLC (together with its affiliates and successors) and David Scott.
+Added: 10-Q 10.5 4/24/2025
+Added: Employment Offer Letter, dated March 18, 2025 between ADT LLC (together with its affiliates and successors) and Fawad Ahmad.
+Added: 10-Q 10.5 7/24/2025
+Added: Incremental Assumption and Amendment Agreement No.
+Added: 21, dated as of October 24, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the subsidiary loan parties party thereto, the lenders party thereto and Barclays Bank PLC, as administrative agent.
+Added: 8-K 10.1 10/28/2025
+Added: Term Loan Credit Agreement, dated as of October 28, 2025, by and among Prime Security Services Holdings, LLC, Prime Security Services Borrower, LLC, The ADT Security Corporation, the lenders party thereto and Fifth Third Bank, National Association, as administrative agent.
+Added: 8-K 10.2 10/28/2025
+Added: Employment Offer Letter, dated March 3, 2025 between ADT LLC (together with its affiliates and successors) and Omar Khan.
Insider Trading Policy
+Added: 10-K 19.1 2/27/2025
Subsidiaries of ADT Inc.
7 unchanged sentences
Policy Relating to Incentive Compensation Clawback
+Added: 10-K 97.1 2/28/2024
101 XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
−Removed: _________________________
Confidential treatment requested.
5 unchanged sentences
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
−Removed: February 27, 2025 By:
+Added: March 2, 2026 By:
Chairman, President and Chief Executive Officer
−Removed: Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on February 27, 2025.
+Added: Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on March 2, 2026.
DeVries Chairman, President and Chief Executive Officer
7 unchanged sentences
Nicole Bonsignore
−Removed: /s/ Marques Coleman Director
−Removed: Marques Coleman
/s/ Thomas M.
6 unchanged sentences
Daniel Houston
−Removed: /s/ William M.
−Removed: Lewis, Jr Director
Rayman Director
Smith Director
−Removed: Solomon Director
/s/ Danielle Tiedt Director
6 unchanged sentences
Report of Independent Registered Public Accounting Firm (PCAOB ID 238 )
−Removed: Consolidated Balance Sheets as of December 31, 2024 and 2023
−Removed: Consolidated Statements of Operations for the years ended December 31, 2024, 2023, and 2022
−Removed: Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2024, 2023, and 2022
−Removed: Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024, 2023, and 2022
−Removed: Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022
+Added: Consolidated Balance Sheets
+Added: Consolidated Statements of Operations
+Added: Consolidated Statements of Comprehensive Income (Loss)
+Added: Consolidated Statements of Stockholders’ Equity
+Added: Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
6 unchanged sentences
Share-Based Compensation
−Removed: Net Income (Loss) per Share
+Added: Earnings per Share
Commitments and Contingencies
2 unchanged sentences
Condensed Financial Information of Registrant
−Removed: Selected Quarterly Financial Data (Unaudited)
Report of Independent Registered Public Accounting Firm
29 unchanged sentences
The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Discontinued Operations – Solar Business
−Removed: As described in Note 4 to the consolidated financial statements, on January 19, 2024, the Company’s board of directors approved a plan to fully exit the solar business (the “ADT Solar Exit”).
−Removed: As of June 30, 2024, substantially all operations of the Solar Business had ceased, and the solar business is presented as a discontinued operation.
−Removed: As a result, the Company presented total liabilities of discontinued operations of $47.7 million as of December 31, 2024 and a loss from discontinued operations, net of tax of $110.1 million for the year ended December 31, 2024.
−Removed: The principal considerations for our determination that performing procedures relating to the discontinued operations of the solar business is a critical audit matter are a high degree of auditor subjectivity and effort in performing procedures and evaluating audit evidence related to management’s assessment, classification, timing and disclosure of the discontinued operations.
+Added: Revenue Recognition – Customer Owned Transactions
+Added: As described in Note 2 to the consolidated financial statements, the Company’s customer owned transactions include installation revenue of $416 million and a portion of recurring monthly revenue of $4.2 billion for the year ended December 31, 2025.
+Added: In transactions involving security systems sold outright to the customer, the Company’s performance obligations generally include the sale and installation of the security system, which is primarily recognized at a point in time based upon the nature of the transaction and contractual terms, and any monitoring and related services, which are recognized when these services are provided to the customer.
+Added: Management allocates the transaction price to each performance obligation based on the relative standalone selling price, which is determined using observable internal and external pricing, profitability, and operational metrics.
+Added: The principal consideration for our determination that performing procedures relating to revenue recognition for customer owned transactions is a critical audit matter is a high degree of auditor effort in performing procedures related to the Company’s revenue recognition.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.
−Removed: These procedures included testing the effectiveness of controls related to management’s discontinued operations assessment, including controls related to management’s classification, timing, and disclosure of the discontinued operations in the Company’s consolidated financial statements.
−Removed: These procedures also included, among others, (i) evaluating management’s assessment that the ADT Solar Exit was a discontinued operation;
−Removed: (ii) testing the classification of amounts included in discontinued operations, including agreeing such amounts to the Company’s historical accounting records;
−Removed: (iii) evaluating the sufficiency of the disclosures in the consolidated financial statements;
−Removed: and (iv) evaluating the reasonableness of the timing of management’s recognition of the discontinued operation.
−Removed: Evaluating the reasonableness of the timing of the discontinued operations involved, (i) evaluating management’s plan to wind down the solar business, including the reasonableness of projected exit charges;
−Removed: (ii) testing the completeness and accuracy of incurred exit charges;
−Removed: and (iii) evaluating whether substantially all operations ceased as of June 30, 2024.
+Added: These procedures included testing the effectiveness of controls relating to the customer owned transactions revenue recognition process.
+Added: These procedures also included, among others, (i) testing revenue recognized for a sample of revenue transactions by obtaining and inspecting source documents, such as contracts, invoices, and subsequent cash receipts including testing the allocation of transaction price to the performance obligation based on relative standalone selling price, if applicable;
+Added: (ii) testing a sample of selling price data used to determine the standalone selling price of the performance obligations;
+Added: and (iii) confirming a sample of outstanding customer invoice balances as of December 31, 2025 and, for confirmations not returned, obtaining and inspecting source documents, such as contracts, invoices, and subsequent cash receipts.
/s/ PricewaterhouseCoopers LLP
Miami, Florida
−Removed: February 27, 2025
+Added: March 2, 2026
We have served as the Company’s auditor since 2010.
9 unchanged sentences
Prepaid expenses and other current assets 250,325 210,613
−Removed: Current assets of discontinued operations — 60,957
Total current assets 945,552 1,004,920
5 unchanged sentences
Other assets 683,271 735,319
−Removed: Noncurrent assets of discontinued operations — 43,279
Total assets $ 15,818,511 $ 16,050,957
6 unchanged sentences
Current liabilities of discontinued operations
+Added: 15,317 31,763
Total current liabilities 1,012,948 1,263,780
4 unchanged sentences
Noncurrent liabilities of discontinued operations
+Added: 14,352 15,889
Total liabilities 12,039,901 12,250,156
27 unchanged sentences
Depreciation and intangible asset amortization 1,367,216 1,342,798 1,335,484
−Removed: Merger, restructuring, integration, and other 24,124 38,959 9,937
Operating income (loss) 1,308,901 1,208,064 1,178,961
Interest expense, net
−Removed: Loss on extinguishment of debt ( 4,802 ) ( 16,621 ) —
+Added: ( 459,266 ) ( 441,031 ) ( 569,915 )
Other income (expense) ( 15,823 ) 48,137 ( 4,663 )
−Removed: Income (loss) from continuing operations before income taxes and equity in net earnings (losses) of equity method investee 815,170 604,383 404,458
+Added: Income (loss) from continuing operations before income taxes 833,812 815,170 604,383
Income tax benefit (expense) ( 233,294 ) ( 195,780 ) ( 160,585 )
2 unchanged sentences
Income (loss) from continuing operations
+Added: 600,518 619,390 450,370
Income (loss) from discontinued operations, net of tax
+Added: ( 4,567 ) ( 118,337 ) 12,639
Net income (loss) $ 595,951 $ 501,053 $ 463,009
33 unchanged sentences
Other comprehensive income (loss), net of tax:
−Removed: Cash flow hedges 6,008 32,129 25,754
−Removed: Other 3,118 ( 1,091 ) ( 3,981 )
−Removed: Total other comprehensive income (loss), net of tax 9,126 31,038 21,773
+Added: Cash flow hedges and other 5,478 9,126 31,038
Comprehensive income (loss) $ 601,429 $ 510,179 $ 494,047
7 unchanged sentences
Other comprehensive income (loss), net of tax — — — — — — 31,038 31,038
−Removed: Issuance of common stock, net of expenses 140,681 — 1,407 — 1,188,488 — — 1,189,895
−Removed: Repurchases of common stock ( 133,333 ) — ( 1,333 ) — ( 1,093,334 ) — — ( 1,094,667 )
Dividends — — — — — ( 129,025 ) — ( 129,025 )
Share-based compensation expense — — — — 51,137 — — 51,137
−Removed: Contingent forward purchase contract — — — — ( 41,938 ) — — ( 41,938 )
Transactions related to employee share-based compensation plans and other 5,334 — 53 — ( 18,591 ) ( 2,123 ) — ( 20,661 )
4 unchanged sentences
Share-based compensation expense — — — — 48,613 — — 48,613
+Added: Repurchases of common stock (including excise tax) ( 36,000 ) — ( 360 ) — ( 346,576 ) — — ( 346,936 )
Transactions related to employee share-based compensation plans and other 5,158 — 52 — 1,756 ( 2,111 ) — ( 303 )
24 unchanged sentences
Goodwill, intangible, and other asset impairments
+Added: 15,129 24,313 528,556
(Gain) loss on sales of businesses — 9,557 ( 649,095 )
Unrealized (gain) loss on interest rate swap contracts 71,445 45,160 38,497
−Removed: Change in fair value of other financial instruments — — 63,396
Other non-cash items, net 72,846 ( 34,089 ) 100,087
2 unchanged sentences
Long-term retail installment contracts 140,564 211,731 184,925
−Removed: Inventories and work-in-progress 25,072 24,732 ( 67,391 )
Other assets ( 40,578 ) ( 109,839 ) ( 29,144 )
11 unchanged sentences
Purchases of property and equipment ( 175,747 ) ( 163,805 ) ( 176,353 )
−Removed: Proceeds (payments) from sale of business, net of cash sold ( 17,506 ) 1,609,347 26,749
+Added: Proceeds (payments) from divestiture of businesses
+Added: 50,557 ( 17,506 ) 1,609,347
Proceeds (payments) from interest rate swaps ( 2,363 ) ( 8,268 ) —
2 unchanged sentences
Cash flows from financing activities:
−Removed: Proceeds from issuance of common stock, net of expenses — — 1,180,000
Proceeds from long-term borrowings 2,952,072 1,068,907 867,178
Proceeds from receivables facility 269,010 228,569 281,647
−Removed: Repurchases of common stock ( 240,556 ) — ( 1,200,000 )
+Added: Repurchases of common stock, including excise tax ( 606,767 ) ( 240,556 ) —
Repayment of long-term borrowings, including call premiums ( 3,012,376 ) ( 1,186,045 ) ( 2,961,798 )
3 unchanged sentences
Proceeds (payments) from opportunity fund
+Added: ( 77,876 ) ( 6,895 ) ( 8,746 )
Proceeds (payments) from interest rate swaps 66,900 93,040 82,750
1 unchanged sentence
Net cash provided by (used in) financing activities
+Added: ( 861,914 ) ( 515,356 ) ( 2,143,849 )
Cash and cash equivalents and restricted cash and restricted cash equivalents:
21 unchanged sentences
and its related funds that are directly or indirectly managed by affiliates of Apollo Global Management, Inc.
−Removed: (together with its subsidiaries and affiliates, “Apollo” or the “Sponsor”).
−Removed: Following a registered secondary offering of the Company’s Common Stock by certain Apollo affiliates (and the Company’s concurrent repurchase from the underwriters of 15 million shares of Common Stock that were the subject of the offering), including the exercise of the underwriters’ overallotment option which closed on March 19, 2024, Apollo beneficially owns less than 50 % of the Company’s outstanding common stock, which includes Common Stock and Class B common stock (“Class B Common Stock”) combined, and less than 50 % of the Company’s outstanding Common Stock, and the Company ceased to be a “controlled company” under the New York Stock Exchange (the “NYSE”) rules.
−Removed: Refer to Note 16 “Related Party Transactions” for more information regarding all of Apollo’s registered secondary offerings of the Company’s Common Stock (collectively, the “Offerings”).
+Added: (together with its subsidiaries and affiliates, “Apollo”).
+Added: Following a registered secondary offering of the Company’s Common Stock by certain Apollo affiliates (and the Company’s concurrent repurchase from the underwriters of 15 million shares of Common Stock that were the subject of the offering), including the exercise of the underwriters’ overallotment option, the Company ceased to be a “controlled company” under the New York Stock Exchange (the “NYSE”) rules.
+Added: Refer to Note 16 “Related Party Transactions” for more information regarding Apollo’s registered secondary offerings of the Company’s Common Stock (collectively, the “Offerings”).
+Added: Subsequent Event - Origin Wireless, Inc.
+Added: (“Origin AI”) Acquisition
+Added: On February 20, 2026, ADT acquired Origin AI , a provider of AI‑enabled presence detection and ambient sensing technology (the “Origin AI Acquisition”).
+Added: Origin AI’s technology uses artificial intelligence and radio frequency signals to detect and classify human presence and activity within the home without the use of cameras, audio, or wearable devices.
+Added: This technology is expected to enhance our ability to deliver improved alarm verification, reduce false alarms, and support new intelligent security and smart home use cases over time.
+Added: The purchase price for the Origin AI Acquisition was $ 170 million in cash, subject to customary purchase price adjustments.
+Added: Origin AI is now an indirect wholly owned subsidiary of ADT.
+Added: The Company will account for the Origin AI Acquisition under the acquisition method of accounting and is currently evaluating the fair values of assets acquired and liabilities assumed.
Basis of Presentation
1 unchanged sentence
dollars in accordance with generally accepted accounting principles in the United States of America (“GAAP”).
−Removed: The financial statements included herein comprise the consolidated results of ADT Inc.
−Removed: and its wholly-owned subsidiaries.
−Removed: The results of companies acquired are included from the effective date of each acquisition;
−Removed: and all intercompany transactions have been eliminated.
−Removed: The Company used the equity method of accounting to account for an investment in which it had the ability to exercise significant influence but does not control.
+Added: The financial statements included herein are comprised of the consolidated results of ADT Inc.
+Added: and its wholly-owned subsidiaries for which all intercompany transactions have been eliminated.
+Added: The Company used the equity method of accounting to account for an investment in which it had the ability to exercise significant influence but did not control.
This investment was disposed of during 2023.
Certain prior period amounts have been reclassified to conform with the current period presentation.
+Added: Beginning in the first quarter of 2025, amounts previously disclosed under the caption merger, restructuring, integration, and other are presented within selling, general, and administrative expenses (“SG&A”) in the Consolidated Statements of Operations as they are no longer material for the periods presented .
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Use of Estimates
−Removed: The preparation of the consolidated financial statements in accordance with GAAP requires the Company to select accounting policies and make estimates that affect amounts reported in the consolidated financial statements and the accompanying notes.
+Added: The preparation of these consolidated financial statements in accordance with GAAP requires the Company to select accounting policies and make estimates that affect amounts reported in the consolidated financial statements and the accompanying notes.
The Company’s estimates are based on the relevant information available at the end of each period.
Actual results could differ materially from these estimates under different assumptions or market conditions.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The Company evaluates and reports information based on the manner in which our Chief Executive Officer (“CEO”), who is the chief operating decision maker (“CODM”), evaluates performance and allocates resources.
−Removed: The CODM manages the business on a consolidated basis, and as such, the Company reports results in a single operating and reportable segment which reflects the business operations of the Company’s former Consumer and Small Business (“CSB”) segment.
+Added: Segment Information
+Added: The Company evaluates and reports information based on the manner in which the chief operating decision maker (“CODM”) evaluates performance and allocates resources.
+Added: The CODM manages the business on a consolidated basis, and as such, the Company reports results in a single operating and reportable segment.
Refer to Note 3 “Segment Information.”
Discontinued Operations
−Removed: The Company’s exit in 2024 from its residential solar business (the “Solar Business”) (the “ADT Solar Exit”) and the sale in 2023 of its former commercial business (the “Commercial Business”) represented strategic shifts that had major effects on the Company’s operations and financial results.
−Removed: Accordingly, the results of operations and financial position of the Solar and Commercial Businesses are classified as discontinued operations in the Company’s Consolidated Statements of Operations and the Company’s Consolidated Balance Sheet for all periods presented.
−Removed: The cash flows and comprehensive income (loss) of discontinued operations have not been segregated and are included in the Consolidated Statements of Cash Flows and Consolidated Statements of Comprehensive Income (Loss), respectively, for all periods presented.
−Removed: Unless otherwise noted, amounts and disclosures throughout these Notes to Consolidated Financial Statements relate to the Company’s continuing operations.
−Removed: Refer to Note 4 “Divestitures” for additional information.
+Added: The Company’s exit in 2024 from the residential solar business (the “Solar Business”) (the “ADT Solar Exit”) and the sale in 2023 of its commercial business (the “Commercial Business”) (the “Commercial Divestiture”) represented strategic shifts that had major effects on the Company’s operations and financial results.
+Added: As applicable, the results of operations and financial position of these businesses are classified as discontinued operations in the Company’s Consolidated Statements of Operations and the Company’s Consolidated Balance Sheet, respectively.
+Added: The Consolidated Statements of Cash Flows and Consolidated Statements of Comprehensive Income (Loss) present both continuing and discontinued operations, as applicable.
+Added: Refer to Note 4 “Divestitures.”
+Added: Unless otherwise noted, the following Notes to Consolidated Financial Statements refer to the Company’s continuing operations only.
Accounting Standards Updates (“ASU”)
Recently Adopted
−Removed: Reportable Segment Disclosures - ASU 2023-07, Segment Reporting (Topic 280):
−Removed: Improvements to Reportable Segment Disclosures , improves reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.
−Removed: In addition, the guidance, among other requirements, enhances interim disclosures, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, and provides new segment disclosure requirements for entities with a single reportable segment.
−Removed: The Company adopted this guidance effective January 1, 2024, and it was applied retrospectively to all periods presented.
−Removed: Refer to Note 3 “Segment Information.”
−Removed: Supplier Finance Program Obligations - ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50):
−Removed: Disclosure of Supplier Finance Program Obligations, requires that a reporting entity who is a buyer in a supplier finance program disclose qualitative and quantitative information about its supplier finance programs, including a roll-forward of the obligations.
−Removed: The Company adopted this guidance effective January 1, 2023, except the roll-forward requirement, which was adopted effective January 1, 2024.
−Removed: The Company does not currently have any material supplier finance programs, and the guidance will be applied prospectively to any future material arrangements.
−Removed: Fair Value of Equity Securities - ASU 2022-03, Fair Value Measurement (Topic 820):
−Removed: Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, states that an entity should not consider the contractual sale restriction when measuring the equity security’s fair value and introduces new disclosure requirements related to such equity securities.
−Removed: The Company adopted this guidance effective January 1, 2024.
−Removed: This guidance did not impact the Company.
+Added: Improvements to Income Tax Disclosures - ASU 2023-09, Income Taxes (Topic 740):
+Added: Improvements to Income Tax Disclosures , focuses on improvements to income tax disclosures, primarily related to the rate reconciliation and income taxes paid information.
+Added: In addition, the update includes certain other amendments to improve the effectiveness of income tax disclosures.
+Added: The Company adopted this guidance prospectively, effective January 1, 2025.
+Added: The adoption of the new guidance did not have a material impact on its consolidated financial statements.
+Added: Refer to Note 9 “Income Taxes” for expanded disclosures related to effective tax rate and income taxes paid.
+Added: Derivatives and Hedging (Topic 815) - ASU 2025-09, Hedge Accounting Improvements:
+Added: Derivatives and Hedging, which provides targeted updates intended to simplify and improve the application of the hedge accounting.
+Added: This guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods with early adoption permitted.
+Added: The Company early adopted this guidance upon issuance in the fourth quarter of 2025.
+Added: The adoption did not currently impact the Company’s consolidated financial statements or related disclosures.
+Added: Refer to Note 7 “Debt” and Note 8 “Derivative Financial Instruments.”
+Added: Recently Issued
+Added: Interim Reporting - ASU 2025-11, Narrow-Scope Improvements (Topic 270):
+Added: Interim Reporting is intended to improve navigability of the required interim disclosures and clarify when the guidance is applicable.
+Added: The amendments also include additional guidance on what disclosures should be provided in interim reporting periods.
+Added: The amendment adds to Topic 270 a principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity.
+Added: This guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027.
+Added: Early adoption is permitted.
+Added: The Company is evaluating the impact of this guidance on its disclosures.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Recently Issued
+Added: Targeted Improvements to the Accounting for Internal-Use Software - ASU 2025-06, Intangibles — Goodwill and Other (Subtopic 350-40):
+Added: Targeted Improvements to the Accounting for Internal-Use Software , removes all references to prescriptive and sequential software development stages, requiring an entity to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended, as well as other evaluation and disclosure updates.
+Added: This guidance is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.
+Added: Early adoption is permitted as of the beginning of an annual reporting period.
+Added: The amendments in this ASU permit an entity to apply the new guidance using a prospective transition approach, a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption, and a retrospective transition approach.
+Added: The Company is currently evaluating the impact of this guidance on its financial statements and disclosures.
+Added: Measurement of Credit Losses for Accounts Receivable and Contract Assets - ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):
+Added: Measurement of Credit Losses for Accounts Receivable and Contract Assets, provides entities a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets, permitting the use of current conditions as of the balance sheet date when developing related forecasts and assumptions.
+Added: This guidance will be adopted effective January 1, 2026, and will be applied prospectively.
+Added: The adoption of the new guidance is not expected to have a material impact on its consolidated financial statements.
Disaggregation of Income Statement Expenses - ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40):
Disaggregation of Income Statement Expenses, requires additional disclosure in the footnotes at each interim and annual reporting period about specific types of expenses included in the expense captions presented on the face of the statement of operations as well as additional disclosures that also include information related to selling expenses.
−Removed: The guidance is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027.
+Added: The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.
The requirements will be applied prospectively with the option for retrospective application.
1 unchanged sentence
The Company is currently evaluating the impact of this guidance on its financial statements and disclosures.
−Removed: Improvements to Income Tax Disclosures - ASU 2023-09, Income Taxes (Topic 740):
−Removed: Improvements to Income Tax Disclosures , focuses on improvements to income tax disclosures, primarily related to the rate reconciliation and income taxes paid information.
−Removed: In addition, the update includes certain other amendments to improve the effectiveness of income tax disclosures.
−Removed: The guidance is effective for annual periods beginning after December 15, 2024, and should be applied prospectively, with retrospective application also permitted.
−Removed: Early adoption is permitted.
−Removed: The Company is currently evaluating the impact of this guidance on its financial statements and disclosures.
Disclosure Improvements - ASU 2023-06, Disclosure Improvements:
1 unchanged sentence
The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.
−Removed: The Company is currently evaluating the potential impact of this guidance on its financial statements and disclosures.
+Added: The Company is monitoring the potential impact of this guidance on its financial statements and disclosures.
Significant Accounting Policies
3 unchanged sentences
Restricted cash and restricted cash equivalents are restricted for a specific purpose and cannot be included in the general cash and cash equivalents account.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table reconciles the amounts below reported in the Consolidated Balance Sheets to the total of the same such amounts shown in the Consolidated Statements of Cash Flows:
3 unchanged sentences
Restricted cash and restricted cash equivalents (1)
+Added: 27,723 107,853 115,329
Ending balance $ 108,540 $ 204,065 $ 129,950
−Removed: Restricted cash and restricted cash equivalents primarily includes funds received from State Farm Fire & Casualty Company (“State Farm”) (the “Opportunity Fund”), net of payments and inclusive of interest earned, in connection with the State Farm Strategic Investment (as defined and discussed in Note 10 “Equity”).
−Removed: Amounts within the Opportunity Fund are restricted for certain qualifying spend in accordance with the development agreement between State Farm and the Company (the “State Farm Development Agreement”).
−Removed: Use of the funds must be agreed to by State Farm and the Company.
+Added: ___________________
+Added: (1) For 2 024 and 2023, restricted cash and restricted cash equivalents primarily included funds received from State Farm Fire & Casualty Company (“State Farm”) (the “Opportunity Fund”), net of payments and inclusive of interest earned, in connection with the State Farm Development Agreement (as defined and discussed in Note 10 “Equity” and Note 16 “Related Party Transactions”).
+Added: Use of the funds was restricted and agreed to by State Farm and the Company in accordance with the State Farm Development Agreement.
+Added: In October 2025, the Company repaid to State Farm $ 78 million of the Opportunity Fund in connection with the expiration of the State Farm Development Agreement.
The remaining amount of restricted cash relates to the Company’s uncommitted receivables securitization financing agreement (the “2020 Receivables Facility”) (refer to Note 7 “Debt”).
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Supplementary Cash Flow Information
5 unchanged sentences
Payments (refunds) on income taxes, net (2)
−Removed: Issuance of shares for acquisition of businesses (2)
$ 142,168 $ 21,700 $ 60,296
−Removed: Contingent forward purchase contract (3)
−Removed: $ — $ — $ 41,938
Forward share repurchase contract (3)
1 unchanged sentence
___________________
−Removed: (1) Includes finance leases and interest rate swaps.
−Removed: Refer to Note 8 “Derivative Financial Instruments.”
−Removed: (2) Includes $ 40 million related to the Delayed Shares (as defined and discussed in Note 10 “Equity”) as a result of the ADT Solar Acquisition.
−Removed: (3) The Company recorded a reduction to additional paid in capital as a result of the contingent forward purchase contract in connection with the Tender Offer (as defined and discussed in Note 10 “Equity”).
−Removed: (4) In December 2024, the Company entered into an agreement with a non-affiliate individual to repurchase 15 million shares of Common Stock at a price per share of $ 6.95 to be settled in January 2025 (refer to Note 10 “Equity”).
+Added: (1) Includes interest on finance leases (refer to Note 14 “Leases”) and interest rate swaps (refer to Note 8 “Derivative Financial Instruments”).
+Added: (2) Refer to Note 9 “Income Taxes” for disclosures on income taxes paid as a result of the adoption of ASU 2023-09, which the Company adopted on a prospective basis.
+Added: (3) In December 2024, the Company entered into an agreement with a non-affiliate individual to repurchase 15 million shares of Common Stock at a price per share of $ 6.95 , which settled in January 2025 (refer to Note 10 “Equity”).
The Company recorded a liability and a reduction to additional paid-in capital as of December 31, 2024.
−Removed: During 2024, the proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 704 million from amendments to the Company’s First Lien Credit Agreement (as defined and discussed in Note 7 “Debt”).
−Removed: In addition, proceeds and repayments of long-term borrowings include the impact of $ 32 million from amendments to the 2020 Receivables Facility.
−Removed: During 2023, the proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 230 million from the refinancing of the First Lien Term Loan B due 2026 with the First Lien Term Loan B due 2030 (as defined and discussed in Note 7 “Debt”).
+Added: During 2024, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 704 million from amendments to the Company’s First Lien Credit Agreement (as defined and discussed in Note 7 “Debt”) and $ 32 million from amendments to the 2020 Receivables Facility.
+Added: During 2023, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 230 million from the refinancing of the First Lien Term Loan B due 2026 with the First Lien Term Loan B due 2030 (as defined and discussed in Note 7 “Debt”).
Prepaid Expenses and Other Current Assets
5 unchanged sentences
38,264 56,164
+Added: Tax receivables
+Added: 73,201 15,962
Other current assets 57,110 66,287
Prepaid expenses and other current assets $ 250,325 $ 210,613
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Inventories, net
9 unchanged sentences
Repairs and maintenance expenditures are expensed when incurred.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Useful Lives:
8 unchanged sentences
Capitalized software (1)
+Added: 454,209 574,644
Machinery, equipment, and other (2)
+Added: 123,961 162,631
Construction in progress 31,734 22,106
2 unchanged sentences
Property and equipment, net $ 243,398 $ 247,183
+Added: _______________
+Added: (1) During 2025 includes approximately $ 266 million of retirements.
+Added: (2) During 2025 includes approximately $ 46 million of retirements.
Depreciation Expense:
2 unchanged sentences
Depreciation expense $ 185,989 $ 174,850 $ 176,407
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Subscriber System Assets, net and Deferred Subscriber Acquisition Costs, net
−Removed: Subscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system and are reflected in the Consolidated Balance Sheets as follows:
+Added: Subscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system, which the Company may retrieve upon termination of the contract with the customer.
+Added: Subscriber system assets are reflected in the Consolidated Balance Sheets as follows:
(in thousands) 2025 2024
4 unchanged sentences
The Company records subscriber system assets and deferred subscriber acquisition costs in the Consolidated Balance Sheets as these assets represent probable future economic benefits for the Company through the generation of future monitoring and related services revenue.
−Removed: Upon customer termination, the Company may retrieve its subscriber system assets.
−Removed: Subscriber system assets and any related deferred subscriber acquisition costs are accounted for on a pooled basis based on the month and year of customer acquisition and are depreciated and amortized using an accelerated method over the estimated life of the customer relationship, which is 15 years.
+Added: Subscriber system assets and any related deferred subscriber acquisition costs are accounted for on a pooled basis based on the month and year of customer acquisition and the Company depreciates and amortizes these pooled costs using an accelerated method over the estimated life of the customer relationship, which is 15 years.
In order to align the depreciation and amortization of these pooled costs to the pattern in which their economic benefits are consumed, the accelerated method utilizes an average declining balance rate of approximately 250 % and converts to straight-line methodology when the resulting charge is greater than that from the accelerated method, resulting in an average charge of approximately 55 % of the pool within the first five years, 25 % within the second five years, and 20 % within the final five years.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Depreciation of subscriber system assets and amortization of deferred subscriber acquisition costs are reflected in depreciation and intangible asset amortization and selling, general, and administrative expenses, respectively, as follows:
+Added: Depreciation of subscriber system assets and amortization of deferred subscriber acquisition costs are reflected in depreciation and intangible asset amortization and SG&A, respectively, as follows:
Years Ended December 31,
9 unchanged sentences
There were no material long-lived asset impairments during the periods presented.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Accrued Expenses and Other Current Liabilities
8 unchanged sentences
Advertising Costs
−Removed: Advertising costs are recognized in selling, general, and administrative expenses when incurred and were $ 105 million, $ 131 million, and $ 146 million during 2024, 2023, and 2022, respectively.
−Removed: Included in advertising costs during 2024 and 2023 are certain joint marketing costs and reimbursements associated with the Google Success Funds as discussed in Note 13 “Commitments and Contingencies.”
−Removed: Merger, Restructuring, Integration, and Other
−Removed: Merger, restructuring, integration, and other represents certain direct and incremental costs resulting from acquisitions made by the Company, integration and third-party costs as a result of those acquisitions, costs related to the Company’s restructuring efforts, as well as fair value remeasurements and impairment charges on certain strategic investments.
+Added: Advertising costs are recognized in SG&A expenses when incurred and were $ 98 million, $ 105 million, and $ 131 million during 2025, 2024, and 2023, respectively.
+Added: Included in advertising costs are certain joint marketing costs and reimbursements associated with the Google Success Funds (as defined and discussed in Note 13 “Commitments and Contingencies”).
Concentration of Credit Risks
3 unchanged sentences
Concentration of credit risk associated with the majority of the Company’s receivables from customers is limited due to the significant size of the customer base.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Fair Value of Financial Instruments
−Removed: The Company’s financial instruments primarily consist of cash and cash equivalents, restricted cash and restricted cash equivalents, accounts receivable, retail installment contract receivables (“RICs”), accounts payable, debt, and derivative financial instruments.
+Added: The Company’s financial instruments primarily consist of cash and cash equivalents, restricted cash and restricted cash equivalents, accounts receivable, retail installment contract receivables (“RICs”), accounts payable, debt, and derivatives.
Due to their short-term and/or liquid nature, the fair values of cash, restricted cash, accounts receivable, and accounts payable approximate their respective carrying amounts.
−Removed: Cash Equivalents - Included in cash and cash equivalents and restricted cash and restricted cash equivalents, as applicable from time to time, are investments in money market mutual funds.
+Added: Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents - Included in cash and cash equivalents and restricted cash and restricted cash equivalents, as applicable from time to time, are investments in money market mutual funds.
These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted prices in active markets for identical assets or liabilities.
1 unchanged sentence
Retail Installment Contract Receivables, net - The fair values of the Company’s RICs are determined using a discounted cash flow model and are classified as Level 3 fair value measurements.
+Added: Refer to Note 2 “Revenue and Receivables.”
(in thousands) Carrying
1 unchanged sentence
Retail installment contract receivables, net $ 651,811 $ 513,325 $ 669,326 $ 495,259
−Removed: Long-Term Debt Instruments - The fair values of the Company’s debt instruments are determined using broker-quoted market prices, which represent quoted prices for similar assets or liabilities as well as other observable market data, and are classified as Level 2 fair value measurements.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Long-Term Debt Instruments - The fair values of the Company’s long-term debt instruments are determined using broker-quoted market prices, which represent quoted prices for similar assets or liabilities as well as other observable market data, and are classified as Level 2 fair value measurements.
The carrying amounts of debt outstanding, if any, under the Company’s first lien revolving credit facility (the “First Lien Revolving Credit Facility”) and the 2020 Receivables Facility approximate their fair values, as interest rates on these borrowings approximate current market rates.
+Added: Refer to Note 7 “Debt.”
(in thousands) Carrying
Value Carrying
−Removed: Long-term debt instruments subject to fair value disclosures (1)
+Added: Long-term debt instruments (1) (see Note 7 “Debt”)
$ 7,641,869 $ 7,746,284 $ 7,637,631 $ 7,589,677
________________
−Removed: (1) Excludes finance leases and certain vehicle loans reported as discontinued operations.
−Removed: Derivative Financial Instruments - Derivative financial instruments are reported at fair value as either assets or liabilities.
−Removed: These fair values are primarily calculated using discounted cash flow models utilizing observable inputs, such as quoted forward interest rates, and incorporate credit risk adjustments to reflect the risk of default by the counterparty or the Company.
+Added: (1) Excludes finance leases.
+Added: Derivative Financial Instruments - Derivative financial instruments are reflected in the Consolidated Balance Sheet as either assets or liabilities at fair value that are primarily calculated using discounted cash flow models utilizing observable inputs, such as quoted forward interest rates, and incorporate credit risk adjustments to reflect the risk of default by the counterparty or the Company.
The resulting fair values are classified as Level 2 fair value measurements.
1 unchanged sentence
REVENUE AND RECEIVABLES
−Removed: The Company generates revenue through contractual monthly recurring fees received for monitoring and related services, as well as the sale and installation of security systems.
+Added: The Company generates revenue from contractual monthly recurring fees received for monitoring and related services, as well as the sale and installation of security systems.
+Added: The Company’s revenue-generating contracts are entered into primarily through its main operating entity and wholly-owned subsidiary, ADT LLC.
Revenue is recognized in the Consolidated Statements of Operations net of sales and other taxes.
1 unchanged sentence
When customers terminate a monitoring contract early, contract termination charges are assessed in accordance with the contract terms and are recognized in monitoring and related services revenue when collectability is probable.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Disaggregated Revenue
17 unchanged sentences
The Company’s performance obligations generally include monitoring, related services (such as maintenance agreements), as well as the sale and installation of a security system in outright sales transactions or a material right in transactions in which the Company retains ownership of the security system.
−Removed: Customer-Owned - In transactions involving security systems sold outright to the customer (referred to as outright sales ), the Company’s performance obligations generally include the sale and installation of the system, which is primarily recognized at a point in time based upon the nature of the transaction and contractual terms, and any monitoring and related services, which are recognized when these services are provided to the customer.
−Removed: Company-Owned - In transactions in which the Company provides monitoring and related services but retains ownership of the security system (referred to as Company-owned ), the Company’s performance obligations primarily include (i) monitoring and related services, which are recognized when these services are provided to the customer, and (ii) a material right associated with the one-time non-refundable fees incurred in connection with the initiation of a monitoring contract which the customer will not be required to pay again upon a renewal of the contract (referred to as deferred subscriber acquisition revenue).
−Removed: Deferred subscriber acquisition revenue is amortized on a pooled basis over the estimated life of the customer relationship using an accelerated method consistent with the treatment of subscriber system assets and deferred subscriber acquisition costs and is reflected in security installation, product, and other revenue.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Customer-Owned Transactions - In transactions involving security systems sold outright to the customer (referred to as outright sales ), the Company’s performance obligations generally include the sale and installation of the security system, which is primarily recognized at a point in time based upon the nature of the transaction and contractual terms, and any monitoring and related services, which are recognized when these services are provided to the customer.
+Added: Company-Owned Transactions - In transactions in which the Company provides monitoring and related services but retains ownership of the security system, the Company’s performance obligations primarily include (i) monitoring and related services, which are recognized when these services are provided to the customer, and (ii) a material right associated with the one-time non-refundable fees in connection with the initiation of a monitoring contract which the customer will not be required to pay again upon a renewal of the contract (referred to as deferred subscriber acquisition revenue).
+Added: Deferred subscriber acquisition revenue is amortized on a pooled basis over the estimated life of the customer relationship using an accelerated method consistent with the treatment of subscriber system assets and deferred subscriber acquisition costs.
Remaining Performance Obligations
−Removed: As of December 31, 2024, the remaining unsatisfied performance obligation relating to the provision of monitoring and related services is as follows (in thousands) :
+Added: As of December 31, 2025, the Company’s total remaining unsatisfied performance obligation relating to the provision of monitoring and related services is as follows (in thousands) :
Thereafter Total
4 unchanged sentences
These amounts are recorded as current deferred revenue, as the Company expects to satisfy any remaining performance obligations, as well as recognize the related revenue, within the next twelve months when performance obligations are satisfied.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Accounts Receivable
17 unchanged sentences
As such, write-offs are presented net of recoveries.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Retail Installment Contract Receivables, Net
The Company’s RICs allow qualifying residential customers to pay the fees due at installation over a 12-, 24-, 36-, or 60-month interest-free period.
−Removed: The financing component of retail installment contract receivables is not significant.
−Removed: Upon origination of a retail installment contract, the Company utilizes external credit scores to assess customer credit quality and determine eligibility.
−Removed: Subsequent to origination, the Company monitors the delinquency status of retail installment contract receivables as the key credit quality indicator.
−Removed: Delinquent billed RICs are not material.
+Added: The financing component is not significant.
The Company’s RICs are recorded at amortized cost less an allowance for credit losses not expected to be recovered.
The allowance for credit losses is recognized at inception and reassessed each reporting period.
−Removed: The allowance for credit losses relates to retail installment contract receivables from outright sales transactions and is not material.
+Added: The allowance for credit losses relates to RICs from outright sales transactions.
+Added: The following is a summary of unbilled retail installment contract receivables, net:
(in thousands) 2025 2024
6 unchanged sentences
Retail installment contract receivables, net $ 651,811 $ 669,326
−Removed: As discussed in Note 7 “Debt,” retail installment contract receivables, net, for which the Company grants a security interest as collateral for cash borrowings under the 2020 Receivables Facility were $ 575 million and $ 610 million, as of December 31, 2024 and 2023, respectively.
+Added: As of December 31, 2025 and 2024, RICs, net, for which the Company grants a security interest as collateral for borrowings under the 2020 Receivables Facility were $ 593 million and $ 575 million, respectively.
+Added: Refer to Note 7 “Debt” for further discussion regarding the 2020 Receivables Facility.
+Added: Credit Quality
+Added: Upon origination of a RIC, the Company assigns an internal credit grade derived from external credit data obtained from a nationally recognized credit reporting provider to evaluate customer credit quality and establish contract eligibility.
+Added: Subsequent to origination, the Company monitors the delinquency status of the RICs as the key credit quality indicator.
+Added: Delinquent billed RICs are not a material portion of the Company’s RICs.
+Added: The following table presents the gross amortized cost basis segregated by credit quality indicator and current year write-offs of the Company’s RICs by year of origination for the preceding five fiscal years as of December 31, 2025:
+Added: (in thousands)
+Added: 2025 2024 2023 2022 2021 All preceding years
+Added: $ 201,419 $ 122,031 $ 78,706 $ 45,519 $ 9,234 $ 1
+Added: 97,692 43,839 21,801 10,286 2,277 7
+Added: 31,684 14,341 6,664 2,870 652 —
+Added: $ 330,795 $ 180,211 $ 107,171 $ 58,675 $ 12,163 $ 8
+Added: Current year gross write-offs $ 10,770 $ 38,739 $ 16,598 $ 6,583 $ 1,965 $ 256
+Added: ________________
+Added: (1) Includes short-term receivables related to three-month payment plans.
Contract Assets
2 unchanged sentences
This balance is primarily comprised of satisfied performance obligations related to the sale and installation of a system under an outright sale transaction.
+Added: The Company has the right to bill customers as services are provided over time, which generally occurs over the course of a 12-, 24-, 36-, or 60-month period as additional services are performed and billed.
+Added: There is no significant financing component.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The Company has the right to bill customers as services are provided over time, which generally occurs over the course of a 24-, 36-, or 60-month period.
−Removed: There is no significant financing component.
The Company records an allowance for credit losses against its contract assets for amounts not expected to be recovered.
1 unchanged sentence
The allowance for credit losses on contract assets was not material for the periods presented.
−Removed: Gross contract assets recognized by the Company were not material for the periods presented.
(in thousands) 2025 2024
9 unchanged sentences
Contract assets, net $ 62,915 $ 40,810
+Added: The changes in the contract asset balance during 2025 and 2024 were not material.
+Added: Contract Liabilities
+Added: The Company’s primary contract liabilities are deferred subscriber acquisition revenue and deferred revenue as presented on the balance sheet.
+Added: Contract liabilities primarily represent amounts billed or collected in advance of the Company’s fulfillment of performance obligations under customer contracts.
+Added: Contract liabilities also include consideration received in advance for products or services that have not yet been transferred to the customer, including deferred revenue associated with the allocation of the transaction price to future performance obligations.
+Added: Contract liabilities are recognized as revenue when the related performance obligations are satisfied, which typically occurs over the term of the customer’s service agreement or upon completion of installation or product delivery.
+Added: During 2025 and 2024, customer contract liabilities increased by approximately $ 16 million and $ 149 million, respectively, primarily due to new billings and customer prepayments for monitoring, installation, and other subscription-based services.
+Added: Revenue recognized from the amounts included in the beginning contract liability balance totaled approximately $ 560 million and $ 478 million for the years ended December 31, 2025 and 2024, respectively.
+Added: Additional contract liabilities recognized during the years ended December 31, 2025 and 2024 were approximately $ 530 million and $ 640 million, respectively.
+Added: Other changes in the contract liabilities were not material.
SEGMENT INFORMATION
−Removed: As a result of the ADT Solar Exit and Commercial Divestiture, the Company reports results in a single operating and reportable segment, which reflects the continuing operations of the Company’s former CSB segment.
+Added: The Company reports results in a single operating and reportable segment.
The Company’s CODM is its Chairman, President, and Chief Executive Officer.
−Removed: The CODM evaluates performance and allocates resources on a consolidated basis using various measures primarily through reviews of various operational performance packages, earnings releases, investor presentations, and the Company’s SEC filings, as well as through the approval of the Company’s annual budget and forecast.
+Added: The CODM evaluates performance and allocates resources on a consolidated basis using various measures primarily through reviews of operational performance packages, earnings releases, investor presentations, and the Company’s SEC filings, as well as through the approval of the Company’s annual budget and forecast.
The Company’s reported segment profit measure is net income (loss) as this measure is most consistent with the amounts included in the Consolidated Statements of Operations.
1 unchanged sentence
The accounting policies of the Company’s reportable segment are the same as those of the Company.
−Removed: The following presents a reconciliation to the Company’s net income (loss) as reported in the Consolidated Statements of Operations and includes segment revenues, significant segment expenses that are regularly provided to or easily computed from information regularly provided to the CODM, other segment expenses, and adjustments to reconcile to net income (loss).
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The following presents a reconciliation to the Company’s net income (loss) as reported in the Consolidated Statements of Operations and includes segment revenues, significant segment expenses that are regularly provided to or easily computed from information regularly provided to the CODM, other segment expenses, and adjustments to reconcile to net income (loss).
Years Ended December 31,
40 unchanged sentences
________________
−Removed: (1) Included in monitoring and related services cost of revenue.
−Removed: (2) Included in SG&A.
−Removed: (3) Other segment items generally include other income and expenses and merger, restructuring, integration, and other charges as presented on the face of the Statements of Operations;
−Removed: as well as certain other items included in SG&A and interest income.
−Removed: Interest income is not material for all periods presented.
−Removed: (4) Represents activity related to the Commercial and Solar Businesses, which are presented as discontinued operations.
+Added: (1) Included in monitoring and related services cost of revenue in the Consolidated Statements of Operations.
+Added: (2) Included in SG&A in the Consolidated Statements of Operations.
+Added: (3) Other segment items generally include other income and expenses, interest income, and certain other items included in SG&A that are not considered significant segment expenses.
+Added: Interest income is not material for the periods presented.
+Added: (4) Represents activity related to the Commercial and Solar Businesses (as applicable during the periods), which are presented as discontinued operations.
Entity-Wide Disclosures
4 unchanged sentences
Refer to Note 2 “Revenue and Receivables” for further information on the Company’s products and services.
−Removed: The Company may decide to divest portions of its business for various reasons, including efforts to focus on its remaining businesses.
−Removed: The Company presents discontinued operations for components of the business that are either disposed of through
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: sale (or qualify as held for sale), abandonment, or spin-off if these actions also represent a strategic shift that has or will have a major effect on the Company’s financial results.
−Removed: Refer to Note 12 “Net Income (Loss) per Share” for basic and diluted earnings per share information associated with discontinued operations.
+Added: The Company may decide to divest portions of its business for various reasons, including efforts to focus on its remaining businesses.
+Added: The Company presents discontinued operations for components of the business that are either disposed of through sale (or qualify as held for sale), abandonment, or spin-off if these actions also represent a strategic shift that has or will have a major effect on the Company’s financial results.
+Added: Refer to Note 12 “Earnings per Share” for basic and diluted earnings per share information associated with discontinued operations.
ADT Solar Exit
3 unchanged sentences
Accordingly, the Solar Business is presented as a discontinued operation in the Company’s Consolidated Statements of Operations and Consolidated Balance Sheets for the periods presented.
−Removed: The Solar Business was previously reflected in the Solar reportable segment.
+Added: The Solar Business was reflected in the former Solar reportable segment.
+Added: Exit charges incurred and paid were not material in 2025.
During the year ended December 31, 2024, the Company incurred aggregate exit charges of $ 88 million, which have been recognized within income (loss) from discontinued operations, net of tax, related to (i) $ 33 million associated with the write-down and disposition of inventory and asset impairments, (ii) $ 29 million associated with the disposition of the existing installation pipeline, (iii) $ 13 million associated with employee separation costs, and (iv) $ 12 million associated with contract termination and other charges.
2 unchanged sentences
Balance Sheet Information
+Added: There were no material assets of discontinued operations as of December 31, 2025 and December 31, 2024.
(in thousands) December 31, 2025 December 31, 2024
−Removed: Accounts receivable, net $ — $ 20,270
−Removed: Inventories, net — 28,714
−Removed: Prepaid expenses and other current assets
−Removed: Total current assets of discontinued operations
−Removed: Property and equipment, net — 29,512
−Removed: Other assets — 13,767
−Removed: Total assets of discontinued operations
−Removed: $ — $ 104,236
Current maturities of long-term debt $ — $ 22
Accounts payable 2,804 6,953
−Removed: Deferred revenue — 9,177
Accrued expenses and other current liabilities 12,513 24,788
4 unchanged sentences
Total liabilities of discontinued operations $ 29,669 $ 47,652
−Removed: $ 47,652 $ 100,183
AND SUBSIDIARIES
1 unchanged sentence
Statements of Operations Information
+Added: There was no material activity related to discontinued operations within the Statement of Operations for the year ended December 31, 2025.
Years Ended December 31,
5 unchanged sentences
Depreciation and intangible asset amortization 1,898 15,496
−Removed: Merger, restructuring, integration, and other 34,000 23,213 7,292
Goodwill impairment
−Removed: — 511,176 200,974
Other (income) and expense items
−Removed: 1,481 2,235 1,197
Income (loss) from discontinued operations before income taxes ( 149,169 ) ( 670,910 )
2 unchanged sentences
Cash Flow Information
+Added: There was no material activity related to discontinued operations within the Statement of Cash Flows for the year ended December 31, 2025.
Years Ended December 31,
6 unchanged sentences
Commercial Divestiture
−Removed: On August 7, 2023, ADT, Iris Buyer LLC, a Delaware limited liability company and affiliate of GTCR LLC (“GTCR”), and, solely for certain purposes set forth in the Commercial Purchase Agreement (as defined below), Fire & Security Holdings, LLC (“F&S Holdings”), a Delaware limited liability company and an indirect, wholly-owned subsidiary of ADT, entered into an Equity Purchase Agreement (the “Commercial Purchase Agreement”) pursuant to which GTCR agreed to acquire all of the issued and outstanding equity interests of F&S Holdings, which directly or indirectly held all of the issued and outstanding equity interests in the subsidiaries of ADT that operated ADT’s commercial business (the “Commercial Business”) (the “Commercial Divestiture”).
−Removed: The Commercial Divestiture was completed on October 2, 2023, and the Company received net proceeds of approximately $ 1,585 million at the time of closing, subject to certain customary post-closing adjustments as set forth in the Commercial Purchase Agreement.
−Removed: In addition, the Company recognized a pre-tax gain on sale of approximately $ 630 million, which was recognized in income (loss) from discontinued operations during 2023.
−Removed: The Company used the majority of the net proceeds for debt redemption, as discussed in Note 7 “Debt.”
−Removed: Additionally, as the agreed upon sale price was substantially higher than the carrying value of the Commercial Business, the Company did not record any impairments or adjustments when recognizing the disposal group at the lower of its carrying amount or fair value less cost to sell.
+Added: On August 7, 2023, the Company entered into an Equity Purchase Agreement to sell substantially all of the issued and outstanding equity interests of its commercial business (the “Commercial Divestiture”).
+Added: On October 2, 2023, the Company completed the Commercial Divestiture for a purchase price of approximately $ 1.6 billion, subject to certain customary post-closing adjustments, and recognized a pre-tax gain on sale of approximately $ 630 million, which was recognized in income (loss) from discontinued operations during 2023.
During 2024, the Company paid GTCR $ 21 million related to the settlement of post-closing adjustments, which is presented in cash flows from investing activities.
1 unchanged sentence
Accordingly, the Commercial Business is presented as a discontinued operation in the Company’s Consolidated Statements of Operations for the periods presented.
+Added: The Commercial Business was previously reflected in the Commercial reportable segment.
+Added: Additionally, as the agreed upon sale price was substantially higher than the carrying value of the Commercial Business, the Company did not record any impairments or adjustments when recognizing the disposal group at the lower of its carrying amount or fair value less cost to sell.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The Commercial Business was previously reflected in the Commercial reportable segment.
The following reconciliations represent the major classes of line items of the Commercial Business within the Consolidated Statements of Operations and certain information within the Consolidated Statements of Cash Flows (excluding proceeds from the sale of business discussed above) for the periods presented.
Statements of Operations Information
+Added: During the year ended December 31, 2025, activity relating to the Commercial Divestiture was immaterial .
During the year ended December 31, 2024, activity, net of tax, relating to the Commercial Divestiture was approximately $ 8 million primarily related to the settlement of post-closing adjustments.
−Removed: Years Ended December 31,
+Added: Year Ended December 31,
(in thousands) 2023
1 unchanged sentence
Cost of revenue
−Removed: 688,433 839,356
Selling, general, and administrative expenses 213,514
2 unchanged sentences
Income (loss) from discontinued operations before gain on sale of business and income taxes
−Removed: 76,236 36,668
Gain on sale of business
Income (loss) from discontinued operations before income taxes
−Removed: 706,216 36,668
Income tax benefit (expense) ( 178,667 )
1 unchanged sentence
Cash Flow Information
−Removed: Years Ended December 31,
+Added: Year Ended December 31,
(in thousands) 2023
6 unchanged sentences
Transition Services Agreement
−Removed: In connection with the Commercial Divestiture, the Company entered into a Transition Services Agreement (the “Commercial TSA”), pursuant to which the Company and the Commercial Business will provide certain transitional services relating to ongoing support and other administrative functions to each other for a transitional period of up to 24 months after the closing of the Commercial Divestiture.
+Added: In connection with the Commercial Divestiture, the Company entered into a Transition Services Agreement (the “Commercial TSA”) for the provision of certain transitional services relating to ongoing support and other administrative functions to each other for a transitional period of up to 24 months after the closing of the Commercial Divestiture.
Commercial TSA fees charged to the Commercial Business represent charges for internal labor as well as certain third-party costs identified in connection with providing such services.
Income from the Commercial TSA is recognized in other income (expense), and expenses incurred by the Company to support the transition are recorded based on the nature of the expense.
+Added: During 2025 Commercial TSA income was not material.
During 2024 and 2023, the Company recognized income from the Commercial TSA of $ 40 million and $ 12 million, respectively.
4 unchanged sentences
The Company has also agreed to a covenant not to assert a claim against GTCR for infringement of the Company's patents as of the Commercial Divestiture for products and services that were used in the Commercial Business prior to the Commercial Divestiture, and has provided GTCR with a paid-up, irrevocable, non-assignable (with limited exceptions) license to continue to use certain software and other Company intellectual property in the same manner.
−Removed: Royalty income is included in other income (expense) and was not material during 2024 and 2023.
+Added: Royalty income is included in other income (expense) and is not material.
Other Divestitures
−Removed: During the periods presented, other divestiture activity not reflected as discontinued operations includes:
−Removed: During 2023, proceeds related to disposal activities totaled $ 36 million, resulting in a gain on sale of $ 19 million recognized in SG&A.
−Removed: During 2022, proceeds related to disposal activities totaled $ 27 million, resulting in a gain on sale of $ 10 million recognized in SG&A.
+Added: During 2025, the Company completed the sale of its multifamily business (the “Multifamily Divestiture”) for a purchase price of approximately $ 56 million, subject to certain customary post-closing adjustments.
+Added: The Company recorded $ 12 million of goodwill impairment , which is recognized in SG&A.
+Added: Any gain or loss on sale pursuant to customary post-closing adjustments is not expected to be material.
+Added: During 2023, proceeds related to disposal activities not reflected as discontinued operations totaled $ 36 million, resulting in a gain on sale of $ 19 million recognized in SG&A.
EQUITY METHOD INVESTMENTS
−Removed: The Company uses the equity method of accounting to account for an investment in which it has the ability to exercise significant influence but does not control.
−Removed: The Company recognizes its proportionate share of the investee’s net income or loss in equity in net earnings (losses) of equity method investee.
−Removed: The Company evaluates an equity method investment whenever events or changes in circumstances indicate the carrying amount of such investment may be impaired.
−Removed: If a decline in the value of an equity method investment is determined to be other than temporary, the Company records a loss as a component of the Company’s share of earnings or losses of the equity method investee in the current period.
Canopy Investment
1 unchanged sentence
Since the Initial Contribution, the Company contributed $ 7 million.
+Added: The Company accounted for its investment in Canopy under the equity method of accounting as the Company was not the primary beneficiary, and therefore, did not consolidate Canopy’s assets, liabilities, and financial results of operations.
During the fourth quarter of 2023, the Company sold its shares in Canopy and received $ 21 million in accordance with the terms of the agreement between the Company and Ford, which included a put right under which the Company recovered its full equity investment in Canopy plus a premium (“Canopy Termination”).
1 unchanged sentence
The Company no longer holds an investment in Canopy.
−Removed: The Company previously accounted for its investment in Canopy under the equity method of accounting as the Company was not the primary beneficiary, and therefore, did not consolidate Canopy’s assets, liabilities, and financial results of operations.
−Removed: In connection with the Canopy Investment, the Company entered into various commercial agreements (the “Canopy Commercial Agreements”), and the Company and Canopy are also parties to a trade name licensing agreement.
−Removed: These agreements terminated on December 1, 2024 as a result of the Canopy Termination.
−Removed: The impact to the consolidated financial statements from these agreements was not material.
GOODWILL AND OTHER INTANGIBLE ASSETS
−Removed: There were no changes in the carrying amount of goodwill for the periods presented.
−Removed: The previously reported accumulated goodwill impairment losses were associated with the Solar reporting unit, which is presented as a discontinued operation.
+Added: During the third quarter of 2025, the Company recorded a goodwill impairment charge of $ 12 million in connection with the Multifamily Divestiture, which is reflected in SG&A, and derecognized the remaining $ 6 million of goodwill upon completion of the divestiture on October 1, 2025.
+Added: Refer to Note 4 “Divestitures.”
+Added: The Company also had previously reported accumulated goodwill impairment losses that were associated with the Solar reporting unit, which is presented as a discontinued operation.
AND SUBSIDIARIES
19 unchanged sentences
__________________
−Removed: (1) During 2023, the Company retired $ 1.7 billion of certain customer relationship intangible assets acquired in the ADT Acquisition that became fully amortized.
(1) Originated from the Formation Transactions and the ADT Acquisition in 2015 and 2016, respectively.
5 unchanged sentences
Contracts and related customer relationships comprise contracts with customers purchased under the ADT Authorized Dealer Program (as defined below) or from other third parties as well as customer relationships that originated from business acquisitions.
−Removed: Additionally, the Company maintains a network of agreements with third-party independent alarm dealers who sell alarm equipment and ADT Authorized Dealer-branded monitoring and interactive services to residential end users (the “ADT Authorized Dealer Program”).
+Added: Additionally, the Company maintains a network of agreements with third-party independent dealers who sell alarm equipment and ADT Authorized Dealer-branded monitoring and interactive services to residential end users (the “ADT Authorized Dealer Program”).
The dealers in this program generate new end-user contracts with customers which the Company has the right, but not the obligation, to purchase from the dealer.
5 unchanged sentences
The accelerated method for amortizing these contracts utilizes an average declining balance rate of approximately 300 % and converts to straight-line methodology when the resulting amortization charge is greater than that from the accelerated method, resulting in an average amortization of approximately 65 % of the pool within the first five years, 25 % within the second five years, and 10 % within the final five years.
−Removed: Customer relationships acquired as part of business acquisitions, which primarily originated from the Formation Transactions and the ADT Acquisition, are amortized over a period of up to 15 years based on management estimates about the amounts and timing of estimated future revenue from customer accounts and average customer account life that existed at the time of the related business acquisition.
+Added: Customer relationships acquired as part of business acquisitions, which primarily originated from the Formation Transactions, are amortized over a period of up to 15 years based on management estimates about the amounts and timing of estimated future revenue from customer accounts and average customer account life that existed at the time of the related business acquisition.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The change in the net carrying amount of contracts and related customer relationships was as follows:
+Added: The change in the net carrying amount of contracts and related customer relationships during the period was as follows:
Years Ended December 31,
(in thousands) 2025 2024
−Removed: Beginning balance $ 2,634,211 $ 2,595,535
+Added: Balance as of December 31, 2024 $ 2,693,423 $ 2,634,211
Customer contract additions, net of dealer charge-backs 598,127 586,994
Amortization ( 548,988 ) ( 527,782 )
−Removed: Other — ( 300 )
−Removed: Ending balance $ 2,693,423 $ 2,634,211
−Removed: During 2024 and 2023, the weighted-average amortization period for customer contract additions under the ADT Authorized Dealer Program and from other third parties was 15 years.
−Removed: During 2024 and 2023, the Company purchased customer accounts from other third parties for an aggregate contractual purchase price of $ 98 million and $ 109 million, respectively, subject to reduction based on customer retention.
−Removed: The Company paid initial cash at the closings in the aggregate amounts of $ 81 million and $ 89 million, respectively, which is included in dealer generated customer accounts and bulk account purchases on the Consolidated Statements of Cash Flows.
+Added: Balance as of December 31, 2025 $ 2,742,562 $ 2,693,423
+Added: During 2025 and 2024, the weighted-average amortization period for customer contract additions under the ADT Authorized Dealer Program and from other third parties was approximately 15 years.
+Added: During 2025 and 2024, the Company completed multiple customer account purchases for an aggregate contractual purchase price of $ 132 million and $ 98 million, respectively, subject to reductions based on customer retention.
+Added: The Company paid total cash at the closings in the aggregate amounts of $ 115 million and $ 81 million, respectively, which is included in dealer generated customer accounts and bulk account purchases on the Consolidated Statements of Cash Flows.
Definite-Lived Intangible Asset Amortization Expense
16 unchanged sentences
In developing these assumptions, the Company relies on various factors including operating results, business plans, economic projections, anticipated future cash flows, and other market data.
−Removed: Examples of events or circumstances that could reasonably be expected to negatively affect the underlying judgments and factors and ultimately impact the estimated fair value determinations may include such items as a prolonged downturn in the business
+Added: Examples of events or circumstances that could reasonably be expected to negatively affect the underlying judgments and factors and ultimately impact the estimated fair value determinations may include such items as a prolonged downturn in the business environment, changes in economic conditions that significantly differ from the Company’s assumptions in timing or degree,
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: environment, changes in economic conditions that significantly differ from the Company’s assumptions in timing or degree, volatility in equity and debt markets resulting in higher discount rates, and unexpected regulatory changes.
+Added: volatility in equity and debt markets resulting in higher discount rates, and unexpected regulatory changes.
As a result, there are inherent uncertainties related to these judgments and factors that may ultimately impact the estimated fair value determinations.
−Removed: The Company performed a qualitative goodwill impairment test as of October 1, 2024.
−Removed: The Company concluded that it is more- likely-than-not that the fair value of the Company’s reporting unit exceeds its carrying value, and as a result, the Company did not perform a quantitative impairment test or record any goodwill impairment losses.
+Added: During the third quarter of 2025, the Company recorded a goodwill impairment charge of $ 12 million in connection with the Multifamily Divestiture, which is reflected in SG&A.
+Added: Refer to Note 4 “Divestitures.”
+Added: Additionally, the Company performed a qualitative goodwill impairment test as of October 1, 2025 on its single reporting unit.
+Added: The Company concluded that it is more- likely-than-not that the fair value of the Company’s reporting unit exceeds its carrying value, and as a result, the Company did not perform a quantitative impairment test or record any additional goodwill impairment losses.
The Company did not record any goodwill impairment losses in income/(loss) from continuing operations during 2024 and 2023.
−Removed: The Company previously recorded goodwill impairment charges associated with the Solar reporting unit which are now presented in income (loss) from discontinued operations, net of tax.
+Added: The Company’s previously recorded goodwill impairment charges associated with the Solar reporting unit are presented in income (loss) from discontinued operations, net of tax.
Indefinite-Lived Intangible Assets
17 unchanged sentences
Debt Description Issued Maturity Interest Rate (1)
−Removed: First Lien Term Loan B due 2030 10/13/2023 10/13/2030 Term SOFR +2.00% Quarterly $ 1,984,090 $ 1,375,000
−Removed: First Lien Revolving Credit Facility 3/16/2018 10/1/2029 Term SOFR +2.00% Quarterly — —
−Removed: Term Loan A Facility 3/14/2023 3/14/2028 Term SOFR +2.25% Quarterly — 625,625
+Added: First Lien Term Loan B due 2030 10/13/2023 10/13/2030 Term SOFR + 2.00 %
+Added: Quarterly $ 1,764,249 $ 1,984,090
+Added: First Lien Term Loan B-2 due 2032
+Added: 3/7/2025 3/7/2032 Term SOFR + 1.75 %
+Added: Quarterly 1,441,989 —
+Added: First Lien Revolving Credit Facility 3/16/2018 10/1/2029 Term SOFR + 2.00 %
+Added: Quarterly — —
+Added: First Lien Term Loan A due 2030 10/28/2025 10/28/2030 Term SOFR + 1.50 %
+Added: Quarterly 325,000 —
First Lien Notes due 2026 4/4/2019 4/15/2026 5.750 % 3/15 and 9/15 75,000 1,350,000
11 unchanged sentences
Unamortized debt discount, net
+Added: ( 30,579 ) ( 12,081 )
Unamortized deferred financing costs
+Added: ( 22,949 ) ( 26,990 )
Unamortized purchase accounting fair value adjustment and other
+Added: ( 103,811 ) ( 115,201 )
Total debt 7,689,634 7,707,073
3 unchanged sentences
(1) Interest rate as of December 31, 2025 .
−Removed: Interest on the 2020 Receivables Facility is primarily based on the Secured Overnight Financing Rate (“SOFR”) + 1.05 % and Cost of Funds (“COF”) + 0.95 %.
+Added: I nterest on the 2020 Receivables Facility is primarily based on the Secured Overnight Financing Rate (“SOFR”) + 0.95 % and Cost of Funds (“COF”) + 0.85 %.
(2) Maturity date for the 2020 Receivables Facility represents the final maturity of date of current loans borrowed under the facility.
1 unchanged sentence
First Lien Credit Agreement
−Removed: The Company’s first lien credit agreement dated as of July 1, 2015 (together with subsequent amendments and restatements, the “First Lien Credit Agreement”) includes a term loan (the “First Lien Term Loan B due 2030”) and a revolving credit facility (the “First Lien Revolving Credit Facility”).
+Added: The Company’s first lien credit agreement dated as of July 1, 2015 (together with subsequent amendments and restatements, the “First Lien Credit Agreement”) provides for term loans (the “First Lien Term Loan B due 2030” and the “First Lien Term Loan B-2 due 2032,” together, the “First Lien Term Loan Bs”) and a revolving credit facility (the “First Lien Revolving Credit Facility”).
Prime Security Services Holdings, LLC (“Holdings”), a Delaware limited liability company and a wholly owned indirect subsidiary of the Company, Prime Security Services Borrower, LLC (“Prime Borrower”), a Delaware limited liability company and a wholly owned direct subsidiary of Holdings, and The ADT Corporation, a Delaware corporation and a wholly owned direct subsidiary of Prime Borrower (together with Prime Borrower, the “Borrowers”), are parties to the First Lien Credit Agreement as holdings and borrowers respectively.
−Removed: The First Lien Term Loan B due 2030 requires scheduled quarterly amortization payments equal to 0.25 % of its outstanding principal amount at the time of the December 2024 amendment, with the remaining balance payable at maturity.
+Added: Indebtedness incurred under the First Lien Credit Agreement is guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and is secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case, subject to certain permitted liens and exceptions.
+Added: The First Lien Term Loan B due 2030
+Added: The First Lien Term Loan B due 2030 requires scheduled quarterly amortization payments equal to 0.25 % of its outstanding principal amount at the time of the December 2024 amendment (discussed below), with the remaining balance payable at maturity.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Borrowers may make voluntary prepayments on the First Lien Term Loan B due 2030 at any time prior to maturity at par, subject to a 1.00 % prepayment premium in the event of certain specified refinancing events at any time before June 2025.
1 unchanged sentence
As of December 31, 2025, the Borrowers were not required to make an annual prepayment based on the Company’s excess cash flow.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The First Lien Term Loan B due 2030 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a term SOFR rate (“Term SOFR”) with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50 % per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the one-month adjusted term SOFR plus 1.00 % per annum (“Base Rate”), in each case, plus an applicable margin of 2.00 % per annum for Term SOFR loans and 1.00 % per annum for Base Rate loans.
Prime Borrower has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan B due 2030.
+Added: The First Lien Term Loan B-2 due 2032
+Added: The First Lien Term Loan B-2 due 2032 requires scheduled quarterly amortization payments equal to 0.25 % of its original principal amount with the remaining balance payable at maturity.
+Added: The Borrowers may make voluntary prepayments on the First Lien Term Loan B-2 due 2032 at any time prior to maturity at par, subject to a 1.00 % prepayment premium in the event of certain specified refinancing events during the first six months after the most recent amendment.
+Added: The First Lien Term Loan B-2 due 2032 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a term SOFR rate with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50 % per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the Base Rate, in each case, plus an applicable margin of 1.75 % per annum for Term SOFR loans and 0.75 % per annum for Base Rate loans.
+Added: Prime Borrower has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan B-2 due 2032.
+Added: The First Lien Term Loan B-2 due 2032 is subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness of Prime Security Services Borrower, LLC and its subsidiaries if, on such date, the aggregate principal amount of such indebtedness equals or exceeds $ 1 billion.
+Added: Loans under the First Lien Term Loan B-2 due 2032 are treated as a separate class from the existing loans under the First Lien Term Loan B due 2030.
+Added: First Lien Revolving Credit Facility
The applicable margin for borrowings under the First Lien Revolving Credit Facility is 2.00 % for Term SOFR loans (subject to a credit spread adjustment) and 1.00 % for Base Rate loans, in each case, subject to adjustment pursuant to a leverage-based pricing grid, subject to two step downs to 1.75 % and 1.50 % based on a net first lien leverage ratio of 2.00 to 1.00 and 1.50 to 1.00, respectively.
1 unchanged sentence
The First Lien Revolving Credit Facility is also subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness if, as of such date, the outstanding principal amount of such indebtedness exceeds $ 350 million.
−Removed: Indebtedness incurred under the First Lien Credit Agreement is guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and is secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case, subject to certain permitted liens and exceptions.
+Added: The aggregate amount of commitments under the First Lien Revolving Credit Facility is $ 800 million.
+Added: As of December 31, 2025, the Company had $ 800 million in available borrowing capacity under the First Lien Revolving Credit Facility.
+Added: Significant Activity
Significant amendments and restatements related to the First Lien Credit Agreement during the periods presented were as follows:
−Removed: • October 2023 - The Company redeemed approximately $ 1.3 billion of the then existing term loan (the “First Lien Term Loan B due 2026”) using net proceeds from the Commercial Divestiture.
−Removed: • October 2023 - The Company amended and restated the First Lien Credit Agreement and refinanced the remaining outstanding balance of the First Lien Term Loan B due 2026 with a new $ 1,375 million 7 -year First Lien Term Loan B due 2030.
+Added: • October 2023 - The Company redeemed approximately $ 1.3 billion of the then outstanding term loan due 2026 (the “First Lien Term Loan B due 2026”) using net proceeds from the Commercial Divestiture.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: • October 2023 - The Company amended and restated the First Lien Credit Agreement and refinanced the remaining outstanding balance of the First Lien Term Loan B due 2026 with a new $ 1.375 billion 7-year First Lien Term Loan B due 2030.
• April 2024 - The Company amended and restated the First Lien Credit Agreement, which reduced the interest rate on the First Lien Term Loan B due 2030 from Term SOFR + 2.50 % to Term SOFR + 2.25 %.
−Removed: • May 2024 - The Company amended and restated the First Lien Credit Agreement, which included the exchange of $ 143 million principal amount of loans under the Company’s Term Loan A Facility for its First Lien Term Loan B due 2030.
−Removed: In addition, later that month, the Company further amended and restated the First Lien Credit Agreement, pursuant to which the Company incurred an additional $ 474 million of outstanding principal under the First Lien Term Loan B due 2030 with the proceeds used to pay off the remaining outstanding balance of the Company’s Term Loan A Facility.
+Added: • May 2024 - The Company amended and restated the First Lien Credit Agreement, which included the exchange of $ 143 million principal amount of loans under the Company’s then outstanding Term Loan A Facility due 2028 for its First Lien Term Loan B due 2030.
+Added: In addition, later that month, the Company further amended and restated the First Lien Credit Agreement, pursuant to which the Company incurred an additional $ 474 million of outstanding principal under the First Lien Term Loan B due 2030 with the proceeds used to pay off the remaining outstanding balance of the Company’s then outstanding Term Loan A Facility due 2028.
• October 2024 - The Company amended and restated the First Lien Credit Agreement to extend the maturity date of the First Lien Revolving Credit Facility to October 2029 and obtain an additional $ 225 million of First Lien Revolving Credit Facility commitments.
After giving effect to the amendment, the aggregate amount of commitments under the First Lien Revolving Credit Facility is $ 800 million.
−Removed: In addition, the amendment reduced the commitment fee in respect of the First Lien Revolving Credit Facility to 0.20 % to 0.30 % per annum in respect of the unutilized commitments thereunder, subject to two step-downs based on certain specified net first lien leverage ratios.
+Added: In addition, the amendment reduced the commitment fee in respect of the First Lien Revolving Credit Facility to 0.30 % per annum in respect of the unutilized commitments thereunder, subject to two step-downs based on certain specified net first lien leverage ratios.
• December 2024 - The Company amended and restated the First Lien Credit Agreement, which reduced the interest rate on the First Lien Term Loan B due 2030 from Term SOFR + 2.25 % to Term SOFR + 2.00 %.
−Removed: During 2024, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 704 million from certain of the 2024 amendments described above.
−Removed: During 2023, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 230 million from the October 2023 amendment described above.
−Removed: In addition, debt issuance costs, loss on extinguishment of debt, and financing and consent fees were not material as a result of these amendments.
−Removed: Subsequent event - On February 7, 2025, the Company issued a notice of partial redemption for $ 500 million of the First Lien Notes due 2026, which will be redeemed on March 9, 2025.
−Removed: Prior to the issuance of such notice, certain lenders provided
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: commitments that they will fund a new $ 600 million first lien seven -year term loan facility.
−Removed: The closing of this new facility, which remains subject to market and other customary conditions, is expected to occur on or around March 7, 2025.
−Removed: The Company intends to use proceeds of this new facility for the partial redemption of the First Lien Notes due 2026 among other general corporate purposes.
−Removed: First Lien Revolving Credit Facility
−Removed: As discussed above, during 2024, the Company extended the maturity date of the First Lien Revolving Credit Facility to October 2029, subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness if, as of such date, the outstanding principal amount of such indebtedness exceeds $ 350 million, and obtained an additional $ 225 million of First Lien Revolving Credit Facility commitments.
−Removed: After giving effect to the amendment, the aggregate amount of commitments under the First Lien Revolving Credit Facility is $ 800 million.
+Added: • March 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of a new $ 600 million First Lien Term Loan B-2 due 2032, and received net proceeds of $ 597 million.
+Added: The Company used the net proceeds to redeem $ 500 million of the First Lien Notes due 2026.
+Added: • July 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $ 550 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $ 545 million.
+Added: These incremental borrowings have the same terms as existing loans under the First Lien Term Loan B-2 due 2032.
+Added: The Company used the net proceeds and cash on hand to redeem $ 550 million of the First Lien Notes due 2026.
+Added: • October 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $ 300 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $ 297 million.
+Added: The Company used the net proceeds to partially redeem the Second Lien Notes due 2028.
+Added: • October 2025 - The Company redeemed $ 200 million of the First Lien Term Loan B due 2030 using proceeds from the First Lien Term Loan A due 2030.
+Added: During 2024 and 2023, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $ 704 million and $ 230 million, respectively, from certain of the amendments described above.
Significant borrowings and repayments under the First Lien Revolving Credit Facility during the periods presented were as follows:
+Added: There were no borrowings or repayments.
The Company borrowed $ 365 million and repaid $ 365 million.
The Company borrowed $ 198 million and repaid $ 198 million.
−Removed: As of December 31, 2024, the Company had $ 800 million in available borrowing capacity under the First Lien Revolving Credit Facility.
−Removed: Term Loan A Facility
−Removed: On March 14, 2023, Holdings, Prime Borrower, and The ADT Corporation (Prime Borrower and The ADT Corporation in such capacity, the “Term Loan A Borrowers”), entered into a term loan credit agreement (the “Term Loan A Credit Agreement”) with Barclays Bank PLC, as administrative agent, and the lenders party thereto, pursuant to which such lenders provided the Term Loan A Borrowers with an aggregate principal amount of $ 600 million of term loans (the “Closing Date Term Loan A Loans”) under a senior secured term loan A facility (the “Term Loan A Facility”).
−Removed: The Company used the proceeds from the Closing Date Term Loan A Loans to redeem $ 600 million outstanding principal amount of the Company’s 4.125 % senior notes due June 15, 2023 (the “ADT Notes due 2023”).
−Removed: Also on March 14, 2023, Holdings, the Term Loan A Borrowers, the subsidiary loan parties thereto, Barclays Bank PLC, and the lender party thereto entered into an amendment to the Term Loan A Credit Agreement, pursuant to which the lender party thereto agreed, at the option of the Term Loan A Borrowers and subject to the satisfaction or waiver of customary conditions, to provide the Term Loan A Borrowers with an aggregate principal amount of $ 50 million of incremental term loans (the “Incremental Term Loan A Loans”) under the Term Loan A Facility on or before the scheduled maturity date of the ADT Notes due 2023.
−Removed: On June 15, 2023, the Company borrowed the Incremental Term Loan A Loans and used the proceeds to complete the redemption of $ 50 million of the ADT Notes due 2023.
−Removed: The Incremental Term Loan A Loans have the same terms as, and constitute one class with, the Closing Date Term Loan A Loans.
−Removed: In May 2024, the Company exchanged $ 143 million of loans under its Term Loan A Facility for its First Lien Term Loan B due 2030, as discussed above.
−Removed: In addition, later that month, the Company redeemed the remaining outstanding principal balance of $ 474 million of its Term Loan A Facility, excluding accrued and unpaid interest, using proceeds under the First Lien Term Loan B due 2030, as discussed above.
−Removed: As a result, the Term Loan A Facility has been terminated.
+Added: First Lien Term Loan A due 2030
+Added: On October 28, 2025, the Company entered into a term loan credit agreement (together with subsequent amendments and restatements, the “Term Loan Credit Agreement”) for an aggregate principal amount of $ 325 million of term loans under a senior secured term loan A facility (the “First Lien Term Loan A due 2030”).
+Added: The Company used the proceeds for general corporate purposes and to redeem $ 200 million of the First Lien Term Loan B due 2030.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The First Lien Term Loan A due 2030 requires scheduled amortization payments, commencing on March 31, 2026, in annual amounts equal to (a) prior to March 31, 2028, 2.5 % of its original principal amount and (b) on or after March 31, 2028, 5.0 % of its original principal amount, payable quarterly, with the balance payable at maturity.
+Added: The Company may make voluntary prepayments of the First Lien Term Loan A due 2030 at any time prior to maturity at par.
+Added: The First Lien Term Loan A due 2030 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a Term SOFR rate with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50 % per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the one-month adjusted term SOFR plus 1.00 % per annum, in each case, plus an applicable margin of 1.50 % per annum for Term SOFR loans and 0.50 % per annum for Base Rate loans, subject to adjustments based on certain specified net first lien leverage ratios.
+Added: The Company has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan A due 2030.
+Added: Indebtedness incurred under the Term Loan Credit Agreement is guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and is secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case subject to certain permitted liens and exceptions.
+Added: Additionally, the Term Loan Credit Agreement includes customary mandatory prepayment provisions, covenants and restrictions, including a financial maintenance covenant requiring the Borrowers to comply as of the last day of each fiscal quarter, beginning with the fiscal quarter ending March 31, 2026, with a specified maximum consolidated net first lien leverage ratio.
First Lien Notes due 2024
8 unchanged sentences
The indenture governing the First Lien Notes due 2026 also provides for customary events of default.
−Removed: As discussed above, on February 7, 2025, the Company issued a notice of partial redemption for $ 500 million of the First Lien Notes due 2026, which will be redeemed on March 9, 2025.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: As discussed above, partial redemptions of the First Lien Notes due 2026 were as follows:
+Added: • March 2025 - The Company redeemed $ 500 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $ 506 million, which includes a make-whole payment, using proceeds from the Company’s March 2025 issuance of the First Lien Term Loan B-2 due 2032.
+Added: • July 2025 - The Company redeemed $ 550 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $ 554 million, which includes a make-whole payment, using proceeds from the Company’s July 2025 issuance of the First Lien Term Loan B-2 due 2032 and cash on hand.
+Added: • December 2025 - The Company redeemed $ 225 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $ 226 million, which includes a make-whole payment, using cash on hand.
First Lien Notes due 2027
8 unchanged sentences
In July 2021, the Company issued $ 1.0 billion aggregate principal amount of 4.125 % first-priority senior secured notes due 2029 (the “First Lien Notes due 2029”).
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The First Lien Notes due 2029 will mature on August 1, 2029, with semi-annual interest payment dates of February 1 and August 1 of each year, beginning February 1, 2022, and may be redeemed at the Company’s option as follows:
4 unchanged sentences
The indenture governing the First Lien Notes due 2029 also provides for customary events of default.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: First Lien Notes due 2033
+Added: In October 2025, the Company issued $ 1.0 billion aggregate principal amount of 5.875 % first-priority senior secured notes due 2033 (the “First Lien Notes due 2033”).
+Added: The First Lien Notes due 2033 will mature on October 15, 2033, with semi-annual interest payment dates of January 15 and July 15 of each year, beginning January 15, 2026, and may be redeemed at the Company’s option as follows:
+Added: • Prior to October 15, 2032, in whole at any time or in part from time to time, at a redemption price equal to the greater of (i) 100 % of the principal amount of the First Lien Notes due 2033 to be redeemed and (ii) the sum of the present values of the aggregate principal amount of the First Lien Notes due 2033 to be redeemed and the remaining scheduled interest payments due on any date after the redemption date, to and including October 15, 2032, discounted at an adjusted treasury rate plus 50 basis points, plus, in either case accrued and unpaid interest as of, but excluding, the redemption date.
+Added: • On or after October 15, 2032, in whole at any time or in part from time to time, at a redemption price equal to 100 % of the principal amount of the First Lien Notes due 2033 to be redeemed and accrued and unpaid interest as of, but excluding, the redemption date.
+Added: The Company’s obligations relating to the First Lien Notes due 2033 are guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Company’s subsidiaries and are secured by first-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions.
+Added: Upon the occurrence of specified change of control events, the Company may be required to purchase the notes at 101 % of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date.
+Added: The indenture governing the First Lien Notes due 2033 also provides for customary events of default.
Second Lien Notes due 2028
−Removed: The Company’s 6.250 % second-priority senior secured notes due 2028 (the “Second Lien Notes due 2028”) are due at maturity, and since January 15, 2023, the Second Lien Notes due 2028 may be redeemed at the Company’s option in whole at any time or in part from time to time, at a redemption price equal to 100 % (as of January 15, 2025) of the principal amount of the Second Lien Notes due 2028 redeemed and accrued and unpaid interest as of, but excluding, the redemption date.
−Removed: The Company’s obligations relating to the Second Lien Notes due 2028 are guaranteed, jointly and severally, on a senior secured second-priority basis, by substantially all of the Company’s domestic subsidiaries and are secured by second-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions.
−Removed: Additionally, upon the occurrence of specified change of control events, the Company must offer to repurchase the Second Lien Notes due 2028 at 101 % of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date.
−Removed: The indenture governing the Second Lien Notes due 2028 also provides for customary events of default.
+Added: In October 2025, the Company redeemed its 6.250 % second-priority senior secured notes due 2028 (the “Second Lien Notes due 2028”) at par using proceeds from the First Lien Notes due 2033, incremental borrowings under the First Lien Term Loan B-2 due 2032, and cash on hand.
In connection with the ADT Acquisition, the Company entered into supplemental indentures to notes originally issued by The ADT Corporation (collectively, the “ADT Notes”) providing for each series of ADT Notes to benefit from (i) guarantees by substantially all of the Company’s domestic subsidiaries and (ii) first-priority senior security interests, subject to permitted liens, in substantially all of the existing and future assets of the Company’s domestic subsidiaries.
As a result, these notes remained outstanding and became obligations of the Company.
−Removed: During 2023, the Company redeemed the then-outstanding ADT Notes due 2023.
−Removed: The remaining outstanding ADT Notes are due at maturity, and may be redeemed, in whole at any time or in part from time to time, at a redemption price equal to the principal amount of the notes to be redeemed, plus a make-whole premium, plus accrued and unpaid interest as of, but excluding, the redemption date.
+Added: The outstanding ADT Notes are due at maturity, and may be redeemed, in whole at any time or in part from time to time, at a redemption price equal to the principal amount of the notes to be redeemed, plus a make-whole premium, plus accrued and unpaid interest as of, but excluding, the redemption date.
Additionally, upon the occurrence of specified change of control events, the Company must offer to repurchase the ADT Notes at 101 % of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date.
2 unchanged sentences
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Significant activity related to the ADT Notes due 2023 during the periods presented was as follows:
−Removed: • March 2023 - The Company redeemed $ 600 million outstanding principal amount for a total redemption price of $ 600 million, excluding any accrued and unpaid interest, using the proceeds from the Closing Date Term Loan A Loans.
−Removed: • June 2023 - The Company redeemed the remaining outstanding principal amount of $ 100 million for a total redemption price of $ 100 million, excluding any accrued and unpaid interest, using $ 50 million of proceeds from the Incremental Term Loan A Loans and the remaining from cash on hand.
2020 Receivables Facility
5 unchanged sentences
Significant amendments to the 2020 Receivables Facility during the periods presented were as follows:
−Removed: • May 2022 - Changed the benchmark rate from 1-month LIBOR to Daily SOFR, extended the scheduled termination date for the uncommitted revolving period from October 2022 to May 2023, and amended certain other terms to increase the advance rate on pledged collateral.
−Removed: • March 2023 - Increased the borrowing capacity from $ 400 million to $ 500 million and extended the uncommitted revolving period from May 2023 to March 2024, among other things.
−Removed: • March 2024 - The Company amended the agreement governing the 2020 Receivables Facility, pursuant to which the uncommitted revolving period was extended from March 2024 to April 2024.
−Removed: • April 2024 - The Company further amended the agreement governing the 2020 Receivables Facility, pursuant to which, among other things, the borrowing capacity was increased from $ 500 million to $ 550 million and the uncommitted revolving period was extended from April 2024 to April 2025.
−Removed: In addition, proceeds and repayments from the receivables facility include the impact of $ 32 million from the amendments described above.
+Added: • March 2023 - The borrowing capacity was increased from $ 400 million to $ 500 million and the uncommitted revolving period was extended from May 2023 to March 2024, among other things.
+Added: • March 2024 - The uncommitted revolving period was extended from March 2024 to April 2024.
+Added: • April 2024 - The borrowing capacity was increased from $ 500 million to $ 550 million and the uncommitted revolving period was extended from April 2024 to April 2025, among other things.
+Added: In addition, proceeds and repayments from the receivables facility during 2024 include the impact of $ 32 million from these amendments.
+Added: • March 2025 - The uncommitted revolving period was extended to March 2026, the interest rate on outstanding borrowings was reduced, and the advance rate on pledged collateral was increased.
The Company services the transferred retail installment contract receivables and is responsible for ensuring the related collections are remitted to a segregated bank account in the SPE’s name.
4 unchanged sentences
As of December 31, 2025, the Company had an uncommitted available borrowing capacity under the 2020 Receivables Facility of $ 107 million.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Variable Interest Entity
2 unchanged sentences
As of December 31, 2025 and 2024, the SPE’s assets and liabilities primarily consisted of a portion of the Company’s unbilled retail installment contract receivables, net, of $ 593 million and $ 575 million, respectively, and borrowings under the 2020 Receivables Facility as presented above.
−Removed: Solar Receivables Facility
−Removed: On August 2, 2023, Compass Solar Group, LLC (“Compass”) and ADT Solar Finance LLC (“ADT Solar Finance”), each an indirect wholly-owned subsidiary of ADT Inc.
−Removed: entered into a Receivables Financing Agreement with Mizuho Bank, Ltd.
−Removed: (the “Solar Receivables Financing Agreement”) to finance receivables generated by the installation of residential solar systems.
−Removed: Prior to its expiration in August 2024, the Solar Receivables Financing Agreement, among other things, provided for an uncommitted revolving loan facility in the aggregate principal amount of up to $ 300 million which loans were to be secured by substantially all the assets of ADT Solar Finance (the “Solar Receivables Facility”).
−Removed: The Company did not borrow any amounts under the Solar Receivables Facility prior to its expiration.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Debt Covenants
−Removed: Our credit agreements and indentures associated with the borrowings above contain certain covenants and restrictions that limit the Company’s ability to, among other things:
+Added: The Company’s credit agreements and indentures associated with the borrowings above contain certain covenants and restrictions that limit the Company’s ability to, among other things:
(a) incur additional debt or issue certain preferred equity interests;
9 unchanged sentences
and (k) modify the terms of certain debt or organizational agreements.
−Removed: Our credit agreements and indentures associated with the borrowings above also provide for customary events of default.
+Added: The Company’s credit agreements and indentures associated with the borrowings above also provide for customary events of default.
The Company is subject to a springing financial maintenance covenant under the First Lien Credit Agreement, which requires the Company to not exceed a specified first lien leverage ratio at the end of each fiscal quarter if the testing conditions are satisfied.
3 unchanged sentences
Loss on extinguishment of debt includes the payment of call and redemption premiums, the write-off of unamortized deferred financing costs and discounts, and certain other expenses associated with extinguishment of debt.
−Removed: During the periods presented, significant activity related to loss on extinguishment of debt was as follows:
−Removed: Totaled $ 17 million and was primarily due to the write-off of unamortized discount and debt issuance costs associated with the partial redemption of the First Lien Term Loan B due 2026 and the refinancing of the First Lien Term Loan B due 2026.
−Removed: Additional fees and other costs associated with financing transactions were not material during 2024, 2023, or 2022.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Loss on extinguishment of debt was $ 19 million, $ 5 million, and $ 17 million during 2025, 2024, and 2023, respectively.
+Added: Additional fees and other costs associated with financing transactions were not material during the periods presented.
As of December 31, 2025, the aggregate annual maturities of debt, excluding finance leases, were as follows:
3 unchanged sentences
DERIVATIVE FINANCIAL INSTRUMENTS
−Removed: The Company's derivative financial instruments primarily consist of SOFR-based interest rate swap contracts, which were entered into with the objective of managing exposure to variability in interest rates on the Company's debt and interest rate swaps.
−Removed: All interest rate swap contracts are reported in the Consolidated Balance Sheets at fair value.
+Added: The Company's derivative financial instruments primarily consist of interest rate swap contracts, which were entered into with the objective of managing exposure to variability in interest rates on the Company’s variable rate debt.
+Added: SOFR is the applicable benchmark for all of the Company’s interest rate swap contracts.
+Added: All interest rate swap contracts are reported at fair value in the Consolidated Balance Sheets.
+Added: Derivative instruments designated as cash flow hedges were highly effective at inception and are expected to continue to be highly effective.
For interest rate swap contracts that are:
• Not designated as cash flow hedges:
−Removed: Unrealized gains and losses are recognized in interest expense, net, and other income (expense) depending on the nature of the underlying that the swaps are economically hedging.
+Added: Unrealized gains and losses are recognized in interest expense, net, and other income (expense) depending on the nature of the underlying.
• Designated as cash flow hedges:
Unrealized gains and losses are recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into interest expense, net, in the same period in which the related interest on debt affects earnings.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For interest rate swap contracts that have been de-designated as cash flow hedges and for which forecasted cash flows are:
3 unchanged sentences
Unrealized gains and losses previously recognized as a component of AOCI are immediately reclassified into interest expense, net.
−Removed: The cash flows associated with interest rate swap contracts that contain an other-than-insignificant financing element at inception are reflected as cash flows from financing activities.
−Removed: The cash flows associated with interest rate swap contracts that were entered into with the intention of offsetting the economic overhedged position of a portion of our existing interest rate swaps are reflected as cash flows from investing activities.
−Removed: Interest Rate Swaps
−Removed: In October 2019, and in connection with the refinancing of variable-rate debt under the First Lien Credit Agreement in September 2019, the Company terminated interest rate swap contracts with an aggregate notional amount of $ 3.8 billion, of which $ 2.8 billion were designated as cash flow hedges, and concurrently entered into new LIBOR-based interest rate swap contracts, which were, at the time, designated as cash flow hedges, with an aggregate notional amount of $ 2.8 billion and maturity of September 2026.
−Removed: These swaps contain an other-than-insignificant financing element due to their off-market terms at the inception of the swaps.
−Removed: Beginning in March 2020, the Company's interest rate swap contracts previously designated as cash flow hedges were no longer highly effective as a result of changes in the interest rate environment.
−Removed: Accordingly, the Company de-designated the cash flow hedges, and the unrealized gains and losses for the period in which these cash flow hedges were no longer highly effective were recognized in interest expense, net.
−Removed: Unrealized losses previously recognized as a component of AOCI prior to de-designation are being reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the maturity dates of the interest rate swap contracts, as the forecasted cash flows are probable or reasonably possible of occurring.
−Removed: In March and April 2023, the Company entered into floating-to-fixed interest rate swaps with an aggregate notional amount of $ 300 million to partially hedge the Company’s then outstanding Term Loan A Facility.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: In December 2023, the Company entered into interest rate swaps with an aggregate notional amount of $ 700 million to offset the excess notional interest rate swaps as a result of the partial redemption of the First Lien Term Loan B due 2026.
−Removed: The changes in fair value associated with these swaps and the excess swaps are reflected in other income (expense).
−Removed: Notional Amounts
+Added: Cash flows associated with the Company’s derivatives are reflected as follows:
+Added: • Operating activities:
+Added: Includes cash flows associated with the Company’s interest rate swap contracts that are designated as cash flow hedges.
+Added: • Investing activities:
+Added: Includes cash flows associated with the Company’s interest rate swap contracts that were entered into with the intention of offsetting the economic overhedged position of a portion of the Company’s existing interest rate swaps.
+Added: • Financing activities:
+Added: Includes cash flows associated with the Company’s interest rate swap contracts that included an other-than-insignificant financing element at inception.
(in thousands) December 31,
Execution Maturity Designation 2025 2024
−Removed: October 2019 September 2026 Not designated $ 2,800,000 $ 2,800,000
+Added: October 2019 (1)(2)
+Added: September 2026 Not designated $ 2,800,000 $ 2,800,000
March 2023 March 2028 Not designated 100,000 100,000
2 unchanged sentences
September 2026 Not designated 700,000 700,000
+Added: June 2025 (3)
+Added: Cash flow hedge
+Added: July 2025 (3)
+Added: Cash flow hedge
+Added: July 2025 March 2032
+Added: Not designated 100,000 —
+Added: September 2025 (4)
+Added: Cash flow hedge
+Added: October 2025 (3)
+Added: December 2030
+Added: Cash flow hedge
+Added: October 2025 (3)
+Added: March 2032 Cash flow hedge
+Added: October 2025 (4)
+Added: December 2027 Cash flow hedge
Total notional amount $ 6,850,000 $ 3,800,000
+Added: ___________________
+Added: (1) These swaps contain an other-than-insignificant financing element due to their off-market terms at the inception.
+Added: Prior to March 2020, these swaps were designated as cash flow hedges.
+Added: (2) The December 2023 swaps were entered into to offset the excess notional interest rate swaps as a result of the partial redemption of the then outstanding First Lien Term Loan B due 2026 in connection with the Commercial Divestiture.
+Added: The changes in fair value associated with these swaps and a portion of the October 2019 swaps are reflected in other income (expense).
+Added: (3) These swaps were entered into to hedge the interest rate variability on the Company’s First Lien Term Loan B-2 due 2032 or its direct replacement.
+Added: (4) These forward-starting swaps were entered into to hedge the interest rate variability on the Company’s First Lien Term Loan B due 2030 or its direct replacement with the swap settlement periods commencing in September 2026.
Classification and Fair Value
4 unchanged sentences
Other liabilities ( 3,187 ) ( 208 )
+Added: Fair value of interest rate swaps - net asset (liability) $ 37,755 $ 108,592
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Unrealized Gains (Losses)
7 unchanged sentences
Changes in and Reclassifications out of AOCI
−Removed: (in thousands) Cash Flow Hedges
+Added: (in thousands)
Balance as of December 31, 2022 $ ( 45,513 )
10 unchanged sentences
As of December 31, 2025, AOCI associated with previously designated cash flow hedges that is estimated to be reclassified to interest expense, net, within the next twelve months is not material.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the temporary differences between the recognition of revenue and expenses for income tax and financial reporting purposes and between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements.
7 unchanged sentences
Income (loss) from continuing operations before income taxes and equity in net earnings (losses) of equity method investee $ 833,812 $ 815,170 $ 604,383
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Components of Income Tax Benefit (Expense) (1)
9 unchanged sentences
Deferred income tax benefit (expense) ( 142,190 ) ( 139,583 ) ( 124,947 )
−Removed: Income tax benefit (expense) $ ( 154,481 ) $ ( 183,252 ) $ ( 48,550 )
+Added: Total income tax benefit (expense)
$ ( 231,760 ) $ ( 154,481 ) $ ( 183,252 )
+Added: ___________________
(1) The components of tax benefit (expense) include both continuing and discontinued operations for all periods presented in accordance with Accounting Standards Codification (“ASC”) 740.
5 unchanged sentences
$ ( 181,437 )
+Added: Continuing operations (1)
+Added: $ ( 233,294 ) $ ( 195,780 ) $ ( 160,585 )
Discontinued operations 1,534 41,299 ( 22,667 )
+Added: Total income tax benefit (expense)
$ ( 231,760 ) $ ( 154,481 ) $ ( 183,252 )
−Removed: Income tax benefit (expense) $ ( 154,481 ) $ ( 183,252 ) $ ( 48,550 )
+Added: ___________________
+Added: (1) The components of income tax benefit (expense) from continuing operations are only required for the year ended December 31, 2025 due to the Company’s adoption of ASU 2023-09 on a prospective basis.
+Added: Effective Tax Rate Reconciliations
+Added: Year Ended December 31, 2025 (1)
+Added: Amount ($) Percent (%)
+Added: federal statutory tax rate
+Added: $ 175,101 21.0 %
+Added: State and local income taxes, net of federal income tax effects (2)
+Added: Foreign tax effects
+Added: ( 1,452 ) ( 0.2 ) %
+Added: Nontaxable or nondeductible items
+Added: Changes in unrecognized tax benefits
+Added: Other adjustments
+Added: Income tax expense (benefit) and effective tax rate
+Added: $ 233,294 28.0 %
+Added: ___________________
+Added: (1) The Company adopted ASU 2023-09 effective January 1, 2025, on a prospective basis, which is reflected in the table above.
+Added: (2) The following state taxes made up the majority (greater than 50%) of the tax effect in this category:
+Added: California, Florida, New York, New Jersey, Illinois.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Effective Tax Rate Reconciliation
−Removed: Reconciliations between the actual effective tax rate on continuing operations and the statutory U.S.
−Removed: federal income tax rate were as follows:
Years Ended December 31,
−Removed: 2024 2023 2022
Statutory federal tax rate 21.0 % 21.0 %
2 unchanged sentences
Non-deductible and non-taxable charges
−Removed: 0.8 % 1.0 % 5.1 %
−Removed: Valuation allowance — % — % ( 0.6 ) %
Unrecognized tax benefits ( 4.0 ) % ( 1.0 ) %
7 unchanged sentences
Effective tax rate 24.0 % 26.6 %
+Added: Income Taxes Paid (Net of Refunds Received)
+Added: Year Ended December 31,
+Added: (in thousands) 2025
+Added: Federal $ 105,500
+Added: Foreign 1,409
___________________
−Removed: (1) During 2022, primarily represents the impact related to the fair value adjustment of the Forward Contract.
+Added: (1) The Company adopted ASU 2023-09, effective January 1, 2025, on a prospective basis, which is reflected in the table above.
Deferred Tax Assets and Deferred Tax Liabilities
29 unchanged sentences
Income tax benefit (expense) (1)
−Removed: — 43,277 2,428
Write-offs and other
15 unchanged sentences
Interest and penalties associated with unrecognized tax benefits were not material to the Company's consolidated financial statements for the periods presented.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following is a roll-forward of unrecognized tax benefits:
2 unchanged sentences
Beginning balance $ 24,606 $ 48,823 $ 56,177
−Removed: Gross increase related to prior year tax positions 9,933 517 5,063
−Removed: Gross decrease related to prior year tax positions ( 5,108 ) — —
−Removed: Decreases related to lapse of statute of limitation ( 29,042 ) ( 7,871 ) ( 15,107 )
+Added: Additions for tax positions of prior years 17,715 9,933 517
+Added: Reductions for tax positions of prior years — ( 5,108 ) —
+Added: Additions for tax positions related to current year 15,057 — —
+Added: Reductions related to settlements ( 517 ) — —
+Added: Reductions related to lapse of statute of limitation — ( 29,042 ) ( 7,871 )
Ending balance $ 56,861 $ 24,606 $ 48,823
+Added: Unrecognized tax benefits that would affect the effective tax rate $ 31,398 $ 24,606 $ 48,823
The Company’s unrecognized tax benefits relate to tax years that are subject to audit by the taxing authorities in the U.S.
federal, state and local, and foreign jurisdictions.
−Removed: Based on the current tax statutes and status of its income tax audits, the
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Company does not expect unrecognized tax benefits to change significantly in the next twelve months.
+Added: Based on the current tax statutes and status of its income tax audits, the Company does not expect unrecognized tax benefits to change significantly in the next twelve months.
Open Tax Years by Jurisdiction
7 unchanged sentences
Federal Tax Legislation
−Removed: Tax Cuts and Jobs Act - Certain changes to U.S.
−Removed: federal tax law included in the Tax Cuts and Jobs Act of 2017 had a delayed effective date and have taken effect for 2022.
−Removed: Under IRC Section 163(j), the limitation on net business interest expense deductions will no longer be increased by deductions for depreciation, amortization, or depletion.
−Removed: Under IRC Section 174, specified research and experimentation expenditures must now be capitalized and amortized.
−Removed: Inflation Reduction Act - The Inflation Reduction Act (the “IRA”) was signed into law in August 2022.
−Removed: The IRA, among other provisions, implements (i) a 15% corporate alternative minimum tax (“CAMT”) on book income of corporations whose average annual adjusted financial statement income during the most recently-completed three-year period exceeds $1.0 billion, (ii) a 1% excise tax on net stock repurchases, and (iii) several tax incentives to promote clean energy including an extension of the investment tax credit.
−Removed: Both the CAMT and the excise tax provisions are effective for tax years beginning after December 31, 2022, and as of December 31, 2024, the Company does not anticipate any material impact.
+Added: One Big Beautiful Bill Act - The One Big Beautiful Bill Act (the “OBBBA”) was signed into law in July 2025.
+Added: It includes a broad range of tax reform provisions, some of which were favorable in 2025 to cash taxes.
+Added: The Company has evaluated the impact of the OBBBA on future periods and determined that the impact on cash taxes will likely be neutral.
Common Stock and Class B Common Stock
−Removed: During September 2020, the Company amended its articles of incorporation to authorize the issuance of 100,000,000 shares of Class B common stock, par value of $ 0.01 per share (“Class B Common Stock”), as well as to increase the number of authorized shares of preferred stock, par value of $ 0.01 per share, to 1,000,000 .
−Removed: In September 2020, the Company issued and sold 54,744,525 shares of Class B Common Stock for an aggregate purchase price of $ 450 million to Google LLC (“Google”) in a private placement pursuant to a securities purchase agreement dated July 31, 2020 (the “Securities Purchase Agreement”).
−Removed: Accordingly, the Company has two classes of common stock, Common Stock and Class B Common Stock, both of which entitle stockholders to one vote for each share of Common Stock.
+Added: The Company has two classes of common stock, Common Stock and Class B Common Stock, both of which entitle stockholders to one vote for each share of Common Stock.
+Added: All 54,744,525 outstanding shares of the Company’s Class B Common Stock are held by Google LLC (“Google”).
Each share of Class B Common Stock has equal status and rights to dividends as a share of Common Stock.
4 unchanged sentences
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Issuances of Common Stock
−Removed: During the periods presented, issuances of Common Stock other than as related to the exercise or vesting of share-based compensation awards includes:
−Removed: • October 2022 :
−Removed: The Company issued approximately 133 million shares of Common Stock for an aggregate purchase price of $ 1.2 billion as part of the State Farm Strategic Investment (as defined below).
−Removed: • June 2022 :
−Removed: The Company issued approximately 2 million shares of Common Stock as consideration for a business acquisition.
−Removed: Additionally, throughout 2022, the Company issued approximately 5.3 million shares of the Company’s Common Stock with a value of approximately $ 40 million related to the ADT Solar Acquisition (the “Delayed Shares”).
−Removed: Repurchases of Common Stock
−Removed: On January 24, 2024, the Company's Board of Directors announced a share repurchase plan (the “2024 Share Repurchase Plan”), pursuant to which the Company was authorized, but not obligated, to repurchase up to a maximum aggregate amount of $ 350 million of shares of the Company's Common Stock through January 29, 2025.
−Removed: The 2024 Share Repurchase Plan expired in January 2025 with $ 5 million authorized repurchases remaining.
−Removed: Share repurchases under the 2024 Share Repurchase Plan were as follows:
−Removed: • In March 2024, the Company repurchased and retired 15 million shares at a price per share of approximately $ 6.22 for an aggregate purchase price of $ 93 million in connection with an offering of the Company’s Common Stock.
−Removed: • In October 2024, the Company repurchased and retired 16 million shares at a price per share of approximately $ 7.20 for an aggregate purchase price of $ 115 million in connection with an offering of the Company’s Common Stock.
−Removed: • In October 2024, the Company repurchased and retired 5 million shares of Common Stock from a non-affiliate individual at a price per share of $ 6.40 for an aggregate purchase price of $ 32 million.
−Removed: Subsequent events
−Removed: In December 2024, the Company entered into an agreement with a non-affiliate individual to repurchase 15 million shares of Common Stock at a price per share of $ 6.95 for an aggregate purchase price of $ 104 million.
−Removed: The transaction settled in January 2025, and the Company retired the shares.
−Removed: As of December 31, 2024, the Company recorded a liability related to the forward share repurchase contract and a reduction to additional paid-in capital.
−Removed: In February 2025, the Company’s Board of Directors announced a share repurchase plan (the “2025 Share Repurchase Plan”), pursuant to which the Company is authorized to repurchase, through April 30, 2026, up to a maximum aggregate amount of $ 500 million of shares of Common Stock.
−Removed: The 2025 Share Repurchase Plan allows the Company to purchase Common Stock from time to time in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act, or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and factors.
Google Investor Rights Agreement
In connection with the issuance of the Class B Common Stock, the Company and Google entered into an Investor Rights Agreement (the “Google Investor Rights Agreement”), pursuant to which Google agreed to be bound by customary transfer restrictions and drag-along rights, and be afforded customary registration rights with respect to shares of Class B Common Stock held directly by Google.
−Removed: Under the terms of the Google Investor Rights Agreement, Google was prohibited, subject to certain exceptions, from transferring any shares of Class B Common Stock or any shares of Common Stock issuable upon conversion of the Class B Common Stock beneficially owned by Google through September 2023, or earlier if certain conditions occurred (the “Google Lock-up Period”).
−Removed: In December 2023, the Company and Google amended the Google Investor Rights Agreement to extend the Google Lock-up Period through June 2025, or earlier if (i) the Google Commercial Agreement (as defined in Note 13 “Commitments and Contingencies”) has been terminated under certain specified circumstances or (ii) the Google Cloud Master Agreement (as defined in Note 13 “Commitments and Contingencies”) has been validly terminated for any reason other than Google's uncured material breach.
+Added: Under the terms of the Google Investor Rights Agreement, as amended in December 2023, Google was prohibited, subject to certain exceptions, from transferring any shares of Class B Common Stock or any shares of Common Stock issuable upon conversion of the Class B Common Stock beneficially owned by Google, which ended in June 2025.
+Added: Share Repurchases
+Added: The Company’s share repurchase plans, as defined below, allowed the Company to purchase Common Stock from time to time in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act, or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and other factors.
+Added: The Company was not obligated to repurchase any of its shares of Common Stock, and the timing and amount of any repurchases depended on legal requirements, market conditions, stock price, the availability of the safe harbor provided by Rule 10b-18 under the Exchange Act, alternative uses of capital, and other factors.
+Added: 2024 Share Repurchase Plan
+Added: In January 2024, the Company's Board of Directors announced a share repurchase plan (the “2024 Share Repurchase Plan”), pursuant to which the Company was authorized to repurchase, through January 29, 2025 up to a maximum aggregate amount of $ 350 million of shares of the Company's Common Stock.
+Added: The 2024 Share Repurchase Plan expired in January 2025 with $ 5 million authorized repurchases remaining.
+Added: • In March 2024, the Company repurchased and subsequently retired 15 million shares of its Common Stock for $ 93 million (or $ 6.22 per share) in connection with an offering of the Company’s Common Stock by Apollo.
+Added: Refer to Note 16 “Related Party Transactions” for further information.
+Added: • In October 2024, the Company repurchased and subsequently retired 16 million shares at a price per share of approximately $ 7.20 for an aggregate purchase price of $ 115 million in connection with an offering of the Company’s Common Stock.
+Added: • In October 2024, the Company repurchased and subsequently retired 5 million shares of Common Stock from a non-affiliate individual at a price per share of $ 6.40 for an aggregate purchase price of $ 32 million.
+Added: • The Company entered into an agreement in December 2024 to repurchase 15 million shares of Common Stock from a non-affiliate individual at a price per share of $ 6.95 for a total of $ 104 million.
+Added: The transaction settled in January 2025, and the Company retired the shares.
+Added: 2025 Share Repurchase Plan
+Added: In February 2025, the Company’s Board of Directors announced a new share repurchase plan (the “2025 Share Repurchase Plan”), pursuant to which the Company is authorized to repurchase, through April 30, 2026, up to a maximum aggregate amount of $ 500 million of shares of the Company’s Common Stock.
+Added: As of December 31, 2025, the Company had no authorized amounts remaining under the 2025 Share Repurchase Plan.
+Added: • In March 2025, the Company repurchased, and subsequently retired, 20 million shares of its Common Stock for $ 152 million (or $ 7.62 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo.
+Added: Refer to Note 16 “Related Party Transactions” for further information.
+Added: • In March 2025, the Company repurchased, and subsequently retired, an additional 18 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act in multiple transactions for $ 140 million (or $ 7.79 per share).
+Added: • Throughout the second quarter of 2025, the Company repurchased, and subsequently retired, 12 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act in multiple transactions for a total of $ 96 million (or $ 8.14 per share).
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: • In July 2025, the Company repurchased, and subsequently retired, 11 million shares of its Common Stock for $ 93 million (or $ 8.31 per share) in connection with a secondary offering of the Company’s Common Stock by Apollo.
+Added: Refer to Note 16 “Related Party Transactions” for further information.
+Added: • In July 2025, the Company repurchased, and subsequently retired, an additional 2 million shares in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act in multiple transactions for a total of $ 19 million (or $ 8.45 per share).
+Added: Subsequent Event - 2026 Share Repurchase Plan
+Added: On February 20, 2026, the Board of Directors authorized a three-year share repurchase plan (the “2026 Share Repurchase Plan”), pursuant to which the Company is authorized to repurchase, through April 30, 2029, up to a maximum aggregate amount of $ 1.5 billion of shares of the Company's Common Stock.
+Added: The 2026 Share Repurchase Plan allows the Company to purchase shares of its Common Stock from time to time in one or more open market or privately negotiated transactions, including pursuant to Rule 10b5-1 or Rule 10b-18 of the Exchange Act or pursuant to one or more accelerated share repurchase agreements, subject to certain requirements and other factors.
+Added: The Company is not obligated to repurchase any of its shares of Common Stock, and the timing and amount of any repurchases will depend on legal requirements, market conditions, stock price, the availability of certain safe harbors provided under the Exchange Act, alternative uses of capital, and other factors.
State Farm Transaction
−Removed: State Farm Strategic Investment
−Removed: On September 5, 2022, the Company entered into a securities purchase agreement (the “State Farm Securities Purchase Agreement”) with State Farm, pursuant to which the Company agreed to issue and sell in a private placement to State Farm 133 million shares of the Company’s Common Stock (the “State Farm Shares”) at a per share price of $ 9.00 for an aggregate purchase price of $ 1.2 billion (the “State Farm Strategic Investment”).
−Removed: The transaction closed on October 13, 2022 (the “Closing”).
−Removed: Additionally, on September 12, 2022, in connection with the State Farm Strategic Investment, the Company commenced a tender offer (discussed below) to purchase up to 133 million shares of the Company’s Common Stock (including shares issued upon conversion of shares of Class B Common Stock ) (the “Tender Shares”) at a price of $ 9.00 per share (the “Tender Offer”) using proceeds from the State Farm Strategic Investment.
−Removed: After the Closing and the Tender Offer, State Farm owned approximately 15 % of the Company’s issued and outstanding Common Stock (assuming conversion of Class B Common Stock) and became a related party.
−Removed: Concurrently with the execution of the State Farm Securities Purchase Agreement, (i) Apollo delivered to the Company a Tender and Support Agreement, pursuant to which Apollo agreed to collectively tender (and not withdraw) no fewer than 133 million shares of Common Stock in the Tender Offer (the “Apollo Support Agreement”), and (ii) Google delivered to the Company a Support Agreement, pursuant to which Google agreed to not convert and tender any of its shares of Class B Common Stock.
−Removed: The Tender Offer expired on October 20, 2022.
−Removed: On October 26, 2022, the Company used proceeds from the State Farm Strategic Investment to repurchase an aggregate of 133 million shares of the Company’s Common Stock at a purchase price of $ 9.00 per share for an aggregate purchase price of $ 1.2 billion, excluding fees and expenses, subject to the terms and conditions described in the Offer to Purchase dated September 12, 2022 (as amended from time to time, the “Offer to Purchase”).
−Removed: The Tender Shares were subject to the “odd lot” priority and proration provisions described in the Offer to Purchase as the Tender Offer was substantially over-subscribed.
−Removed: No shares of Class B Common Stock were converted and tendered in the Tender Offer.
−Removed: The Tender Offer was considered a contingent forward purchase contract (the “Forward Contract”), which was recorded at fair value in the Consolidated Balance Sheet.
−Removed: The fair value of the Forward Contract was estimated as the difference between the present value of the cash consideration to be paid and the value of the Company’s Common Stock to be tendered.
−Removed: At the commencement of the Tender Offer, the Company recorded a liability and a reduction to additional paid in capital of $ 42 million.
−Removed: During 2022, the change in fair value recognized in other income (expense) was a net loss of $ 63 million.
−Removed: Fees associated with the Tender Offer were not material.
State Farm Investor Rights Agreement
−Removed: At the Closing, the Company and State Farm entered into an Investor Rights Agreement (the “State Farm Investor Rights Agreement”), pursuant to which the Board of Directors of the Company increased its size by one director and appointed a designee of State Farm as a member of the Board of Directors.
−Removed: Pursuant to the terms of the State Farm Investor Rights Agreement, State Farm will also be bound by customary transfer and standstill restrictions and drag-along rights, and be afforded customary registration rights with respect to the State Farm Shares.
−Removed: In particular, State Farm (a) will be prohibited, subject to certain customary exceptions, from transferring any of the State Farm Shares until the earlier of (i) October 13, 2025, and (ii) the date on which the development agreement with State Farm (the “State Farm Development Agreement”) has been validly terminated, other than in the event of termination by the Company for a material breach thereof by State Farm, and (b) will be subject to certain standstill restrictions, including that State Farm will be restricted from acquiring additional equity securities of the Company if such acquisition would result in State Farm (and its affiliates) acquiring beneficial ownership in excess of 18 % of the issued and outstanding Common Stock, taking into account on an as-converted basis the issued and outstanding Class B Common Stock, until five days after the date that no designee of State Farm serves on the Board of Directors and State Farm has no rights (or has irrevocably waived its right) to nominate a designee to the Board of Directors.
+Added: In October 2022, the Company and State Farm entered into an Investor Rights Agreement (the “State Farm Investor Rights Agreement”), pursuant to which the Board of Directors of the Company increased its size by one director and appointed a designee of State Farm as a member of the Board of Directors.
+Added: Pursuant to the terms of the State Farm Investor Rights Agreement, State Farm was bound by customary transfer and standstill restrictions and drag-along rights, and be afforded customary registration rights with respect to the State Farm Shares.
+Added: In particular, State Farm (a) was prohibited, subject to certain customary exceptions, from transferring any of the State Farm Shares until the earlier of (i) October 13, 2025, and (ii) the date on which the development agreement with State Farm (the “State Farm Development Agreement”) has been validly terminated, other than in the event of termination by the Company for a material breach thereof by State Farm, and (b) will be subject to certain standstill restrictions, including that State Farm will be restricted from acquiring additional equity securities of the Company if such acquisition would result in State Farm (and its affiliates) acquiring beneficial ownership in excess of 18 % of the issued and outstanding Common Stock, taking into account on an as-converted basis the issued and outstanding Class B Common Stock, until five days after the date that no designee of State Farm serves on the Board of Directors and State Farm has no rights (or has irrevocably waived its right) to nominate a designee to the Board of Directors.
Notwithstanding the standstill restrictions described above, State Farm will not be restricted from acquiring shares of Common Stock or other equity securities of the Company from Prime Security Services TopCo Parent, L.P.
−Removed: and its affiliates so long as State Farm and its affiliates would not, subject to certain exceptions, beneficially own in excess
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: of 25 % of the issued and outstanding Common Stock, taking into account on an as-converted basis the issued and outstanding Class B Common Stock, as a result of such acquisition.
+Added: and its affiliates so long as State Farm and its affiliates would not, subject to certain exceptions, beneficially own in excess of 25 % of the issued and outstanding Common Stock, taking into account on an as-converted basis the issued and outstanding Class B Common Stock, as a result of such acquisition.
In addition, under the terms of the State Farm Investor Rights Agreement, in the event that the Company proposes to issue and sell shares of Common Stock, Class B Common Stock, or other equity securities of the Company to certain homeowners’ insurance and reinsurance companies, State Farm will have a right of first refusal with respect to such proposed issuance and sale on the same terms and conditions (the “ROFR”).
3 unchanged sentences
State Farm Development Agreement
−Removed: At the Closing, the Company, ADT LLC (an indirect wholly owned subsidiary of the Company), and State Farm entered into the State Farm Development Agreement pursuant to which State Farm committed up to $ 300 million to an Opportunity Fund that will fund certain product and technology innovation, customer growth, and marketing initiatives to be agreed on between State Farm and the Company.
−Removed: Additionally at the Closing, the Company received $ 100 million of the Opportunity Fund, which is restricted until such time as the Company uses the funds in accordance with the State Farm Development Agreement.
−Removed: The Company’s use of the funds is also subject to approval by State Farm.
−Removed: The Company recorded the cash received from the Opportunity Fund as restricted cash and a corresponding liability, which is reflected in accrued expenses and other current liabilities.
+Added: At the Closing, the Company, ADT LLC (an indirect wholly owned subsidiary of the Company), and State Farm entered into the State Farm Development Agreement pursuant to which State Farm committed up to $ 300 million to an Opportunity Fund that funded certain product and technology innovation, customer growth, and marketing initiatives that were agreed on between State Farm and the Company.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Additionally at the Closing, the Company received $ 100 million of the Opportunity Fund, which was restricted until such time as the Company used the funds in accordance with the State Farm Development Agreement.
+Added: The Company’s use of the funds was also subject to approval by State Farm.
+Added: The Company recorded the cash received from the Opportunity Fund as restricted cash and a corresponding liability, which was reflected in accrued expenses and other current liabilities.
+Added: The State Farm Development Agreement expired on October 13, 2025.
+Added: On October 24, 2025, the Company repaid to State Farm substantially all of the balance of the Opportunity Fund held by the Company.
+Added: State Farm has no obligation to fund the Opportunity Fund in the future.
+Added: In addition, the Company ended its State Farm partnership programs in existing states in connection with the expiration of the State Farm Development Agreement.
Refer to Note 16 “Related Party Transactions” for more information on the Opportunity Fund.
16 unchanged sentences
During 2023, the Company declared aggregate dividends of $ 0.14 per share on Common Stock ($ 121 million) and $ 0.14 per share on Class B Common Stock ($ 8 million).
−Removed: Subsequent Event - On February 27, 2025, the Company announced a dividend of $ 0.055 per share to holders of Common Stock and Class B Common Stock of record on March 13, 2025, which will be distributed on or about April 3, 2025.
+Added: Subsequent Event - On March 2, 2026, the Company announced a dividend of $ 0.055 per share to holders of Common Stock and Class B Common Stock of record on March 12, 2026, which will be distributed on or about April 2, 2026.
Accumulated Other Comprehensive Income (Loss)
1 unchanged sentence
Other changes in AOCI, which primarily relate to the Company’s defined benefit pension plans, were not material.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SHARE-BASED COMPENSATION
10 unchanged sentences
$ 54,553 $ 48,613 $ 51,137
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The Company modified certain share-based compensation awards which resulted in additional share-based compensation expense of $ 11 million and $ 13 million in 2025 and 2024, respectively, associated with these modifications.
The following discussion of the Company’s share-based compensation awards includes awards related to continuing and discontinued operations, unless otherwise noted.
7 unchanged sentences
The Distributed Shares also have certain other restrictions pursuant to the terms and conditions of the Company’s Amended and Restated Management Investor Rights Agreement (the “MIRA”).
−Removed: The MIRA was last amended on August 1, 2024.
−Removed: The IPO triggered an acceleration of vesting of the unvested Distributed Shares Service Tranche causing them to become fully vested six months from the date of the IPO, which occurred in July 2018.
−Removed: The Company recorded share-based compensation expense on the Distributed Shares Performance Tranche on a straight-line basis over the derived service period of app roximately three years from the IPO date, as the vesting conditions were deemed probable following the consummation of the IPO.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The following table summarizes activity related to the Distributed Shares Performance Tranche during 2024:
−Removed: Number of Distributed Shares Weighted-Average Grant Date Fair Value
−Removed: Unvested as of December 31, 2023 9,194,312 $ 13.05
−Removed: ( 2,509,806 ) 13.08
−Removed: Forfeited — —
−Removed: Unvested as of December 31, 2024 6,684,506 $ 10.44
−Removed: ________________________
−Removed: (1) During the second quarter of 2024, certain of the Distributed Shares were modified in a manner that resulted in such awards immediately vesting.
+Added: The MIRA was terminated in June 2025.
+Added: During 2025, certain of the Distributed Shares were modified in a manner that resulted in such awards immediately vesting.
+Added: As of December 31, 2025, there were approximately 3.6 million Distributed Shares unvested and outstanding.
In January 2018, the Company approved the 2018 Plan, which became effective upon consummation of the IPO.
−Removed: During 2024, the Company amended the 2018 Plan to increase the number of authorized common shares to be issued under the 2018 Plan by 50 million shares.
As of December 31, 2025, the 2018 Plan, as amended, authorizes the issuance of no more than approximately 138 million shares of Common Stock by the exercise or vesting of granted awards, which are generally stock options and restricted stock units (“RSUs”).
3 unchanged sentences
The Company accounts for forfeitures as they occur.
−Removed: Additionally, RSUs entitle the holder to dividend equivalent units (“DEUs”), which are granted as additional RSUs and are subject to the same vesting and forfeiture conditions as the underlying RSUs.
−Removed: DEUs are charged against accumulated deficit when dividends are paid.
Top-up Options
3 unchanged sentences
Recipients of the Top-up Options received both vested and unvested Top-up Options in the same proportion as the vested and unvested Class B Units held immediately prior to the IPO and Class B Unit Redemption.
−Removed: The Top-up Options vesting conditions are the same as those attributable to the Distributed Shares, including the condition that accelerated vesting of the unvested options in the Top-up Options Service Tranche causing them to become fully vested six months from the IPO.
−Removed: Any shares of the Company’s Common Stock acquired upon exercise of the Top-up Options will be subject to the terms of the MIRA.
−Removed: Share-based compensation expense associated with the Top-up Options Performance Tranche was recognized on a straight-line basis over the derived service period of approximately three years from the IPO date.
+Added: The Top-up Options vesting conditions are the same as those attributable to the Distributed Shares, including the condition that accelerated vesting of the unvested options in the Top-up
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Options Service Tranche causing them to become fully vested six months from the IPO.
+Added: Any shares of the Company’s Common Stock acquired upon exercise of the Top-up Options will be subject to the terms of the MIRA.
The following table summarizes activity related to the Top-up Options:
7 unchanged sentences
Outstanding as of December 31, 2025 5,955,254 $ 13.30 5,624,601 $ 13.30 — 2.0
−Removed: Exercisable as of December 31, 2024 (b)
+Added: Exercisable as of December 31, 2025 (2)
5,955,254 $ 13.30 3,528,647 $ 13.30 — 2.0
1 unchanged sentence
(1) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2025.
−Removed: (2) During the second quarter of 2024, certain of the Top-up Options in the performance tranche were modified in a manner that resulted in such awards immediately vesting and becoming exercisable.
+Added: (2) During 2025, certain of the performance tranche of the Top-up Options were modified in a manner that resulted in such awards immediately vesting and becoming exercisable.
Options granted under the 2018 Plan are primarily service-based awards that vest over a three-year period from the date of grant, have an exercise price equal to the closing price per share of the Company’s Common Stock on the date of grant, as adjusted in accordance with 2018 Plan provisions, and have a contractual term of ten years from the date of grant.
−Removed: No options were granted under the 2018 Plan during 2023 or 2022.
−Removed: The Company used a binomial lattice model to determine the grant date fair value for options granted during 2024 and included the following assumptions:
+Added: During 2025 and 2024, the weighted-average grant date fair value for options granted during each year was $ 2.66 and $ 2.56 , respectively.
+Added: No options were granted under the 2018 Plan during 2023.
+Added: The Company used a binomial lattice model to determine the grant date fair value for options granted in 2025 based on the following assumptions:
+Added: Years Ended December 31,
Expected exercise term (years)
Expected volatility (1)
+Added: 41.7 % - 42.3 %
Expected dividend yield (2)
+Added: 2.8 % - 2.9 %
Risk-free interest rate (3)
4.2 % - 4.2 %
+Added: ________________________
(1) Estimated using historical and implied stock price volatility of the Company.
2 unchanged sentences
Treasury yield curve.
−Removed: The weighted-average grant date fair value for the options granted during 2024 was $ 2.56 .
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table summarizes activity related to 2018 Plan options during 2025:
10 unchanged sentences
(1) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2025.
−Removed: Share-based compensation expense associated with options granted under the 2018 Plan was not material during the periods presented.
−Removed: In addition, the cash flow and the intrinsic value of options exercised were not material during the periods presented.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: As of December 31, 2024, unrecognized compensation cost related to options was not material.
+Added: Cash received from the exercise of stock options was $ 19 million during 2025, and not material during 2024 and 2023.
+Added: The intrinsic value of options exercised was $ 6 million during 2025 and was not material during 2024 and 2023.
+Added: Share-based compensation expense associated with options granted under the 2018 Plan was $ 17 million, $ 11 million, and $ 1 million during 2025, 2024, and 2023, respectively.
+Added: As of December 31, 2025, unrecognized compensation cost related to options was $ 8 million.
Restricted Stock Units
1 unchanged sentence
The fair value is equal to the closing price per share of the Company’s Common Stock on the date of grant.
+Added: Additionally, RSUs entitle the holder to dividend equivalent units (“DEUs”), which are granted as additional RSUs and are subject to the same vesting and forfeiture conditions as the underlying RSUs.
+Added: DEUs are charged against accumulated deficit when dividends are paid.
The following table summarizes activity related to the 2018 Plan RSUs (including DEUs) during 2025:
5 unchanged sentences
Unvested as of December 31, 2025 7,981,940 $ 7.31
−Removed: During 2024, 2023, and 2022, total share-based compensation expense associated with RSUs granted under the 2018 Plan was $ 25 million, $ 47 million, and $ 55 million, respectively, the majority of which relates to the Company’s continuing operations.
The weighted-average grant date fair value of RSU’s granted during 2024 and 2023 was $ 6.65 and $ 7.56 , respectively.
+Added: During 2025, 2024, and 2023, total share-based compensation expense associated with RSUs granted under the 2018 Plan was $ 27 million, $ 25 million, and $ 47 million, respectively, the majority of which relates to the Company’s continuing operations.
During 2025, 2024, and 2023, the fair value of RSUs (including DEUs) that vested and converted to shares of Common Stock on their respective vesting dates was approximately $ 33 million, $ 34 million, and $ 56 million, respectively.
As of December 31, 2025, unrecognized compensation cost related to RSUs granted under the 2018 Plan was $ 25 million, which will be recognized over a period of approximately 1.7 years.
−Removed: During the second quarter of 2024, the Company modified certain share-based compensation awards and recorded additional share-based compensation expense of $ 13 million in 2024 associated with these modifications.
−Removed: NET INCOME (LOSS) PER SHARE
−Removed: The Company applies the two-class method for computing and presenting net income (loss) per share for each class of common stock, which allocates current period net income (loss) to each class of common stock and participating securities based on dividends declared and participation rights in the remaining undistributed earnings or losses.
−Removed: Basic net income (loss) per share is computed by dividing the net income (loss) allocated to each class of common stock by the related weighted-average number of shares outstanding during the period.
−Removed: Diluted net income (loss) per share gives effect to all securities representing potential common shares that were dilutive and outstanding during the period for each class of common stock and excludes potentially dilutive securities whose effect would have been anti-dilutive.
−Removed: Potential shares of Common Stock include (i) incremental shares related to the vesting or exercise of share-based compensation awards, warrants, and other options to purchase additional shares of the Company’s Common Stock calculated using the treasury stock method and (ii) incremental shares of Common Stock issuable upon the conversion of Class B Common Stock.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Subsequent event - In connection with the Origin AI Acquisition, the Board of Directors approved a grant of RSUs (the “Origin AI Retention Awards”) as a material inducement for certain key employees of Origin AI to remain employed with the Company following the acquisition.
+Added: The Company filed a registration statement on Form S-8, which registers 8.1 million shares of Common Stock that are issuable upon vesting and settlement of the Origin AI Retention Awards.
+Added: EARNINGS PER SHARE
+Added: The Company applies the two-class method for computing and presenting earnings per share for each class of common stock, which allocates current period income (losses) to each class of common stock and participating securities based on dividends declared and participation rights in the remaining undistributed earnings or losses.
+Added: Basic earnings per share is computed by dividing the income (losses) allocated to each class of common stock by the related weighted-average number of shares outstanding during the period.
+Added: Diluted earnings per share gives effect to all securities representing potential common shares that were dilutive and outstanding during the period for each class of common stock and excludes potentially dilutive securities whose effect would have been anti-dilutive.
+Added: Potential shares of Common Stock include (i) incremental shares related to the vesting or exercise of share-based compensation awards, warrants, and other options to purchase additional shares of the Company’s Common Stock calculated using the treasury stock method and (ii) incremental shares of Common Stock issuable upon the conversion of Class B Common Stock.
Years Ended December 31,
25 unchanged sentences
The basic and diluted earnings per share computations for Common Stock exclude approximately 4 million, 7 million, and 9 million unvested shares during 2025, 2024, and 2023, respectively, as their vesting is contingent upon achievement of certain performance requirements which had not been met during the respective periods.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Class B Common Stock
24 unchanged sentences
(1) There were no potential shares of Class B Common Stock during the periods presented.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
COMMITMENTS AND CONTINGENCIES
4 unchanged sentences
$ 273,447 $ 86,684 $ 69,714 $ 18,286 $ — $ 448,131
−Removed: During the fourth quarter of 2023, the Company entered into an agreement with one of its vendors to purchase at least $ 190 million of security system equipment and components through March 2025.
−Removed: During 2024, the Company increased its commitment by approximately $ 180 million and extended the commitment period through December 2025.
−Removed: This commitment is also satisfied through purchases made by the Company’s dealer network.
−Removed: Included in the table above is approximately $ 172 million remaining under this commitment as of December 31, 2024.
Google Commercial Agreement
−Removed: In July 2020, the Company and Google entered into a Master Supply, Distribution, and Marketing Agreement (as amended, the “Google Commercial Agreement”), pursuant to which Google has agreed to supply the Company with certain Google devices, as well as certain Google video and analytics services (“Google Devices and Services”), for sale to the Company’s customers.
−Removed: The Google Commercial Agreement also specifies that each party shall contribute $ 150 million towards joint marketing, customer acquisition, training of the Company’s employees, and product technology updates related to the Google Devices and Services.
+Added: In July 2020, the Company and Google LLC (“Google”) entered into a Master Supply, Distribution, and Marketing Agreement (as amended, the “Google Commercial Agreement”), pursuant to which, among other things, each party shall contribute $ 150 million towards joint marketing, customer acquisition, training of the Company’s employees, and product technology updates related to the Google Devices and Services.
In August 2022, the Company and Google executed an amendment to the Google Commercial Agreement, pursuant to which Google has agreed to commit an additional $ 150 million to fund growth, data and insights, product innovation and technology advancements, customer acquisition, and marketing, as mutually agreed by the Company and Google, (together with the initial amounts, the “Google Success Funds”).
−Removed: During 2024 and 2023, $ 30 million and $ 40 million, respectively, of the Google Success Funds were reimbursed to the Company primarily for certain joint marketing and customer acquisition expenses incurred by the Company, substantially all of which was recorded as a reduction of advertising costs.
+Added: As of December 31, 2025, the Company had incurred approximately $ 100 million related to the initiatives funded from the initial segment of the Google Success Funds.
+Added: The Company was reimbursed $ 30 million for each of the years 2025 and 2024 and $ 40 million for 2023 from the Google Success Funds, primarily for certain joint marketing and customer acquisition expenses incurred by the Company;
+Added: substantially all of the reimbursement was recorded as a reduction to advertising expenses.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Google Cloud Agreement Addendum
−Removed: In December 2023, the Company and Google entered into an addendum to the Company’s existing agreement with Google for using Google cloud services (the “Google Cloud Agreement Addendum”), pursuant to which Google has agreed to provide certain credits, discounts, and other incentives for use of the Google Cloud Platform to the Company, and the Company has committed to purchasing $ 200 million of Google Cloud Platform services over seven years (through December 2030), with an aggregate of $ 35 million in the first two years , an aggregate of $ 65 million in the next two years after that, and an aggregate of $ 100 million in the last three years of the commitment.
+Added: In December 2023, the Company and Google entered into an addendum to the Company’s existing agreement with Google for using Google cloud services (the “Google Cloud Agreement Addendum”), pursuant to which Google has agreed to provide certain credits, discounts, and other incentives for use of the Google Cloud Platform to the Company, and the Company has committed to purchasing $ 200 million of Google Cloud Platform services over seven years (through December 2030), with $ 35 million in the first two years , $ 65 million in the next two years after that, and $ 100 million in the last three years of the commitment.
The Company may elect to cancel the commitment in return for a cancellation fee of 30 % of the total remaining commitment amount and loss of any discounts, remaining credits, or other incentives provided under the Google Cloud Agreement Addendum.
−Removed: As of December 31, 2024, the Company is on track to meet these commitments.
+Added: As of December 31, 2025, the Company continues to work to meet this commitment.
In the normal course of business, the Company is liable for contract completion and product performance.
−Removed: The Company’s guarantees primarily relate to standby letters of credit related to its insurance programs and totaled $ 74 million and $ 78 million as of December 31, 2024 and 2023, respectively.
+Added: As of December 31, 2025 and 2024 the Company’s guarantees primarily relate to standby letters of credit related to its insurance programs and totaled $ 48 million and $ 74 million, respectively.
The Company does not believe such obligations will materially affect its financial position, results of operations, or cash flows.
−Removed: Subsequent event - In February 2025, $ 21 million of the Company’s guarantees were relinquished.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Legal Proceedings
5 unchanged sentences
Legal costs in connection with claims and lawsuits in the ordinary course of business are expensed as incurred.
−Removed: Additionally, the Company records insurance recovery receivables from third-party insurers when recovery has been determined to be probable.
−Removed: The Company has not accrued for any contingent liabilities for which the likelihood of loss cannot be determined, is less than probable, or for which the range of potential loss cannot be reasonably estimated.
−Removed: As of December 31, 2024 and 2023, the Company’s accrual for ongoing claims and lawsuits within the scope of an insurance program totaled $ 94 million and $ 110 million, respectively, including amounts related to discontinued operations.
+Added: Additionally, the Company records insurance recovery receivables or other indemnifications from third parties when recovery has been determined to be probable.
+Added: The Company has not accrued for any losses for which the likelihood of loss cannot be assessed, is less than probable, or the range of possible loss cannot be estimated.
+Added: As of December 31, 2025 and 2024, the Company’s accrual for ongoing claims and lawsuits within the scope of an insurance program, including certain amounts related to discontinued operations, totaled $ 86 million and $ 94 million, respectively.
The Company’s accrual related to ongoing claims and lawsuits not within the scope of an insurance program is not material.
Company as Lessee
−Removed: As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034, primarily through its main operating entity, ADT LLC.
+Added: As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034, primarily through its main operating entity and wholly-owned subsidiary, ADT LLC.
For these transactions, the Company applies the practical expedient to not separate the lease and non-lease components and accounts for the combined component as a lease.
2 unchanged sentences
Lease payments are recognized as lease cost on a straight-line basis over the lease term, which is determined as the non-cancelable period, including periods in which termination options are reasonably certain of not being exercised and periods in which renewal options are reasonably certain of being exercised.
−Removed: The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at the commencement of a lease.
+Added: The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: the commencement of a lease.
The incremental borrowing rate is estimated based on publicly available data for the Company’s debt instruments and other instruments with similar characteristics.
3 unchanged sentences
The Company’s subleases are not material.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Right-of-Use Assets and Lease Liabilities
12 unchanged sentences
_________________
−Removed: (1) Finance right-of-use assets are recorded net of accumulated depreciation of approximately $ 66 million and $ 50 million as of December 31, 2024 and 2023, respectively.
+Added: (1) Finance lease right-of-use assets are recorded net of accumulated depreciation which was approximately $ 87 million and $ 66 million as of December 31, 2025 and 2024, respectively.
Years Ended December 31,
7 unchanged sentences
Total lease cost $ 90,271 $ 88,821 $ 84,927
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Cash Flow and Supplemental Information (1)
12 unchanged sentences
__________________
−Removed: (1) Includes both continuing and discontinued operations consistent with the presentation on the Consolidated Statements of Cash Flows.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: (1) Includes both continuing and discontinued operations as applicable.
Lease Term and Discount Rate
20 unchanged sentences
The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components, and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component.
7 unchanged sentences
These multi-employer plans, including the Company’s required contributions and any underfunded liabilities under such plans, are not material to the Company’s consolidated financial statements.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Defined Benefit Plans
−Removed: Prior to termination during 2024, the Company provided a defined benefit pension plan and certain other postretirement benefits to certain employees, which were frozen and were not material to the Company’s consolidated financial statements.
+Added: The Company previously provided a defined benefit pension plan and certain other postretirement benefits to certain employees, which were frozen and were not material to the Company’s consolidated financial statements.
During 2023, the Company took actions to terminate the defined benefit pension plan.
The termination was effective December 31, 2023, and the wind down of the plan and distribution of assets occurred in the fourth quarter of 2024 through a combination of lump sum cash distributions to certain plan participants and the purchase of non-participating annuity contracts for the remainder of the plan participants, all of which resulted in the full settlement of the Company’s defined benefit pension plan obligations as of December 31, 2024.
−Removed: Cash contributions of approximately $ 8 million were made to fully fund the plan and effectuate the settlement.
+Added: Cash contributions of approximately $ 8 million were made in 2024 to fully fund the plan and effectuate the settlement.
Charges primarily resulting from the write-off of amounts previously recorded in AOCI as well as other expenses associated with the settlement of the Company’s defined benefit pension plan were not material.
−Removed: As of December 31 2023, the fair value of pension plan assets was $ 51 million and the fair value of projected benefit obligations was $ 59 million.
−Removed: As a result, the plan was underfunded by approximately $ 8 million as of December 31, 2023 and was recorded as a net liability.
−Removed: Net periodic benefit cost associated with these plans was not material during the periods presented.
Deferred Compensation Plan
The Company maintains a non-qualified supplemental savings and retirement plan, which permits eligible employees to defer a portion of their compensation.
−Removed: Deferred compensation liabilities are reflected in other liabilities and were $ 34 million and $ 31 million as of December 31, 2024 and 2023, respectively.
+Added: Deferred compensation liabilities are primarily reflected in other liabilities and were $ 45 million and $ 34 million as of December 31, 2025 and 2024, respectively.
Deferred compensation expense was not material during the periods presented.
RELATED PARTY TRANSACTIONS
−Removed: The Company’s related party transactions primarily relate to products and services received from, or monitoring and related services provided to, other entities affiliated with Apollo, as well as, from time to time, certain transactions between the Company and Apollo and State Farm.
+Added: The Company’s related party transactions primarily relate to products and services received from, or monitoring and related services provided to, other entities affiliated with Apollo, and, from time to time, certain transactions with Apollo or State Farm.
Other than as described below, there were no significant related party transactions during the periods presented.
−Removed: Offerings and Share Repurchases
−Removed: On March 6, 2024, the Company and certain entities managed by affiliates of Apollo Global Management, Inc.
−Removed: (the “Selling Stockholders”) entered into an underwriting agreement (the “March 2024 Underwriting Agreement”) with Morgan Stanley & Co.
−Removed: LLC and Barclays Capital Inc., as representatives of the underwriters named therein, including Apollo Global Securities, LLC, an affiliate of Apollo (collectively, the “March 2024 Underwriters”), in connection with the offer and sale by the Selling Stockholders (the “March 2024 Offering”) of 65 million shares of the Company’s Common Stock, and, at the option of the March 2024 Underwriters, up to an additional 9.75 million shares of Common Stock (the “March 2024 Underwriters’ Option”).
−Removed: • As part of the March 2024 Offering, the Company purchased 15 million shares of Common Stock under its 2024 Share Repurchase Plan from the March 2024 Underwriters (the “March 2024 Share Repurchase”).
−Removed: The Company paid approximately $ 93 million (or approximately $ 6.22 per share) for the March 2024 Share Repurchase, which was the same per share price paid by the March 2024 Underwriters to the Selling Stockholders.
−Removed: • The March 2024 Offering and the March 2024 Share Repurchase closed on March 11, 2024.
−Removed: On March 15, 2024, the March 2024 Underwriters exercised the March 2024 Underwriters’ Option in full, which subsequently closed on March 19, 2024.
−Removed: The Company did not pay any underwriting fees in connection with the March 2024 Share Repurchase, including on behalf of the Selling Stockholders or otherwise.
−Removed: On October 28, 2024, the Company and the Selling Stockholders entered into an underwriting agreement (the “October 2024 Underwriting Agreement”) with Barclays Capital Inc., Citigroup Global Markets Inc., and BTIG, LLC, as representatives of the underwriters named therein, (collectively, the “October 2024 Underwriters”), in connection with the offer and sale by the Selling Stockholders (the “October 2024 Offering”) of 56 million shares of the Company’s Common Stock, and, at the option of the October Underwriters, up to an additional 8.4 million shares of Common Stock (the “October 2024 Underwriters’ Option”).
+Added: March 2025 Offering and Share Repurchase
+Added: During the first quarter of 2025, certain entities managed by affiliates of Apollo Global Management, Inc.
+Added: (the “Selling Stockholders”) sold 70 million shares of the Company’s Common Stock (plus an additional 10.5 million shares at the option of the underwriters) (the “March 2025 Offering”).
+Added: In connection with the March 2025 Offering, the Company repurchased, and subsequently retired, 20 million shares of its Common Stock under the 2025 Share Repurchase Plan for an aggregate purchase price of $ 152 million (or approximately $ 7.62 per share).
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: • As part of the October 2024 Offering, the Company purchased 16 million shares of Common Stock under its 2024 Share Repurchase Plan from the October 2024 Underwriters (the “October 2024 Share Repurchase”).
−Removed: The Company paid approximately $ 115 million (or approximately $ 7.20 per share) for the October 2024 Share Repurchase, which was the same per share price paid by the October 2024 Underwriters to the Selling Stockholders.
−Removed: • The October 2024 Offering and the October 2024 Share Repurchase closed on October 30, 2024.
−Removed: On November 6, 2024, the October 2024 Underwriters exercised the October 2024 Underwriters’ Option in full, which subsequently closed on November 8, 2024.
−Removed: The Company did not pay any underwriting fees in connection with the October 2024 Share Repurchase, including on behalf of the Selling Stockholders or otherwise.
−Removed: All the shares in the Offerings were sold by the Selling Stockholders.
−Removed: The Company did not receive any of the proceeds from the sale of shares by the Selling Stockholders in the Offerings.
−Removed: The March 2024 and October 2024 repurchases (collectively, “Repurchases”) are reflected as a reduction to additional paid-in-capital and as a financing cash outflow.
−Removed: During 2023, the Company incurred fees to Apollo of $ 1 million related to Apollo’s performance of placement agent services related to the initial funding of the Term Loan A Facility.
−Removed: As discussed in Note 10 “Equity,” State Farm is a related party as it owns more than 10 % of the Company’s issued and outstanding Common Stock.
−Removed: As of December 31, 2024 and 2023, the balance in the portion of the Opportunity Fund held by the Company was $ 85 million and $ 94 million, respectively.
−Removed: State Farm customers can receive ADT home security products and professional monitoring at a reduced cost.
−Removed: In connection with this arrangement, the Company receives a subsidy from State Farm through the Opportunity Fund.
−Removed: During 2024 and 2023, payments from the Opportunity Fund were $ 14 million and $ 11 million, respectively, related to marketing, the subsidy discussed above, and taxes.
+Added: June 2025 Apollo Sale
+Added: During the second quarter of 2025, the Selling Stockholders sold an aggregate of 45 million shares of the Company’s Common Stock in the open market at a price of $ 8.27 per share (the “June 2025 Apollo Sale”).
+Added: Immediately following the June 2025 Apollo Sale, Apollo owned less than 25 % of the Company’s outstanding Common Stock and, as a result, the Company’s Amended and Restated Management Investor Rights Agreement terminated.
+Added: The consent rights described in Section 4.1 of the Amended and Restated Stockholders Agreement also terminated following the June 2025 Apollo Sale.
+Added: Additionally, the margin loan as defined and discussed in the 2024 Annual Report was paid off in full following the June 2025 Apollo Sale.
+Added: July 2025 Offering and Share Repurchase
+Added: During the third quarter of 2025, the Selling Stockholders sold 71 million shares of the Company’s Common Stock (plus an additional 10.65 million shares at the option of the underwriters) (the “July 2025 Offering”).
+Added: In connection with the July 2025 Offering, the Company repurchased, and subsequently retired, 11 million shares of its Common Stock under the 2025 Share Repurchase Plan for an aggregate purchase price of $ 93 million (or approximately $ 8.31 per share).
+Added: March 2024 Offering and Share Repurchase
+Added: During first quarter of 2024, the Selling Stockholders sold 65 million shares of the Company’s Common Stock (plus an additional 9.75 million shares at the option of the underwriters (the “March 2024 Offering”).
+Added: In connection with the March 2024 Offering, the Company repurchased, and subsequently retired 15 million shares of its Common Stock under the 2024 Share Repurchase Plan for an aggregate purchase price of $ 93 million (or approximately $ 6.22 per share).
+Added: The shares in the above offerings were sold by the Selling Stockholders;
+Added: and the Company did not receive any of the proceeds from the sale of shares by the Selling Stockholders.
+Added: In addition, the Company did not pay any underwriting fees, including on behalf of the Selling Stockholders or otherwise.
+Added: Other Transactions with Apollo
+Added: Other fees incurred to Apollo were not material during the periods presented.
+Added: State Farm owns more than 10 % of the Company’s issued and outstanding Common Stock, and as a result, is a related party.
+Added: Please refer to Note 10 “Equity” for additional information.
+Added: The State Farm Development Agreement expired on October 13, 2025.
+Added: On October 24, 2025, the Company repaid to State Farm substantially all of the balance of the Opportunity Fund held by the Company.
+Added: State Farm has no obligation to fund the Opportunity Fund in the future.
+Added: In addition, the Company ended its State Farm partnership programs in existing states in connection with the expiration of the State Farm Development Agreement.
+Added: As of December 31, 2025, the balance in the portion of the Opportunity Fund held by the Company was not material.
+Added: As of December 31, 2024 the balance in the portion of the Opportunity Fund held by the Company was $ 85 million.
+Added: During 2025 and 2024, payments from the Opportunity Fund were $ 10 million and $ 14 million, respectively.
Interest earned on the Opportunity fund was not material.
+Added: Fleet Management Agreement
+Added: During the second quarter of 2025, the Company entered into an agreement with a vendor affiliated with Apollo for fleet management and related services through 2030.
+Added: During 2025, the Company incurred net fees to the vendor in the amount of approximately $ 5 million.
Prior to the Canopy Termination during 2023, Canopy was considered a related party under GAAP as the Company accounted for its investment under the equity method of accounting.
−Removed: Except for as described in Note 5 “Equity Method Investments,” there were no other significant transactions with Canopy during the periods presented.
+Added: There were no other significant transactions with Canopy during the periods presented.
+Added: Refer to Note 5 “Equity Method Investments” for additional information.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Sunlight Financial LLC
1 unchanged sentence
As of December 2023, Sunlight was no longer affiliated with Apollo, and as a result, is no longer a related party.
−Removed: During 2023 and 2022, total loans funded by Sunlight were approximately $ 78 million and $ 436 million, respectively, and the Company incurred $ 13 million and $ 54 million, respectively, of financing fees.
−Removed: During October 2020, the Company entered into a master services agreement with Rackspace US, Inc.
−Removed: (“Rackspace”), an entity affiliated with Apollo, for the provision of cloud storage, equipment, and services to facilitate the implementation of the Company’s cloud migration strategy for certain applications.
−Removed: The master services agreement included a minimum purchase commitment of $ 50 million over a seven-year term, which the Company satisfied during 2023 through spend with Rackspace as well as other parties.
−Removed: The Company incurred fees to Rackspace of $ 4 million, $ 15 million, and $ 14 million during 2024, 2023, and 2022, respectively.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: During 2023, total loans funded by Sunlight were approximately $ 78 million and the Company incurred $ 13 million of financing fees.
+Added: The Company incurred fees to Rackspace US, Inc.
+Added: (“Rackspace”), an entity affiliated with Apollo, for the provision of cloud storage, equipment, and services of $ 4 million and $ 15 million during 2024 and 2023, respectively.
+Added: The Company did not incur any fees to Rackspace during 2025.
Other Transactions
−Removed: During 2024 and 2023, the Company incurred fees for telephone and technology services of approximately $ 4 million and $ 6 million, respectively, with an entity affiliated with Apollo that became a related party during 2023.
+Added: During 2025, 2024 and 2023, the Company incurred fees for telephone and technology services of approximately $ 1 million, $ 4 million and $ 6 million, respectively, with an entity affiliated with Apollo that became a related party during 2023.
AND SUBSIDIARIES
30 unchanged sentences
Interest expense, net ( 9,298 ) ( 9,135 ) ( 8,984 )
−Removed: Other income (expense) — — ( 63,394 )
Equity in net income (loss) of subsidiaries 606,459 511,171 470,520
26 unchanged sentences
Equity in net (income) loss of subsidiaries ( 606,459 ) ( 511,171 ) ( 470,520 )
−Removed: Change in fair value of other financial instruments — — 63,396
Other, net 3,323 22,815 28,757
1 unchanged sentence
Cash flows from investing activities:
−Removed: Contributions to subsidiaries — — —
Distributions from subsidiaries 342,087 170,620 108,783
1 unchanged sentence
Cash flows from financing activities:
−Removed: Proceeds from issuance of common stock, net of expenses — — 1,180,000
Dividends on common stock ( 186,774 ) ( 182,266 ) ( 128,587 )
6 unchanged sentences
Ending balance $ 1,263 $ 1,861 $ 1,118
−Removed: Supplementary cash flow information:
−Removed: Issuance of shares for acquisition of business $ — $ — $ 55,485
The accompanying notes are an integral part of these condensed financial statements
16 unchanged sentences
made non-cash contributions to subsidiaries of approximately $ 55 million and $ 49 million, respectively, primarily related to the transfer of net assets of certain subsidiaries for share-based compensation (including amounts related to discontinued operations).
−Removed: As of December 31, 2024, current liabilities includes $ 104 million related to the December 2024 agreement with a non-affiliate to repurchase shares, in which the transaction closed in January 2025, and other liabilities includes intercompany liabilities with subsidiaries of $ 240 million related to share repurchases under the 2024 Share Repurchase Plan.
+Added: As of December 31, 2025, other liabilities includes intercompany liabilities related to share repurchases of $ 607 million under the 2025 Share Repurchase Plan.
+Added: As of December 31, 2024, current liabilities includes $ 104 million related to the December 2024 agreement with a non-affiliate to repurchase shares, in which the transaction closed in January 2025, and other liabilities includes intercompany liabilities related to share repurchases of $ 240 million under the 2024 Share Repurchase Plan.
Subsequent event - In January 2026, ADT Inc.
−Removed: received distributions from subsidiaries of $ 47 million to pay dividends that the Company declared in October 2024 to common shareholders.
−Removed: SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
−Removed: The Company is disclosing the following summarized quarterly financial information for 2024 and 2023 due to the Solar and Commercial Businesses being reported as discontinued operations as a result of the ADT Solar Exit and Commercial Divestiture, respectively.
−Removed: Refer to Note 4 “Divestitures” for additional information.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in thousands, except per share data)
−Removed: March 31, 2024 June 30,
−Removed: September 30, 2024 December 31, 2024
−Removed: $ 1,189,672 $ 1,204,559 $ 1,243,836 $ 1,260,379
−Removed: Operating income (loss)
−Removed: $ 292,149 $ 284,175 $ 326,350 $ 305,390
−Removed: Income (loss) from continuing operations
−Removed: $ 163,891 $ 126,185 $ 132,020 $ 197,294
−Removed: Income (loss) from discontinued operations, net of tax $ ( 72,340 ) $ ( 33,791 ) $ ( 4,869 ) $ ( 7,337 )
−Removed: Net income (loss) $ 91,551 $ 92,394 $ 127,151 $ 189,957
−Removed: Weighted average shares outstanding
−Removed: 855,893 848,273 850,462 831,575
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.18 $ 0.14 $ 0.15 $ 0.22
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.08 ) $ ( 0.04 ) $ ( 0.01 ) $ ( 0.01 )
−Removed: Net income (loss) $ 0.10 $ 0.10 $ 0.14 $ 0.21
−Removed: Weighted average shares outstanding
−Removed: 918,394 909,128 912,861 895,035
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.17 $ 0.13 $ 0.14 $ 0.21
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.07 ) $ ( 0.03 ) $ ( 0.01 ) $ ( 0.01 )
−Removed: Net income (loss) $ 0.09 $ 0.10 $ 0.13 $ 0.20
−Removed: Class B Common Stock
−Removed: Weighted average shares outstanding
−Removed: 54,745 54,745 54,745 54,745
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.18 $ 0.14 $ 0.15 $ 0.22
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.08 ) $ ( 0.04 ) $ ( 0.01 ) $ ( 0.01 )
−Removed: Net income (loss) $ 0.10 $ 0.10 $ 0.14 $ 0.21
−Removed: Weighted average shares outstanding
−Removed: 54,745 54,745 54,745 54,745
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.17 $ 0.13 $ 0.14 $ 0.21
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.07 ) $ ( 0.03 ) $ ( 0.01 ) $ ( 0.01 )
−Removed: Net income (loss) $ 0.09 $ 0.10 $ 0.13 $ 0.20
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in thousands, except per share data)
−Removed: March 31, 2023 June 30,
−Removed: September 30, 2023 December 31, 2023
−Removed: $ 1,132,476 $ 1,168,077 $ 1,179,873 $ 1,172,398
−Removed: Operating income (loss)
−Removed: $ 232,960 $ 332,098 $ 306,563 $ 307,340
−Removed: Income (loss) from continuing operations
−Removed: $ 39,563 $ 180,438 $ 123,259 $ 107,110
−Removed: Income (loss) from discontinued operations, net of tax $ ( 158,400 ) $ ( 88,227 ) $ ( 209,496 ) $ 468,762
−Removed: Net income (loss) $ ( 118,837 ) $ 92,211 $ ( 86,237 ) $ 575,872
−Removed: Weighted average shares outstanding
−Removed: 854,299 857,581 857,423 858,094
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.04 $ 0.20 $ 0.13 $ 0.12
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.17 ) $ ( 0.10 ) $ ( 0.23 ) $ 0.51
−Removed: Net income (loss) $ ( 0.13 ) $ 0.10 $ ( 0.09 ) $ 0.63
−Removed: Weighted average shares outstanding
−Removed: 921,606 916,859 917,774 919,397
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.04 $ 0.19 $ 0.13 $ 0.11
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.16 ) $ ( 0.09 ) $ ( 0.21 ) $ 0.48
−Removed: Net income (loss) $ ( 0.12 ) $ 0.09 $ ( 0.09 ) $ 0.59
−Removed: Class B Common Stock
−Removed: Weighted average shares outstanding
−Removed: 54,745 54,745 54,745 54,745
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.04 $ 0.20 $ 0.13 $ 0.12
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.17 ) $ ( 0.10 ) $ ( 0.23 ) $ 0.51
−Removed: Net income (loss) $ ( 0.13 ) $ 0.10 $ ( 0.09 ) $ 0.63
−Removed: Weighted average shares outstanding
−Removed: 54,745 54,745 54,745 54,745
−Removed: Income (loss) from continuing operations per share
−Removed: $ 0.04 $ 0.19 $ 0.13 $ 0.11
−Removed: Income (loss) from discontinued operations, net of tax, per share
−Removed: $ ( 0.16 ) $ ( 0.09 ) $ ( 0.21 ) $ 0.48
−Removed: Net income (loss) $ ( 0.12 ) $ 0.09 $ ( 0.09 ) $ 0.59
+Added: received distributions from subsidiaries of $ 44 million to pay dividends that the Company declared in November 2025 to common shareholders.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.