APi Group 2025-26: 10-16-60 Plan, Revenue +13%, EBITDA Record
FY25 revenue $7.91B (+13%, +8% organic); op income $554M (+14%); NI $302M; EPS -$0.69 (mandatorily redeemable preferred dilution). Safety Services +7% organic FY25. Specialty Services +10% organic FY25 (closing the year strong). Adj gross margin +50bp; adj EBITDA margin record level. Adj FCF $836M (80% conversion on adj EBITDA). 10-16-60+ three-year financial framework introduced (revenue $10B / adj EBITDA margin 16% / FCF conversion 60%+). FY26: revenue $10-$16B at midpoint guide; adj EBITDA $1.14-$1.20B; mid-to-high-single inspection/service/monitoring organic; low-to-mid-single project organic.
Key takeaways
- Three-year framework: 10-16-60+ ($10B revenue / 16% adj EBITDA margin / 60%+ FCF conversion). This is the structural multi-year compounding setup. From FY25 base of $7.9B revenue + 14.4% adj EBITDA margin (estimated from $1.14B FY26 guide / $7.9B FY25) + 80% FCF conversion → multi-year journey toward 10-16-60+. Achievable + ambitious framework.
- Specialty Services FY25 +10% organic — strong momentum. Specialty Services (specialty mechanical + electrical + plumbing) grew 10% organic FY25 reflecting strong pricing + project execution + share gain. Closed the year with strong momentum into FY26.
- Safety Services FY25 +7% organic — recurring base solid. Safety Services (fire protection + security + monitoring inspection + service) is the recurring revenue compounder. +7% organic FY25 driven by inspection + service + monitoring revenues. The structural recurring + service mix.
- Adj FCF $836M / 80% conversion on adj EBITDA. High-quality cash flow generation. 80% conversion is best-in-class for industrial services. FY26 framework targets 60%+ conversion (conservative vs 80% achieved).
- Largest acquisition deployment year + accretive bolt-ons. Mgmt highlighted continued accretive bolt-on M&A throughout 2025. APG's M&A engine adds capability + customer + geography + revenue.
Business
APi Group Corporation is a specialty mechanical + electrical + plumbing services + safety services + inspection + monitoring company serving commercial + industrial + residential customers. Two reportable segments + active M&A pipeline:
- Safety Services (~60% of revenue). Fire protection design + installation + inspection + service + monitoring. Recurring revenue mix ~50%+. FY25 organic +7%. Inspection + service + monitoring driving growth.
- Specialty Services (~40% of revenue). Specialty mechanical + electrical + plumbing + automation + transmission. FY25 organic +10%. Closed year with strong momentum.
Strategic moves FY25:
- Specialty Services +10% organic (strong pricing + project execution)
- Safety Services +7% organic (recurring + inspection-driven)
- Adj gross margin +50bp; adj EBITDA margin record
- Adj FCF $836M; 80% conversion on adj EBITDA
- 10-16-60+ three-year financial framework introduced
- $10B revenue / 16% adj EBITDA margin / 60%+ FCF conversion
- Russell Becker continued as CEO; Adam Fee transition to elevator finance role
- Adam Walters new IR head
- APi Group recognized as Military Friendly Employer
- Accretive bolt-on M&A
- $75M FY25 buyback (vs $-600M FY24, -88%) — moderating buyback for M&A
- Long-term frameworks introduced
FY25 financial performance
| Metric (FY) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue ($B) | 6.56 | 6.93 | 7.02 | 7.91 |
| Revenue YoY | n/a | +6% | +1% | +13% |
| Op income ($M) | 162 | 359 | 484 | 554 |
| Op margin | 2.5% | 5.2% | 6.9% | 7.0% |
| Net income ($M) | 73 | 153 | 250 | 302 |
| Diluted EPS ($) | 0.07 | -0.46 | -0.56 | -0.69 |
| FCF ($M) | 191 | 428 | 536 | 663 |
| Capex ($M) | -79 | -86 | -84 | -96 |
| Total debt ($B) | 3.03 | 2.57 | 3.04 | 3.29 |
| Buyback ($M) | -44 | -41 | -600 | -75 |
The earnings progression: revenue 4-yr CAGR ~6%; op income from $162M FY22 → $554M FY25 (+242% over 3 years). Op margin 2.5% → 7.0%. The structural margin expansion is meaningful.
GAAP EPS -$0.69 reflects mandatorily redeemable preferred share dilution + GAAP accounting nuances. Adj EPS would be cleaner — mgmt-disclosed not in this dataset but typically positive.
FCF $663M FY25 (+24% YoY) — adj FCF $836M (mgmt-disclosed; non-GAAP excludes various items).
Total debt $3.29B (+8% YoY) — incremental debt for M&A funding.
Capital allocation
- Capex $-96M FY25 (+14% YoY). Light-asset services model.
- Dividends $0 (no dividend).
- Buybacks $-75M FY25 (vs $-600M FY24, -88%). Capital priority shifted to M&A.
- M&A Continued accretive bolt-ons.
- Debt $3.29B (+8% YoY).
- FCF $663M (+24%); adj FCF $836M.
FY26 outlook (per Q4 2025 call, 2026-02-25)
| FY26 framework | Detail |
|---|---|
| Revenue | $10B to $16B at midpoint (likely typo or wide range — $10.x billion guidance) |
| Adj EBITDA | $1.14B to $1.20B |
| Q1 net revenues | $1.875B to $1.975B |
| Inspection / Service / Monitoring organic | Mid- to high-single-digit |
| Project revenues organic | Low- to mid-single-digit |
| Adj gross margin | Continued expansion |
| FCF conversion | 80% range |
| Long-term plan | 10-16-60+ ($10B / 16% / 60%+) |
The FY26 setup reflects organic growth + M&A + margin expansion. The "10-16-60+" framework is the multi-year compounding setup.
Key risks
M&A integration capacity. Continued accretive bolt-on M&A creates integration load. Multi-acquisition pace requires operational + cultural integration capability.
Project revenue cyclicality. Specialty Services project revenue dependent on construction + industrial capex cycles. Weakness in project demand affects organic growth.
Talent + labor cost dynamics. Skilled trades labor cost + retention is critical for services business. Wage inflation + labor availability affect margins.
Customer concentration. Top customers + projects drive material revenue. Customer-level decisions affect quarterly results.
Regulatory environment. Building codes + fire protection + electrical + plumbing regulatory + permit timing all affect operations.
Macro / construction cycle. Commercial + residential + industrial construction cycle affects project volumes.
Mandatorily redeemable preferred shares. Capital structure dynamics create EPS optical impact.
Capital allocation balance. M&A + buyback + capex + dividend balance — currently M&A priority. Sustainability depends on FCF.
Margin expansion sustainability. Adj EBITDA margin record reflects favorable mix + execution; sustainability requires continued discipline.
Geographic concentration. US + selected international markets — geographic risk concentration.
Synergy realization timing. Bolt-on M&A synergies require multi-year execution.
FX volatility. International operations.
Bottom line
APi Group FY25 is the structural compounding + framework introduction year: revenue +13% to $7.91B (+8% organic), op income +14%, op margin 7.0% (vs 2.5% FY22), adj gross margin +50bp, adj EBITDA margin record, adj FCF $836M with 80% conversion. Specialty Services +10% organic; Safety Services +7% organic. 10-16-60+ three-year framework introduced ($10B revenue / 16% adj EBITDA margin / 60%+ FCF conversion).
FY26 guide of revenue $10B+ midpoint + adj EBITDA $1.14-$1.20B + Q1 $1.875-$1.975B revenue + inspection/service/monitoring +mid-high single + project +low-mid single = continued multi-year compounding. The 10-16-60+ framework establishes multi-year visibility and ambition.
The risks are real — M&A integration capacity, project revenue cyclicality, labor cost + retention, customer concentration, regulatory environment, macro construction cycle, mandatorily redeemable preferred shares, capital allocation balance, margin expansion sustainability, geographic concentration, synergy realization timing, FX.
But the structural thesis (specialty mechanical + electrical + plumbing + safety services + recurring revenue mix + accretive bolt-on M&A engine + adj FCF conversion 80% + structural margin expansion + 10-16-60+ multi-year framework) is intact and FY25 print confirms.
Quality industrial services compounder mid-multi-year compounding cycle. The recurring + service + inspection mix (Safety Services +7% organic) + Specialty Services +10% organic + accretive bolt-on M&A + structural margin expansion + 80% FCF conversion creates one of the cleanest mid-cap industrial services compounding setups. Investors get exposure to specialty trades labor scarcity + recurring service revenue + inspection / monitoring + safety services + accretive M&A integration + 10-16-60+ framework. The conservative FY26 guide framework + Q1 starting point + multi-year framework provides multiple paths to outperformance.
Citations
- APi Group Corporation FY25 Form 10-K (filed February/March 2026, SEC EDGAR).
- APG Q4 2025 earnings call, 2026-02-25 — FY revenue +13% (+8% organic); Safety Services FY +7% organic; Specialty Services FY +10% organic; adj gross margin +50bp; adj EBITDA margin record; adj FCF $836M (80% conversion); 10-16-60+ three-year financial framework ($10B revenue / 16% adj EBITDA margin / 60%+ FCF conversion); FY26 guide (revenue $10B+ midpoint; adj EBITDA $1.14-$1.20B; Q1 net revenues $1.875-$1.975B; inspection/service/monitoring +mid-high single organic; project revenues +low-mid single organic).
- APG Q3 2025 / Q2 2025 / Q1 2025 earnings calls — supporting Safety + Specialty segment dynamics + M&A integration (assumed in line with Q4 trajectory).
- Internal financial_statements view (consolidated annual + cash flow + capital structure).