Alarm.com Holdings, Inc. Q2 FY2025 earnings call

• Q2 financial results were above expectations with SaaS and license revenue at $170 million and adjusted EBITDA at $48.4 million.
• Celebrated 10th year as a publicly traded company, invited by NASDAQ to ring in the market opening on June 30.
• Residential business continued steady growth and strong cash flow; remains committed to the large U.S. and Canadian residential market.
• Growth initiatives (commercial, international, EnergyHub) continued to drive SaaS revenue growth, contributing nearly 30% to total SaaS revenue.
• OpenEye, a subsidiary, introduced new AI-powered tools for forensic video review in its premium services tier.
• Completed minority investments to strengthen the national sales and service footprint.

In the second quarter, SaaS and license revenue grew to $170 million. Total revenue was $254.3 million, marking a milestone with an annual run rate exceeding $1 billion. The growth initiatives (commercial, EnergyHub, international) contributed nearly 30% to SaaS revenue. Historically, gross profits from hardware sales cover over 50% of sales and marketing customer acquisition costs.

• For Q3 2025, forecasted SaaS and license revenue is $171.4 million to $171.6 million.
• Full-year 2025 SaaS and license revenue raised to $681 million to $681.4 million, total revenue to $990 million to $996.4 million, non-GAAP adjusted EBITDA to $195 million to $196.5 million, and non-GAAP adjusted net income to $136 million to $136.5 million.
• Non-GAAP tax rate for 2025 expected to remain at 21% under current tax rules.
• Full-year 2025 stock-based compensation expense projected at $37 million to $38 million.

• Uncertainty around tariffs, including potential pass-through of costs and impact on margins. The company is monitoring trade frameworks but believes current inventory and products in transit insulate 2025 outlook based on seen frameworks.

Q: Thoughts on home sales picking up in 2026 and percentage of customers with multiple properties?

A: Steve Trundle said housing market is sensitive to interest rate discussions, with service providers feeling slightly more positive about next 6 months. On multiple properties, a high percentage of commercial customers have multiple properties, and a meaningful percentage of residential customers do too.

Q: Any plans for general price hikes on SaaS services?

A: Kevin Bradley said there are no current expectations for broad-based service price increases in the second half of 2025 or 2026.

Q: Which international regions are growing fastest?

A: Steve Trundle said Lat Am and the Middle East are growing faster, with Lat Am showing faster growth and the Middle East having fast adoption of remote video monitoring.