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Alarm.com Reports Third Quarter 2024 Results

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Alarm.com (ALRM) reported strong Q3 2024 results with significant growth across key metrics. SaaS and license revenue increased 9.8% to $159.3 million, while total revenue grew 8.4% to $240.5 million. GAAP net income surged 87.9% to $36.7 million. The company's cash position strengthened to $1.17 billion, boosted by a $500 million convertible notes offering. Notable business developments include the launch of OpenEye Cloud Cameras, AI-Deterrence capability, and Smart Thermostat HQ. The company increased its full-year 2024 guidance, expecting SaaS and license revenue between $628.7-628.9 million.

Alarm.com (ALRM) ha riportato risultati solidi nel terzo trimestre del 2024, con una crescita significativa in metriche chiave. I ricavi SaaS e da licenze sono aumentati del 9,8% a 159,3 milioni di dollari, mentre i ricavi totali sono cresciuti dell'8,4% a 240,5 milioni di dollari. Il reddito netto GAAP è aumentato del 87,9% a 36,7 milioni di dollari. La posizione di cassa dell'azienda è migliorata, raggiungendo 1,17 miliardi di dollari, sostenuta da un'offerta di obbligazioni convertibili da 500 milioni di dollari. Tra gli sviluppi aziendali significativi vi sono il lancio delle OpenEye Cloud Cameras, la capacità di AI-Deterrence e il Smart Thermostat HQ. L'azienda ha aumentato le sue previsioni per l'intero anno 2024, prevedendo ricavi SaaS e da licenze tra 628,7 e 628,9 milioni di dollari.

Alarm.com (ALRM) reportó resultados fuertes en el tercer trimestre de 2024, con un crecimiento significativo en métricas clave. Los ingresos de SaaS y licencias aumentaron un 9,8% a 159,3 millones de dólares, mientras que los ingresos totales crecieron un 8,4% a 240,5 millones de dólares. El ingreso neto GAAP se disparó un 87,9% a 36,7 millones de dólares. La posición de efectivo de la compañía se fortaleció a 1,17 mil millones de dólares, impulsada por una oferta de notas convertibles de 500 millones de dólares. Entre los desarrollos empresariales notables se incluyen el lanzamiento de OpenEye Cloud Cameras, la capacidad de AI-Deterrence y el Smart Thermostat HQ. La empresa confirmó su guía para todo el año 2024, esperando ingresos de SaaS y licencias entre 628,7 y 628,9 millones de dólares.

Alarm.com (ALRM)은 2024년 3분기 강력한 실적을 보고하며 주요 지표에서 상당한 성장을 기록했습니다. SaaS 및 라이선스 수익은 9.8% 증가하여 1억 5,930만 달러에 이르렀고, 총 수익은 8.4% 증가하여 2억 4,050만 달러에 달했습니다. GAAP 순이익은 87.9% 급증하여 3,670만 달러에 도달했습니다. 회사의 현금 잔고는 10억 1,700만 달러로 강화되었으며, 5억 달러 규모의 전환사채 발행에 힘입은 바 큽니다. 주목할 만한 사업 발전으로는 OpenEye Cloud Cameras의 출시, AI-Deterrence 기능, Smart Thermostat HQ 발매가 포함됩니다. 회사는 2024년 전체 연도 가이드를 상향 조정하며 SaaS 및 라이선스 수익이 6억 2,870만 달러에서 6억 2,890만 달러 사이가 될 것으로 예상하고 있습니다.

Alarm.com (ALRM) a rapporté de solides résultats pour le troisième trimestre 2024, avec une croissance significative sur des indicateurs clés. Les revenus SaaS et de licences ont augmenté de 9,8 % pour atteindre 159,3 millions de dollars, tandis que le chiffre d'affaires total a crû de 8,4 % pour atteindre 240,5 millions de dollars. Le revenu net selon le principe GAAP a bondi de 87,9 % pour atteindre 36,7 millions de dollars. La position de liquidité de l'entreprise s'est renforcée pour atteindre 1,17 milliard de dollars, soutenue par une offre d'obligations convertibles de 500 millions de dollars. Parmi les développements d'affaires notables figurent le lancement des OpenEye Cloud Cameras, la capacité de l'AI-Deterrence et le Smart Thermostat HQ. L'entreprise a augmenté ses prévisions pour l'ensemble de l'année 2024, s'attendant à des revenus SaaS et de licences compris entre 628,7 et 628,9 millions de dollars.

Alarm.com (ALRM) hat starke Ergebnisse für das dritte Quartal 2024 berichtet, mit signifikantem Wachstum in wichtigen Kennzahlen. Umsätze aus SaaS und Lizenzen stiegen um 9,8% auf 159,3 Millionen US-Dollar, während der Gesamtumsatz um 8,4% auf 240,5 Millionen US-Dollar wuchs. Der GAAP-Nettoeinkommen erhöhte sich um 87,9% auf 36,7 Millionen US-Dollar. Die Liquidität des Unternehmens stärkete sich auf 1,17 Milliarden US-Dollar, begünstigt durch ein Angebot von 500 Millionen US-Dollar an wandelbaren Anleihen. Zu den bemerkenswerten Geschäftsentwicklungen gehören die Einführung der OpenEye Cloud Cameras, die AI-Deterrence-Funktion und das Smart Thermostat HQ. Das Unternehmen hat seine Prognose für das gesamte Jahr 2024 angehoben und erwartet, dass die SaaS- und Lizenzumsätze zwischen 628,7 und 628,9 Millionen US-Dollar liegen werden.

Positive
  • SaaS and license revenue grew 9.8% YoY to $159.3 million
  • GAAP net income increased 87.9% YoY to $36.7 million
  • Non-GAAP adjusted EBITDA rose 20.6% to $50.0 million
  • Cash position strengthened to $1.17 billion from $697.0 million
  • Operating cash flow improved to $150.2 million from $96.1 million YoY
Negative
  • Incurred $14.8 million in debt issuance costs for convertible notes
  • Spent $75.0 million on share repurchases at $67.14 per share

Insights

The Q3 results demonstrate robust financial performance with multiple positive indicators. SaaS and license revenue grew 9.8% to $159.3 million, while GAAP net income showed impressive growth of 87.9% to $36.7 million. The company's cash position strengthened significantly to $1.17 billion, partly due to the successful placement of convertible notes.

Key growth metrics and operational efficiency are evident in the 20.6% increase in adjusted EBITDA and improved cash flows from operations. The company's strategic product launches in AI-powered security and smart home solutions position it well for continued growth. The raised full-year guidance suggests management's confidence in sustained performance through Q4.

The product launches demonstrate Alarm.com's strategic focus on high-growth market segments. The new OpenEye Cloud Cameras with AI capabilities address the evolving commercial security market, while the AI-Deterrence feature showcases innovation in proactive security. The Smart Thermostat HQ's integrated hub approach is particularly noteworthy for its potential to capture market share in the building and property management sectors.

These innovations align with industry trends toward AI-driven security solutions and integrated smart building management, positioning Alarm.com competitively in both residential and commercial markets.

-- Third quarter SaaS and license revenue increased 9.8% to $159.3 million, compared to $145.0 million for the third quarter of 2023 --

-- Third quarter GAAP net income attributable to common stockholders increased 87.9% to $36.7 million, compared to $19.5 million for the third quarter of 2023 --

-- Third quarter non-GAAP adjusted EBITDA increased 20.6% to $50.0 million, compared to $41.4 million for the third quarter of 2023 --

TYSONS, Va.--(BUSINESS WIRE)-- Alarm.com Holdings, Inc. (Nasdaq: ALRM), the leading platform for the intelligently connected property, today reported financial results for its third quarter ended September 30, 2024. Alarm.com also provided its financial outlook for SaaS and license revenue for the fourth quarter of 2024 and increased its guidance for the full year of 2024.

Third Quarter 2024 Financial Results as Compared to Third Quarter 2023

  • SaaS and license revenue increased 9.8% to $159.3 million, compared to $145.0 million.
  • Total revenue increased 8.4% to $240.5 million, compared to $221.9 million.
  • GAAP net income attributable to common stockholders increased 87.9% to $36.7 million, or $0.67 per diluted share, compared to $19.5 million, or $0.37 per diluted share.
  • Non-GAAP adjusted EBITDA(*) increased 20.6% to $50.0 million, compared to $41.4 million.
  • Non-GAAP adjusted net income attributable to common stockholders(*) increased 14.9% to $35.2 million, or $0.62 per diluted share, compared to $30.6 million, or $0.56 per diluted share.

Balance Sheet and Cash Flow

  • Total cash and cash equivalents increased to $1.17 billion as of September 30, 2024, compared to $697.0 million as of December 31, 2023. The increase in cash and cash equivalents was primarily due to the May 2024 issuance of $500.0 million aggregate principal amount of 2.25% convertible senior notes due June 1, 2029 in a private placement to qualified institutional buyers, or the 2029 Notes, resulting in proceeds of $485.2 million, net of $14.8 million of transaction fees and other debt issuance costs, and to a lesser extent, positive cash flows.
    • In connection with the offering of the 2029 Notes, Alarm.com used $63.1 million of the net proceeds from the 2029 Notes to pay the cost of privately negotiated capped call transactions to cover the number of shares of Alarm.com's common stock initially underlying the 2029 Notes. Alarm.com also used $75.0 million to repurchase 1,117,068 shares of its common stock at a per share price of $67.14 concurrently with the pricing of the 2029 Notes.
  • For the nine months ended September 30, 2024, cash flows from operations was $150.2 million, compared to $96.1 million for the nine months ended September 30, 2023. For the nine months ended September 30, 2024, non-GAAP free cash flow(*) was $142.3 million, compared to $90.7 million for the nine months ended September 30, 2023.

(*) Reconciliations of the non-GAAP measures are set forth at the end of this press release.

Recent Business Highlights

  • OpenEye Launches New Line of Cloud Cameras: OpenEye’s new all-in-one video camera solution provides a cost-effective and flexible option for commercial integrators to quickly deploy advanced video analytics capabilities. With a cloud-based architecture, self-contained storage and onboard AI processing, Cloud Cameras can easily scale and flexibly address the diverse requirements of commercial customers. Offered as a subscription-based solution, OpenEye Cloud Cameras fully leverage the suite of management, analytics, alerting and reporting tools offered by the OpenEye platform.
  • Introduced New Gen-AI Deterrence Capability for Video Monitoring: Alarm.com’s new AI-Deterrence (AID) capability works with select outdoor video cameras and can identify and automatically engage potential intruders with a neural synthesized voice. AID adds a cost-effective advanced layer of proactive security to Alarm.com's Remote Video Monitoring solution that enables Alarm.com’s partners to provide professional video monitoring and event response.
  • Launched New Smart Thermostat: The Smart Thermostat HQ includes a built-in, cellular-based smart hub that supports devices such as light switches, water protection sensors, sump pump monitors and other Z-Wave devices. It offers the full range of Alarm.com’s energy-saving capabilities as well as intelligent HVAC monitoring capabilities that detect system issues and automatically connect subscribers to a certified HVAC service provider. Smart Thermostat HQ is designed to provide an easy-to-install solution for home builders, multi-family properties and other market segments that require cost-effective property protection and awareness solutions.

Financial Outlook

Alarm.com is providing its outlook for SaaS and license revenue for the fourth quarter of 2024 and increasing its guidance for the full year of 2024 based upon current management expectations.

For the fourth quarter of 2024:

  • SaaS and license revenue is expected to be in the range of $163.2 million to $163.4 million.

For the full year 2024:

  • SaaS and license revenue is expected to be in the range of $628.7 million to $628.9 million.
  • Total revenue is expected to be in the range of $933.7 million to $935.9 million, which includes anticipated hardware and other revenue in the range of $305.0 million to $307.0 million.
  • Non-GAAP adjusted EBITDA is expected to be in the range of $174.0 million to $176.0 million.
  • Non-GAAP adjusted net income attributable to common stockholders is expected to be in the range of $125.5 million to $126.5 million, based on an estimated tax rate of 21.0%.
  • Based on an expected 57.9 million weighted average diluted shares outstanding, non-GAAP adjusted net income attributable to common stockholders is expected to be $2.25 to $2.27 per diluted share.

The 2024 guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. The guidance provided above is based on expectations as of the date of this press release and Alarm.com undertakes no obligation to update guidance after such date.

Conference Call and Webcast Information

Alarm.com will host a conference call to discuss its third quarter 2024 financial results and its outlook for the fourth quarter and full year 2024. A live audio webcast is scheduled to begin at 4:30 p.m. ET on November 7, 2024. To participate on the live call, analysts and investors should pre-register to obtain a dial-in number and individual passcode by visiting: https://register.vevent.com/register/BI36bc8a3a1e2b4db2b5909bebc12ebb90. Alarm.com will also offer a live and archived webcast of the conference call accessible on Alarm.com’s Investor Relations website at http://investors.alarm.com. The information contained on any referenced website is not incorporated herein.

About Alarm.com Holdings, Inc.

Alarm.com is the leading platform for the intelligently connected property. Millions of consumers and businesses depend on Alarm.com's technology to manage and control their property from anywhere. Our platform integrates with a growing variety of Internet of Things devices through our apps and interfaces. Our security, video, access control, intelligent automation, energy management, and wellness solutions are available through our network of thousands of professional service providers in North America and around the globe. Alarm.com's common stock is traded on Nasdaq under the ticker symbol ALRM. For more information, please visit www.alarm.com.

Non-GAAP Financial Measures

To supplement our consolidated selected financial data presented on a basis consistent with GAAP, this press release contains certain non-GAAP financial measures, including non-GAAP adjusted EBITDA, non-GAAP adjusted income before income taxes, non-GAAP adjusted net income, non-GAAP adjusted income attributable to common stockholders before income taxes, non-GAAP adjusted net income attributable to common stockholders, non-GAAP adjusted net income attributable to common stockholders per share and non-GAAP free cash flow. We have included non-GAAP measures in this press release because they are financial, operating or liquidity measures used by our management to (i) understand and evaluate our core operating performance and trends and generate future operating plans, (ii) make strategic decisions regarding the allocation of capital and investments in initiatives that are focused on cultivating new markets for our solutions and (iii) provide useful information to management about the amount of cash generated by the business after necessary capital expenditures. We also use non-GAAP adjusted EBITDA as a performance measure under our executive bonus plan. Further, we believe that these non-GAAP measures of our financial results provide useful information to investors and others in understanding and evaluating our results of operations, business trends and financial condition. While we believe the use of these non-GAAP measures provides useful information to investors and management in analyzing our financial performance, non-GAAP measures have inherent limitations in that they do not reflect all of the amounts and transactions that are included in our financial statements prepared in accordance with GAAP. Non-GAAP measures do not serve as an alternative to GAAP nor do we consider our non-GAAP measures in isolation. Accordingly, we present non-GAAP financial measures only in connection with GAAP results. We urge investors to consider non-GAAP measures only in conjunction with our GAAP financials and to review the reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measures, which are included in this press release.

We consider non-GAAP free cash flow to be a liquidity measure, which we define as cash flows from operating activities less purchases of property and equipment.

With respect to our expectations under “Financial Outlook” above, reconciliation of non-GAAP adjusted EBITDA and non-GAAP adjusted net income attributable to common stockholders guidance to the closest corresponding GAAP measure is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures. In particular, non-ordinary course litigation expense, acquisition-related expense and tax windfall adjustments can have unpredictable fluctuations based on unforeseen activity that is out of our control and/or cannot reasonably be predicted. We expect the above charges to have a significant and potentially highly variable impact on our future GAAP financial results.

We exclude one or more of the following items from non-GAAP financial and operating measures:

Interest expense: We record interest expense primarily related to the January 2021 issuance of $500.0 million aggregate principal amount of 0% convertible senior notes due January 15, 2026, or the 2026 Notes, and the 2029 Notes. We exclude interest expense in calculating our non-GAAP adjusted EBITDA. For non-GAAP adjusted net income, non-GAAP adjusted net income attributable to common stockholders and non-GAAP adjusted net income attributable to common stockholders per share, basic and diluted, we do not exclude interest expense other than the interest expense related to the amortization of debt issuance costs related to the 2026 Notes and 2029 Notes as discussed below.

Interest income and certain activity within other expense, net: We exclude interest income as well as certain activity within other expense, net including gains, losses or impairments on investments without readily determinable fair values and other assets, gains on settlement fees as well as losses on the early extinguishment of the debt, when applicable, from our non-GAAP financial measures because we do not consider it part of our ongoing results of operations.

Provision for income taxes: We exclude the impact related to our provision for income taxes from our non-GAAP adjusted EBITDA calculation. We do not consider this tax adjustment to be part of our ongoing results of operations.

Amortization expense: GAAP requires that operating expenses include the amortization of acquired intangible assets, which principally include acquired customer relationships, developed technology and trade names. We exclude amortization of intangibles from our non-GAAP financial measures because we do not consider amortization expense when we evaluate our ongoing business operations, nor do we factor amortization expense into our evaluation of potential acquisitions, or our measurement of the performance of those acquisitions. We believe that the exclusion of amortization expense enables the comparison of our performance to other companies in our industry as other companies may be more or less acquisitive than we are and therefore, amortization expense may vary significantly by company based on their acquisition history. Although we exclude amortization of acquired intangible assets from our non-GAAP financial measures, management believes that it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation.

Depreciation expense: We record depreciation primarily for investments in property and equipment. We exclude depreciation in calculating non-GAAP adjusted EBITDA because we do not consider depreciation when we evaluate our ongoing business operations. For non-GAAP adjusted net income, non-GAAP adjusted net income attributable to common stockholders and non-GAAP adjusted net income attributable to common stockholders per share, basic and diluted, we do not exclude depreciation.

Amortization of debt issuance costs: We record amortization of debt issuance costs related to the 2026 Notes and 2029 Notes as interest expense. We exclude amortization of debt issuance costs from our non-GAAP adjusted net income, non-GAAP adjusted net income attributable to common stockholders and non-GAAP adjusted net income attributable to common stockholders per share, basic and diluted, because we believe that the exclusion of this non-cash interest expense will provide for more meaningful information about our financial performance.

Stock-based compensation expense: We exclude stock-based compensation expense, which relates to restricted stock units and other forms of equity incentives primarily awarded to employees of Alarm.com, because they are non-cash charges that we do not consider when assessing the operating performance of our business. Additionally, the determination of stock-based compensation expense can be calculated using various methodologies and is dependent upon subjective assumptions and other factors that vary on a company-by-company basis. Therefore, we believe that excluding stock-based compensation expense from our non-GAAP financial measures improves the comparability of our results to the results of other companies in our industry.

Acquisition-related expense: Included in operating expenses are incremental costs directly related to business and asset acquisitions as well as changes in the fair value of contingent consideration liabilities, when applicable. We exclude acquisition-related expense from our non-GAAP financial measures because we believe that the exclusion of this expense allows us to better provide meaningful information about our operating performance, facilitates comparisons to our historical operating results, improves the comparability of our results to the results of other companies in our industry, and ultimately, we believe helps investors better understand the acquisition-related expense and the effects of the transaction on our results of operations.

Litigation expense: We exclude non-ordinary course litigation expense because we do not consider legal costs and settlement fees incurred and received in litigation and litigation-related matters of non-ordinary course lawsuits and other disputes, particularly costs incurred in ongoing intellectual property litigation, to be indicative of our core operating performance. We do not adjust for ordinary course legal expenses, including those expenses resulting from maintaining and enforcing our intellectual property portfolio and license agreements.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “designed,” “enable,” “ensure,” “expect,” “intend,” “will,” and other similar terms and phrases, and such forward-looking statements include, but are not limited to, the statements regarding the Company’s opportunities, positioning, the benefits of recently launched offerings, acquisitions and investments, and the Company’s guidance for the fourth quarter and full year 2024 described under “Financial Outlook” above and key assumptions related thereto. The events described in these forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including, but not limited to: impact of the global economic uncertainty and financial market conditions caused by significant worldwide events, including public health crises, geopolitical upheaval, such as Russia’s incursion into Ukraine and the conflict between Israel and regional adversaries, supply chain disruptions, interest rates and inflation (collectively, Macroeconomic Conditions); impact of Macroeconomic Conditions and their economic effects on demand for the Company's products; the reliability of the Company’s network operations centers; the Company’s ability to retain service provider partners and residential and commercial subscribers and sustain its growth rate; the Company’s ability to manage growth and execute on its business strategies; the effects of increased competition and evolving technologies; the Company’s ability to integrate acquired assets and businesses and to manage service provider partners, customers and employees; consumer demand for interactive security, video monitoring, intelligent automation, energy management and wellness solutions; the Company’s reliance on its service provider network to attract new customers and retain existing customers; the Company's dependence on its suppliers; the potential loss of any key supplier or the inability of a key supplier to deliver their products to us on time or at the contracted price; the reliability of the Company’s hardware and wireless network suppliers and enhanced United States tax, tariff, import/export restrictions, or other trade barriers, particularly tariffs from China; and other risks and uncertainties discussed in the “Risk Factors” section of the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 8, 2024 and other subsequent filings the Company makes with the Securities and Exchange Commission from time to time, including its Form 10-Q for the quarter ended September 30, 2024. In addition, the forward-looking statements included in this press release represent the Company’s views and expectations as of the date hereof and are based on information currently available to the Company. The Company anticipates that subsequent events and developments may cause the Company’s views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so except as required by law. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date hereof.

ALARM.COM HOLDINGS, INC.

Consolidated Statements of Operations

(in thousands, except share and per share data)

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Revenue:

 

 

 

 

 

 

 

SaaS and license revenue

$

159,276

 

 

$

145,027

 

 

$

465,547

 

 

$

420,853

 

Hardware and other revenue

 

81,221

 

 

 

76,827

 

 

 

232,040

 

 

 

234,592

 

Total revenue

 

240,497

 

 

 

221,854

 

 

 

697,587

 

 

 

655,445

 

Cost of revenue(1):

 

 

 

 

 

 

 

Cost of SaaS and license revenue

 

23,099

 

 

 

21,917

 

 

 

65,621

 

 

 

63,076

 

Cost of hardware and other revenue

 

61,649

 

 

 

59,488

 

 

 

176,924

 

 

 

180,868

 

Total cost of revenue

 

84,748

 

 

 

81,405

 

 

 

242,545

 

 

 

243,944

 

Operating expenses:

 

 

 

 

 

 

 

Sales and marketing

 

27,010

 

 

 

23,861

 

 

 

80,301

 

 

 

74,278

 

General and administrative

 

25,712

 

 

 

31,455

 

 

 

81,112

 

 

 

88,753

 

Research and development

 

62,221

 

 

 

61,014

 

 

 

193,907

 

 

 

183,840

 

Amortization and depreciation

 

7,612

 

 

 

7,948

 

 

 

22,029

 

 

 

23,481

 

Total operating expenses

 

122,555

 

 

 

124,278

 

 

 

377,349

 

 

 

370,352

 

Operating income

 

33,194

 

 

 

16,171

 

 

 

77,693

 

 

 

41,149

 

Interest expense

 

(4,315

)

 

 

(906

)

 

 

(7,079

)

 

 

(2,601

)

Interest income

 

14,384

 

 

 

8,493

 

 

 

33,780

 

 

 

21,092

 

Other expense, net

 

(89

)

 

 

(435

)

 

 

(1,665

)

 

 

(1,214

)

Income before income taxes

 

43,174

 

 

 

23,323

 

 

 

102,729

 

 

 

58,426

 

Provision for income taxes

 

6,718

 

 

 

3,972

 

 

 

10,349

 

 

 

9,257

 

Net income

 

36,456

 

 

 

19,351

 

 

 

92,380

 

 

 

49,169

 

Net loss attributable to redeemable noncontrolling interests

 

226

 

 

 

173

 

 

 

1,408

 

 

 

570

 

Net income attributable to common stockholders

$

36,682

 

 

$

19,524

 

 

$

93,788

 

 

$

49,739

 

 

 

 

 

 

 

 

 

Per share information attributable to common stockholders:

 

 

 

 

 

 

 

Net income attributable to common stockholders per share:

 

 

 

 

 

 

 

Basic

$

0.74

 

 

$

0.39

 

 

$

1.89

 

 

$

1.00

 

Diluted

$

0.67

 

 

$

0.37

 

 

$

1.73

 

 

$

0.94

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

Basic

 

49,282,514

 

 

 

49,917,533

 

 

 

49,691,263

 

 

 

49,782,571

 

Diluted

 

59,780,908

 

 

 

54,778,793

 

 

 

57,212,003

 

 

 

54,588,826

 

______________________________

 

 

 

 

(1) Exclusive of amortization and depreciation shown in operating expenses below.

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense data:

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Cost of hardware and other revenue

$

 

 

$

3

 

 

$

2

 

 

$

3

 

Sales and marketing

 

545

 

 

 

854

 

 

 

2,024

 

 

 

2,778

 

General and administrative

 

3,077

 

 

 

3,260

 

 

 

9,561

 

 

 

9,873

 

Research and development

 

5,572

 

 

 

7,689

 

 

 

20,088

 

 

 

23,769

 

Total stock-based compensation expense

$

9,194

 

 

$

11,806

 

 

$

31,675

 

 

$

36,423

 

 
 

ALARM.COM HOLDINGS, INC.

Consolidated Balance Sheets

(in thousands, except share and per share data)

(unaudited)

 

 

September 30,
2024

 

December 31,
2023

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

1,170,605

 

 

$

696,983

 

Accounts receivable, net of allowance for credit losses of $3,847 and $3,864, and net of allowance for product returns of $2,547 and $2,279 as of September 30, 2024 and December 31, 2023, respectively

 

120,977

 

 

 

130,626

 

Inventory

 

75,037

 

 

 

96,140

 

Other current assets, net

 

46,309

 

 

 

33,031

 

Total current assets

 

1,412,928

 

 

 

956,780

 

Property and equipment, net

 

64,180

 

 

 

54,164

 

Intangible assets, net

 

66,044

 

 

 

78,564

 

Goodwill

 

154,669

 

 

 

154,498

 

Deferred tax assets

 

180,168

 

 

 

131,815

 

Operating lease right-of-use assets

 

54,109

 

 

 

24,242

 

Other assets, net of allowance for credit losses of $1 and $5 as of September 30, 2024 and December 31, 2023, respectively

 

38,900

 

 

 

39,500

 

Total assets

$

1,970,998

 

 

$

1,439,563

 

Liabilities, redeemable noncontrolling interests and stockholders’ equity

 

 

 

Current liabilities:

 

 

 

Accounts payable, accrued expenses and other current liabilities

$

115,085

 

 

$

124,475

 

Accrued compensation

 

27,578

 

 

 

28,626

 

Deferred revenue

 

13,114

 

 

 

10,193

 

Operating lease liabilities

 

7,305

 

 

 

12,043

 

Total current liabilities

 

163,082

 

 

 

175,337

 

Deferred revenue

 

13,897

 

 

 

12,692

 

Convertible senior notes, net

 

981,977

 

 

 

493,515

 

Operating lease liabilities

 

66,251

 

 

 

20,468

 

Other liabilities

 

14,880

 

 

 

12,697

 

Total liabilities

 

1,240,087

 

 

 

714,709

 

Redeemable noncontrolling interests

 

40,610

 

 

 

36,308

 

Stockholders’ equity

 

 

 

Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding as of September 30, 2024 and December 31, 2023

 

 

 

 

 

Common stock, $0.01 par value, 300,000,000 shares authorized; 52,469,598 and 51,888,838 shares issued; and 49,331,867 and 49,868,175 shares outstanding as of September 30, 2024 and December 31, 2023, respectively

 

525

 

 

 

519

 

Additional paid-in capital

 

514,320

 

 

 

531,734

 

Treasury stock, at cost; 3,137,731 and 2,020,663 shares as of September 30, 2024 and December 31, 2023, respectively

 

(186,291

)

 

 

(111,291

)

Accumulated other comprehensive income

 

1,773

 

 

 

1,398

 

Retained earnings

 

359,974

 

 

 

266,186

 

Total stockholders’ equity

 

690,301

 

 

 

688,546

 

Total liabilities, redeemable noncontrolling interests and stockholders’ equity

$

1,970,998

 

 

$

1,439,563

 

 
 

ALARM.COM HOLDINGS, INC.

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

Nine Months Ended
September 30,

Cash flows from operating activities:

 

2024

 

 

 

2023

 

Net income

$

92,380

 

 

$

49,169

 

Adjustments to reconcile net income to net cash flows from operating activities:

 

 

 

Provision for credit losses on accounts receivable

 

530

 

 

 

1,422

 

Reserve for product returns

 

2,672

 

 

 

2,979

 

Provision for credit losses on notes receivable

 

3,996

 

 

 

 

Inventory write-down

 

 

 

 

1,181

 

Amortization on patents and tooling

 

657

 

 

 

965

 

Amortization and depreciation

 

22,029

 

 

 

23,481

 

Amortization of debt issuance costs

 

3,296

 

 

 

2,357

 

Amortization of operating leases

 

9,425

 

 

 

8,540

 

Deferred income taxes

 

(32,739

)

 

 

(42,612

)

Change in fair value of contingent liability

 

105

 

 

 

23

 

Stock-based compensation

 

31,675

 

 

 

36,423

 

Loss from investment in unconsolidated entity

 

203

 

 

 

 

Changes in operating assets and liabilities (net of business acquisitions):

 

 

 

Accounts receivable

 

6,425

 

 

 

11,048

 

Inventory

 

21,195

 

 

 

2,750

 

Other current and non-current assets

 

(5,034

)

 

 

6,423

 

Accounts payable, accrued expenses and other current liabilities

 

(4,904

)

 

 

371

 

Deferred revenue

 

4,126

 

 

 

4,507

 

Operating lease liabilities

 

(9,171

)

 

 

(10,329

)

Other liabilities

 

3,287

 

 

 

(2,605

)

Cash flows from operating activities

 

150,153

 

 

 

96,093

 

Cash flows used in investing activities:

 

 

 

Business acquisition, net of cash acquired

 

 

 

 

(9,696

)

Additions to property and equipment

 

(7,865

)

 

 

(5,349

)

Issuances of notes receivable

 

(500

)

 

 

(300

)

Receipt of payments on notes receivable

 

38

 

 

 

40

 

Capitalized software development costs

 

(1,128

)

 

 

(315

)

Purchase of investment in unconsolidated entities

 

(7,052

)

 

 

(200

)

Purchases of other intangible assets

 

(46

)

 

 

(5,915

)

Cash flows used in investing activities

 

(16,553

)

 

 

(21,735

)

Cash flows from / (used in) financing activities:

 

 

 

Proceeds from issuance of convertible senior notes

 

500,000

 

 

 

 

Payments of debt issuance costs

 

(14,834

)

 

 

 

Purchases of capped calls related to convertible senior notes

 

(63,050

)

 

 

 

Payments of deferred consideration for acquisitions

 

(7,269

)

 

 

(1,672

)

Purchases of treasury stock, including transaction costs

 

(75,000

)

 

 

(12,854

)

Payments of tax withholdings related to vesting of restricted stock units

 

(3,401

)

 

 

 

Purchases of redeemable noncontrolling interest

 

 

 

 

(832

)

Payments of acquired debt

 

 

 

 

(3,016

)

Issuances of common stock from equity-based plans

 

7,840

 

 

 

3,129

 

Cash flows from / (used in) financing activities

 

344,286

 

 

 

(15,245

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

(290

)

 

 

(57

)

Net increase in cash, cash equivalents and restricted cash

 

477,596

 

 

 

59,056

 

Cash, cash equivalents and restricted cash at beginning of the period

 

701,079

 

 

 

622,879

 

Cash, cash equivalents and restricted cash at end of the period

$

1,178,675

 

 

$

681,935

 

 

 

 

 

Reconciliation of cash, cash equivalents and restricted cash:

 

 

 

Cash and cash equivalents

$

1,170,605

 

 

$

679,969

 

Restricted cash included in other current assets and other assets

 

8,070

 

 

 

1,966

 

Total cash, cash equivalents and restricted cash

$

1,178,675

 

 

$

681,935

 

 
 

ALARM.COM HOLDINGS, INC.

Reconciliation of Non-GAAP Measures

(in thousands)

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Non-GAAP adjusted EBITDA:

 

 

 

 

 

 

 

Net income

$

36,456

 

 

$

19,351

 

 

$

92,380

 

 

$

49,169

 

Adjustments:

 

 

 

 

 

 

 

Interest expense, interest income and certain activity within other expense, net

 

(10,069

)

 

 

(7,587

)

 

 

(26,701

)

 

 

(18,491

)

Provision for income taxes

 

6,718

 

 

 

3,972

 

 

 

10,349

 

 

 

9,257

 

Amortization and depreciation expense

 

7,612

 

 

 

7,948

 

 

 

22,029

 

 

 

23,481

 

Stock-based compensation expense

 

9,194

 

 

 

11,806

 

 

 

31,675

 

 

 

36,423

 

Acquisition-related expense

 

61

 

 

 

(4

)

 

 

105

 

 

 

576

 

Litigation expense

 

4

 

 

 

5,949

 

 

 

16

 

 

 

7,968

 

Total adjustments

 

13,520

 

 

 

22,084

 

 

 

37,473

 

 

 

59,214

 

Non-GAAP adjusted EBITDA

$

49,976

 

 

$

41,435

 

 

$

129,853

 

 

$

108,383

 

 

 

 

 

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Non-GAAP adjusted net income:

 

 

 

 

 

 

 

Net income, as reported

$

36,456

 

 

$

19,351

 

 

$

92,380

 

 

$

49,169

 

Provision for income taxes

 

6,718

 

 

 

3,972

 

 

 

10,349

 

 

 

9,257

 

Income before income taxes

 

43,174

 

 

 

23,323

 

 

 

102,729

 

 

 

58,426

 

Adjustments:

 

 

 

 

 

 

 

Less: interest income and certain activity within other expense, net

 

(14,384

)

 

 

(8,493

)

 

 

(33,780

)

 

 

(21,092

)

Amortization expense

 

4,753

 

 

 

5,190

 

 

 

14,154

 

 

 

15,076

 

Amortization of debt issuance costs

 

1,485

 

 

 

787

 

 

 

3,296

 

 

 

2,357

 

Stock-based compensation expense

 

9,194

 

 

 

11,806

 

 

 

31,675

 

 

 

36,423

 

Acquisition-related expense

 

61

 

 

 

(4

)

 

 

105

 

 

 

576

 

Litigation expense

 

4

 

 

 

5,949

 

 

 

16

 

 

 

7,968

 

Non-GAAP adjusted income before income taxes

 

44,287

 

 

 

38,558

 

 

 

118,195

 

 

 

99,734

 

Income taxes 1

 

(9,300

)

 

 

(8,097

)

 

 

(24,821

)

 

 

(20,944

)

Non-GAAP adjusted net income

$

34,987

 

 

$

30,461

 

 

$

93,374

 

 

$

78,790

 

 

1 Income taxes are calculated using a rate of 21.0% for each of the three and nine months ended September 30, 2024 and 2023. The 21.0% effective tax rate for each of the three and nine months ended September 30, 2024 and 2023 excludes the income tax effect on the non-GAAP adjustments and reflects the estimated long-term corporate tax rate.

 

ALARM.COM HOLDINGS, INC.

Reconciliation of Non-GAAP Measures - continued

(in thousands, except share and per share data)

(unaudited)

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Non-GAAP adjusted net income attributable to common stockholders:

 

 

 

 

 

 

 

Net income attributable to common stockholders, as reported

$

36,682

 

 

$

19,524

 

 

$

93,788

 

 

$

49,739

 

Provision for income taxes

 

6,718

 

 

 

3,972

 

 

 

10,349

 

 

 

9,257

 

Income attributable to common stockholders before income taxes

 

43,400

 

 

 

23,496

 

 

 

104,137

 

 

 

58,996

 

Adjustments:

 

 

 

 

 

 

 

Less: interest income and certain activity within other expense, net

 

(14,384

)

 

 

(8,493

)

 

 

(33,780

)

 

 

(21,092

)

Amortization expense

 

4,753

 

 

 

5,190

 

 

 

14,154

 

 

 

15,076

 

Amortization of debt issuance costs

 

1,485

 

 

 

787

 

 

 

3,296

 

 

 

2,357

 

Stock-based compensation expense

 

9,194

 

 

 

11,806

 

 

 

31,675

 

 

 

36,423

 

Acquisition-related expense

 

61

 

 

 

(4

)

 

 

105

 

 

 

576

 

Litigation expense

 

4

 

 

 

5,949

 

 

 

16

 

 

 

7,968

 

Non-GAAP adjusted income attributable to common stockholders before income taxes

 

44,513

 

 

 

38,731

 

 

 

119,603

 

 

 

100,304

 

Income taxes 1

 

(9,348

)

 

 

(8,134

)

 

 

(25,117

)

 

 

(21,064

)

Non-GAAP adjusted net income attributable to common stockholders

$

35,165

 

 

$

30,597

 

 

$

94,486

 

 

$

79,240

 

 

1 Income taxes are calculated using a rate of 21.0% for each of the three and nine months ended September 30, 2024 and 2023. The 21.0% effective tax rate for each of the three and nine months ended September 30, 2024 and 2023 excludes the income tax effect on the non-GAAP adjustments and reflects the estimated long-term corporate tax rate.

 

ALARM.COM HOLDINGS, INC.

Reconciliation of Non-GAAP Measures - continued

(in thousands, except share and per share data)

(unaudited)

 

Three Months Ended
September 30,

 

Nine Months Ended

September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Non-GAAP adjusted net income attributable to common stockholders per share:

 

 

 

 

 

 

 

Net income attributable to common stockholders per share - basic, as reported

$

0.74

 

 

$

0.39

 

 

$

1.89

 

 

$

1.00

 

Provision for income taxes

 

0.14

 

 

 

0.08

 

 

 

0.21

 

 

 

0.19

 

Income attributable to common stockholders before income taxes

 

0.88

 

 

 

0.47

 

 

 

2.10

 

 

 

1.19

 

Adjustments:

 

 

 

 

 

 

 

Less: interest income and certain activity within other expense, net

 

(0.29

)

 

 

(0.17

)

 

 

(0.68

)

 

 

(0.42

)

Amortization expense

 

0.10

 

 

 

0.10

 

 

 

0.28

 

 

 

0.30

 

Amortization of debt issuance costs

 

0.03

 

 

 

0.02

 

 

 

0.07

 

 

 

0.05

 

Stock-based compensation expense

 

0.18

 

 

 

0.23

 

 

 

0.64

 

 

 

0.73

 

Acquisition-related expense

 

 

 

 

 

 

 

 

 

 

0.01

 

Litigation expense

 

 

 

 

0.12

 

 

 

 

 

 

0.16

 

Non-GAAP adjusted income attributable to common stockholders before income taxes

 

0.90

 

 

 

0.77

 

 

 

2.41

 

 

 

2.02

 

Income taxes 1

 

(0.19

)

 

 

(0.16

)

 

 

(0.51

)

 

 

(0.43

)

Non-GAAP adjusted net income attributable to common stockholders per share - basic

$

0.71

 

 

$

0.61

 

 

$

1.90

 

 

$

1.59

 

Non-GAAP adjusted net income attributable to common stockholders per share - diluted 2

$

0.62

 

 

$

0.56

 

 

$

1.70

 

 

$

1.45

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

Basic, as reported

 

49,282,514

 

 

 

49,917,533

 

 

 

49,691,263

 

 

 

49,782,571

 

Diluted, as reported

 

59,780,908

 

 

 

54,778,793

 

 

 

57,212,003

 

 

 

54,588,826

 

 

1 Income taxes are calculated using a rate of 21.0% for each of the three and nine months ended September 30, 2024 and 2023. The 21.0% effective tax rate for each of the three and nine months ended September 30, 2024 and 2023 excludes the income tax effect on the non-GAAP adjustments and reflects the estimated long-term corporate tax rate.

 

2 Non-GAAP adjusted net income attributable to common stockholders per diluted share includes the add back of cash interest expense, net of tax, attributable to convertible senior notes of $2.1 million and $2.8 million for the three and nine months ended September 30, 2024, respectively.

 
 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Non-GAAP free cash flow:

 

 

 

 

 

 

 

Cash flows from operating activities

$

77,337

 

 

$

62,826

 

 

$

150,153

 

 

$

96,093

 

Additions to property and equipment

 

(2,807

)

 

 

(1,956

)

 

 

(7,865

)

 

 

(5,349

)

Non-GAAP free cash flow

$

74,530

 

 

$

60,870

 

 

$

142,288

 

 

$

90,744

 

 

Investor & Media Relations:

Matthew Zartman

Alarm.com

ir@alarm.com

Source: Alarm.com Holdings, Inc.

FAQ

What was Alarm.com's (ALRM) SaaS revenue growth in Q3 2024?

Alarm.com's SaaS and license revenue grew 9.8% year-over-year to $159.3 million in Q3 2024.

How much did Alarm.com's (ALRM) net income increase in Q3 2024?

GAAP net income increased 87.9% to $36.7 million compared to $19.5 million in Q3 2023.

What is Alarm.com's (ALRM) full-year 2024 revenue guidance?

Alarm.com expects total revenue between $933.7-935.9 million, with SaaS and license revenue of $628.7-628.9 million.

What new products did Alarm.com (ALRM) launch in Q3 2024?

Alarm.com launched OpenEye Cloud Cameras, AI-Deterrence capability for video monitoring, and Smart Thermostat HQ.

Alarm.com Holdings, Inc.

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