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ALLE's Q2 adjusted EPS of $2.04 topped estimates and rose 4.1% year over year.
Revenues rose 5.8% to $1.02B, driven by 6.6% growth in Allegion Americas and strong non-residential demand.
ALLE raised the 2025 revenue growth forecast to 6.57.5% and EPS outlook to $8.00-$8.15.
Allegion plc’s (ALLE - Free Report) second-quarter 2025 adjusted earnings of $2.04 per share beat the Zacks Consensus Estimate of $2. The bottom line increased 4.1% year over year.
ALLE’s Revenue Details
Allegion’s revenues were $1.02 billion, which increased 5.8% year over year. Organic revenues increased 3.2%, driven by solid momentum in the non-residential business in the Americas region. Revenues beat the Zacks Consensus Estimate of $1 billion.
Acquired assets boosted revenues by 1.9%. Foreign currency had a positive impact of 0.7%.
ALLE reports revenues under two segments. A brief discussion of quarterly results is provided below:
Revenues from Allegion Americas increased 6.6% year over year to $821.5 million. The figure accounted for 80.4% of the quarter’s revenues. Our estimate for segmental revenues was $801.9 million. Organic revenues increased 4.5%, driven by solid momentum in the non-residential businesses, which grew in high-single digits.
Operating income for the segment was $236.6 million, up 10.4% year over year. Our estimate was $230.9 million.
Revenues from Allegion International were $200.5 million, up 2.9% year over year. The metric accounted for 19.6% of the quarter’s revenues. Our estimate for segmental revenues was $186.2 million. However, organic revenues declined 2.2%.
Segmental operating income was $15.7 million, down 11.3% year over year. Our estimate was $22.1 million.
In the quarter, Allegion’s cost of revenues increased 3.4% year over year to $555.5 million. Gross profit was $466.5 million, up 8.9% year over year, while the gross margin jumped 120 basis points (bps) to 45.6%.
Selling and administrative expenses increased 12.5% year over year to $246.8 million. Adjusted EBITDA was $258.1 million, reflecting a year-over-year increase of 5.9%. The margin was 25.3%, flat on a year-over-year basis.
Adjusted operating income increased 5.8% year over year to $241.9 million. The adjusted margin was 23.7%, flat year over year. Interest expenses were $24.6 million, down 2% year over year. The effective tax rate was 20.3%, up from 17.8% in the year-ago quarter.
ALLE’s Balance Sheet and Cash Flow
While exiting second-quarter 2025, Allegion had cash and cash equivalents of $656.8 million compared with $503.8 million at the end of 2024. Long-term debt was $2.04 billion compared with $1.98 billion at the end of 2024.
In the first six months of 2025, ALLE generated net cash of $314.2 million from operating activities, reflecting an increase of 40.2% year over year. Capital expenditure was $38.8 million, down 19.3% year over year. For the first six months, the available cash flow was $275.4 million.
Allegion repurchased shares for $80.0 million. Dividends paid out totaled $87.8 million, reflecting an increase of 4.8% year over year.
Allegion’s 2025 Outlook
The company has raised the 2025 guidance. Allegion expects revenues to increase in the range of 6.5-7.5% from the year-ago level compared with 1-3% anticipated earlier. ALLE anticipates organic revenues to grow in the range of 3.5-4.5% compared with 1.5-3.5% expected earlier.
Adjusted earnings are projected to be in the range of $8.00-$8.15 per share compared with $7.65-$7.85 expected earlier.
The company estimates available cash flow to be 85-90% of adjusted net income. Adjusted effective tax rate is projected to be approximately 17-18%.
Dover Corporation (DOV - Free Report) reported earnings of $2.44 per share in econd quarter 2025, beating the Zacks Consensus Estimate of $2.39. This compares with earnings of $2.36 per share a year ago.
Dover posted revenues of $2.05 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.6%. This compares with year-ago revenues of $2.18 billion.
Teck Resources Limited (TECK - Free Report) came out with earnings of $0.27 per share in the second quarter of 2025, beating the Zacks Consensus Estimate of $0.2. This compares with earnings of $0.58 per share a year ago.
Teck Resources posted revenues of $1.46 billion in the quarter, missing the Zacks Consensus Estimate by 8.7%. This compares with year-ago revenues of $2.83 billion.
Packaging Corporation of America (PKG - Free Report) reported earnings of $2.48 per share, beating the Zacks Consensus Estimate of $2.44. This compares with earnings of $2.2 per share a year ago.
Packaging Corp. posted revenues of $2.17 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.5%. This compares with year-ago revenues of $2.08 billion.
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Allegion's Q2 Earnings & Revenues Surpass Estimates, Increase Y/Y
Key Takeaways
Allegion plc’s (ALLE - Free Report) second-quarter 2025 adjusted earnings of $2.04 per share beat the Zacks Consensus Estimate of $2. The bottom line increased 4.1% year over year.
ALLE’s Revenue Details
Allegion’s revenues were $1.02 billion, which increased 5.8% year over year. Organic revenues increased 3.2%, driven by solid momentum in the non-residential business in the Americas region. Revenues beat the Zacks Consensus Estimate of $1 billion.
Acquired assets boosted revenues by 1.9%. Foreign currency had a positive impact of 0.7%.
ALLE reports revenues under two segments. A brief discussion of quarterly results is provided below:
Revenues from Allegion Americas increased 6.6% year over year to $821.5 million. The figure accounted for 80.4% of the quarter’s revenues. Our estimate for segmental revenues was $801.9 million. Organic revenues increased 4.5%, driven by solid momentum in the non-residential businesses, which grew in high-single digits.
Operating income for the segment was $236.6 million, up 10.4% year over year. Our estimate was $230.9 million.
Revenues from Allegion International were $200.5 million, up 2.9% year over year. The metric accounted for 19.6% of the quarter’s revenues. Our estimate for segmental revenues was $186.2 million. However, organic revenues declined 2.2%.
Segmental operating income was $15.7 million, down 11.3% year over year. Our estimate was $22.1 million.
Allegion PLC Price, Consensus and EPS Surprise
Allegion PLC price-consensus-eps-surprise-chart | Allegion PLC Quote
Allegion’s Margin Profile
In the quarter, Allegion’s cost of revenues increased 3.4% year over year to $555.5 million. Gross profit was $466.5 million, up 8.9% year over year, while the gross margin jumped 120 basis points (bps) to 45.6%.
Selling and administrative expenses increased 12.5% year over year to $246.8 million. Adjusted EBITDA was $258.1 million, reflecting a year-over-year increase of 5.9%. The margin was 25.3%, flat on a year-over-year basis.
Adjusted operating income increased 5.8% year over year to $241.9 million. The adjusted margin was 23.7%, flat year over year. Interest expenses were $24.6 million, down 2% year over year. The effective tax rate was 20.3%, up from 17.8% in the year-ago quarter.
ALLE’s Balance Sheet and Cash Flow
While exiting second-quarter 2025, Allegion had cash and cash equivalents of $656.8 million compared with $503.8 million at the end of 2024. Long-term debt was $2.04 billion compared with $1.98 billion at the end of 2024.
In the first six months of 2025, ALLE generated net cash of $314.2 million from operating activities, reflecting an increase of 40.2% year over year. Capital expenditure was $38.8 million, down 19.3% year over year. For the first six months, the available cash flow was $275.4 million.
Allegion repurchased shares for $80.0 million. Dividends paid out totaled $87.8 million, reflecting an increase of 4.8% year over year.
Allegion’s 2025 Outlook
The company has raised the 2025 guidance. Allegion expects revenues to increase in the range of 6.5-7.5% from the year-ago level compared with 1-3% anticipated earlier. ALLE anticipates organic revenues to grow in the range of 3.5-4.5% compared with 1.5-3.5% expected earlier.
Adjusted earnings are projected to be in the range of $8.00-$8.15 per share compared with $7.65-$7.85 expected earlier.
The company estimates available cash flow to be 85-90% of adjusted net income. Adjusted effective tax rate is projected to be approximately 17-18%.
ALLE’s Zacks Rank
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Companies
Dover Corporation (DOV - Free Report) reported earnings of $2.44 per share in econd quarter 2025, beating the Zacks Consensus Estimate of $2.39. This compares with earnings of $2.36 per share a year ago.
Dover posted revenues of $2.05 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.6%. This compares with year-ago revenues of $2.18 billion.
Teck Resources Limited (TECK - Free Report) came out with earnings of $0.27 per share in the second quarter of 2025, beating the Zacks Consensus Estimate of $0.2. This compares with earnings of $0.58 per share a year ago.
Teck Resources posted revenues of $1.46 billion in the quarter, missing the Zacks Consensus Estimate by 8.7%. This compares with year-ago revenues of $2.83 billion.
Packaging Corporation of America (PKG - Free Report) reported earnings of $2.48 per share, beating the Zacks Consensus Estimate of $2.44. This compares with earnings of $2.2 per share a year ago.
Packaging Corp. posted revenues of $2.17 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.5%. This compares with year-ago revenues of $2.08 billion.