Alarm.com Holdings, Inc.
For the period ended Dec 31, 2025. Filed Feb 19, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 19, 2026
ALRM$65.03-3.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
0001459200-25-000004
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-19.
0001459200-26-000005
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 200 previous paragraphs and 213 current paragraphs.
125 unchanged; 63 reworded; 21 added; 9 removed; 3 previous and 4 current paragraphs rearranged.
Tables are not compared: 21 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
On November 20, 2025, we paid $30.1 million in cash to purchase 20.3% of the outstanding shares of Pronet. We do not have a controlling financial interest in Pronet, but based on the legal form of Pronet, our level of ownership and our extent of influence, we concluded that this equity investment in Pronet, which is included in the Alarm.com segment, does not meet the criteria for consolidation and will be accounted for under the equity method of accounting.
Current report
On November 21, 2025, EnergyHub acquired 100% of the issued and outstanding shares of capital stock of RGS. RGS provides demand response aggregation and program management services for utilities. The acquisition is anticipated to strengthen EnergyHub’s position in the demand response market as well as make new demand energy response classes available to RGS customers. On November 21, 2025, in consideration for the purchase of 100% of the issued and outstanding shares of capital stock of RGS, we paid $77.2 million in cash. Pursuant to the terms of the stock purchase agreement, following the preliminary determination of the working capital of RGS as of the closing date, the purchase price increased by $1.6 million. The working capital adjustment is expected to be finalized during the first quarter of 2026. The purchase price allocation was not finalized as of the filing date of this Annual Report on Form 10-K and is primarily pending the final determination of the working capital adjustment.
Current report
On January 14, 2026, we paid $500.0 million in aggregate principal amount to holders of the 2026 Notes, fully settling the outstanding balance. The settlement was funded with cash on hand, consistent with our stated intent, with no shares of common stock issued.
Current report
In April 2025, the U.S. government announced a baseline tariff of 10% on all products imported into the United States (with certain limited exceptions) and additional individualized tariffs based on country of origin at different rates per country. Certain of these tariffs have been subsequently paused or modified, and the situation remains fluid. The United States and/or countries into which we import products have adjusted and/or imposed and may, in the future, adjust and/or impose new quotas, duties, tariffs or reciprocal tariffs or other restrictions. A significant portion of our hardware is produced outside the United States, including in Vietnam, Thailand and Taiwan. The U.S. government has since announced several tariff framework agreements, including with countries where a significant portion of our hardware is produced. While we began passing through the costs of baseline tariffs to our customers in the second quarter of 2025, as of December 31, 2025, we had not yet adjusted those pass-throughs to account for certain newer tariffs at higher rates. As a result, we began to absorb those additional costs, which we expect will negatively impact our hardware revenue margins in 2026. The ultimate impact of any tariffs will depend on various factors, including how long such tariffs remain in place, the ultimate levels of such tariffs, the outcome of pending legal challenges to their validity, how other countries respond to the U.S. tariffs, and the specific timing of when we implement higher pass-through costs.
Current report
Other Income / (Expense), Net
Current report
Income from Equity Method Investments, Net
Current report
Income from equity method investments, net primarily consists of our share of the net assets and net income / (losses) of our investees accounted for under the equity method, including the impacts of amortization expense related to basis differences.
Current report
Amortization and depreciation increased $1.7 million in 2025, as compared to 2024, primarily due to intangible assets that were acquired in connection with the purchase of 81% of the issued and outstanding shares of capital stock of CHeKT on February 10, 2025, the purchase of 100% of the issued and outstanding shares of capital stock of BTR on August 15, 2025, and the purchase of 100% of the issued and outstanding shares of capital stock of RGS on November 21, 2025, as well as changes in depreciation expense related to property and equipment.
Current report
Interest income decreased $1.7 million in 2025 as compared to 2024, primarily due to a decrease in interest income earned on cash and cash equivalents from lower average interest rates and lower amounts of cash and cash equivalents during some of 2025, as compared to 2024.
Current report
Other Income / (Expense), Net
Current report
Other income / (expense), net increased $7.5 million in 2025 primarily due to a $4.7 million gain on publicly traded equity securities within our treasury portfolio and a $2.0 million gain on fluctuations in foreign currency exchange rates.
Current report
Income from Equity Method Investments, Net
Current report
Income from equity method investments, net increased $2.5 million in 2025, as compared to 2024, primarily due to the increase in our share of the net assets and net income of our investees accounted for under the equity method, partially offset by amortization expense related to basis differences in our equity method investments.
Current report
On July 4, 2025, the OBBBA was enacted in the United States. The OBBBA includes a broad range of tax provisions that impact the timing and the magnitude of certain key tax deductions. The most significant provisions to us are the permanent reinstatement of the full and immediate deduction for domestic research and development expenditures in the year such costs are incurred and the 100% first-year bonus depreciation deduction, with both provisions reducing our associated deferred tax assets. We currently anticipate these provisions will significantly reduce our current federal income tax cash outlays over the next several years. Certain other international tax provisions may also be favorable to us beginning in 2026.
Current report
On April 28, 2025, we paid $29.1 million in cash to purchase 24.7% of the outstanding shares of SafeStreets. We do not have a controlling financial interest in SafeStreets, but based on the legal form of SafeStreets, our level of ownership and the extent of influence, we concluded that this equity investment in SafeStreets, which is included in the Alarm.com segment, does not meet the criteria for consolidation and will be accounted for under the equity method of accounting.
Current report
On May 30, 2025, we paid $119.3 million in cash to purchase 32.5% of the outstanding shares of Safe Haven after deducting $6.3 million related to an agreed holdback provision that is expected to be paid during the second quarter of 2026. On June 6, 2025, we paid $19.2 million in cash to purchase 32.5% of the outstanding shares of All Access, after deducting $1.0 million related to an agreed holdback provision that is expected to be paid during the second quarter of 2026. After consummation of these transactions, All Access and Safe Haven were under common control. We do not have a controlling financial interest in Safe Haven or All Access, but based on the legal form of Safe Haven and All Access, our level of ownership and the extent of influence, we concluded that the equity investments in Safe Haven and All Access, which are included in the Alarm.com segment, do not meet the criteria for consolidation and will be accounted for under the equity method of accounting.
Current report
On August 15, 2025, EnergyHub acquired all of the issued and outstanding shares of capital stock of BTR. BTR provides a managed charging solution for electric vehicle manufacturers and drivers. BTR’s technology integrates directly into a vehicle’s native mobile app, delivering utility program enrollment, charging insights and incentives to electric vehicle drivers. The acquisition is anticipated to expand EnergyHub’s ecosystem of automotive partners and strengthen its end-to-end managed charging offering, supporting improved driver engagement and grid optimization for utility clients. In consideration for the purchase of all of the issued and outstanding shares of capital stock of BTR, we paid $12.4 million in cash on August 15, 2025, after deducting $1.6 million related to agreed holdback provisions.
Current report
On November 20, 2025, we paid $30.1 million in cash to purchase 20.3% of the outstanding shares of Pronet. We do not have a controlling financial interest in Pronet, but based on the legal form of Pronet, our level of ownership and our extent of influence, we concluded that this equity investment in Pronet, which is included in the Alarm.com segment, does not meet the criteria for consolidation and will be accounted for under the equity method of accounting.
Current report
On November 21, 2025, in consideration for the purchase of 100% of the issued and outstanding shares of capital stock of RGS, we paid $77.2 million in cash. Pursuant to the terms of the stock purchase agreement, following the preliminary determination of the working capital of RGS as of the closing date, the purchase price increased by $1.6 million.
Current report
On January 14, 2026, we paid $500.0 million in aggregate principal amount to holders of the 2026 Notes, fully settling the outstanding balance. The settlement was funded with cash on hand, consistent with our stated intent, with no shares of common stock issued.
Current report
For 2025, cash flows used in investing activities was $358.5 million, compared to $24.7 million in 2024. The $333.8 million increase in cash used in investing activities was primarily due to an increase of $194.9 million in purchases of investments in unconsolidated entities in 2025 as compared to 2024 as well as an increase of $24.8 million in notes receivable issued, primarily due to the $21.5 million note receivable issued to SafeStreets in 2025 that did not occur in 2024. The increase in cash used in investing activities was also due to $23.6 million paid to purchase 81% of the issued and outstanding shares of capital stock of CHeKT on February 10, 2025, $12.4 million paid to purchase all of the issued and outstanding shares of capital stock of BTR on August 15, 2025 and $77.2 million paid to purchase all of the issued and outstanding shares of capital stock of RGS on November 21, 2025.
Removed paragraphs (9)
Previous report
On February 10, 2025, Alarm.com Incorporated acquired 81% of the issued and outstanding shares of capital stock of CHeKT. CHeKT provides a remote video monitoring service for central station operators that is compatible with a variety of cameras. We believe the acquisition of CHeKT will help to expand our opportunity to provide remote video monitoring solutions in the commercial and residential markets.
Previous report
Since 2019, the U.S. government has implemented and imposed significant changes to U.S. trade policy with respect to China. Tariffs have subjected certain Alarm.com products manufactured overseas to additional import duties of up to 25%. The amount of the import tariff and the number of products subject to tariffs have changed numerous times based on action by the U.S. government. Less than one-third of the hardware products that we sell to our service provider partners are imported from China and could be subject to increased tariffs. While the additional import duties resulted in an increase to our cost of hardware revenue, these import duties had a modest impact on hardware revenue margins. If tariffs are increased or are expanded to apply to more of our products, such actions may increase our cost of hardware revenue and reduce our hardware revenue margins in the future. We continue to monitor the changes in tariffs.
Previous report
We currently expect our hardware revenue margins in 2025 to approximate the hardware revenue margins experienced during 2024.
Previous report
Other (Expense) / Income, Net
Previous report
Amortization and depreciation decreased $2.3 million in 2024 as compared to 2023, primarily due to changes in amortization expense related to the intangible assets we previously acquired.
Previous report
Interest income increased $17.6 million in 2024 as compared to 2023, primarily due to an increase in interest income earned on cash and cash equivalents from higher amounts of cash and cash equivalents and higher average interest rates during 2024 as compared to 2023. The increase in interest income was partially offset by a $0.5 million reduction to interest income for the reversal of payable in kind interest associated with a subordinated credit agreement with an affiliated entity of one of our distribution partners during 2024, which did not occur during 2023.
Previous report
Other (Expense) / Income, Net
Previous report
Other (expense) / income, net decreased $7.3 million in 2024 as compared to 2023, primarily due to a gain recorded from the settlement of a legal matter in 2023 that did not occur in 2024 as well as an increase in non-operating and miscellaneous expenses.
Previous report
For 2023, cash flows used in financing activities was $31.9 million, compared to $76.3 million in 2022. The $44.4 million decrease in cash flows used in financing activities was primarily due to the $51.5 million decrease in purchases of shares of our common stock in 2023 as compared to 2022, partially offset by $3.0 million in debt payments related to the debt assumed in the acquisition of EBS as well as $2.6 million of tax withholdings paid related to vesting of restricted stock units in 2023, which did not occur in 2022.
Reworded paragraphs (63)
Previous wording
Alarm.com is the leading platform for the intelligently connected property. Our cloud-based platform offers an expansive suite of IoT solutions addressing global opportunities in the residential, multi-family, small business and enterprise commercial markets. Alarm.com’s solution suite includes security, video and video analytics, energy management, access control, electric utility grid management, indoor gunshot detection, water management, health and wellness, personal safety and data-rich emergency response. During 2024, our platforms processed more than 345 billion data points generated by over 160 million connected devices. We believe this scale of subscribers, connected devices and data operations makes us the leader in the connected property market.
Current wording
Alarm.com is the leading platform for intelligently connected properties. Our cloud-based platform offers an expansive suite of IoT solutions addressing global opportunities in the residential, multi-family, small business, enterprise commercial and energy markets. Alarm.com’s solution suite includes security, video surveillance and video analytics, energy management, access control, electric utility grid management, active shooter detection, water management, personal safety and data-rich emergency response. During 2025, our platforms processed more than 365 billion data points generated by over 170 million connected devices. We believe this scale of subscribers, connected devices and data operations makes us the leader in the connected property market.
Previous wording
Alarm.com has established a global network of trusted service provider partners who distribute our solutions to their customers. Our service provider partners represent a diverse range of independent businesses, and are experts at selling, installing and supporting our technology. They depend on the Alarm.com platform for connected property technology and to operate and manage their businesses efficiently.
Current wording
Alarm.com has established a global network of trusted service provider partners who distribute our solutions to their customers. Our service provider partners represent a wide range of independent businesses, and are experts at selling, installing and supporting our technology. They depend on the Alarm.com platform for connected property technology and to operate and manage their businesses efficiently.
Previous wording
The Alarm.com platform enables our service provider partners to address the needs of a broad range of residential and commercial customers. They can deploy interactive security, video monitoring, property automation, access control, energy management, gunshot detection, water management, vehicle and fleet management, and wellness and personal safety solutions as stand-alone offerings or as integrated solutions.
Current wording
The Alarm.com platform enables our service provider partners to address the needs of a broad range of residential and commercial customers. They can deploy interactive security, video monitoring, property automation, access control, energy management, gunshot detection, water management, vehicle and fleet management, and personal safety solutions as stand-alone offerings or as integrated solutions.
Previous wording
Alarm.com primarily generates SaaS and license revenue, our largest source of revenue, through our service provider partners, who resell our services and pay us monthly fees. Our service provider partners sell, install and support Alarm.com solutions that enable residential and commercial property owners to intelligently secure, connect, control and automate their properties. Our subscribers consist of all of the properties maintained by those residential and commercial property owners to which we are delivering at least one of our solutions. We derive a portion of our revenue from licensing our intellectual property to third parties on a per customer basis. SaaS and license revenue represented 67%, 65% and 62% of our revenue in 2024, 2023 and 2022, respectively.
Current wording
We primarily generate SaaS and license revenue, our largest source of revenue, through our service provider partners, who resell our services and pay us monthly fees. Our service provider partners sell, install and support Alarm.com solutions that enable residential and commercial property owners to intelligently secure, connect, control and automate their properties. Our subscribers consist of all of the properties maintained by those residential and commercial property owners to which we are delivering at least one of our solutions. We derive a portion of our revenue from licensing our intellectual property to third parties on a per customer basis. SaaS and license revenue represented 68%, 67% and 65% of our revenue in 2025, 2024 and 2023, respectively.
Previous wording
We also generate SaaS and license revenue from monthly fees charged to service providers on a per subscriber basis for access to our non-hosted software platform, or Software platform. The non-hosted software for interactive security, automation and related solutions is typically deployed and operated by the service provider in its own network operations center. Software license revenue represented 2%, 3% and 3% of our revenue in 2024, 2023 and 2022, respectively.
Current wording
We also generate SaaS and license revenue from monthly fees charged to service providers on a per subscriber basis for access to our non-hosted software platform, or Software platform. The non-hosted software for interactive security, automation and related solutions is typically deployed and operated by the service provider in its own network operations center. Software license revenue represented 2%, 2% and 3% of our revenue in 2025, 2024 and 2023, respectively.
Previous wording
We also generate revenue from the sale of many types of hardware, including video cameras, video recorders, cellular radio modules, smart thermostats, image sensors, gunshot detection sensors and other peripherals, that enable our solutions. Our hardware and other revenue also includes our revenue from the sale of perpetual licenses that provide our customers in the commercial market the right to use our video surveillance software for an indefinite period of time in exchange for a one-time license fee. Additionally, our hardware and other revenue includes our revenue from the sale of licenses that provide our customers the right to use our gunshot detection solution in exchange for license fees. Hardware and other revenue represented 33%, 35% and 38% of our revenue in 2024, 2023 and 2022, respectively. We typically expect hardware and other revenue to fluctuate as a percentage of total revenue.
Current wording
We also generate revenue from the sale of many types of hardware, including video cameras, video recorders, cellular radio modules, smart thermostats, image sensors, gunshot detection sensors and other peripherals, that enable our solutions. Our hardware and other revenue also includes our revenue from the sale of perpetual licenses that provide our customers in the commercial market the right to use our video surveillance software for an indefinite period of time in exchange for a one-time license fee. Additionally, our hardware and other revenue includes our revenue from the sale of licenses that provide our customers the right to use our gunshot detection solution in exchange for license fees. Hardware and other revenue represented 32%, 33% and 35% of our revenue in 2025, 2024 and 2023, respectively. We typically expect hardware and other revenue to fluctuate as a percentage of total revenue.
Previous wording
•SaaS and license revenue increased 11% to $631.2 million in 2024 from $569.2 million in 2023. SaaS and license revenue increased 9% to $569.2 million in 2023 from $520.4 million in 2022. Software license revenue decreased to $20.3 million in 2024 from $23.2 million in 2023. Software license revenue decreased to $23.2 million in 2023 from $26.8 million in 2022.
Current wording
•SaaS and license revenue increased 9% to $689.4 million in 2025 from $631.2 million in 2024. SaaS and license revenue increased 11% to $631.2 million in 2024 from $569.2 million in 2023. Software license revenue decreased to $17.7 million in 2025 from $20.3 million in 2024. Software license revenue decreased to $20.3 million in 2024 from $23.2 million in 2023.
Previous wording
•Total revenue increased 7% to $939.8 million in 2024 from $881.7 million in 2023. Total revenue increased 5% to $881.7 million in 2023 from $842.6 million in 2022.
Current wording
•Total revenue increased 8% to $1.0112 billion in 2025 from $939.8 million in 2024. Total revenue increased 7% to $939.8 million in 2024 from $881.7 million in 2023.
Previous wording
•Net income increased 52% to $122.5 million in 2024 from $80.3 million in 2023. Net income increased 44% to $80.3 million in 2023 from $55.6 million in 2022. Net income attributable to common stockholders increased 53% to $124.1 million in 2024 from $81.0 million in 2023. Net income attributable to common stockholders increased 44% to $81.0 million in 2023 from $56.3 million in 2022.
Current wording
•Net income increased 7% to $131.6 million in 2025 from $122.5 million in 2024. Net income increased 52% to $122.5 million in 2024 from $80.3 million in 2023. Net income attributable to common stockholders increased 7% to $132.6 million in 2025 from $124.1 million in 2024. Net income attributable to common stockholders increased 53% to $124.1 million in 2024 from $81.0 million in 2023.
Previous wording
•Non-GAAP adjusted EBITDA, a non-GAAP measurement of operating performance, increased to $176.2 million in 2024 from $154.0 million in 2023. Non-GAAP adjusted EBITDA increased to $154.0 million in 2023 from $146.8 million in 2022.
Current wording
•Non-GAAP adjusted EBITDA, a non-GAAP measurement of operating performance, increased to $206.0 million in 2025 from $176.2 million in 2024. Non-GAAP adjusted EBITDA increased to $176.2 million in 2024 from $154.0 million in 2023.
Previous wording
Information about current period and prior period acquisitions that may affect the comparability of our historical financial information is included in Item 1. Business – Governance – Corporate Information. Information about the 2029 Notes and the related interest expense as well as changes in legal costs, which may affect the comparability of historical financial information, is disclosed in the Comparison of Years Ended December 31, 2024 to December 31, 2023 section below within Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations."
Current wording
Information about current period and prior period acquisitions that may affect the comparability of our historical financial information is included in Item 1. Business – Governance – Corporate Information. Information about the 2029 Notes and the related interest expense as well as changes in legal costs, which may affect the comparability of historical financial information, is disclosed in the Comparison of Years Ended December 31, 2025 to December 31, 2024 section below within Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations." Information about investments in unconsolidated entities accounted for under the equity method of accounting and the related equity method income from our investments in unconsolidated entities as well as acquisitions, which may affect the comparability of historical financial information, is disclosed in the Comparison of Years Ended December 31, 2025 to December 31, 2024 section below within Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations."
Previous wording
We believe there is significant opportunity to expand our international business, as 6% of our total revenue during the year ended December 31, 2024 originated from customers located outside of North America. Our products are currently localized and available in over 50 countries outside of North America. On November 22, 2024, we acquired certain assets of Kapacity.io to help accelerate deployment of a cloud-based demand response platform internationally for our EnergyHub subsidiary.
Current wording
We believe there is significant opportunity to expand our international business, as 5% of our total revenue during the year ended December 31, 2025 originated from customers located outside of North America. Our products are currently localized and available in over 50 countries outside of North America.
Previous wording
The global economy, credit markets and financial markets have and may continue to experience significant volatility as a result of the Macroeconomic Conditions. These Macroeconomic Conditions have and may continue to create tariffs, supply chain disruptions, inventory disruptions, and fluctuations in economic growth, including fluctuations in employment rates, inflation, energy prices and consumer sentiment. It remains difficult to assess or predict the ultimate duration and economic impact of the Macroeconomic Conditions. Prolonged uncertainty with respect to the Macroeconomic Conditions could cause further economic slowdown or cause other unpredictable events, each of which could adversely affect our business, results of operations or financial condition.
Current wording
The global economy, credit markets and financial markets have and may continue to experience significant volatility as a result of the Macroeconomic Conditions. These Macroeconomic Conditions have and may continue to create supply chain disruptions, inventory disruptions, and fluctuations in economic growth, including fluctuations in employment rates, inflation, tariffs, energy prices and consumer sentiment. It remains difficult to assess or predict the ultimate duration and economic impact of the Macroeconomic Conditions. Prolonged uncertainty with respect to the Macroeconomic Conditions could cause further economic slowdown or cause other unpredictable events, each of which could adversely affect our business, results of operations or financial condition.
Previous wording
Non-GAAP adjusted EBITDA is a non-GAAP measure that represents our net income before interest expense, interest income, certain activity within other (expense) / income, net, provision for income taxes, amortization and depreciation expense, stock-based compensation expense, acquisition-related expense, legal costs and settlement fees incurred and received in connection with non-ordinary course litigation and other disputes, particularly costs involved in ongoing intellectual property litigation. We do not consider these items to be indicative of our core operating performance. The non-cash items include amortization and depreciation expense; amortization of debt issuance costs for the January 20, 2021 issuance of $500.0 million aggregate principal amount of 0% convertible senior notes due January 15, 2026, or the 2026 Notes, included in interest expense; amortization of debt issuance costs for the May 31, 2024 issuance of $500.0 million aggregate principal amount of 2.25% convertible senior notes due June 1, 2029, or the 2029 Notes, included in interest expense; and stock-based compensation expense related to restricted stock units and other forms of equity compensation, including, but not limited to, the sale of common stock. We do not adjust for ordinary course legal expenses resulting from maintaining and enforcing our intellectual property portfolio and license agreements.
Current wording
Non-GAAP adjusted EBITDA is a non-GAAP measure that represents our net income before interest expense, interest income, certain activity within other income / (expense), net, provision for income taxes, income from equity method investments, net, amortization and depreciation expense, stock-based compensation expense, acquisition-related expense, legal costs and settlement fees incurred and received in connection with non-ordinary course litigation and other disputes, particularly costs involved in ongoing intellectual property litigation. We do not consider these items to be indicative of our core operating performance. The non-cash items include amortization and depreciation expense; income from equity method investments, net; amortization of debt issuance costs for the January 20, 2021 issuance of $500.0 million aggregate principal amount of 0% convertible senior notes due January 15, 2026, or the 2026 Notes, included in interest expense; amortization of debt issuance costs for the May 31, 2024 issuance of $500.0 million aggregate principal amount of 2.25% convertible senior notes due June 1, 2029, or the 2029 Notes, included in interest expense; and stock-based compensation expense related to restricted stock units and other forms of equity compensation, including, but not limited to, the sale of common stock. We do not adjust for ordinary course legal expenses resulting from maintaining and enforcing our intellectual property portfolio and license agreements.
Previous wording
We record interest expense primarily related to our 2026 Notes and 2029 Notes. We exclude interest expense in calculating non-GAAP adjusted EBITDA because we believe the exclusion of interest expense will provide for more meaningful information about our financial performance. We exclude interest income and certain activity within other (expense) / income, net including gains, losses or impairments on investments without readily determinable fair values and other assets, gains and losses from equity method investments, gains on settlement fees and losses on the early extinguishment of debt, when applicable, from non-GAAP adjusted EBITDA because we do not consider it part of our ongoing results of operations. We exclude the impact related to our provision for income taxes from non-GAAP adjusted EBITDA because we do not consider this tax adjustment to be part of our ongoing results of operations.
Current wording
We record interest expense primarily related to our 2026 Notes and 2029 Notes. We exclude interest expense in calculating non-GAAP adjusted EBITDA because we believe the exclusion of interest expense will provide for more meaningful information about our financial performance. We exclude interest income and certain activity within other income / (expense), net including gains, losses or impairments on investments without readily determinable fair values and other assets, gains on settlement fees and losses on the early extinguishment of debt, when applicable, from non-GAAP adjusted EBITDA because we do not consider it part of our ongoing results of operations. We exclude the impact related to our provision for income taxes and income from equity method investments, net from non-GAAP adjusted EBITDA because we do not consider these adjustments to be part of our ongoing results of operations.
Previous wording
Our hardware and other revenue also includes our revenue from the sale of perpetual licenses that provide our customers in the commercial market the right to use our video surveillance software for an indefinite period of time in exchange for a one-time license fee. Additionally, our hardware and other revenue includes our revenue from the sale of licenses that provide our customers the right to use our indoor gunshot detection solution in exchange for license fees. Hardware and other revenue may also include activation fees charged to some of our service provider partners for activation of a new subscriber account on our platforms, as well as fees paid by service provider partners for our marketing services. The decision whether to charge an activation fee is based in part on the expected number of subscribers to be added by our service provider partners and as a result, many of our largest service provider partners do not pay an activation fee.
Current wording
Our hardware and other revenue also includes our revenue from the sale of perpetual licenses that provide our customers in the commercial market the right to use our video surveillance software for an indefinite period of time in exchange for a one-time license fee. Additionally, our hardware and other revenue includes our revenue from the sale of licenses that provide our customers the right to use our gunshot detection solution in exchange for license fees. Hardware and other revenue may also include activation fees charged to some of our service provider partners for activation of a new subscriber account on our platforms, as well as fees paid by service provider partners for our marketing services. The decision whether to charge an activation fee is based in part on the expected number of subscribers to be added by our service provider partners and as a result, many of our largest service provider partners do not pay an activation fee.
Previous wording
Our cost of SaaS and license revenue primarily includes the amounts paid to wireless network providers and, to a lesser extent, the costs of running our network operations centers which are expensed as incurred, as well as patent and royalty costs in connection with technology licensed from third-party providers and amounts paid to distributed energy resource providers. Our cost of SaaS and license revenue also includes our cost of software license revenue, which primarily includes the payroll and payroll-related costs of the department dedicated to providing service exclusively to those service providers that host the Software platform. As of December 31, 2024 and 2023, we had 74 and 77 employees who manufacture hardware for oursuite of IoT solutions, respectively. Our cost of hardware and other revenue primarily includes cost of raw materials, tooling, freight shipments and amounts paid to our third-party manufacturer for production and fulfillment of our cellular radio modules and image sensors, and procurement costs for our video cameras, video recorders, smart thermostats and gunshot detection sensors, which we purchase from an original equipment manufacturer, and other devices. Cost of hardware and other revenue also includes material costs and labor cost related to our employees who manufacture hardware for oursuite of IoT solutions. Additionally, our cost of hardware and other revenue includes royalty costs in connection with technology licensed from third-party providers.
Current wording
Our cost of SaaS and license revenue primarily includes the amounts paid to wireless network providers and, to a lesser extent, the costs of running our network operations centers which are expensed as incurred, as well as patent and royalty costs in connection with technology licensed from third-party providers and amounts paid to distributed energy resource providers. Our cost of SaaS and license revenue also includes our cost of software license revenue, which primarily includes the payroll and payroll-related costs of the department dedicated to providing service exclusively to those service providers that host the Software platform. As of December 31, 2025 and 2024, we had 66 and 74 employees who manufacture hardware for oursuite of IoT solutions, respectively. Our cost of hardware and other revenue primarily includes cost of raw materials, tooling, freight shipments and amounts paid to our third-party manufacturer for production and fulfillment of our cellular radio modules and image sensors, and procurement costs for our video cameras, video recorders, smart thermostats and gunshot detection sensors, which we purchase from an original equipment manufacturer, and other devices. Cost of hardware and other revenue also includes material costs and labor cost related to our employees who manufacture hardware for oursuite of IoT solutions. Additionally, our cost of hardware and other revenue includes royalty costs in connection with technology licensed from third-party providers.
Previous wording
Our operating expenses consist of sales and marketing, general and administrative, research and development and amortization and depreciation expenses. Salaries, bonuses, stock-based compensation, benefits and other personnel related costs are the most significant components of each of these expense categories, excluding amortization and depreciation. We include stock-based compensation expense in connection with the grant of restricted stock units and other forms of equity compensation, including equity compensation with performance conditions, in the applicable operating expense category based on the respective equity award recipient’s function (sales and marketing, general and administrative or research and development). We grew from 1,989 employees as of January 1, 2024 to 2,010 employees as of December 31, 2024. We expect to continue to hire new employees to support the projected future growth of our business.
Current wording
Our operating expenses consist of sales and marketing, general and administrative, research and development and amortization and depreciation expenses. Salaries, bonuses, stock-based compensation, benefits and other personnel related costs are the most significant components of each of these expense categories, excluding amortization and depreciation. We include stock-based compensation expense in connection with the grant of restricted stock units and other forms of equity compensation, including equity compensation with performance conditions, in the applicable operating expense category based on the respective equity award recipient’s function (sales and marketing, general and administrative or research and development). We grew from 2,010 employees as of January 1, 2025 to 2,058 employees as of December 31, 2025. We may continue to hire new employees to support the projected future growth of our business.
Previous wording
The number of employees in sales and marketing functions increased from 565 as of January 1, 2024 to 572 as of December 31, 2024. We expect to continue to invest in our sales and marketing activities to expand our business both domestically and internationally and we expect to increase our marketing expense in 2025 as compared to 2024. We intend to increase the size of our sales force and our service provider partner support team to provide additional support to our existing service provider partner base to drive their productivity in selling our solutions as well as to enroll new service provider partners in North America and in international markets.
Current wording
The number of employees in sales and marketing functions increased from 572 as of January 1, 2025 to 607 as of December 31, 2025. We expect to continue to invest in our sales and marketing activities to expand our business both domestically and internationally. We may increase the size of our sales force and our service provider partner support team to provide additional support to our existing service provider partner base to drive their productivity in selling our solutions as well as to enroll new service provider partners in North America and in international markets.
Previous wording
The number of employees in general and administrative functions increased from 229 as of January 1, 2024 to 237 as of December 31, 2024. Excluding intellectual property litigation and acquisition-related expense, we expect general and administrative costs to increase prospectively as our business grows. This includes cost increases related to human resources, accounting, finance, and legal personnel, additional external legal, audit fees and other expenses associated with regulations governing public companies. While somewhat unpredictable, we also expect to continue to incur costs related to litigation involving intellectual property. See the section of this Annual Report titled "Legal Proceedings" for additional information regarding litigation matters.
Current wording
The number of employees in general and administrative functions decreased from 237 as of January 1, 2025 to 235 as of December 31, 2025. Excluding intellectual property litigation and acquisition-related expense, we expect general and administrative costs to increase prospectively as our business grows. This includes cost increases related to human resources, accounting, finance, and legal personnel, additional external legal, audit fees and other expenses associated with regulations governing public companies. While somewhat unpredictable, we also expect to continue to incur costs related to litigation involving intellectual property. See the section of this Annual Report titled "Legal Proceedings" for additional information regarding litigation matters.
Previous wording
Research and Development Expense. Research and development expense consists primarily of personnel and related expenses for our employees working on our product development and software and device engineering teams, including salaries, bonuses, stock-based compensation, benefits and other personnel costs. Also included are non-personnel costs such as consulting and professional fees paid to third-party development resources.
Current wording
Research and Development Expense. Research and development expense consists primarily of personnel and related expenses for our employees working on our product development and software and device engineering teams as well as employees supporting research and development efforts, including salaries, bonuses, stock-based compensation, benefits and other personnel costs. Also included are non-personnel costs such as consulting and professional fees paid to third-party development resources.
Previous wording
The number of employees in research and development functions increased from 1,118 as of January 1, 2024 to 1,127 as of December 31, 2024. Our research and development efforts are focused on innovating new features and enhancing the functionality of our platforms and the solutions we offer to our service provider partners and subscribers. We will also continue to invest in efforts to extend our platforms to adjacent markets and internationally to maintain our leadership position in the development of intelligently connected property technology, and continued enhancement of our Partner Services Platform, a comprehensive suite of enterprise-grade business management solutions for our service provider partners.
Current wording
The number of employees in research and development functions increased from 1,127 as of January 1, 2025 to 1,150 as of December 31, 2025. Our research and development efforts are focused on innovating new features and enhancing the functionality of our platforms and the solutions we offer to our service provider partners and subscribers. We will also continue to invest in efforts to extend our platforms to adjacent markets and internationally to maintain our leadership position in the development of intelligently connected property technology, and continued enhancement of our Partner Services Platform, a comprehensive suite of enterprise-grade business management solutions for our service provider partners.
Previous wording
We record interest expense associated with our 2026 Notes, 2029 Notes and acquired debt. Interest expense in 2025 is expected to increase as compared to 2024 due to the issuance of the 2029 Notes.
Current wording
We record interest expense associated with our 2026 Notes and 2029 Notes. Interest expense in 2026 is expected to decrease as compared to 2025 due to the maturity of the 2026 Notes on January 15, 2026.
Previous wording
Other (expense) / income, net primarily consists of non-operating and miscellaneous expense and income.
Current wording
Other income / (expense), net primarily consists of non-operating and miscellaneous expense and income, including the impacts of fluctuations in foreign currency exchange rates as well as gains and losses on equity securities.
Previous wording
We are subject to U.S. federal, state and local income taxes as well as foreign income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. As a result, we recognize tax liabilities based on estimates of whether additional taxes will be due. For the year ended December 31, 2024, our effective tax rate was below the 21.0% statutory rate primarily due to research and development tax credits claimed, the foreign derived intangible income deduction and tax windfall benefits from employee stock-based compensation, partially offset by the impact of state taxes, foreign withholding taxes and other nondeductible expenses. We recognize stock-based compensation tax shortfalls and excess tax windfall benefits on a discrete basis during the quarter in which they occur, and we anticipate our effective tax rate will vary from quarter to quarter depending on our stock price as well as the vesting and exercises of various forms of equity compensation under our equity incentive plans each period, including restricted stock units and stock options.
Current wording
We are subject to U.S. federal, state and local income taxes as well as foreign income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. As a result, we recognize tax liabilities based on estimates of whether additional taxes will be due. For the year ended December 31, 2025, our effective tax rate was above the 21.0% statutory rate primarily due to the impact of state taxes, foreign withholding taxes and other nondeductible expenses, partially offset by the impact of 2025 research and development tax credits claimed and a favorable true-up adjustment of our 2024 income tax provision estimate associated with research and development tax credits. We recognize stock-based compensation tax shortfalls and excess tax windfall benefits on a discrete basis during the quarter in which they occur, and we anticipate our effective tax rate will vary from quarter to quarter depending on our stock price as well as the vesting and exercises of various forms of equity compensation under our equity incentive plans each period, including restricted stock units and stock options.
Previous wording
The following table sets forth our selected consolidated statements of operations (in thousands) and data as a percentage of revenue for the periods presented:
Current wording
The following table sets forth our selected consolidated statements of operations (in thousands) and data as a percentage of revenue for the periods presented. Certain previously reported amounts in the consolidated statements of operations for the year ended December 31, 2024 have been reclassified to conform to our current presentation to reflect income from equity method investments, net, as a separate line item, which was previously included in other income / (expense), net.
Previous wording
The $58.1 million increase in total revenue in 2024 as compared to 2023 was the result of a $62.0 million, or 11%, increase in our SaaS and license revenue and a $3.9 million, or 1%, decrease in our hardware and other revenue. Our software license revenue included within SaaS and license revenue decreased $2.9 million to $20.3 million in 2024 as compared to $23.2 million during 2023, primarily due to the result of the continuing transition of customers from non-hosted software to our cloud based hosted platform. The SaaS and license revenue for the Alarm.com segment increased $49.8 million in 2024 as compared to 2023 primarily due to growth in our subscriber base, including the revenue impact from subscribers we added in 2023, as well as an increase in our license revenue. The SaaS and license revenue for our Other segment increased $12.2 million in 2024 as compared to 2023 primarily due to an increase in sales of our energy management and demand response solutions as well as our property management solution. The decrease in hardware and other revenue in 2024 as compared to 2023 was primarily from the $3.3 million decrease in hardware and other revenue, net of intersegment eliminations, for the Alarm.com segment arising from a decrease in the volume of cameras sold. Hardware and other revenue, net of intersegment eliminations, in our Other segment decreased $0.6 million, in 2024 as compared to 2023 primarily due to decreased sales related to our property management solution.
Current wording
The $71.4 million increase in total revenue in 2025, as compared to 2024, was the result of a $58.2 million, or 9%, increase in our SaaS and license revenue and a $13.2 million, or 4%, increase in our hardware and other revenue. Our software license revenue included within SaaS and license revenue decreased $2.6 million to $17.7 million in 2025, as compared to $20.3 million during 2024, primarily due to the result of the continuing transition of customers from non-hosted software to our cloud based hosted platform. The SaaS and license revenue for the Alarm.com segment increased $40.7 million in 2025, as compared to 2024, primarily due to growth in our subscriber base, including the revenue impact from subscribers we added in 2024. The SaaS and license revenue for our Other segment increased $17.5 million in 2025, as compared to 2024, primarily due to an increase in sales of our energy management and demand response solutions as well as our property management solution. Hardware and other revenue, net of intersegment eliminations, in our Alarm.com segment increased $8.2 million in 2025, as compared to 2024, primarily due to the increases in the sale of perpetual licenses related to our video surveillance software as well as price increases we have implemented on certain products to cover a portion of our increases in costs. Hardware and other revenue, net of intersegment eliminations, in our Other segment increased $5.0 million in 2025, as compared to 2024, primarily due to sales of energy credits related to the acquisition of BTR as well as an increase in sales related to our property management solution.
Previous wording
The $1.0 million increase in cost of revenue in 2024 as compared to 2023 was the result of a $3.6 million, or 4%, increase in cost of SaaS and license revenue and a $2.6 million, or 1%, decrease in cost of hardware and other revenue. Our cost of software license revenue included within cost of SaaS and license revenue remained relatively consistent at $0.6 million during 2024 and 2023. The cost of SaaS and license revenue for the Alarm.com segment increased $0.3 million in 2024 as compared to 2023 primarily due to the growth in our subscriber base, which drove a corresponding increase in amounts paid to wireless network providers. The cost of SaaS and license revenue for the Other segment increased $3.3 million in 2024 as compared to 2023 primarily due to an increase in sales of our energy management and demand response solutions, which drove a corresponding increase in amounts paid to distributed energy resource providers.The cost of hardware and other revenue for the Alarm.com segment decreased $2.1 million in 2024 as compared to 2023 primarily due to a decrease in the number of hardware units shipped. The cost of hardware and other revenue for the Other segment decreased $0.5 million in 2024 as compared to 2023 primarily due to a decrease in the number of hardware units shipped.
Current wording
The $16.1 million increase in cost of revenue in 2025, as compared to 2024, was the result of a $9.5 million, or 4%, increase in cost of hardware and other revenue, and a $6.6 million, or 7%, increase in cost of SaaS and license revenue. Our cost of software license revenue included within cost of SaaS and license revenue was $0.4 million and $0.6 million during 2025 and 2024, respectively. The cost of hardware and other revenue for the Alarm.com segment increased $4.9 million in 2025, as compared to 2024, primarily due to an increase in the number of hardware units sold related to our video surveillance software. The cost of hardware and other revenue for the Other segment increased $4.6 million in 2025, as compared to 2024, primarily due to costs associated with sales of energy credits related to the acquisition of BTR and an increase in the number of hardware units shipped related to our property management solution. The cost of SaaS and license revenue for the Other segment increased $5.3 million in 2025, as compared to 2024, primarily due to an increase in sales of our energy management and demand response solutions, which drove a corresponding increase in amounts paid to distributed energy resource providers. The cost of SaaS and license revenue for the Alarm.com segment increased $1.3 million in 2025, as compared to 2024, primarily due to the growth in our subscriber base, which drove a corresponding increase in amounts paid to wireless network providers.
Previous wording
Cost of hardware and other revenue as a percentage of hardware and other revenue was 77% in 2024 and 2023. Cost of SaaS and license revenue as a percentage of SaaS and license revenue was 14% and 15% in 2024 and 2023, respectively. The decrease in cost of SaaS and license revenue as a percentage of SaaS and license revenue in 2024 as compared to 2023 is a reflection of the mix of sales and services during the periods. Cost of software license revenue as a percentage of software license revenue was 3% in 2024 and 2023.
Current wording
Cost of hardware and other revenue as a percentage of hardware and other revenue was 76% and 77% in 2025 and 2024, respectively. Cost of SaaS and license revenue as a percentage of SaaS and license revenue was 14% and 14% in 2025 and 2024, respectively. The decrease in cost of SaaS and license revenue as a percentage of SaaS and license revenue in 2025, as compared to 2024, is a reflection of the mix of sales and services during the periods. Cost of software license revenue as a percentage of software license revenue was 2% and 3% in 2025 and 2024, respectively.
Previous wording
The $11.0 million increase in sales and marketing expense in 2024 as compared to 2023 was primarily due to a $3.7 million increase in personnel and related costs for our Alarm.com segment, attributable in part to increases in the headcount for our sales team to support our growth, and a $3.5 million increase in marketing expense for our Alarm.com segment. These increases in sales and marketing expense for our Alarm.com segment were partially offset by a $0.7 million decrease in our expenses for external consultants in 2024 as compared to 2023. Sales and marketing expense from our Other segment increased $4.8 million in 2024 as compared to 2023, primarily due to increases in personnel and related costs, attributable in part to increases in the headcount for our sales team. The overall number of employees in our sales and marketing teams increased from 565 as of December 31, 2023 to 572 as of December 31, 2024.
Current wording
The $12.5 million increase in sales and marketing expense in 2025, as compared to 2024, was primarily due to a $6.2 million increase in personnel and related costs for our Alarm.com segment, attributable in part to increases in the headcount for our sales team to support our growth, and a $2.4 million increase in marketing expense for our Alarm.com segment. Sales and marketing expense from our Other segment increased $3.4 million in 2025, as compared to 2024, primarily due to increases in personnel and related costs, attributable in part to increases in the headcount for our sales team. The overall number of employees in our sales and marketing teams increased from 572 as of December 31, 2024, to 607 as of December 31, 2025.
Previous wording
The $4.1 million decrease in general and administrative expense in 2024 as compared to 2023 was primarily due to a $16.1 million decrease in legal costs for our Alarm.com segment related to intellectual property litigation. This decrease in general and administrative expense was partially offset by a $4.0 million increase in the provision for credit losses related to a loan we previously provided to an affiliated entity of one of our distribution partners, a $3.9 million increase in expenses related to a program to help our service providers resell our solutions and hardware to our subscribers, a $1.1 million increase in personnel and related costs, a $0.9 million increase in rent expense and a $0.7 million increase in recruiting costs and in 2024 as compared to 2023. General and administrative expenses from our Other segment increased by $1.5 million during 2024 as compared to 2023, primarily due to an increase in personnel and related costs. The overall number of employees in general and administrative functions increased from 229 as of December 31, 2023 to 237 as of December 31, 2024.
Current wording
The $1.5 million increase in general and administrative expense in 2025, as compared to 2024, was primarily due to a $3.1 million increase in our expenses for external consultants and a $2.5 million increase in personnel and related costs for our Alarm.com segment. These increases in general and administrative expense are partially offset by a $2.8 million decrease in the provision for credit losses for our Alarm.com segment primarily related to credit loss expense recorded in 2024 related to a loan we previously provided to an affiliated entity of one of our distribution partners that did not occur in 2025, as well as a decrease of $1.1 million in recruiting costs for our Alarm.com segment. General and administrative expenses from our Other segment increased by $0.3 million in 2025, as compared to 2024, primarily due to an increase in legal costs. The overall number of employees in general and administrative functions decreased from 237 as of December 31, 2024, to 235 as of December 31, 2025.
Previous wording
The $10.8 million increase in research and development expense in 2024 as compared to 2023 was primarily due to a $5.7 million increase in personnel and related costs for our Alarm.com segment, attributable in part to an increase in headcount of employees in research and development functions as well as a $2.4 million increase in our expenses for external consultants. Research and development expense from our Other segment increased by $3.3 million in 2024 as compared to 2023 primarily due to an increase in our personnel and related costs. The overall number of employees in research and development functions increased from 1,118 as of December 31, 2023 to 1,127 as of December 31, 2024.
Current wording
The $14.4 million increase in research and development expense in 2025, as compared to 2024, was primarily due to a $4.3 million increase in personnel and related costs for our Alarm.com segment, attributable in part to an increase in headcount of employees in research and development functions, a $3.5 million increase in our expenses for external consultants and a $2.0 million increase in expenses for software licenses for our Alarm.com segment. Research and development expense from our Other segment increased by $3.0 million in 2025, as compared to 2024, primarily due to an increase in personnel and related costs. The overall number of employees in research and development functions increased from 1,127 as of December 31, 2024, to 1,150 as of December 31, 2025.
Previous wording
Interest expense increased $8.0 million in 2024 as compared to 2023, primarily due to the interest expense and amortization of the debt issuance costs related to the 2029 Notes.
Current wording
Interest expense increased $5.9 million in 2025 as compared to 2024, primarily due to the interest expense and amortization of the debt issuance costs related to the 2029 Notes.
Previous wording
The provision for income taxes increased $1.8 million in 2024 as compared to 2023. Our effective tax rate was 13.6% in 2024 as compared to 17.9% in 2023. The increase in the provision for income taxes was primarily due to the increase in income before income taxes, partially offset by an increase in our research and development income tax credits and windfall benefits from employee stock-based compensation.
Current wording
The provision for income taxes increased $18.3 million in 2025 as compared to 2024. Our effective tax rate was 22.6% in 2025 as compared to 13.6% in 2024. The increase in the provision for income taxes was primarily due to the increase in income before income taxes, a reduction in our foreign derived intangible income deduction and our research and development tax credits, a tax shortfall in employee stock-based compensation in 2025 as opposed to a windfall tax benefit recognized in 2024 and a less favorable true-up adjustment of our 2024 income tax provision estimate associated with research and development tax credits recorded in 2025 as compared to a similar true-up adjustment of our 2023 income tax provision estimate associated with research and development tax credits recorded in 2024.
Previous wording
We have two reportable segments: Alarm.com and Other. Our Alarm.com segment represents our cloud-based and Software platforms for the intelligently connected property and related solutions that contributed 92%, 93% and 94% of our revenue, net of intersegment eliminations, for the years ended December 31, 2024, 2023 and 2022, respectively. Our Other segment is focused on researching, developing and offering residential and commercial automation solutions and energy management products and services in adjacent markets. The consolidated subsidiaries that make up our Other segment are in the investment stage and have incurred significant operating expenses relative to their revenue.
Current wording
We have two reportable segments: Alarm.com and Other. Our Alarm.com segment represents our cloud-based and Software platforms for intelligently connected properties and related solutions that contributed 91%, 92% and 93% of our revenue, net of intersegment eliminations, for the years ended December 31, 2025, 2024 and 2023, respectively. Our Other segment is focused on researching, developing and offering residential and commercial automation solutions and energy management products and services in adjacent markets. The consolidated subsidiaries that make up our Other segment are in the investment stage and have incurred significant operating expenses relative to their revenue.
Previous wording
Our Alarm.com segment decreased from 1,776 employees as of January 1, 2024 to 1,773 employees as of December 31, 2024. Our Other segment increased from 213 employees as of January 1, 2024 to 237 employees as of December 31, 2024. Inter-segment revenue includes sales of hardware between our segments.
Current wording
Our Alarm.com segment decreased from 1,773 employees as of January 1, 2025 to 1,768 employees as of December 31, 2025. Our Other segment increased from 237 employees as of January 1, 2025 to 290 employees as of December 31, 2025. Inter-segment revenue includes sales of hardware between our segments.
Previous wording
Our SaaS and license revenue for the Alarm.com segment included software license revenue of $20.3 million, $23.2 million and $26.8 million for the years ended December 31, 2024, 2023 and 2022, respectively. There was no software license revenue recorded for the Other segment during the years ended December 31, 2024, 2023 and 2022. Additions to property and equipment were $20.1 million, $8.9 million and $28.4 million for the Alarm.com segment for the years ended December 31, 2024, 2023 and 2022, respectively. Additions to property and equipment were $0.1 million, $0.2 million and $0.3 million for the Other segment for the years ended December 31, 2024, 2023 and 2022, respectively.
Current wording
Our SaaS and license revenue for the Alarm.com segment included software license revenue of $17.7 million, $20.3 million and $23.2 million for the years ended December 31, 2025, 2024 and 2023, respectively. There was no software license revenue recorded for the Other segment during the years ended December 31, 2025, 2024 and 2023. Cash additions to property and equipment were $16.2 million, $10.0 million and $7.4 million for the Alarm.com segment for the years ended December 31, 2025, 2024 and 2023, respectively. Cash additions to property and equipment were less than $0.1 million for the Other segment for the year ended December 31, 2025, and were $0.1 million for the years ended December 31, 2024 and 2023.
Previous wording
We have variable consideration primarily in the form of rebate incentives, which contain uncertainties and require us to make estimates of the amount of consideration to which we will be entitled. The significant inputs related to our estimates of variable consideration include the volume and amount of products and services sold historically and expected to be sold in the future, the availability and performance of our services and the historical and expected number of returns. We record a reserve against revenue for hardware returns based on historical returns. For each of the years ended December 31, 2024, 2023 and 2022, our reserve against revenue for hardware returns was 1% of hardware and other revenue. We evaluate our hardware reserve on a quarterly basis or if there is an indication of significant changes in return experience. Historically, our returns of hardware have not significantly differed from our estimated reserve.
Current wording
We have variable consideration primarily in the form of rebate incentives, which contain uncertainties and require us to make estimates of the amount of consideration to which we will be entitled. The significant inputs related to our estimates of variable consideration include the volume and amount of products and services sold historically and expected to be sold in the future, and the availability and performance of our services.
Previous wording
Significant estimates and assumptions in valuing certain acquired customer relationship intangible assets include estimates about future expected cash flows and discount rates. Significant estimates and assumptions in valuing acquired developed technology intangible assets include estimates about future expected cash flows, obsolescence factors and discount rates. Significant estimates and assumptions in valuing acquired trade name intangible assets include estimates about future expected cash flows, royalty rates and discount rates.
Current wording
Significant estimates and assumptions in valuing certain acquired customer relationship intangible assets include estimates about future expected cash flows, attrition rates and discount rates. Significant estimates and assumptions in valuing acquired developed technology intangible assets include estimates about future expected cash flows, obsolescence factors, royalty rates and discount rates. Significant estimates and assumptions in valuing acquired trade name intangible assets include estimates about future expected cash flows, royalty rates and discount rates.
Previous wording
We did not make any material changes to the underlying assumptions used as of the acquisition date to calculate the purchase price of the business combinations that occurred during 2023 and 2022. We do not expect any changes to the underlying assumptions used to calculate the purchase price of those business combinations as the purchase price allocation was finalized for these business combinations.
Current wording
We did not make any material changes to the underlying assumptions used as of the acquisition date to calculate the purchase price of the business combinations that occurred during 2025 and 2023. We do not expect any changes to the underlying assumptions used to calculate the purchase price of those business combinations, in part, because the purchase price allocation was finalized for some of these business combinations.
Showing the first 40 of 63 pairs. Open the source sections for the rest.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
We generally offer customers a limited right of return for hardware that has been purchased from us. We record a reserve against revenue for hardware returns based on historical returns. For each of the years ended December 31, 2025, 2024 and 2023, our reserve against revenue for hardware returns was 1% of hardware and other revenue. We evaluate our hardware reserve on a quarterly basis or if there is an indication of significant changes in return experience. Historically, our returns of hardware have not significantly differed from our estimated reserve and while we do not expect any material changes in the near term to the underlying assumptions used to recognize our reserve against revenue for hardware returns, if changes in these assumptions occur, and, should those changes be significant, they could have a material impact on our hardware and other revenue.
Current report — wording carried from elsewhere
2026 Notes for such trading day was less than 98% of the product of the last reported sale price of our common stock and the conversion rate for the 2026 Notes on each such trading day; (3) if we call any or all of the 2026 Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the 2026 Notes called (or deemed called) for redemption; or (4) upon the occurrence of specified corporate events as set forth in the 2026 Indenture.
Current report — wording carried from elsewhere
On December 3, 2020, our board of directors authorized a stock repurchase program, under which we were authorized to purchase up to an aggregate of $100.0 million of our outstanding common stock during the three-year period ending December 3, 2023. On February 15, 2023, our board of directors authorized the cancellation of the balance under the stock repurchase program ending December 3, 2023, and also authorized a stock repurchase program, effective February 23, 2023, under which we were authorized to purchase up to an aggregate of $100.0 million of our outstanding common stock during the two-year period ending February 23, 2025.
Current report — wording carried from elsewhere
For 2025, cash flows used in financing activities was $55.0 million, compared to cash flows from financing activities of $346.4 million in 2024. The $401.4 million decrease in cash flows from in financing activities was primarily due to the $485.2 million in proceeds received from the issuance of the 2029 Notes, net of issuances costs paid in 2024, which did not occur in 2025. These decreases in cash flows from financing activities were partially offset by a $33.4 million decrease in purchases of shares of our common stock in 2025 as compared to 2024, and $63.1 million purchases of capped calls related to the 2029 Notes in 2024, which did not occur in 2025.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
On January 30, 2025, we entered into a senior secured loan agreement with a service provider partner, under which a term loan was provided to the service provider partner in the original principal amount of $21.5 million, which loan is collateralized by the assets of the service provider partner. Quarterly principal payments begin in the second quarter of 2027. Interest on the outstanding principal accrues at a rate per annum equal to the overnight financing rate published by the Federal Reserve Bank of New York for a period of three months, plus 3.0%. For the first two years of the loan, monthly interest payments can be payable in kind at the election of the borrower. The maturity date of the loan is January 30, 2030.
Previous report — wording carried elsewhere
In consideration for the purchase of 81% of the issued and outstanding shares of capital stock of CHeKT, we paid $23.6 million in cash on February 10, 2025, after deducting $3.7 million related to agreed holdback provisions. We are currently evaluating the accounting treatment of this acquisition and are in the process of completing the preliminary purchase price allocation of the assets acquired and liabilities assumed.
Previous report — wording carried elsewhere
For 2023, cash flows used in investing activities was $26.0 million, compared to $68.3 million in 2022. The $42.3 million decrease in cash used in investing activities was primarily due to the $31.9 million paid to purchase 85% of the issued and outstanding shares of capital stock of Noonlight and the $21.8 million paid for developable land during 2022, which did not occur during 2023. These decreases in cash used in investing activities were partially offset by $9.7 million paid to purchase 100% of the issued and outstanding shares of capital stock of EBS, net of cash acquired, and the $5.9 million paid to purchase certain assets from Vintra, including direct transaction costs, in 2023, which did not occur in 2022.