RESIDEO TECHNOLOGIES, INC.
For the period ended Sep 27, 2025. Filed Nov 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 27, 2025 · Filed Nov 5, 2025
REZI$19.40-1.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-28; filed 2025-08-05.
0001740332-25-000024
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-27; filed 2025-11-05.
0001740332-25-000034
Item 2. 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 138 previous paragraphs and 135 current paragraphs.
70 unchanged; 46 reworded; 19 added; 22 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 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 (19)
Current report
•our ability to obtain additional future capital on favorable terms or at all;
Current report
•the failure to acquire, implement, maintain and upgrade business technology infrastructure systems, including Enterprise Resource Planning (“ERP”) systems and the like;
Current report
Net revenue for the three months ended September 27, 2025 was $1,864 million, an increase of $36 million, or 2.0%, from the same period in 2024, primarily due to $50 million of revenue from favorable price and mix, and $13 million from favorable foreign currency exchange rates. The increase was partially offset by a $28 million decrease from lower sales volume.
Current report
Selling, general and administrative expenses for the three months ended September 27, 2025 were $324 million, an increase of $7 million, or 2.2%, as compared to the same period in 2024. The increase was primarily driven by $6 million of incremental operating costs including payroll and benefits, rent and third party spend, and $4 million of expenses related to the announced future ADI Spin-Off. The increase was partially offset by a net reduction in bad debt expense of $5 million primarily driven by the Product and Solutions segment.
Current report
Restructuring, impairment and extinguishment costs for the nine months ended September 27, 2025 were $9 million, a decrease of $38 million, or 80.9%, as compared to the same period in 2024. The decrease was primarily due to $35 million of restructuring costs incurred in the prior year for various restructuring actions, including capturing synergies from the Snap One acquisition. In addition, we incurred $6 million of debt extinguishment costs as part of the Snap One acquisition, and $5 million in impairment expense related to an equity security in the prior year. The decrease was partially offset by $6 million in restructuring expenses related to the Products and Solutions and ADI Segments, and $3 million of debt extinguishment and modification costs related to Corporate incurred during the nine months ended September 27, 2025.
Current report
We incurred no Indemnification Agreement expense for the three months ended September 27, 2025, a decrease of $45 million compared to the same period of 2024. The decrease was driven by the termination of the Indemnification Agreement with Honeywell on July 30, 2025.
Current report
Other expenses, net for the three months ended September 27, 2025 were $7 million, a decrease of $3 million as compared to the same period in 2024. The decrease was primarily driven by a $3 million loss on the sale of certain assets and related liabilities in the Products and Solutions segment in the prior year.
Current report
Other expenses, net for the nine months ended September 27, 2025 were $22 million, an increase of $12 million as compared to the same period in 2024. The increase was primarily driven by $15 million in unfavorable foreign currency exchange rates, and a $4 million gain from the sale of an investment in the prior year. The increase was partially offset by a $8 million loss on sale of certain assets and related liabilities in the Products and Solutions segment in the prior year.
Current report
Tax (Benefit) Expense
Current report
The chart below presents net revenue and income from operations for the nine months ended September 27, 2025 and September 28, 2024.
Current report
ADI Global Distribution income from operations for the three months ended September 27, 2025 was $56 million, an increase of $20 million, or 55.6%, as compared to the same period in 2024. The increase was primarily driven by $30 million from net favorable price and mix shift, and $17 million lower restructuring expenses. This increase was partially offset by incremental research and development expenses of $11 million and a decrease in sales volumes of $4 million. In addition, operating expenses increased by $9 million, including payroll, freight, and duties, driven primarily by the one-time impacts from our ERP implementation.
Current report
The chart below presents net revenue and income from operations for the nine months ended September 27, 2025 and September 28, 2024.
Current report
ADI Global Distribution income from operations for the nine months ended September 27, 2025 was $161 million, an increase of $14 million, or 9.5%, as compared to the same period in 2024. The increase was primarily driven by $36 million from net favorable price and mix shift, $17 million from higher sales volumes, and $14 million from lower restructuring costs. This increase was partially offset by investment of $28 million in research and development costs. In addition, operating expenses increased by $29 million, including payroll and benefits, rent, bad debt, third party spend, and freight and duties.
Current report
Corporate costs for the three months ended September 27, 2025 were $42 million, an increase of $4 million, or 10.5%, as compared to the same period in 2024. The increase was primarily driven by $4 million of expenses related to the announced future ADI Spin-Off.
Current report
In August 2025, subject to the terms and conditions of the Termination Agreement, we made a pre-tax, one-time cash payment of $1,590 million to Honeywell. This was partially financed in the amount of $1,225 million in incremental term loans under our A&R Credit Agreement, which mature in August 2032. The remainder of the payment to Honeywell was financed with our existing cash. Refer to Note 12. Long-Term Debt and Note 16. Commitments and Contingencies to the Unaudited Consolidated Financial Statements for further discussion.
Current report
A&R Credit Agreement and Senior Notes
Current report
In August 2025, we issued $1,225 million in incremental term loans under our A&R Credit Agreement to partially finance our settlement of the Termination Agreement with Honeywell.
Current report
For the nine months ended September 27, 2025, net cash used for operating activities was $1,436 million, a decrease of $1,677 million as compared to the same period in 2024. During the nine months ended September 27, 2025, we recorded $972 million of expense related to the termination of the Indemnification Agreement, $86 million of interest expense and $22 million of other expenses. These expenses, offset by operating profit of $467 million, were the primary drivers of the net loss of $663 million. In addition to the decrease in net income of $756 million, there was a change of $923 million in net assets and liabilities driven primarily by a $753 million decrease in the Indemnification Agreement liability and a $120 million decrease in accounts payable primarily due to the timing of payments for strategic buys.
Current report
Net cash provided by financing activities for the nine months ended September 27, 2025 was $1,159 million, an increase of $116 million, or 11%, as compared to the same period in 2024. This increase was primarily driven by a $599 million reduction in long-term debt repayments, partially offset by proceeds of $482 million related to the issuance of Preferred Stock in 2024.
Removed paragraphs (22)
Previous report
•risks that the termination of the Indemnification Agreement contemplated by the Termination Agreement with Honeywell does not occur because we are not able to raise the necessary financing or otherwise;
Previous report
•Cash flow generated from operations was $200 million in the second quarter of 2025, compared to $92 million in the second quarter of 2024
Previous report
Net revenue for the six months ended June 28, 2025 was $3,713 million, an increase of $638 million, or 20.7%, from the same period in 2024, primarily due to $446 million of revenue from the acquisition of Snap One, $114 million from higher sales volume, and $83 million from favorable price and mix.
Previous report
Selling, general and administrative expenses for the three months ended June 28, 2025 were $319 million, an increase of $39 million, or 13.9%, as compared to the same period in 2024. The increase was primarily driven by $20 million from the inclusion of Snap One, net of prior year acquisition and integration costs, and $17 million of incremental operating costs, including payroll and benefits, rent, marketing, and third party spend.
Previous report
Restructuring, impairment and extinguishment costs for the six months ended June 28, 2025 were $6 million, a decrease of $12 million, or 66.7%, as compared to the same period in 2024. The decrease was primarily due to $6 million of debt extinguishment costs as part of the Snap One acquisition, and $5 million of impairment expense related to an equity security incurred in the prior year.
Previous report
Indemnification Agreement expense for the three months ended June 28, 2025 was $882 million, up $835 million from the $47 million recorded in the same period of 2024. The increase was driven by the recognition of additional expense in connection with our agreement to terminate the Indemnification Agreement with Honeywell. This expense reflects the revised estimate of our liability under the agreement of $1,625 million.
Previous report
Other expenses, net for the three months ended June 28, 2025 were $9 million, an increase of $8 million as compared to the same period in 2024. The increase was primarily driven by $7 million in unfavorable foreign currency exchange rates.
Previous report
Other expenses, net for the six months ended June 28, 2025 were $15 million, an increase of $15 million as compared to the same period in 2024. The increase was primarily driven by $16 million in unfavorable foreign currency exchange rates.
Previous report
Tax Expense
Previous report
The chart below presents net revenue and income from operations for the six months ended June 28, 2025 and June 29, 2024.
Previous report
ADI Global Distribution income from operations for the three months ended June 28, 2025 was $71 million, an increase of $9 million, or 14.5%, as compared to the same period in 2024. The increase was primarily driven by a $97 million increase in gross profit driven by the inclusion of Snap One, higher volumes, and net favorable price and mix shift. This increase was partially offset by an $87 million increase in operating expenses, including $61 million of selling, general and administrative expenses, $17 million of amortization, and $9 million of incremental research and development cost. These increases were primarily due to the inclusion of Snap One and incremental operating costs at the segment.
Previous report
The chart below presents net revenue and income from operations for the six months ended June 28, 2025 and June 29, 2024.
Previous report
ADI Global Distribution income from operations for the six months ended June 28, 2025 was $105 million, down $6 million, or 5.4%, as compared to the same period in 2024. The decrease was primarily due to $186 million increase in operating expenses, including $132 million of selling, general and administrative expenses, $37 million of amortization, and $17 million of research and development cost. These increases were primarily due to the inclusion of Snap One and incremental operating costs at the segment. This decrease was partially offset by an $183 million increase in gross profit driven by the inclusion of Snap One, higher volumes and net favorable price and mix shift.
Previous report
Corporate costs for the three months ended June 28, 2025 were $36 million, a decrease of $34 million, or 48.6%, as compared to the same period in 2024. The decrease was driven by $29 million of acquisition and integration costs, $6 million of debt extinguishment costs as part of the Snap One acquisition, and $5 million of impairment expense related to an equity security incurred in the prior year. The decrease was partially offset by incremental operating costs of $6 million including payroll and benefits, and third party spend.
Previous report
To fulfill our obligation under the Termination Agreement, we intend to use the proceeds from newly raised debt financing as contemplated by the Debt Commitment Letter, together with cash on hand. To the extent that we are not able to raise the necessary financing by August 29, 2025, Honeywell may cancel the Termination Agreement and reinstate the Indemnification Agreement. In the event we do not raise the necessary financing by October 30, 2025, we also have the right to cancel the Termination Agreement and reinstate the Indemnification Agreement. Upon termination by either party, we will owe Honeywell $100 million in liquidated damages. Refer to Note 16. Commitments and Contingenciesfor further discussion.
Previous report
Credit Agreement
Previous report
Senior Notes
Previous report
In August 2021, we issued $300 million in principal amount of 4.000% Senior Notes due in 2029.
Previous report
In July 2024, we issued $600 million in aggregate principal of 6.500% Senior Notes due 2032.
Previous report
Covenant Compliance
Previous report
Net cash provided by operating activities for the six months ended June 28, 2025 was $135 million. Compared to the six months ended June 29, 2024, net cash provided by operating activities increased $41 million. During the six months ended June 28, 2025, we recorded $972 million of expense related to the termination of the Indemnification Agreement which was the primary driver of the net loss of $819 million compared to $73 million of net income in the comparative period. This change of $892 million was partially offset by higher non-cash charges of $42 million primarily due to a $44 million increase in depreciation and amortization, and favorable changes of $891 million in assets and liabilities. These changes in assets and liabilities were primarily due to a $902 million increase in the Indemnification Agreement liability from its termination, and a $73 million increase in accrued liabilities primarily due to an increase in taxes payable. This was partially offset by an unfavorable change in other assets and liabilities of $62 million primarily due to increases in deferred tax assets and lease right-of-use assets and $85 million of increased accounts receivable primarily due to higher sales.
Previous report
Net cash used for financing activities for the six months ended June 28, 2025 was $33 million. Compared to the six months ended June 29, 2024, net cash used by financing activities decreased $1,085 million, primarily due to a decrease in proceeds from the term loan borrowings of $582 million and Preferred Stock issuance of $482 million when compared to the prior year and an increase in preferred stock dividend payments of $17 million in the current year.
Reworded paragraphs (46)
Previous wording
•inability to successfully execute transformation programs or to effectively manage our workforce;
Current wording
•inability to successfully execute restructuring or transformation programs or to effectively manage our workforce;
Previous wording
•prior to its pending termination, risks associated with the Indemnification Agreement and our relationships with Honeywell, including our reliance on Honeywell for the Honeywell Home trademark;
Current wording
•risks associated with our relationships with Honeywell, including our reliance on Honeywell for the Honeywell Home trademark;
Previous wording
•our ability to maintain effective internal controls, deliver timely financial statements, and avoid the financial statements to become impaired and damage public opinion;
Current wording
•our ability to maintain effective internal controls and deliver timely financial statements;
Previous wording
Our ADI Global Distribution segment is the leading global wholesale distributor of low-voltage products, including security and audio-visual solutions. With a portfolio of over 500,000 professionally installed products, ADI Global Distribution serves both the commercial and residential markets across key specialty categories including security, fire, audio-visual, access control, smart living, and data communications. This extensive offering is complemented by an expanding suite of proprietary technologies and services, under key exclusive brands such as Control4, OvrC, Araknis Networks, and WattBox.
Current wording
Our ADI Global Distribution segment is the leading global wholesale distributor of low-voltage products, including security and audio-visual solutions. With a portfolio of over 500,000 professionally installed products, ADI Global Distribution serves both the commercial and residential markets across key specialty categories including security, fire, audio-visual, access control, smart living, and data communications. This extensive offering is complemented by an expanding suite of proprietary technologies and services, under key exclusive brands such as Araknis Networks, Control4, OvrC, and WattBox.
Previous wording
•Net revenue of $1.94 billion, up 22.3% from $1.59 billion in the second quarter of 2024
Current wording
•Net revenue of $1.86 billion, up 2.0% from $1.83 billion in the third quarter of 2024
Previous wording
•Gross profit margin of 29.3%, compared to 28.1% in the second quarter of 2024
Current wording
•Gross profit margin of 29.8%, compared to 28.7% in the third quarter of 2024
Previous wording
•Income from operationsof $177 million, or 9.1% of revenue, compared to $122 million, or 7.7% of revenue in thesecond quarter of 2024
Current wording
•Income from operationsof $154 million, or 8.3% of revenue, compared to $126 million, or 6.9% of revenue in thethird quarter of 2024
Previous wording
•Fully diluted loss per common share of $5.59, compared to $0.19 diluted earnings per common share in thesecond quarter of 2024
Current wording
•Fully diluted earnings per common share of $0.85, compared to $0.07 diluted earnings per common share in thethird quarter of 2024
Previous wording
For the remainder of 2025, we anticipate executing our business operations against a highly dynamic global macroeconomic environment. The vast majority of costs associated with the building products that the Products and Solutions segment sells in the U.S. are incurred in Mexico. Most Products and Solutions products manufactured in Mexico, along with a significant portion of the ADI Global Distribution segment products sourced in Mexico, are currently exempt from tariffs under the United States-Mexico-Canada Agreement (USMCA). Additional tariff impact relates to products imported from China (and other Asian countries) and the European Union primarily by our ADI Global Distribution segment. We intend to take actions to essentially mitigate the cost impact of any tariffs that affect our business; however, rising prices and other macroeconomics factors may lead to lower purchase levels by our customers. We are monitoring these dynamics very closely and will make adjustments in our business operation execution, as appropriate. Based on the aforementioned, we updated our 2025 revenue outlook to be up low double-digits year-over-year. On July 30, 2025, we also entered into an agreement with Honeywell to accelerate and eliminate all future monetary obligations under the Indemnification Agreement and entered into the Debt Commitment Letter to partially fund the termination. Refer to Note 16. Commitments and Contingenciesand Note 19. Subsequent Eventsfor further discussion.
Current wording
For the remainder of 2025, we anticipate executing our business operations against a highly dynamic global macroeconomic environment. The vast majority of costs associated with the building products that the Products and Solutions segment sells in the U.S. are incurred in Mexico. Most Products and Solutions products manufactured in Mexico, along with a significant portion of the ADI Global Distribution segment products sourced in Mexico, are currently exempt from tariffs under the United States-Mexico-Canada Agreement (USMCA). Additional tariff impact relates to products imported from China (and other Asian countries) and the European Union primarily by our ADI Global Distribution segment. We intend to take actions to essentially mitigate the cost impact of any tariffs that affect our business; however, rising prices and other macroeconomics factors may lead to lower purchase levels by our customers. We are monitoring these dynamics very closely and will make adjustments in our business operation execution, as appropriate. Based on the aforementioned, we reaffirm our 2025 revenue outlook to be up low double-digits year-over-year.
Previous wording
Net revenue for the three months ended June 28, 2025 was $1,943 million, an increase of $354 million, or 22.3%, from the same period in 2024, primarily due to $218 million of revenue from the acquisition of Snap One, $64 million from favorable price and mix, $63 million from higher sales volume, and $11 million from favorable foreign currency exchange rates.
Current wording
Net revenue for the nine months ended September 27, 2025 was $5,577 million, an increase of $674 million, or 13.7%, from the same period in 2024, primarily due to $446 million of revenue from the acquisition of Snap One, $134 million from favorable price and mix, $86 million from higher sales volume, and $11 million from favorable foreign currency exchange rates.
Previous wording
Gross profit for three months ended June 28, 2025 was $569 million, an increase of $122 million, or 27.3%, as compared to the same period in 2024, as shown in the above waterfall.
Current wording
Gross profit for the three months ended September 27, 2025 was $556 million, an increase of $32 million, or 6.1%, as compared to the same period in 2024, as shown in the above waterfall.
Previous wording
Gross margin rate for the three months ended June 28, 2025 was 29.3%, an increase of 120 basis points (“bps”) as compared to the same period in 2024. The increase was primarily driven by favorable price and mix shift of 120 bps, and the acquisition of Snap One of 80 bps. The increase was partially offset by lower margins on new volumes of 70 bps.
Current wording
Gross margin rate for the three months ended September 27, 2025 was 29.8%, an increase of 110 basis points (“bps”), as compared to the same period in 2024. The increase was primarily driven by favorable price and mix shift of 150 bps partially offset by lower margins on sales volumes of 30 bps, and higher manufacturing costs of 10 bps.
Previous wording
The chart below presents the drivers of the gross profit variance from thesix months ended June 29, 2024 to thesix months ended June 28, 2025.
Current wording
The chart below presents the drivers of the gross profit variance from thenine months ended September 28, 2024 to thenine months ended September 27, 2025.
Previous wording
Gross profit for six months ended June 28, 2025 was $1,080 million, an increase of $233 million, or 27.5%, as compared to the same period in 2024, as shown in the above waterfall.
Current wording
Gross profit for the nine months ended September 27, 2025 was $1,636 million, an increase of $265 million, or 19.3%, as compared to the same period in 2024, as shown in the above waterfall.
Previous wording
Gross margin rate for the six months ended June 28, 2025 was 29.1%, an increase of 150 bps as compared to the same period in 2024. The increase was primarily driven by favorable impacts from the acquisition of Snap One of 110 bps and favorable price and mix shift of 70 bps. The increase was partially offset by lower volumes of 30 bps.
Current wording
Gross margin rate for the nine months ended September 27, 2025 was 29.3%, an increase of 130 bps as compared to the same period in 2024. The increase was primarily driven by favorable price and mix shift of 100 bps, and favorable impacts from the acquisition of Snap One of 70 bps. The increase was partially offset by lower margins on sales volumes of 30 bps.
Previous wording
Research and development expenses for the three months ended June 28, 2025 were $41 million, an increase of $20 million or 95.2% as compared to the same period in 2024. The increase was driven by $11 million in the Product and Solutions segment related to incremental headcount and third party services to develop and introduce new products into the market, and $9 million in the ADI Global Distribution segment related to the inclusion of Snap One.
Current wording
Research and development expenses for the three months ended September 27, 2025 were $44 million, an increase of $21 million or 91.3% as compared to the same period in 2024. The increase was primarily driven by investments in both segments related to incremental headcount and third party services to develop and introduce new products into the market.
Previous wording
Research and development expenses for the six months ended June 28, 2025 were $76 million, an increase of $30 million, or 65.2%, as compared to the same period in 2024. The increase was driven by $17 million in the ADI Global Distribution segment primarily related to the inclusion of Snap One, and $13 million in the Product and Solutions segment related to incremental headcount and third party services to develop and introduce new products into the market.
Current wording
Research and development expenses for the nine months ended September 27, 2025 were $120 million, an increase of $51 million, or 73.9%, as compared to the same period in 2024. The increase was primarily driven by investments in both segments related to incremental headcount and third party services to develop and introduce new products into the market.
Previous wording
Selling, general and administrative expenses for the six months ended June 28, 2025 were $625 million, an increase of $114 million, or 22.3%, as compared to the same period in 2024. The increase was primarily driven by $82 million from the inclusion of Snap One, net of prior year acquisition and integration costs, and $34 million of incremental operating costs including payroll and benefits, rent, marketing, IT, third party spend, and travel expense.
Current wording
Selling, general and administrative expenses for the nine months ended September 27, 2025 were $949 million, an increase of $121 million, or 14.6%, as compared to the same period in 2024. The increase was primarily driven by $82 million of higher costs versus prior year associated with the acquisition and integration of Snap One, $33 million of incremental operating costs including payroll and benefits, rent, marketing, IT, third party spend, and travel expense, and $4 million related to expenses incurred in connection with the announced future ADI Spin-Off.
Previous wording
Intangible asset amortization for the three months ended June 28, 2025 was $30 million, an increase of $17 million, or 130.8% as compared with the same period in 2024. The increase was primarily due to additional amortization expense of $16 million associated with the new intangibles from the Snap One acquisition.
Current wording
Intangible asset amortization for the three months ended September 27, 2025 was $31 million, an increase of $2 million, or 6.9% as compared with the same period in 2024 primarily due to foreign currency impacts.
Previous wording
Intangible asset amortization for the six months ended June 28, 2025 was $60 million, an increase of $38 million, or 172.7% as compared with the same period in 2024. The increase was primarily due to additional amortization expense of $36 million associated with the new intangibles from the Snap One acquisition.
Current wording
Intangible asset amortization for the nine months ended September 27, 2025 was $91 million, an increase of $40 million, or 78.4% as compared with the same period in 2024. The increase was primarily due to additional amortization expense of $36 million associated with the new intangibles from the Snap One acquisition as well as foreign currency impacts.
Previous wording
Restructuring, impairment and extinguishment costs for the three months ended June 28, 2025 were $2 million, a decrease of $9 million, or 81.8%, as compared to the same period in 2024. The decrease was primarily due to $6 million of debt extinguishment costs as part of the Snap One acquisition, and $5 million of impairment expense related to an equity security incurred in the prior year. The decrease was partially offset by $2 million of restructuring expenses incurred during the three months ended June 28, 2025. Restructuring expenses primarily relate to employee termination costs.
Current wording
Restructuring, impairment and extinguishment costs for the three months ended September 27, 2025 were $3 million, a decrease of $26 million, or 89.7%, as compared to the same period in 2024. The decrease was primarily due to $28 million of restructuring costs incurred in the prior year for various restructuring actions, including capturing synergies from the Snap One acquisition, and pertains to employee termination costs. The decrease was partially offset by $3 million of debt extinguishment and modification costs incurred during the three months ended September 27, 2025.
Previous wording
Indemnification Agreement expense for the six months ended June 28, 2025 was $972 million, up $882 million from the $90 million recorded in the same period of 2024. The increase was driven by the recognition of additional expense in connection with our agreement to terminate the Indemnification Agreement with Honeywell. This expense reflects the revised estimate of our liability under the agreement of $1,625 million.
Current wording
Indemnification Agreement expense for the nine months ended September 27, 2025 was $972 million, an increase of $837 million from the $135 million recorded in the same period of 2024. The increase was driven by the additional expense incurred in connection with the termination of the Indemnification Agreement with Honeywell.
Previous wording
Interest expense, net for the three months ended June 28, 2025 was $24 million, an increase of $9 million, or 60.0%, as compared to the same period in 2024. The increase was due to an increase in our long-term debt resulting in $4 million of higher interest expense and a decrease of $4 million in interest rate derivative related receipts due to interest rate fluctuations and a lower aggregate notional due to swap maturities.
Current wording
Interest expense, net for the three months ended September 27, 2025 was $37 million, an increase of $10 million, or 37.0%, as compared to the same period in 2024. The increase was due to additional long-term debt resulting in $7 million of higher interest expense, and a decrease of $4 million in interest rate derivative related receipts due to interest rate fluctuations and a lower aggregate notional amount of interest rate swaps due to maturities.
Previous wording
Interest expense, net for the six months ended June 28, 2025 was $49 million, an increase of $21 million, or 75.0%, as compared to the same period in 2024. The increase was due to an increase in our long-term debt resulting in $9 million of higher interest expense, a decrease of $8 million in interest rate derivative related receipts due to interest rate fluctuations and a lower aggregate notional due to swap maturities, and lower interest income of $3 million as a result of lower interest rates and lower cash balances.
Current wording
Interest expense, net for the nine months ended September 27, 2025 was $86 million, an increase of $31 million, or 56.4%, as compared to the same period in 2024. The increase was due to additional long-term debt resulting in $15 million of higher interest expense, a decrease of $12 million in interest rate derivative related receipts due to interest rate fluctuations and a lower aggregate notional amount of interest rate swaps due to maturities, and lower interest income of $3 million as a result of lower interest rates and lower cash balances.
Previous wording
Income tax expense for the three months ended June 28, 2025 was $87 million, an increase of $58 million as compared to the same period in 2024. The increase was primarily driven by a decrease in income before taxes, and an increase in the nondeductible Indemnification Agreement expense. The effective income tax rate decreased from 49.2% to (11.8)%, primarily driven by the mix of earnings across the jurisdictions in which we operate, decreased income before taxes with relatively fixed non-deductible expenses and a large increase in the non-deductible Indemnification Agreement expense, and U.S. taxation of foreign earnings.
Current wording
The income tax benefit for the three months ended September 27, 2025 was $46 million compared to the income tax expense of $24 million in the same period in 2024. The decrease was primarily driven by an increase in income before taxes for the quarter and a change in projected income before taxes for the year. The effective income tax rate decreased from 54.5% to (41.8)%, primarily driven by the mix of earnings across the jurisdictions in which we operate, decreased income before taxes with relatively fixed non-deductible expenses and a large increase in the non-deductible Indemnification Agreement expense and U.S. taxation of foreign earnings.
Previous wording
Income tax expense for the six months ended June 29, 2024 was $96 million, an increase of $37 million as compared to the same period in 2024. The increase was primarily driven by a decrease in income before taxes and an increase in the non-deductible Indemnification Agreement expense. The effective income tax rate decreased from 44.7% to (13.3)%, primarily driven by the mix of earnings across the jurisdictions in which we operate, decreased income before taxes with relatively fixed non-deductible expenses and a large increase in the non-deductible Indemnification Agreement expense, and U.S. taxation of foreign earnings.
Current wording
Income tax expense for the nine months ended September 27, 2025 was $50 million, a decrease of $33 million as compared to the same period in 2024. The decrease was primarily driven by a decrease in income before taxes and an increase in the non-deductible Indemnification Agreement expense. The effective income tax rate decreased from 47.2% to (8.2)%, primarily driven by the mix of earnings across the jurisdictions in which we operate, decreased income before taxes with relatively fixed non-deductible expenses and a large increase in the non-deductible Indemnification Agreement expense and U.S. taxation of foreign earnings.
Previous wording
Products and Solutions net revenue for the three months ended June 28, 2025 was $666 million, an increase of $36 million, or 5.7%, as compared to the same period in 2024. The increase is primarily due to a $53 million favorable impact from price and mix, and $4 million from favorable foreign exchange rates. The increase was partially offset by $22 million from lower volumes.
Current wording
Products and Solutions net revenue for the three months ended September 27, 2025 was $661 million, an increase of $16 million, or 2.5%, as compared to the same period in 2024. The increase is primarily due to a $21 million favorable impact from price and mix, and $6 million from favorable foreign currency exchange rates. The increase was partially offset by $10 million from lower sales volumes.
Previous wording
Products and Solutions income from operations for the three months ended June 28, 2025 was $142 million, an increase of $12 million, or 9.2%, as compared to the same period in 2024. The increase is primarily due to favorable price and mix shift of $33 million, and lower material, freight, and other manufacturing costs of $4 million. The increase was partially offset by lower volumes of $12 million, and $11 million of incremental research and development expenses related to additional headcount and third party services to develop and introduce new products into the market.
Current wording
Products and Solutions income from operations for the three months ended September 27, 2025 was $140 million, an increase of $12 million, or 9.4%, as compared to the same period in 2024. The increase is primarily due to favorable price and mix shift of $13 million, lower restructuring costs of $8 million, lower bad debt expense of $7 million, and lower material, freight, and other manufacturing costs of $3 million. The increase was partially offset by lower sales volumes of $9 million, and $11 million of incremental research and development expenses related to additional headcount and third party services to develop and introduce new products into the market.
Previous wording
Products and Solutions net revenue for the six months ended June 28, 2025 was $1,315 million, an increase of $65 million, or 5.2%, as compared to the same period in 2024. The increase is primarily due to a $74 million favorable impact from price and mix. The increase was partially offset by $6 million from lower volumes, and $3 million from unfavorable foreign exchange rates.
Current wording
Products and Solutions net revenue for the nine months ended September 27, 2025 was $1,976 million, an increase of $81 million, or 4.3%, as compared to the same period in 2024. The increase is primarily due to a $95 million favorable impact from price and mix, and $3 million from favorable foreign currency exchange rates. The increase was partially offset by $16 million from lower sales volumes.
Previous wording
Products and Solutions income from operations for the six months ended June 28, 2025 was $278 million, an increase of $36 million, or 14.9%, as compared to the same period in 2024. The increase is primarily due to favorable price and mix shift of $42 million, and lower material, freight, and other manufacturing costs of $7 million. The increase was partially offset by $13 million of incremental research and development expenses related to planned investments that we believe will drive future growth.
Current wording
Products and Solutions income from operations for the nine months ended September 27, 2025 was $418 million, an increase of $48 million, or 13.0%, as compared to the same period in 2024. The increase is primarily due to a favorable price and mix shift of $55 million, lower restructuring costs of $12 million, lower bad debt expense of $6 million, and lower material, freight, and other manufacturing costs of $10 million. The increase was partially offset by $23 million of incremental research and development expenses related to additional headcount and third party services to develop and introduce new products into the market, and $10 million from lower sales volumes.
Previous wording
ADI Global Distribution net revenue for the three months ended June 28, 2025, was $1,277 million, an increase of $318 million, or 33.2%, as compared to the same period in 2024. The increase was primarily driven by $218 million of revenue from the acquisition of Snap One, $85 million from higher volumes, $11 million from favorable price and mix shift, and $7 million from favorable foreign exchange rates.
Current wording
ADI Global Distribution net revenue for the three months ended September 27, 2025, was $1,203 million, an increase of $20 million, or 1.7%, as compared to the same period in 2024. The increase was primarily driven by $30 million from favorable price and mix shift, and $7 million from favorable foreign currency exchange rates. The increase was partially offset by $18 million from lower sales volumes due primarily to impacts from our ERP implementation.
Previous wording
ADI Global Distribution net revenue for the six months ended June 28, 2025 was $2,398 million, an increase of $573 million, or 31.4%, as compared to the same period in 2024. The increase was primarily driven by $446 million of revenue from the acquisition of Snap One, $120 million from higher volumes, and $9 million from net favorable price and mix shift.
Current wording
ADI Global Distribution net revenue for the nine months ended September 27, 2025 was $3,601 million, an increase of $593 million, or 19.7%, as compared to the same period in 2024. The increase was primarily driven by $446 million of revenue from the acquisition of Snap One, $102 million from higher sales volumes, $39 million from favorable price and mix shift, and $9 million from favorable foreign currency exchange rates.
Previous wording
Corporate costs for the six months ended June 28, 2025 were $70 million, a decrease of $33 million, or 32.0%, as compared to the same period in 2024. The decrease was driven by $29 million of acquisition and integration costs, $6 million of debt extinguishment costs as part of the Snap One acquisition, and $5 million of impairment expense related to an equity security incurred in the prior year. The decrease was partially offset by incremental operating costs of $8 million including payroll and benefits and third party spend.
Current wording
Corporate costs for the nine months ended September 27, 2025 were $112 million, a decrease of $29 million, or 20.6%, as compared to the same period in 2024. The decrease was primarily driven by $29 million of acquisition and integration costs incurred in the prior year, and lower restructuring, impairment and extinguishment costs of $11 million. The decrease was partially offset by incremental operating costs of $8 million including payroll and benefits and third party spend, and $4 million of expenses related to the announced future ADI Spin-Off.
Previous wording
As of June 28, 2025, total cash and cash equivalents were $753 million, of which 26% were held by foreign subsidiaries. Our liquidity is primarily dependent on our ability to continue to generate positive cash flows from operations, supplemented by external sources of capital, as needed. Additional liquidity may also be provided through access to the capital markets and our A&R Revolving Credit Facility in an aggregate principal amount of $500 million.
Current wording
As of September 27, 2025, total cash and cash equivalents were $345 million, of which 50% were held by foreign subsidiaries. Our liquidity is primarily dependent on our ability to continue to generate positive cash flows from operations, supplemented by external sources of capital, as needed. Additional liquidity may also be provided through access to the capital markets and our A&R Revolving Credit Facility in an aggregate principal amount of $500 million.
Previous wording
Our future capital requirements will depend on many factors, including the rate of sales growth, market acceptance of our products, the timing and extent of research and development projects, potential acquisitions of companies or technologies, and the expansion of our sales and marketing activities. We may enter into acquisitions or strategic arrangements in the future, which also could require us to seek additional equity or debt financing. While we may elect to seek additional funding at any time, we believe our existing cash, cash equivalents, and availability under our credit facilities are sufficient to meet our capital requirements through at least the next 12 months and the longer term.
Current wording
Our future capital requirements will depend on many factors, including acquisition or strategic transactions we may enter into such as the announced future ADI Spin-Off, the rate of sales growth, market acceptance of our products, the timing and extent of research and development projects, potential acquisitions of companies or technologies, and the expansion of our sales and marketing activities. While we may elect to seek additional funding at any time, we believe our existing cash, cash equivalents, and availability under our credit facilities are sufficient to meet our capital requirements for the foreseeable future.
Previous wording
The Senior Notes due 2029 and Senior Notes due 2032 are senior unsecured obligations of Resideo guaranteed by Resideo’s existing and future domestic subsidiaries and rank equally with all of Resideo’s senior unsecured debt and senior to all of Resideo’s subordinated debt.
Current wording
As of September 27, 2025, we had $3,237 million of long-term debt, including $2,337 million outstanding under our A&R Credit Agreement, $300 million 4.000% Senior Notes due 2029, and $600 million 6.500% Senior Notes due 2032. We have $20 million in outstanding debt due in the next twelve months, and $48 million of unamortized deferred financing costs. The Senior Notes due 2029 and Senior Notes due 2032 are senior unsecured obligations of Resideo guaranteed by Resideo’s existing and future domestic subsidiaries and rank equally with all of Resideo’s senior unsecured debt and senior to all of Resideo’s subordinated debt.
Previous wording
As of June 28, 2025, we had $2,013 million of long-term debt outstanding under our A&R Credit Agreement, Senior Notes due 2029, and Senior Notes due 2032, with $8 million due in the next twelve months. We have also entered into certain interest rate swap agreements based on Term SOFR. These interest rate swap agreements effectively convert a portion of our variable-rate debt to fixed rate debt. Additionally, we assumed an interest rate cap in 2024 which effectively caps the interest on a portion of our variable rate debt with a notional amount of $344 million and a strike rate of 4.79%.
Current wording
We have also entered into certain interest rate swap agreements based on Term SOFR. These interest rate swap agreements effectively convert a portion of our variable-rate debt to fixed rate debt. Additionally, we assumed an interest rate cap in 2024 which effectively caps the interest on a portion of our variable rate debt with a current notional amount of $343 million and a strike rate of 4.79%.
Previous wording
As of June 28, 2025, we were in compliance with all covenants related to the A&R Credit Agreement, Senior Notes due 2029, and Senior Notes due 2032. We may be subject to new or additional debt covenants in connection with the Debt Commitment Letter.
Current wording
As of September 27, 2025, we were in compliance with all covenants related to the A&R Credit Agreement, Senior Notes due 2029, and Senior Notes due 2032.
Previous wording
Refer to Note 12. Long-Term Debt and Note 13. Derivative Financial Instruments for a description of our debt obligations and the timing of future principal and interest payments, including impacts from our interest rate derivatives.
Current wording
Refer to Note 12. Long-Term Debt and Note 13. Derivative Financial Instruments to the Unaudited Consolidated Financial Statements for a description of our debt obligations and the timing of future principal and interest payments, including impacts from our interest rate derivatives.
Previous wording
In August 2023, we announced that our Board of Directors authorized a share repurchase program for the repurchase of up to $150 million of our common stock over an unlimited time period. During the three and six months ended June 28, 2025, there were no common share repurchases. As of June 28, 2025, we had $108 million of authorized repurchases remaining under the Share Repurchase Program.
Current wording
In August 2023, we announced that our Board of Directors authorized a share repurchase program for the repurchase of up to $150 million of our common stock over an unlimited time period. During the three and nine months ended September 27, 2025, there were no common share repurchases. As of September 27, 2025, we had $108 million of authorized repurchases remaining under the Share Repurchase Program.
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