RESIDEO TECHNOLOGIES, INC.
For the period ended Dec 31, 2025. Filed Feb 24, 2026.
View on SEC.govAbout this filing
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 24, 2026
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-K
Period ended 2024-12-31; filed 2025-02-20.
0001740332-25-000010
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-24.
0001740332-26-000005
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 147 previous paragraphs and 143 current paragraphs.
69 unchanged; 39 reworded; 35 added; 38 removed; 1 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 (35)
Current report
Our ADI Global Distribution segment is a leading, global specialty distributor of professionally installed low-voltage products, including security and AV solutions, serving commercial and residential markets through an omnichannel go-to-market platform. ADI Global Distribution sells primarily to licensed professional installers, dealers, and integrators. We offer an expansive list of products from leading suppliers across key specialty low-voltage categories. ADI complements our third-party supplier products with a suite of exclusive brands and services offerings.
Current report
For 2026, 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 USMCA or specific commodity exceptions. Tariff impacts related to imported products that are not subject to the USMCA or another exception may be impacted by the new tariff surcharge of at least 10%. We will continue to take actions to address 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 closely and will adjust our business operations as appropriate. Also, we anticipate slow growth in the U.S. residential housing market and a moderation of growth in the non-residential construction market. Based on the aforementioned, our 2026 revenue outlook is growth in the mid-single-digits range year-over-year.
Current report
(1) In connection with the Honeywell Spin-Off, we entered into an indemnification and reimbursement agreement, pursuant to which we had an obligation to make cash payments associated with Honeywell’s environmental liabilities (the “Indemnification Agreement”) which was terminated in August 2025.
Current report
Net revenue for the year ended December 31, 2025 was $7,472 million, an increase of $711 million, or 10.5%, compared to the same period in 2024. The increase was primarily due to $446 million of revenue from the acquisition of Snap One, $193 million from favorable price and mix, $47 million from higher sales volume, and $32 million from favorable foreign currency exchange rates.
Current report
Gross profit for the year ended December 31, 2025 was $2,196 million, an increase of $295 million, or 15.5%, compared to the same period in 2024, as shown in the above waterfall.
Current report
Research and development expenses for the year ended December 31, 2025 were $167 million, an increase of $56 million, or 51% compared to the same period in 2024. The increase was primarily driven by $34 million from Products and Solutions related to incremental headcount and third-party services to develop and introduce new products into the market, and $22 million from ADI Global Distribution primarily as a result of the acquisition of Snap One.
Current report
Selling, general and administrative expenses for the year ended December 31, 2025, were $1,266 million, an increase of $128 million, or 11.2%, compared to the same period in 2024. The increase was driven by $78 million of higher operating costs versus prior year associated with the acquisition and integration of Snap One, $44 million of incremental operating costs including payroll and benefits, rent, and third-party spend, and $6 million of unfavorable foreign currency impacts.
Current report
Restructuring, impairment and extinguishment costs for the year ended December 31, 2025 were $16 million, a decrease of $36 million, or 69% compared to the same period in 2024. The decrease was due to $26 million of lower restructuring costs in 2025 due to fewer restructuring actions, $6 million of lower impairment expenses associated with certain equity investments in the prior year, and $4 million of lower debt extinguishment and modification costs.
Current report
Business Separation Costs
Current report
Business separation costs for the year ended December 31, 2025 were $18 million. These expenditures are one‑time in nature and included third‑party advisory, consulting, legal, and other incremental separation‑related costs incurred in connection with the announced ADI Spin-Off.
Current report
Indemnification Agreement Expense
Current report
Indemnification Agreement expense for the year ended December 31, 2025 was $972 million, an increase of $761 million compared to the same period in 2024. The increase was driven by additional expense incurred in connection with the termination of the Indemnification Agreement with Honeywell.
Current report
Other expense (income), net
Current report
Other income, net for the year ended December 31, 2025 was $43 million, a change of $50 million compared to other expenses, net of $7 million in the same period in 2024. The change was primarily driven by a $52 million gain on sale recorded in 2025 in connection with the sale of the Resideo Grid Services business by the Products and Solutions segment, and $11 million from amortization of actuarial gains related to the non-U.S. pension plans, which was partially offset by $17 million of foreign currency impacts.
Current report
Interest expense, net for the year ended December 31, 2025 was $135 million, an increase of $54 million, or 67% compared to the same period in 2024. The increase was primarily due to an approximately $1.2 billion increase in outstanding debt resulting in $34 million of higher interest expense, a decrease of $14 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 $5 million as a result of lower interest rates and lower cash balances.
Current report
Income tax expense for the year ended December 31, 2025 was $70 million, a decrease of $35 million or 33% 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, offset by an increase in deductible interest expense.
Current report
The effective income tax rate decreased from 47.5% to (15.3)%, compared to the same period in 2024, primarily driven by the mix of earnings across the jurisdictions in which we operate, decreased income before taxes with relatively fixed non-deductible expenses, a large increase in the non-deductible Indemnification Agreement expense offset by an increase in deductible interest expense and U.S. taxation of foreign earnings.
Current report
Products and Solutions net revenue for the year ended December 31, 2025 was $2,688 million, an increase of $124 million, or 4.8%, compared to the same period in 2024. The increase is primarily due to an $129 million favorable impact from price and mix, and $14 million from favorable foreign currency exchange rates. The increase was partially offset by $19 million from lower sales volumes.
Current report
Income from operations for the year ended December 31, 2025 was $555 million, an increase of $52 million, or 10.3%, compared to the same period in 2024. The increase is primarily due to favorable price and mix shift of $72 million, $11 million reduction in engineering costs within cost of goods sold, lower restructuring costs of $9 million, and lower manufacturing costs of $4 million. The increase was partially offset by $34 million of incremental research and development expenses, reflecting a strategic reallocation of engineering resources to support new product development, and lower sales volumes of $13 million.
Current report
Income from operations for the year ended December 31, 2025 was $212 million, an increase of $17 million, or 8.7%, compared to the same period in 2024. The increase was primarily driven by $162 million in additional gross profit from the acquisition of Snap One, $61 million from net favorable price and mix shift, $11 million lower restructuring expense, and $10 million from higher sales volumes. This increase was partially offset by an increase in selling, general and administrative expenses of $146 million including payroll and benefits, rent, bad debt, and third-party spend. Additionally, amortization increased by $40 million primarily due to intangibles acquired as part of the Snap One acquisition, research and development costs increased by $22 million, freight and duties increased by $10 million primarily due to the one-time impacts from our system implementation, and we had $10 million in unfavorable impacts due to foreign currency exchange rates and other miscellaneous items.
Current report
Corporate costs for the year ended December 31, 2025 were $160 million, a decrease of $18 million, or 10.1% compared to the same period in 2024. The decrease was primarily driven by $33 million of Snap One acquisition and integration costs incurred in the prior year, and lower restructuring, impairment and extinguishment costs of $16 million. The decrease was partially offset by $18 million of business separation costs related to the announced ADI Spin-Off and incremental operating costs of $11 million including payroll and benefits and third-party spend.
Current report
Liquidity and Capital Resources
Current report
In August 2025, we made a pre-tax, one-time cash payment of $1,590 million to Honeywell to terminate the Indemnification Agreement. This was partially financed in the amount of $1,225 million in incremental term loans under our credit agreement with JPMorgan Chase Bank N.A. as administrative agent (the “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 11. Long-Term Debt and Note 15. Commitments and Contingencies of the Notes to 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 of incremental terms loans which mature in August 2032, the net proceeds of which were used primarily to fund the termination of the Indemnification Agreement. As a result of the August 2025 amendment, the A&R Term B Facility bears interest at a rate per annum based on Term SOFR plus an interest rate margin of 2.00% per annum.
Current report
Common Share Repurchase Program
Current report
Net cash used for operating activities for the year ended December 31, 2025 was $1,137 million, a decrease in cash from operating activities of $1,581 million. This change was primarily driven by a net loss of $527 million in 2025 compared to net income of $116 million in the prior year, a $583 million use of cash in 2025 versus a $71 million source of cash in the prior year associated with long-term obligations payable under the Indemnification Agreement. The decrease was also driven by an $111 million greater use of cash in accrued liabilities associated primarily with a reduction in short-term obligations payable under the Indemnification Agreement and $97 million lower cash provided by accounts payable.
Current report
Net cash provided by financing activities for the year ended December 31, 2025 was $1,128 million, an increase of $97 million, or 9.4% as compared to 2024. This increase was primarily driven by a $596 million reduction in long term debt repayments offset by prior year proceeds of $482 million related to the issuance of Preferred Stock and an increase in Preferred Stock dividend payments of $23 million in 2025.
Current report
Indemnification Agreement Payments
Current report
In connection with the Honeywell Spin-Off, we entered into the Indemnification Agreement with Honeywell. On July 30, 2025, we entered into the Termination Agreement with Honeywell to terminate the Indemnification Agreement. 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 in August 2025 using proceeds from the incremental term loans issued under the A&R Credit Agreement, together with a portion of our cash on hand. We are no longer required to make any further payments to Honeywell under the Indemnification Agreement and the associated affirmative and negative covenants no longer apply. During the twelve months ended December 31, 2025, we paid Honeywell $1,695 million under the Indemnification Agreement, which includes the impact of the Termination Agreement. For further discussion on the Indemnification Agreement refer to Note 15. Commitments and Contingencies of the Notes to Consolidated Financial Statements.
Current report
Goodwill and Intangible Assets
Current report
Refer to Note 15. Commitments and Contingencies of the Notes to Consolidated Financial Statements for further discussion.
Current report
•our ability to spin-off the ADI Global Distribution business, including the timeframe and process for the same and unexpected consequences of the spin-off, including loss of customers;
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;
Removed paragraphs (38)
Previous report
Our ADI Global Distribution segment is a leading wholesale distributor of low-voltage products including security, fire, and access control, and participates significantly in the broader related markets of smart home, residential audio-visual, professional audio-visual, power management, networking, data communications, wire and cable, enterprise connectivity, and structured wiring products. In addition, ADI Global Distribution partners with a network of contract manufacturers and joint-development suppliers to produce a full range of proprietary smart-home technology products and solutions under our own exclusive brands. These products may be found in residential and commercial settings and utilize proprietary software platforms such as Control4 and OvrC for project commissioning and remote monitoring.
Previous report
•Cash Flow From Operations was $444 million in 2024 as compared to $440 million in 2023
Previous report
For 2025, we anticipate executing our business against a global macro-economic environment that continues to be mixed. Despite some signals that new U.S. residential home building is back to normal levels and the outlook for U.S. repair and remodeling has reverted to modest low-single digit percentage growth, U.S. mortgage rates remain high, the existing U.S. home re-sale market is still soft, and inflation remains persistent globally. We expect these trends to support our 2025 year-over-year revenue outlook of up low-to-mid single-digits.
Previous report
Net revenue for the year ended December 31, 2024 was $6,761 million, an increase of $519 million, or 8.3%, from the prior year, primarily due to $553 million of revenue from the acquisition of Snap One and higher sales volume of $74 million driven by the ADI Global Distribution segment. The increase was partially offset by $105 million of lower sales from the divestiture of the Genesis business in 2023, and $6 million of unfavorable foreign currency fluctuations. The price increases at Product and Solutions were offset by the decreases at ADI Global Distribution, resulting in minimal impact from price on net revenue.
Previous report
(1) Includes only the Snap One acquisition and Genesis divestiture
Previous report
Research and development expenses for the year ended December 31, 2024, were $111 million, an increase of $2 million as compared to the same period in 2023. The increase was primarily driven by $17 million from the acquisition of Snap One, which was partially offset by $15 million from lower third-party spend and personnel costs. Key drivers of the lower spend relate to optimization efforts and a realignment of IT resources towards maintenance projects within the Products and Solutions segment.
Previous report
Selling, general and administrative expenses for the year ended December 31, 2024, were $1,138 million, an increase of $178 million, or 18.5%, as compared to the same period in 2023. The increase was driven by $141 million of incremental operating expenses from the Snap One acquisition, and $45 million of acquisition and integration costs. The increase was partially offset by lower expenses of $8 million from the divestiture of the Genesis business in 2023.
Previous report
Restructuring, impairment and extinguishment costs increased $10 million for the year ended December 31, 2024, as compared to the same period in 2023. The increase was primarily due to debt extinguishments and related costs associated with multiple credit agreement amendments throughout the year.
Previous report
Other Expenses, Net
Previous report
Other expenses, net increased $49 million for the year ended December 31, 2024, as compared to the same period in 2023. The increase was driven by $33 million of additional expense related to the Reimbursement Agreement as noted in Note 15. Commitments and Contingencies, and a net gain on sale of assets and divestiture of $22 million, which was partially offset by $6 million of other costs including pension and foreign currency impacts.
Previous report
Interest expense, net increased $16 million for the year ended December 31, 2024 as compared to the same period in 2023, primarily due to an increase in our long-term debt resulting in $22 million of higher interest expense which was partially offset by $6 million of higher interest income as a result of effectively investing excess cash.
Previous report
Income tax expense of $105 million for the year ended December 31, 2024, includes $1 million of discrete tax benefit. The effective tax rate for the year ended December 31, 2024, excluding discrete tax benefits of $1 million, was 47.8% versus 37.9% for the same period in 2023, which excluded a discrete tax benefit of $16 million.
Previous report
Income tax expense increased for the year ended December 31, 2024, primarily due to an increase in non-deductible expenses. The increase in the overall effective tax rate was primarily driven by non-deductible indemnification costs, other non-deductible expenses, and U.S. taxation of foreign earnings.
Previous report
Products and Solutions revenue decreased $108 million, or 4.0%, as compared to the same period in 2023, due to $105 million from the divestiture of the Genesis business, lower sales volume of $24 million and unfavorable foreign currency fluctuations of $10 million. The decrease was partially offset by price increases of $31 million.
Previous report
Income from operations increased $57 million, or 12.8%, from the same period in 2023, primarily due to lower material, freight and other manufacturing costs of $101 million, lower restructuring expenses of $13 million, lower selling, general and administrative expenses of $5 million, and lower research and development expenses of $1 million. Partially offsetting the favorable impacts to income from operations were net unfavorable price and mix shift of $30 million, lower volumes of $20 million, and the impact from the divestiture of the Genesis business of $13 million.
Previous report
Income from operations decreased $43 million, or 18.1%, as compared to the same period in 2023, primarily due to an unfavorable sales mix and deflationary impact of $31 million, higher operational costs including freight and other costs of $27 million, Snap One acquisition and integration costs of $12 million, and higher restructuring expenses of $7 million.
Previous report
The decrease was partially offset by higher volumes of $18 million, and lower employee expenses of $13 million from prior restructuring efforts.
Previous report
Corporate costs for the year ended December 31, 2024, were $178 million, an increase of $41 million, or 29.9%, from $137 million in the same period of 2023. The increase was primarily due to $33 million of Snap One acquisition and integration costs, and $9 million ofextinguishments and costs associated with the credit agreement amendments.
Previous report
Capital Resources and Liquidity
Previous report
Credit Agreement
Previous report
In February 2021, we entered into an Amendment and Restatement Agreement with JP Morgan Chase Bank N.A. as administrative agent (the “A&R Credit Agreement”). In March 2022, we amended the A&R Credit Agreement adding $200 million in additional term loans. In June 2023, we amended the A&R Credit Agreement to replace the interest rate reference rate of LIBOR with the secured overnight financing rate (“SOFR”). Included in the A&R Term B Facility is a five-year senior secured revolving credit facility in an aggregate capacity of $500 million (the A&R Revolving Credit Facility and, together with the A&R Term B Facility, the “A&R Senior Credit Facilities”).
Previous report
In May 2024, the A&R Term B Facility was amended to (i) reduce the interest rate margin from 2.25% to 2.00%, (ii) eliminate the SOFR credit spread adjustment, and (iii) reduce the SOFR floor from 0.50% to 0%.
Previous report
In June 2024, we completed the acquisition of Snap One which was partially financed with $600 million in incremental term loans under our A&R Term B Facility, with a maturity date of May 14, 2031. We also extended the term of our A&R Revolving Credit Facility to June 2029.
Previous report
In July 2024, we issued $600 million in aggregate principal of 6.500% Senior Notes due 2032. The net proceeds of the Senior Notes due 2032 were used to repay $596 million principal amount outstanding indebtedness due February 2028 under the Company’s A&R Term B Facility.
Previous report
In December 2024, the A&R Term B Facility was further amended to reduce the interest rate margin from 2.00% to 1.75%.
Previous report
Senior Notes
Previous report
In July 2024, we issued $600 million in aggregate principal of 6.500% Senior Notes due 2032 (the “Senior Notes due 2032”). The net proceeds from the Senior Notes due 2032 were used to repay $596 million principal amount of outstanding indebtedness due February 2028 under the Company’s A&R Term B Facility.
Previous report
Share Repurchase Program
Previous report
Net cash provided by operating activities for the year ended December 31, 2024 was $444 million, an increase of $4 million compared to the prior year. The increase was primarily driven by higher cash earnings partially offset by working capital investments.
Previous report
Net cash provided by financing activities for the year ended December 31, 2024 was $1,031 million, an increase of $1,095 million compared to the prior year, primarily due to proceeds of $1,176 million and $482 million from the issuance of long-term debt and preferred stock, respectively, to support the Snap One acquisition. This increase was partially offset by an increase in debt repayments of $593 million as well as a decrease in common stock repurchases of $40 million.
Previous report
Reimbursement Agreement Payments
Previous report
In connection with the Spin-Off, we entered into the Reimbursement Agreement with Honeywell. As of December 31, 2024, a liability of $723 million was deemed probable and reasonably estimable; however, it is possible we could pay $140 million per year (exclusive of any late payment fees up to 5% per annum) until the earlier of: (1) December 31, 2043; or (2) December 31, of the third consecutive year during which the annual reimbursement obligation (including in respect of deferred payment amounts) has been less than $25 million. During the year ended December 31, 2024, we paid Honeywell $140 million under this agreement. For further discussion on the Reimbursement Agreement refer to Note 15. Commitments and Contingencies to Consolidated Financial Statements.
Previous report
Goodwill
Previous report
Warranties and Guarantees
Previous report
Expected warranty costs for products sold are recognized based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, length of the warranty, and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including labor to remove and replace the recalled part, are accrued as part of the warranty accrual at the time an obligation becomes probable and can be reasonably estimated. We periodically adjust these provisions to reflect actual experience and other facts and circumstances that impact the status of existing claims. Refer to Note 15. Commitments and Contingencies for additional information.
Previous report
Reimbursement Agreement
Previous report
In connection with the Spin-Off, we entered into the Reimbursement Agreement, pursuant to which we have an obligation to make cash payments to Honeywell in amounts equal to 90% of payments, which include amounts billed, with respect to certain environmental claims, remediation and, to the extent arising after the Spin-Off, hazardous exposure or toxic tort claims, in each case, including consequential damages (the liabilities) in respect to specified Honeywell properties contaminated through historical business operations prior to the Spin-Off (Honeywell Sites), including the legal and other costs of defending and resolving such liabilities, less 90% of Honeywell’s net insurance receipts relating to such liabilities, and less 90% of the net proceeds received by Honeywell in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales. The amount payable in respect of such liabilities arising in any given year is subject to a cap of $140 million. Reimbursement Agreement expenses are presented within other expense, net in the Consolidated Statements of Operations and within other accrued liabilities payable under Indemnification Agreements in the Consolidated Balance Sheets. Refer to Note 15. Commitments and Contingencies to Consolidated Financial Statements.
Previous report
Refer to Note 15. Commitments and Contingencies to Consolidated Financial Statements for further discussion.
Reworded paragraphs (39)
Previous wording
•Net revenue of $6.76 billion in 2024, up 8% from $6.24 billion in 2023
Current wording
•Net revenue of $7.47 billion in 2025, up 10.5% from $6.76 billion in 2024
Previous wording
•Gross profit margin of 28.1%, compared to 27.2% in the prior year comparable period
Current wording
•Gross profit margin of 29.4%, compared to 28.1% in the prior year comparable period
Previous wording
•Income from operations of$520 million, or 7.7% of revenue, compared to$547 million, or 8.8% of revenue in 2023
Current wording
•Income from operations of$607 million, or 8.1% of revenue, compared to$520 million, or 7.7% of revenue in 2024
Previous wording
•Fully diluted earnings per common share of $0.61, compared to $1.42 per common share in the same period last year
Current wording
•Fully diluted earnings (loss) per common share of $(3.77), compared to $0.61 per common share in the same period last year
Previous wording
We are a leading global manufacturer, developer, and distributor of technology-driven sensing and controls products and solutions that help homeowners and businesses stay connected and in control of their comfort, security, energy use, and smart living. We are a leader in key product markets including home heating, ventilation, and air conditioning controls, smoke and carbon monoxide detection home safety and fire suppression, and security. Our global footprint serves residential and commercial end-markets. Our solutions and services can be found in over 150 million residential and commercial spaces globally, with tens of millions of new devices sold annually.
Current wording
We are a global manufacturer, developer, and distributor of technology-driven sensing and controls products and solutions that help homeowners and businesses stay connected and in control of their comfort, security, energy use, and smart living. We are a leading player in key product markets including home heating, ventilation, and air conditioning controls; smoke and carbon monoxide detection home safety and fire suppression; and security. Our global footprint serves residential and commercial end-markets. Our solutions and services can be found in over 150 million residential and commercial spaces globally, with tens of millions of new devices sold annually.
Previous wording
We manage our business operations through two business segments, Products and Solutions and ADI Global Distribution. In the second quarter of 2024, we expanded the business through the acquisition of Snap One, which has been incorporated into the ADI Global Distribution business segment. The acquisition expands our distribution into and reach with smart-living products, services, and software.
Current wording
We manage our business operations through two business segments, Products and Solutions and ADI Global Distribution.
Previous wording
Our Products and Solutions segment offerings include temperature and humidity control, water and air solutions, smoke and carbon monoxide detection home safety products, residential and small business security products, video cameras, other home-related lifestyle convenience solutions, cloud infrastructure, installation and maintenance tools, and related software.
Current wording
Our Products and Solutions segment offerings include temperature and humidity control, water and air solutions, smoke and carbon monoxide detection home safety products, residential and small business security products, video cameras, other home-related lifestyle convenience solutions, cloud infrastructure, installation and maintenance tools, and related software. We also sell components to manufacturers of water heaters, heat pumps, and boilers. Our products and solutions for comfort, energy management, safety, and security benefit from trusted, well-established branded offerings such as Braukmann, BRK, First Alert, Honeywell Home, Resideo, and others.
Previous wording
Our financial performance is influenced by macroeconomic factors underlying end user demand such as repair and remodeling activity, residential and non-residential construction, new and existing home sales, employment rates, interest rates and bank lending standards, and supply chain dynamics that can be influenced by geopolitics. The ongoing uncertainty and volatility in the global macroeconomic environment have affected, and could continue to affect, our visibility toward future performance. While supply chain and logistics continued to normalize over 2024, uncertainties remain including the potential for changes in inflation and interest rates, tariffs, increased labor costs, reduced consumer spending due to softening labor markets, elevated mortgage rates, unfavorable foreign currency impacts from a stronger U.S. dollar, shifts in energy policies, and potential market and other disruption from the ongoing conflict between Russia and Ukraine as well as the Middle East crisis.
Current wording
Our financial performance is influenced by macroeconomic factors underlying end user demand such as repair and remodeling activity, residential and commercial construction, new and existing home sales, employment rates, interest rates and bank lending standards, and supply chain dynamics that can be influenced by geopolitics. The ongoing uncertainty and volatility in the global macroeconomic and political environments have affected, and could continue to affect, our visibility toward future performance. Uncertainties remain, including the global tariff environment, geopolitical relations between and among the U.S. and other countries, potential for changes in inflation and interest rates, increased labor costs, reduced consumer spending due to softening labor markets, elevated mortgage rates, shifts in energy policies, and potential market and other disruption from any of the above.
Previous wording
Refer to Note 1. Nature of Operations and Basis of Presentation to Consolidated Financial Statements.
Current wording
Refer to Note 1. Nature of Operations and Basis of Presentation of the Notes to Consolidated Financial Statements.
Previous wording
This section of the Form 10-K discusses fiscal 2024 and fiscal 2023 items and year-over-year comparisons of these periods. Discussions of fiscal 2022 items and year-over-year comparisons between fiscal 2023 and fiscal 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 in the Company’s 2023 Annual Report on Form 10-K filed February 14, 2024 as reclassified in our Current Report on Form 8-K filed on June 4, 2024 to reflect the impacts of certain corporate functions being decentralized to align with the business strategy. Refer to Note 4. Segment Financial Data for additional information.
Current wording
This section of the Form 10-K discusses fiscal 2025 and fiscal 2024 items and year-over-year comparisons of these periods. Discussions of fiscal 2023 items and year-over-year comparisons between fiscal 2024 and fiscal 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 in our 2024 Annual Report on Form 10-K filed February 20, 2025.
Previous wording
Gross profit of $1,901 million increased $205 million and gross margin of 28.1% was up 90 basis points (“bps”) from the prior year. The increase in gross margin was primarily driven by lower manufacturing costs of 140 bps, favorable impacts from the acquisition of Snap One, net of Genesis divestiture of 80 bps, which was partially offset by net unfavorable price and mix shift of 90 bps and the impact from lower volumes of 30 bps.
Current wording
Gross margin rate for the year ended December 31, 2025 was 29.4%, an increase of 130 basis points (“bps”) from the prior year. The increase was primarily driven by favorable price and mix shift of 100 bps, and favorable impacts from the acquisition of Snap One of 50 bps. The increase was partially offset by lower margins on sales volumes of 20 bps.
Previous wording
Intangible asset amortization increased $42 million for the year ended December 31, 2024, as compared to the same period in 2023. The increase was primarily due to additional amortization expense of $41 million associated with the new intangibles from the Snap One acquisition.
Current wording
Intangible asset amortization for the year ended December 31, 2025 was $122 million, an increase of $42 million, or 53% compared to the same period in 2024. The increase was primarily due to amortization expense of $36 million associated with the new intangible assets acquired in the Snap One acquisition, and $6 million higher amortization primarily related to an increase in capitalized software development.
Previous wording
ADI Global Distribution net revenue increased $627 million, or 17.6%, as compared to the same period in 2023, primarily due to $553 million of revenue from the acquisition of Snap One, $98 million from higher volumes, and favorable foreign currency fluctuations of $4 million. The increase was partially offset an unfavorable price impact of $31 million.
Current wording
ADI Global Distribution net revenue for the year ended December 31, 2025 was $4,784 million, an increase of $587 million, or 14.0%, compared to the same period in 2024. The increase was primarily driven by $446 million of revenue from the acquisition of Snap One, $66 million from higher sales volumes, $64 million from favorable price and mix shift, and $18 million from favorable foreign currency exchange rates.
Previous wording
As of December 31, 2024, total cash and cash equivalents were $692 million, of which 32% 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 senior secured revolving credit facility in an aggregate principal amount of $500 million (the “A&R Revolving Credit Facility”).
Current wording
As of December 31, 2025, total cash and cash equivalents were $661 million, of which 33% 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 senior secured revolving credit facility in an aggregate principal amount of $500 million (the “A&R Revolving Credit Facility”).
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
In August 2021, we issued $300 million in principal amount of 4.000% Senior Notes due in 2029 (“the Senior Notes due 2029”). The Senior Notes due 2029 are senior unsecured obligations of Resideo guaranteed by our existing and future domestic subsidiaries, rank equally with all of our senior unsecured debt, and are senior to all of our subordinated debt.
Current wording
As of December 31, 2025, we had $3,231 million of total debt, including $2,331 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 $18 million in outstanding debt due in the next twelve months and $46 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.
Previous wording
As of December 31, 2024, we had $2,015 million of long-term debt outstanding under our A&R Credit Agreement, Senior Notes due 2029, and Senior Notes due 2032, of which $6 million is due in the next 12 months. We have entered into certain interest rate swap agreements to effectively convert a portion of our variable-rate debt to fixed-rate debt. Additionally, as part of our acquisition of Snap One, we assumed an interest rate cap agreement 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 the term secured overnight financing rate (“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 capped the interest on a portion of our variable-rate debt with a notional amount of $342 million and a strike rate of 4.79% (the “Interest Rate Cap”). Pursuant to the terms of the Interest Rate Cap, we paid a premium of $7 million at the maturity date of December 31, 2025; therefore, the instrument was fully settled and is no longer outstanding.
Previous wording
Refer to Note 11. Long-Term Debt and Note 12. Derivative Financial Instrumentsto Consolidated Financial Statements for a description of our debt obligations and the timing of future principal and interest payments, including impacts from our Swap Agreements.
Current wording
Refer to Note 11. Long-Term Debt and Note 12. Derivative Financial Instruments of the Notes to 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 twelve months ended December 31, 2024 and 2023, we repurchased 0.1 million and 2.6 million shares of common stock in the open market at a total cost of $1 million and $41 million, respectively. As of December 31, 2024, we had approximately $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 twelve months ended December 31, 2025, there were no common stock repurchases. During the twelve months ended December 31, 2024, we repurchased approximately 75 thousand shares of common stock in the open market at a total cost of $1 million. As of December 31, 2025, we had approximately $108 million of authorized repurchases remaining under the share repurchase program.
Previous wording
Our cash flows from operating, investing, and financing activities for the years ended December 31, 2024 and 2023, as reflected in the audited Consolidated Financial Statements are summarized as follows:
Current wording
Our cash flows from operating, investing, and financing activities for the years ended December 31, 2025 and 2024, as reflected in the Consolidated Financial Statements are summarized as follows:
Previous wording
Net cash used for investing activities for the year ended December 31, 2024 was $1,409 million, an increase of $1,365 million, compared to the prior year, primarily driven by acquiring Snap One for $1,337 million and lower net proceeds from the sale of business, acquisitions and investments of $85 million. These amounts were partially offset by a decrease in capital expenditures of $25 million from 2023 to 2024.
Current wording
Net cash used for investing activities for the year ended December 31, 2025 was $39 million, a decrease of $1,370 million, or 97.2%, as compared to 2024. The decrease was primarily driven by the prior year acquisition of Snap One for $1,337 million and $77 million received in 2025 in connection with the sale of the Resideo Grid Services business, partially offset by an increase in capital expenditures of $36 million in 2025.
Previous wording
We have operating lease arrangements for the majority of our manufacturing sites, offices, engineering and lab sites, stocking locations, warehouses, automobiles, and certain equipment. As of December 31, 2024, we had operating lease payment obligations of $263 million, with $51 million payable within 12 months.
Current wording
We have operating lease arrangements for the majority of our manufacturing sites, offices, engineering, lab, and storage sites, stocking locations, warehouses, automobiles, and certain equipment. As of December 31, 2025, we had operating lease payment obligations of $346 million, with $57 million payable within 12 months.
Previous wording
We enter into purchase obligations with various vendors in the normal course of business. As of December 31, 2024, we had purchase obligations of $358 million, with $177 million payable within 12 months.
Current wording
We enter into purchase obligations with various vendors in the normal course of business. As of December 31, 2025, we had purchase obligations of $178 million, with $130 million payable within 12 months.
Previous wording
Our Consolidated Financial Statements are prepared in accordance with U.S. GAAP and pursuant to the regulations of the U.S. Securities and Exchange Commission (“SEC”) and is based in part on the application of significant accounting policies, many of which require us to make estimates and assumptions. Critical accounting policies and significant estimates are those judgments that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition and results of operations. We review our estimates and assumptions on an ongoing basis throughout the year and as new events or changes in our operating environment occur with our Audit Committee of the Board of Directors. We base our estimates and assumptions on extensive historical experience and/or other pertinent factors we believe are applicable and reasonable under the circumstances, such as forecasts of future performance, which serve as the foundation for determining how to recognize and measure assets and liabilities not readily apparent from other sources. We consider the below critical areas in the application of our accounting policies and estimates that involve a significant level of estimation uncertainty, complex judgment, subjectivity, and have had or are reasonably likely to have a material impact on our financial condition or results of operations and are critical to the understanding of our Consolidated Financial Statements. Actual results could differ from our estimates and assumptions. Refer to Note 2. Summary of Significant Accounting Policiesto Consolidated Financial Statements.
Current wording
Our Consolidated Financial Statements are prepared in accordance with U.S. GAAP and pursuant to SEC regulations and is based, in part, on the application of significant accounting policies, many of which require us to make estimates and assumptions. Application of the critical accounting estimates discussed below requires management’s significant judgments and involves a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition and results of operations. We review our estimates and assumptions on an ongoing basis and reflect changes as appropriate when additional information becomes available. We base our estimates and assumptions on extensive historical experience and/or other pertinent factors we believe are applicable and reasonable under the circumstances, such as forecasts of future performance, which serve as the foundation for determining how to recognize and measure assets and liabilities not readily apparent from other sources. We consider the below critical areas in the application of our accounting policies and estimates that involve a significant level of estimation uncertainty, complex judgment, subjectivity, and have had or are reasonably likely to have a material impact on our financial condition or results of operations and are critical to the understanding of our Consolidated Financial Statements. Actual results could differ from our estimates and assumptions. Refer to Note 2. Summary of Significant Accounting Policiesof the Notes to Consolidated Financial Statements.
Previous wording
We review the carrying values of goodwill and identifiable intangibles whenever events or changes in circumstances indicate that such carrying values may not be recoverable and annually, on the first day of the fourth quarter. If the carrying value of a reporting unit exceeds its fair value, we record a goodwill impairment loss as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. Refer to Note 9. Goodwill and Other Intangible Assets, net to Consolidated Financial Statements.
Current wording
We review the carrying values of goodwill and identifiable intangible assets whenever events or changes in circumstances indicate that such carrying values may not be recoverable and annually, on the first day of the fourth quarter. If the carrying value of a reporting unit exceeds its fair value, we record a goodwill impairment loss as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. Refer to Note 9. Goodwill and Other Intangible Assets, net of the Notes to Consolidated Financial Statements.
Previous wording
Revenue is adjusted for variable consideration, which includes customer volume rebates and prompt payment discounts. We measure variable consideration by estimating expected outcomes using analysis and inputs based upon anticipated performance, historical data, and current and forecasted information. Customer returns are recorded as a reduction to sales on an actual basis throughout the year and also include an estimate at the end of each reporting period for future customer returns related to sales recorded prior to the end of the period. We generally estimate customer returns based upon the time lag that historically occurs between the sale date and the return date, while also factoring in any new business conditions that might impact the historical analysis such as new product introduction. Measurement of variable consideration is reviewed by management periodically and revenue is adjusted accordingly. We do not have significant financing components. Refer to Note 5. Revenue Recognitionto Consolidated Financial Statements.
Current wording
Revenue is adjusted for variable consideration, which includes customer volume rebates and prompt payment discounts. We measure variable consideration by estimating expected outcomes using analysis and inputs based upon anticipated performance, historical data, and current and forecasted information. Customer returns are recorded as a reduction to sales on an actual basis throughout the year and also include an estimate at the end of each reporting period for future customer returns related to sales recorded prior to the end of the period. We generally estimate customer returns based upon the time lag that historically occurs between the sale date and the return date, while also factoring in any new business conditions that might impact the historical analysis such as new product introduction. Measurement of variable consideration is reviewed by management periodically and revenue is adjusted accordingly. We do not have significant financing components. Refer to Note 5. Revenue Recognitionof the Notes to Consolidated Financial Statements.
Previous wording
Significant judgment is required in evaluating tax positions. We established additional reserves for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum recognition threshold. The approach for evaluating certain and uncertain tax positions is defined by the authoritative guidance which determines when a tax position is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, we, along with our subsidiaries, are examined by various federal, state, and foreign tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of our provision for income taxes. We continually assess the likelihood and amount of potential adjustments and adjust the income tax provision, the current tax liability, and deferred taxes in the period in which the facts that give rise to a change in estimate become known. Refer to Note 17. Income Taxesto Consolidated Financial Statements.
Current wording
Significant judgment is required in evaluating tax positions. We establish additional reserves for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum recognition threshold. The approach for evaluating certain and uncertain tax positions is defined by the authoritative guidance which determines when a tax position is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, we are examined by various federal, state, and foreign tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of our provision for income taxes. We continually assess the likelihood and amount of potential adjustments and adjust the income tax provision, the current tax liability, and deferred taxes in the period in which the facts that give rise to a change in estimate become known. Refer to Note 17. Income Taxesof the Notes to Consolidated Financial Statements.
Previous wording
Litigation, Environmental Matters and the Reimbursement Agreement
Current wording
Litigation, Environmental Matters and the Indemnification Agreement
Previous wording
Refer to Note 2. Summary of Significant Accounting Policies to Consolidated Financial Statements.
Current wording
Refer to Note 2. Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements.
Previous wording
“expects,” “projects,” “forecasts,” “intends,” “plans,” “continues,” “believes,” “may,” “will,” “goals,” and words and terms of similar substance in connection with discussions of future operating or financial performance. This Annual Report includes industry and market data that we obtained from various third-party sources, including forecasts based upon such data; as with any projection or forecast, forward-looking statements are inherently susceptible to uncertainty and changes in circumstances. Our actual results may vary materially from those expressed or implied in our forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statement made by us or on our behalf. Although we believe that the forward-looking statements contained in this Annual Report are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in such forward-looking statements, including but not limited to:
Current wording
This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts, but rather are based on current expectations, estimates, assumptions, and projections about our industries and our business and financial results. Forward-looking statements often include words such as “anticipates,” “estimates,” “expects,” “projects,” “forecasts,” “intends,” “plans,” “continues,” “believes,” “may,” “will,” “goals,” and words and terms of similar substance in connection with discussions of future operating or financial performance. This Annual Report includes industry and market data that we obtained from various third-party sources, including forecasts based upon such data; as with any projection or forecast, forward-looking statements are inherently susceptible to uncertainty and changes in circumstances. Our actual results may vary materially from those expressed or implied in our forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statement made by us or on our behalf. Although we believe that the forward-looking statements contained in this Annual Report are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in such forward-looking statements, including but not limited to:
Previous wording
•the potential adverse impacts of enhanced tariff, import/export restrictions, or other trade barriers on global economic conditions, financial markets, and our business;
Current wording
•the potential adverse impacts of tariffs, import/export restrictions, or other trade barriers on global economic conditions, financial markets and our business;
Previous wording
•the impact of potentially volatile global market and economic conditions and industry and end market cyclicality, including factors such as interest rates, inflation, energy costs, availability of financing, consumer spending habits, and preferences, housing market changes, and employment rates;
Current wording
•the impact of potentially volatile global market, geo-political and economic conditions and industry, and end market cyclicality, including factors such as interest rates, inflation, energy costs, availability of financing, consumer spending habits, and preferences, housing market changes, and employment rates;
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
•risks associated with the Reimbursement Agreement, the other agreements we entered into with Honeywell in connection with the Spin-Off, 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 recruit and retain qualified personnel and to recruit a new CEO given the announced intended retirement of our current CEO;
Current wording
•our ability to recruit and retain qualified personnel;
Previous wording
•the CD&R Stockholder’s interest in and influence over us that may diverge from, or event conflict with, interests of the holders of our common stock, and the reduction in the relative voting power of holders of our common stock resulting from the issuance of preferred stock;
Current wording
•the CD&R Stockholder’s interest in and influence over us that may diverge from, or even conflict with, interests of the holders of our common stock, and the reduction in the relative voting power of holders of our common stock resulting from the issuance of preferred stock;
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
•impairment of other intangible assets and long-lived assets;
Current wording
•impairment of goodwill, other intangible assets, and long-lived assets;
Previous wording
•other risks detailed under the caption “Risk Factors” in this Annual Report, in Part I, Item 1A; and
Current wording
•other risks detailed under the caption “Risk Factors” in this Annual Report, in Part I, Item 1A. Risk Factors; and
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts, but rather are based on current expectations, estimates, assumptions, and projections about our industries and our business and financial results. Forward-looking statements often include words such as “anticipates,” “estimates,”