Executive Summary
Allegion plc delivered a solid QQ3 2025 performance with revenue of $1.0702 billion, up 10.7% year over year and 4.7% quarter over quarter, underscoring resilient demand for security solutions across commercial, institutional, and residential markets. The company achieved an EBITDA margin of 25.4% and a net margin of 17.6%, supported by disciplined cost management and favorable product mix. Reported net income of $188.4 million and earnings per share (EPS) of $2.19 (diluted $2.18) reflect steady profitability while the company continues to deploy capital to support shareholder value, evidenced by a payout ratio of 24.6% and meaningful free cash flow per share (FCF per share) of $2.58 and operating cash flow per share (OCF per share) of $2.82.
Key Performance Indicators
Key Insights
Revenue: $1.0702B, up YoY 10.66%, QoQ 4.72%
Gross Profit: $489.8M, gross margin 45.77%
Operating Income: $233.8M, operating margin 21.85%
Net Income: $188.4M, net margin 17.60%
EPS (diluted): $2.18; EPS: $2.19
EBITDA: $272.2M; EBITDA margin 25.43%
Debt ratio: 0.432; Debt to capitalization: 0.537; Interest coverage: 8.79x
Current ratio: 1.771; Quick ratio: 1.109; Cash ratio: 0.382
DSO: 42.13 days; DIO: 81.39 days; DPO: 40.05 days; CCC: 83.47 days
Cash per share: $3.52; Operating cash flow per sha...
Financial Highlights
Revenue: $1.0702B, up YoY 10.66%, QoQ 4.72%
Gross Profit: $489.8M, gross margin 45.77%
Operating Income: $233.8M, operating margin 21.85%
Net Income: $188.4M, net margin 17.60%
EPS (diluted): $2.18; EPS: $2.19
EBITDA: $272.2M; EBITDA margin 25.43%
Debt ratio: 0.432; Debt to capitalization: 0.537; Interest coverage: 8.79x
Current ratio: 1.771; Quick ratio: 1.109; Cash ratio: 0.382
DSO: 42.13 days; DIO: 81.39 days; DPO: 40.05 days; CCC: 83.47 days
Cash per share: $3.52; Operating cash flow per share: $2.82; Free cash flow per share: $2.58
Dividend payout ratio: 24.6%; Dividend yield: 0.30%
P/E: 20.22x; Price to Book: 7.83x; Price to Sales: 14.24x
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.07B |
10.66% |
4.72% |
| Gross Profit |
489.80M |
13.35% |
4.99% |
| Operating Income |
233.80M |
8.74% |
6.42% |
| Net Income |
188.40M |
8.15% |
17.97% |
| EPS |
2.19 |
9.50% |
17.74% |
Key Financial Ratios
operatingProfitMargin
21.8%
operatingCashFlowPerShare
$2.82
freeCashFlowPerShare
$2.58
dividendPayoutRatio
24.6%
Management Commentary
No earnings call transcript data was provided in the supplied dataset. As a result, transcript-based themes, management tone, and direct quotes could not be incorporated. Forward-looking commentary, if any, would be drawn from official filings or subsequent communications beyond the provided data.
Forward Guidance
No formal numeric guidance was included in the provided material. Based on Allegion’s QQ3 2025 results and sector dynamics, the following qualitative outlook is suggested:
- Revenue trajectory could remain supported by diversified end-markets (commercial, institutional, residential) and continued demand for smart/connected security solutions. Monitor potential pricing gains, mix effects toward higher-margin electronic security products, and geographic expansion.
- Margin discipline appears stable, with gross margin near 45.8% and operating margin around 21.8%; expect continued cost controls, supply chain resilience, and supplier price normalization to support earnings.
- Key risks include cyclicality of construction and commercial capex, currency translation effects, input cost volatility, and competitive intensity in security hardware and access-control ecosystems. Closely monitor backlog timing, project delays, and renewal/maintenance cycles that influence recurring revenue potential.
- Stockholders should watch capital allocation signals (share repurchases, dividends) given a 24.6% payout ratio and strong FCF per share, balanced against strategic investments and potential M&A opportunities.