APi Group Corporation

For Q3 2026, APi reported net revenues of $2.55 billion, up 22.5% from $2.09 billion a year ago, with organic revenue growth of 15.7%. Adjusted gross profit margin was 30.3%, down 120 bps year over year, while adjusted EBITDA rose 24.6% and adjusted EBITDA margin improved 20 bps to 13.7%. Adjusted diluted EPS was $0.50, up $0.09 or 22% year over year. Safety Services revenue was $1.66 billion, up 18.5%, with 8.8% organic growth; Specialty Services revenue was $893 million, up 30.7%, with 29.9% organic growth. For 2026, management raised full-year revenue guidance to $9.20 billion-$9.25 billion and adjusted EBITDA guidance to $1.235 billion-$1.255 billion, implying 11% organic revenue growth at the midpoint and adjusted EBITDA margin of 13.5% at the midpoint. Full-year adjusted free cash flow conversion is expected to be approximately 110% of adjusted net income. Other 2026 guide items include interest expense of $155 million, depreciation of $90 million, capex of $105 million, an adjusted tax rate of 23%, corporate expense of $145 million, and adjusted diluted weighted average shares of 437 million.

Russ Becker emphasized that the quarter reflected APi’s culture, inspection-first strategy, and disciplined execution, calling the results a continuation of record performance. He highlighted double-digit organic growth, record backlog, margin expansion, and strong demand across data centers, semiconductors, advanced manufacturing, healthcare, and warehouse/distribution. His tone was confident and upbeat, but he repeatedly stressed discipline on customer selection, project selection, and M&A fit rather than growth for growth’s sake.

David Jackola focused on the hard numbers and drivers: Q3 revenue of $2.55 billion, organic growth of 15.7%, adjusted gross margin of 30.3%, adjusted EBITDA margin of 13.7%, and adjusted EPS of $0.50. He said margin pressure came mainly from project and business mix, early-stage projects, and rising material, fuel, and other costs, partially offset by strong SG&A leverage. On cash and capital allocation, he noted $468 million of adjusted free cash flow for 9M26, 84% conversion on adjusted net income, net leverage of 2.4x, $1.7 billion of capital deployed in the first nine months, $252 million of buybacks through Q3, and another $143 million repurchased in early Q4, with about $607 million remaining authorized.

Analysts pressed management on the durability of long-term targets, the scale and timing of M&A, margin pressure in Safety Services, and how much data-center demand is flowing into recurring inspection/service work. Management said the $10 billion revenue target appears within reach quickly given current organic growth and acquisitions, but the 16% EBITDA margin target still requires work and is a key focus. On margins, David said Safety gross margin pressure was mostly mix-driven and tied to early-stage project work and material cost timing, with improvement expected into 2027. On data centers, management said the segment should be about 12% or a little higher of 2026 revenue as it exits the year, while also noting no broad pushback but some local moratorium risk that they are monitoring and addressing through advocacy.