Allegion raises 2026 outlook again as third-quarter revenue rises 9.6% from a year earlier to $1.17 billion

Allegion plc lifted its full-year 2026 revenue and adjusted earnings outlook on Thursday after third-quarter net revenues rose 9.6% from a year earlier to $1.17 billion and adjusted diluted EPS climbed 13.0% to $2.60, with the Americas non-residential business carrying the growth.

Tariff refunds flatter reported profit, adjusted EPS strips them out

Revenue rose 9.6% from a year earlier to $1.17 billion, up 7.2% organically, with acquisitions and divestitures adding 2.6 percentage points and foreign currency a 0.2-point headwind. Net earnings were $220.9 million, or $2.59 a diluted share, against $188.4 million and $2.18 a year earlier, and operating income rose 21.7% to $284.6 million. Those reported numbers include $19.9 million of IEEPA tariff refunds booked as an operating benefit and $900,000 of related interest income. The release says the refunds "are excluded from adjusted operating income and adjusted EPS and reflect the impact from refunds received and expected to be received from the U.S. government."

Strip the refund out and operating income was $264.7 million, up 13.22% from $233.8 million. Adjusted operating income, which also removes $8.0 million of restructuring and acquisition and integration costs and $17.0 million of acquired-intangible amortization, rose 12.5% to $289.7 million and took the adjusted operating margin to 24.7% from 24.1%. Reported profit grew more slowly than operating profit because the effective tax rate rose to 17.5% from 9.8%, a low prior-year provision that flattered the year-earlier figure and so made this year's growth look smaller.

The Americas does the work while International slips

Americas revenue rose 11.7% from a year earlier to $942.4 million, or 9.1% organically; non-residential was up low-double digits organically on volume and price, and residential up mid-single digits on price alone. Regional adjusted operating margin widened 20 basis points from a year earlier to 30.1%, and the release credits volume leverage and price for the gain while flagging acquisitions as a 40-basis-point headwind. International revenue of $230.2 million rose 1.8% as reported from a year earlier but fell 0.2% organically as volume declines outweighed pricing, and its adjusted operating margin dropped 40 basis points to 13.9%.

On a like-for-like basis growth accelerated: 7.2% organic in the third quarter versus 6.9% in the second, or 9.6% versus 12.7% on a reported basis, though the sequential step was only 1.83%. Stone credited the quarter to "high-single digit organic revenue growth and low teens adjusted EPS growth led by our Americas non-residential business".

A second raise in three months, and what it leaves open

Full-year reported revenue growth guidance moves to 9.5% to 10.5% from 7.5% to 8.5%, organic growth to 5.0% to 6.0% from 3.5% to 4.5%, and adjusted EPS to $9.05 to $9.10 from $8.85 to $9.00. Reported EPS guidance goes to $8.35 to $8.40 from $7.95 to $8.10; the adjusted range sits higher because the bridge adds about $0.60 a share of acquisition-related amortization and $0.28 of restructuring, M&A and other items, then subtracts a $0.18 benefit from tariff refunds.

The July 23 release made the same move, with Stone saying then: "As a result, we are raising our company’s full-year outlook for revenue and adjusted EPS." Nine-month reported revenue of $3.36 billion was up 10.7% from $3.03 billion, so the new annual range implies slower reported growth in the fourth quarter. The release gives no fourth-quarter revenue, margin or segment guidance, and it carries no analyst estimates, so the quarter cannot be scored as a beat or miss from this document.

Cash flow, buybacks and the 8 a.m. call

Nine-month available cash flow, defined as operating cash flow less capital spending, rose $54.2 million to $539.4 million from $485.2 million, on $604.0 million of operating cash flow. The quarter closed with $388.1 million of cash and $2.03 billion of total debt, after about 800,000 shares were repurchased for roughly $120 million and quarterly dividends of $0.55 a share were paid, about $46 million.

The open questions — the fourth-quarter shape, the timing of refunds still expected, and the weaker European demand the company flagged in July — go to a conference call at 8 a.m. ET on Oct. 22, 2026, the dated event management set in the release.