ADT announces executive leadership changes, Q1 results

BOCA RATON, Fla.—ADT Inc. announced several changes to its leadership, starting with the retirement of Jim Boyce, president, chief business development officer, effective May 31, 2021. The company also announced its Q1 financial results, showing continued recovery and growth and the commercial side of the business.

Leadership Changes

The company is grateful for Boyce’s leadership, wisdom and dedication, and for his many contributions as CEO of Defenders and its successful integration into ADT. Boyce will continue to advise the company’s President and CEO Jim DeVries on a consultative basis.

“I want to congratulate Jim Boyce on a well-deserved retirement and thank him for being a trusted friend and partner for many years,” DeVries said. “With Jim’s upcoming departure and our renewed focus on growth, we’ve realigned and enhanced our team, ensuring we’re building a strong leadership group that will serve ADT well into the future.”

With Boyce’s retirement, Jeff Likosar has been named Chief Financial Officer and president, corporate development, and will assume responsibility for corporate strategy, business development, partnerships and communications, in addition to his current responsibilities as CFO. Supporting Likosar will be company veteran Ken Porpora, who has been promoted to Executive Vice President, Finance. 

Keith Holmes will join ADT later this month as executive vice president and chief revenue officer, reporting directly to DeVries. Holmes comes to ADT from Cox Communications, Inc., where he served most recently as executive vice president, head of Cox Business. At ADT, Holmes will lead go-to-market activities and teams, including marketing, sales execution, offer development, and pricing – all key drivers of the company’s long-term revenue growth.

Don Young, who was serving as the company’s Chief Information Officer and Executive Vice President, Field Operations, has been named Executive Vice President and Chief Operating Officer. In this role, he will now also oversee all aspects of service delivery to customers.

Jill Greer joined ADT in April 2021 as Senior Vice President – Finance, Investor Relations and Communications, reporting to Likosar. Greer comes to ADT after a long career with Delta Air Lines, where she served as Vice President – Investor Relations.

ADT Reports First Quarter 2021 Results

ADT announced a number of operational highlights in reporting results for the first quarter of 2021 on Wednesday, May 5. Among the financial results announced for Q1 2021 were:

• New recurring monthly revenue (RMR) additions up 25 percent versus prior year
• Commercial recovery continues; improved year-over-year results
• Quarterly net subscriber growth of 76,000
• Attrition remained at 13.1 percent and improved 40 bps from Q1 2020
• Continued progress on ADT/Google partnership and next-generation platform development

“The priority for ADT in 2021 is to drive revenue expansion through investments in new subscriber growth, strategic partnerships, and exceptional customer service,” said Jim DeVries, ADT President and CEO. “Our first quarter results show that the strategy is working – we grew RMR additions by double-digits and increased our net subscribers, while also maintaining our revenue payback at 2.2 years. We have good momentum in the business as we continue to expand and enhance our offerings to protect our customers at home, at work, and on the go.”

Total revenue declined 5 percent year over year to $1,305 million, driven primarily by the $82 million decrease in installation and other revenue which largely reflects the non-cash impact of ownership model changes made in 2020. Monitoring and related services revenue was up $17 million or 2 percent, driven by an increase in recurring monthly revenue and improved customer retention. Commercial installation and other revenue increased from a year ago reflecting higher outright sales revenue.

With strong customer satisfaction and lower than normal customer relocation activity, trailing 12-month gross customer revenue attrition remained at 13.1 percent. Trailing 12-month customer revenue payback remained at 2.2 years.

ADT reported a net loss of $48 million, an improvement to prior year’s net loss of $300 million. Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $542 million, relatively flat to the prior year, driven primarily by improved Commercial performance, partially offset by a lower volume of outright sales to residential customers.

Adjusted Free Cash Flow was $64 million, down from $173 million in the prior year period. The decrease was driven by higher subscriber acquisition costs to fund significant customer and RMR additions.

Business Highlights included the Google Nest Product Integration, as well as increasing scale in the commercial business. During the first quarter, ADT Commercial continued to expand its nationwide geographic footprint with the acquisition of SAFE Electronics, Inc., based out of Las Vegas, Nev.

Effective May 5, 2021, ADT’s board of directors declared a cash dividend of $0.035 per share to holders of the company’s common stock and Class B common stock of record as of June 17, 2021. This dividend will be paid on July 1, 2021.

ADT is reaffirming its full-year 2021 guidance given in February 2021. With strong demand for its products and services, ADT is increasing spending on subscriber acquisition costs and other technology investments, which the company believes will drive full-year RMR (recurring monthly revenue) growth in the mid-teens.