APi’s second quarter results drew a positive market response, driven by robust organic revenue growth and notable execution in both core business segments. Management attributed the outperformance to a combination of strong project activity, expanding inspection and service revenues, and continued pricing improvements. CEO Russell Becker highlighted the significance of double-digit inspection revenue growth in North America and a resilient international performance, stating, “Our North American Safety business achieved double-digit inspection growth for the 20th straight quarter.” CFO Glenn Jackola pointed to a record backlog and the impact of disciplined customer and project selection as additional key factors supporting margins and growth.
Is now the time to buy APG? Find out in our full research report (it’s free).
APi (APG) Q2 CY2025 Highlights:
- Revenue: $1.99 billion vs analyst estimates of $1.89 billion (15.1% year-on-year growth, 5.1% beat)
- Adjusted EPS: $0.39 vs analyst estimates of $0.37 (4.2% beat)
- Adjusted EBITDA: $272 million vs analyst estimates of $264.9 million (13.7% margin, 2.7% beat)
- The company lifted its revenue guidance for the full year to $7.75 billion at the midpoint from $7.5 billion, a 3.3% increase
- EBITDA guidance for the full year is $1.03 billion at the midpoint, above analyst estimates of $1.01 billion
- Operating Margin: 7.2%, in line with the same quarter last year
- Organic Revenue rose 8.3% year on year vs analyst estimates of 4.1% growth (417.6 basis point beat)
- Market Capitalization: $14.75 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From APi’s Q2 Earnings Call
- Timothy Michael Mulrooney (William Blair) asked how APi’s revenue exceeded internal guidance. CFO Glenn Jackola attributed the beat to strong project activity and some pull-forward of materials, but noted margin pressure from rising material costs.
- Andrew John Wittmann (Baird) questioned whether the improved guidance reflected a stronger base business or just M&A and Q2 overdelivery. Jackola clarified that roughly one-third of the guidance increase was due to a better second-half outlook, with the remainder from M&A and Q2 results.
- Julian C.H. Mitchell (Barclays) pressed for details on Safety segment growth consistency and the elevator business. Jackola projected steady mid-single-digit growth for Safety, while CEO Russell Becker described the new elevator acquisition as accretive and strategically valuable, especially in the Northeast.
- Jasper James Bibb (Truist Securities) sought color on Specialty project pipelines and margin outlook. Becker emphasized a solid and diversified backlog, with Jackola expecting sequential margin improvement as the year progresses.
- Tomo Sano (JPMorgan) asked about the impact of AI and digital strategies on margins. Jackola and Becker said technology would drive efficiency and scalability, especially as labor constraints persist, but noted efforts are in early stages.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will closely monitor (1) the pace of margin improvement in the Specialty Services segment as material cost pressures and project ramp-up effects moderate, (2) the execution and integration of recent acquisitions, particularly in the elevator and fire/security verticals, and (3) continued growth in recurring inspection and service revenues, which underpin APi’s shift toward a higher-margin, service-focused model. The company’s adoption of digital tools and progress on systems investments will also be key indicators of future operational leverage.
APi currently trades at $35.60, up from $34.45 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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