REZI Filings — Resideo Technologies, Inc. - FilingSpy
REZI
Resideo Technologies, Inc.
One of the world's largest makers of home comfort and safety gear, spun off from Honeywell in 2018. Under the Honeywell Home and First Alert brands it sells thermostats, HVAC controls, and smoke and carbon monoxide alarms used by homeowners and professional contractors. Its name comes from the Latin "residere," meaning "to dwell" or "to remain" — a nod to the home. First Alert's roots trace to BRK Electronics, founded in 1958, which made some of the first residential smoke alarms.
Resideo completes ADI spin-off, leaving the remaining company with nearly all legacy debt and a sharply higher leverage profile.
Resideo shed its largest business. for the remaining company rose 2% to $1.98 billion in the quarter, with reaching 30.0% after tariff refunds, but the story is the August 3 spin-off of ADI Global Distribution, which took 64% of revenue and left Resideo with substantially all of its $3.56 billion in debt. The company is now a smaller, more leveraged entity focused on its Products and Solutions .
Key takeaways
The ADI Global Distribution spin-off was completed on August 3, 2026, removing a business that contributed 64% of consolidated for the first half of the year and leaving Resideo with substantially all pre-existing indebtedness.
Consolidated Q2 rose 2.0% to $1,981 million, driven by $30 million in favorable price and mix and a $6 million currency .
expanded 0.8 points to 30.0%, primarily from a 140-basis-point benefit from tariff refunds, which more than offset a 130-basis-point from unfavorable price and mix.
Section summaries
Management's Discussion and Analysis
Q2 2026 revenue rose 2% to $1.98B with gross margin up 70 bps to 30.0%, aided by tariff refunds, while operating income fell 26% on higher restructuring and separation costs.
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Consolidated grew 2.0% to $1,981 million, driven by favorable price/mix ($30M) and currency ($6M).
fell 26.0% to $131 million, weighed down by $31 million in costs tied to the ADI spin-off and $22 million in restructuring charges.
Products and Solutions rose 4.4% on higher volumes, but segment fell 2.8% as unfavorable price and mix and higher restructuring and legal costs offset the volume gain.
ADI Global Distribution edged up 0.7%, but segment fell 9.9% despite $20 million in tariff refunds, as lower volumes and higher expenses took a toll.
What changed
The ADI spin-off, flagged as a key watch item in Q1 2026, was completed on August 3, 2026, resolving the timeline question but leaving Resideo with a materially higher standalone profile as substantially all pre-existing debt remains with the company.
The Q1 2026 watch item on spin-off separation costs materialized: the $24 million quarterly run-rate stepped up to $31 million in Q2, confirming these costs are escalating as the separation neared completion.
The tariff impact flagged in Q1 2026 reversed in Q2: instead of a margin , the company recorded a 140-basis-point benefit from tariff refunds, though the filing notes this was partially offset by unfavorable price and mix.
ADI Global Distribution's profit margin, watched for stabilization two years after the Snap One acquisition, deteriorated further in Q2 with falling 9.9% despite the tariff refund benefit, as lower volumes and higher expenses persisted.
What to watch
The standalone and profile of the post-spin Resideo, given the $3.56 billion debt load and the loss of ADI's cash flows, and whether the $400 million in new Senior Notes due 2034 issued for the spin-off adds further pressure.
Whether the 140-basis-point benefit from tariff refunds in Q2 is a one-time event or signals a more durable reduction in tariff-related costs, and how the February 2026 tariff surcharge affects cost of goods sold in subsequent quarters.
The trajectory of Products and Solutions now that it is the core business, particularly whether the volume growth seen in Q2 can be sustained and whether restructuring and legal costs recede.
The terms and duration of the with ADI, and whether Resideo can replace the shared corporate services without a material increase in standalone operating costs.
expanded 70 to 30.0%, primarily from a 140 bps benefit from , partially offset by unfavorable price/mix of 130 bps.
declined 26% to $131 million, pressured by $22M in restructuring costs, $31M in ADI Spin-Off separation costs, and higher R&D and SG&A expenses.
Products and Solutions rose 4.4% on higher volumes, but segment fell 2.8% due to unfavorable price/mix, higher restructuring, and legal settlement costs.
ADI Global Distribution edged up 0.7% with favorable price/mix offsetting lower volumes; segment fell 9.9% despite $20M in .
dropped to $3M from $135M, largely due to the $902M termination of the Indemnification liability, while financing cash inflows included $400M from Senior Notes due 2034 issued for the ADI Spin-Off.
Quantitative and Qualitative Disclosures About Market Risk
The company faces interest rate, foreign currency, and commodity price risks, using limited hedging and pass-through strategies to manage exposure.
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Interest rate risk is partially hedged via swaps with a $140 million , converting variable-rate debt to a fixed weighted average rate of 2.23%.
A 100 increase in interest rates would result in approximately $22 million of additional annual .
Foreign currency risk arises from international transactions and monetary assets/liabilities, primarily managed through rather than derivatives.
As of July 4, 2026, the company held no outstanding foreign currency hedging contracts.
Commodity price risk includes exposure to steel, aluminum, copper, and precious metals, which the company attempts to mitigate through customer pricing pass-throughs.
Refer to Note 14. Commitments and Contingencies of the Notes to the Unaudited Condensed Consolidated Financial Statements of this Quarterly Report for a discussion on legal proceedings.
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Refer to Note 14. Commitments and Contingencies of the Notes to the Unaudited Condensed Consolidated Financial Statements of this Quarterly Report for a discussion on legal proceedings.
The ADI spin-off, completed August 3, 2026, removes 64% of consolidated revenue, leaving Resideo with substantially all pre-existing debt and a significantly higher standalone leverage profile.
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ADI contributed 64% of consolidated for the six months ended July 4, 2026, and 27% of consolidated , meaning Resideo loses its largest revenue stream post-spin.
Substantially all pre-existing indebtedness remains with Resideo, while ADI’s and cash flows are removed, materially increasing Resideo’s standalone .
Resideo will depend on ADI for certain corporate and shared services under a transition services agreement; if ADI fails to perform or the services are inadequate, Resideo’s operations and costs could be harmed.
Resideo is also obligated to provide services to ADI during the transition period, which may divert management attention and resources from Resideo’s core operations.
Upon expiration of the transition services agreement, Resideo may be unable to replace ADI’s services on comparable terms, potentially increasing costs or reducing service quality.