ADI Global Distribution Posts $655 Million Loss and Cuts 2026 Outlook
Key Facts
ADI Global Distribution reported on November 12, 2026, results for the third quarter ended October 3, posting a net loss of $655 million, compared with net income of $26 million in the same period of 2025. The loss included a noncash goodwill impairment charge of $659 million, even as revenue increased. The results are for ADI Global Distribution, listed on the New York Stock Exchange under the ticker ADIG, a distributor of low-voltage products. Investing.com reported that the stock fell 0.66% in premarket trading after the announcement. Chief Executive Rob Aarnes said quarterly profitability came in below the company’s expectations, citing continued weakness in the housing market, soft demand and product mix.
Net sales totaled $1.306 billion, up 8.6% year over year, according to the company’s statement. ADI attributed the growth to a 5% increase in average daily sales and two additional selling days in the current quarter. The comparison also benefited from a weaker base in the year-earlier quarter, when revenue was affected by disruptions related to the Americas enterprise resource planning system conversion. Revenue growth did not translate into profitability to the same extent, as the company said quarterly earnings fell short of expectations. It cited a decline in residential audio-video sales, partly offset by growth in security, pro audio-video, fire and life safety, and communications. The company linked lower residential audio-video sales to continued weakness in the U.S. housing market.
Gross margin fell to 20.9% in the third quarter from 22.6% in the third quarter of 2025, according to the earnings statement. The company attributed the margin pressure to customer and product mix, inventory charges, and comparison with a temporary benefit from tariffs in the prior year. Aarnes added that demand and product mix in Exclusive Brands offerings were weaker than expected. He said a larger share of commercial sales to national accounts and projects, which carry lower margins, also weighed on profitability. These factors show that overall revenue growth coincided with divergent performance across product categories and a greater sales mix toward lower-profit businesses. The company described the results as below its standards and also linked them to weak third-quarter demand.
ADI said the $659 million goodwill impairment charge resulted from an interim quantitative test, following continued weakness in the residential market and lower earnings and cash flow expectations, as well as declines in the share price and market capitalization. The charge was noncash, but lifted the reported net loss to $655 million for the quarter. By comparison, net income in the same period of 2025 was $26 million. The company thus places the goodwill impairment among a set of operating and market pressures that prompted it to revise its outlook. Cash and cash equivalents totaled about $208 million on October 3, 2026, alongside an undrawn $500 million revolving credit facility. The company has traded independently on the New York Stock Exchange since August 4, 2026, following its separation from Resideo.
The company lowered its 2026 revenue outlook to a range of $4.910 billion to $4.930 billion and estimated fourth-quarter revenue at $1.112 billion to $1.132 billion. Aarnes said the reduction reflects the third-quarter shortfall and an expected further deterioration in Exclusive Brands in the fourth quarter, with demand and product-mix pressures continuing through the rest of the year. ADI estimated standalone adjusted EBITDA for 2026 at $230 million to $240 million, compared with a range of $28 million to $38 million for the fourth quarter. It also expects total annual cost savings of about $60 million by the end of 2026 and maintained its target of $80 million on an annualized basis by the end of 2027. Aarnes added that the company is considering further cost reductions alongside its existing savings program. The fourth-quarter estimates and cost-cutting plan are the company’s key indicators for the period ahead.