AI Takeaway
Allegion (ALLE) posted strong Q1 2026 revenue growth of 9.7% to $1.03B, but operating income slipped 0.6% and EPS fell 7.0% to $1.59 as SG&A costs surged 14.6% and cost of revenue rose faster than sales.
Revenue
$1.03B
++9.74% YoY
EPS (Basic)
$1.60
-6.98% YoY
Operating Income
$195.3M
-0.56% YoY
Filed · Source: SEC EDGAR 10-Q filing
Allegion grew Q1 2026 revenue by 9.7% year-over-year to $1.034B from $941.9M, suggesting solid demand for its security products and solutions, likely aided by pricing actions and/or volume gains.
Source: Source: 10-Q Income Statement Data
Selling, General & Administrative expenses jumped 14.6% YoY to $259.2M from $226.1M, outpacing revenue growth of 9.7% and contributing to operating margin compression from 20.9% to 18.9%.
Source: Source: 10-Q Income Statement Data
Despite higher revenues, operating income declined slightly by 0.6% to $195.3M, and operating margin contracted approximately 200 basis points to 18.9%, reflecting cost pressures from both cost of revenue (+11.5%) and SG&A (+14.6%).
Source: Source: 10-Q Income Statement & Ratio Data
2 more insights available
Upgrade to unlockCost of revenue grew 11.5% and SG&A grew 14.6%, both exceeding revenue growth of 9.7%. If this trend continues, operating margins could compress further, eroding profitability even as the top line expands.
Source: Source: 10-Q Income Statement Data
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $1.80 versus the $1.93 analyst consensus — a -6.9% miss for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $1.03B | $941.9M | +9.74% |
Cost of Revenue | $579.1M | $519.4M | +11.49% |
Operating Income | $195.3M | $196.4M | -0.56% |
EPS (Basic) | $1.60 | $1.72 | -6.98% |
EPS (Diluted) | $1.59 | $1.71 | -7.02% |
SG&A Expense | $259.2M | $226.1M | +14.64% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $5.31B | $4.56B | +16.39% |
Current Assets | $1.42B | $1.46B | -2.65% |
Total Liabilities | $3.21B | $2.96B | +8.58% |
Current Liabilities | $745.8M | $672.4M | +10.92% |
Long-Term Debt | $2.03B | $2B | +1.69% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $101.3M | $104.5M | -3.06% |
Investing Cash Flow | $-96.9M | $-28M | -246.07% |
Financing Cash Flow | $-48.7M | $-91.3M | +46.66% |
Share Buybacks | $40.6M | $40M | +1.50% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 18.9% | 20.9% | -1.96% |
Current Ratio | $1.908 | — | — |
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Allegion reported Q1 2026 revenue of $1.034B, up 9.7% year-over-year, but diluted EPS fell 7.0% to $1.59 from $1.71 in Q1 2025. Operating income declined slightly to $195.3M as SG&A expenses surged 14.6% and cost of revenue rose 11.5%, both outpacing revenue growth.
Allegion's EPS fell 7.0% to $1.59 even as revenue grew 9.7% because operating costs rose faster than sales — SG&A jumped 14.6% to $259.2M and cost of revenue increased 11.5% to $579.1M. This cost inflation compressed the operating margin from 20.9% to 18.9%, reducing profitability per share.
Allegion maintains a current ratio of 1.91, indicating solid short-term liquidity, and operating cash flow of $101.3M. However, long-term debt stands at $2.03B and total liabilities increased 8.6% to $3.21B, while investing outflows surged 246% to -$96.9M, suggesting the company made significant capital deployments during the quarter.
The key risks evident from Allegion's Q1 2026 financials include cost inflation outpacing revenue growth (SG&A +14.6%, COGS +11.5% vs. revenue +9.7%), rising leverage with $2.03B in long-term debt, and a 246% surge in investing outflows that may reflect acquisition integration risks. Operating cash flow also declined 3.1% despite strong revenue growth, signaling potential working capital pressures.
Yes, Allegion's Q1 2026 revenue grew 9.7% year-over-year to $1.034B from $941.9M in Q1 2025. However, this top-line growth was more than offset at the earnings level by rising costs, resulting in a 7.0% decline in diluted EPS to $1.59.