Thank you for joining us. Welcome to the ADT Incorporated Third Quarter 2020 Earnings Conference Call. Please note that participants are in a listen-only mode and the call is being recorded. After the presentation, there will be a chance for questions. I will now hand the conference over to Derek Fiebig, Vice President of Investor Relations. Please proceed.

Thank you, operator and thank you everyone for joining ADT’s Third Quarter 2020 Earnings Conference Call. This afternoon we issued a press release and a slide presentation on our financial results. These materials are available on our website at investor.adt.com. Our remarks today will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These risks include among others, matters that we’ve described in our press release issued this afternoon and in our filings with the SEC. Please note that all forward-looking statements speak only as of the time they are made and we disclaim any obligation to update these forward-looking statements. During today’s call we’ll also make reference to non-GAAP financial measures. Our historic and forward-looking non-GAAP financial measures include special items which are difficult to predict and/or may be mainly dependent upon future uncertainties. For a complete reconciliation of historical non-GAAP to the most comparable GAAP financial measures, please refer to our press release issued this afternoon and our slide presentation, both of which are also available on our website. With me on today’s call are ADT’s President and CEO, Jim DeVries; our CFO, Jeff Likosar; also joining us in the room and available for Q&A is Don Young, our CIO and EVP of Field Operations; and Jason Smith, SVP of Finance. With that, I’ll turn the call over to Jim.

Thanks, Eric and good afternoon, everyone. We appreciate your interest in ADT. And we're glad you've joined our call today. I'll begin by highlighting our results for the quarter. I'll touch on some growth opportunity areas for us and of course, I'll share an update on our partnership with Google. Jeff will then cover our financial results. ADT had an outstanding third quarter, a testament to the strength of our business model and made possible by the efforts of our 20,000 associates who have served our customers exceptionally well throughout the year. I'm pleased with both our continued operating performance and our financial results. We are increasing our full year 2020 outlook for revenue, adjusted EBITDA, and adjusted free cash flow. We see continued consumer demand in the products and services ADT provides. We're seeing the benefits of near and long term external demand catalysts, urbanization, household formation, growth in smart home adoption, and escalating consumer demand for security. We're also leveraging our strong operational execution and driving internal initiatives leading to our growth. Our progress has led to year-to-date net positive subscriber goals and we were positive for the third quarter on a completely organic basis. Our gross RMR additions were one of a number of highlights for the quarter of 10% in the U.S. on a year-over-year basis. We benefited from the trends I mentioned a moment ago as well as improved marketing efficiency, sales conversion rate, and self-generated field sales volume. Our dealer performance was exceptional. And we're just beginning to see the growth benefits of our DR Horton relationship. With the introduction of our new DIY products, this part of our business also continues to grow, and we're very optimistic about DIY going forward. Capital efficient growth remains our North Star. Revenue payback, a key measure of our subscriber acquisition efficiency, improved substantially versus the prior year as well as sequentially and is now at an all-time low of 2.2 years. We've improved productivity, we've delivered higher installation revenue per job, and we're benefiting from the scale advantages of our higher additions. We're also benefiting from the execution of two of our early 2020 strategic initiatives. Our consumer financing program, launched during the first quarter, continues to deliver great results, and the integration of our Defenders acquisition, which will be completed in a few months, is driving more efficient customer acquisition. Both initiatives are helping to create sustainable improvements in our efficiencies and costs. Now I'll turn to customer retention, which we continue to improve in the third quarter. As of September 30, our trailing 12 months' attrition is at a record best 12.9%, an improvement of 60 basis points versus the prior year which was widespread across our residential business. I'm proud of our care centers and our work-from-home performance, which actually started strong earlier this year and has steadily improved over time. During the pandemic, ADT monitoring maintained healthy customer satisfaction and Net Promoter scores. We’re obviously very pleased with our improvements in customer retention. The magnitude of the change underscores our performance as well as the ADT value proposition to our customers. I would note though, as we've shared in the past, we don't look at attrition in isolation. We weigh it with other metrics such as revenue payback and growth; we're focused on optimizing the entire economic equation for capital efficient growth. Although we're beginning to see early signs of an uptick, our sales to commercial customers have clearly been impacted by the pandemic. On a sequential basis, total commercial revenue improved modestly in the third quarter, monitoring and service revenue has been stable. And we've grown RMR from commercial customers on a year-to-date basis. New installation volume is improving, and we're encouraged that our third quarter sales increased from second quarter levels. Our backlog for both installation and recurring monthly revenue ended the quarter as our best position of the year. Dollar Tree/Family Dollar is off to an excellent start and Operation Wolfspeed, the federal program associated with the distribution of potential COVID-19 vaccination was a recent win for ADT Commercial. We've been entrusted to secure distribution centers on behalf of one of the government authorized distributors for a vaccine. And this is yet another clear validation of our business. Looking ahead, while there are still a number of economic and political uncertainties, we're optimistic about our ability to compete in the commercial space and returning to growth in 2021. High quality commercial talking acquisitions will continue to be a part of our playbook. And as the economy recovers, we remain optimistic about this part of our business. Turning to our Google partnership, we're off to an excellent start, and have two important updates to provide. First, through the coordinated efforts of a number of our existing partners, Google and ADT associates, we will be accelerating the timing of when we roll out our first ADT plus Google professional to reform the offering. The second update is that we finalized our interactive platform strategy. ADT will develop and own our next generation platform. I'll share a bit more on both updates. First, the accelerated offering. We now plan to go-to-market with a first generation do-it-for-me or professionally installed offering in partnership with Google in the second half of 2021. The offering will feature co-branding approval, integrate Google Nest products, and offer their extraordinary video analytics platform. This offering will leverage our recently introduced and very well received Command and Control platform to the end of 2022. With this first generation offering, we’ll pull many of what we described as horizon two benefits expected to occur in 2022 into 2021, allowing us to go-to-market at ADT plus Google much sooner. This combined with the momentum we are already seeing in our core business will accelerate our ability to capitalize on the growth of the home automation market. Now more about our platform decision, when we first announced the Google investment in ADT and the long term strategic partnership, we shared that one key outcome of the relationship would be a next generation platform, with new home security and automation products and peripherals, deeper device integration and enhanced alarm verification. Following a comprehensive review of our alternatives, we've concluded that ADT should and will own our next generation platform, which will be developed entirely within Google Cloud. Further, the platform will be developed in coordination with Google to leverage native integration and the multitude of works with Google integration already available. Our decision allows ADT to have full control of our future roadmap and will enable ADT plus Google to deliver operational and efficiency benefits, better long-term economics, and ensure that we continue to be the leader in home automation and security into the future. Our development work is already well underway with teams from both ADT and Google engaged. As a reminder, our partnership includes a commitment for Google to contribute $150 million subject to certain milestones towards the development of new technology, marketing investments, customer acquisition and related employee training and other expenditures. In summary, we’re very pleased with the partnership and early progress we’ve made with Google, and as I already described, we’re also excited about the momentum of our current business, which we expect to continue into the fourth quarter and into 2021. With that, I will now turn the call over to Jeff to cover our financial results and 2020 financial outlook.

Thank you, Jim, and thank you everyone for joining today’s call. As Jim mentioned, we have performed very well during the challenging 2020 macroeconomic environment and we are very pleased with our overall third quarter results and our improved outlook for the full year. We are even more excited about the actions we have taken and progress we have made during 2020 to position ADT for long-term growth and success. Our strong performance this year continues to demonstrate the resilience of our business and the fortitude of our teams who have risen to the challenge and remain passionately focused on delivering for our customers in both the near and longer term. I will summarize some of our key financial and operational measures along with a brief update on our outlook and will then open the call for questions. Our total reported revenue in the quarter was essentially flat year-over-year, despite the 2019 distribution of our Canada operations, which previously represented approximately 4% of our revenue. Installation and other revenue increased by $46 million, driven mainly by higher reported residential outright sales revenue resulting from the Defenders acquisition. This increase was partially offset by lower installation revenue to commercial customers, resulting from the COVID-19 driven economic challenges we have encountered in that part of our business during 2020. Monitoring services revenue declined by 4% on a total company basis, and was up slightly year-over-year excluding the effects of the Canada disposition. Our ending recurring monthly revenue or RMR balance, a primary driver monitoring and services revenue grew by approximately 2% in the U.S., compared to the prior year, including an increase in commercial RMR. Our highlight in the quarter, which Jim already mentioned, was improvement in our gross revenue attrition, which declined by approximately 60 basis points versus the prior year to a record low of 12.9%. Our improvement here was again driven by several factors, including continued focus on service, the effectiveness of our retention initiatives, and some of the environmental tailwinds, Jim described, including fuel relocations. Our adjusted EBITDA of $564 million was up slightly on a sequential basis compared to the second quarter. Our cash generation remained very strong both in the third quarter and year-to-date, despite higher cash interest due to a shift in coupon timing, which will reverse in the fourth quarter. We generated $127 million of adjusted free cash flow during the third quarter, and through the first nine months of 2020, our adjusted free cash flow of $532 million is up more than 15% from the $459 million during the same period in 2019. Our strong year-to-date cash performance comes from a variety of factors that more than offset the higher cash interest, including subscriber acquisition cost efficiency and the benefits from some favorable cost base trends in our current operating environment, along with some timing items. A highlight of our strong cash performance is that we have concurrently grown our subscriber in our RMR base, which has been enabled by improved efficiency in net subscriber acquisition costs or SAC. During the third quarter, we decreased our net SAC by 1% while rolling our additions to RMR by 7%. Excluding the effect of the Canada disposition, our U.S. RMR additions grew by 10%. This substantial RMR growth on lower net SAC led to our best-ever revenue payback at 2.2 years on a trailing 12-month basis, down from 2.4 years a year ago. As Jim shared earlier, the benefits of our consumer financing program, better pricing and other sales and marketing efficiencies, including benefits from the Defenders acquisition contributed to this improvement. After two full quarters of our new pricing and financing model, we are very pleased with the progress we have seen in higher installation revenue per unit from our residential customers. Additionally, the mix shifts towards non-capitalized SAC driven in the third quarter mainly by legacy Defenders outright sales was less pronounced than during the first half due to our ongoing transition to our historical ADT ownership model, which will continue as we further integrate Defenders. Overall, we delivered very solid operational and financial results during the quarter despite the COVID-19 challenges. And we did so while also improving our longer-term position due to progress on the Google partnership and several other initiatives. Turning now to the balance sheet, we also continue to improve our capital structure during the third quarter. A highlight is that we issued $1 billion of new 2027 notes and used the proceeds to redeem our 2021 notes. We priced this issuance with a three and three eights percent coupon substantially lower than the six and a quarter percent coupon on our 2021 notes, which will result in run rate interest savings of almost $30 million. Collectively, after a series of transactions during 2019 and 2020, we have decreased our average borrowing cost by approximately 100 basis points. Additionally, with the closing of the Google transactions, we received $450 million in cash for Google's investments and approximately 55 million shares of ADT Class B common stock. As we have described, we intend to use proceeds from the Google transaction for a combination of debt funding and debt repayment. And to that end, we are announcing today our intent to repay a minimum of $300 million of debt during the fourth quarter of this year. Before moving to Q&A, I want to share a brief update on our outlook for full year 2020. As you mentioned, our business continues to perform well and exceeded our expectations during the third quarter. We consequently are once again revising our full year outlook higher. Our new revenue range is $5.2 billion to $5.35 billion, up from $5.05 billion to $5.3 billion. Our revised adjusted EBITDA range is $2.15 billion to $2.25 billion, an improvement from $2.1 billion to $2.2 billion previously. And our refreshed adjusted free cash flow range is $650 million to $725 million, compared to the prior range of $625 million to $725 million. As always, we will continue to balance short and longer-term objectives with a focus on the pursuit of selected incremental growth investments to generate future period returns, some of which we are considering during the remainder of 2020. As we developed our 2021 plans, we are focused on investing in and positioning our company for long term growth and building on progress from the past few years. We look forward to sharing more on our next earnings call in early 2021. To conclude my comments today, I want to emphasize that we are very pleased with our strong results through the first nine months of 2020. We are thankful for our committed team of 20,000 employees and their perseverance and performance during a challenging year. And we are excited by the progress we have made positioning ADT for the longer term and by the resulting opportunities in front of us. Thank you again everyone for being on today's call. Operator, we will now open the line for questions.

Thank you. Our first question comes from George Tong with Goldman Sachs. Please go ahead with your question.

Hi, thanks. Good afternoon. You're accelerating the launch of the professionally installed co-branded offerings with Google into 2021. Can you elaborate on the product roadmap for the Google partnership and how it may pertain to your partnership with Alarm.com?

Pardon George. We didn’t – there was some interference on our end, could you repeat that question?

Sure. So again, you talked about accelerating the launch of your professionally installed co-branded offering with Google into 2021. Can you elaborate on the product roadmap for the Google partnership and how it may pertain to your partnership with Alarm.com?

Sure. So I'll give a little bit of detail on the platform decision and the roadmap and then ask Don to add anything that I may have missed. So a few points to make; first, the discussions with Alarm.com that we had, in accelerating the roadmap, resulted in a great outcome for both parties, and included the launch of a first generation ADT Plus Google offering developed to the commitment by Alarm.com that will result in several things. First, it leverages the foundation, and extends command and control until the end of 2022. And then beyond that allows that platform to support our end customers for a very long time. And we believe these customers, which command and control customers with integrated Nest product and services will perform well on an attrition basis. The second thing is that integrated Google Nest devices, and Google Video services will be available, which will accelerate our go-to-market with a co-branded offering in the second half of 2021 instead of mid-2022. So in short, the agreement that we put in place and negotiated with Alarm.com allows us to pull forward many of the benefits that are resident in the ADT Plus Google partnership. Two quick additional points. First, the platform decision and the roadmap really allows us George to control our destiny. Our partnership with Alarm.com has been extraordinary, but we now think, in coordination with Google, that we're better positioned to own and develop our own platform. Two reasons for that; we think at a high level, we'll capture efficiencies, efficiency benefits as a result. And then secondly, the point I made earlier about controlling our destiny, we can better navigate our own unique product roadmap to create differentiation for us in our products and services in a better way.

Hey George, this is Don. Jim explained it very well. Our Pulse and command, as we've discussed, are fully integrated in the second half to bring all Google product leads into our information system. Regarding our new platform, to add a little to what Jim mentioned, we are not only aiming to make our smart platform more intelligent, but also more beneficial. We're leveraging Google's advancements in machine learning and artificial intelligence to enhance what they refer to as in-computing. In today's world, we need to educate our customers and enhance their understanding, improving their delivery systems in different ways through rules and automation. One of our customers may not be smarter in terms of intelligence, but they are more comfortable sharing information with a tool that can produce competing opportunities and automatically generate rules without requiring the customer to have that knowledge themselves. We see this as a way for customers to add value to their systems without needing to invest in additional devices or go through the process of self-education.

Got it. That's helpful. You generated positive net subscriber growth organically in the quarter. Can you discuss the sustainability of this growth in net subscribers and the top factors/initiatives to fuel this growth going forward?

Thanks, George, it’s Jeff. We feel really good about our performance in the quarter. We talk often about balancing various objectives in pursuit of strong ROI over the long term. And in this quarter, we delivered on all of those objectives, we reduced our SAC spending, we improved our customer acquisition efficiency, we exceeded our objectives. And as I said in my prepared remarks, we were really excited that we did that while generating such strong cash flow. So there's a whole variety of factors that goes into that, and many of our own performance has also benefited from some of the macroeconomic and macro environmental factors. We think many of those will stay with us and that we will have some wind at our back for a period of time and continue to drive improvements in the business as we head into 2021. And that's what we're focused on doing.

And our next question comes from the line of Seth Weber with RBC. Please proceed with your question.

Hey, you guys, good evening. I guess just first on the Google announcement. Can you just, I'm just trying to make sure I'm understanding, is the pull forward, is that a more simplified version of what you were planning on rolling out in sort of mid-2021? Or is it basically the same offering, it just got accelerated? And then I guess, you just talked about how that the acceleration weighs on the $150 million marketing spend and how we should think about the timing of that from both you and Google?

Sure. Seth, it’s Jeff. The one thing we’ll roll out with Alarm.com and Google, with video as a part of that, is part of that offering, where we will allow a go-to-market with ADT plus Google in the second half of 2021 is very nearly what we had anticipated rolling out in mid-2022. It's not precisely what we have been trying to do all along in mid-2022, but it has almost all of the benefits and features that we had envisioned, and we'll be pulling forward. In terms of the $150 million from Google that comes in three tranches, the second and third tranches are dependent on volume commitments that we're exceptionally confident we’ll achieve. The first $50 million will go towards product development, marketing, training, in some way, in some proportion that we've not yet finalized. A healthy portion of it will be, will be product development, but exactly how much is yet to be determined.

Okay, and then maybe just switch to the commercial side for a second. I mean your commentary was pretty positive about the backlog and sort of sequentially improving trends there. Can you talk to that part of your business that was growing, double digits pretty nicely, pre-COVID? Do you envision that getting back to sort of a double digit revenue growth once the environment kind of settles down?

Absolutely. We're very optimistic about the commercial business. Total revenues up sequentially in Q3, we believe we'll return to growth in 2021. The business includes a large recurring revenue base, 30%, 35% of the revenue in that business is recurring. So it's boring and, durable, highly diversified stuff. I think we're just shy of 250,000 customers. In the commercial business, we have upside in new and growing verticals, healthcare, education, government, critical infrastructure. And as we talked about a number of times before, we have the best service in the space, and that's the most critical source of differentiation. So we're optimistic about the commercial space and expect to grow again next year.

Perfect. Appreciate it, guys. Thank you very much.

And our next question comes from the line of a name, Pat Knight with Barclays. Please proceed with your question.

Hi, this actually Greg calling on. Maybe this thick on the commercial side, I just wonder what you're seeing from small business customers. As we go further along here, and kind of the stimulus wears off. Are those guys hanging in and what's the outlook factor there?

Yes, we feel good about small business. Your question with regard to how they're doing as the stimulus wears off. So far, we feel good about attrition levels and delinquency in that area. Our business has held strong. And generally speaking, we feel great about the SMB business, and it continued to perform in a healthy way for us.

Yes, the way I might describe it is that our small business customers in general have performed more analogous to our residential customers into our larger commercial customers.

Okay. That makes sense. And then maybe, again, on the Google partnership. I think you said that, very nearly what you anticipated for 2022. Any color on, what will be the things that need to be added from there, what's missing versus initial expectations? And how do you continue to grow once you get the product out in 2021?

Yes, this is Don. So we have mentioned before, we're going to have the Google privacy fully integrated with our command and control and Pulse platforms. On the newer platform, we're looking to go beyond device integration; we're looking for leverage. Now, I mentioned beforehand in computing, in addition to something I didn't mention, which is alarm verification, and a great opportunity to go in and collect data and analyze it, and help verify even score alarm activity in the future. We think that's added value to our customers as a result of some of the things that police departments have across the country, first responders. And we're excited about that. There's also a bit of an imagination phase that begins in 2022 to kind of, opportunity in the possible and I'm looking forward to that.

Okay, thank you.

Our next question comes from the line of Gary Bisbee with Bank of America. Please proceed with your question.

Hey, this is Jay. And I’m on for Gary today. My first question just you’ve marked 300 million of the 450 from the Google investment for debt reduction, is it safe to assume the remaining 150 will be used also for these two initiatives you guys have come in with Google?

Yes, so we said, a minimum of $300 million. We feel really good about our capital structure and the progress we've made over the last couple of years. We've done, I think it's four refinancing transactions between 2019 and 2020 collectively reduced our cost of debt by almost a full point. And the Google proceeds because of our strong cash generation, as we said, are available for a combination of debt repayment and growth. And the reason for now we're saying $300 million or minimum there are because we are continuing to evaluate some of the questions that have already come up and the exact amounts and timing here in addition to some other things related to Google that are on our radar screen for the fourth quarter headed into next year.

Okay. So that could potentially be a reference to that account acquisition that were mentioned in the slide?

Yes. Right. I’d say as the normal course of business things you might pursue M&A that we may pursue, and just trying to remain flexible and nimble as we work our way through budgeting and planning for 2021. And we look out into the horizon, not just for the full quarter that into next year. And, again, we set a minimum of $300 million, but depending on how that plays out, the exact timing, the exact mechanics, and even the exact amount, a little bit still to be determined.

Okay, and then just with regard to Defenders, could you give an update on how it's helping drive customer acquisition and some efficiencies?

That's going on, it's going very well. The integration phase resulted in us capturing both the cost synergies and the revenue synergies that we anticipated. One of the great strengths of Defenders was their direct marketing capability. And together with our own marketing organization, we're seeing terrific benefits in terms of SAC efficiency. And, and I'd say feel great so far about the integration of Defenders.

And one thing I would add, and I love when people ask that question, we even talked about it internally. We have so many things that are working in the positive direction that it becomes difficult to disaggregate each of those things to figure out what's the precise contributions of each one. But when you look at it at all, improvement in our subscriber acquisition efficiency, we have the Defenders integration on some improvements that we've made in marketing more generally have the benefits of our new pricing model that we rolled out just in the first quarter of this year. And then also exposure to some of these trends that you see on the slide, slide five, on our deck around the organization, household formation and each of those dynamics. So we feel really good about all of them. But to be honest, we struggle to precisely parse out our performance into the exact contribution from any one of those factors.

Our next question comes from Jeff Kessler with Imperial Capital. Please go ahead with your question.

Thank you. Could I follow on with regard to some of your metrics, your cost to create and then again, and your cost and your close to serve and attrition? So to some extent, they are interrelated. Getting good customers, obviously, potentially make some longer live. But what I'm asking about is beyond Defenders, and the getting into your third party or your third party financing. How are you using that? And, and how are you finding the ability to effectively make it efficient that they take the right, they finance the right customers for you, and you either take on or finding those other customers that don't meet the standards so that you don't have, so you don't have upticks in attrition so that everybody knows who's on, who's playing them on what board here?

Jeff, this is Jim. I'll take the attrition question, answer it a little more broadly, and then come back to a point on Defenders. And then you touched on consumer financing and how that's going off. Just a little comment on consumer financing, sort of at a high level on attrition. We feel great about retention in the third quarter. As we announced, it was a record low 12.9% for us the improvement was super widespread across geographies, all categories across all. S&B was flat, but residential core commercial improved. But a couple of reminders on attrition; while attrition is an important metric and all attrition, bad attrition, it's only a part of the value equation along with other measures cost to acquire probably the most important. And then secondly, and to your question when we acquired Defenders, we continue to receive chargeback benefits for accounts sold to the acquisition. And that benefit expires over a 12 month period and will be a slight metric headwind in the subsequent 12-month period for us. So we feel great about customer retention. We're optimistic about it from a long-term perspective, especially as we enter the Smart Home space more assertively. We know more customers use their systems. The more devices are plentiful in the home, the more the systems are integrated into their daily activities, that retention improves but because they are charged back some Defenders will go away. In January, it will be a slight metric headwind in the subsequent 12 months.

And Jeff, start of your question, where you even talked about cost to create cost to serve? And yes, it's kind of similar, similar to George's question. I mean, those things along the growth, along with cash generation are what we seek to balance every period. We talk about how we're not trying to optimize anyone, but in the third quarter, like we achieved or exceeded our objectives on every single one of those, so we feel really good about our performance in that regard. And then you know, there's some noise in year-over-year because of the Canada disposition to Defenders acquisition, roll out of the via financing and ownership model that goes with it. But really good about overall performance, is the way we feel. And then when you ask more specifically about financing in customer selection, I would emphasize that the growth that we've generated in our RMR additions is coming at higher average install revenue per unit. And a significant driver for that, notwithstanding my earlier point about the difficulty parsing every factor, but one of the drivers is for sure our new pricing and our financing model. So we're using it as a selling tool. Buying large is a selling tool for all customers. But all customers don't end up taking the financing options and in many cases we use it as a selling tool, but we end up collecting upfront in cash, and then your question about how we select it's based on a combination of the customer, and the order size and the credit scoring. It's the same kinds of things that we've used historically. And then just a reminder, in terms of how it works, the customers' relationship is with ADT, we offer the financing ADT team, and then we monetize it in partnerships with Mizuho bank with an advance rate that is based on some of the same characteristics I just described. But we're only two full quarters then off to a really, really good start. And we'll continue to fine-tune exactly how we present the offer to maximize the effectiveness and utilization over time.

My follow-up is regarding your commercial industrial business. I know it has been mentioned a few times, but could you provide more clarity on the specific areas or types of accounts, such as national accounts or large campus businesses? Where are you starting to see people able to get back on premises for installations, and where are you successfully negotiating agreements to ease that process? Given that the pandemic is ongoing, how are you adapting on the commercial side to maintain those numbers?

Now, Jeff, it's Jim. I believe that as customers adapt to the pandemic, we are seeing benefits unfold. Our ability to access on-premises locations has significantly improved compared to three or four months ago. We recognize there is still some uncertainty regarding the market, given the ongoing pandemic and economic conditions. However, we ended Q3 with strong backlogs, with the highest figures this year being comparable to the same date last year. We also experienced solid sales and installations in October. This progress is broadly diversified and largely dependent on gaining access to premises. As I previously mentioned, we are optimistic about the commercial business and expect to return to growth next year.

And, Jeff, I would add to that. We're building a little bit on some of what I was saying earlier about all the factors that go into this year between Canada and Defenders new pricing model. It's also of course, a higher degree of uncertainty with COVID-19. And some of the challenges to the top line, especially in our commercial business, it partially offsets by some benefits from lower spending in other parts of the business that perform very, very well. It's increasingly clear that we have this exposure to these favorable environmental trends. But as we go into 2021 planning, for sure it is a higher degree of uncertainty that we're managing through to build on those trends and manage that uncertain environment, including commercial recovery returned to normal behaviors more and more generally. And we're really focused on strengthening our capability to grow our subscriber in our additional for the long term, including consideration of investment in the Google partnership platform, other initiatives. And, and you will of course talk more about the future in 2021 on our call early in the New Year.

Great. Thank you very much.

Next question comes from the line of Tad with JPMorgan. Please proceed with your question.

Hi, I'm wondering if you're going to take any steps to better align your compensation to ESG metrics and execution. And then as a follow up to that, I'm wondering what is being done at the board level with regard to the underperformance of the stock? Thank you.

Yes, I'll answer the question. In terms of management compensation, we have a program that focuses heavily on equity. The management team is very much aligned with shareholders. We believe that the design of the annual incentive plan effectively motivates management to drive leading indicators that will eventually be reflected in the stock price. Regarding your question about the board, we are not prepared to discuss board interaction and planning during this call.

Yes, just a couple of things. So needless to say, we're very pleased with our operational and financial results. Our 10% growth in RMR additions, record low revenue payback of 2.2 years, the mix of growth, record low attrition all serve to underscore our strong operating capability and a really highly durable business model. The Google partnership is off to an outstanding start. And we're very optimistic about our trajectory going forward. So thank you everybody for calling in tonight and have a great evening.

This does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your line.