Allegion plc 10-Q for FY2026 Q3
Allegion plc (ALLE)
10-Q
2026-10-22
For: 2026-09-30
View Original
Added on
October 22, 2026
About this 10-Q
Allegion plc filed this 10-Q on October 22, 2026, covering the quarter ended September 30, 2026 (FY2026 Q3).
Allegion plc delivered high-single digit revenue growth in the third quarter of 2026, driven by pricing, volume growth and acquisitions; operating margin rose to 24.3% from 21.8%. AI summary
Headline figures
Quarter ended September 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.17B
- up 9.6% from $1.07B a year earlier
- Net income
- $220.9M
- up 17.3% from net income of $188.4M a year earlier
- Diluted EPS
- $2.59
- up 18.8% from $2.18 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________
FORM 10-Q
_______________________________
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to
Commission File Number 001-35971
_______________________________
ALLEGION PUBLIC LIMITED COMPANY
(Exact name of registrant as specified in its charter)
_______________________________
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of principal executive offices) | (Zip Code) | ||||
+(353 ) (1 ) 6833399
(Registrant’s telephone number, including area code)
_______________________________
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | ||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
| Emerging growth company | ||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of ordinary shares outstanding of Allegion plc as of October 19, 2026 was 84,321,432 .
ALLEGION PLC
FORM 10-Q
INDEX
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PART I – FINANCIAL INFORMATION
Item 1 – Financial Statements
Allegion plc
Condensed and Consolidated Statements of Comprehensive Income
(Unaudited)
| Three months ended | Nine months ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| In millions, except per share amounts | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net revenues | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Selling and administrative expenses | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Other income, net | ( | ( | ( | ( | |||||||||||||||||||
| Earnings before income taxes | |||||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||
| Net earnings | $ | $ | $ | $ | |||||||||||||||||||
| Earnings per share: | |||||||||||||||||||||||
| Basic net earnings | $ | $ | $ | $ | |||||||||||||||||||
| Diluted net earnings | $ | $ | $ | $ | |||||||||||||||||||
| Weighted-average shares outstanding: | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
| Total comprehensive income | $ | $ | $ | $ | |||||||||||||||||||
See accompanying notes to condensed and consolidated financial statements.
1
Allegion plc
Condensed and Consolidated Balance Sheets
(Unaudited)
| In millions, except share amounts | September 30, 2026 | December 31, 2025 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Accounts and notes receivable, net | |||||||||||
| Inventories | |||||||||||
| Other current assets | |||||||||||
| Total current assets | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Goodwill | |||||||||||
| Intangible assets, net | |||||||||||
| Other noncurrent assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses and other current liabilities | |||||||||||
| Short-term borrowings and current maturities of long-term debt | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Other noncurrent liabilities | |||||||||||
| Total liabilities | |||||||||||
| Equity: | |||||||||||
Ordinary shares, $ | |||||||||||
| Capital in excess of par value | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total equity | |||||||||||
| Total liabilities and equity | $ | $ | |||||||||
See accompanying notes to condensed and consolidated financial statements.
2
Allegion plc
Condensed and Consolidated Statements of Cash Flows
(Unaudited)
| Nine months ended | |||||||||||
| September 30, | |||||||||||
| In millions | 2026 | 2025 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net earnings | $ | $ | |||||||||
| Adjustments to arrive at net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Changes in assets and liabilities and other non-cash items | ( | ( | |||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | ( | ( | |||||||||
| Acquisition of businesses, net of cash acquired | ( | ( | |||||||||
| Other investing activities, net | ( | ||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
Debt repayments | ( | ||||||||||
Proceeds from Revolving Facility | |||||||||||
| Repayments of Revolving Facility | ( | ( | |||||||||
| Net proceeds from debt | |||||||||||
| Dividends paid to ordinary shareholders | ( | ( | |||||||||
| Repurchase of ordinary shares | ( | ( | |||||||||
| Other financing activities, net | ( | ||||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ||||||||||
| Net increase (decrease) in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents - beginning of period | |||||||||||
| Cash and cash equivalents - end of period | $ | $ | |||||||||
See accompanying notes to condensed and consolidated financial statements.
3
NOTE 1 - BASIS OF PRESENTATION
The accompanying Condensed and Consolidated Financial Statements of Allegion plc, an Irish public limited company, and its consolidated subsidiaries (“Allegion” or the “Company”), reflect the consolidated operations of the Company and have been prepared in accordance with United States (“U.S.”) Securities and Exchange Commission (“SEC”) interim reporting requirements. Accordingly, the accompanying Condensed and Consolidated Financial Statements do not include all disclosures required by accounting principles generally accepted in the U.S. (“GAAP”) for full financial statements and should be read in conjunction with the Consolidated Financial Statements included in the Allegion Annual Report on Form 10-K for the year ended December 31, 2025. In the opinion of management, the accompanying Condensed and Consolidated Financial Statements contain all adjustments, which include normal recurring adjustments, necessary to state fairly the consolidated unaudited results for the interim periods presented.
NOTE 2 - RECENT ACCOUNTING PRONOUNCEMENTS
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU No. 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires disaggregated disclosures of certain categories of expenses that are included in expense line items on the face of the consolidated statements of comprehensive income. This guidance will be effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. This ASU will be applied prospectively and will result in additional required disclosures in the Company’s Consolidated Financial Statements once adopted.
In September 2025, the FASB issued ASU No. 2025-06, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software”, which removes references to prescriptive and sequential software development stages, and requires entities to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended. This guidance will be effective for annual and interim periods beginning after December 15, 2027. This ASU is to be applied prospectively, but retrospective application is permitted. This ASU is not expected to have a material impact to the Company’s Consolidated Financial Statements.
In December 2025, the FASB issued ASU No. 2025-11, “Interim Reporting (Topic 270): Narrow-Scope Improvements”, which creates a comprehensive list of interim disclosure requirements, clarifies the scope and applicability of those interim disclosure requirements, and adds a principle requiring disclosure of material events and transactions that have occurred since the Company’s most recently filed Annual Report on Form 10-K that have not otherwise been disclosed. This guidance will be effective for interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is evaluating the impact of this ASU on its Condensed and Consolidated Financial Statements.
NOTE 3 - ACQUISITIONS
2026
The following are acquisitions made in 2026:
DCI
On March 2, 2026, the Company, through its subsidiaries, acquired 100% of Door Components, Inc. (“DCI”), a manufacturer of custom, quick ship hollow metal doors and frames for industrial, commercial and institutional markets based in the United States. DCI is reported in the Company’s Allegion Americas segment. The purchase consideration, net of cash acquired, was approximately $69.3 million. This acquisition was accounted for as a business combination and was funded with available cash on hand and borrowings under the Revolving Facility.
Overly
On October 2, 2026, the Company, through its subsidiaries, acquired 100% of Overly Door Company (“Overly”), a manufacturer of custom and pre-engineered doors for acoustic, blast, bullet-resistant and vault security based in the United States. Overly will be reported in the Company’s Allegion Americas segment. The purchase consideration was approximately $88.7 million. This acquisition was funded with available cash on hand and borrowings under the Revolving Facility.
As the initial accounting for the Overly acquisition is incomplete, the Company has not provided the aggregate preliminary purchase price allocation for these 2026 acquisitions.
4
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
2025
The following are acquisitions made during the nine months ended September 30, 2025:
Next Door
On February 4, 2025, the Company, through its subsidiaries, acquired Next Door Company (“Next Door”), a global provider of security products and solutions based in the United States. Next Door is reported in the Company’s Allegion Americas segment.
Lemaar
On March 1, 2025, the Company, through its subsidiaries, acquired Lemaar Pty Ltd (“Lemaar”), a global provider of security products and solutions based in Australia. Lemaar is reported in the Company’s Allegion International segment.
Trimco
On April 2, 2025, the Company, through its subsidiaries, acquired 100% of Trimco Hardware ("Trimco"), a manufacturer of high-performance and custom-designed architectural hardware primarily sold for commercial and institutional markets based in the United States. Trimco is reported in the Company's Allegion Americas segment.
Novas
On June 2, 2025, the Company, through its subsidiaries, acquired 100% of Nova Hardware Pty Ltd ("Novas"), an architectural door hardware company based in Australia. Novas is reported in the Company's Allegion International segment.
ELATEC
On July 1, 2025, the Company, through its subsidiaries, acquired 100% of ELATEC, including Elatec GmbH and other group entities ("ELATEC"). ELATEC is a manufacturer of security and access technology based in Germany. This acquisition helps the Company expand its global electronics portfolio in attractive end markets while also increasing strategic relationships with channel partners. The purchase price of the acquisition was €327.9 million (approximately $386.5 million). The Company used cash on hand and borrowings under the Revolving Facility to finance the acquisition. ELATEC is reported in the Company's Allegion International segment.
Gatewise
On July 2, 2025, the Company, through its subsidiaries, acquired 100% of Gatewise Inc. (“Gatewise"), a provider of smart access control solutions in the U.S. multifamily marketplace based in the United States. Gatewise is reported in the Company's Allegion Americas segment.
Waitwhile
On July 7, 2025, the Company, through its subsidiaries, acquired 100% of Waitwhile Inc. (“Waitwhile"), a software-as-a-service provider that specializes in cloud-based appointment scheduling and queue management based in the United States. Waitwhile is reported in the Company's Allegion Americas segment.
UAP
On August 1, 2025, the Company, through its subsidiaries, acquired 100% of UAP Group Limited (“UAP"), a security solutions provider based in the United Kingdom. UAP is reported in the Company's Allegion International segment.
Brisant
On August 12, 2025, the Company, through its subsidiaries, acquired 100% of Brisant Secure Limited (“Brisant"), a security hardware provider based in the United Kingdom. Brisant is reported in the Company's Allegion International segment.
The aggregate purchase consideration for these 2025 acquisitions, net of cash acquired, was approximately $623.8 million. This includes an acquisition-date fair value of $30.3 million for earnout contingent consideration, a portion of which has been settled, while the remainder becomes payable at certain dates through 2028 if certain conditions are achieved. These acquisitions were accounted for as business combinations and were funded with available cash on hand and borrowings under the Revolving Facility.
5
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
The following table summarizes the allocation of the aggregate purchase consideration for these 2025 acquisitions, which includes cash consideration and the estimated fair value of contingent consideration, to assets acquired and liabilities assumed as of the acquisition dates:
| In millions | |||||
| Net working capital | $ | ||||
Property, plant and equipment and other noncurrent assets | |||||
| Goodwill | |||||
| Intangible assets | |||||
Deferred tax liabilities related to acquired intangible assets | ( | ||||
| Other noncurrent liabilities | ( | ||||
| Total net assets acquired and liabilities assumed | $ | ||||
Intangible assets recognized as of the acquisition dates were comprised of the following:
| In millions | Value (in millions) | Weighted average useful life (in years) | ||||||||||||
| Completed technologies/patents | $ | |||||||||||||
| Customer relationships | ||||||||||||||
| Trade names (finite-lived) | ||||||||||||||
Goodwill results from several factors including Allegion-specific synergies that were excluded from the cash flow projections used in the valuation of intangible assets and intangible assets that do not qualify for separate recognition. The majority of the goodwill related to these acquisitions is not expected to be deductible for tax purposes.
The following unaudited pro forma financial information for the three and nine months ended September 30, 2025 reflects the consolidated results of operations of the Company as if these acquisitions had taken place on January 1, 2024:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2025 | 2025 | |||||||||||||||||||||
| Net revenues | $ | $ | |||||||||||||||||||||
Net earnings | |||||||||||||||||||||||
The unaudited pro forma financial information is presented for informational purposes only and is not intended to be indicative of results of operations that would have occurred had the pro forma events taken place on the date indicated or the future consolidated results of operations of the combined company. The unaudited pro forma financial information does not reflect any synergies or other strategic benefits as a result of the acquisitions. The unaudited pro forma financial information is required under GAAP, and has been calculated after applying the Company's accounting policies and adjusting the historical financial results to reflect additional items directly attributable to the acquisitions that would have been incurred assuming the acquisitions had occurred on January 1, 2024, including amortization of acquired intangible assets, interest costs for debt to fund the acquisitions, and acquisition and integration costs.
The following financial information reflects the Net revenues and Earnings before income taxes generated by the businesses since the acquisition dates included within the Company's Condensed and Consolidated Statements of Comprehensive Income:
| In millions | Three months ended September 30, 2025 | Nine months ended September 30, 2025 | |||||||||||||||
| Net revenues | $ | $ | |||||||||||||||
| Earnings before income taxes | |||||||||||||||||
6
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 4 - INVENTORIES
Inventories are stated at the lower of cost and net realizable value using the first-in, first-out (FIFO) method. The major classes of inventories were as follows:
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Raw materials | $ | $ | |||||||||
| Work-in-process | |||||||||||
| Finished goods | |||||||||||
| Total | $ | $ | |||||||||
NOTE 5 - GOODWILL
The changes in the carrying amount of goodwill for the nine months ended September 30, 2026, were as follows:
| In millions | Allegion Americas | Allegion International | Total(a) | ||||||||||||||
| December 31, 2025 | $ | $ | $ | ||||||||||||||
| Acquisitions and adjustments | |||||||||||||||||
| Currency translation | ( | ( | ( | ||||||||||||||
| September 30, 2026 | $ | $ | $ | ||||||||||||||
(a) Accumulated impairment for the International segment was $573.6 million as of September 30, 2026 and December 31, 2025. There is no accumulated impairment for the Americas segment.
There was no impairment of goodwill for the nine months ended September 30, 2026 and 2025.
NOTE 6 - INTANGIBLE ASSETS
| September 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||||||||
| In millions | Gross carrying amount | Accumulated amortization | Net carrying amount | Gross carrying amount | Accumulated amortization | Net carrying amount | ||||||||||||||||||||||||||||||||
| Completed technologies/patents | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
| Customer relationships | ( | ( | ||||||||||||||||||||||||||||||||||||
| Trade names (finite-lived) | ( | ( | ||||||||||||||||||||||||||||||||||||
| Other | ( | ( | ||||||||||||||||||||||||||||||||||||
| Total finite-lived intangible assets | $ | ( | $ | ( | ||||||||||||||||||||||||||||||||||
| Trade names (indefinite-lived) | ||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Intangible asset amortization expense was $55.9 million and $53.0 million for the nine months ended September 30, 2026 and 2025, respectively. Future estimated amortization expense on existing intangible assets in each of the next five years amounts to approximately $75.2 million for full year 2026, $68.5 million for 2027, $59.2 million for 2028, $56.3 million for 2029 and $45.8 million for 2030.
7
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 7 - DEBT AND CREDIT FACILITIES
Long-term debt and other borrowings consisted of the following:
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Revolving Facility | $ | $ | |||||||||
| 3.550% Senior Notes due 2027 | |||||||||||
| 3.500% Senior Notes due 2029 | |||||||||||
| 5.411% Senior Notes due 2032 | |||||||||||
| 5.600% Senior Notes due 2034 | |||||||||||
| Other debt | |||||||||||
| Total borrowings outstanding | |||||||||||
| Discounts and debt issuance costs, net | ( | ( | |||||||||
| Total debt | |||||||||||
| Less current portion of long-term debt | |||||||||||
| Total long-term debt | $ | $ | |||||||||
Unsecured Credit Facilities
The Company has an unsecured revolving credit facility (the “Revolving Facility”) that matures on May 20, 2030, and provides aggregate commitments of up to $1.0 billion, which includes up to $100.0 million for the issuance of letters of credit. As of September 30, 2026, the Company had outstanding borrowings of $240.9 million and letters of credit of $25.3 million. On October 1, 2026, the Company borrowed an additional $40.0 million on the Revolving Facility which was used for the acquisition of Overly. The Revolving Facility is unconditionally guaranteed jointly and severally on an unsecured basis by Allegion plc, Allegion US Holding Company Inc. (“Allegion US Hold Co”), the Company’s wholly-owned subsidiary, and Allegion (Ireland) Finance Designated Activity Company (“Allegion Ireland DAC”), the Company’s wholly-owned subsidiary.
Borrowings under the Revolving Facility are due upon its maturity but may be repaid at any time without premium or penalty, and amounts repaid may be reborrowed. The Company pays certain fees with respect to the Revolving Facility, including an unused commitment fee on the undrawn portion of between 0.080 % and 0.200 % per year depending on the Company’s credit ratings, as well as certain other fees.
Outstanding borrowings under the Revolving Facility accrue interest, at the option of the Company, equal to either: (i) a Secured Overnight Financing Rate (“SOFR”) rate plus an applicable margin or (ii) a base rate (as defined in the credit agreement) plus the applicable margin. The applicable margin ranges from 0.875 % to 1.375 % depending on the Company’s credit ratings. At September 30, 2026, the Company’s outstanding borrowings under the Revolving Facility accrued interest at SOFR plus a margin of 1.125 %, resulting in an interest rate of 4.939 %. The Revolving Facility also contains negative and affirmative covenants and events of default that, among other things, limit or restrict the Company’s ability to enter into certain transactions. In addition, the Revolving Facility requires the Company to comply with a maximum leverage ratio as defined in the credit agreement. As of September 30, 2026, the Company was in compliance with all applicable covenants under the credit agreement.
Senior Notes
As of September 30, 2026, Allegion US Hold Co has $400.0 million outstanding of its 3.550 % Senior Notes due 2027 (the “3.550% Senior Notes”), $600.0 million outstanding of its 5.411 % Senior Notes due 2032 (the “5.411% Senior Notes”) and $400.0 million outstanding of its 5.600 % Senior Notes due 2034 (the “5.600 % Senior Notes”), and Allegion plc has $400.0 million outstanding of its 3.500 % Senior Notes due 2029 (the “3.500% Senior Notes,” and all four senior notes collectively, the “Senior Notes”). The 3.550 % Senior Notes and 3.500 % Senior Notes both require semi-annual interest payments on April 1 and October 1 of each year and mature on October 1, 2027 and October 1, 2029, respectively. The 5.411 % Senior Notes require semi-annual interest payments on January 1 and July 1 of each year and mature on July 1, 2032. The 5.600 % Senior Notes require semi-annual interest payments on May 29 and November 29 of each year and mature on May 29, 2034.
The 3.550 % Senior Notes, 5.411 % Senior Notes and 5.600 % Senior Notes are senior unsecured obligations of Allegion US Hold Co and rank equally with all of Allegion US Hold Co’s existing and future senior unsecured and unsubordinated indebtedness. The guarantee of the 3.550 % Senior Notes, 5.411 % Senior Notes and 5.600 % Senior Notes is the senior unsecured obligation of Allegion plc and ranks equally with all of the Company’s existing and future senior unsecured and unsubordinated indebtedness. The 3.500 % Senior Notes are senior unsecured obligations of Allegion plc, are guaranteed by
8
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Allegion US Hold Co and rank equally with all of the Company’s existing and future senior unsecured indebtedness. As of September 30, 2026, the Company was in compliance with all applicable covenants under the Senior Notes.
NOTE 8 - FINANCIAL INSTRUMENTS
Currency Hedging Instruments
The Company uses foreign currency forward and cross-currency swap contracts to manage the risks associated with currency exchange rate exposures.
In the second quarter of 2026, the Company entered into cross-currency swaps with gross notional amounts totaling $100.0 million maturing in July 2032. These instruments were designated as a net investment hedge of a Euro functional currency denominated subsidiary. Periodic swap interest accruals are recognized in Net earnings and changes in the fair value of the swaps are recorded in Accumulated other comprehensive loss as a component of Currency translation. The Company determined the hedge to be effective at inception of the hedge relationship and assesses effectiveness quarterly by ensuring the net investment in the associated Euro functional currency denominated subsidiaries is greater than the derivative notional amount.
Net investment hedges are used to hedge the foreign currency risk of net investments in foreign operations. Cash flows upon settlement of a net investment hedge and for periodic interest received or paid are classified as investing activities in the Condensed and Consolidated Statements of Cash Flows. Recognition in earnings of amounts previously recognized in Accumulated other comprehensive loss is limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged foreign operation. In the event of a complete or substantially complete liquidation of the net investment, cash flows from net investment hedges are classified as investing activities in the Condensed and Consolidated Statements of Cash Flows.
The gross notional amount of the Company’s currency derivatives was $350.9 million and $320.1 million at September 30, 2026 and December 31, 2025, respectively. Neither the fair values of currency derivatives, which are determined based on a pricing model that uses spot rates and forward prices from actively quoted currency markets that are readily observable (Level 2 inputs under the fair value hierarchy described in Note 11), nor the balances included in Accumulated other comprehensive loss were material as of September 30, 2026 or December 31, 2025. Currency derivatives did not have a material impact to Net earnings, Other comprehensive income, or the Condensed and Consolidated Statements of Cash Flows during the nine months ended September 30, 2026 and 2025, nor is the amount to be reclassified into Net earnings over the next 12 months expected to be material. At September 30, 2026, the maximum term of the Company’s foreign currency forward contracts was less than one year, and the term of the Company’s cross-currency swaps was six years.
Concentration of Credit Risk
NOTE 9 - LEASES
Rental expense for the three months ended September 30, 2026 and 2025, was $19.4 million and $18.3 million, respectively, and rental expense for the nine months ended September 30, 2026 and 2025, was $56.9 million and $51.5 million, respectively. Rental expense is classified within Cost of goods sold and Selling and administrative expenses within the Condensed and Consolidated Statements of Comprehensive Income. Rental expense related to short-term leases, variable lease payments or other leases or lease components not included within the right of use (“ROU”) asset or lease liability totaled $4.5 million and $4.8 million for the three months ended September 30, 2026 and 2025 and $11.9 million and $12.3 million for the nine months ended September 30, 2026 and 2025. No material lease costs have been capitalized on the Condensed and Consolidated Balance Sheets as of September 30, 2026 or December 31, 2025.
The Company assesses the specific terms and conditions of each lease to determine the appropriate classification as either an operating or finance lease and the lease term. Substantially all of the Company’s leases for which the Company is a lessee are classified as operating leases.
9
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
As a lessee, the Company categorizes its leases into two general categories: real estate leases and equipment leases. Amounts included within the Condensed and Consolidated Balance Sheets related to the Company’s ROU asset and lease liability for both real estate and equipment leases were as follows:
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||||||||||||||||||||
| In millions | Balance Sheet classification | Real estate | Equipment | Total | Real estate | Equipment | Total | ||||||||||||||||||||||||||||||||||
| ROU asset | Other noncurrent assets | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Lease liability - current | Accrued expenses and other current liabilities | ||||||||||||||||||||||||||||||||||||||||
| Lease liability - noncurrent | Other noncurrent liabilities | ||||||||||||||||||||||||||||||||||||||||
| Other information: | |||||||||||||||||||||||||||||||||||||||||
| Weighted-average remaining term (years) | |||||||||||||||||||||||||||||||||||||||||
| Weighted-average discount rate | % | % | % | % | |||||||||||||||||||||||||||||||||||||
The following table summarizes additional information related to the Company’s leases for the nine months ended September 30:
| 2026 | 2025 | |||||||||||||||||||||||||||||||||||||
| In millions | Real estate | Equipment | Total | Real estate | Equipment | Total | ||||||||||||||||||||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| ROU assets obtained in exchange for new lease liabilities | ||||||||||||||||||||||||||||||||||||||
Future Repayments
Scheduled minimum lease payments required under non-cancelable operating leases for both the real estate and equipment lease portfolios for the remainder of 2026 and for each of the years thereafter as of September 30, 2026, are as follows:
| In millions | Remainder of 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | Total | |||||||||||||||||||||||||||||||||||||
| Real estate leases | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Equipment leases | ||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
The difference between the total undiscounted minimum lease payments and the combined current and noncurrent lease liabilities as of September 30, 2026, is due to imputed interest of $46.3 million.
NOTE 10 - DEFINED BENEFIT PLANS
The Company sponsors several U.S. and non-U.S. defined benefit pension plans for eligible employees and retirees and also maintains other supplemental plans for officers and other key employees.
On May 31, 2026, the Company transferred obligations of $19.7 million from a U.S. defined benefit pension plan to a third-party insurance company by purchasing a group annuity contract using an equivalent amount of plan assets. The transaction did not have a material impact on the funded status of the pension plan. As a result of the transaction, the Company recorded a $3.7 million settlement charge, which was reflected as a component of Other income, net. The plan’s assets and liabilities were remeasured as of the settlement date, resulting in a remaining projected benefit obligation of $195.9 million, and fair value of plan assets of $207.1 million. The discount rate used to determine the projected benefit obligation at the settlement date was 5.55 %, compared to 5.37 % as of December 31, 2025. The expected long-term return on plan assets remained 6.50 %.
10
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
The components of the Company’s Net periodic pension benefit cost (income) for the three and nine months ended September 30 were as follows:
| U.S. | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Service cost | $ | $ | $ | $ | |||||||||||||||||||
| Interest cost | |||||||||||||||||||||||
| Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
| Settlement charge | |||||||||||||||||||||||
| Administrative costs and other | |||||||||||||||||||||||
| Amortization of: | |||||||||||||||||||||||
| Net prior service costs | |||||||||||||||||||||||
| Plan net actuarial losses | |||||||||||||||||||||||
| Net periodic benefit cost (income) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Non-U.S. | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Service cost | $ | $ | $ | $ | |||||||||||||||||||
| Interest cost | |||||||||||||||||||||||
| Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
| Administrative costs and other | |||||||||||||||||||||||
| Amortization of: | |||||||||||||||||||||||
| Plan net actuarial losses | |||||||||||||||||||||||
| Net periodic benefit cost | $ | $ | $ | $ | |||||||||||||||||||
Service cost is recorded in Cost of goods sold and Selling and administrative expenses, while the remaining components of Net periodic pension benefit cost (income) are recorded in Other income, net within the Condensed and Consolidated Statements of Comprehensive Income. Employer contributions to the plans were not material during the nine months ended September 30, 2026 or 2025, and are not expected to be material for the remainder of 2026.
NOTE 11 - FAIR VALUE MEASUREMENTS
Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value measurements are based on a framework that utilizes the inputs market participants use to determine the fair value of an asset or liability and establishes a fair value hierarchy to prioritize those inputs. The fair value hierarchy is comprised of three levels that are described below:
•Level 1 – Inputs based on quoted prices in active markets for identical assets or liabilities.
•Level 2 – Inputs other than Level 1 quoted prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.
•Level 3 – Unobservable inputs based on little or no market activity and that are significant to the fair value of the assets and liabilities.
The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs are obtained from independent sources and can be validated by a third party, whereas unobservable inputs reflect assumptions regarding what a third party would use in pricing an asset or liability based on the best information available under the circumstances. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
11
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Assets and liabilities measured at fair value as of September 30, 2026, were as follows:
| Fair value measurements | Total fair value | ||||||||||||||||||||||
| In millions | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | ||||||||||||||||||||
| Recurring fair value measurements | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investments | $ | $ | $ | $ | |||||||||||||||||||
| Total asset recurring fair value measurements | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Deferred compensation and other retirement plans | $ | $ | $ | $ | |||||||||||||||||||
| Total liability recurring fair value measurements | $ | $ | $ | $ | |||||||||||||||||||
| Financial instruments not carried at fair value | |||||||||||||||||||||||
| Total debt | $ | $ | $ | $ | |||||||||||||||||||
| Total financial instruments not carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
Assets and liabilities measured at fair value as of December 31, 2025, were as follows:
| Fair value measurements | Total fair value | ||||||||||||||||||||||
| In millions | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | ||||||||||||||||||||
| Recurring fair value measurements | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investments | $ | $ | $ | $ | |||||||||||||||||||
| Total asset recurring fair value measurements | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Deferred compensation and other retirement plans | $ | $ | $ | $ | |||||||||||||||||||
| Total liability recurring fair value measurements | $ | $ | $ | $ | |||||||||||||||||||
| Financial instruments not carried at fair value | |||||||||||||||||||||||
| Total debt | $ | $ | $ | $ | |||||||||||||||||||
| Total financial instruments not carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
The Company determines the fair value of its financial assets and liabilities using the following methodologies:
•Investments – These instruments include equity mutual funds and corporate bond funds. The fair value is obtained based on observable market prices quoted on public exchanges for similar instruments.
•Deferred compensation and other retirement plans – These include obligations related to deferred compensation and other retirement plans adjusted for market performance. The fair value is obtained based on observable market prices quoted on public exchanges for similar instruments.
•Debt – These instruments are recorded at cost and include the Revolving Facility and Senior Notes maturing through 2034. The fair value of these debt instruments is obtained based on observable market prices quoted on public exchanges for similar instruments.
The methodologies used by the Company to determine the fair value of its financial assets and liabilities as of September 30, 2026, are the same as those used as of December 31, 2025. The carrying values of Cash and cash equivalents, Accounts and notes receivable, net, Accounts payable and Accrued expenses and other current liabilities are a reasonable estimate of their fair value due to the short-term nature of these instruments.
The Company also had investments in debt and equity securities without readily determinable fair values of $130.6 million and $66.8 million as of September 30, 2026 and December 31, 2025, respectively, which are classified as Other noncurrent assets within the Condensed and Consolidated Balance Sheets. In the third quarter of 2026, the Company made an additional $40.0 million investment in Ambient.ai, an agentic physical security company.
12
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 12 - EQUITY
The changes in the components of Equity for the nine months ended September 30, 2026, were as follows:
| Allegion plc shareholders’ equity | |||||||||||||||||||||||||||||||||||||||||
| Ordinary shares | |||||||||||||||||||||||||||||||||||||||||
| In millions, except per share amounts | Total equity | Amount | Shares | Capital in excess of par value | Retained earnings | Accumulated other comprehensive loss | |||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||
| Repurchase of ordinary shares | ( | — | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | ( | ||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||
| Repurchase of ordinary shares | ( | — | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | ( | ||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||
| Repurchase of ordinary shares | ( | ( | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||
13
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
The changes in the components of Equity for the nine months ended September 30, 2025, were as follows:
| Allegion plc shareholders’ equity | |||||||||||||||||||||||||||||||||||||||||
| Ordinary shares | |||||||||||||||||||||||||||||||||||||||||
| In millions, except per share amounts | Total equity | Amount | Shares | Capital in excess of par value | Retained earnings | Accumulated other comprehensive loss | |||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive income, net | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Repurchase of ordinary shares | ( | — | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive income, net | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Repurchase of ordinary shares | ( | — | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | ( | ||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||
| Share-based compensation activity | — | — | — | ||||||||||||||||||||||||||||||||||||||
Dividends to ordinary shareholders ($ | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||
In April 2026, the Company’s Board of Directors (the “Board”) reauthorized the Company’s existing share repurchase program and, as a result, authorized the repurchase of up to, and including, $500.0 million of the Company’s ordinary shares (the “Share Repurchase Authorization”). During the nine months ended September 30, 2026, the Company repurchased $280.3 million of ordinary shares on the open market under the Share Repurchase Authorization.
14
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Accumulated Other Comprehensive Loss
The changes in Accumulated other comprehensive loss for the nine months ended September 30, 2026, were as follows:
| In millions | Cash flow hedges | Defined benefit items | Foreign currency items | Total | ||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
| Other comprehensive income (loss) before reclassifications | ( | ( | ||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive loss(a) | ||||||||||||||||||||||||||
| Settlements recognized | ||||||||||||||||||||||||||
| Tax expense | ( | ( | ( | |||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
The changes in Accumulated other comprehensive loss for the nine months ended September 30, 2025, were as follows:
| In millions | Cash flow hedges | Defined benefit items | Foreign currency items | Total | ||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
| Other comprehensive (loss) income before reclassifications | ( | ( | ||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive loss(a) | ( | |||||||||||||||||||||||||
| Tax benefit (expense) | ( | ( | ||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
(a) Amounts reclassified from Accumulated other comprehensive loss and recognized into Net earnings related to cash flow hedges are recorded in Cost of goods sold and Interest expense. Amounts reclassified from Accumulated other comprehensive loss and recognized into Net earnings related to defined benefit plan items are recorded in Other income, net.
NOTE 13 - SHARE-BASED COMPENSATION
The Company’s share-based compensation plans include programs for stock options, restricted stock units (“RSUs”) and performance stock units (“PSUs”). Share-based compensation expense is included in Cost of goods sold and Selling and administrative expenses within the Condensed and Consolidated Statements of Comprehensive Income. The following table summarizes the share-based compensation expense recognized for the three and nine months ended September 30:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Stock options | $ | $ | $ | $ | |||||||||||||||||||
| RSUs | |||||||||||||||||||||||
| PSUs | |||||||||||||||||||||||
| Pre-tax expense | |||||||||||||||||||||||
| Tax benefit | ( | ( | ( | ( | |||||||||||||||||||
| After-tax expense | $ | $ | $ | $ | |||||||||||||||||||
Stock Options / RSUs
Eligible participants may receive (i) stock options, (ii) RSUs or (iii) a combination of both stock options and RSUs. Grants issued during the nine months ended September 30 were as follows:
| 2026 | 2025 | ||||||||||||||||||||||
| Number granted | Weighted- average fair value per award | Number granted | Weighted- average fair value per award | ||||||||||||||||||||
| Stock options | $ | $ | |||||||||||||||||||||
| RSUs | $ | $ | |||||||||||||||||||||
15
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
The weighted-average fair value of the stock options granted is determined using the Black-Scholes option-pricing model. The following weighted-average assumptions were used during the nine months ended September 30:
| 2026 | 2025 | ||||||||||
| Dividend yield | % | % | |||||||||
| Volatility | % | % | |||||||||
| Risk-free rate of return | % | % | |||||||||
| Expected life (years) | |||||||||||
Volatility is based on the Company’s historic volatility. The risk-free rate of return is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the award is granted with a maturity equal to the expected term of the award. The expected life of the Company’s stock option awards is derived from historical data, based on the past exercise activity and post-vest cancellation activity of the Company’s stock option program and represents the period of time that awards are expected to be outstanding.
Performance Stock
During the nine months ended September 30, 2026, the Company granted PSUs with a maximum award level of approximately 0.1 million shares. In February 2024, 2025 and 2026, the Company’s Compensation and Human Capital Committee granted PSUs that were earned based 50% upon a performance condition, measured at each reporting period by earnings per share (“EPS”) performance in relation to pre-established targets for each performance period set by the Compensation and Human Capital Committee of the Board, and 50% upon a market condition, measured by the Company’s relative total shareholder return against a 50/50 blend of the S&P 400 Capital Goods Index and the S&P 500 Capital Goods Index over a three-year performance period. The fair values of the market condition are estimated using a Monte Carlo Simulation approach in a risk-neutral framework to model future stock price movements based upon historical volatility, risk-free rates of return and a correlation matrix.
NOTE 14 - RESTRUCTURING ACTIVITIES
During the nine months ended September 30, 2026, the Company recorded $13.8 million of expenses associated with restructuring activities, which are included within Cost of goods sold and Selling and administrative expenses within the Condensed and Consolidated Statements of Comprehensive Income. The Company anticipates additional future restructuring charges related to certain of the restructuring actions initiated during the nine months ended September 30, 2026. These restructuring activities primarily relate to workforce reductions intended to optimize and simplify operations and cost structure in the Allegion International and Allegion Americas segments.
The changes in the restructuring reserve during the nine months ended September 30, 2026, were as follows:
| In millions | Total | ||||
| December 31, 2025 | $ | ||||
| Additions, net of reversals | |||||
| Cash payments | ( | ||||
| September 30, 2026 | $ | ||||
The restructuring reserve is included in Accrued expenses and other current liabilities within the Condensed and Consolidated Balance Sheets. The majority of the costs accrued as of September 30, 2026, are expected to be paid within one year.
The Company also incurred, and expects to incur, other non-qualified restructuring charges related to these restructuring actions initiated, which represent costs that are directly attributable to restructuring activities but that do not fall into the severance, exit or disposal category. These costs were not material during the three and nine months ended September 30, 2026. Non-qualified restructuring charges are included within Cost of goods sold and Selling and administrative expenses within the Condensed and Consolidated Statements of Comprehensive Income. The majority of restructuring charges incurred over the remainder of 2026 will result in cash expenditures.
16
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 15 - OTHER INCOME, N ET
The components of Other income, net for the three and nine months ended September 30 were as follows:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Interest income | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Foreign currency exchange loss | |||||||||||||||||||||||
| Net periodic pension and postretirement benefit cost (income), less service cost | ( | ||||||||||||||||||||||
| Other | ( | ( | ( | ( | |||||||||||||||||||
| Other income, net | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
NOTE 16 - INCOME TAXES
The effective income tax rates for the three months ended September 30, 2026 and 2025, were 17.5 % and 9.8 %, respectively. The effective income tax rates for the nine months ended September 30, 2026 and 2025, were 18.5 % and 15.1 %, respectively. The increase in the effective income tax rate compared to 2025 is primarily due to favorable discrete charges in the prior year and the unfavorable mix of income earned in higher tax jurisdictions.
NOTE 17 - EARNINGS PER SHARE (“EPS”)
Basic EPS is calculated by dividing Net earnings by the weighted-average number of ordinary shares outstanding for the applicable period. Diluted EPS is calculated after adjusting the denominator of the basic EPS calculation for the effect of all potentially dilutive ordinary shares, which in the Company’s case includes shares issuable under share-based compensation plans.
The following table summarizes the weighted-average number of ordinary shares outstanding for basic and diluted EPS calculations for the three and nine months ended September 30:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Weighted-average number of basic shares | |||||||||||||||||||||||
| Shares issuable under share-based compensation plans | |||||||||||||||||||||||
| Weighted-average number of diluted shares | |||||||||||||||||||||||
At September 30, 2026 and 2025, 0.2 million shares issuable under share-based compensation plans were excluded from the computation of weighted-average diluted shares outstanding because the effect of including these shares would have been anti-dilutive.
NOTE 18 - NET REVENUES
The following tables show the Company’s Net revenues related to both tangible product sales and services and software for the three and nine months ended September 30, 2026 and 2025, respectively, disaggregated by business segment:
| Three months ended September 30, 2026 | Nine months ended September 30, 2026 | ||||||||||||||||||||||||||||||||||
| In millions | Allegion Americas | Allegion International | Total | Allegion Americas | Allegion International | Total | |||||||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||||||||||||
| Products | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Services and software | |||||||||||||||||||||||||||||||||||
| Total Net revenues | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
17
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| Three months ended September 30, 2025 | Nine months ended September 30, 2025 | ||||||||||||||||||||||||||||||||||
| In millions | Allegion Americas | Allegion International | Total | Allegion Americas | Allegion International | Total | |||||||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||||||||||||
| Products | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Services and software | |||||||||||||||||||||||||||||||||||
| Total Net revenues | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Net revenues are shown by tangible product sales and services and software, as contract terms, conditions and economic factors affecting the nature, amount, timing and uncertainty around revenue recognition and cash flows are substantially similar within each of these two principal revenue streams.
As of September 30, 2026 and December 31, 2025, contract assets related to the Company’s right to consideration for work completed but not billed were not material. The Company does not have any material costs to obtain or fulfill a contract that are capitalized on its Condensed and Consolidated Balance Sheets. During the three and nine months ended September 30, 2026 and 2025, no adjustments related to performance obligations satisfied in previous periods were recorded.
As of September 30, 2026 and December 31, 2025, contract liabilities related to revenues allocated to remaining performance obligations totaled $52.4 million and $41.2 million, respectively, and are classified as Accrued expenses and other current liabilities and Other noncurrent liabilities within the Condensed and Consolidated Balance Sheets. The Company’s total current contract liabilities related to revenues as of September 30, 2026 and December 31, 2025 totaled $44.8 million and $36.0 million, respectively, and the remainder was classified as noncurrent.
NOTE 19 - COMMITMENTS AND CONTINGENCIES
The Company is involved in various litigation, claims and administrative proceedings, including those related to environmental and product warranty matters, and the Company also has certain contractual obligations requiring minimum purchases. Amounts recorded for identified contingent liabilities are estimates, which are reviewed periodically and adjusted to reflect additional information when it becomes available. Subject to the uncertainties inherent in estimating future costs for contingent liabilities, except as expressly set forth in this note, management believes that any liability which may result from these legal matters would not have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.
Environmental Matters
As of September 30, 2026 and December 31, 2025, the Company had reserves for environmental matters of $19.5 million and $22.7 million, respectively. The total reserve at September 30, 2026 and December 31, 2025, included $8.0 million and $9.3 million, respectively, related to remediation of sites previously disposed by the Company. Environmental reserves are classified as Accrued expenses and other current liabilities or Other noncurrent liabilities within the Condensed and Consolidated Balance Sheets based on the timing of their expected future payment. The Company’s total current environmental reserve at September 30, 2026 and December 31, 2025, was $3.0 million and $6.0 million, respectively, and the remainder was classified as noncurrent. Expenses related to environmental remediation were not material during the nine months ended September 30, 2026 or 2025. Given the evolving nature of environmental laws, regulations and technology, the ultimate cost of future environmental remediation is uncertain.
Warranty Liability
The changes in the standard product warranty liability for the nine months ended September 30 were as follows:
| In millions | 2026 | 2025 | |||||||||
| Balance at beginning of period | $ | $ | |||||||||
| Reductions for payments | ( | ( | |||||||||
| Accruals for warranties issued during the current period | |||||||||||
| Acquisitions | |||||||||||
| Currency translation | ( | ||||||||||
| Balance at end of period | $ | $ | |||||||||
Standard product warranty liabilities are classified as either Accrued expenses and other current liabilities or Other noncurrent liabilities within the Condensed and Consolidated Balance Sheets based on the timing of the expected future payments.
18
ALLEGION PLC
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Contractual Obligations
As of September 30, 2026, the Company has arrangements with certain software and information technology service providers that require future minimum purchases of $61.8 million over the remainder of 2026 through 2030.
NOTE 20 - BUSINESS SEGMENT INFORMATION
The Company classifies its business into the following two reportable segments based on industry and market focus: Allegion Americas and Allegion International. The Company largely evaluates performance based on Segment operating income and Segment operating margins. The Company’s chief operating decision maker (the “CODM”) is its chief executive officer, who uses segment operating income as the measure of profit or loss to evaluate the financial performance of the business and as the basis for resource allocation, performance reviews and compensation. For these reasons, the Company believes that Segment operating income represents the most relevant measure of segment profit or loss. The Company’s CODM may exclude certain charges or gains, such as corporate charges and other special charges, from Operating income to arrive at a Segment operating income that is a more meaningful measure of profit or loss upon which to base operating decisions.
A summary of operations by reportable segment for the three and nine months ended September 30 was as follows:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Allegion Americas | |||||||||||||||||||||||
| Net revenues | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Selling and administrative expenses | |||||||||||||||||||||||
| Segment operating income | $ | $ | $ | $ | |||||||||||||||||||
Depreciation and amortization | $ | $ | $ | $ | |||||||||||||||||||
| Allegion International | |||||||||||||||||||||||
| Net revenues | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Selling and administrative expenses | |||||||||||||||||||||||
| Segment operating income | $ | $ | $ | $ | |||||||||||||||||||
| Depreciation and amortization | $ | $ | $ | $ | |||||||||||||||||||
| Reconciliation to earnings before income taxes | |||||||||||||||||||||||
| Segment operating income from reportable segments | $ | $ | $ | $ | |||||||||||||||||||
| Unallocated corporate expense | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Other income, net | ( | ( | ( | ( | |||||||||||||||||||
| Total earnings before income taxes | $ | $ | $ | $ | |||||||||||||||||||
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Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from the results discussed in the forward-looking statements. Factors that may cause a difference include, but are not limited to, those discussed under Part I, Item 1A – Risk Factors in the Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The following section is qualified in its entirety by the more detailed information, including our Condensed and Consolidated Financial Statements and the notes thereto, which appears elsewhere in this Quarterly Report.
Overview
Organization
Allegion plc and its consolidated subsidiaries (“Allegion,” “the Company,” “we,” “our,” or “us”) are a leading global provider of security products and solutions operating in two segments: Allegion Americas and Allegion International. We sell a wide range of security products and solutions for end-users in commercial, institutional and residential facilities worldwide, including the education, healthcare, government, hospitality, retail, commercial office and single and multi-family residential markets. Our leading brands include CISA®, Interflex®, LCN®, Schlage®, SimonsVoss® and Von Duprin®.
Recent Developments
Business and Industry Trends and Outlook
In the third quarter of 2026, we delivered high-single digit revenue growth compared to the same period in 2025, driven by favorable pricing, volume growth and the impact from recent acquisitions. Demand for electronic security products has also remained strong and continues to be a long-term growth driver.
Global Trade and Macroeconomic Environment
On February 20, 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were invalid, and in March 2026, the U.S. Court of International Trade further ruled that importers that paid such tariffs are due refunds. In the second quarter of 2026, U.S. Customs and Border Protection launched a system to process IEEPA tariff refund claims, and we formally submitted claims for qualifying IEEPA tariff refunds. For the nine months ended September 30, 2026, Operating income includes a $19.9 million benefit related to refunds received and expected to be received for these claims. The impact of future IEEPA tariff refunds is not expected to be material.
Following these rulings, new tariffs were imposed under other laws and on imports from more countries, in addition to existing non-IEEPA tariffs. Through the nine months ended September 30, 2026, we have offset inflation due to tariffs with pricing actions. We continue to monitor the evolving global tariff landscape, analyze the potential impact and assess what steps, including pricing actions, we may take to mitigate the impact. Existing or new tariffs could impact future demand. We estimate we source approximately 20-25% of cost of goods sold (“COGS”) from Mexico, less than 5% of COGS from China, and 5-10% of COGS from all other non-U.S. countries.
Acquisitions
DCI
On March 2, 2026, we, through our subsidiaries, acquired 100% of Door Components, Inc. (“DCI”), a manufacturer of custom, quick ship hollow metal doors and frames for industrial, commercial and institutional markets based in the United States. DCI is reported in the Company’s Allegion Americas segment. The purchase consideration, net of cash acquired, was approximately $69.3 million. This acquisition was accounted for as a business combination and was funded with available cash on hand and borrowings under the Revolving Facility.
Overly
On October 2, 2026, we, through our subsidiaries, acquired 100% of Overly Door Company (“Overly”), a manufacturer of custom and pre-engineered doors for acoustic, blast, bullet-resistant and vault security based in the United States. Overly will be reported in the Company’s Allegion Americas segment. The purchase consideration was approximately $88.7 million. This acquisition was funded with available cash on hand and borrowings under the Revolving Facility.
2026 Dividends and Share Repurchases
During the nine months ended September 30, 2026, we paid dividends of $1.65 per ordinary share to shareholders and repurchased approximately 1.9 million shares for $280.3 million.
20
Results of Operations – Three months ended September 30
| In millions, except per share amounts | 2026 | % of revenues | 2025 | % of revenues | |||||||||||||||||||
| Net revenues | $ | 1,172.6 | $ | 1,070.2 | |||||||||||||||||||
| Cost of goods sold | 624.4 | 53.2 | % | 580.4 | 54.3 | % | |||||||||||||||||
| Selling and administrative expenses | 263.6 | 22.5 | % | 256.0 | 23.9 | % | |||||||||||||||||
| Operating income | 284.6 | 24.3 | % | 233.8 | 21.8 | % | |||||||||||||||||
| Interest expense | 24.2 | 26.6 | |||||||||||||||||||||
| Other income, net | (7.4) | (1.7) | |||||||||||||||||||||
| Earnings before income taxes | 267.8 | 208.9 | |||||||||||||||||||||
| Provision for income taxes | 46.9 | 20.5 | |||||||||||||||||||||
| Net earnings | $ | 220.9 | $ | 188.4 | |||||||||||||||||||
| Diluted net earnings per ordinary share: | $ | 2.59 | $ | 2.18 | |||||||||||||||||||
The discussions that follow describe the significant factors contributing to the changes in our results of operations for the periods presented and form the basis used by management to evaluate the financial performance of the business.
Net Revenues
Net revenues for the three months ended September 30, 2026, increased by 9.6%, or $102.4 million, compared with the same period in 2025, due to the following:
| Pricing | 3.8 | % | |||
| Volume | 3.4 | % | |||
| Acquisitions / divestitures | 2.6 | % | |||
| Currency exchange rates | (0.2) | % | |||
| Total | 9.6 | % | |||
The increase in Net revenues was driven by improved pricing, higher volumes and the favorable impact from acquisitions, net of divestitures. These increases were partially offset by unfavorable foreign currency exchange rate movements.
Pricing includes increases or decreases of price, including discounts, surcharges and/or other sales deductions, on our existing products and services. Volume includes increases or decreases of revenue due to changes in unit volume of existing products and services, as well as new products and services.
Operating Income/Margin
Operating income for the three months ended September 30, 2026, increased $50.8 million compared to the same period in 2025. Operating margin, which we define as Operating income as a percentage of total Net revenues, for the three months ended September 30, 2026, increased to 24.3% from 21.8% for the same period in 2025, due to the following:
| In millions | Operating Income | Operating Margin | |||||||||
| September 30, 2025 | $ | 233.8 | 21.8 | % | |||||||
| Pricing and productivity in excess of inflation and investment spending | 17.3 | 0.7 | % | ||||||||
| Volume / product mix | 12.9 | 0.4 | % | ||||||||
| Currency exchange rates | (2.3) | (0.1) | % | ||||||||
| Acquisitions / divestitures | 4.6 | (0.1) | % | ||||||||
| Tariff refunds | 19.9 | 1.7 | % | ||||||||
| Acquisition / integration / restructuring expenses | (1.6) | (0.1) | % | ||||||||
| September 30, 2026 | $ | 284.6 | 24.3 | % | |||||||
The increase in Operating income was driven by the favorable impact of tariff refunds, pricing and productivity improvements in excess of inflation and investment spending, favorable volume/product mix and the favorable impact from acquisitions, net of divestitures. These increases were partially offset by unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency and higher acquisition, integration and restructuring expenses.
The increase in Operating margin was driven by the favorable impact of tariff refunds, pricing and productivity improvements in excess of inflation and investment spending and favorable volume/product mix. These increases were partially offset by
21
unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency, higher acquisition, integration and restructuring expenses and the unfavorable impact on Operating margin from acquisitions, net of divestitures.
Pricing and productivity in excess of inflation and investment spending includes the impact to both Operating income and Operating margin from pricing, as defined above, in addition to productivity, inflation and investment spending. Productivity represents improvements in unit costs of materials, cost reductions related to improvements to our manufacturing design and processes and reductions in selling and administrative expenses due to productivity projects. Inflation includes both unit costs for the current period compared to the average actual cost for the prior period, multiplied by current year volumes, and current period costs of ongoing selling and administrative functions compared to the same ongoing expenses in the prior period. Expenses related to increased head count for strategic initiatives, new facilities or other significant spending for strategic initiatives or new product and channel development, are captured in investment spending.
Volume/product mix represents the impact to both Operating income and Operating margin due to increases or decreases of revenue due to changes in unit volume, including new products and services, including the effect of changes in the mix of products and services sold on Cost of goods sold.
Interest Expense
Interest expense for the three months ended September 30, 2026, decreased $2.4 million compared with the same period in 2025, primarily due to a lower weighted-average interest rate on our outstanding indebtedness.
Other Income, net
The components of Other income, net for the three months ended September 30 were as follows:
| In millions | 2026 | 2025 | |||||||||
| Interest income | $ | (3.7) | $ | (2.5) | |||||||
| Foreign currency exchange loss | 0.6 | 1.2 | |||||||||
| Net periodic pension and postretirement benefit cost (income), less service cost | 0.3 | (0.1) | |||||||||
| Other income | (4.6) | (0.3) | |||||||||
| Other income, net | $ | (7.4) | $ | (1.7) | |||||||
Provision for Income Taxes
The effective income tax rates for the three months ended September 30, 2026 and 2025, were 17.5% and 9.8%, respectively. The increase in the effective income tax rate compared to 2025 is primarily due to favorable discrete charges in the prior year and the unfavorable mix of income earned in higher tax jurisdictions.
Results of Operations – Nine months ended September 30, 2026
| In millions, except per share amounts | 2026 | % of revenues | 2025 | % of revenues | |||||||||||||||||||
| Net revenues | $ | 3,357.7 | $ | 3,034.1 | |||||||||||||||||||
| Cost of goods sold | 1,837.5 | 54.7 | % | 1,655.3 | 54.6 | % | |||||||||||||||||
| Selling and administrative expenses | 785.6 | 23.4 | % | 728.9 | 24.0 | % | |||||||||||||||||
| Operating income | 734.6 | 21.9 | % | 649.9 | 21.4 | % | |||||||||||||||||
| Interest expense | 73.2 | 75.9 | |||||||||||||||||||||
| Other income, net | (5.8) | (10.5) | |||||||||||||||||||||
| Earnings before income taxes | 667.2 | 584.5 | |||||||||||||||||||||
| Provision for income taxes | 123.6 | 88.2 | |||||||||||||||||||||
| Net earnings | $ | 543.6 | $ | 496.3 | |||||||||||||||||||
| Diluted net earnings per ordinary share: | $ | 6.33 | $ | 5.73 | |||||||||||||||||||
The discussions that follow describe the significant factors contributing to the changes in our results of operations for the periods presented and form the basis used by management to evaluate the financial performance of the business.
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Net Revenues
Net revenues for the nine months ended September 30, 2026, increased by 10.7%, or $323.6 million, compared with the same period in 2025, due to the following:
| Pricing | 3.9 | % | |||
| Volume | 1.8 | % | |||
| Acquisitions / divestitures | 4.2 | % | |||
| Currency exchange rates | 0.8 | % | |||
| Total | 10.7 | % | |||
The increase in Net revenues was driven by improved pricing, higher volumes, the favorable impact from acquisitions, net of divestitures and favorable foreign currency exchange rate movements.
Operating Income/Margin
Operating income for the nine months ended September 30, 2026, increased $84.7 million compared to the same period in 2025. Operating margin, which we define as Operating income as a percentage of total Net revenues, for the nine months ended September 30, 2026, increased to 21.9% from 21.4% for the same period in 2025, due to the following:
| In millions | Operating Income | Operating Margin | |||||||||
| September 30, 2025 | $ | 649.9 | 21.4 | % | |||||||
| Pricing and productivity in excess of inflation and investment spending | 39.7 | 0.4 | % | ||||||||
| Volume / product mix | 16.9 | 0.2 | % | ||||||||
| Currency exchange rates | (2.5) | (0.2) | % | ||||||||
| Acquisitions / divestitures | 20.8 | (0.2) | % | ||||||||
| Tariff refunds | 19.9 | 0.6 | % | ||||||||
| Acquisition / integration / restructuring expenses | (10.1) | (0.3) | % | ||||||||
| September 30, 2026 | $ | 734.6 | 21.9 | % | |||||||
The increase in Operating income was driven by pricing and productivity improvements in excess of inflation and investment spending, the favorable impact from acquisitions/divestitures, the favorable impact of tariff refunds and favorable volume/product mix. These increases were partially offset by higher acquisition, integration and restructuring expenses and unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency.
The increase in Operating margin was driven by the favorable impact of tariff refunds, pricing and productivity improvements in excess of inflation and investment spending and favorable volume/product mix. These increases were partially offset by higher acquisition, integration and restructuring expenses, unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency and the unfavorable impact on Operating margin from acquisitions, net of divestitures.
Interest Expense
Interest expense for the nine months ended September 30, 2026, decreased $2.7 million compared with the same period in 2025, primarily due to a lower weighted-average interest rate on our outstanding indebtedness.
Other Income, net
The components of Other income, net for the nine months ended September 30 were as follows:
| In millions | 2026 | 2025 | |||||||||
| Interest income | $ | (6.6) | $ | (10.3) | |||||||
| Foreign currency exchange loss | 2.1 | 2.7 | |||||||||
| Net periodic pension and postretirement benefit cost, less service cost | 4.4 | — | |||||||||
| Other income | (5.7) | (2.9) | |||||||||
| Other income, net | $ | (5.8) | $ | (10.5) | |||||||
Net periodic pension and postretirement benefit cost, less service cost for the nine months ended September 30, 2026 includes a $3.7 million settlement charge related to a U.S. defined benefit pension plan.
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Provision for Income Taxes
The effective income tax rates for the nine months ended September 30, 2026 and 2025, were 18.5% and 15.1%, respectively. The increase in the effective income tax rate compared to 2025 is primarily due to favorable discrete charges in the prior year and the unfavorable mix of income earned in higher tax jurisdictions.
Review of Business Segments
We operate in and report financial results for two segments: Allegion Americas and Allegion International. These segments represent the level at which our chief operating decision maker reviews our financial performance and makes operating decisions.
Segment operating income is the measure of profit or loss that our chief operating decision maker uses to evaluate the financial performance of the business and as the basis for resource allocation, performance reviews and compensation. For these reasons, we believe that Segment operating income represents the most relevant measure of Segment profit or loss. Our chief operating decision maker may exclude certain charges or gains, such as corporate charges and other special charges, to arrive at a Segment operating income that is a more meaningful measure of profit or loss upon which to base our operating decisions. We define Segment operating margin as Segment operating income as a percentage of the segment’s Net revenues.
The segment discussions that follow describe the significant factors contributing to the changes in results for each segment included in Net earnings.
Segment Results of Operations - For the three and nine months ended September 30:
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| In millions | 2026 | 2025 | % Change | 2026 | 2025 | % Change | |||||||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||||||||||||
| Allegion Americas | $ | 942.4 | $ | 844.0 | 11.7 | % | $ | 2,670.9 | $ | 2,423.3 | 10.2 | % | |||||||||||||||||||||||
| Allegion International | 230.2 | 226.2 | 1.8 | % | 686.8 | 610.8 | 12.4 | % | |||||||||||||||||||||||||||
| Total | $ | 1,172.6 | $ | 1,070.2 | $ | 3,357.7 | $ | 3,034.1 | |||||||||||||||||||||||||||
| Segment operating income | |||||||||||||||||||||||||||||||||||
| Allegion Americas | $ | 294.6 | $ | 242.4 | 21.5 | % | $ | 776.5 | $ | 690.4 | 12.5 | % | |||||||||||||||||||||||
| Allegion International | 17.2 | 19.7 | (12.7) | % | 40.3 | 47.1 | (14.4) | % | |||||||||||||||||||||||||||
| Total | $ | 311.8 | $ | 262.1 | $ | 816.8 | $ | 737.5 | |||||||||||||||||||||||||||
| Segment operating margin | |||||||||||||||||||||||||||||||||||
| Allegion Americas | 31.3 | % | 28.7 | % | 29.1 | % | 28.5 | % | |||||||||||||||||||||||||||
| Allegion International | 7.5 | % | 8.7 | % | 5.9 | % | 7.7 | % | |||||||||||||||||||||||||||
Allegion Americas
Our Allegion Americas segment is a leading provider of security products, services and solutions throughout North America. The segment sells a broad range of products and solutions including locks, locksets, key systems, door controls and door control systems, exit devices, doors, glass and door systems, accessories, electronic security products, access control systems and software and service solutions to customers in institutional, commercial and residential facilities, including the education, healthcare, government, hospitality, retail, commercial office and single and multi-family residential markets. This segment’s primary brands are LCN, Schlage, Von Duprin and Stanley Access Technologies, which we utilize with permission in accordance with the terms of an agreement with STANLEY Black & Decker (“STANLEY” is the property of Stanley Logistics L.L.C.).
Net Revenues
Net revenues for the three months ended September 30, 2026, increased by 11.7%, or $98.4 million, compared to the same period in 2025, due to the following:
| Pricing | 4.5 | % | ||||||
| Volume | 4.6 | % | ||||||
| Acquisitions | 2.6 | % | ||||||
| Total | 11.7 | % | ||||||
The increase in Net revenues was driven by higher volumes, improved pricing and the favorable impact of acquisitions.
24
Net revenues from non-residential products for the three months ended September 30, 2026, increased by a low-teens percent compared to the same period in the prior year. These increases were driven by higher volumes, improved pricing and revenue from acquisitions. Net revenues from residential products for the three months ended September 30, 2026, increased by a mid-single digits percent compared to the same period in the prior year. These increases were primarily driven by improved pricing and revenue from acquisitions.
Growth in electronic security products and solutions is a metric that is actively monitored by management and a focus of our investors. Electronic products encompass both residential and non-residential solutions and include all electrified product categories including, but not limited to, electronic and electrified locks, access control systems and electronic and electrified door controls and systems and exit devices. For the three months ended September 30, 2026, Net revenues from the sale of electronic products increased by a low-double digit percent compared to the same period in the prior year. We expect continued growth in our electronic products in 2026.
Net revenues for the nine months ended September 30, 2026, increased by 10.2%, or $247.6 million, compared to the same period in 2025, due to the following:
| Pricing | 4.6 | % | ||||||
| Volume | 3.0 | % | ||||||
| Acquisitions | 2.6 | % | ||||||
| Total | 10.2 | % | ||||||
The increase in Net revenues was driven by improved pricing, higher volumes and the favorable impact of acquisitions.
Net revenues from non-residential products for the nine months ended September 30, 2026, increased by a low-double digits percent compared to the same period in the prior year. These increases were driven by improved pricing, higher volumes, revenue from acquisitions, and favorable foreign currency exchange rate movements. Net revenues from residential products for the nine months ended September 30, 2026, increased by a mid-single digit percent compared to the same period in the prior year. These increases were primarily driven by improved pricing, higher volumes and revenue from acquisitions.
Net revenues from the sale of electronic products for the nine months ended September 30, 2026, increased by a high-single digits percent compared to the same period in the prior year. We expect continued growth in our electronic products in 2026.
Operating income/margin
Segment operating income for the three months ended September 30, 2026, increased $52.2 million compared to the same period in 2025, and Segment operating margin for the three months ended September 30, 2026, increased to 31.3% from 28.7%, due to the following:
| In millions | Operating Income | Operating Margin | ||||||||||||
| September 30, 2025 | $ | 242.4 | 28.7 | % | ||||||||||
| Pricing and productivity in excess of inflation and investment spending | 15.3 | 0.5 | % | |||||||||||
| Volume / product mix | 15.4 | 0.4 | % | |||||||||||
| Currency exchange rates | (2.2) | (0.2) | % | |||||||||||
| Acquisitions | 3.3 | (0.3) | % | |||||||||||
| Tariff refunds | 19.9 | 2.1 | % | |||||||||||
| Acquisition / integration / restructuring expenses | 0.5 | 0.1 | % | |||||||||||
| September 30, 2026 | $ | 294.6 | 31.3 | % | ||||||||||
The increase in Segment operating income was driven by the favorable impact of tariff refunds, favorable volume/product mix, pricing and productivity in excess of inflation and investment spending, the favorable impact of recent acquisitions and lower acquisition, integration and restructuring expenses. These increases were partially offset by unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency.
The increase in Segment operating margin was driven by the favorable impact of tariff refunds, pricing and productivity improvements in excess of inflation and investment spending, favorable volume/product mix and lower acquisition, integration and restructuring expenses. These increases were partially offset by the unfavorable impact on operating margin from recent acquisitions and unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency.
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Segment operating income for the nine months ended September 30, 2026, increased $86.1 million compared to the same period in 2025, and Segment operating margin for the nine months ended September 30, 2026, increased to 29.1% from 28.5%, due to the following:
| In millions | Operating Income | Operating Margin | ||||||||||||
| September 30, 2025 | $ | 690.4 | 28.5 | % | ||||||||||
| Pricing and productivity in excess of inflation and investment spending | 41.3 | 0.4 | % | |||||||||||
| Volume / product mix | 26.3 | 0.2 | % | |||||||||||
| Currency exchange rates | (6.3) | (0.2) | % | |||||||||||
| Acquisitions | 7.7 | (0.4) | % | |||||||||||
| Tariff Refunds | 19.9 | 0.7 | % | |||||||||||
| Acquisition / integration / restructuring expenses | (2.8) | (0.1) | % | |||||||||||
| September 30, 2026 | $ | 776.5 | 29.1 | % | ||||||||||
The increase in Segment operating income was driven by pricing and productivity in excess of inflation and investment spending, favorable volume/product mix, the favorable impact of tariff refunds and the favorable impact of recent acquisitions. These increases were partially offset by unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency and higher acquisition, integration, and restructuring expenses.
The increase in Segment operating margin was driven by the favorable impact of tariff refunds, pricing and productivity improvements in excess of inflation and investment spending and favorable volume/product mix. These increases were partially offset by the unfavorable impact on operating margin from recent acquisitions, unfavorable foreign currency exchange rate movements, inclusive of transactional foreign currency and higher acquisition, integration, and restructuring expenses.
Allegion International
Our Allegion International segment provides security products, services and solutions primarily throughout Europe, Asia and Oceania. The segment offers end-users a broad range of products, services and solutions including locks, locksets, portable locks, key systems, door controls and door control systems, exit devices, doors, electronic security products, access control systems, time and attendance and workforce productivity solutions, among other software and service solutions. This segment’s primary brands are AXA, CISA, ELATEC, Gainsborough, Interflex and SimonsVoss.
Net Revenues
Net revenues for the three months ended September 30, 2026, increased by 1.8%, or $4.0 million, compared to the same period in 2025, due to the following:
| Pricing | 1.3 | % | ||||||
| Volume | (1.5) | % | ||||||
| Acquisitions / divestitures | 2.5 | % | ||||||
| Currency exchange rates | (0.5) | % | ||||||
| Total | 1.8 | % | ||||||
The increase in Net revenues was driven by the favorable impact from acquisitions, net of divestitures, and improved pricing. These increases were partially offset by lower volumes primarily due to market conditions in Western Europe and unfavorable foreign currency exchange rate movements.
Net revenues for the nine months ended September 30, 2026, increased by 12.4%, or $76.0 million, compared to the same period in 2025, due to the following:
| Pricing | 1.1 | % | ||||||
| Volume | (3.2) | % | ||||||
| Acquisitions / divestitures | 10.5 | % | ||||||
| Currency exchange rates | 4.0 | % | ||||||
| Total | 12.4 | % | ||||||
The increase in Net revenues was driven by the favorable impact from acquisitions, net of divestitures, favorable foreign currency exchange rate movements and improved pricing. These increases were partially offset by lower volumes primarily due to market conditions in Western Europe.
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Operating income/margin
Segment operating income for the three months ended September 30, 2026, decreased $2.5 million compared to the same period in 2025, and Segment operating margin for the three months ended September 30, 2026, decreased to 7.5% from 8.7%, due to the following:
| In millions | Operating Income | Operating Margin | ||||||||||||
| September 30, 2025 | $ | 19.7 | 8.7 | % | ||||||||||
| Pricing and productivity in excess of inflation and investment spending | 1.0 | 0.3 | % | |||||||||||
| Volume / product mix | (2.6) | (1.0) | % | |||||||||||
| Currency exchange rates | (0.1) | — | % | |||||||||||
| Acquisitions / divestitures | 1.3 | 0.4 | % | |||||||||||
| Acquisition / integration / restructuring expenses | (2.1) | (0.9) | % | |||||||||||
| September 30, 2026 | $ | 17.2 | 7.5 | % | ||||||||||
The decrease in Segment operating income and Segment operating margin was driven by unfavorable volume/product mix, higher acquisition, integration and restructuring expenses and the unfavorable impact from foreign currency exchange rate movements. These decreases were partially offset by the favorable impact from recent acquisitions/divestitures and pricing and productivity in excess of inflation and investment spending.
Segment operating income for the nine months ended September 30, 2026, decreased $6.8 million compared to the same period in 2025, and Segment operating margin for the nine months ended September 30, 2026, decreased to 5.9% from 7.7%, due to the following:
| In millions | Operating Income | Operating Margin | ||||||||||||
| September 30, 2025 | $ | 47.1 | 7.7 | % | ||||||||||
| Inflation and investment spending in excess of pricing and productivity | (6.0) | (1.0) | % | |||||||||||
| Volume / product mix | (9.5) | (1.1) | % | |||||||||||
| Currency exchange rates | 3.8 | 0.3 | % | |||||||||||
| Acquisitions / divestitures | 13.1 | 1.2 | % | |||||||||||
| Acquisition / integration / restructuring expenses | (8.2) | (1.2) | % | |||||||||||
| September 30, 2026 | $ | 40.3 | 5.9 | % | ||||||||||
The decrease in Segment operating income and Segment operating margin was driven by the unfavorable impact from volume/product mix, higher acquisition, integration and restructuring expenses and inflation and investment spending in excess of pricing and productivity. These decreases were partially offset by the favorable impact from recent acquisitions/divestitures and the favorable impact from foreign currency exchange rate movements.
Liquidity and Capital Resources
Liquidity Outlook, Sources and Uses
Our primary source of liquidity is cash provided by operating activities. Cash provided by operating activities is used to invest in new product development and fund capital expenditures and working capital requirements. Our ability to generate cash from operating activities, our unused borrowing capacity under an unsecured revolving credit facility (the “Revolving Facility”) and our access to the capital and credit markets enable us to fund these capital needs, execute our long-term growth strategies and return value to our shareholders. Further, our business operates with strong operating cash flows, low leverage and low capital intensity, providing financial flexibility.
Our short-term financing needs primarily consist of working capital requirements, restructuring initiatives, capital spending, dividend payments and principal and interest payments on our long-term debt. Long-term financing needs depend largely on potential growth opportunities, including potential acquisitions, repayment or refinancing of our long-term obligations and repurchases of our ordinary shares. Of our total outstanding indebtedness as of September 30, 2026, approximately 88% incurs fixed-rate interest and is therefore not exposed to the risk of rising variable interest rates.
Based upon our operations, existing cash balances and unused borrowing capacity under the Revolving Facility, as of September 30, 2026, we expect our cash flows from operations will be sufficient to maintain a sound financial position and liquidity and to meet our current financing needs for at least the next 12 months. Further, we do not anticipate any covenant compliance challenges with any of our outstanding indebtedness for at least the next 12 months.
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The following table reflects the major categories of cash flows for the nine months ended September 30. For additional details, see the Condensed and Consolidated Statements of Cash Flows in the Condensed and Consolidated Financial Statements.
| In millions | 2026 | 2025 | |||||||||
| Net cash provided by operating activities | $ | 604.0 | $ | 543.7 | |||||||
| Net cash used in investing activities | (178.2) | (649.3) | |||||||||
| Net cash used in financing activities | (388.0) | (115.2) | |||||||||
Operating Activities: Net cash provided by operating activities during the nine months ended September 30, 2026, increased $60.3 million compared to the same period in 2025, primarily due to higher net earnings.
Investing Activities: Net cash used in investing activities during the nine months ended September 30, 2026, decreased $471.1 million compared to the same period in 2025, primarily due to lower cash used for acquisitions. Net cash used in investing activities for the nine months ended September 30, 2026 includes a $40.0 million investment in Ambient.ai, an agentic physical security company.
Financing Activities: Net cash used in financing activities during the nine months ended September 30, 2026, increased $272.8 million compared to the same period in 2025, primarily due to higher repurchases of ordinary shares and lower net proceeds from debt.
Capitalization
Long-term debt and other borrowings consisted of the following:
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Revolving Facility | $ | 240.9 | $ | 190.6 | |||||||
| 3.550% Senior Notes due 2027 | 400.0 | 400.0 | |||||||||
| 3.500% Senior Notes due 2029 | 400.0 | 400.0 | |||||||||
| 5.411% Senior Notes due 2032 | 600.0 | 600.0 | |||||||||
| 5.600% Senior Notes due 2034 | 400.0 | 400.0 | |||||||||
| Other debt | 0.3 | 0.2 | |||||||||
| Total borrowings outstanding | 2,041.2 | 1,990.8 | |||||||||
| Discounts and debt issuance costs, net | (9.2) | (10.7) | |||||||||
| Total debt | 2,032.0 | 1,980.1 | |||||||||
| Less current portion of long-term debt | 0.3 | 0.2 | |||||||||
| Total long-term debt | $ | 2,031.7 | $ | 1,979.9 | |||||||
The Revolving Facility matures on May 20, 2030 and provides aggregate commitments of up to $1.0 billion, which includes up to $100.0 million for the issuance of letters of credit. As of September 30, 2026, we had outstanding borrowings of $240.9 million and letters of credit of $25.3 million. On October 1, 2026, the Company borrowed an additional $40.0 million on the Revolving Facility which was used for the acquisition of Overly.
Borrowings under the Revolving Facility are due upon its maturity but may be repaid at any time without premium or penalty, and amounts repaid may be reborrowed. We pay certain fees with respect to the Revolving Facility, including an unused commitment fee on the undrawn portion of between 0.080% and 0.200% per year, depending on our credit ratings, as well as certain other fees.
Outstanding borrowings under the Revolving Facility accrue interest, at our option, equal to either: (i) a Secured Overnight Financing Rate (“SOFR”) plus an applicable margin or (ii) a base rate plus the applicable margin. The applicable margin ranges from 0.875% to 1.375% depending on our credit ratings. At September 30, 2026, our outstanding borrowings under the Revolving Facility accrued interest at SOFR plus a margin of 1.125%, resulting in an interest rate of 4.939%. The Revolving Facility also contains negative and affirmative covenants and events of default that, among other things, limit or restrict our ability to enter into certain transactions. In addition, the Revolving Facility requires us to comply with a maximum leverage ratio as defined in the credit agreement. As of September 30, 2026, we were in compliance with all applicable covenants under the credit agreement.
As of September 30, 2026, we also have $400.0 million outstanding of 3.550% Senior Notes due 2027 (the “3.550% Senior Notes”), $600.0 million outstanding of 5.411% Senior Notes due 2032 (the “5.411% Senior Notes”), $400.0 million outstanding of 5.600% Senior Notes due 2034 (the “5.600% Senior Notes”), and $400.0 million outstanding of 3.500% Senior Notes due 2029 (the “3.500% Senior Notes,” and all four senior notes collectively, the “Senior Notes”). The 3.550% Senior Notes and
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3.500% Senior Notes both require semi-annual interest payments on April 1 and October 1 of each year and mature on October 1, 2027 and October 1, 2029, respectively. The 5.411% Senior Notes require semi-annual interest payments on January 1 and July 1 of each year and mature on July 1, 2032. The 5.600% Senior Notes require semi-annual interest payments on May 29 and November 29 of each year and mature on May 29, 2034.
Historically, the majority of our earnings were considered to be permanently reinvested in jurisdictions where we have made, and intend to continue to make, substantial investments to support the ongoing development and growth of our global operations. At September 30, 2026, we analyzed our working capital requirements and the potential tax liabilities that would be incurred if certain subsidiaries made distributions and concluded that no material changes to our historic permanent reinvestment assertions are required.
Defined Benefit Plans
Our investment objective in managing defined benefit plan assets is to ensure that all present and future benefit obligations are met as they come due. We seek to achieve this goal while trying to mitigate volatility in plan funded status, contributions and expense by better matching the characteristics of the plan assets to that of the plan liabilities. Global asset allocation decisions are based on a dynamic approach whereby a plan’s allocation to fixed income assets increases as the funded status increases. We monitor plan funded status, asset allocation and the impact of market conditions on our defined benefit plans regularly in addition to investment manager performance. For further details on pension plan activity, see Note 10 to the Condensed and Consolidated Financial Statements.
For a further discussion of Liquidity and Capital Resources, refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contained in our Annual Report on Form 10-K for the year ended December 31, 2025.
Guarantor Financial Information
Allegion US Hold Co is or was, as applicable, the issuer of the 3.550% Senior Notes, 5.411% Senior Notes, and 5.600% Senior Notes and is the guarantor of the 3.500% Senior Notes. Allegion plc (the “Parent”) is or was, as applicable, the issuer of the 3.500% Senior Notes and is or was, as applicable, the guarantor of the 3.550% Senior Notes, 5.411% Senior Notes, and 5.600% Senior Notes. Allegion US Hold Co is directly or indirectly 100% owned by the Parent and each of the guarantees of Allegion US Hold Co and the Parent is full and unconditional and joint and several.
The 3.550% Senior Notes, 5.411% Senior Notes, and 5.600% Senior Notes are or were, as applicable, senior unsecured obligations of Allegion US Hold Co and rank equally with all of Allegion US Hold Co’s existing and future senior unsecured and unsubordinated indebtedness. The guarantee of the 3.550% Senior Notes, 5.411% Senior Notes, and 5.600% Senior Notes is or was, as applicable, the senior unsecured obligation of the Parent and ranks equally with all of the Parent’s existing and future senior unsecured and unsubordinated indebtedness. The 3.500% Senior Notes are senior unsecured obligations of the Parent and rank equally with all of the Parent’s existing and future senior unsecured and unsubordinated indebtedness. The guarantee of the 3.500% Senior Notes is the senior unsecured obligation of Allegion US Hold Co and ranks equally with all of Allegion US Hold Co’s existing and future senior unsecured and unsubordinated indebtedness.
Each guarantee is effectively subordinated to any secured indebtedness of the guarantor to the extent of the value of the assets securing such indebtedness. The Senior Notes are structurally subordinated to indebtedness and other liabilities of the subsidiaries of the guarantor, none of which guarantee the notes. The obligations of the guarantor under its guarantee are limited as necessary to prevent such guarantee from constituting a fraudulent conveyance under applicable law and, therefore, are limited to the amount that the applicable guarantor could guarantee without such guarantee constituting a fraudulent conveyance; this limitation, however, may not be effective to prevent such guarantee from constituting a fraudulent conveyance. If the guarantee was rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees and other contingent liabilities) of the applicable guarantor, and, depending on the amount of such indebtedness, the applicable guarantor’s liability on its guarantee could be reduced to zero. In such an event, the notes would be structurally subordinated to the indebtedness and other liabilities of the guarantor.
For further details, terms and conditions of the Senior Notes refer to the Company’s Forms 8-K filed October 2, 2017, September 27, 2019, June 22, 2022, and May 29, 2024.
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The following tables present the summarized financial information specified in Rule 1-02(bb)(1) of Regulation S-X for each issuer and guarantor. The summarized financial information has been prepared in accordance with Rule 13-01 of Regulation S-X.
Selected Condensed Statement of Comprehensive Income Information
| Nine months ended September 30, 2026 | Year ended December 31, 2025 | ||||||||||||||||||||||
| In millions | Allegion plc | Allegion US Hold Co | Allegion plc | Allegion US Hold Co | |||||||||||||||||||
| Net revenues | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
| Gross profit | — | — | — | — | |||||||||||||||||||
| Operating loss | (5.2) | (0.1) | (7.6) | — | |||||||||||||||||||
| Equity earnings in affiliates, net of tax | 585.9 | 411.1 | 711.5 | 483.4 | |||||||||||||||||||
Transactions with related parties and subsidiaries(a) | (14.9) | (66.9) | (27.4) | (92.1) | |||||||||||||||||||
| Net earnings | 543.6 | 321.3 | 643.8 | 362.0 | |||||||||||||||||||
(a) Transactions with related parties and subsidiaries include intercompany interest and fees.
Selected Condensed Balance Sheet Information
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||
| In millions | Allegion plc | Allegion US Hold Co | Allegion plc | Allegion US Hold Co | |||||||||||||||||||
| Current assets: | |||||||||||||||||||||||
| Amounts due from related parties and subsidiaries | $ | 0.5 | $ | 802.2 | $ | 1.2 | $ | 781.3 | |||||||||||||||
| Total current assets | 11.2 | 852.1 | 8.2 | 835.2 | |||||||||||||||||||
| Noncurrent assets: | |||||||||||||||||||||||
| Amounts due from related parties and subsidiaries | — | 1,297.1 | — | 1,299.1 | |||||||||||||||||||
| Total noncurrent assets | 1,792.4 | 1,429.8 | 1,792.7 | 1,425.7 | |||||||||||||||||||
| Current liabilities: | |||||||||||||||||||||||
| Amounts due to related parties and subsidiaries | $ | 371.9 | $ | 1,076.3 | $ | 10.8 | $ | 702.1 | |||||||||||||||
| Total current liabilities | 394.5 | 1,112.1 | 31.7 | 730.4 | |||||||||||||||||||
| Noncurrent liabilities: | |||||||||||||||||||||||
| Amounts due to related parties and subsidiaries | 278.7 | 2,324.6 | 484.0 | 2,737.6 | |||||||||||||||||||
| Total noncurrent liabilities | 868.3 | 3,749.6 | 1,073.0 | 4,124.4 | |||||||||||||||||||
Critical Accounting Policies
Management’s Discussion and Analysis of Financial Condition and Results of Operations are based upon our Condensed and Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of financial statements in conformity with those accounting principles requires management to use judgments in making estimates and assumptions based on the relevant information available at the end of each period. These estimates and assumptions have a significant effect on reported amounts of assets and liabilities, revenue and expenses, as well as the disclosure of contingent assets and liabilities because they result primarily from the need to make estimates and assumptions on matters that are inherently uncertain. Actual results may differ from estimates.
Management believes there have been no significant changes during the nine months ended September 30, 2026, to the items we disclosed as our critical accounting policies in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025.
Recent Accounting Pronouncements
Refer to Note 2 in our Condensed and Consolidated Financial Statements for a discussion of recently issued accounting pronouncements.
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Forward-Looking Statements
Certain statements in this report, other than purely historical information, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements generally are identified by the words “believe,” “aim,” “projected,” “expect,” “anticipate,” “estimate,” “forecast,” “outlook,” “intend,” “scheduled,” “targets,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” or the negative thereof or variations thereon or similar expressions generally intended to identify forward-looking statements.
These statements are based on currently available information and our current assumptions, expectations and projections about future events. While we believe that our assumptions, expectations and projections are reasonable in view of the currently available information, you are cautioned not to place undue reliance on our forward-looking statements. Forward-looking statements speak only as of the date they are made and are not guarantees of future performance. They are subject to future events, risks and uncertainties – many of which are beyond our control – as well as potentially inaccurate assumptions, that could cause actual results to differ materially from our expectations and projections including, among other things:
•ongoing macroeconomic challenges and continued economic instability;
•increased prices and inflation;
•volatility and uncertainty in the political, economic and regulatory environments in which we operate, including changes to trade agreements, sanctions, import and export regulations, custom duties and applicable tax regulations and interpretations, social and political unrest, instability, national and international conflict, terrorist acts and other geographical disputes and uncertainties;
•the strength and stability of the institutional, commercial and residential construction and remodeling markets;
•fluctuations in currency exchange rates;
•potential impairment of our goodwill, indefinite-lived intangible assets and/or our long-lived assets;
•instability in the U.S. and global capital and credit markets;
•our ability to make scheduled debt payments or to refinance our debt obligations;
•increased competition, including from technological developments;
•the development, commercialization and acceptance of new products and services;
•changes in customer and consumer preferences and our ability to maintain beneficial relationships with large customers;
•our products or solutions failing to meet certification and specification requirements, being defective, causing property damage, bodily harm or injury, or otherwise falling short of customers’ needs and expectations;
•our ability to identify and successfully complete and integrate acquisitions, including achieving their anticipated strategic and financial benefits;
•business opportunities that diverge from our core business;
•our ability to achieve the expected improvements or financial returns we expect from our strategic initiatives;
•our ability to effectively manage and implement restructuring initiatives or other organizational changes;
•global climate change or other unexpected events, including global health crises, such as epidemics, pandemics or similar widespread public health concerns;
•the proper functioning of our information technology and operational technology systems, including disruption or breaches of our information systems, such as cybersecurity attacks;
•the failure of our third-party vendors to provide effective support for many of the critical elements of our global information and operational technology infrastructure;
•our ability to recruit and retain a highly qualified and diverse workforce;
•disruptions in our global supply chain, including product manufacturing and logistical services provided by our supplier partners;
•our ability to effectively manage real or perceived issues related to product quality, safety, corporate social responsibility and other reputational matters;
•our ability to protect our brand reputation and trademarks;
•legal judgments, fines, penalties or settlements imposed against us or our assets as a result of legal proceedings, claims and disputes;
•claims of infringement of intellectual property rights by third parties;
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•improper conduct by any of our employees, agents or business partners;
•changes to, or changes in interpretations of, current laws and regulations;
•uncertainty and inherent subjectivity related to transfer pricing regulations in the countries in which we operate;
•changes in tax rates, the adoption of new tax legislation or exposure to additional tax liabilities; and
•risks related to our incorporation in Ireland, including the possible effects on us of future legislation or adverse determinations by taxing authorities that could increase our tax burden.
These events, risks and uncertainties are described more fully in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. There may also be other factors that have not been anticipated or that are not described in our periodic filings with the SEC, generally because we did not believe them to be significant at the time, which could cause actual results to differ materially from our projections and expectations. We do not undertake to update any forward-looking statements, except as required by applicable law.
Item 3 – Quantitative and Qualitative Disclosures about Market Risk
There have been no material changes in our exposure to market risk during the third quarter of 2026. For a discussion of the Company’s exposure to market risk, refer to Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Item 4 – Controls and Procedures
The Company’s management, including its Chief Executive Officer and Chief Financial Officer, have conducted an evaluation of the effectiveness of disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded as of September 30, 2026, that the disclosure controls and procedures are effective in ensuring that all material information required to be filed in this Quarterly Report on Form 10-Q has been recorded, processed, summarized and reported when required and the information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
There have not been any changes in the Company’s internal control over financial reporting that occurred during the third quarter of 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II – OTHER INFORMATION
Item 1 – Legal Proceedings
In the normal course of business, we are involved in a variety of lawsuits, claims and legal proceedings, including commercial and contract disputes, labor and employment matters, product liability claims, environmental liabilities, antitrust and trade regulation matters, intellectual property disputes and tax-related matters. In our opinion, pending legal matters are not expected to have a material adverse impact on our results of operations, financial condition, liquidity or cash flows.
Item 1A – Risk Factors
There have been no material changes to our risk factors contained in our Annual Report on Form 10-K for the year ended December 31, 2025. For a further discussion of our Risk Factors, refer to the “Risk Factors” discussion contained in our Annual Report on Form 10-K for the year ended December 31, 2025.
Item 2 – Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities
Issuer Purchases of Equity Securities
| Period | Total number of shares purchased (000s) | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs (000s) | Approximate dollar value of shares that may yet be purchased under the plans or programs (000s)(a) | ||||||||||||||||||||||
| July 1 - July 31 | 66 | $ | 157.95 | 66 | $ | 369,593 | ||||||||||||||||||||
| August 1 - August 31 | 334 | 163.34 | 334 | 315,000 | ||||||||||||||||||||||
| September 1 - September 30 | 355 | 154.13 | 355 | 260,270 | ||||||||||||||||||||||
| Total | 755 | $ | 158.54 | 755 | $ | 260,270 | ||||||||||||||||||||
(a) On April 15, 2026, the Board reauthorized the Company’s existing share repurchase program and, as a result, authorized the repurchase of a total amount of up to, and including, $500.0 million of the Company’s ordinary shares under the program. The share repurchase program does not have a prescribed expiration date. Share repurchases may be made from time-to-time in open market, accelerated stock repurchase or privately negotiated transactions, including pursuant to one or more Rule 10b5-1 trading plans. The timing and manner of any share repurchase and the actual number of ordinary shares repurchased will be determined at the discretion of management based on a variety of factors, including, among others, the Company’s stock price, corporate and regulatory requirements, and other general market and economic conditions.
Item 5 – Other Information
During the three months ended September 30, 2026, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in item 408(a) of Regulation S-K.
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Item 6 – Exhibits
(a) Exhibits
| Exhibit No. | Description | Method of Filing | ||||||||||||
| Amended and Restated Memorandum and Articles of Association of Allegion plc. | Incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed with the SEC on June 13, 2016 (File No. 001-35971). | |||||||||||||
| Subsidiary Guarantors and Issuers of Guaranteed Securities. | Filed herewith. | |||||||||||||
| Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | Filed herewith. | |||||||||||||
| Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | Filed herewith. | |||||||||||||
| Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | Filed herewith. | |||||||||||||
| 101.INS | XBRL Instance Document. | The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||||||||||||
| 101.SCH | XBRL Taxonomy Extension Schema Document. | Filed herewith. | ||||||||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | Filed herewith. | ||||||||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | Filed herewith. | ||||||||||||
| 101.LAB | XBRL Taxonomy Extension Labels Linkbase Document. | Filed herewith. | ||||||||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. | Filed herewith. | ||||||||||||
| 104 | Cover Page Interactive Data File. | Formatted as Inline XBRL and contained in Exhibit 101. | ||||||||||||
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ALLEGION PLC
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
ALLEGION PLC (Registrant) | ||||||||
| Date: | October 22, 2026 | /s/ Michael J. Wagnes | ||||||
| Michael J. Wagnes, Senior Vice President and Chief Financial Officer Principal Financial Officer | ||||||||
| Date: | October 22, 2026 | /s/ Nickolas A. Musial | ||||||
| Nickolas A. Musial, Vice President, Controller, Chief Accounting Officer and Treasurer Principal Accounting Officer | ||||||||
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Exhibit 22
Subsidiary Guarantors and Issuers of Guaranteed Securities
The table below sets forth the guarantor of the 3.500% Senior Notes due 2029 issued by Allegion plc and the jurisdiction of incorporation or organization of such entity.
| Name of Guarantor | Jurisdiction of Incorporation or Organization | |||||||
| Allegion US Holding Company Inc. | Delaware | |||||||
The table below sets forth the guarantor of the 3.550% Senior Notes due 2027, 5.411% Senior Notes due 2032, and 5.600% Senior Notes due 2034 issued by Allegion US Holding Company Inc., a wholly-owned subsidiary of Allegion plc, and the jurisdiction of incorporation or organization of such entity.
| Name of Guarantor | Jurisdiction of Incorporation or Organization | |||||||
| Allegion plc | Ireland | |||||||
Exhibit 31.1
CERTIFICATION
I, John H. Stone, certify that:
1.I have reviewed the Quarterly Report on Form 10-Q of Allegion plc for the three and nine months ended September 30, 2026;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: | October 22, 2026 | /s/ John H. Stone | |||||||||
| John H. Stone | |||||||||||
| Principal Executive Officer | |||||||||||
Exhibit 31.2
CERTIFICATION
I, Michael J. Wagnes, certify that:
1.I have reviewed the Quarterly Report on Form 10-Q of Allegion plc for the three and nine months ended September 30, 2026;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: | October 22, 2026 | /s/ Michael J. Wagnes | |||||||||
| Michael J. Wagnes | |||||||||||
| Principal Financial Officer | |||||||||||
Exhibit 32.1
Section 1350 Certifications
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of Allegion plc (the Company), does hereby certify that:
The Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2026 (the Form 10-Q) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ John H. Stone | ||
| John H. Stone | ||
| Principal Executive Officer | ||
| October 22, 2026 | ||
| /s/ Michael J. Wagnes | ||
| Michael J. Wagnes | ||
| Principal Financial Officer | ||
| October 22, 2026 | ||