Allegion Gears Up to Post Q2 Earnings: Here's What to Expect

Core Viewpoint - Allegion plc (ALLE) is expected to report second-quarter 2025 results on July 24, with projected revenues of $1 billion, reflecting a 3.7% year-over-year growth, and earnings per share (EPS) estimated at $2, indicating a 2% increase from the previous year [1][10]. Group 1: Financial Performance Expectations - The Zacks Consensus Estimate for ALLE's second-quarter revenues is $1 billion, showing a growth of 3.7% from the prior-year quarter [1]. - The consensus estimate for earnings is $2 per share, which has increased by a penny in the past 30 days, indicating a growth of 2% from the year-ago quarter [1]. - ALLE has consistently delivered better-than-expected results in the past four quarters, with an average earnings surprise of 10.1% [2]. Group 2: Segment Performance Insights - The Allegion Americas segment is expected to see a revenue increase of 4.1% year-over-year to $801.9 million, driven by stable demand across various end markets [3]. - The Allegion International segment is anticipated to experience a revenue decline of 4.5% from the year-ago quarter to $186.2 million, impacted by challenges in some European regions despite increased demand for electronic security products [4]. Group 3: Strategic Acquisitions - Allegion has focused on expanding its product offerings through acquisitions, including Lemaar Pty Ltd in March 2025, Next Door Company in February 2025, and Krieger Specialty Products in June 2024, which are expected to enhance its top-line performance [5]. Group 4: Cost and Margin Considerations - Rising operating costs due to increased material costs and investments in new products are likely to impact the bottom line, with cost of sales expected to rise 2.4% year-over-year to $550.2 million [6]. - The adjusted operating margin is projected to decline by 50 basis points to 23.2% in the second quarter [6]. Group 5: Foreign Exchange Impact - Allegion's extensive geographic presence exposes it to foreign exchange headwinds, with a stronger U.S. dollar likely to negatively affect its overseas business [7].