Results at a glance
- Period
- FY2026Q3
- Revenue
- $1.1B (1,089.67 MUSD)
- Net income
- $157.9M (157.927 MUSD)
- Net margin
- 14.5%
From the Rollins Open LedgerView the live ledgerIssuer filing (FY2026Q3)
Rollins, Inc. (NYSE: ROL), the Orkin pest-control parent, reported third-quarter 2026 revenue of $1,089.7 million — up 6.2% year over year, with organic growth of 4.4% — but net income fell 3.4% to $157.9 million, or $0.33 per diluted share versus $0.34. Management called itself "disappointed" and pointed at "how the customer acquisition landscape is evolving." The split shows where: residential revenue of $499.7 million grew just 2.3% organically while commercial's $360.7 million grew 6.6% organically. Operating income slipped 1.0% to $222.9 million as cost of services (+8.4% to $506.8 million) and SG&A (+8.4% to $326.8 million) both outran revenue, compressing the operating margin 140 basis points to 20.5% and adjusted EBITDA margin 170 basis points to 23.5%. Interest expense jumped 34.3% to $10.7 million and the tax rate ticked up to 25.7% from 24.8%, taking pretax income down 2.2% to $212.6 million.
Cash told the opposite story: operating cash flow surged 26.4% to $242 million and free cash flow 28.8% to $235 million, flattered by a $63 million tax-refund timing benefit. Rollins put it to work the usual way — $27 million on acquisitions, $6 million of capex, $120 million of buybacks and $87 million of dividends — and raised the quarterly dividend 10.6% to $0.1825. The balance sheet keeps levering gently for deals: short-term debt nearly doubled to $239.6 million (up $115.9 million year-to-date) while goodwill rose $91.8 million to $1,466.4 million. Trade receivables jumped $53.4 million to $255.9 million, and a new $13.7 million real estate-held-for-sale line appeared. Total equity inched up just $16.1 million to $1,390.5 million as buybacks and dividends nearly matched earnings.
The Headline Numbers
| Metric | Q3 2026 | Q3 2025 |
|---|---|---|
| Revenue | $1,089.7M (+6.2%) | $1,026.1M |
| Organic revenue growth | +4.4% | — |
| Residential revenue (organic) | $499.7M (+2.3%) | $476.3M |
| Commercial revenue (organic) | $360.7M (+6.6%) | $335.0M |
| Operating income | $222.9M (−1.0%) | $225.0M |
| Operating margin | 20.5% (−140bp) | 21.9% |
| Adjusted EBITDA margin | 23.5% (−170bp) | 25.2% |
| Net income | $157.9M (−3.4%) | $163.5M |
| Diluted EPS | $0.33 (−2.9%) | $0.34 |
| Operating cash flow | $242M (+26.4%) | $191M |
| Quarterly dividend | $0.1825 (+10.6%) | $0.1650 |
| Goodwill | $1,466.4M* | $1,374.7M |
| Short-term debt | $239.6M* | $123.7M |
* Balance-sheet figures as of September 30, 2026 versus December 31, 2025.
Nine-month revenue of $3,074.7 million is up 8.0% year over year, but nine-month net income of $409.7 million is essentially flat (−0.1%) and EPS holds at $0.85 — the margin story is a three-quarter story, not a one-quarter blip. Still, the quarter's miss lands on a compounder trading at a compounder's multiple precisely because residential pest control rarely stumbles; whether this is a customer-acquisition air pocket or a demand signal is now the whole debate.
Five years in the ledger: the acquisition machine, in numbers
The ledger runs FY2021–FY2025 plus this quarter. Revenue compounded from $2,424.3 million to $3,761.1 million (+55%) while net income grew from $356.6 million to $526.7 million and EPS from $0.72 to $1.09. Goodwill nearly doubled from $786.5 million to $1,374.7 million — the acquisition trail — funded first by long-term debt (up to $490.8 million in FY2023, then termed back down) and lately by the revolver: short-term debt debuted at $123.7 million in FY2025 and has already doubled. Three artifacts reward a look: FY2021's $35.7 million of other income (a gain-heavy year), FY2023's $5.2 million of restructuring costs, and the dividend's 61% climb from $0.42 to $0.6775. Every annual income statement and balance sheet, plus this quarter's 10-Q statements, is modeled as examinable Beancount below.
