Allegion plc

Good day everyone, my name is Stefan and I'll be your conference operator today. At this time I'd like to welcome you to Allegion second quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks there'll be a question and answer session. If you would like to ask a question during this time and if you've joined via the webinar please use the raised hand icon which can be found at the bottom of your webinar application. At this time I'd like to turn the call over to Josh Pokrzywinski, Vice President of Investor Relations

Thank you, Stephan. Good morning, everyone. Thank you for joining us for Allegion's second quarter 2026 earnings call. With me today are John Stone, President and Chief Executive Officer, and Mike Wagnes, Senior Vice President and Chief Financial Officer of Allegion. Our earnings release, which was issued earlier this morning, and the presentation, which we will refer to in today's call, are available on our website at investor.allegion.com. This call will be recorded and archived on our website. Please go to slide two. statements made in today's call that are not historical facts are considered forward-looking statements and are made pursuant to the safe harbor provisions of federal securities law please see our most recent sec filings for a description of some of the factors that may cause actual results to differ materially from our projections the company assumes no obligation to update these forward-looking statements today's presentation and commentary include non-gap financial measures please refer to the reconciliation and the financial tables of our press release for further details please go to slide three and i'll turn the call over to john

Thanks, Josh. Good morning, everyone. Thanks for joining us. Second quarter results were driven by strong organic growth in the Americas and we see continued momentum in non-residential indicators. Our specification activity has been robust for several quarters and includes the breadth of our core institutional markets, cyclical improvement in commercial verticals like office and multifamily, and strong growth in data center which is still small compared to some of our legacy markets but will continue to gain relevance as that installed base grows and fuels aftermarket over time. I'm also pleased with the return to America's margin expansion. in our international segment we made progress on the erp challenges experienced in the first quarter consistent with our expectations we saw strong sequential margin improvement and expect to build on that in the second half of the year however demand is weaker in several of our european markets including germany which is our largest market and we have taken additional restructuring actions in response With respect to our full year, we're raising our reported revenue outlook to 7.5% to 8.5% and our outlook for organic revenue growth to 3.5% to 4.5% based on stronger expected demand in the Americas, partially offset by weaker international demand. We are raising our adjusted EPS outlook to $8.85 to $9. I'll provide additional details on this later in the call. Please go to slide four. Let's take a look at capital allocation, starting with our organic investments and ongoing demand trend for electronics. Higher education offers a clear example of continued secular growth in electronics. As demand for mobile technology increases on college campuses, these customers are moving from plastic cards and mechanical keys to contactless mobile credentials provided and managed by Allegion. This also drives large-scale hardware modernization. in a recent example from our team two flagship university deployments turned into multi-million dollar opportunities for our company stemming from thousands of Allegion reader and lock upgrades paired with system-wide Allegion credential standardization we also see off-campus housing and property managers adopting the same approach extending secure seamless access from the campuses where students learn into the communities where they live and connect These upgrades deliver real benefits, simpler credential management and updates, lower installation costs, faster integration, and improve security and convenience for the end user. As mobile credential adoption spreads across core institutional markets, our organic investments position Allegion to capture these hardware upgrade cycles, driving deeper customer loyalty and long-term electronics growth and shareholder value. Turning to M&A, we spent $70 million in acquisitions in the first quarter and did not complete any acquisitions in the second quarter. We continue to cultivate a pipeline of opportunities that complement our portfolio. Allegion paid $47 million in dividends and we repurchased 120 million of Allegion shares in the second quarter. and as we've said in the past you can expect Allegion to be balanced, disciplined and consistent with capital deployment oriented towards profitable growth and driving long-term returns for shareholders. At current share price levels we do see attractive valuation in our shares and expect to remain active in the second half. However consistent with past practice our outlook does not include additional share repurchase. Mike will now walk you through second quarter financial results.