Alarm.com Holdings (Alarm.com Holdings) Operating Income : $66.8 Mil (TTM As of Dec. 2023)

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What is Alarm.com Holdings Operating Income?

Alarm.com Holdings's Operating Income for the three months ended in Dec. 2023 was $25.7 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 was $66.8 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Alarm.com Holdings's Operating Income for the three months ended in Dec. 2023 was $25.7 Mil. Alarm.com Holdings's Revenue for the three months ended in Dec. 2023 was $226.2 Mil. Therefore, Alarm.com Holdings's Operating Margin % for the quarter that ended in Dec. 2023 was 11.35%.

Good Sign:

Alarm.com Holdings Inc operating margin is expanding. Margin expansion is usually a good sign.

Alarm.com Holdings's 5-Year average Growth Rate for Operating Margin % was 9.50% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Alarm.com Holdings's annualized ROC % for the quarter that ended in Dec. 2023 was 12.86%. Alarm.com Holdings's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 was 92.10%.

Alarm.com Holdings Operating Income Historical Data

The historical data trend for Alarm.com Holdings's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Alarm.com Holdings Operating Income Chart

Alarm.com Holdings Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Operating Income

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50.41

56.30

61.57

51.04

66.83

Alarm.com Holdings Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Operating Income	Get a 7-Day Free Trial															14.47	8.82	16.16	16.17	25.68

Alarm.com Holdings Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 adds up the quarterly data reported by the company within the most recent 12 months, which was $66.8 Mil.

Alarm.com Holdings (NAS:ALRM) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Alarm.com Holdings's annualized ROC % for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	102.72 * ( 1 - 20.88% )	/	( (624.266	+	639.482)	/ 2 )
=	81.272064	/	631.874
=	12.86 %

where

	Invested Capital		(Q: Sep. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	1411.497	-	107.262	-	( 679.969	-	max(0, 171.917	-	931.169	+	679.969	))
=	624.266

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	1439.563	-	103.098	-	( 696.983	-	max(0, 175.337	-	956.78	+	696.983	))
=	639.482

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

2. Joel Greenblatt's definition of Return on Capital:

Alarm.com Holdings's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2023 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Sep. 2023		Q: Dec. 2023
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	160.908	/	( ( (82.702 + max(91.821, 0))	+	(78.406 + max(96.503, 0)) )	/	2 )
=	160.908	/	( ( 174.523	+	174.909 )	/	2 )
=	160.908	/	174.716
=	92.10 %

where Working Capital is:

	Working Capital		(Q: Sep. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(110.267	+	114.248	+	26.685)	-	(107.262	+	10.336	+	41.781)
=	91.821

	Working Capital		(Q: Dec. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(130.626	+	96.14	+	33.031)	-	(103.098	+	10.193	+	50.003)
=	96.503

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Dec. 2023) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Alarm.com Holdings's Operating Margin % for the quarter that ended in Dec. 2023 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	25.68	/	226.237
	=	11.35 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Alarm.com Holdings Operating Income Related Terms

Thank you for viewing the detailed overview of Alarm.com Holdings's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Alarm.com Holdings (Alarm.com Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Alarm.com Holdings Inc (NAS:ALRM) » Definitions » Operating Income

Comparable Companies

Traded in Other Exchanges

3RL:Germany 3RL:Germany

Address

8281 Greensboro Drive, Suite 100, Tysons, VA, USA, 22102

Website

https://www.alarm.com

Alarm.com Holdings Inc has two reportable segments: Alarm.com & Other. The Alarm.com segment represents the cloud-based Software platforms for intelligently connected property & related solutions. The other segment is focused on researching, developing & offering residential & commercial automation solutions & energy management products & services in adjacent markets. The majority of revenue is from the Alarm.com segment. The platform allows home & business owners to secure their properties and automate & control an array of connected devices. SaaS & license fees from service providers, who resell these services & pay Alarm.com a monthly subscription, are the sources of revenue for the firm. A majority of revenue is generated in the United States & Canada.

Executives

Steve Valenzuela	officer: Chief Financial Officer	1800 GREEN HILLS ROAD, SCOTTS VALLEY CA 95066
Daniel Ramos	officer: Sr. VP-Corporate Development	C/O ALARM.COM, INC., 8150 LEESBURG PIKE, VIENNA VA 22182
Timothy P Mcadam	director	250 MIDDLEFIELD RD, MENLO PARK CA 94025
Simone Wu	director	1 CHOICE HOTELS CIRCLE, ROCKVILLE MD 20850
Jeffrey A Bedell	officer: Chief Strategy & Innovation	C/O MICROSTRATEGY INC, 1850 TOWERS CRESCENT PLAZA, VIENNA VA 22182
Stephen Trundle	director, officer: President and CEO	C/O ALARM.COM HOLDINGS, INC., 8150 LEESBURG PIKE, VIENNA VA 22182
Daniel Kerzner	officer: Chief Product Officer	C/O ALARM.COM HOLDINGS, INC., 8150 LEESBURG PIKE, VIENNA VA 22182
Timothy J. Whall	director	C/O ADT, LLC, 1501 YAMATO ROAD, BOCA RATON FL 33431
Donald E Clarke	director	C/O VISUAL NETWORKS INC, 2092 GAITHER ROAD, ROCKVILLE MD 20850
Stephen C. Evans	director	C/O ALARM.COM HOLDINGS, INC., 8281 GREENSBORO DRIVE, SUITE 100, TYSONS VA 22102
Hugh Panero	director
Shattuck Mayo A Iii	director	C/O GAP, INC., 2 FOLSOM ST., SAN FRANCISCO CA 94105
Tcv Vii Management, L.l.c.	10 percent owner, other: May be part of a13(d) group	528 RAMONA STREET, PALO ALTO CA 94301
Technology Crossover Management Vii, L.p.	10 percent owner, other: May be part of a 13(d) group	528 RAMONA STREET, PALO ALTO CA 94301
Christopher P Marshall	10 percent owner, other: May be part of a 13(g) group	250 MIDDLEFIELD RD, MENLO PARK CA 94025