APi's Q1 2025 Earnings Call: Unpacking Contradictions in Backlog, Tariffs, and Growth Projections
Earnings DecryptFriday, May 2, 2025 12:49 pm ET

Backlog and revenue growth expectations, tariff exposure and impact, pricing strategy and inflation, international organic growth expectations, and backlog and project delays are the key contradictions discussed in APi's latest 2025Q1 earnings call.
Revenue and Organic Growth:
- APi Group Corporation reported an increase in net revenues by 7.4% to $1.72 billion for the three months ended March 31, compared to $1.6 billion in the prior year period.
- Organic growth was approximately 2%, driven by strong performance in Safety Services, particularly inspection service and monitoring revenues.
Margin Expansion:
- The adjusted gross margin grew by 100 basis points to 31.7%, and the adjusted EBITDA margin increased by 30 basis points to 11.2%.
- Margin expansion was attributed to disciplined customer and project selection, pricing improvements, and value capture initiatives in the international business.
Safety Services Performance:
- Safety Services reported revenues increased by 13.4% to $1.27 billion, with organic growth at 5.6%.
- The growth was due to double-digit inspection revenue increases in North America and high-single-digit growth in inspection service and monitoring revenues.
Specialty Services Challenges:
- Specialty Services revenues decreased by 6.8% to $453 million, with an organic decline of 6.6%.
- The decline was attributed to a decrease in project and service revenues and adverse weather impacts. However, backlog grew by 7% organically.
API Total Revenue YoY, Total Revenue
Revenue and Organic Growth:
- APi Group Corporation reported an increase in net revenues by 7.4% to $1.72 billion for the three months ended March 31, compared to $1.6 billion in the prior year period.
- Organic growth was approximately 2%, driven by strong performance in Safety Services, particularly inspection service and monitoring revenues.
Margin Expansion:
- The adjusted gross margin grew by 100 basis points to 31.7%, and the adjusted EBITDA margin increased by 30 basis points to 11.2%.
- Margin expansion was attributed to disciplined customer and project selection, pricing improvements, and value capture initiatives in the international business.
Safety Services Performance:
- Safety Services reported revenues increased by 13.4% to $1.27 billion, with organic growth at 5.6%.
- The growth was due to double-digit inspection revenue increases in North America and high-single-digit growth in inspection service and monitoring revenues.
Specialty Services Challenges:
- Specialty Services revenues decreased by 6.8% to $453 million, with an organic decline of 6.6%.
- The decline was attributed to a decrease in project and service revenues and adverse weather impacts. However, backlog grew by 7% organically.

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