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___________________________________________________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 1-4422

(Address of principal executive offices)

(Zip Code)

(Registrant’s telephone number, including area code)

___________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x   No o

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x   No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No x

Rollins, Inc. had 484,628,814 shares of its $1 par value Common Stock outstanding as of October 20, 2025.

(unaudited)

			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Retained Earnings						Total
			Shares						Amount
Balance at June 30, 2025			484,640						$	484,640					$	159,824					$	(22,607)					$	822,014					$	1,443,871
Net income			—						—						—						—						163,527						163,527
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments			—						—						—						(4,437)						—						(4,437)
Unrealized gain on available for sale securities			—						—						—						86						—						86
Cash dividends			—						—						—						—						(80,077)						(80,077)
Stock compensation			(11)						(11)						10,066						—						—						10,055
Shares withheld for payment of employee taxes			(1)						(1)						(976)						—						—						(977)
Balance at September 30, 2025			484,628						$	484,628					$	168,914					$	(26,958)					$	905,464					$	1,532,048

			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Retained Earnings						Total
			Shares						Amount
Balance at June 30, 2024			484,314						$	484,314					$	137,914					$	(31,196)					$	645,026					$	1,236,058
Net income			—						—						—						—						136,913						136,913
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments			—						—						—						9,921						—						9,921
Unrealized gain on available for sale securities			—						—						—						138						—						138
Cash dividends			—						—						—						—						(72,820)						(72,820)
Stock compensation			(16)						(16)						7,558						—						—						7,542
Shares withheld for payment of employee taxes			8						8						17						—						—						25
Balance at September 30, 2024			484,306						$	484,306					$	145,489					$	(21,137)					$	709,119					$	1,317,777

			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Retained Earnings						Total
			Shares						Amount
Balance at December 31, 2024			484,372						$	484,372					$	155,205					$	(43,634)					$	734,650					$	1,330,593
Net income			—						—						—						—						410,264						410,264
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments			—						—						—						16,066						—						16,066
Pension settlement			—						—						—						493						—						493
Unrealized gain on available for sale securities			—						—						—						117						—						117
Cash dividends			—						—						—						—						(239,450)						(239,450)
Stock compensation			555						555						29,309						—						—						29,864
Shares withheld for payment of employee taxes			(299)						(299)						(15,600)						—						—						(15,899)
Balance at September 30, 2025			484,628						$	484,628					$	168,914					$	(26,958)					$	905,464					$	1,532,048

			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Retained Earnings						Total
			Shares						Amount
Balance at December 31, 2023			484,080						$	484,080					$	131,840					$	(26,755)					$	566,402					$	1,155,567
Net income			—						—						—						—						360,704						360,704
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments			—						—						—						5,453						—						5,453
Unrealized gain on available for sale securities			—						—						—						165						—						165
Cash dividends			—						—						—						—						(217,987)						(217,987)
Stock compensation			495						495						24,914						—						—						25,409
Shares withheld for payment of employee taxes			(269)						(269)						(11,265)						—						—						(11,534)
Balance at September 30, 2024			484,306						$	484,306					$	145,489					$	(21,137)					$	709,119					$	1,317,777

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, the instructions to Form 10-Q and applicable sections of Securities and Exchange Commission ("SEC") regulation S-X, and therefore do not include all information and footnotes required by U.S. GAAP for complete financial statements. There have been no material changes in the Company’s significant accounting policies or the information disclosed in the notes to the consolidated financial statements included in the Annual Report on Form 10-K of Rollins, Inc. (including its subsidiaries unless the context otherwise requires, “Rollins,” “we,” “us,” “our,” or the “Company”) for the year ended December 31, 2024. Accordingly, the quarterly condensed consolidated financial statements and related disclosures herein should be read in conjunction with the 2024 Annual Report on Form 10-K.

The Company’s condensed consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the condensed consolidated financial statements. The Company considered the impact of economic trends on the assumptions and estimates used in preparing the condensed consolidated financial statements. In the opinion of management, all material adjustments necessary for a fair presentation of the Company’s financial results for the quarter have been made. These adjustments are of a normal recurring nature but complicated by the continued uncertainty surrounding economic trends. The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of results for the entire year. The severity, magnitude and duration of certain economic trends continue to be uncertain and are difficult to predict. Therefore, our accounting estimates and assumptions may change over time in response to economic trends and may change materially in future periods.

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, while retrospective application is permitted. The Company is currently evaluating the potential impact of adopting this new ASU on its disclosures.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (DISE), which requires additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The guidance will be effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of this ASU will have on its disclosures.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The guidance provides an optional practical expedient when applying the guidance related to the estimation of expected credit losses for current accounts receivable and current contract assets resulting from transactions arising from contracts with customers. The amendments in ASU 2025-05 are effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. The requirements will be applied prospectively. The Company is currently evaluating the potential impact of adopting this new ASU on its condensed consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software.

The guidance modernizes and clarifies the threshold for when an entity is required to start capitalizing software costs and is based on when (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in ASU 2025-06 are effective for fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. The requirements will be applied prospectively with the option for a modified or retrospective application. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the potential impact of adopting this new ASU on its condensed consolidated financial statements and related disclosures.

On April 1, 2025, the Company acquired 100% of Saela Holdings, LLC ("Saela") for $207.2 million. The Company funded this acquisition using cash on hand and borrowings under the commercial paper program.

The acquisition will expand the Rollins family of brands, and management believes the acquisition will drive long-term value given Saela's attractive financial profile and complementary end market exposure.

The Saela acquisition has been accounted for as a business combination, and Saela's results of operations are included in the Company's operations from the acquisition date. During the three and nine months ended September 30, 2025, Saela contributed revenues of $19.6 million and $38.5 million, respectively, and net earnings of $2.2 million and $5.0 million, respectively.

The valuation of the Saela acquisition was performed by a third-party valuation specialist under management’s supervision. The estimated purchase price allocation disclosed as of June 30, 2025 was revised during the measurement period as new information was received and analyzed resulting in an increase in customer contracts, a decrease in goodwill, and other immaterial changes, as presented in the table below. The initial and updated preliminary values of identified assets acquired and liabilities assumed for Saela are summarized as follows:

Included in the total consideration above are cash payments of $193.7 million made upon closing, contingent consideration valued at $8.8 million that is based on Saela's expected financial performance in the two years following the acquisition, and holdback liabilities valued at $4.7 million to be held by the Company to settle indemnity claims and purchase price adjustments. The fair value of the contingent consideration was estimated using a Monte Carlo simulation. During the three and nine months ended September 30, 2025, we recognized a charge of $1.1 million and $2.2 million, respectively, related to adjustments to the fair value of contingent consideration resulting from the acquisition of Saela.

This charge is reported in sales, general and administrative expenses on our condensed consolidated statement of income.

The acquired Saela customer contracts are estimated to have a remaining useful life of 7 years. The acquired trademarks and tradenames are expected to have an indefinite useful life. See Note 6, Goodwill and Intangible Assets, for further details.

Goodwill from this acquisition represents the excess of the purchase price over the fair value of net assets of the business acquired. The factors contributing to the amount of goodwill are based on strategic and synergistic benefits that are expected to be realized. The recognized goodwill is expected to be deductible for tax purposes. Valuations of certain assets and liabilities, including intangible assets and goodwill, as of the acquisition date have not been finalized at this time and are provisional.

The following table presents unaudited consolidated pro forma information as if the acquisition of Saela had occurred on January 1, 2024. This information presented below is for illustrative purposes only and is not necessarily indicative of results that would have been achieved if the acquisition had actually occurred as of the beginning of such years or results which may be achieved in the future.

This information adjusts for the effects of material business combination items, including the alignment of accounting policies, the effect of fair value adjustments including the amortization of acquired intangible assets, and income tax effects.

The Company made 19 other acquisitions during the nine months ended September 30, 2025. The aggregate preliminary values of major classes of assets acquired and liabilities assumed recorded at the dates of acquisition are summarized as follows:

Included in the total consideration of $106.6 million are acquisition holdback liabilities of $12.7 million.

The Company also made payments of $2.8 million for prior year acquisitions during the nine months ended September 30, 2025.

Goodwill from acquisitions represents the excess of the purchase price over the fair value of net assets of businesses acquired. The factors contributing to the amount of goodwill are based on strategic and synergistic benefits that are expected to be realized. A majority of the recognized goodwill is expected to be deductible for tax purposes. Valuations of certain assets and liabilities, including intangible assets and goodwill, as of the acquisition date have not been finalized at this time and are provisional.

Revenue, classified by the major geographic areas in which our customers are located, was as follows:

Revenue from external customers, classified by significant service offering, was as follows:

The Company records unearned revenue when we have either received payment or contractually have the right to bill for services in advance of the services or performance obligations being performed. Unearned revenue recognized in the three months ended September 30, 2025 and 2024 was $69.9 million and $63.8 million, respectively. Unearned revenue recognized in the nine months ended September 30, 2025 and 2024 was $205.8 million and $189.1 million, respectively. Changes in unearned revenue were as follows:

As of September 30, 2025 and December 31, 2024, the Company had long-term unearned revenue of $44.5 million and $43.0 million, respectively, recorded in other long-term accrued liabilities on our condensed consolidated statements of financial position. Unearned short-term revenue is recognized over the next 12-month period. During the three and nine months ended September 30, 2025, we recognized $45.2 million and $135.6 million of revenue that was included in the balance of unearned revenue at December 31, 2024. During the three and nine months ended September 30, 2024, we recognized $43.1 million and $129.3 million of revenue that was included in the balance of unearned revenue at December 31, 2023. The majority of unearned long-term revenue is recognized over a period of five years or less with immaterial amounts recognized through 2035.

Incremental costs of obtaining a contract include only those costs that we incur to obtain a contract that we would not have incurred if the contract had not been obtained, primarily sales commissions. These costs are recorded as an asset and amortized to expense over the life of the contract to the extent such costs are expected to be recovered. As of September 30, 2025, we have $23.5 million of unamortized capitalized costs to obtain a contract, of which $11.2 million is recorded within other current assets and $12.3 million is recorded within other assets on our condensed consolidated statements of financial position. As of December 31, 2024, we had $23.4 million of unamortized capitalized costs to obtain a contract, of which $19.3 million was recorded within other current assets and $4.1 million was recorded within other assets on our condensed consolidated statements of financial position. Amortization of capitalized costs is recorded within sales, general and administrative expense on our condensed consolidated statements of income. During the three and nine months ended September 30, 2025, we recorded approximately $9.4 million and $24.4 million, respectively, of amortization of capitalized costs. During the three and nine months ended September 30, 2024, we recorded $6.7 million and $14.7 million of amortization of capitalized costs.

The Company is exposed to credit losses primarily related to accounts receivables and financed receivables derived from customer services revenue. To reduce credit risk for residential pest control accounts receivable, we promote enrollment in our auto-pay programs. In general, we may suspend future services for customers with past due balances. The Company’s credit risk is generally low with a large number of individuals and entities comprising Rollins’ customer base and dispersion across many different geographical regions.

The Company manages its financed receivables on an aggregate basis when assessing and monitoring credit risks. The Company’s established credit evaluation and monitoring procedures seek to minimize the amount of business we conduct with higher risk customers. The credit quality of a potential obligor is evaluated at the loan origination based on an assessment of the individual’s credit bureau score. The Company requires a potential obligor to have good credit worthiness with low risk before entering into a contract. Depending upon the individual’s credit score, the Company may accept with 100% financing, require a significant down payment or turn down the contract. Delinquencies of accounts are monitored each month. Financed receivables include installment receivable amounts, some of which are due subsequent to one year from the balance sheet dates.

The Company’s allowances for credit losses for trade accounts receivable and financed receivables are developed using historical collection experience, current economic and market conditions, reasonable and supportable forecasts, and a review of the current status of customers’ receivables. The Company’s receivable pools are classified between residential customers, commercial customers, large commercial customers, and financed receivables. Accounts are written off against the allowance for credit losses when the Company determines that amounts are uncollectible, and recoveries of amounts previously written off are recorded when collected. The Company stops accruing interest to these receivables when they are deemed uncollectible.

Below is a roll forward of the Company’s allowance for credit losses for the three and nine months ended September 30, 2025 and 2024.

The following table summarizes changes in goodwill during the nine months ended September 30, 2025:

The following table sets forth the components of indefinite-lived and amortizable intangible assets as of September 30, 2025 and December 31, 2024.

Amortization expense related to intangible assets was $23.7 million and $19.2 million for the three months ended September 30, 2025 and 2024, respectively. Amortization expense related to intangible assets was $67.4 million and $57.2 million for the nine months ended September 30, 2025 and 2024, respectively. Amortizable intangible assets are amortized on a straight-line basis over their economic useful lives.

Estimated amortization expense for the existing carrying amount of amortizable intangible assets for each of the five succeeding fiscal years as of September 30, 2025 are as follows:

Components of long-term debt were as follows:

In February 2025, we issued ten-year notes with an aggregate principal amount of $500 million due on February 24, 2035 (the “2035 Senior Notes”) in a private placement to qualified institutional buyers pursuant to Section 4(a)(2) and Rule 144A under the Securities Act. We issued the 2035 Senior Notes at 98.443% of par, representing a discount of $7.8 million and paid approximately $6.1 million for debt issuance costs. The interest is payable semi-annually in arrears on February 24 and August 24 of each year at 5.25% per annum, beginning on August 24, 2025, and the entire principal amount is due at the time of maturity.

We used the net proceeds from this offering primarily to repay outstanding borrowings under the Revolving Credit Facility, as defined below, as well as for general corporate purposes.

The 2035 Senior Notes are senior unsecured obligations of the Company and, at the time of issuance, were guaranteed by the Company’s subsidiaries that were guarantors under its Revolving Credit Facility, provided for by the Credit Agreement defined below. Subsequent to the issuance of the 2035 Senior Notes, and described further below, we amended our Credit Agreement to release the Company's subsidiaries as guarantors, which also released them as guarantors on the 2035 Senior Notes.

The indenture governing the 2035 Senior Notes contains customary covenants that limit the Company and its subsidiaries’ ability to, among other things, incur liens and certain types of indebtedness. The indenture also provides for customary events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding 2035 Senior Notes to be due and payable immediately. We were in compliance with all covenants as of September 30, 2025.

The effective interest rate of our 2035 Senior Notes was 5.6% as of September 30, 2025.

In March 2025, the Company entered into Amendment No. 1 to the Credit Agreement (the “Amendment No 1”), among the Company, JPMorgan Chase, and the lenders party thereto, which amended the Credit Agreement with, among others, the Company and the Administrative Agent. The Amendment No. 1, among other things, released each of Orkin, LLC, Northwest Exterminating Co., LLC, Clark Pest Control of Stockton, Inc. and Hometeam Pest Defense, Inc. (collectively, the “Existing Guarantors”) as guarantors under the Credit Agreement. Following the release of the Existing Guarantors from their guarantees of the obligations under the Credit Agreement, no subsidiary of the Company guarantees the obligations under the Credit Agreement.

Loans under the Credit Agreement bear interest, at Rollins’ election, at (i) for loans denominated in U.S. Dollars, (A) an alternate base rate (subject to a floor of 0.00%), which is the greatest of (x) the prime rate publicly announced from time to time by JPMorgan Chase, (y) the greater of the federal funds effective rate and the Federal Reserve Bank of New York overnight bank funding rate, plus 50 basis points, and (z) Adjusted Term SOFR for a one month interest period, plus a margin ranging from 0.00% to 0.50% per annum based on Rollins’ consolidated total net leverage ratio; or (B) the greater of term SOFR for the applicable interest period plus 10 basis points (“Adjusted Term SOFR”) and zero, plus a margin ranging from 1.00% to 1.50% per annum based on Rollins’ consolidated total net leverage ratio; and (ii) for loans denominated in other currencies, such interest rates as set forth in the Credit Agreement.

The Credit Agreement contains customary terms and conditions, including, without limitation, certain financial covenants including covenants restricting Rollins’ ability to incur certain indebtedness or liens, or to merge or consolidate with or sell substantially all of its assets to another entity. Further, the Credit Agreement contains a financial covenant restricting Rollins’ ability to permit the ratio of Rollins’ consolidated total net debt to EBITDA to exceed 3.50 to 1.00. Following certain acquisitions, Rollins may elect to increase the financial covenant level to 4.00 to 1.00 temporarily.

The Company is in compliance with applicable debt covenants as of September 30, 2025.

In March 2025, we established a commercial paper program under which we may issue unsecured commercial paper up to a total of $1 billion outstanding at any time, with maturities of up to 397 days from the date of issue. Borrowings under this program are generally outstanding for 30 days or less. The net proceeds from the issuance of commercial paper are used for various purposes, including general corporate purposes and funding for acquisitions. As of September 30, 2025, the Company had no outstanding borrowings under the commercial paper program.

Assets and liabilities recorded at fair value are measured using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The levels of the fair value hierarchy are:

•Level 1: observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2: inputs other than quoted prices in active markets in Level 1 that are either directly or indirectly observable; and

•Level 3: unobservable inputs for which little or no market data exists.

As of September 30, 2025 and December 31, 2024, we had investments in international bonds of $6.9 million and $8.2 million, respectively. These bonds are accounted for as available for sale securities and are Level 2 assets under the fair value hierarchy. The bonds are recorded at their fair market values and reported within other current assets and other assets on our condensed consolidated statements of financial position. The unrealized gain or loss activity during the three and nine months ended September 30, 2025 and 2024 was not significant.

As of September 30, 2025 and December 31, 2024, the Company had $42.1 million and $21.0 million of acquisition holdback and earnout liabilities payable to former owners of acquired companies, respectively. Holdback and earnout liabilities are considered Level 3 liabilities under the fair value hierarchy. The earnout liabilities were adjusted to reflect the expected probability of payout, and both earnout and holdback liabilities were discounted to their net present value on the Company’s condensed consolidated statements of financial position. The table below presents a summary of the changes in fair value for these liabilities.

The carrying amount of cash and cash equivalents, trade and financed receivables, accounts payable, and short-term liabilities, including short-term borrowings under our commercial paper program, approximate fair value due to their short-term nature. The carrying amounts of borrowings outstanding under our Revolving Credit Facility approximate fair value, as interest rates are variable and reflective of market rates.

The following table presents the aggregate fair value and carrying value of our 2035 Senior Notes, which are classified as Level 2 within the fair value hierarchy:

In the normal course of business, the Company and its subsidiaries are involved in, and will continue to be involved in, various claims, arbitrations, contractual disputes, investigations, and regulatory and litigation matters relating to, and arising out of, our businesses and our operations. These matters may involve, but are not limited to, allegations that our services or vehicles caused damage or injury, claims that our services did not achieve the desired results, claims related to acquisitions and allegations by federal, state or local authorities, including taxing authorities, of violations of regulations or statutes. In addition, we are parties to employment-related investigations, cases, and claims from time to time, which may include claims on a representative or class action basis alleging wage and hour law violations, claims filed under California's Private Attorneys General Act, and claims and investigations related to our enforcement of post-employment restrictive covenants. We are also involved from time to time in certain environmental matters primarily arising in the normal course of business. We evaluate pending and threatened claims and establish loss contingency reserves based upon outcomes we currently believe to be probable and reasonably estimable in accordance with ASC 450.

The Company retains, up to specified limits, certain risks related to general liability, workers’ compensation and auto liability. The estimated costs of existing and future claims under the retained loss program are accrued based upon historical trends as incidents occur, whether reported or unreported (although actual settlement of the claims may not be made until future periods) and may be subsequently revised based on developments relating to such claims. The Company contracts with an independent third-party actuary to provide the Company an estimated liability based upon historical claims information. The actuarial study is a major consideration in establishing the reserve, along with management’s knowledge of changes in business practice and existing claims compared to current balances. Management’s judgment is inherently subjective as a number of factors are outside management’s knowledge and control. Additionally, historical information is not always an accurate indication of future events. The accruals and reserves we hold are based on estimates that involve a degree of judgment and are inherently variable and could be overestimated or insufficient.

If actual claims exceed our estimates, our operating results could be materially affected, and our ability to take timely corrective actions to limit future costs may be limited.

During the three months ended September 30, 2025, the Company paid $80.1 million, or $0.165 per share, in cash dividends compared to $72.8 million, or $0.150 per share, during the same period in 2024. During the nine months ended September 30, 2025, the Company paid $239.5 million, or $0.495 per share, in cash dividends compared to $218.0 million or $0.450 per share, during the same period in 2024.

The Company withholds shares from employees for the payment of their taxes on equity awards that have vested. The Company withheld an immaterial amount in connection with employee tax obligations during the three month periods ended September 30, 2025 and 2024, respectively. The Company withheld $14.9 million and $11.5 million in connection with employee tax obligations during the nine month periods ended September 30, 2025 and 2024, respectively.

The Company did not repurchase shares on the open market during the three and nine months ended September 30, 2025 and September 30, 2024.

The following table summarizes the components of the Company’s stock-based compensation programs, including time-lapsed restricted share awards, performance share unit awards, and employee stock purchase plan, recorded as expense:

The Company reports both basic and diluted earnings per share. Basic earnings per share is computed by dividing net income available to participating common stockholders by the weighted average number of participating common shares outstanding for the period. Diluted earnings per share is calculated by dividing the net income available to participating common shareholders by the diluted weighted average number of shares outstanding for the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive equity.

A reconciliation of weighted average shares outstanding is as follows:

The Company’s provision for income taxes is recorded on an interim basis based upon the Company’s estimate of the annual effective income tax rate for the full year applied to “ordinary” income or loss, adjusted each quarter for discrete items. The Company recorded a provision for income taxes of $53.9 million and $48.3 million for the three months ended September 30, 2025 and 2024, and $136.0 million and $124.2 million for the nine months ended September 30, 2025 and 2024, respectively.

The Company’s effective tax rate decreased to 24.8% in the third quarter of 2025 compared with 26.1% in the third quarter of 2024. During the nine months ended September 30, 2025, the Company's effective tax rate decreased to 24.9% compared to 25.6% in 2024. The reduced rate for both periods was primarily due to the purchase and use of transferable federal income tax credits during the three months ended September 30, 2025.

Cash paid for taxes during the nine months ended September 30, 2025 was $110.8 million, inclusive of cash paid to taxing authorities and third parties for purchases of investment tax credits.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”). Significant provisions of the OBBBA include the permanent extension of certain provisions of the 2017 Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The Company has evaluated the OBBBA and does not expect it to have a material impact on our condensed consolidated financial statements.

The Company operates under one reportable segment which contains our residential, commercial, and termite and ancillary service offerings. The Company's chief operating decision maker ("CODM") is the chief executive officer. The CODM uses net income to assess financial performance and allocate resources. This financial metric is used by the CODM to make key operating decisions, such as the determination of the rate of growth investments and the allocation of budget between cost categories. The measure of segment assets is reported on the condensed consolidated statements of financial position as total consolidated assets.

The following table presents selected financial information with respect to the Company’s single reportable segment:

1) Other cost of services provided includes facilities costs, professional services, maintenance and repairs, software license costs, and other expenses directly related to providing services.

2) Other sales, general and administrative includes facilities costs, professional services, maintenance and repairs, software license costs, bad debt expense, and other administrative expenses.

See the condensed consolidated financial statements for other financial information regarding the Company’s reportable segment. See Note 4, Revenue for further information on revenue.

The Company's long-lived tangible assets, as well as the Company's operating lease right-of-use assets recognized in the condensed consolidated statements of financial position were located as follows:

On October 28, 2025, the Company’s Board of Directors declared a regular quarterly cash dividend on its common stock of $0.1825 per share payable on December 10, 2025 to shareholders of record at the close of business on November 10, 2025.

The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report on Form 10-Q.

Below is a summary of the key operating results for the three months ended September 30, 2025:

•Third quarter revenues were $1.0 billion, an increase of 12.0% over the third quarter of 2024 with organic revenues* increasing 7.2%.

•Quarterly operating income was $225.0 million, an increase of 17.3% over the third quarter of 2024. Quarterly operating margin was 21.9%, an increase of 100 basis points versus the third quarter of 2024. Adjusted operating income* was $232.1 million, an increase of 18.4% over the prior year. Adjusted operating margin* was 22.6%, an increase of 120 basis points compared to the prior year.

•Adjusted EBITDA* was $258.3 million, an increase of 17.7% over the prior year. Adjusted EBITDA margin* was 25.2%, an increase of 120 basis points versus the third quarter of 2024.

•Quarterly net income was $163.5 million, an increase of 19.4% over the prior year. Adjusted net income* was $168.5 million, an increase of 20.7% over the prior year.

•Quarterly EPS was $0.34 per diluted share, a 21.4% increase over the prior year EPS of $0.28. Adjusted EPS* was $0.35 per diluted share, an increase of 20.7% over the prior year.

•Operating cash flow was $191.3 million for the quarter, an increase of 30.2% compared to the prior year. The Company invested $34.7 million in acquisitions, $8.5 million in capital expenditures, and paid dividends totaling $80.1 million.

Demand remains favorable to start the fourth quarter and the pipeline of acquisition activity remains healthy. Although we continue to navigate a highly uncertain macroeconomic environment, we believe we are well positioned to continue to deliver strong results in 2025.

We remain focused on driving 7% to 8% organic revenue growth while adding 3% to 4% of inorganic revenue growth for 2025. We continue to focus on improving the efficiency of our business model while investing in programs aimed at growing our business across our service offerings.

*Amounts are non-GAAP financial measures. See the schedules below for a discussion of non-GAAP financial metrics including a reconciliation to the most directly comparable GAAP measure.

The continued disruption in economic markets due to inflation, changing interest rates, business interruptions due to natural disasters and changes in weather patterns, employee shortages, and supply chain issues all pose challenges which may adversely affect our future performance. The Company continues to execute various strategies previously implemented to help mitigate the impact of these economic disruptors. However, the Company cannot reasonably estimate whether these strategies will help mitigate the impact of these economic disruptors in the future.

Additionally, the Company continues to monitor ongoing changes to global trade policies, including the imposition of tariffs. The broader economic impact of these policies is uncertain, and while we may experience changes in fleet-related expenses and materials and supplies, we do not expect to be materially affected.

The Company’s condensed consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the condensed consolidated financial statements. The Company considered the impact of economic trends on the assumptions and estimates used in preparing the condensed consolidated financial statements. In the opinion of management, all material adjustments necessary for a fair presentation of the Company’s financial results for the quarter have been made. These adjustments are of a normal recurring nature but are complicated by the continued uncertainty surrounding these economic trends. The severity, magnitude and duration of certain economic trends continue to be uncertain and are difficult to predict.

Therefore, our accounting estimates and assumptions may change over time in response to economic trends and may change materially in future periods.

The extent to which these economic trends will continue to impact the Company’s business, financial condition and results of operations is uncertain. Therefore, we cannot reasonably estimate the full future impacts of these matters at this time.

(1) Exclusive of depreciation and amortization

(2) Amounts are non-GAAP financial measures. See "Non-GAAP Financial Measures" of this Form 10-Q for a discussion of non-GAAP financial metrics including a reconciliation to the most directly comparable GAAP measure.

The following table presents financial information, including our significant expense categories, for the three months ended September 30, 2025 and 2024:

The following presents a summary of revenues by service offering for the three months ended September 30, 2025 and September 30, 2024, respectively:

Revenues for the quarter ended September 30, 2025 were $1.0 billion, an increase of $109.8 million, or 12.0%, from 2024 revenues of $916.3 million. The increase in revenues was driven by demand from our customers across all major service offerings. Organic revenue* growth was 7.2% with acquisitions adding 4.8% in the quarter. Residential pest control revenue increased 11.2%, commercial pest control revenue increased 11.8% and termite and ancillary services grew 15.2% including both organic and acquisition-related growth in each area. Organic revenue* growth was strong across our service offerings, growing 5.2% in residential, 8.3% in commercial, and 10.8% in termite and ancillary activity.

Revenues are impacted by the seasonal nature of the Company’s pest and termite control services. The increase in pest activity, as well as the metamorphosis of termites in the spring and summer (the occurrence of which is determined by the change in seasons), has historically resulted in an increase in the Company’s revenues as evidenced by the following table:

Gross profit for the quarter ended September 30, 2025 was $558.7 million, an increase of $64.3 million, or 13.0%, compared to $494.4 million for the quarter ended September 30, 2024.

Gross margin improved 40 basis points to 54.4% in 2025 compared to 54.0% in 2024. We saw leverage across a number of cost categories, including 70 basis points of lower insurance and claims costs due to a more favorable claims experience and 10 basis points in materials and supplies. This was partially offset by 10 basis points of higher fleet expenses associated with lower vehicle gains and less favorable medical claims impacting people costs.

For the quarter ended September 30, 2025, sales, general and administrative ("SG&A") expenses were $301.4 million, an increase of $26.5 million, or 9.6%, compared to the quarter ended September 30, 2024.

As a percentage of revenue, SG&A decreased 60 basis points to 29.4% from 30.0% in the prior year, primarily due to 40 basis points of lower insurance and claims costs due to a more favorable claims experience, 10 basis points of lower selling and marketing costs, and 10 basis points of lower administrative costs.

For the quarter ended September 30, 2025, depreciation and amortization increased $4.6 million, or 16.5%, compared to the quarter ended September 30, 2024. The increase was due to higher amortization of intangible assets from acquisitions, most notably from the acquisition of Saela Pest Control ("Saela").

For the quarter ended September 30, 2025, operating income increased $33.2 million, or 17.3%, compared to the prior year.

As a percentage of revenue, operating income was 21.9%, an increase of 100 basis points compared to the third quarter of 2024. Operating margin improved mostly due to lower insurance and claims costs and leverage in materials and supplies, administrative costs, and selling and marketing costs, partially offset by higher fleet costs.

During the quarter ended September 30, 2025, interest expense, net increased $0.8 million compared to the prior year primarily due to a higher average debt balance during the quarter ended September 30, 2025 versus the same quarter in the prior year.

During the quarter ended September 30, 2025, other income decreased $0.2 million primarily due to lower gains on non-operational asset sales.

The Company’s effective tax rate was 24.8% in the third quarter of 2025 and 26.1% in the third quarter of 2024. The reduced rate is primarily due to the purchase of transferable federal income tax credits during the three months ended September 30, 2025.

(1) Exclusive of depreciation and amortization

(2) Amounts are non-GAAP financial measures. See "Non-GAAP Financial Measures" of this Form 10-Q for a discussion of non-GAAP financial metrics including a reconciliation to the most closely correlated GAAP measure.

The following table presents financial information, including our significant expense categories, for the nine months ended September 30, 2025 and 2024: