ADI Global Distribution at Jefferies conference: growth, but near-term pressure

On September 10, 2026, ADI Global Distribution (OSK) shared its business outlook at the Jefferies Global Industrials Conference. CEO Rob Aarnes reported growth and simplification, while cautioning about near-term challenges. The distributor, now independent after separating from Resideo, is pursuing the One ADI program to cut costs by over $80 million by the end of 2027.

Commercial demand remains the primary growth engine, while residential AV demand is soft and expected to remain weak through 2027 and 2028. Gross margins face uneven trends, with 2026 likely to see headwinds after 2025 gains from tariff benefits. ADI aims to reduce leverage from 3X to 2X, with its debt-to-equity ratio at 0.24. The company, valued at roughly $9.1 billion with a P/E ratio of 17, reported a 30% increase in e-commerce revenue since its spin-off from Honeywell in 2018.

ADI's main focus is on cost reduction through initiatives like reducing distribution centers, store locations, exclusive brands, and ERP systems. The company's outlook for the next several years targets 4% to 6% organic revenue growth through 2030, with commercial growth outpacing residential growth.