Alliance Laundry (NYSE:ALH) executives highlighted double-digit revenue and profit growth in 2025, margin expansion, and a sharp reduction in leverage during the company’s fourth-quarter and full-year 2025 earnings call. Management also introduced 2026 guidance calling for continued above-market growth and further deleveraging, while emphasizing ongoing investment in innovation, manufacturing efficiency, and digital capabilities.
2025 results: revenue growth, record margins, and deleveraging
CEO Mike Schoeb said 2025 was a “landmark year,” pointing to the company’s position in what he described as a replacement-driven and essential commercial laundry industry. For the full year, Alliance reported total revenue of $1.7 billion, up 13% year-over-year, and Adjusted EBITDA growth of 14%, with a record full-year Adjusted EBITDA margin of 25.5%. Schoeb said nearly all of the growth in the quarter and full year was organic.
CFO Dean Nolden said the company ended the year with total debt of $1.4 billion (down from $2.1 billion at the start of the year) and cash of $123 million. Net leverage fell to 2.8x Adjusted EBITDA, which he characterized as a reduction of 2.2 turns in a single year. Nolden attributed about one turn of the deleveraging to cash from operations and EBITDA expansion, with the remainder funded by IPO proceeds.
Fourth-quarter performance: volume-led growth and margin expansion
Nolden said fourth-quarter net revenue increased 10% year-over-year to $435 million, with unit volumes contributing about half of the growth and price accounting for the balance. Fourth-quarter gross profit rose 16% to $161 million, or 37% of revenue, as gross margin expanded 190 basis points from the prior year. Nolden said the improvement was driven by volume and cost-down initiatives and supported by pricing actions that largely offset an approximate $5 million tariff impact during the quarter.
Operating expenses were $97 million, or 22.4% of revenue, including a $16 million non-cash charge tied to performance-based option vesting related to the IPO. Excluding that item, Nolden said operating expenses as a percentage of revenue were consistent with expectations and reflected the full-quarter impact of public company costs and investments in commercial, engineering, and digital capabilities.
Adjusted EBITDA increased 17% to $107 million, representing 24.5% of revenue, and adjusted net income rose 18% to $49 million, excluding IPO-related option vesting and other non-operating or non-recurring items. Nolden said the adjusted net income improvement was driven by operating performance and lower interest expense following debt reduction actions.
Nolden also discussed tax items, saying the fourth-quarter effective tax rate was 35.6% and the full-year rate was 26.3%. He said those figures were elevated due to approximately $4 million in discrete non-cash charges primarily related to the transition to public company status and a valuation allowance increase against certain foreign tax credits. Excluding those items, he said the comparable fourth-quarter and full-year rates would have been 21.4% and 23.5%, respectively.
Segment trends: broad-based strength in North America and International
In North America, fourth-quarter revenue increased 9% to $317 million, while Adjusted EBITDA rose 15% to $88 million. Segment margin increased to 27.9%. Nolden said growth was broad-based across vended markets, on-premise, and commercial and home products. He attributed vended market growth to new store development and modernization toward higher-capacity, digitally connected equipment.
International fourth-quarter revenue rose 12% to $118 million, while Adjusted EBITDA increased 25% to $29 million, with margin expanding 260 basis points to 24.8%. Nolden cited a mix benefit from a growing European business and operating leverage as international scale increased. He said Europe’s momentum was supported by operator investment in fleet upgrades and energy efficiency, while in Asia-Pacific the newly launched Stax-X stacked washer-dryer has been well received with early adoption.
For the full year, North America revenue was $1.3 billion and Adjusted EBITDA was $361 million, both up 14% year-over-year, with a segment EBITDA margin of 28.5%. International revenue increased 10% to $440 million and Adjusted EBITDA rose 17% to $121 million; international EBITDA margin was 27.4%, up 160 basis points.
Nolden said Europe was a “standout performer” during 2025, driven by the company’s Speed Queen licensed store strategy and direct sales offices in the region. He also said the company’s “local-for-local” manufacturing strategy—plants in the U.S., Europe, and two in Asia primarily serving home markets—provided “significant structural tariff protection,” with modest impacts from certain imported components largely offset through selective pricing actions in 2025.
Innovation, digital adoption, and recent distributor acquisitions
Schoeb highlighted a number of initiatives that management said supported performance in 2025, including product and digital launches. He cited the expansion of ProCapture, a patented lint filtration system, and the launch of the T55 Stacked Tumbler, which he described as the industry’s largest stacked dryer. Schoeb also pointed to Scan-Pay-Wash, a cashless payment solution requiring no app download, which he said has processed more than a third of a million transactions to date. In Asia, he highlighted early demand for Stax-X, developed at the company’s Thailand engineering center.
Schoeb said Alliance’s global test lab teams conducted over 5 million hours of physical product testing in 2025 and that testing hours will increase significantly in 2026 as new facilities in Thailand and the Czech Republic ramp up.
He also said the company expanded its direct business in the fourth quarter by acquiring one New York-based distributor, and added that an additional acquisition in the same market closed “just last week.” In response to analyst questions, Schoeb described the New York metro area as a market where the company saw opportunity to deepen its presence, while emphasizing the company does not need acquisitions to grow above market and will remain selective and opportunistic.
2026 guidance: continued growth, investment, and lower leverage
Management introduced 2026 guidance calling for revenue growth of approximately 5% to 7% and Adjusted EBITDA growth of approximately 6% to 8%, implying continued margin expansion despite incremental public company costs. Schoeb said the revenue growth expectation is split roughly evenly between volume and price. Nolden said the outlook reflects normalization from benefits tied to customers returning after 2022–2023 profitability initiatives, the recent outperformance of commercial and home, and moderation of tariff-related pricing.
Nolden provided additional modeling assumptions for 2026, including:
- CapEx of approximately 3% of revenue
- Effective tax rate of approximately 23.5%
- Total interest expense of approximately $85 million
- Diluted share count of approximately 205 million shares
On cadence, Nolden said year-over-year revenue growth is expected to be stronger in the first half of 2026 due to pricing carryover from 2025, with volume growth more consistent throughout the year. He said margin expansion in 2026 is anticipated to be weighted toward the back half of the year, in part because incremental public company costs—about $8 million—are more heavily weighted toward the first half.
Regarding leverage, Nolden said the company expects to reduce leverage by approximately three-quarters of a turn in 2026, targeting a net leverage ratio in the low 2x range by year-end. He reiterated deleveraging as the top capital allocation priority, while also outlining continued investment in growth initiatives and the potential to consider share repurchases “in the nearer term” and a potential dividend policy “over the longer term.”
During Q&A, management said it was seeing strong demand broadly, while Schoeb noted volatility in the Middle East could be a weaker area near term. He said Alliance expects no change in tariff policy in its planning assumptions and characterized the company as “ready to react” if conditions change. Executives also said steel costs were “locked” and that pricing actions taken in 2025 more than offset cost increases and tariff impacts, describing those actions as both margin- and dollar-accretive.
About Alliance Laundry (NYSE:ALH)
Alliance Laundry Systems (NYSE: ALH) is a manufacturer and distributor of commercial and residential laundry equipment and related services. The company designs, produces and sells a range of coin-operated and vended machines, on-premises washers and dryers, and allied equipment for laundromats, multi-housing, hospitality, healthcare and other institutional customers. Alliance’s product strategy emphasizes durable, high-throughput machines for professional laundry operators as well as appliances geared to self-service and multi-dwelling applications.
Its product portfolio includes coin-operated and card-operated washers and dryers, stacked and single-pocket models, industrial-grade on-premises equipment, and parts and accessories.
