Facility services provider ABM Industries (NYSE: ABM) reported revenue ahead of Wall Street’s expectations in Q4 CY2025, with sales up 6.1% year on year to $2.24 billion. Its non-GAAP profit of $0.83 per share was 4.8% below analysts’ consensus estimates.

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“ABM is off to a solid start to fiscal 2026, delivering strong organic revenue growth of 5.5% and meaningful improvement in operating cash flow and free cash flow,” said Scott Salmirs, President and Chief Executive Officer.

Company Overview

With roots dating back to 1909 as a window washing company, ABM Industries (NYSE: ABM) provides integrated facility management, infrastructure, and mobility solutions across various sectors including commercial, manufacturing, education, and aviation.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years.

With $8.87 billion in revenue over the past 12 months, ABM is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions.

As you can see below, ABM’s sales grew at a solid 8.6% compounded annual growth rate over the last five years. This shows it had high demand, a useful starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. ABM’s recent performance shows its demand has slowed as its annualized revenue growth of 4.2% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

We can dig further into the company’s sales dynamics by analyzing its organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, ABM’s organic revenue averaged 3.6% year-on-year growth. Because this number aligns with its two-year revenue growth, we can see the company’s core operations (not acquisitions and divestitures) drove most of its results.

This quarter, ABM reported year-on-year revenue growth of 6.1%, and its $2.24 billion of revenue exceeded Wall Street’s estimates by 2.1%.

Looking ahead, sell-side analysts expect revenue to grow 4.5% over the next 12 months, similar to its two-year rate. This projection doesn't excite us and implies its newer products and services will not accelerate its top-line performance yet.

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Operating Margin

ABM’s operating margin has more or less stayed the same over the last 12 months , averaging 3.6% over the last five years. This profitability was lousy for a business services business and caused by its suboptimal cost structure.

Looking at the trend in its profitability, ABM’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, ABM generated an operating margin profit margin of 3.3%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

ABM’s EPS grew at a weak 2.1% compounded annual growth rate over the last five years, lower than its 8.6% annualized revenue growth. However, its operating margin didn’t change during this time, telling us that non-fundamental factors such as interest and taxes affected its ultimate earnings.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For ABM, its two-year annual EPS declines of 2.4% show it’s continued to underperform. These results were bad no matter how you slice the data.

In Q4, ABM reported adjusted EPS of $0.83, down from $0.87 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects ABM’s full-year EPS of $3.39 to grow 20%.

Key Takeaways from ABM’s Q4 Results

We enjoyed seeing ABM beat analysts’ organic revenue expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its EPS missed. Overall, this was a mixed quarter. The stock traded up 2.4% to $44.34 immediately following the results.

Big picture, is ABM a buy here and now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).