Rollins' fourth quarter saw a negative market reaction following results that missed Wall Street’s expectations for both revenue and non-GAAP profit. Management attributed the underperformance primarily to early winter weather in the Midwest and Northeast, which sharply reduced demand for one-time and seasonal pest control projects. CEO Jerry Gahlhoff described the impact as “choppy,” noting that while recurring and ancillary services grew more than 7%, the one-time business declined almost 3% in the quarter. Management emphasized that underlying customer retention and demand trends remained healthy, suggesting the softness was transitory and not reflective of broader weakness.

Is now the time to buy ROL? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Rollins’s Q4 Earnings Call

• Timothy Michael Mulrooney (William Blair) asked about the health of recurring and ancillary business growth. CEO Jerry Gahlhoff pointed to strong customer retention, improved close rates, and Orkin’s net customer gains as evidence of stable underlying demand.

• Manav Patnaik (Barclays) pressed for detail on one-time revenue segment margins and guidance for Q1. CFO Kenneth Krause explained that one-time projects have higher margins and indicated Q1 may also start slower due to weather but reaffirmed the 7%–8% growth outlook.

• Ashish Sabadra (RBC Capital Markets) questioned the drivers behind margin improvement in 2026. Krause cited pricing power, improved new hire retention, and reduced fleet costs as key tailwinds for margins.

• Jason Haas (Wells Fargo) inquired about changes to digital marketing strategy and the conversion of one-time customers. Gahlhoff explained ongoing digital cost pressures and emphasized the company’s diversified customer acquisition channels.

• Peter Jacob Keith (Piper Sandler) asked about incremental EBITDA margin weakness and IT investments. Krause attributed the margin impact to lower volumes and fleet costs, and noted ongoing discussions about leveraging AI and CRM upgrades for better cross-brand collaboration.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will monitor (1) the pace of recurring and ancillary service growth and customer retention, (2) the recovery of one-time revenue as weather normalizes, and (3) progress in cross-brand collaboration and ancillary service expansion. Developments in M&A activity, operational system upgrades, and the ability to manage cost pressures—particularly around staffing and fleet—will also be key indicators of Rollins’ execution against its growth strategy.

Rollins currently trades at $59.82, down from $65.60 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).

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