Waste Management Inc.
10/27/2025 | Press release | Distributed by Public on 10/27/2025 14:40
WM Delivers Double-Digit Growth in Cash Flow from Operations Led by Disciplined Growth, Strong Cost Optimization, and Expansion of its Sustainability Businesses (Form 8-K)
WM Delivers Double-Digit Growth in Cash Flow from Operations Led by Disciplined Growth, Strong Cost Optimization, and Expansion of its Sustainability Businesses
WM Advances its Sustainability Investments with Completion of Two New Renewable Natural Gas Facilities and Two Recycling Projects
Houston - October 27, 2025 - WM (NYSE: WM) today announced financial results for the quarter ended September 30, 2025.
| Three Months Ended | Three Months Ended | |||||||||||||||
| September 30, 2025 | September 30, 2024 | |||||||||||||||
| (in millions, except per share amounts) | (in millions, except per share amounts) | |||||||||||||||
| As Reported | As Adjusted(a) | As Reported | As Adjusted(a) | |||||||||||||
| Revenue | $ | 6,443 | $ | 6,443 | $ | 5,609 | $ | 5,609 | ||||||||
| Income from Operations | $ | 989 | $ | 1,241 | $ | 1,119 | $ | 1,153 | ||||||||
| Operating EBITDA(b) | $ | 1,718 | $ | 1,970 | $ | 1,677 | $ | 1,711 | ||||||||
| Operating EBITDA Margin | 26.7 | % | 30.6 | % | 29.9 | % | 30.5 | % | ||||||||
| Net Income(c) | $ | 603 | $ | 801 | $ | 760 | $ | 790 | ||||||||
| Diluted EPS | $ | 1.49 | $ | 1.98 | $ | 1.88 | $ | 1.96 | ||||||||
"Our third quarter results highlight momentum in WM's earnings growth and free cash flow conversion, which is driven by our strong operating platform, diverse and growing customer base, and expanding sustainability businesses," said Jim Fish, WM's CEO. "Our Collection and Disposal business delivered record-setting margin this quarter, underscoring the strength of our industry-leading asset network, strategic investments in technology, and disciplined pricing programs. We also achieved adjusted operating EBITDA growth in both our Recycling Processing and Sales and Renewable Energy segments despite commodity price headwinds, underscoring the value of our sustainability investments. Additionally, we continued to advance the integration of WM Healthcare Solutions, enhancing the breadth and value of services we offer to our customers. Strong results across all aspects of our business reinforce our confidence in achieving our full-year earnings and free cash flow guidance, as well as our long-term financial objectives and strategic priorities."(a)
KEY HIGHLIGHTS FOR the Third Quarter OF 2025(d)
Operating EBITDA
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Third Quarter 2025 ($ in millions) |
Third Quarter 2024 ($ in millions) |
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Total Company Breakout |
As Adjusted(a) |
Total Company Breakout |
As Adjusted(a) | |||||||||||||||||||||||||||||
| Amount | Margin | Amount | Margin | Amount | Margin | Amount | Margin | |||||||||||||||||||||||||
| WM Legacy Business(e) | $ | 1,629 | 28.0 | % | $ | 1,860 | 32.0 | % | $ | 1,677 | 29.9 | % | $ | 1,711 | 30.5 | % | ||||||||||||||||
| WM Healthcare Solutions | 89 | 14.2 | % | 110 | 17.5 | % | - | - | - | - | ||||||||||||||||||||||
| Total Company | $ | 1,718 | 26.7 | % | $ | 1,970 | 30.6 | % | $ | 1,677 | 29.9 | % | $ | 1,711 | 30.5 | % | ||||||||||||||||
| · | Adjusted operating EBITDA for the WM Legacy Business grew 8.7%.(a) The Company's Collection and Disposal business led the way with an operating EBITDA margin of 37.5%, or 38.4% on an adjusted basis, driven by continuous improvements in technology, strategic asset network utilization, and focus on disciplined price-cost spread.(a) |
Revenue
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Third Quarter 2025 ($ in millions) |
Third Quarter 2024 ($ in millions) |
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| Amount | Growth | Amount | Growth | |||||||||||||
| WM Legacy Business(e) | $ | 5,815 | 3.7 | % | $ | 5,609 | 7.9 | % | ||||||||
| WM Healthcare Solutions(f) | 628 | N/A | - | - | ||||||||||||
| Total Company | $ | 6,443 | 14.9 | % | $ | 5,609 | 7.9 | % | ||||||||
| · | Revenue growth in the WM Legacy Business was driven by Collection and Disposal core price of 6.0% and yield of 3.8% as the Company continues to focus on maximizing customer lifetime value.(g) |
| · | Volumes in the Collection and Disposal business grew 0.2% as compared to the third quarter of 2024, driven by strong landfill volumes and growth in industrial collection volumes. This growth was partially offset by a decline in residential collection volumes due to the strategic exit of lower-margin contracts. |
| · | A revenue decline of $60 million in the Recycling Processing and Sales segment was driven by lower market prices for recycled commodities. The Company's blended average price for single stream commodities declined nearly 35% from the prior year quarter.(h) |
| · | WM Healthcare Solutions revenue was slightly below expectations. The Company is taking a disciplined approach to customer engagement and prioritizing customer lifetime value, resulting in the deferral of some planned price increases. |
Operating Expenses
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Third Quarter 2025 ($ in millions) |
Third Quarter 2024 ($ in millions) |
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Total Company Breakout |
As Adjusted(a) |
Total Company Breakout |
As Adjusted(a) | |||||||||||||||||||||||||||||
| Amount | Margin | Amount | Margin | Amount | Margin | Amount | Margin | |||||||||||||||||||||||||
| WM Legacy Business(e) | $ | 3,430 | 59.0 | % | $ | 3,430 | 59.0 | % | $ | 3,399 | 60.6 | % | $ | 3,399 | 60.6 | % | ||||||||||||||||
| WM Healthcare Solutions(f) | 403 | 64.2 | % | 400 | 63.7 | % | - | - | - | - | ||||||||||||||||||||||
| Total Company | $ | 3,833 | 59.5 | % | $ | 3,830 | 59.4 | % | $ | 3,399 | 60.6 | % | $ | 3,399 | 60.6 | % | ||||||||||||||||
| · | Adjusted operating expenses as a percentage of revenue for the WM Legacy Business improved 160 basis points, reflecting the benefits of improved driver retention and the Company's disciplined cost focus, the strategic exit from low-margin residential collection business, strong municipal solid waste and special waste landfill volumes, and the benefit of capital investments made in the fleet and automation of recycling facilities.(a) |
SG&A Expenses
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Third Quarter 2025 ($ in millions) |
Third Quarter 2024 ($ in millions) |
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Total Company Breakout |
As Adjusted(a) |
Total Company Breakout |
As Adjusted(a) | |||||||||||||||||||||||||||||
| Amount | Margin | Amount | Margin | Amount | Margin | Amount | Margin | |||||||||||||||||||||||||
| WM Legacy Business(e) | $ | 536 | 9.2 | % | $ | 523 | 9.0 | % | $ | 525 | 9.4 | % | $ | 499 | 8.9 | % | ||||||||||||||||
| WM Healthcare Solutions | 129 | 20.5 | % | 120 | 19.1 | % | - | - | - | - | ||||||||||||||||||||||
| Total Company | $ | 665 | 10.3 | % | $ | 643 | 10.0 | % | $ | 525 | 9.4 | % | $ | 499 | 8.9 | % | ||||||||||||||||
| · | Adjusted SG&A results in the WM Legacy Business reflect the Company's ongoing commitment to cost discipline. |
| · | SG&A as a percentage of revenue for WM Healthcare Solutions improved 270 basis points sequentially, or 180 basis points on an adjusted basis, reflecting success in the Company's efforts to integrate and streamline its sales and back-office processes.(a) |
Cash Flow and Investments
| · | Through the first nine months of the year, the Company generated $4.35 billion of net cash provided by operating activities, an increase of 12.0% from the prior year. This growth has been driven by strong operating EBITDA and a decline in cash taxes. These increases were partially offset by higher cash interest, which is due to the debt funding of the Stericycle acquisition. |
| · | Free cash flow in the first nine months of the year was $2.11 billion, a 13.5% year-over-year increase, driven by robust operating EBITDA growth and a planned reduction in capital investment in sustainability growth projects as the Company moves from peak construction of this portfolio into a period of harvesting strong returns on these businesses. These increases in free cash flow were partially offset by higher capital expenditures to support the business, which includes the addition of WM Healthcare Solutions.(a) |
| · | The Company's leverage ratio continues to improve sequentially, driven by increased operating EBITDA and debt repayments. The Company remains on track to achieve its targeted leverage ratio of between 2.5 and 3.0 times by the middle of 2026.(i) |
Sustainability and WM Healthcare Solutions Update
| · | The Company continues to progress its strategic investments in recycling and renewable natural gas facilities that drive economic and environmental value. During the quarter, four growth projects commenced operations, including new renewable natural gas facilities in Texas and California, a new recycling facility in Texas, and a recycling automation project in California. These additions bring total renewable natural gas projects completed to 10 out of the original 20 planned facilities and total recycling automation and new market projects completed to 31 out of the original 39 planned. |
| · | During the quarter, the Company progressed its integration of the people and operations of WM Healthcare Solutions into the management and operating structure of its 16 geographic areas, advancing process optimization and alignment across the business. |
2025 Outlook
The Company is confident in its ability to deliver upon its full-year outlook ranges for adjusted operating EBITDA and free cash flow.
| · | The Company is affirming its adjusted operating EBITDA guidance of between $7.475 and $7.625 billion.(a) |
| · | Free cash flow guidance remains between $2.8 and $2.9 billion.(a) |
| · | Total Company revenue is now expected to be approximately $25.275 billion, which is at the low end of the Company's prior guidance range. The decrease from prior expectations is primarily related to a further decline in recycled commodity pricing as well as modestly lower revenue expectations from WM Healthcare Solutions.(h) |
| · | Projected adjusted operating EBITDA margin guidance has increased to between 29.6% and 30.2% from between 29.6% and 29.9% .(a) |
Fish concluded, "We are pleased with our results in the first three quarters of the year across our business segments, which position us to deliver another year of double-digit adjusted operating EBITDA growth with record margin in our Collection and Disposal business and expanding free cash flow conversion. Looking ahead, 2026 is setting up to be a year of outsized free cash flow growth, with results expected to approach $3.8 billion next year. Our disciplined approach to capital allocation remains unchanged, and we are committed to translating this performance into strong shareholder returns."(a)
| (a) | The information labeled as adjusted in this press release, as well as free cash flow, are non-GAAP measures. Please see "Non-GAAP Financial Measures" below and the reconciliations in the accompanying schedules for more information. |
| (b) | Management defines operating EBITDA as GAAP income from operations before depreciation, depletion and amortization; this measure may not be comparable to similarly titled measures reported by other companies. |
| (c) | For purposes of this press release, all references to "Net income" refer to the financial statement line item "Net income attributable to Waste Management, Inc." |
| (d) | All dollar amounts, unless otherwise noted, are presented in millions and rounded to the nearest million. Percentages are calculated using rounded figures and shown to one decimal place. Accordingly, percentage totals and subtotals may not sum to 100% due to rounding. |
| (e) | Management defines WM Legacy Business as total Company GAAP results excluding the WM Healthcare Solutions segment. |
| (f) | WM Healthcare Solutions includes intra-segment activity, with operating revenues and expenses of $108 million for the three months ended September 30, 2025. Inter-segment activity includes operating revenues of $2 million and operating expenses of $16 million for the same period. |
| (g) | Core price is a performance metric used by management to evaluate the effectiveness of our pricing strategies; it is not derived from our financial statements and may not be comparable to measures presented by other companies. Core price is based on certain historical assumptions, which may differ from actual results, to allow for comparability between reporting periods and to reveal trends in results over time. |
| (h) | The Company's blended average price received for single stream recycled commodities sold during the quarter was about $68 per ton compared to about $101 per ton in the prior year period. The Company now expects single stream commodity prices to average approximately $75 per ton in 2025, which is down from its prior expectation of $80 per ton. The average price received for Renewable Fuel Standard credits was $2.56 during the quarter compared to $3.08 in the prior year period. The average price received for natural gas was $2.46 per MMBtu during the quarter compared to $1.80 per MMBtu in the prior year period. The average price received for renewable electricity was about $73 per megawatt hour in the quarter compared to about $60 per megawatt hour in the prior year period. |
| (i) | Leverage ratio is calculated based on the defined terms for this financial covenant in the Company's revolving credit agreement, which is Exhibit 10.9 to the Company's Form 10-K filed Feb. 19, 2025. |
The Company will host a conference call at 10 a.m. ET on October 28, 2025, to discuss the Third Quarter 2025 results. Information contained within this press release will be referenced and should be considered in conjunction with the call.
Listeners can access a live audio webcast of the conference call by visiting investors.wm.com and selecting "Events & Presentations" from the website menu. A replay of the audio webcast will be available at the same location following the conclusion of the call.
Conference call participants should register to obtain their dial in and passcode details. This streamlined process improves security and eliminates wait times when joining the call.
about wm
WM (WM.com) is North America's leading provider of comprehensive environmental solutions. Previously known as Waste Management and based in Houston, Texas, WM is driven by commitments to put people first and achieve success with integrity. The company, through its subsidiaries, provides collection, recycling and disposal services to millions of residential, commercial, industrial, medical and municipal customers throughout the U.S. and Canada. With innovative infrastructure and capabilities in recycling, organics and renewable energy, WM provides environmental solutions to and collaborates with its customers in helping them pursue their sustainability goals. In North America, WM has the largest disposal network and collection fleet, is the largest recycler and is a leader in beneficial use of landfill gas, with a growing network of renewable natural gas plants and the most landfill gas-to-electricity plants, as well as the largest heavy-duty natural gas truck fleet in the industry. WM Healthcare Solutions provides collection and disposal services of regulated medical waste and secure information destruction services in the U.S., Canada and Western Europe. To learn more about WM and the company's sustainability progress and solutions, visit Sustainability.WM.com.
Waste Management Inc. published this content on October 27, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on October 27, 2025 at 20:41 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]