Financial Data and Key Metrics Changes - The company reported a third-quarter operating EBITDA growth of over 15% and free cash flow growth of nearly 33% [8] - Total company operating EBITDA margin reached 30.6%, the best quarterly result in history, with the legacy business achieving a margin of 32% [19][24] - Free cash flow for the first nine months of 2025 grew 13.5% to $2.11 billion, with operating EBITDA to free cash flow conversion approaching 42% [21][24] Business Line Data and Key Metrics Changes - The collection and disposal business contributed more than half of the year-over-year increase in operating EBITDA, with MSW and special waste volumes growing by 5% and 5.5% respectively [8][14] - Operating EBITDA margins in the collection and disposal business expanded by 100 basis points to a record 38.4%, with operating EBITDA growing more than 7% [14] - The healthcare solutions segment's operating EBITDA margin improved to 17.5% as integration efforts progressed [20] Market Data and Key Metrics Changes - The company experienced strong organic revenue growth driven by disciplined pricing and improving volume trends, with core price at 6% [15] - Landfill volumes rose by 5.2%, with broad strength across MSW, special waste, and construction and demolition [16] - Recycling segment's operating EBITDA grew by 18% despite a nearly 35% decline in recycled commodity prices [10] Company Strategy and Development Direction - The company is focused on maximizing customer lifetime value through pricing strategies and leveraging technology to optimize costs [9] - Strategic investments in technology and automation are expected to yield benefits in 2026, with free cash flow projected to approach $3.8 billion [11][12] - The company remains disciplined in capital allocation, expecting to translate performance into returns for shareholders [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term value of the healthcare solutions acquisition, despite a more measured revenue growth pace than initially projected [22][23] - The company anticipates achieving operating EBITDA and free cash flow guidance for the remainder of the year, with margin expectations raised to between 29.6% and 30.2% [24] - Management highlighted the importance of operational efficiency and customer relationships in driving future growth [18] Other Important Information - The company has returned $1 billion to shareholders in dividends and allocated over $400 million to solid waste acquisitions through the first three quarters of 2025 [22] - The CFO announced retirement plans, expressing confidence in the incoming CFO and the company's future [25] Q&A Session Summary Question: How much has the company benefited from one-time cleanup work at the landfill? - The company indicated that total revenues from wildfire volumes were around $115 million for the year, with a significant EBITDA growth in solid waste results without meaningful impacts from wildfires [30] Question: What were the charges this quarter related to the plastics film plant and landfill closure? - The plastics film plant was idled due to market conditions, while the landfill impairment was related to a long-term pursuit of expansion that was deemed no longer viable [32] Question: What factors will contribute to the expected free cash flow improvement in 2026? - The expected improvement will come from the wind-down of sustainability investments, strong performance from the legacy business, and contributions from healthcare solutions [33][35] Question: How is the healthcare solutions business performing regarding pricing increases? - The company is deferring price increases to ensure customer satisfaction and stabilize revenue, with confidence in achieving mid-single-digit revenue growth in the long term [58][65] Question: What is the outlook for yield and pricing in 2026? - The company is optimistic about maintaining a good spread between core price and operating expenses, with strong performance expected in the collection and disposal business [70][72]

Financial Data and Key Metrics Changes - The company reported a third-quarter operating EBITDA growth of over 15% and free cash flow growth of nearly 33% [6][10] - Total company operating EBITDA margin reached 30.6%, the best quarterly result in history, while the legacy business achieved a margin of 32% [18][19] - Free cash flow for the first nine months of 2025 grew 13.5% to $2.11 billion, with operating EBITDA to free cash flow conversion approaching 42% [20][21] Business Line Data and Key Metrics Changes - The collection and disposal business contributed more than half of the year-over-year increase in operating EBITDA, with MSW and special waste volumes growing by 5% and 5.5% respectively [6][12] - Operating EBITDA margins in the collection and disposal business expanded by 100 basis points to a record 38.4%, with every line of business contributing to growth [12][14] - The healthcare solutions segment's operating EBITDA margin improved to 17.5%, reflecting successful integration efforts [19][23] Market Data and Key Metrics Changes - The company experienced solid organic revenue growth driven by disciplined pricing and improving volume trends, with core price at 6% [13][14] - Landfill volumes rose by 5.2%, with broad strength across MSW, special waste, and construction and demolition [14][48] - Despite a nearly 35% decline in recycled commodity prices, the recycling segment's operating EBITDA grew by 18% [9][20] Company Strategy and Development Direction - The company is focused on maximizing customer lifetime value through pricing strategies and technology optimization [6][7] - Investments in technology and automation, as well as in new recycling and renewable natural gas facilities, are expected to yield benefits in 2026 [10][11] - The company remains disciplined in capital allocation, expecting to return significant value to shareholders through dividends and potential share repurchases [21][79] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term value of the healthcare solutions acquisition, despite a more measured revenue growth pace than initially projected [21][23] - The company anticipates a strong fourth quarter, driven by improved execution and a robust post-collection network [50][51] - Management highlighted the importance of customer-centric strategies and operational efficiencies in driving future growth [62][64] Other Important Information - The company has returned $1 billion to shareholders in dividends and allocated over $400 million to solid waste acquisitions [21] - The CFO announced retirement plans, expressing confidence in the incoming CFO and the company's future [24][25] Q&A Session Summary Question: How much have you benefited from one-time cleanup work at the landfill? - The company indicated that total revenues from wildfire volumes were around $115 million for the year, with a significant EBITDA growth in solid waste results without meaningful impacts from wildfires [29][30] Question: Can you clarify the charges this quarter? - The landfill impairment was due to a long-term pursuit of expansion that was deemed no longer viable, leading to recorded impairments [31][32] Question: What are the expectations for 2026 free cash flow? - The company expects free cash flow to approach $3.8 billion, driven by a wind-down of sustainability investments and strong performance from the legacy business [10][33] Question: How is the healthcare solutions business performing? - The healthcare solutions business is experiencing some churn but has renewed nearly $200 million worth of business, indicating strong customer retention and growth potential [81] Question: What is the outlook for M&A activity? - The company anticipates a normal M&A pipeline of $100 million to $200 million for 2026, with ongoing integration of the healthcare solutions business [77][79]

Core Insights - The company reported Q3 2025 revenue of $6.44 billion, a 14.9% increase year over year, but net income decreased by 20.7% to $603 million [1] - Operating EBITDA was $1.72 billion, reflecting a 2.5% year-over-year growth with an adjusted margin of 30.6% [1] Financial Performance - CEO Jim Fish highlighted expanded margins and reduced operating costs due to technology and fleet automation [1] - Core price increased by 6%, and landfill volumes rose by 5.2%, driven by MSW, special waste, and construction categories [1] - The collection and disposal business contributed significantly to the year-over-year increase in operating earnings, achieving a 32% EBITDA margin in the legacy business [1] Sector Challenges - Healthcare Solutions revenue was $628 million, slightly below expectations, as the company integrates Stericycle and its ERP system [1] - The segment faced customer frustrations with billing and reporting, leading to credits or deferred price increases [1] Operational Adjustments - The closure of the Natura PCR facility in Texas resulted in a $152 million impairment charge due to unfavorable market conditions [1] - Recycled commodity prices fell nearly 35% year over year, yet the recycling segment's operating EBITDA grew by 18% due to MRF automation investments [1] Renewable Natural Gas (RNG) Developments - The company doubled its RNG production in the first nine months of the year and pre-sold about 45% of its 2026 offtake [2] - RIN prices for 2026 are projected to be in the $220 to $230 range [2] M&A Activity - The company has completed approximately $450 million in deals this year, with expectations to reach $500 million by year-end [2] - Future transactions may close in Q4 or roll into next year, with a return to a normal range of $100 million to $200 million expected in 2026 [2] Revised Guidance - The company maintains its full-year growth expectations for operating EBITDA and free cash flow, with revenue projected at the low end of the previous guidance range of $25.275 billion to $25.475 billion [2] - Margin expectations have increased to between 29.6% and 30.2% [2]

Market Overview - U.S. stock futures showed mixed movements following a positive trading session on Monday, where benchmark indices reached new records due to successful trade negotiations with China [1] - The Federal Reserve is expected to announce a decision on interest rates, with a 97.8% likelihood of a cut in the October meeting [2] - Major indices' futures showed slight declines for Dow Jones and S&P 500, while Nasdaq 100 saw a minor increase [2] Company Earnings and Performance - United Parcel Service (UPS) is expected to report earnings of $1.31 per share on revenue of $20.83 billion, with a short-term stronger price trend but weaker medium and long-term trends [5] - UnitedHealth Group (UNH) anticipates earnings of $2.81 per share on revenue of $113.06 billion, showing a strong medium and short-term price trend but weaker long-term performance [5] - Cameco Corp. (CCJ) rose 9.67% and Brookfield Asset Management (BAM) advanced 3.52% after announcing a partnership with the U.S. Government for $80 billion in new nuclear reactors, maintaining a strong price trend [5] - 3D Systems Corp. (DDD) gained 9.45% due to significant milestones in its Saudi joint venture, indicating a strong price trend across all time frames [5] - Waste Management Inc. (WM) shares dropped 2.51% after reporting weaker-than-expected third-quarter results, maintaining a poor growth ranking [6] Sector Performance - Information technology, communication services, and consumer discretionary sectors recorded the biggest gains, contributing to a positive close for most sectors on the S&P 500 [7] - Consumer staples and materials sectors, however, closed lower, bucking the overall market trend [7] Analyst Insights - Professor Jeremy Siegel highlighted robust corporate profits as a key driver for the market, expecting a 25-basis point cut from the Federal Open Market Committee [9] - Siegel noted that earnings are strong and the real economy looks good, despite some tariff-related price noise being temporary [10] - Cautious market sentiment persists, with positioning remaining hedged and skeptical, which Siegel views as a healthy sign for future growth [11]

Market Overview - U.S. stock futures showed mixed movements following a positive trading session on Monday, where benchmark indices reached new records due to successful trade negotiations with China [1] - The Federal Reserve is expected to announce a decision on interest rates, with a 97.8% likelihood of a cut in the October meeting [2] - Major indices' futures showed slight declines for Dow Jones and S&P 500, while Nasdaq 100 saw a minor increase [2] Company Earnings and Performance - United Parcel Service (UPS) is expected to report earnings of $1.31 per share on revenue of $20.83 billion, with a short-term strong price trend but weak medium and long-term trends [5] - UnitedHealth Group (UNH) anticipates earnings of $2.81 per share on revenue of $113.06 billion, showing a strong medium and short-term price trend but weaker long-term performance [5] - Cameco Corp. (CCJ) rose 9.67% and Brookfield Asset Management (BAM) advanced 3.52% after announcing a partnership with the U.S. Government for $80 billion in new nuclear reactors, maintaining a strong price trend [5] - 3D Systems Corp. (DDD) gained 9.45% due to significant milestones in its Saudi joint venture, indicating a strong price trend across all time frames [5] - Waste Management Inc. (WM) shares fell 2.51% after reporting weaker-than-expected third-quarter results, maintaining a poor growth ranking [6] Sector Performance - Information technology, communication services, and consumer discretionary sectors recorded the biggest gains, contributing to a positive close for most sectors on the S&P 500 [7] - Consumer staples and materials sectors, however, closed lower, bucking the overall market trend [7] Analyst Insights - Professor Jeremy Siegel highlighted robust corporate profits as a key driver for the market, expecting a 25-basis point cut from the Federal Open Market Committee [9] - Siegel noted that earnings are strong and the real economy looks good, despite some tariff-related price noise being temporary [10] - Sentiment remains cautious, with positioning still hedged, which Siegel views as a healthy sign for the market's future [11]

Group 1 - The core point of the article is that Waste Management (WM.US) reported disappointing third-quarter earnings, leading to a pre-market drop in stock price [1] - The company reported third-quarter revenue of $6.44 billion, which was below the FactSet estimate of $6.50 billion [1] - Adjusted earnings per share for the third quarter were $1.98, falling short of the IBES estimate of $2.02 [1] Group 2 - The company has lowered its full-year revenue forecast to the lower end of previous predictions due to a further decline in recycling commodity prices [1] - The stock closed at $213.77, down 0.41%, and pre-market trading showed a drop of 2.81% to $207.76 [1] - The company's market capitalization stands at $86.11 billion, with a 52-week high of $240.84 and a low of $197.52 [1]

Core Insights - Waste Management (WM) reported revenue of $6.44 billion for the quarter ended September 2025, reflecting a year-over-year increase of 14.9% [1] - Earnings per share (EPS) for the quarter was $1.98, slightly up from $1.96 in the same quarter last year [1] - The reported revenue fell short of the Zacks Consensus Estimate of $6.49 billion, resulting in a surprise of -0.71% [1] - EPS also missed the consensus estimate of $2.01, with a surprise of -1.49% [1] Financial Performance Metrics - Internal Revenue Growth (Total) was 14.9%, compared to the average estimate of 15.8% from six analysts [4] - Internal Revenue Growth (Volume) was 0.8%, exceeding the average estimate of 0.4% from four analysts [4] - Internal Revenue Growth (Internal) was 3%, below the average estimate of 4.9% from four analysts [4] - Internal Revenue Growth (Acquisitions) was 11.9%, surpassing the average estimate of 10.5% from three analysts [4] - Total average yield was 2.2%, significantly lower than the average estimate of 5.6% from two analysts [4] Segment Performance - Operating revenues from WM Renewable Energy were $115 million, below the average estimate of $129.5 million, but showed a year-over-year increase of 32.2% [4] - Operating revenues from WM Healthcare Solutions reached $628 million, exceeding the estimated $587.33 million [4] - Operating revenues from Recycling Processing and Sales were $372 million, falling short of the estimated $395.44 million, representing a year-over-year decline of 13.9% [4] - Operating revenues from Corporate and Other were $7 million, above the average estimate of $5.7 million, with a year-over-year increase of 16.7% [4] Stock Performance - Shares of Waste Management have returned -1.8% over the past month, while the Zacks S&P 500 composite increased by 2.5% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - Waste Management (WM) reported quarterly earnings of $1.98 per share, missing the Zacks Consensus Estimate of $2.01 per share, but showing an increase from $1.96 per share a year ago, resulting in an earnings surprise of -1.49% [1] - The company posted revenues of $6.44 billion for the quarter ended September 2025, which was below the Zacks Consensus Estimate by 0.71%, but an increase from $5.61 billion year-over-year [2] - Waste Management shares have increased by approximately 6.4% since the beginning of the year, underperforming compared to the S&P 500's gain of 15.5% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.00 on revenues of $6.48 billion, and for the current fiscal year, it is $7.55 on revenues of $25.36 billion [7] - The estimate revisions trend for Waste Management was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Waste Removal Services industry, to which Waste Management belongs, is currently ranked in the bottom 36% of over 250 Zacks industries, suggesting potential challenges for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Waste Management reported a miss on both earnings per share (EPS) and revenue, leading to a downward revision of its full-year guidance to the low end due to ongoing weakness in the recycling sector [1] Financial Performance - The company experienced a decline in EPS and revenue, indicating challenges in its operational performance [1] - Full-year guidance has been adjusted to reflect a more conservative outlook, particularly influenced by the recycling market's struggles [1] Industry Context - The recycling sector is facing significant challenges, which have adversely impacted Waste Management's financial results [1] - The overall industry may be experiencing similar pressures, suggesting a broader trend affecting waste management and recycling services [1]

Revenue Performance - Total revenue for Q3 2025 was $6,443 million, representing a 14.9% increase from $5,609 million in Q3 2024[2] - Operating revenues for Q3 2025 reached $6,443 million, a 14.8% increase from $5,609 million in Q3 2024[26] - Total operating revenues for the three months ended September 30, 2025, were $7,908 million, a decrease of 1,465 million compared to $6,443 million in 2024[32] - Gross operating revenues for the three months ended September 30, 2025, totaled $7,170 million, compared to $6,840 million in the same period of 2024, marking an increase of 4.8%[50] - Reported gross operating revenues for the three months ended September 30, 2025, were $7,170 million, compared to $6,840 million for the same period in 2024, representing a year-over-year increase of 4.8%[53] EBITDA and Profitability - Adjusted operating EBITDA for the WM Legacy Business grew 8.7%, with a margin of 28.0% in Q3 2025 compared to 29.9% in Q3 2024[4] - The Collection and Disposal business achieved an operating EBITDA margin of 37.5%, driven by technology improvements and disciplined pricing[4] - The company is affirming its adjusted operating EBITDA guidance of between $7.475 and $7.625 billion for 2025[11] - Adjusted operating EBITDA for the three months ended September 30, 2025, was $1,970 million, with an adjusted operating EBITDA margin of 30.6%[48] - Recycling commodity rebates contributed $177 million to adjusted operating EBITDA for the three months ended September 30, 2025, with a margin change of 0.8%[59] Cash Flow and Liquidity - Free cash flow for the first nine months of 2025 was $2.11 billion, a 13.5% year-over-year increase[12] - Free cash flow for the nine months ended September 30, 2025, was $4,345 million, up from $3,879 million in 2024, indicating improved liquidity[30] - Free cash flow for the three months ended September 30, 2025, was $821 million, up from $618 million in 2024[42] - The company projected free cash flow for 2025 to be between $2,800 million and $2,900 million, with capital expenditures supporting the business estimated at $2,575 million to $2,625 million[53][54] - The company reported a net cash provided by operating activities of $5,860 million for the projected free cash flow scenario[53] Income and Earnings - Consolidated net income for the nine months ended September 30, 2025, was $1,967 million, compared to $2,147 million for the same period in 2024, reflecting a decrease of 8.4%[30] - Basic earnings per common share for Q3 2025 were $1.50, compared to $1.89 in Q3 2024, reflecting a decrease of 20.6%[26] - The company reported a net income of $603 million for the three months ended September 30, 2025, compared to $760 million in the same period of 2024, a decrease of 20.7%[48] Expenses and Cost Management - Operating expenses as a percentage of revenue for the WM Legacy Business improved by 160 basis points, reflecting cost discipline[6] - Adjusted SG&A expenses for the three months ended September 30, 2025, were $643 million, which is 10.0% of net revenues, compared to $499 million or 8.9% in 2024[53] - Adjusted operating expenses for the three months ended September 30, 2025, were $3,830 million, which is 59.4% of net revenues, compared to $3,399 million or 60.6% in 2024[53] - The adjusted operating expenses margin for the three months ended September 30, 2025, was 59.0%, down from 60.6% in 2024[53] Assets and Liabilities - Total assets as of September 30, 2025, amounted to $45,608 million, an increase from $44,567 million at the end of 2024[28] - The company reported a total current liability of $5,737 million as of September 30, 2025, down from $6,258 million at the end of 2024[28] - The company’s long-term debt, less current portion, was $22,482 million as of September 30, 2025, slightly down from $22,541 million at the end of 2024[28] - Cash and cash equivalents decreased to $175 million as of September 30, 2025, from $414 million at the end of 2024[28] Market Conditions and Future Outlook - The company expects total revenue for 2025 to be approximately $25.275 billion, at the low end of prior guidance due to declining recycled commodity prices[11] - The average price received for single stream recycled commodities was about $68 per ton, down from about $101 per ton in the prior year[16] - The leverage ratio is expected to improve, targeting a range of 2.5 to 3.0 times by mid-2026[12] - The company anticipates continued growth and optimization of its business, including the integration of the Stericycle acquisition, which is expected to yield synergies[19] Operational Highlights - The company completed four growth projects in Q3 2025, including new renewable natural gas facilities and recycling projects[12] - The landfill depletable tons increased to 33.7 million for the three months ended September 30, 2025, from 32.9 million in 2024[42] - The total collection and disposal revenue for the nine months ended September 30, 2025, was $19,124 million, a decrease of $3,600 million from $15,524 million in 2024[32] - The company achieved a 3.8% internal revenue growth in collection and disposal for the three months ended September 30, 2025[36] - The recycling processing and sales segment experienced a revenue decline of 14.0% for the three months ended September 30, 2025[36]