Xylem(US:XYL)2026-02-10 12:02Revenue and Earnings - Fourth-quarter revenue reached $2.4 billion, up 6% year-over-year, with adjusted earnings per share increasing by 20% to $1.42[3] - Full-year revenue for 2025 was $9.0 billion, reflecting a 6% increase, with adjusted earnings per share of $5.08, up 19%[3] - The company initiated 2026 full-year revenue guidance of $9.1 to $9.2 billion, representing a 2% to 4% organic growth[3] - Orders for the fourth quarter totaled $2.4 billion, up 9% on a reported basis and 7% organically[3] - Xylem Inc. reported total revenue of $9,035 million for 2025, representing a 6% increase compared to $8,562 million in 2024[30] - For the quarter ended December 31, 2025, Xylem Inc. reported revenue of $2,397 million, a 6% increase from $2,256 million in the same quarter of 2024[30] - Year-to-date total revenue for 2025 reached $9,035 million, compared to $8,562 million in 2024, reflecting a 5.5% growth[32] - Total revenue for Q4 2025 was $2,397 million, a 6.3% increase from $2,256 million in Q4 2024[32] Profitability Metrics - Adjusted EBITDA margin for the fourth quarter was 23.2%, an increase of 220 basis points year-over-year, driven by productivity savings and strong price realization[4] - Full-year 2026 adjusted EBITDA margin is expected to be approximately 22.9% to 23.3%, an increase of 70 to 110 basis points from 2025[6] - Adjusted EBITDA for Q4 2025 was $557 million, maintaining an adjusted EBITDA margin of 23.2%[35] - The company reported a net income margin of 10.6% for the full year 2025, up from 10.4% in 2024[35] - Operating income for Q4 2025 was $456 million, up from $377 million in Q4 2024, resulting in an operating margin of 19.0% compared to 16.7%[32] Net Income and Dividends - Net income attributable to Xylem for the fourth quarter was $335 million, or $1.37 per share, with a net income margin of 14.0%[2] - Net income for 2025 reached $950 million, an increase of 6.7% from $890 million in 2024 and a significant rise from $609 million in 2023[16] - The Board of Directors declared a first-quarter dividend of $0.43 per share, an increase of 8%[5] - Dividends paid in 2025 amounted to $391 million, an increase from $350 million in 2024 and $299 million in 2023, reflecting a commitment to returning value to shareholders[16] Cash Flow and Investments - Operating cash flow for 2025 was $1,241 million, slightly down from $1,263 million in 2024 but up from $837 million in 2023[16] - Free cash flow for 2025 was calculated as $910 million, derived from operating cash flow minus capital expenditures[24] - Capital expenditures in 2025 totaled $331 million, compared to $321 million in 2024 and $271 million in 2023, indicating ongoing investment in growth[16] - The company reported a net cash decrease from financing activities of $501 million in 2025, compared to $615 million in 2024[16] - Xylem's cash and cash equivalents at the end of 2025 were $1,479 million, up from $1,121 million in 2024, indicating improved liquidity[16] Segment Performance - Measurement and Control Solutions segment saw a revenue increase of 11%, reaching $2,086 million in 2025, up from $1,871 million in 2024[30] - The Applied Water segment experienced a revenue growth of 3%, totaling $1,849 million in 2025 compared to $1,793 million in 2024[30] - The company’s Water Solutions and Services segment reported a revenue increase of 5%, reaching $2,464 million in 2025, up from $2,343 million in 2024[30] Strategic Focus and Growth - The company emphasizes organic revenue growth, excluding impacts from foreign currency and acquisitions, to provide a clearer view of performance[19] - The company plans to continue focusing on strategic acquisitions and investments to drive future growth and enhance operational capabilities[18] - The company achieved a book-to-bill ratio of 99% for the year ended December 31, 2025, indicating strong order growth[28] - The company’s adjusted revenue growth, excluding acquisitions and divestitures, was 5% for 2025 compared to the previous year[30] Special Charges and Costs - Restructuring and realignment costs for Q4 2025 were $46 million, compared to $36 million in Q4 2024[33] - The company incurred special charges of $2 million related to acquisition and integration costs in Q4 2025, down from $15 million in Q4 2024[33] - The gain from the sale of businesses was $16 million in Q4 2025, compared to a loss of $40 million in Q4 2024[32] - Interest expense decreased to $6 million in Q4 2025 from $9 million in Q4 2024[32]