Xylem's Q1 Earnings & Revenues Top Estimates, Orders Down Y/Y

Core Insights - Xylem Inc. reported first-quarter 2025 adjusted earnings of $1.03 per share, exceeding the Zacks Consensus Estimate of 95 cents, marking a 14% year-over-year increase [1] - Revenues for the quarter reached $2.07 billion, surpassing the consensus estimate of $2.04 billion, with a 2% year-over-year growth driven by strong order growth across segments [1] - Orders totaled $2.16 billion, reflecting a 4% decrease year-over-year on a reported basis and a 2% decline on an organic basis [2] Segment Performance - Water Infrastructure segment revenues were $581 million, up 1% year-over-year, with organic sales increasing by 5% due to strong demand for water transportation and treatment solutions [2] - Applied Water segment generated revenues of $435 million, remaining flat year-over-year, with organic sales up 1% driven by the building solutions market [3] - Measurement & Control Solutions segment revenues totaled $490 million, a 6% year-over-year increase, with organic sales also up 6% due to energy metering demand [4] - Water Solutions and Services segment revenues were $563 million, flat year-over-year, with organic sales increasing by 1% supported by service offerings [4] Financial Metrics - Adjusted EBITDA for the quarter was $423 million, an 8.2% increase from the previous year, with the margin improving to 20.4% from 19.2% [5] - Adjusted operating income rose to $325 million, up 10.5% year-over-year, with the adjusted operating margin increasing to 15.7% from 14.5% [5] - Cash and cash equivalents at the end of the quarter were $1.06 billion, down from $1.12 billion at the end of December 2024, while long-term debt slightly decreased to $1.97 billion [6] Cash Flow and Shareholder Returns - Net cash generated from operating activities was $33 million, down from $89 million in the prior year, with capital expenditure at $71 million, a 4.1% decrease [7] - Xylem paid dividends of $98 million in the first quarter, an 11.4% increase year-over-year, and repurchased shares worth $12.9 million [8] 2025 Guidance - Xylem expects revenues for 2025 to be in the range of $8.7-$8.8 billion, indicating a 1-2% increase from the prior year on a reported basis and 3-4% on an organic basis [10] - Adjusted EBITDA margin is projected to be approximately 21.3-21.8%, reflecting an expansion of 70-120 basis points from the previous year [10] - Adjusted earnings are forecasted to be between $4.50 and $4.70 per share, up from $4.27 per share in 2024 [10]