Key Highlights

  • Third-quarter revenue rose 6.3% to $6.846 billion, with adjusted operating EBITDA up 5.8% to $2.121 billion.
  • Adjusted diluted EPS was $2.15 versus $1.98 a year earlier; reported EPS was $2.05 versus $1.49.
  • Free cash flow reached $985 million in the quarter and $3.009 billion over nine months, up from $2.114 billion.
  • Management affirmed 2026 guidance: revenue of $26.275 billion to $26.475 billion and free cash flow of $3.75 billion to $3.85 billion.
  • The company returned $957 million in the quarter, including $580 million of buybacks, and still expects $2 billion of repurchases for 2026.

Waste Management Earnings: Why Did Adjusted EPS Reach $2.15 With Guidance Held?

Waste Management (NYSE:WM) reported third-quarter results on Tuesday, October 27, with revenue of $6.846 billion, up 6.3% from $6.443 billion. Adjusted diluted EPS was $2.15, up from $1.98, while reported EPS rose to $2.05 from $1.49. As screened, the adjusted figure sat 1.42% below the $2.18 estimate.

The company affirmed all 2026 ranges: revenue of $26.275 billion to $26.475 billion, adjusted operating EBITDA of $8.15 billion to $8.25 billion and free cash flow of $3.75 billion to $3.85 billion. Management expects revenue and free cash flow at the high end. The release gave no separate fourth-quarter range.

Margins and Mix: How Did a Flat 31.0% EBITDA Margin Hide Rising Profit?

Adjusted operating EBITDA margin was 31.0%, against 31.1% a year earlier, even as dollars grew 5.8%. The collection and disposal price-cost spread added 40 basis points and Healthcare Solutions added 30, while higher fuel and risk management costs each took away 40.

Collection and Disposal revenue was $5.579 billion with an adjusted margin of 38.3%, versus 39.0%. Yield was 3.4%, core price 5.8%, and workday-adjusted volume fell 0.5%. Management tied the decline to shedding lower-margin residential work and commercial losses linked to earlier national account broker changes.

Healthcare Solutions, Recycling and Renewable Energy: Which Segments Moved Most?

Healthcare Solutions revenue grew 3.7% to $651 million, while adjusted EBITDA rose to $146 million at a 22.4% margin, from $110 million at 17.5%. Management linked the gain to cost management, synergy capture and pricing.

Recycling Processing and Sales revenue rose to $441 million from $372 million as the blended single-stream price climbed to about $82 per ton from about $68. Renewable Energy revenue was $167 million, up from $115 million, but its adjusted margin eased to 38.9% from 41.7% as the Renewable Fuel Standard credit price slipped to $2.32 from $2.56.

Cash Flow and Buybacks: What Did the $3.009 Billion of Nine-Month Free Cash Flow Fund?

Operating cash flow was $1.640 billion in the quarter and $4.867 billion over nine months, up 12.0%. Capital spending to support the business fell to $1.746 billion from $1.910 billion for nine months.

Shareholder returns were $957 million in the quarter, split between $580 million of repurchases and $377 million of dividends. Nine-month returns of more than $2.72 billion equal over 90% of free cash flow, and management reiterated $2 billion of buybacks for 2026. Long-term debt was $21.846 billion at September 30, against $22.196 billion at year-end.

What to Watch Next: Can Volume Turn Positive and Healthcare Margins Keep Climbing?

The conference call is scheduled for Wednesday, October 28, at 10 a.m. Eastern. Investors will track whether volume turns positive, whether Healthcare Solutions margins keep climbing from 22.4%, and whether revenue and free cash flow reach the high end of guidance.