WCN earnings analysis
What we found in WCN's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Waste Connections delivered 6.4% year-over-year Q2 revenue growth to $2.562 billion and reported EPS of $1.17, with adjusted EPS of $1.50. Pricing, acquisitions and higher E&P activity supported growth across every operating segment and lifted adjusted EBITDA to $840.1 million. However, GAAP operating income declined 4.8% and operating margin fell 2.0 points to 17.1% because of a $55.8 million closure/post-closure liability adjustment, while volume losses, higher fuel costs and a $9.364 billion debt load remain key offsets.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue rose 6.4% on pricing and acquisitions
- Q2 revenue rose $154.6 million, or 6.4%, year over year to $2.562 billion. Existing-operation pricing added $146.3 million, including $121.8 million of core price increases, while acquisitions contributed $47.1 million.
- Gross margin modestly expanded
- Gross margin increased 0.2 percentage points to 42.3% as cost of operations fell to 57.7% of revenue from 57.9%. Price-led growth and lower risk-management and labor costs more than offset $19.3 million of higher fuel expense.
- EPS and adjusted EBITDA increased
- Reported diluted EPS increased to $1.17 from $1.12, while adjusted diluted EPS rose to $1.50 from $1.29. Adjusted EBITDA increased $53.7 million to $840.1 million and its margin reached 32.8% versus 32.7%.
- All operating segments grew EBITDA
- All six operating segments increased revenue and EBITDA. Canada posted the largest revenue increase, up $42.4 million to $385.8 million, while Southern EBITDA increased $16.5 million to $170.8 million.
- Operating cash flow and cash balance improved
- Six-month operating cash flow increased $99.1 million to $1.279 billion. Cash and equivalents were $98.2 million at June 30, 2026, up from $46.0 million at December 31, 2025.
- Substantial shareholder distributions continued
- The company repurchased 3.8 million shares for $614.5 million in the first half at an average $163.53 per share, while maintaining a quarterly dividend of $0.350 per share.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Closure-liability charge drove margin contraction
- Operating income fell $21.9 million, or 4.8%, to $437.6 million and operating margin contracted 2.0 percentage points to 17.1%, primarily because impairments and other operating items rose to $58.5 million from $4.0 million. The current-quarter charge included $55.8 million of closure and post-closure liability adjustments.
- Collection and roll-off volumes remain negative
- Existing-operation volume losses totaled $64.1 million, reflecting lower roll-off and commercial collection volumes in Eastern, Southern and Canada. These losses partially offset pricing and acquisition-led revenue growth.
- Debt and interest burden increased
- Long-term debt totaled $9.364 billion at June 30, 2026, including $2.275 billion outstanding under the revolving credit facility. Interest expense increased $8.5 million, or 10.2%, to $91.2 million following $600.0 million of 4.80% senior notes issued in March 2026.
- Capital intensity and working-capital deficit persist
- Capital needs are elevated: six-month property-and-equipment capex was $598.9 million, plus $51.0 million for undeveloped land, and full-year property-and-equipment capex is expected at approximately $1.250 billion. The company reported a $729.0 million working-capital deficit.
- Fuel-price exposure remains material
- Management expects to buy 25.2 million gallons of diesel at market prices during the remainder of 2026; a $0.10-per-gallon increase would reduce pre-tax income by approximately $2.5 million. Higher diesel prices already increased quarterly fuel expense by $19.3 million.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.17
- Gross margin
- 42.3%
- Operating margin
- 17.1%
- Segment
- Southern: revenue $518.650M, EBITDA $170.844M, margin 32.9%
- Segment
- Western: revenue $492.725M, EBITDA $133.736M, margin 27.1%
- Segment
- Eastern: revenue $443.954M, EBITDA $121.644M, margin 27.4%
- Segment
- Central: revenue $423.761M, EBITDA $154.927M, margin 36.6%
- Segment
- Canada: revenue $385.767M, EBITDA $167.912M, margin 43.5%
- Segment
- MidSouth: revenue $296.750M, EBITDA $80.689M, margin 27.2%
What they said about what is next.
The 10-Q provides no quantitative revenue or EPS outlook. Management expects approximately $1.250 billion of 2026 property-and-equipment capital expenditures; it also states that cash, the revolving credit agreement and expected operating cash flow should adequately fund foreseeable needs.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 23, 2026
- Waste Connections reported Q1 2026 revenue of $2,370,631,000, up 6.4% YoY from $2,228,176,000, driven by $120.0 million of net price increases and acquisitions. Segment EBITDA rose to $758,413,000 (32.0% of revenue) but…
- 10-K · February 12, 2026
- Waste Connections reports 2025 revenue of $9,466,915,000 (up from $8,919,591,000 in 2024) and diluted EPS of $4.17 (vs. $2.39 in 2024), driven by higher operating income of $1,710,174,000. The company continues its dual…
- 10-Q · October 22, 2025
- Waste Connections reported Q3 revenue of $2,458,378 (reported in the filing as $2,458,378 in thousands), up from $2,338,488 a year ago, driven by collection, E&P and transfer growth. Operating income declined to…
- 10-Q · July 24, 2025
- Waste Connections reported quarterly revenue of $2,407,055,000 and diluted EPS of $1.12 for the three months ended June 30, 2025. Revenue and operating income improved versus both the prior quarter and the year-ago…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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