WM earnings analysis
What we found in WM'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
WM delivered a solid Q2: revenue rose 4.0% year over year to $6.684 billion, operating margin expanded 80 basis points to 18.7%, and GAAP EPS increased to $1.95 from $1.80. Cash generation strengthened, with free cash flow increasing 35.0% to $1.104 billion as capex declined. Offsetting the favorable pricing, margin and cash-flow trends, collection/special-waste volumes remained soft, Healthcare Solutions revenue declined, and recycled-commodity and RNG pricing weakened.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue rose 4.0% year over year
- Q2 revenue increased $254 million, or 4.0%, year over year to $6.684 billion and rose 7.3% from Q1 revenue of $6.230 billion. Growth was led by Collection and Disposal yield, energy surcharges and Recycling/Renewable Energy volume.
- Margins expanded materially
- Operating income rose $102 million, or 8.9%, to $1.253 billion; operating margin expanded 80 basis points year over year to 18.7% from 17.9%. Gross margin was 40.8%, up 50 basis points from 40.3% a year ago.
- GAAP EPS increased to $1.95
- GAAP net income attributable to WM increased $59 million to $785 million, and diluted EPS increased 8.3% to $1.95 from $1.80. EPS also rose from $1.79 in Q1 2026.
- Core Collection and Disposal grew
- Collection and Disposal net operating revenue grew $198 million to $5.479 billion, while Collection and Disposal operating income increased 6.1% to $1.550 billion. The business delivered 3.6% average-yield growth.
- Free cash flow rose 35.0%
- Operating cash flow increased $181 million to $1.726 billion and free cash flow rose $286 million to $1.104 billion. Quarterly capex declined $102 million to $630 million, or 9.4% of revenue, from $732 million.
- Capex intensity is declining
- First-half operating cash flow increased $474 million to $3.227 billion, while capital expenditures fell $283 million to $1.280 billion. Management attributed lower spending to fewer collection-vehicle purchases and a planned transition from peak sustainability-project construction to harvesting returns.
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.
- Core volumes remain slightly negative
- Internal volume declined $22 million, or 0.3%, in Q2 as lower collection and special-waste volumes offset Recycling and Renewable Energy growth. Management cited intentional shedding of lower-margin residential business and the prior-year benefit from wildfire cleanup activity.
- Commodity and RNG pricing pressure
- Average market prices for single-stream recycled commodities fell about 10% year over year in Q2, reducing Recycling Processing and Sales yield by $2 million. Renewable Energy yield also declined $4 million, primarily from lower RNG pricing.
- Near-term refinancing requirements
- WM had approximately $3.8 billion of debt maturing within the next 12 months as of June 30, 2026, including $2.0 billion of tax-exempt bonds and $1.1 billion of commercial paper. Total debt was $23.356 billion, up from $22.907 billion at December 31, 2025.
- No material risk-factor updates
- Item 1A reports 0 material changes to risk factors disclosed in the 2025 Form 10-K. The filing nevertheless notes that a roughly 50% increase in diesel prices drove higher Q2 energy-surcharge revenue and higher fuel-related costs.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.95
- Gross margin
- 40.8%
- Operating margin
- 18.7%
- Segment
- Collection and Disposal net operating revenue: $5.479 billion, up from $5.281 billion in Q2 2025.
- Segment
- Healthcare Solutions revenue declined $30 million, or 0.5%, year over year.
- Segment
- Recycling Processing and Sales and Renewable Energy combined yield declined $6 million, or 1.2%, year over year, despite higher volumes.
What they said about what is next.
The 10-Q does not provide explicit quantitative full-year revenue or EPS guidance; outlook was deferred to other company communications. MD&A expects a $400 million-$425 million cumulative Section 48 tax-credit benefit, with $309 million recognized through 2025 and the remainder anticipated in 2026-2027; it also expects up to $150 million of cumulative Section 45Z clean-fuel-production-tax-credit benefit through 2029.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 29, 2026
- Waste Management (WM) reported a strong Q1 2026 with revenues of $6.227 billion, reflecting a 3.5% increase from the prior year. The company achieved an EPS of $1.79, up from $1.58 a year ago, bolstered by improved…
- 10-K · February 9, 2026
- Waste Management (10-K for year ended Dec 31, 2025) emphasizes a ‘‘focused differentiation’’ strategy that leverages the company’s scale in collection, disposal, recycling and landfill-gas renewable energy while…
- 10-Q · October 28, 2025
- Waste Management reported Q3 2025 revenue of $6,443 million, up $834 million or 14.9% versus Q3 2024, driven largely by acquisitions (Stericycle) and yield/volume in Collection & Disposal. Despite higher revenue and…
- 10-Q · July 25, 2024
- Waste Management reported Q2 2024 revenue of $5,402 million, up 5.5% from $5,119 million a year ago, with income from operations rising to $1,009 million (18.7% of revenue) from $944 million (18.4%). Operating cash flow…
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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