[10-Q] Waste Management, Inc. Quarterly Earnings Report
Q2 2025 performance (vs. Q2 2024):
- Revenue $6.43 B, +19%
- Operating income $1.15 B, +14%
- Net income attributable to WM $726 M, +7%; diluted EPS $1.80, +6%
Six-month 2025: Revenue $12.45 B (+18%), net income $1.36 B (-2%), EPS $3.37 (-2%). Operating cash flow climbed 9% to $2.75 B while capex rose 17% to $1.56 B, holding free cash flow roughly flat at ≈$1.2 B.
Balance sheet 6/30/25: Assets $45.7 B (+3% YTD); equity $9.2 B (+11%). Gross debt $24.0 B (up ~$0.1 B); cash $440 M. WM has $1.8 B undrawn on its $3.5 B revolver and refinanced $483 M of Stericycle notes.
The November 2024 Stericycle acquisition created the WM Healthcare Solutions segment, broadening service mix and driving top-line growth. Renewable-energy and low-income-housing investments generated $89 M YTD in tax credits, lowering the effective tax rate to 20.5%.
Interest expense jumped 71% YoY to $232 M, and six-month earnings were pressured by higher depreciation, SG&A and integration costs. Landfill & environmental liabilities remain stable at $3.3 B.
Risultati Q2 2025 (rispetto a Q2 2024):
- Ricavi 6,43 Mld $, +19%
- Reddito operativo 1,15 Mld $, +14%
- Utile netto attribuibile a WM 726 M $, +7%; EPS diluito 1,80 $, +6%
Primi sei mesi 2025: Ricavi 12,45 Mld $ (+18%), utile netto 1,36 Mld $ (-2%), EPS 3,37 $ (-2%). Il flusso di cassa operativo è aumentato del 9% a 2,75 Mld $, mentre gli investimenti in capitale sono cresciuti del 17% a 1,56 Mld $, mantenendo il flusso di cassa libero sostanzialmente stabile intorno a ≈1,2 Mld $.
Stato patrimoniale al 30/06/25: Attività 45,7 Mld $ (+3% da inizio anno); patrimonio netto 9,2 Mld $ (+11%). Debito lordo 24,0 Mld $ (in aumento di circa 0,1 Mld $); liquidità 440 M $. WM dispone di 1,8 Mld $ non utilizzati sul revolver da 3,5 Mld $ e ha rifinanziato 483 M $ di obbligazioni Stericycle.
L'acquisizione di Stericycle nel novembre 2024 ha creato il segmento WM Healthcare Solutions, ampliando la gamma di servizi e favorendo la crescita dei ricavi. Gli investimenti in energie rinnovabili e abitazioni a basso reddito hanno generato 89 M $ di crediti d'imposta da inizio anno, riducendo l'aliquota fiscale effettiva al 20,5%.
Le spese per interessi sono aumentate del 71% su base annua a 232 M $, e i risultati semestrali sono stati influenzati negativamente da maggiori ammortamenti, costi SG&A e di integrazione. Le passività per discariche e ambiente restano stabili a 3,3 Mld $.
Desempeño del 2T 2025 (vs. 2T 2024):
- Ingresos 6,43 mil M$, +19%
- Ingreso operativo 1,15 mil M$, +14%
- Ingreso neto atribuible a WM 726 M$, +7%; EPS diluido 1,80$, +6%
Primeros seis meses de 2025: Ingresos 12,45 mil M$ (+18%), ingreso neto 1,36 mil M$ (-2%), EPS 3,37$ (-2%). El flujo de caja operativo subió 9% a 2,75 mil M$, mientras que el capex aumentó 17% a 1,56 mil M$, manteniendo el flujo de caja libre aproximadamente estable en ≈1,2 mil M$.
Balance al 30/06/25: Activos 45,7 mil M$ (+3% en el año); patrimonio 9,2 mil M$ (+11%). Deuda bruta 24,0 mil M$ (subió ~0,1 mil M$); efectivo 440 M$. WM tiene 1,8 mil M$ disponibles en su línea revolvente de 3,5 mil M$ y refinanció 483 M$ en notas de Stericycle.
La adquisición de Stericycle en noviembre de 2024 creó el segmento WM Healthcare Solutions, ampliando la mezcla de servicios y estimulando el crecimiento de ingresos. Las inversiones en energías renovables y viviendas para bajos ingresos generaron 89 M$ en créditos fiscales en lo que va del año, reduciendo la tasa impositiva efectiva al 20,5%.
Los gastos por intereses aumentaron 71% interanual a 232 M$, y las ganancias semestrales se vieron presionadas por mayores depreciaciones, gastos SG&A y costos de integración. Las obligaciones por vertederos y medio ambiente se mantienen estables en 3,3 mil M$.
2025년 2분기 실적 (2024년 2분기 대비):
- 매출 64.3억 달러, +19%
- 영업이익 11.5억 달러, +14%
- WM 귀속 순이익 7.26억 달러, +7%; 희석 주당순이익(EPS) 1.80달러, +6%
2025년 상반기: 매출 124.5억 달러 (+18%), 순이익 13.6억 달러 (-2%), EPS 3.37달러 (-2%). 영업 현금 흐름은 9% 증가한 27.5억 달러, 자본적지출(capex)은 17% 증가한 15.6억 달러로, 자유 현금 흐름은 약 12억 달러로 거의 유지됨.
2025년 6월 30일 기준 재무상태표: 자산 457억 달러 (+연초 대비 3%); 자본 92억 달러 (+11%). 총부채 240억 달러 (약 1억 달러 증가); 현금 4.4억 달러. WM은 35억 달러 규모의 리볼빙 신용한도 중 18억 달러를 미사용 중이며, Stericycle 채권 4.83억 달러를 재융자함.
2024년 11월 Stericycle 인수로 WM Healthcare Solutions 부문이 신설되어 서비스 구성을 확대하고 매출 성장을 견인함. 재생 에너지 및 저소득층 주택 투자로 올해 누적 8,900만 달러의 세액 공제를 창출해 유효 세율을 20.5%로 낮춤.
이자 비용은 전년 대비 71% 급증한 2.32억 달러였으며, 상반기 수익은 감가상각비, 판매관리비(SG&A), 통합 비용 증가로 압박을 받음. 매립지 및 환경 관련 부채는 33억 달러로 안정적임.
Performance T2 2025 (vs. T2 2024) :
- Chiffre d'affaires 6,43 Mds $, +19%
- Résultat d'exploitation 1,15 Md $, +14%
- Résultat net attribuable à WM 726 M$, +7 % ; BPA dilué 1,80 $, +6 %
Semestre 2025 : Chiffre d'affaires 12,45 Mds $ (+18 %), résultat net 1,36 Md $ (-2 %), BPA 3,37 $ (-2 %). Le flux de trésorerie opérationnel a augmenté de 9 % pour atteindre 2,75 Mds $, tandis que les dépenses d'investissement (capex) ont progressé de 17 % à 1,56 Md $, maintenant le flux de trésorerie disponible à environ ≈1,2 Md $.
Bilan au 30/06/25 : Actifs 45,7 Mds $ (+3 % depuis le début de l'année) ; capitaux propres 9,2 Mds $ (+11 %). Dette brute 24,0 Mds $ (en hausse d'environ 0,1 Md $) ; trésorerie 440 M$. WM dispose de 1,8 Md $ non utilisés sur sa ligne de crédit renouvelable de 3,5 Mds $ et a refinancé 483 M$ de titres Stericycle.
L’acquisition de Stericycle en novembre 2024 a créé le segment WM Healthcare Solutions, élargissant la gamme de services et stimulant la croissance du chiffre d'affaires. Les investissements dans les énergies renouvelables et le logement social ont généré 89 M$ de crédits d’impôt depuis le début de l’année, réduisant le taux d’imposition effectif à 20,5 %.
Les charges d’intérêts ont bondi de 71 % en glissement annuel à 232 M$, et les résultats semestriels ont été impactés par des amortissements plus élevés, des frais SG&A et des coûts d’intégration accrus. Les passifs liés aux décharges et à l’environnement restent stables à 3,3 Mds $.
Leistung Q2 2025 (vs. Q2 2024):
- Umsatz 6,43 Mrd. $, +19%
- Operatives Ergebnis 1,15 Mrd. $, +14%
- Nettoeinkommen auf WM entfallend 726 Mio. $, +7%; verwässertes EPS 1,80 $, +6%
Sechs Monate 2025: Umsatz 12,45 Mrd. $ (+18%), Nettoergebnis 1,36 Mrd. $ (-2%), EPS 3,37 $ (-2%). Der operative Cashflow stieg um 9 % auf 2,75 Mrd. $, während die Investitionsausgaben (Capex) um 17 % auf 1,56 Mrd. $ zunahmen, wodurch der Free Cashflow mit etwa ≈1,2 Mrd. $ nahezu konstant blieb.
Bilanz zum 30.06.25: Aktiva 45,7 Mrd. $ (+3 % seit Jahresbeginn); Eigenkapital 9,2 Mrd. $ (+11 %). Bruttoverschuldung 24,0 Mrd. $ (Anstieg um ca. 0,1 Mrd. $); Cash 440 Mio. $. WM hat 1,8 Mrd. $ ungenutzt von seiner 3,5 Mrd. $ revolvierenden Kreditlinie und refinanzierte 483 Mio. $ an Stericycle-Anleihen.
Die Übernahme von Stericycle im November 2024 führte zur Gründung des Segments WM Healthcare Solutions, was die Dienstleistungspalette erweiterte und das Umsatzwachstum antrieb. Investitionen in erneuerbare Energien und einkommensschwache Wohnprojekte generierten bisher 89 Mio. $ an Steuergutschriften, wodurch der effektive Steuersatz auf 20,5 % sank.
Die Zinsaufwendungen stiegen im Jahresvergleich um 71 % auf 232 Mio. $, und das Halbjahresergebnis wurde durch höhere Abschreibungen, SG&A-Kosten und Integrationsaufwendungen belastet. Die Rückstellungen für Deponien und Umwelt bleiben stabil bei 3,3 Mrd. $.
- Revenue up 19% YoY in Q2 2025, boosted by Stericycle and strong pricing.
- Operating cash flow increased 9% to $2.75 B, fully funding dividends and reinvestment.
- Equity rose $948 M YTD, improving leverage metrics.
- Effective tax rate fell to 20.5% due to RNG and housing tax credits.
- $1.8 B unused revolver capacity provides ample liquidity.
- Six-month net income declined 2% despite higher sales, reflecting cost pressures.
- Interest expense surged 71% YoY to $232 M in Q2, squeezing margins.
- Capex up 17% to $1.56 B, limiting near-term free cash flow growth.
- Gross debt sizable at $24 B with $4 B maturing within 12 months.
Insights
TL;DR – Solid revenue beat and cash flow; margin and interest drag keep outlook balanced.
WM’s 19% revenue surge outpaced historical growth, reflecting Stericycle consolidation and resilient core pricing. Operating cash flow comfortably covers dividends ($669 M YTD) and capex. Equity is up nearly $1 B, bringing net-debt/EBITDA to an estimated 2.9×—still reasonable. However, interest expense and a 200 bp rise in SG&A compressed margins, so six-month EPS slipped 2%. Management’s RNG build-out and tax-credit strategy enhance after-tax returns, but sustained capex and $4 B near-term maturities warrant monitoring. Net: modestly positive with manageable risks.
TL;DR – Leverage, rising capex and legal liabilities offset earnings stability; risk profile unchanged.
Total debt remains high at $24 B, and Q2 interest costs spiked 71%, illustrating sensitivity to rates. Capex intensity (12.6% of revenue YTD) plus Stericycle integration could pressure future free cash flow. Environmental liabilities stay at $3.3 B, but San Jacinto remediation carries cost-overrun risk. Liquidity is adequate, yet reliance on commercial paper and revolving capacity persists. Overall risk posture is neutral: no acute threats, but limited cushion against shocks.
Risultati Q2 2025 (rispetto a Q2 2024):
- Ricavi 6,43 Mld $, +19%
- Reddito operativo 1,15 Mld $, +14%
- Utile netto attribuibile a WM 726 M $, +7%; EPS diluito 1,80 $, +6%
Primi sei mesi 2025: Ricavi 12,45 Mld $ (+18%), utile netto 1,36 Mld $ (-2%), EPS 3,37 $ (-2%). Il flusso di cassa operativo è aumentato del 9% a 2,75 Mld $, mentre gli investimenti in capitale sono cresciuti del 17% a 1,56 Mld $, mantenendo il flusso di cassa libero sostanzialmente stabile intorno a ≈1,2 Mld $.
Stato patrimoniale al 30/06/25: Attività 45,7 Mld $ (+3% da inizio anno); patrimonio netto 9,2 Mld $ (+11%). Debito lordo 24,0 Mld $ (in aumento di circa 0,1 Mld $); liquidità 440 M $. WM dispone di 1,8 Mld $ non utilizzati sul revolver da 3,5 Mld $ e ha rifinanziato 483 M $ di obbligazioni Stericycle.
L'acquisizione di Stericycle nel novembre 2024 ha creato il segmento WM Healthcare Solutions, ampliando la gamma di servizi e favorendo la crescita dei ricavi. Gli investimenti in energie rinnovabili e abitazioni a basso reddito hanno generato 89 M $ di crediti d'imposta da inizio anno, riducendo l'aliquota fiscale effettiva al 20,5%.
Le spese per interessi sono aumentate del 71% su base annua a 232 M $, e i risultati semestrali sono stati influenzati negativamente da maggiori ammortamenti, costi SG&A e di integrazione. Le passività per discariche e ambiente restano stabili a 3,3 Mld $.
Desempeño del 2T 2025 (vs. 2T 2024):
- Ingresos 6,43 mil M$, +19%
- Ingreso operativo 1,15 mil M$, +14%
- Ingreso neto atribuible a WM 726 M$, +7%; EPS diluido 1,80$, +6%
Primeros seis meses de 2025: Ingresos 12,45 mil M$ (+18%), ingreso neto 1,36 mil M$ (-2%), EPS 3,37$ (-2%). El flujo de caja operativo subió 9% a 2,75 mil M$, mientras que el capex aumentó 17% a 1,56 mil M$, manteniendo el flujo de caja libre aproximadamente estable en ≈1,2 mil M$.
Balance al 30/06/25: Activos 45,7 mil M$ (+3% en el año); patrimonio 9,2 mil M$ (+11%). Deuda bruta 24,0 mil M$ (subió ~0,1 mil M$); efectivo 440 M$. WM tiene 1,8 mil M$ disponibles en su línea revolvente de 3,5 mil M$ y refinanció 483 M$ en notas de Stericycle.
La adquisición de Stericycle en noviembre de 2024 creó el segmento WM Healthcare Solutions, ampliando la mezcla de servicios y estimulando el crecimiento de ingresos. Las inversiones en energías renovables y viviendas para bajos ingresos generaron 89 M$ en créditos fiscales en lo que va del año, reduciendo la tasa impositiva efectiva al 20,5%.
Los gastos por intereses aumentaron 71% interanual a 232 M$, y las ganancias semestrales se vieron presionadas por mayores depreciaciones, gastos SG&A y costos de integración. Las obligaciones por vertederos y medio ambiente se mantienen estables en 3,3 mil M$.
2025년 2분기 실적 (2024년 2분기 대비):
- 매출 64.3억 달러, +19%
- 영업이익 11.5억 달러, +14%
- WM 귀속 순이익 7.26억 달러, +7%; 희석 주당순이익(EPS) 1.80달러, +6%
2025년 상반기: 매출 124.5억 달러 (+18%), 순이익 13.6억 달러 (-2%), EPS 3.37달러 (-2%). 영업 현금 흐름은 9% 증가한 27.5억 달러, 자본적지출(capex)은 17% 증가한 15.6억 달러로, 자유 현금 흐름은 약 12억 달러로 거의 유지됨.
2025년 6월 30일 기준 재무상태표: 자산 457억 달러 (+연초 대비 3%); 자본 92억 달러 (+11%). 총부채 240억 달러 (약 1억 달러 증가); 현금 4.4억 달러. WM은 35억 달러 규모의 리볼빙 신용한도 중 18억 달러를 미사용 중이며, Stericycle 채권 4.83억 달러를 재융자함.
2024년 11월 Stericycle 인수로 WM Healthcare Solutions 부문이 신설되어 서비스 구성을 확대하고 매출 성장을 견인함. 재생 에너지 및 저소득층 주택 투자로 올해 누적 8,900만 달러의 세액 공제를 창출해 유효 세율을 20.5%로 낮춤.
이자 비용은 전년 대비 71% 급증한 2.32억 달러였으며, 상반기 수익은 감가상각비, 판매관리비(SG&A), 통합 비용 증가로 압박을 받음. 매립지 및 환경 관련 부채는 33억 달러로 안정적임.
Performance T2 2025 (vs. T2 2024) :
- Chiffre d'affaires 6,43 Mds $, +19%
- Résultat d'exploitation 1,15 Md $, +14%
- Résultat net attribuable à WM 726 M$, +7 % ; BPA dilué 1,80 $, +6 %
Semestre 2025 : Chiffre d'affaires 12,45 Mds $ (+18 %), résultat net 1,36 Md $ (-2 %), BPA 3,37 $ (-2 %). Le flux de trésorerie opérationnel a augmenté de 9 % pour atteindre 2,75 Mds $, tandis que les dépenses d'investissement (capex) ont progressé de 17 % à 1,56 Md $, maintenant le flux de trésorerie disponible à environ ≈1,2 Md $.
Bilan au 30/06/25 : Actifs 45,7 Mds $ (+3 % depuis le début de l'année) ; capitaux propres 9,2 Mds $ (+11 %). Dette brute 24,0 Mds $ (en hausse d'environ 0,1 Md $) ; trésorerie 440 M$. WM dispose de 1,8 Md $ non utilisés sur sa ligne de crédit renouvelable de 3,5 Mds $ et a refinancé 483 M$ de titres Stericycle.
L’acquisition de Stericycle en novembre 2024 a créé le segment WM Healthcare Solutions, élargissant la gamme de services et stimulant la croissance du chiffre d'affaires. Les investissements dans les énergies renouvelables et le logement social ont généré 89 M$ de crédits d’impôt depuis le début de l’année, réduisant le taux d’imposition effectif à 20,5 %.
Les charges d’intérêts ont bondi de 71 % en glissement annuel à 232 M$, et les résultats semestriels ont été impactés par des amortissements plus élevés, des frais SG&A et des coûts d’intégration accrus. Les passifs liés aux décharges et à l’environnement restent stables à 3,3 Mds $.
Leistung Q2 2025 (vs. Q2 2024):
- Umsatz 6,43 Mrd. $, +19%
- Operatives Ergebnis 1,15 Mrd. $, +14%
- Nettoeinkommen auf WM entfallend 726 Mio. $, +7%; verwässertes EPS 1,80 $, +6%
Sechs Monate 2025: Umsatz 12,45 Mrd. $ (+18%), Nettoergebnis 1,36 Mrd. $ (-2%), EPS 3,37 $ (-2%). Der operative Cashflow stieg um 9 % auf 2,75 Mrd. $, während die Investitionsausgaben (Capex) um 17 % auf 1,56 Mrd. $ zunahmen, wodurch der Free Cashflow mit etwa ≈1,2 Mrd. $ nahezu konstant blieb.
Bilanz zum 30.06.25: Aktiva 45,7 Mrd. $ (+3 % seit Jahresbeginn); Eigenkapital 9,2 Mrd. $ (+11 %). Bruttoverschuldung 24,0 Mrd. $ (Anstieg um ca. 0,1 Mrd. $); Cash 440 Mio. $. WM hat 1,8 Mrd. $ ungenutzt von seiner 3,5 Mrd. $ revolvierenden Kreditlinie und refinanzierte 483 Mio. $ an Stericycle-Anleihen.
Die Übernahme von Stericycle im November 2024 führte zur Gründung des Segments WM Healthcare Solutions, was die Dienstleistungspalette erweiterte und das Umsatzwachstum antrieb. Investitionen in erneuerbare Energien und einkommensschwache Wohnprojekte generierten bisher 89 Mio. $ an Steuergutschriften, wodurch der effektive Steuersatz auf 20,5 % sank.
Die Zinsaufwendungen stiegen im Jahresvergleich um 71 % auf 232 Mio. $, und das Halbjahresergebnis wurde durch höhere Abschreibungen, SG&A-Kosten und Integrationsaufwendungen belastet. Die Rückstellungen für Deponien und Umwelt bleiben stabil bei 3,3 Mrd. $.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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| For the Quarterly Period Ended |
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or | |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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| For the transition period from to |
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Commission file number | |
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
(Address of principal executive offices)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
| Trading Symbol |
| Name of Each Exchange on Which Registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| Accelerated filer ☐ | |
Non-accelerated filer ☐ | | Smaller reporting company |
| | Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
The number of shares of Common Stock, $0.01 par value, of the registrant outstanding at July 25, 2025 was
PART I.
Item 1. Financial Statements.
WASTE MANAGEMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Millions, Except Share and Par Value Amounts)
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ASSETS | | | | | | |
Current assets: |
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Cash and cash equivalents | | $ | | | $ | |
Accounts receivable, net of allowance for doubtful accounts of $ | |
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Other receivables, net of allowance for doubtful accounts of $ | |
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Parts and supplies | |
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Other current assets | |
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Total current assets | |
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Property and equipment, net of accumulated depreciation and depletion of $ | |
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Goodwill | |
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Other intangible assets, net | |
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Restricted funds | |
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Investments in unconsolidated entities | |
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Other long-term assets | |
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Total assets | | $ | | | $ | |
LIABILITIES AND EQUITY | | | | | | |
Current liabilities: | |
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Accounts payable | | $ | | | $ | |
Accrued liabilities | |
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Deferred revenues | |
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Current portion of long-term debt | |
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Total current liabilities | |
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Long-term debt, less current portion | |
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Deferred income taxes | |
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Landfill and environmental remediation liabilities | |
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Other long-term liabilities | |
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Total liabilities | |
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Commitments and contingencies (Note 6) | |
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Equity: | |
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Waste Management, Inc. stockholders’ equity: | |
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Common stock, $ | |
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Additional paid-in capital | |
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Retained earnings | |
| | |
| |
Accumulated other comprehensive income (loss) | |
| | |
| ( |
Treasury stock at cost, | |
| ( | |
| ( |
Total Waste Management, Inc. stockholders’ equity | |
| | |
| |
Noncontrolling interests | |
| | |
| |
Total equity | |
| | |
| |
Total liabilities and equity | | $ | | | $ | |
See Notes to Condensed Consolidated Financial Statements.
2
WASTE MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Millions, Except per Share Amounts)
(Unaudited)
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, | | June 30, | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
Operating revenues | | $ | | | $ | | | $ | | | $ | |
Costs and expenses: | |
| | | | | |
| | | | |
Operating | |
| | |
| | |
| | |
| |
Selling, general and administrative | |
| | |
| | |
| | |
| |
Depreciation, depletion and amortization | |
| | |
| | |
| | |
| |
Restructuring | |
| | |
| — | |
| | |
| — |
(Gain) loss from divestitures, asset impairments and unusual items, net | |
| | |
| | |
| | |
| |
| |
| | |
| | |
| | |
| |
Income from operations | |
| | |
| | |
| | |
| |
Other income (expense): | |
|
| | | | |
| | | | |
Interest expense, net | |
| ( | |
| ( | |
| ( | |
| ( |
Equity in net income (loss) of unconsolidated entities | |
| | |
| | |
| | |
| |
Other, net | |
| | |
| ( | |
| | |
| |
| |
| ( | |
| ( | |
| ( | |
| ( |
Income before income taxes | |
| | |
| | |
| | |
| |
Income tax expense | |
| | |
| | |
| | |
| |
Consolidated net income | |
| | |
| | |
| | |
| |
Less: Net income (loss) attributable to noncontrolling interests | |
| | |
| — | |
| | |
| ( |
Net income attributable to Waste Management, Inc. | | $ | | | $ | | | $ | | | $ | |
Basic earnings per common share | | $ | | | $ | | | $ | | | $ | |
Diluted earnings per common share | | $ | | | $ | | | $ | | | $ | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Millions)
(Unaudited)
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, | | June 30, | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
Consolidated net income | | $ | | | $ | | | $ | | | $ | |
Other comprehensive income (loss), net of tax: | |
| | |
|
| |
| | |
|
|
Derivative instruments, net | |
| ( | |
| ( | |
| ( | |
| ( |
Available-for-sale securities, net | |
| | |
| ( | |
| | |
| — |
Foreign currency translation adjustments | |
| | |
| ( | |
| | |
| ( |
Post-retirement benefit obligations, net | |
| — | | | ( | |
| — | |
| ( |
Other comprehensive income (loss), net of tax | |
| | | | ( | |
| | |
| ( |
Comprehensive income | |
| | |
| | |
| | |
| |
Less: Comprehensive income (loss) attributable to noncontrolling interests | |
| | | | — | |
| | |
| ( |
Comprehensive income attributable to Waste Management, Inc. | | $ | | | $ | | | $ | | | $ | |
See Notes to Condensed Consolidated Financial Statements.
3
WASTE MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Millions)
(Unaudited)
| | | | | | |
| | Six Months Ended | ||||
| | June 30, | ||||
|
| 2025 |
| 2024 | ||
Cash flows from operating activities: |
|
|
| | |
|
Consolidated net income |
| $ | | | $ | |
Adjustments to reconcile consolidated net income to net cash provided by operating activities: | |
| | |
|
|
Depreciation, depletion and amortization | |
| | |
| |
Deferred income tax expense (benefit) | |
| | |
| |
Interest accretion on landfill and environmental remediation liabilities | |
| | |
| |
Provision for bad debts | |
| | |
| |
Equity-based compensation expense | |
| | |
| |
Net gain on disposal of assets | |
| ( | |
| ( |
(Gain) loss from divestitures, asset impairments and other, net | |
| | |
| |
Equity in net (income) loss of unconsolidated entities, net of dividends | |
| ( | |
| ( |
Change in operating assets and liabilities, net of effects of acquisitions and divestitures: | |
|
| |
|
|
Receivables | |
| ( | |
| ( |
Other current assets | |
| ( | |
| ( |
Other assets | |
| | |
| |
Accounts payable and accrued liabilities | |
| | |
| |
Deferred revenues and other liabilities | |
| ( | |
| ( |
Net cash provided by operating activities | |
| | |
| |
Cash flows from investing activities: | |
|
| |
|
|
Acquisitions of businesses, net of cash acquired | |
| ( | |
| ( |
Capital expenditures | |
| ( | |
| ( |
Proceeds from divestitures of businesses and other assets, net of cash divested | |
| | |
| |
Other, net | |
| ( | |
| ( |
Net cash used in investing activities | |
| ( | |
| ( |
Cash flows from financing activities: | |
|
| |
|
|
New borrowings | |
| | |
| |
Debt repayments | |
| ( | |
| ( |
Common stock repurchase program | |
| — | |
| ( |
Cash dividends | |
| ( | |
| ( |
Exercise of common stock options | |
| | |
| |
Tax payments associated with equity-based compensation transactions | |
| ( | |
| ( |
Other, net | |
| ( | |
| ( |
Net cash used in financing activities | |
| ( | |
| ( |
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | |
| | |
| ( |
Increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents | |
| | |
| ( |
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period | |
| | |
| |
Cash, cash equivalents and restricted cash and cash equivalents at end of period |
| $ | | | $ | |
| | | | | | |
Reconciliation of cash, cash equivalents and restricted cash and cash equivalents at end of period: | | | | | | |
Cash and cash equivalents | | $ | | | $ | |
Restricted cash and cash equivalents included in other current assets | | | | | | |
Restricted cash and cash equivalents included in restricted funds | | | | | | |
Cash, cash equivalents and restricted cash and cash equivalents at end of period |
| $ | | | $ | |
See Notes to Condensed Consolidated Financial Statements.
4
WASTE MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In Millions, Except Shares in Thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Waste Management, Inc. Stockholders’ Equity | | | | |||||||||||||||||
| | | | | | | | | | | | | | | | Accumulated | | | | | | | | | |
| | | | | | | | | | Additional | | | | | Other | | | | | | | | | ||
| | | | | Common Stock | | Paid-In | | Retained | | Comprehensive | | Treasury Stock | | Noncontrolling | ||||||||||
|
| Total |
| Shares |
| Amounts |
| Capital |
| Earnings |
| Income (Loss) |
| Shares |
| Amounts |
| Interests | |||||||
Three Months Ended June 30: | | | | | | | | | | | | | | | | | | | | | | | | | |
2025 | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, March 31, 2025 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | |
Consolidated net income | |
| | | — | | | — | | | — | | | | | | — | | — | | | — | | | |
Other comprehensive income (loss), net of tax | |
| | | — | | | — | | | — | | | — | | | | | — | | | — | | | — |
Cash dividends declared of $ | |
| ( | | — | | | — | | | — | | | ( | | | — | | — | | | — | | | — |
Equity-based compensation transactions, net | |
| | | — | | | — | | | | | | — | | | — | | | | | | | | — |
Other, net | |
| ( | | — | | | — | | | — | | | — | | | — | | — | | | — | | | ( |
Balance, June 30, 2025 | | $ | | | | | $ | | | $ | | | $ | | | $ | |
| ( | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
2024 | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, March 31, 2024 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | ( |
Consolidated net income | |
| | | — | |
| — | |
| — | |
| | |
| — |
| — | |
| — | |
| — |
Other comprehensive income (loss), net of tax | |
| ( | | — | |
| — | |
| — | |
| — | |
| ( |
| — | |
| — | |
| — |
Cash dividends declared of $ | |
| ( | | — | |
| — | |
| — | |
| ( | |
| — |
| — | |
| — | |
| — |
Equity-based compensation transactions, net | |
| | | — | |
| — | |
| | |
| ( | |
| — |
| | |
| | |
| — |
Common stock repurchase program | |
| ( | | — | |
| — | |
| | |
| — | |
| — |
| ( | |
| ( | |
| — |
Adoption of new accounting standard | | | ( | | — | | | — | | | — | | | ( | | | — | | — | | | — | | | — |
Other, net | |
| — | | — | |
| — | |
| | |
| — | |
| — |
| | |
| — | |
| ( |
Balance, June 30, 2024 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | ( |
See Notes to Condensed Consolidated Financial Statements.
5
WASTE MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ─ (Continued)
(In Millions, Except Shares in Thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Waste Management, Inc. Stockholders’ Equity | | | | |||||||||||||||||
| | | | | | | | | | | | | | | | Accumulated | | | | | | | | | |
| | | | | | | | | | Additional | | | | | Other | | | | | | | | | ||
| | | | | Common Stock | | Paid-In | | Retained | | Comprehensive | | Treasury Stock | | Noncontrolling | ||||||||||
| | Total |
| Shares |
| Amounts |
| Capital |
| Earnings |
| Income (Loss) |
| Shares |
| Amounts |
| Interests | |||||||
Six Months Ended June 30: | | | | | | | | | | | | | | | | | | | | | | | | | |
2025 | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, December 31, 2024 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | |
Consolidated net income | |
| | | — | |
| — | |
| — | |
| | |
| — |
| — | |
| — | |
| |
Other comprehensive income (loss), net of tax | |
| | | — | |
| — | |
| — | |
| — | |
| |
| — | |
| — | |
| — |
Cash dividends declared of $ | |
| ( | | — | |
| — | |
| — | |
| ( | |
| — |
| — | |
| — | |
| — |
Equity-based compensation transactions, net | |
| | | — | |
| — | |
| | |
| | |
| — |
| | |
| | |
| — |
Other, net | |
| ( | | — | |
| — | |
| — | |
| — | |
| — |
| | |
| — | |
| ( |
Balance, June 30, 2025 | | $ | | | | | $ | | | $ | | | $ | | | $ | |
| ( | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
2024 | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, December 31, 2023 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | ( |
Consolidated net income | |
| | | — | |
| — | |
| — | |
| | |
| — |
| — | |
| — | |
| ( |
Other comprehensive income (loss), net of tax | |
| ( | | — | |
| — | |
| — | |
| — | |
| ( |
| — | |
| — | |
| — |
Cash dividends declared of $ | |
| ( | | — | |
| — | |
| — | |
| ( | |
| — |
| — | |
| — | |
| — |
Equity-based compensation transactions, net | |
| | | — | |
| — | |
| | |
| | |
| — |
| | |
| | |
| — |
Common stock repurchase program | |
| ( | | — | |
| — | |
| | |
| — | |
| — |
| ( | |
| ( | |
| — |
Adoption of new accounting standard | | | ( | | — | | | — | | | — | | | ( | | | — | | — | | | — | | | — |
Other, net | |
| | | — | |
| — | |
| | |
| — | |
| — |
| | |
| — | |
| |
Balance, June 30, 2024 | | $ | | | | | $ | | | $ | | | $ | | | $ | ( |
| ( | | $ | ( | | $ | ( |
See Notes to Condensed Consolidated Financial Statements.
6
1. Basis of Presentation
The financial statements presented in this report represent the consolidation of Waste Management, Inc., a Delaware corporation; its wholly-owned and majority-owned subsidiaries; and certain variable interest entities for which Waste Management, Inc. or its subsidiaries are the primary beneficiaries as described in Note 13. Waste Management, Inc. is a holding company and all operations are conducted by its subsidiaries. When the terms “the Company,” “we,” “us” or “our” are used in this document, those terms refer to Waste Management, Inc., together with its consolidated subsidiaries and consolidated variable interest entities. When we use the term “WMI,” we are referring only to Waste Management, Inc., the parent holding company.
We are North America’s leading provider of comprehensive environmental solutions, providing services throughout the United States (“U.S.”) and Canada. We partner with our customers and the communities we serve to manage and reduce waste at each stage from collection to disposal, while recovering valuable resources and creating clean, renewable energy. Our solid waste business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, recycling and resource recovery services. Through our subsidiaries, including our Waste Management Renewable Energy (“WM Renewable Energy”) segment, we are also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S. and Canada that produce renewable electricity and renewable natural gas (“RNG”), which is a significant source of fuel that we allocate to our natural gas fleet.
On November 4, 2024, we completed the acquisition of all outstanding shares of Stericycle, Inc. (“Stericycle”), the operations of which are presented in this report as our new WM Healthcare Solutions segment. The acquisition expands our offerings in the U.S. and Canada and adds operations in parts of Western Europe. These businesses provide regulated waste and compliance services and secure information destruction services that protect people and brands, promote health and well-being and safeguard the environment. Refer to Note 8 for further discussion.
Our senior management evaluates, oversees and manages the financial performance of our business through
The Condensed Consolidated Financial Statements as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows, and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.
In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with precision from available data or simply cannot be calculated. In some cases, these estimates are difficult to determine, and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, long-lived asset impairments, intangible asset impairments and the fair value of assets and liabilities acquired in business combinations. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements.
7
Revenue Recognition
We generally recognize revenue as services are performed or products are delivered. For example, revenue typically is recognized as waste is collected; tons are received at our landfills, transfer stations or processing facilities; or recycling and other commodities, such as RNG, electricity and capacity, Renewable Identification Numbers (“RINs”) and Renewable Energy Credits (“RECs”), are sold. Compliance services revenues are recognized over the contractual service period.
We also bill for certain services prior to performance. Such services include, among others, certain commercial and residential contracts and equipment rentals. These advanced billings are included in deferred revenues and recognized as revenue in the period service is provided. Substantially all our deferred revenues during the reported periods are realized as revenues within one to
Contract Acquisition Costs
Our incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are generally deferred and amortized to selling, general and administrative expense over the estimated life of the relevant customer relationship, ranging from five to
Leases
Amounts for our operating lease right-of-use assets are recorded in other long-term assets and the current and long-term portion of our operating lease liabilities are reflected in accrued liabilities and other long-term liabilities, respectively, in our Condensed Consolidated Balance Sheets. Amounts for our financing leases are recorded in property and equipment, net of accumulated depreciation and depletion, and current or long-term debt in our Condensed Consolidated Balance Sheets, as appropriate.
Concentrations of Credit Risk
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments held within restricted funds, and accounts receivable. We make efforts to control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with a diverse group of credit-worthy financial institutions; (ii) holding high-quality financial instruments while limiting investments in any one instrument and (iii) maintaining strict policies over credit extension that include credit evaluations, credit limits and monitoring procedures, although generally we do not have collateral requirements for credit extensions. We also control our exposure associated with trade receivables by discontinuing service, to the extent allowable, to non-paying customers. However, our overall credit risk associated with trade receivables is limited due to the large number and diversity of customers we serve.
Reclassifications
When necessary, reclassifications have been made to our prior period financial information to conform to the current year presentation and are not material to our Condensed Consolidated Financial Statements.
8
2. Landfill and Environmental Remediation Liabilities
Liabilities for landfill and environmental remediation costs are presented in the table below (in millions):
| | | | | | | | | | | | | | | | | | |
| | June 30, 2025 | | December 31, 2024 | ||||||||||||||
| | | | | Environmental | | | | | | | | Environmental | | | | ||
|
| Landfill |
| Remediation |
| Total |
| Landfill |
| Remediation |
| Total | ||||||
Current (in accrued liabilities) |
| $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
Long-term | |
| | |
| | |
| |
|
| | | | | | | |
|
| $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
The changes to landfill and environmental remediation liabilities for the six months ended June 30, 2025 are reflected in the table below (in millions):
| | | | | | |
| | | | | Environmental | |
|
| Landfill |
| Remediation | ||
December 31, 2024 | | $ | | | $ | |
Obligations incurred and capitalized | |
| |
|
| — |
Obligations settled | |
| ( |
|
| ( |
Interest accretion | |
| |
|
| — |
Revisions in estimates | |
| — |
|
| |
Acquisitions, divestitures and other adjustments | |
| |
|
| — |
June 30, 2025 | | $ | | | $ | |
At several of our landfills, we provide financial assurance by depositing cash into restricted trust funds for purposes of settling final capping, closure, post-closure and environmental remediation obligations. Generally, these trust funds are established to comply with statutory requirements and operating agreements. See Note 13 for additional information related to these trusts.
3. Debt
The following table summarizes the major components of debt at principal amounts as of each balance sheet date (in millions) and provides the maturities and interest rate ranges of each major category as of June 30, 2025:
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
Commercial paper program (weighted average interest rate of | | $ | | | $ | |
Senior notes, maturing through 2054, interest rates ranging from | | | | | | |
Canadian senior notes, C$ | |
| | | | |
Tax-exempt bonds, maturing through 2055, fixed and variable interest rates ranging from | |
| | |
| |
Financing leases and other, maturing through 2082 (weighted average interest rate of | |
| | |
| |
Debt issuance costs, discounts and other | |
| ( | |
| ( |
| |
| | |
| |
Current portion of long-term debt | |
| | |
| |
Long-term debt, less current portion | | $ | | | $ | |
| (a) | Excluding our landfill financing leases, the maturities of our financing leases and other debt obligations extend through 2059. |
9
Debt Classification
As of June 30, 2025, we had approximately $
Access to and Utilization of Credit Facilities and Commercial Paper Program
$3.5 Billion Revolving Credit Facility — Our $
Commercial Paper Program — We have a commercial paper program that enables us to borrow funds for up to
Other Letter of Credit Lines — As of June 30, 2025, we had utilized $
Debt Borrowings and Repayments
Commercial Paper Program — During the six months ended June 30, 2025, we had cash borrowings of $
Senior Notes — During the six months ended June 30, 2025, we repaid $
Senior Notes Exchange Offer – On November 8, 2024, we issued approximately $
10
On June 25, 2025, we completed an offer to exchange the outstanding Restricted Notes for new notes registered pursuant to the Securities Act of 1933, as amended (the “Registered Notes”). The terms of the Registered Notes are substantially identical in all material respects to the terms of the Restricted Notes, except that the Registered Notes will not be subject to restrictions on transfer. Approximately $
Tax-Exempt Bonds — We issued $
4. Income Taxes
Our effective income tax rate was
Our effective income tax rate was
We evaluate our effective income tax rate at each interim period and adjust it as facts and circumstances warrant.
Investments Qualifying for Federal Tax Credits
Renewable Natural Gas — Through our subsidiaries, including our WM Renewable Energy segment, we have invested in building landfill gas-to-energy facilities in the U.S. and Canada that produce renewable electricity and RNG. We expect our new RNG facilities to qualify for federal tax credits and to realize those credits through 2026 under Section 48 of the Internal Revenue Code.
During the three and six months ended June 30, 2025, we recognized a reduction in our income tax expense of $
Low-Income Housing — We have significant financial interests in entities established to invest in and manage low-income housing properties. We support the operations of these entities in exchange for a pro-rata share of the tax credits they generate. The low-income housing investments qualify for federal tax credits that we expect to realize through 2036 under Section 42 or Section 45D of the Internal Revenue Code.
Under the proportional amortization method, the equity investment is amortized in proportion to the income tax credits and other income tax benefits received. The amortization expense and the income tax credits are required to be presented on a net basis in income tax expense on the Condensed Consolidated Statements of Operations.
During the three and six months ended June 30, 2025, we recognized income tax expense of $
During the three and six months ended June 30, 2024, we recognized income tax expense of $
11
June 30, 2024, we recognized interest expense of $
5. Earnings Per Share
Basic and diluted earnings per share for the three and six months ended June 30 were computed using the following common share data (shares in millions):
| | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||
| | June 30, | | June 30, | ||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
Number of common shares outstanding at end of period |
| |
| |
| |
| |
Effect of using weighted average common shares outstanding |
| — |
| |
| ( |
| |
Weighted average basic common shares outstanding |
| |
| |
| |
| |
Dilutive effect of equity-based compensation awards and other contingently issuable shares |
| |
| |
| |
| |
Weighted average diluted common shares outstanding |
| |
| |
| |
| |
Potentially issuable shares |
| |
| |
| |
| |
Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding |
| |
| |
| |
| |
Refer to the Condensed Consolidated Statements of Operations for net income attributable to Waste Management, Inc.
6. Commitments and Contingencies
Financial Instruments — We have obtained letters of credit, surety bonds and insurance policies and have established trust funds and issued financial guarantees to support tax-exempt bonds, contracts, performance of landfill final capping, closure and post-closure requirements, environmental remediation and other obligations. Letters of credit generally are supported by our $
Management does not expect that any claims against or draws on these instruments would have a material adverse effect on our financial condition, results of operations or cash flows. We have not experienced any unmanageable difficulty in obtaining the required financial assurance instruments for our current operations. In an ongoing effort to mitigate risks of future cost increases and reductions in available capacity, we continue to evaluate various options to access cost-effective sources of financial assurance.
Insurance — We carry insurance coverage for protection of our assets and operations from certain risks including general liability, automobile liability, workers’ compensation, real and personal property, directors’ and officers’ liability, pollution legal liability, cyber incident liability and other coverages we believe are customary to the industry. Our exposure to loss for insurance claims is generally limited to the per-incident deductible under the related insurance policy and any amounts that exceed our insured limits. Our exposure could increase if our insurers are unable to meet their commitments on a timely basis.
We have retained a significant portion of the risks related to our health and welfare, general liability, automobile liability and workers’ compensation claims programs. “General liability” refers to the self-insured portion of specific third-party claims made against us that may be covered under our commercial general liability insurance policy. For our self-insured portions, the exposure for unpaid claims and associated expenses, including incurred but not reported losses, is based on an actuarial valuation or internal estimates. The accruals for these liabilities could be revised if future
12
occurrences or loss development significantly differ from such valuations and estimates. We use a wholly-owned insurance captive to insure the deductibles for our general liability, automobile liability and workers’ compensation claims programs.
We do not expect the impact of any known casualty, property, environmental or other contingency to have a material impact on our financial condition, results of operations or cash flows.
Guarantees — In the ordinary course of our business, WMI and WM Holdings enter into guarantee agreements associated with their subsidiaries’ operations. Additionally, WMI and WM Holdings have each guaranteed all of the senior debt of the other entity. No additional liabilities have been recorded for these intercompany guarantees because all of the underlying obligations are reflected in our Condensed Consolidated Balance Sheets.
As of June 30, 2025, we have guaranteed the obligations and certain performance requirements of third parties in connection with both consolidated and unconsolidated entities, including guarantees to cover the difference, if any, between the sale value and the guaranteed market or contractually-determined value of certain homeowner’s properties that are adjacent to or near
Environmental Matters — A significant portion of our operating costs and capital expenditures could be characterized as costs of environmental protection. The nature of our operations, particularly with respect to the construction, operation and maintenance of our landfills, subjects us to an array of laws and regulations relating to the protection of the environment. Under current laws and regulations, we may have liabilities for environmental damage caused by our operations, or for damage caused by conditions that existed before we acquired a site. In addition to remediation activity required by state or local authorities, such liabilities include potentially responsible party (“PRP”) investigations. The costs associated with these liabilities can include settlements, certain legal and consultant fees, as well as incremental internal and external costs directly associated with site investigation and clean-up.
Estimating our degree of responsibility for remediation is inherently difficult. We recognize and accrue for an estimated remediation liability when we determine that such liability is both probable and reasonably estimable. Determining the method and ultimate cost of remediation requires that a number of assumptions be made. There can sometimes be a range of reasonable estimates of the costs associated with the likely site remediation alternatives identified in the environmental impact investigation. In these cases, we use the amount within the range that is our best estimate. If no amount within a range appears to be a better estimate than any other, we use the amount that is the low end of such range. If we used the high ends of such ranges (where estimable), our aggregate potential liability would be approximately $
As of June 30, 2025, we had been notified by the government that we are a PRP in connection with
13
The majority of proceedings involving NPL sites that we do not own are based on allegations that certain of our subsidiaries (or their predecessors) transported hazardous substances to the sites, often prior to our acquisition of these subsidiaries. CERCLA generally provides for liability for those parties owning, operating, transporting to or disposing at the sites. Proceedings arising under Superfund typically involve numerous waste generators and other waste transportation and disposal companies and seek to allocate or recover costs associated with site investigation and remediation, which costs could be substantial and could have a material adverse effect on our consolidated financial statements. At some of the sites at which we have been identified as a PRP, our liability is well defined as a consequence of a governmental decision and an agreement among liable parties as to the share each will pay for implementing that remedy. At other sites, where no remedy has been selected or the liable parties have been unable to agree on an appropriate allocation, our future costs are uncertain.
In 2018, both of McGinnes Industrial Maintenance Corporation (“MIMC”), a subsidiary of Waste Management of Texas, Inc., and International Paper Company (“IPC”) entered into an Administrative Order on Consent with the EPA as PRPs to develop a remedial design for the San Jacinto River Waste Pits Superfund Site in Harris County, Texas. We recorded a liability for MIMC’s estimated potential share of the EPA’s proposed remedy and related costs, although allocation of responsibility among the PRPs for the proposed remedy has not been established. In November 2024, MIMC and IPC publicly issued a proposed revised full remedial design. The EPA’s comments were received in April 2025, and MIMC and IPC provided responses to those comments later that month. Due to increases in the estimated costs of the remedy to address the EPA’s comments, in the fourth quarter of 2024 we recorded an additional $
Item 103 of the SEC’s Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings, or such proceedings are known to be contemplated, unless we reasonably believe that the matter will result in no monetary sanctions, or in monetary sanctions, exclusive of interest and costs, below a stated threshold. In accordance with this SEC regulation, the Company uses a threshold of $
From time to time, we are also named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of having owned, operated or transported waste to a disposal facility that is alleged to have contaminated the environment or, in certain cases, on the basis of having conducted environmental remediation activities at sites. Some of the lawsuits may seek to have us pay the costs of monitoring of allegedly affected sites and health care examinations of allegedly affected persons for a substantial period of time even where no actual damage is proven. While we believe we have meritorious defenses to these lawsuits, the ultimate resolution is often substantially uncertain due to the difficulty of determining the cause, extent and impact of alleged contamination (which may have occurred over a long period of time), the potential for successive groups of complainants to emerge, the diversity of the individual plaintiffs’ circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties, among other factors. Additionally, we often enter into agreements with landowners imposing obligations on us to meet certain regulatory or contractual conditions upon site closure or upon termination of the agreements. Compliance with these agreements inherently involves subjective determinations and may result in disputes, including litigation.
Litigation — We are subject to various proceedings, lawsuits, disputes and claims arising in the ordinary course of our business. Many of these actions raise complex factual and legal issues and are subject to uncertainties. Actions that have been filed against us, and that may be filed against us in the future, include personal injury, property damage, commercial, customer, and employment-related claims, including purported state and national class action lawsuits related to: alleged environmental contamination, including releases of hazardous material and odors; sales and marketing practices, customer service agreements and prices and fees; and federal and state wage and hour and other laws. The plaintiffs in some actions seek unspecified damages or injunctive relief, or both. These actions are in various procedural stages, and some are covered, in part, by insurance. We currently do not believe that the eventual outcome of any such
14
actions will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.
On November 4, 2024, the Company acquired Stericycle. At the time of the acquisition, Stericycle was subject to the following legal matters, which are now legal matters of our wholly-owned subsidiary.
Stericycle entered into a deferred prosecution agreement (“DPA”) with the U.S. Department of Justice (“DOJ”) and a cease-and-desist order with the SEC in 2022 relating to Stericycle’s compliance with the U.S. Foreign Corrupt Practices Act and other anti-corruption laws with respect to now-divested operations in Latin America. The DPA and cease-and-desist order required Stericycle to engage an independent compliance monitor for two years, which Stericycle satisfied. Additionally, the DPA required Stericycle to self-report any potential violations of the anti-corruption laws through November 2025. In April 2025, the DOJ filed, and the court granted, a motion for early termination of the DPA, and the deferred charges against Stericycle have been dismissed with prejudice. This matter did not have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.
On February 11, 2020, Stericycle received an administrative subpoena from the U.S. Drug Enforcement Administration (“DEA”), which executed a search warrant at a facility in Rancho Cordova, California and an administrative inspection warrant at a facility in Indianapolis, Indiana for materials related to Stericycle’s now-divested Domestic Environmental Solutions business of collecting, transporting, and destroying controlled substances from retail customers (the “ESOL Retail Controlled Substances Business”). On that same day, agents from the California Department of Toxic Substances Control executed a separate search warrant at the Rancho Cordova facility. Since that time, the U.S. Attorney’s Office for the Eastern District of California (“USAO EDCA”) has been overseeing criminal and civil investigations of the ESOL Retail Controlled Substances Business. The USAO EDCA informed Stericycle that the investigations relate to Stericycle’s operation and sale of its ESOL Retail Controlled Substances Business that was divested in 2020 and has asserted that Stericycle and some of Stericycle’s current or former employees may have civil and criminal liability under the Controlled Substances Act and other federal statutes related to that business. Stericycle has been cooperating with the ongoing investigations, which are limited to the period of Stericycle’s historical operation and ownership of the ESOL Retail Controlled Substances Business from 2015 through 2020. While the ultimate disposition of this matter remains uncertain, we do not currently believe that it will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.
In June 2022, we and certain of our officers were named as defendants in a complaint alleging violation of the federal securities laws and seeking certification as a class action in the U.S. District Court for the Southern District of New York. A lead plaintiff was appointed and an amended complaint was filed in January 2023. The amended complaint sought damages on behalf of a putative class of secondary market purchasers of our senior notes with a special mandatory redemption feature issued in May 2019, asserting claims under the Securities Exchange Act of 1934, as amended, based on alleged misrepresentations and omissions concerning the anticipated time for completion of our acquisition of Advanced Disposal. In July 2025, the parties filed a motion for preliminary approval of a settlement that is now pending court approval. The proposed settlement will be covered by insurance, and we do not believe that the eventual outcome of this matter will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.
WMI’s charter and bylaws provide that WMI shall indemnify against all liabilities and expenses, and upon request shall advance expenses to any person, who is subject to a pending or threatened proceeding because such person is or was a director or officer of the Company. Such indemnification is required to the maximum extent permitted under Delaware law. Accordingly, the director or officer must execute an undertaking to reimburse the Company for any fees advanced if it is later determined that the director or officer was not permitted to have such fees advanced under Delaware law. Additionally, the Company has direct contractual obligations to provide indemnification to each of the members of WMI’s Board of Directors and each of WMI’s executive officers. The Company may incur substantial expenses in connection with the fulfillment of its advancement of costs and indemnification obligations in connection with actions or proceedings that may be brought against its former or current officers, directors and employees.
15
Multiemployer Defined Benefit Pension Plans — About
We do not believe that any future liability relating to our past or current participation in, or withdrawals from, the Multiemployer Pension Plans to which we contribute will have a material adverse effect on our business, financial condition or liquidity. However, liability for future withdrawals could have a material adverse effect on our results of operations or cash flows for a particular reporting period, depending on the number of employees withdrawn and the financial condition of the Multiemployer Pension Plan(s) at the time of such withdrawal(s).
Tax Matters — We maintain a liability for uncertain tax positions, the balance of which management believes is adequate. Results of audit assessments by taxing authorities are not currently expected to have a material adverse effect on our financial condition, results of operations or cash flows. We participate in the IRS’s Compliance Assurance Process, which means we work with the IRS throughout the year towards resolving any material issues prior to the filing of our annual tax return. Any unresolved issues as of the tax return filing date are subject to routine examination procedures. In the fourth quarter of 2022, the Company received a notice of tax due for the 2017 tax year related to a remaining disagreement with the IRS. In response to the notice, the Company made a deposit of approximately $
7. Segment and Related Information
Our senior management evaluates, oversees and manages the financial performance of our business through
16
Summarized financial information concerning our reportable segments for the three and six months ended June 30 is shown in the following table (in millions):
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net | | Intercompany | | Gross | | | | Selling, | | Other | | Depreciation, |
| Income |
| Capital | |||||||||
| | Operating | | Operating | | Operating | | Operating | | General and | | Net | | Depletion and |
| from |
| Expenditures | |||||||||
|
| Revenues |
| Revenues(a) |
| Revenues |
| Expenses |
| Administrative |
| Expenses(f) |
| Amortization |
| Operations(b) |
| (c) | |||||||||
Three Months Ended June 30: |
| |
|
| |
|
| |
|
| |
| | | | | | | | | | | | | | | |
2025 |
| |
|
| |
|
| |
|
| |
| | | | | | | | | | | | | | | |
Collection and Disposal: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
| | |
| | |
|
East Tier | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
West Tier | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Other Ancillary | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| |
Collection and Disposal(d)(e) | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Recycling Processing and Sales(d) | |
| | | | | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
WM Renewable Energy(e) | | | | | | — | | | | | | | | | | | | — | | | | | | | | | |
WM Healthcare Solutions | | | | | | | | | | | | | | | | | | | | | | | | ( | | | |
Corporate and Other(e) | |
| | | | | |
| | |
| | |
| | |
| — | |
| | |
| ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intercompany Elimination | | | | | | | | | ( | | | ( | | | ( | | | — | | | — | | | — | | | |
Net | | | | | | | | | 6,430 | | | 3,839 | | | 696 | | | 36 | | | 708 | | | 1,151 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| |
|
| |
|
| |
|
| |
|
| | | | | | | | | | | | | | | |
| |
|
| |
|
| |
|
| |
|
| | | | | | | | | | | | | | | |
| | Net | | Intercompany | | Gross | | | | Selling, | | Other | | Depreciation, |
| Income |
| Capital | |||||||||
| | Operating | | Operating | | Operating | | Operating | | General and | | Net | | Depletion and |
| from |
| Expenditures | |||||||||
| | Revenues |
| Revenues(a) |
| Revenues |
| Expenses |
| Administrative |
| Expenses(f) |
| Amortization |
| Operations(b) |
| (c) | |||||||||
2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Collection and Disposal: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
| | |
| | |
|
East Tier | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
West Tier | |
| | |
| | |
| | |
| | |
| | |
| — | |
| | |
| | |
| |
Other Ancillary | |
| | |
| | |
| | |
| | |
| | |
| — | |
| | |
| ( | |
| |
Collection and Disposal(d)(e) | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Recycling Processing and Sales(d) | |
| | | | | |
| | |
| | |
| | |
| — | |
| | |
| | |
| |
WM Renewable Energy(e) | | | | | | | | | | | | | | | | | | — | | | | | | | | | |
Corporate and Other(e) | |
| | | | | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| |
Total | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intercompany Elimination | | | | | | | | | ( | | | ( | | | ( | | | — | | | — | | | — | | | |
Net | | | | | | | | | 5,402 | | | 3,291 | | | 501 | | | 58 | | | 543 | | | 1,009 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
17
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net | | Intercompany | | Gross | | | | Selling, | | Other | | Depreciation, |
| Income |
| Capital | |||||||||
| | Operating | | Operating | | Operating | | Operating | | General and | | Net | | Depletion and |
| from |
| Expenditures | |||||||||
|
| Revenues |
| Revenues(a) |
| Revenues |
| Expenses |
| Administrative |
| Expenses(f) |
| Amortization |
| Operations(b) |
| (c) | |||||||||
Six Months Ended June 30: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
2025 |
| |
|
| |
|
| |
|
| |
| | | | | | | | | | | | | | | |
Collection and Disposal: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
| | |
| | |
|
East Tier | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
West Tier | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Other Ancillary | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| |
Collection and Disposal(d)(e) | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Recycling Processing and Sales(d) | |
| | | | | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
WM Renewable Energy(e) | | | | | | | | | | | | | | | | | | — | | | | | | | | | |
WM Healthcare Solutions | | | | | | | | | | | | | | | | | | | | | | | | ( | | | |
Corporate and Other(e) | |
| | | | | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intercompany Elimination | | | | | | | | | ( | | | ( | | | ( | | | — | | | — | | | — | | | |
Net | | | | | | | | | 12,448 | | | 7,486 | | | 1,383 | | | 51 | | | 1,364 | | | 2,164 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| |
|
| |
|
| |
|
| |
|
| | | | | | | | | | | | | | | |
| |
|
| |
|
| |
|
| |
|
| | | | | | | | | | | | | | | |
| | Net | | Intercompany | | Gross | | | | Selling, | | Other | | Depreciation, |
| Income |
| Capital | |||||||||
| | Operating | | Operating | | Operating | | Operating | | General and | | Net | | Depletion and |
| from |
| Expenditures | |||||||||
| | Revenues |
| Revenues(a) |
| Revenues |
| Expenses |
| Administrative |
| Expenses(f) |
| Amortization |
| Operations(b) |
| (c) | |||||||||
2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Collection and Disposal: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
| | |
| | |
|
East Tier | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
West Tier | |
| | |
| | |
| | |
| | |
| | |
| — | |
| | |
| | |
| |
Other Ancillary | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| | |
| ( | |
| |
Collection and Disposal(d)(e) | |
| | |
| | |
| | |
| | |
| | |
| — | |
| | |
| | |
| |
Recycling Processing and Sales(d) | |
| | | | | |
| | |
| | |
| | |
| — | |
| | |
| | |
| |
WM Renewable Energy(e) | | | | | | | | | | | | | | | | | | — | | | | | | | | | |
Corporate and Other(e) | |
| | | | | |
| | |
| | |
| | |
| | |
| | |
| ( | |
| |
Total | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intercompany Elimination | | | | | | | | | ( | | | ( | | | ( | | | — | | | — | | | — | | | |
Net | | | | | | | | | 10,561 | | | 6,431 | | | 992 | | | 56 | | | 1,057 | | | 2,025 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (a) | Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. |
| (b) | For those items included in the determination of income from operations, the accounting policies of the segments are the same as those described in Note 1. |
| (c) | Includes non-cash items. Additionally, our Corporate and Other business recognizes construction work in progress for fleet purchases during the period. Capital expenditures are reported in our reportable segments at the time they are recorded within the segments’ property and equipment balances and, therefore, include timing differences for amounts accrued but not yet paid as well as amounts transferred from Corporate and Other for fleet placed in service. |
| (d) | Certain fees related to the processing of recyclable material we collect are included within our Collection and Disposal businesses. The amounts in income from operations for the three and six months ended June 30, 2025 are $ |
| (e) | WM Renewable Energy pays a |
18
| respectively. Prior to the fourth quarter of 2024, amounts related to intercompany royalty payments were adjusted through income from operations. Prior periods have been recast to conform to current year presentation. |
| (f) | Other net expenses include restructuring expenses, (gain) loss from divestitures, and asset impairments and unusual items, net. |
Total assets by reportable segment are presented in the table below as follows (in millions):
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
Collection and Disposal: | | | | | | |
East Tier | | $ | | | $ | |
West Tier | | | | | | |
Other Ancillary | | | | | | |
Collection and Disposal | | | | | | |
Recycling Processing and Sales | |
| | |
| |
WM Renewable Energy | |
| | |
| |
WM Healthcare Solutions | | | | | | |
Corporate and Other | | | | | | |
Elimination of intercompany investments and advances | | | ( | | | ( |
Total assets, per Condensed Consolidated Balance Sheet | | $ | | | $ | |
19
The mix of operating revenues from our major lines of business for the three and six months ended June 30 are as follows (in millions):
| | | | | | | | | |
| | Net | | Intercompany | | Gross | |||
|
| Operating | | Operating | | Operating | |||
| | Revenues |
| Revenues (a)(b) |
| Revenues | |||
Three Months Ended June 30: | | | | | | | | | |
2025 |
| | | | | | | | |
Commercial |
| $ | | | $ | | | $ | |
Industrial | |
| | | | | |
| |
Residential | | | | | | | | | |
Other collection | |
| | |
| | |
| |
Total collection | |
| | |
| | |
| |
Landfill | | | | | | | | | |
Transfer | | | | | | | | | |
Total Collection and Disposal | |
| | |
| | |
| |
Recycling Processing and Sales | |
| | |
| | |
| |
WM Renewable Energy | |
| | |
| — | |
| |
WM Healthcare Solutions | | | | | | | | | |
Corporate and Other | | | | | | | | | |
Total | | $ | | | $ | | | $ | |
| | | | | | | | | |
2024 | | | | | | | | | |
Commercial |
| $ | | | $ | | | $ | |
Industrial | |
| | | | | |
| |
Residential | | | | | | | | | |
Other collection | |
| | |
| | |
| |
Total collection | |
| | |
| | |
| |
Landfill | | | | | | | | | |
Transfer | | | | | | | | | |
Total Collection and Disposal | |
| | |
| | |
| |
Recycling Processing and Sales | |
| | |
| | |
| |
WM Renewable Energy | |
| | |
| | |
| |
Corporate and Other | | | | | | | | | |
Total | | $ | | | $ | | | $ | |
20
| | | | | | | | | |
| | Net | | Intercompany | | Gross | |||
|
| Operating | | Operating | | Operating | |||
| | Revenues |
| Revenues (a)(b) |
| Revenues | |||
Six Months Ended June 30: | | | | | | | | | |
2025 |
| | | | | | | | |
Commercial |
| $ | | | $ | | | $ | |
Industrial | |
| | | | | |
| |
Residential | | | | | | | | | |
Other collection | |
| | |
| | |
| |
Total collection | |
| | |
| | |
| |
Landfill | | | | | | | | | |
Transfer | | | | | | | | | |
Total Collection and Disposal | |
| | |
| | |
| |
Recycling Processing and Sales | |
| | |
| | |
| |
WM Renewable Energy | |
| | |
| | |
| |
WM Healthcare Solutions | | | | | | | | | |
Corporate and Other | | | | | | | | | |
Total | | $ | | | $ | | | $ | |
| | | | | | | | | |
2024 | | | | | | | | | |
Commercial |
| $ | | | $ | | | $ | |
Industrial | |
| | | | | |
| |
Residential | | | | | | | | | |
Other collection | |
| | |
| | |
| |
Total collection | |
| | |
| | |
| |
Landfill | | | | | | | | | |
Transfer | | | | | | | | | |
Total Collection and Disposal | |
| | |
| | |
| |
Recycling Processing and Sales | |
| | |
| | |
| |
WM Renewable Energy | |
| | |
| | |
| |
Corporate and Other | | | | | | | | | |
Total | | $ | | | $ | | | $ | |
| (a) | Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. |
| (b) | Beginning with the 2024 Form 10-K, the Company adjusted gross and intercompany operating revenues to reflect the |
Our financial and operating results may fluctuate for many reasons, including period-to-period changes in the relative contribution of revenue by each line of business, changes in commodity prices and general economic conditions. Our operating revenues and volumes typically experience seasonal increases in the summer months that are reflected in second and third quarter revenues and results of operations.
Service or operational disruptions caused by severe storms, extended periods of inclement weather or climate events can significantly affect the operating results of the geographic areas affected. Extreme weather events may also lead to supply chain disruption and delayed project development, or disruption of our customers’ businesses, reducing the amount of waste generated by their operations.
Conversely, certain destructive weather and climate conditions, such as wildfires in the Western U.S. and hurricanes that most often impact our operations in the Southern and Eastern U.S. during the second half of the year, can increase our
21
revenues in the geographic areas affected as a result of the waste volumes generated by these events. While weather-related and other event-driven special projects can boost revenues through additional work for a limited time, due to significant start-up costs and other factors, such revenue can generate earnings at comparatively lower margins.
8. Acquisitions and Divestitures
Acquisitions
Stericycle Acquisition
On June 3, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) to acquire all outstanding shares of Stericycle for $
Our Condensed Consolidated Financial Statements have not been retroactively restated to include Stericycle’s historical financial position or results of operations. The acquisition is accounted for as a business combination. In accordance with the purchase method of accounting, the purchase price paid has been allocated to the assets and liabilities acquired based upon their estimated fair values as of the acquisition date, with the excess of the purchase price over the net assets acquired recorded as goodwill.
Our estimates and assumptions are subject to change during the measurement period, not to exceed one year from the acquisition date. The areas of acquisition accounting that are not yet finalized primarily relate to (i) finalizing the review and valuation of trade names, permits, customer relationships and certain property plant and equipment and other intangibles (including the models, key assumptions, estimates and inputs used) and assignment of remaining useful lives associated with the depreciable and amortizable assets and (ii) finalizing the review and valuation of accounts receivable, accrued expenses, contingent liabilities, deferred taxes and goodwill (including key assumptions, inputs and estimates).
Goodwill of $
22
The following table shows the preliminary purchase price allocation as of the date acquired and adjustments to June 30, 2025 (in millions):
| | | | | | | | | |
|
| November 4, 2024 | | | Adjustments |
| June 30, 2025 | ||
Cash and cash equivalents | | $ | | | $ | — | | $ | |
Accounts and other receivables | |
| | |
| ( | |
| |
Parts and supplies | |
| |
|
| — |
|
| |
Other current assets | | | | | | ( | | | |
Assets held for sale (a) | | | | | | ( | | | |
Property and equipment | | | | | | ( | | | |
Goodwill | | | | | | | | | |
Other intangible assets | | | | | | ( | | | |
Other assets | | | | | | ( | | | |
Accounts payable | | | ( | | | | | | ( |
Accrued liabilities | | | ( | | | ( | | | ( |
Deferred revenues | | | ( | | | — | | | ( |
Current portion of long-term debt | | | ( | | | — | | | ( |
Liabilities held for sale (a) | | | ( | | | — | | | ( |
Long-term debt, less current portion | | | ( | | | — | | | ( |
Deferred income taxes | | | ( | | | | | | ( |
Other liabilities | | | ( | | | — | | | ( |
Total purchase price | | $ | | | $ | ( | | $ | |
| (a) | Represents Stericycle’s Spain and Portugal subsidiaries. See “Divestitures” below for additional information. |
The preliminary allocation of $
2025 Acquisitions
During the six months ended June 30, 2025, we completed solid waste and recycling acquisitions with total consideration of $
Total consideration for our 2025 acquisitions was primarily allocated to $
Divestitures
On January 2, 2025, we completed the sale of our WM Healthcare Solutions’ Spain and Portugal subsidiaries. As the fair value of consideration transferred was equal to the carrying value of the divested subsidiaries, no gain or loss was recognized.
23
9. (Gain) Loss from Divestitures, Asset Impairments and Unusual Items, Net
(Gain) loss from divestitures, asset impairments and unusual items, net for the three and six months ended June 30, 2025, primarily relates to a $
(Gain) loss from divestitures, asset impairments and unusual items, net for the three and six months ended June 30, 2024 primarily relates to a $
10. Accumulated Other Comprehensive Income (Loss)
The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, which is included as a component of Waste Management, Inc. stockholders’ equity, are as follows (in millions, with amounts in parentheses representing decreases to accumulated other comprehensive income):
| | | | | | | | | | | | | | | |
| | | | | | | | Foreign | | Post- | | | | ||
| | | | | Available- | | Currency | | Retirement | | | | |||
| | Derivative | | for-Sale | | Translation | | Benefit | | | | ||||
|
| Instruments |
| Securities |
| Adjustments |
| Obligations |
| Total | |||||
Balance, December 31, 2024 | | $ | | | $ | | | $ | ( | | $ | | | $ | ( |
Other comprehensive income (loss) before reclassifications, net of tax expense (benefit) of $( | |
| | |
| | |
| | |
| — | |
| |
Amounts reclassified from accumulated other comprehensive (income) loss, net of tax (expense) benefit of $( | |
| ( | | | — | |
| — | | | — | |
| ( |
Net current period other comprehensive income (loss) | |
| ( | |
| | |
| | |
| — | |
| |
Balance, June 30, 2025 | | $ | | | $ | | | $ | ( | | $ | | | $ | |
11. Common Stock Repurchase Program
The Company repurchases shares of its common stock as part of capital allocation programs authorized by our Board of Directors.
There were
12. Fair Value Measurements
Assets and Liabilities Accounted for at Fair Value
Our assets and liabilities that are measured at fair value on a recurring basis include the following (in millions):
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
Quoted prices in active markets (Level 1): | | | | | | |
Cash equivalents and money market funds |
| $ | |
| $ | |
Equity securities | | | | | | |
Significant other observable inputs (Level 2): | | | | | | |
Available-for-sale securities (a) |
| | |
| | |
Total assets measured at fair value |
| $ | | | $ | |
| (a) | Our available-for-sale securities primarily relate to debt securities with maturities over the next ten years. |
24
Fair Value of Debt
As of June 30, 2025 and December 31, 2024, the carrying value of our debt was $
Although we have determined the estimated fair value amounts using available market information and commonly accepted valuation methodologies, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange. The use of different assumptions or estimation methodologies could have a material effect on the estimated fair values. The fair value estimates are based on Level 2 inputs of the fair value hierarchy available as of June 30, 2025 and December 31, 2024. These amounts have not been revalued since those dates, and current estimates of fair value could differ significantly from the amounts presented.
See Note 8 for information related to the nonrecurring fair value measurement of assets and liabilities acquired in connection with our acquisition of Stericycle. See Note 9 for information related to our nonrecurring fair value measurements.
13. Variable Interest Entities
The following is a description of our financial interests in unconsolidated and consolidated variable interest entities that we consider significant:
Low-Income Housing Properties
We do not consolidate our investments in entities established to manage low-income housing properties because we are not the primary beneficiary of these entities as we do not have the power to individually direct the activities of these entities. Our aggregate investment balance in these entities was $
Trust Funds for Final Capping, Closure, Post-Closure or Environmental Remediation Obligations
Unconsolidated Variable Interest Entities — Trust funds that are established for both the benefit of the Company and the host community in which we operate are not consolidated because we are not the primary beneficiary of these entities as (i) we do not have the power to direct the significant activities of the trusts or (ii) power over the trusts’ significant activities is shared. Our interests in these trusts are accounted for as investments in unconsolidated entities and receivables. These amounts are recorded in other receivables, investments in unconsolidated entities and other long-term assets in our Condensed Consolidated Balance Sheets, as appropriate. We also reflect our share of the unrealized gains and losses on available-for-sale securities held by these trusts as a component of our accumulated other comprehensive income (loss). Our investments and receivables related to these trusts had an aggregate carrying value of $
Consolidated Variable Interest Entities — Trust funds for which we are the sole beneficiary are consolidated because we are the primary beneficiary. These trust funds are recorded in restricted funds in our Condensed Consolidated Balance Sheets. Unrealized gains and losses on available-for-sale securities held by these trusts are recorded as a component of accumulated other comprehensive income (loss). These trusts had a fair value of $
25
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements and notes thereto included under Item 1 and our Consolidated Financial Statements and notes thereto and related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2024.
This Quarterly Report on Form 10-Q contains certain forward-looking statements that are made subject to the safe harbor protections provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are often identified by the words, “will,” “may,” “should,” “continue,” “anticipate,” “believe,” “expect,” “plan,” “forecast,” “project,” “estimate,” “intend,” and words of a similar nature and include estimates or projections of financial and other data; comments on expectations relating to future periods; plans or objectives for the future; and statements of opinions, views or beliefs about current and future events, circumstances or performance. You should view these statements with caution. They are based on the facts and circumstances known to us as of the date the statements are made. These forward looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those set forth in such forward-looking statements, including but not limited to failure to implement our optimization, automation, growth and cost savings initiatives and overall business strategy; failure to obtain the results anticipated from strategic initiatives, investments, acquisitions or new lines of business; failure to identify acquisition targets, consummate and integrate acquisitions, including our ability to integrate the acquisition of Stericycle and achieve the anticipated benefits therefrom, including synergies; legal, regulatory and other matters that may affect the costs and timing of our ability to integrate and deliver all of the expected benefits of the Stericycle acquisition; failure to maintain an effective system of internal control over financial reporting; existing or new environmental and other regulations, including developments related to emerging contaminants, gas emissions, renewable energy, extended producer responsibility and our natural gas fleet; significant environmental, safety or other incidents resulting in liabilities or brand damage; failure to obtain and maintain necessary permits due to land scarcity, public opposition or otherwise; diminishing landfill capacity, resulting in increased costs and the need for disposal alternatives; exposure to different regulatory, legal, financial and economic conditions in international jurisdictions; failure to attract, hire and retain key team members and a high quality workforce; increases in labor costs due to union organizing activities or changes in wage and labor related regulations; disruption and costs resulting from severe weather and destructive climate events; failure to achieve our sustainability goals or execute on our sustainability-related strategy and initiatives, including within planned timelines or anticipated budgets due to disruptions, delays, cost increases or changes in environmental or tax regulations and incentives; focus on and regulation of, environmental and sustainability-related disclosures, which could lead to increased costs, risk of non-compliance, brand damage and litigation risk related to our sustainability efforts; macroeconomic conditions, geopolitical conflict and large-scale market disruption resulting in labor, supply chain and transportation constraints, inflationary cost pressures and fluctuations in commodity prices, fuel and other energy costs; increased competition; pricing actions; impacts from international trade restrictions and tariffs; competitive disposal alternatives, diversion of waste from landfills and declining waste volumes; changing conditions in the healthcare industry; weakness in general economic conditions and capital markets; instability of financial institutions; adoption of new tax legislation; fuel shortages; failure to develop and protect new technology; failure of technology to perform as expected; failure to prevent, detect and address cybersecurity incidents or comply with privacy regulations; inability to adapt and manage the benefits and risks of artificial intelligence; negative outcomes of litigation or governmental proceedings, including those acquired through transactions; and operational or management decisions or developments that result in impairment charges and other risks discussed in our filings with the SEC, including Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. We assume no obligation to update any forward-looking statement, including financial estimates and forecasts, whether as a result of future events, circumstances or developments or otherwise.
Overview
We are North America’s leading provider of comprehensive environmental solutions, providing services throughout the United States (“U.S.”) and Canada. We partner with our customers and the communities we serve to manage and reduce waste at each stage from collection to disposal, while recovering valuable resources and creating clean, renewable
26
energy. We own or operate the largest network of landfills throughout the U.S. and Canada. In order to make disposal more practical for larger urban markets, where the distance to landfills is typically farther, we manage transfer stations that consolidate, compact and transport waste efficiently and economically. Our solid waste business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, recycling and resource recovery services. Through our subsidiaries, including our Waste Management Renewable Energy (“WM Renewable Energy”) segment, we are also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S. and Canada that produce renewable electricity and renewable natural gas (“RNG”), which is a significant source of fuel that we allocate to our natural gas fleet. Additionally, we are a leading recycler in the U.S. and Canada, handling materials that include paper, cardboard, glass, plastic and metal.
Our senior management evaluates, oversees and manages the financial performance of our business through five reportable segments, referred to as (i) Collection and Disposal - East Tier (“East Tier”); (ii) Collection and Disposal - West Tier (“West Tier”); (iii) Recycling Processing and Sales; (iv) WM Renewable Energy and (v) WM Healthcare Solutions. Our East and West Tiers, along with certain ancillary services (“Other Ancillary”) that are not managed through our Tier segments, but that support our collection and disposal operations, form our “Collection and Disposal” businesses. We also provide additional services not managed through our five reportable segments, which are presented as Corporate and Other.
Stericycle Acquisition
On November 4, 2024, we completed our acquisition of all outstanding shares of Stericycle, Inc., a provider of regulated waste and compliance services and secure information destruction services that protect people and brands, promote health and well-being and safeguard the environment. The post-closing operating results of Stericycle have been included in our Condensed Consolidated Financial Statements as a new reportable segment referred to as WM Healthcare Solutions. During the first half of 2025, we continued to prioritize service delivery for our customers and the integration of operations into WM’s organizational structure, ensuring business alignment with WM’s core values and capturing synergies through reduction of duplicative processes and costs. Additional efforts focused on business integration and process optimization through technological enhancements, establishing a performance management approach aimed at accountability and improving utilization of the asset portfolio.
Strategy
Our fundamental strategy has not changed; we remain dedicated to providing long-term value to our stockholders by successfully executing our core strategy of focused differentiation and continuous improvement. We have enabled a people-first, technology-led focus to drive our mission to maximize resource value, while minimizing environmental impact, and sustainability and environmental stewardship is embedded in all that we do. Our strategy leverages and sustains the strongest asset network in the industry to drive best-in-class customer experience and growth. Our strategic planning processes appropriately consider that the future of our business and the industry can be influenced by changes in economic conditions, the competitive landscape, the regulatory environment, asset and resource availability and technology. We believe that focused differentiation, which is driven by capitalizing on our unique and extensive network of assets, will deliver profitable growth and position us to leverage competitive advantages. Simultaneously, we believe that investing in automation to improve processes and drive operational efficiency combined with a focus on the cost to serve our customers will yield an attractive profit margin and enhanced service quality. We are furthering our strategy of focused differentiation and continuous improvement beyond our traditional waste operations through our sustainability growth strategy that includes significant investments in our WM Renewable Energy and Recycling Processing and Sales segments, while increasing automation and reducing labor dependency. In addition, with our acquisition of Stericycle, we have advanced our growth strategy and built upon our sustainability initiatives. The acquisition provides a complementary business platform in regulated waste and compliance services involving medical waste, a sector with attractive near- and long-term growth dynamics and in secure information destruction services to further our leading suite of comprehensive waste and environmental solutions. Furthermore, we are also evaluating and pursuing emerging diversion technologies that may generate additional value.
27
Business Environment
The waste industry is a comparatively mature and stable industry. However, customers increasingly expect more of their waste materials to be recovered and those waste streams are becoming more complex. In addition, many state and local governments mandate diversion, recycling and waste reduction at the source and prohibit the disposal of certain types of waste at landfills. We monitor these developments to adapt our service offerings. As companies, individuals and communities look for ways to be more sustainable, we promote our comprehensive services that go beyond our core business of collecting and disposing of waste in order to meet their needs. This includes expanding traditional recycling services, increasing organics collection and processing, providing regulated waste and compliance services and secure information destruction and expanding our renewable energy projects to meet the evolving needs of our diverse customer base. As North America’s leading provider of comprehensive environmental solutions, we are taking big, bold steps to catalyze positive change – change that will impact our Company as well as the communities we serve. Consistent with our Company’s long-standing commitment to sustainability and environmental stewardship, we have published our 2025 Sustainability Report providing details on our sustainability-related performance and outlining progress towards our 2030 sustainability goals. The Sustainability Report conveys the strong linkage between the Company’s sustainability goals and our growth strategy, inclusive of the planned and ongoing expansion of the Company’s Recycling Processing and Sales and WM Renewable Energy segments. The information in this report can be found at sustainability.wm.com but it does not constitute a part of, and is not incorporated by reference into, this Quarterly Report on Form 10-Q.
We encounter intense competition from governmental, quasi-governmental and private service providers based on pricing, and to a much lesser extent, the nature of service offerings, particularly in the residential line of business. Our industry is directly affected by changes in general economic factors, including increases and decreases in consumer spending, business expansions and construction activity. These factors generally correlate to volumes of waste generated and impact our revenue. Negative economic conditions and other macroeconomic trends can and have caused customers to reduce their service needs. Such negative economic conditions, in addition to competitor actions, can impact our strategy to negotiate, renew, or expand service contracts and grow our business. We also encounter competition for acquisitions and growth opportunities. General economic factors and the market for consumer goods, in addition to regulatory developments, can also significantly impact commodity prices for the recyclable materials we sell. Significant components of our operating expenses vary directly as we experience changes in revenue due to volume and inflation. Volume changes can fluctuate significantly by line of business and volume changes in higher margin businesses can impact key financial metrics. We must dynamically manage our cost structure in response to volume changes and cost inflation.
We believe the Company’s industry-leading asset network and strategic focus on investing in our people and our digital platform will give the Company the necessary tools to address the evolving challenges impacting the Company and our industry. In line with our commitment to continuous improvement and a differentiated customer experience, we remain focused on our automation and optimization investments to enhance our operational efficiency and change the way we interact with our customers. Advancements made through these initiatives are intended to seamlessly and digitally connect all enterprise functions required to service customers and provide the best experience. We have made significant progress in executing this technology enablement strategy to automate and optimize certain elements of our service delivery model. The key benefits are reduced labor dependency for certain high-turnover positions, particularly in customer experience, recycling and residential collection, while further elevating our customer self-service through digitalization and implementation of technologies to enhance the safety, reliability and efficiency within our collection operations.
We sometimes experience margin pressures and variability in earnings and margins from our commodity-driven businesses, specifically within our Recycling Processing and Sales and WM Renewable Energy segments. During the first half of 2025, we experienced decreases in market prices for recycled commodities when compared to the prior year period, particularly in our recycling brokerage business. While the combined impacts of commodity price fluctuations from the prior year had a modestly favorable impact on the WM Renewable Energy segment in the first half of 2025, we may experience more significant impacts from fluctuations in the prices of renewable identification numbers (“RINs”) and natural gas as we continue to make investments to grow that segment in the future.
Variability in economic conditions, including inflation, interest rates, employment trends and supply chain reliability, can create risk and uncertainty in financial outlook. We take proactive steps to recover and mitigate inflationary cost
28
pressures through our overall pricing efforts and by managing our costs through efficiency, labor productivity and investments in technology to automate certain aspects of our business. We remain committed to putting our people first to ensure that they are well positioned to execute our daily operations diligently and safely. We remain focused on delivering outstanding customer service, managing our variable costs with changing volumes and investing in technology that will enhance our customers’ experience and provide operating efficiencies intended to reduce our cost to serve our customers.
Current Quarter Financial Results
During the second quarter of 2025, we continued to focus on our priorities to advance our strategy – enhancing employee engagement, permanently reducing our cost to serve our customers through the use of technology and automation, investing in growth through our Recycling Processing and Sales and WM Renewable Energy segments and integrating the Stericycle business. We continue to invest in our people through paying a competitive market wage, investing in our digital platform and providing training for our team members. We also continue to make investments in automation and optimization to enhance our operational efficiency and improve labor productivity for all lines of business. As part of the integration of Stericycle, which constitutes our new WM Healthcare Solutions segment, we achieved synergies by reducing costs of duplicative business processes, focused on service delivery for our customers and aligned team members and business processes with WM’s core values.
Key elements of our financial results for the second quarter include:
| ● | Revenues of $6,430 million, compared with $5,402 million in the prior year period, an increase of $1,028 million, or 19.0%. The increase is primarily attributable to (i) our recent acquisitions, particularly Stericycle; (ii) higher yield in our Collection and Disposal businesses and (iii) higher volumes primarily in our landfill, recycling and WM Renewable Energy businesses. These increases were partially offset by (i) lower residential and temporary industrial collection volumes and (ii) a reduction in single-stream and brokerage recycled commodity prices; |
| ● | Operating expenses of $3,839 million, or 59.7% of revenues, compared with $3,291 million, or 60.9% of revenues, in the prior year period. The $548 million increase in operating expenses is primarily attributable to (i) our recent acquisitions; (ii) increased post-collection volumes and (iii) moderate inflationary pressures. These increases were partially offset by (i) lower residential and temporary industrial business volumes and (ii) operating efficiency and cost control initiatives which positioned us to reduce our operating expenses as a percentage of revenue when compared with the prior year period; |
| ● | Selling, general and administrative expenses were $696 million, or 10.8% of revenues, compared with $501 million, or 9.3% of revenues, in the prior year period. The $195 million increase is primarily attributable to (i) higher labor costs from acquisitions and (ii) consulting costs incurred to support the integration of Stericycle; |
| ● | Income from operations was $1,151 million, or 17.9% of revenues, compared with $1,009 million, or 18.7% of revenues, in the prior year period. The $142 million increase in the current year earnings was primarily driven by (i) growth in our Collection and Disposal business; (ii) a $54 million charge recognized in the prior year to increase the estimated fair value of a liability associated with the expected disposition of an investment we hold in a waste diversion technology business and (iii) higher volumes in our WM Renewable Energy business due to the completion of projects that increase the beneficial use of landfill gas sold to third parties. This growth was partially offset by (i) higher depreciation and amortization costs and integration related expenses arising from our Stericycle acquisition and (ii) lower recycled commodity prices; |
| ● | Net income attributable to Waste Management, Inc. was $726 million, or $1.80 per diluted share, compared with $680 million, or $1.69 per diluted share, in the prior year period. The $46 million increase was primarily driven by an increase in income from operations, discussed above, and to a lesser extent a reduction in income tax expense. These increases were partially offset by increased interest expense related to the additional debt incurred to finance our Stericycle acquisition; |
| ● | Net cash provided by operating activities was $1,545 million compared with $1,154 million in the prior year period, with the increase driven by (i) higher earnings in the majority of our segments, including the contributions from our recent acquisitions and (ii) favorable changes in working capital, net of effects of acquisitions and |
29
| divestitures. This increase was partially offset by higher cash interest primarily due to additional debt incurred to fund our acquisition of Stericycle. |
| ● | Free cash flow was $818 million compared with $530 million in the prior year period. The increase in free cash flow is attributable to the increase in net cash provided by operating activities discussed above. These increases were partially offset by (i) increased capital spending, which was driven by investments in capital assets such as trucks, landfills and equipment and capital expenditures within our WM Healthcare Solutions segment to support the business and (ii) lower proceeds from divestitures of non-strategic assets and businesses. Free cash flow is a non-GAAP measure of liquidity. Refer to Free Cash Flow below for our definition of free cash flow, additional information about our use of this measure, and a reconciliation to net cash provided by operating activities, which is the most comparable GAAP measure. |
Results of Operations
Operating Revenues
The mix of operating revenues from our major lines of business for the three and six months ended June 30 are as follows (in millions):
| | | | | | | | | |
| | Net | | Intercompany | | Gross | |||
|
| Operating | | Operating | | Operating | |||
| | Revenues |
| Revenues (a)(b) |
| Revenues | |||
Three Months Ended June 30: | | | | | | | | | |
2025 |
| | | | | | | | |
Commercial |
| $ | 1,398 | | $ | 220 | | $ | 1,618 |
Industrial | |
| 790 | | | 223 | |
| 1,013 |
Residential | | | 872 | | | 22 | | | 894 |
Other collection | |
| 796 | |
| 68 | |
| 864 |
Total collection | |
| 3,856 | |
| 533 | |
| 4,389 |
Landfill | | | 1,036 | | | 410 | | | 1,446 |
Transfer | | | 389 | | | 292 | | | 681 |
Total Collection and Disposal | |
| 5,281 | |
| 1,235 | |
| 6,516 |
Recycling Processing and Sales | |
| 381 | |
| 101 | |
| 482 |
WM Renewable Energy | |
| 115 | |
| — | |
| 115 |
WM Healthcare Solutions | | | 646 | | | 1 | | | 647 |
Corporate and Other | | | 7 | | | 8 | | | 15 |
Total | | $ | 6,430 | | $ | 1,345 | | $ | 7,775 |
| | | | | | | | | |
2024 | | | | | | | | | |
Commercial |
| $ | 1,330 | | $ | 196 | | $ | 1,526 |
Industrial | |
| 779 | | | 199 | |
| 978 |
Residential | | | 863 | | | 23 | | | 886 |
Other collection | |
| 729 | |
| 52 | |
| 781 |
Total collection | |
| 3,701 | |
| 470 | |
| 4,171 |
Landfill | | | 873 | | | 389 | | | 1,262 |
Transfer | | | 348 | | | 270 | | | 618 |
Total Collection and Disposal | |
| 4,922 | |
| 1,129 | |
| 6,051 |
Recycling Processing and Sales | |
| 405 | |
| 70 | |
| 475 |
WM Renewable Energy | |
| 69 | |
| 1 | |
| 70 |
Corporate and Other | | | 6 | | | 8 | | | 14 |
Total | | $ | 5,402 | | $ | 1,208 | | $ | 6,610 |
30
| | | | | | | | | |
| | Net | | Intercompany | | Gross | |||
|
| Operating | | Operating | | Operating | |||
| | Revenues |
| Revenues (a)(b) |
| Revenues | |||
Six Months Ended June 30: | | | | | | | | | |
2025 |
| | | | | | | | |
Commercial |
| $ | 2,778 | | $ | 434 | | $ | 3,212 |
Industrial | |
| 1,531 | | | 422 | |
| 1,953 |
Residential | | | 1,744 | | | 44 | | | 1,788 |
Other collection | |
| 1,549 | |
| 140 | |
| 1,689 |
Total collection | |
| 7,602 | |
| 1,040 | |
| 8,642 |
Landfill | | | 1,876 | | | 763 | | | 2,639 |
Transfer | | | 725 | | | 548 | | | 1,273 |
Total Collection and Disposal | |
| 10,203 | |
| 2,351 | |
| 12,554 |
Recycling Processing and Sales | |
| 765 | |
| 182 | |
| 947 |
WM Renewable Energy | |
| 206 | |
| 1 | |
| 207 |
WM Healthcare Solutions | | | 1,265 | | | 9 | | | 1,274 |
Corporate and Other | | | 9 | | | 16 | | | 25 |
Total | | $ | 12,448 | | $ | 2,559 | | $ | 15,007 |
| | | | | | | | | |
2024 | | | | | | | | | |
Commercial |
| $ | 2,646 | | $ | 381 | | $ | 3,027 |
Industrial | |
| 1,526 | | | 386 | |
| 1,912 |
Residential | | | 1,717 | | | 45 | | | 1,762 |
Other collection | |
| 1,427 | |
| 105 | |
| 1,532 |
Total collection | |
| 7,316 | |
| 917 | |
| 8,233 |
Landfill | | | 1,665 | | | 749 | | | 2,414 |
Transfer | | | 657 | | | 521 | | | 1,178 |
Total Collection and Disposal | |
| 9,638 | |
| 2,187 | |
| 11,825 |
Recycling Processing and Sales | |
| 773 | |
| 138 | |
| 911 |
WM Renewable Energy | |
| 138 | |
| 2 | |
| 140 |
Corporate and Other | | | 12 | | | 13 | | | 25 |
Total | | $ | 10,561 | | $ | 2,340 | | $ | 12,901 |
| (a) | Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. |
| (b) | Beginning with the 2024 Form 10-K, the Company adjusted gross and intercompany operating revenues to reflect the 15% royalty paid by WM Renewable Energy to our Collection and Disposal and Corporate and Other businesses for the purchase of landfill gas. There was no change to net operating revenues. Prior periods have been recast to conform to current presentation. |
31
The following table provides details associated with the period-to-period change in revenues and average yield (dollars in millions):
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Period-to-Period Change for the |
| | | Period-to-Period Change for the |
| |||||||||||||||||
| | | | | As a % of | | | | | | As a % of |
| | | | | As a % of |
| | | | | As a % of |
|
| | | | | Related | | | | | | Total |
| | | | | Related |
| | | | | Total |
|
|
| Amount |
| Business(a) |
|
| Amount |
| Company(b) | |
| Amount |
| Business(a) |
|
| Amount |
| Company(b) | | ||||
Collection and Disposal | | $ | 191 | | 4.1 | % | | | | | | | | $ | 370 | | 4.0 | % | | | | | | |
Recycling Processing and Sales and WM Renewable Energy (c) | |
| (25) | | (5.3) | | |
| | | | | |
| (25) | | (2.7) | | |
| | | | |
Energy surcharge and mandated fees | |
| 9 | | 4.2 | | |
| | | | | |
| 7 | | 1.7 | | |
| | | | |
Total average yield (d) | |
| | | | | | $ | 175 | | 3.3 | % | |
| | | | | | $ | 352 | | 3.4 | % |
Volume (e) | |
| | | | | |
| 115 | | 2.1 | | |
| | | | | |
| 119 | | 1.1 | |
Internal revenue growth | | | | | | | | | 290 | | 5.4 | | | | | | | | | | 471 | | 4.5 | |
Acquisitions | | | | | | | | | 746 | | 13.7 | | | | | | | | | | 1,440 | | 13.6 | |
Divestitures | | | | | | | | | (6) | | (0.1) | | | | | | | | | | (10) | | (0.1) | |
Foreign currency translation | | | | | | | | | (2) | | — | | | | | | | | | | (14) | | (0.1) | |
Total | | | | | | | | $ | 1,028 | | 19.0 | % | | | | | | | | $ | 1,887 | | 17.9 | % |
| (a) | Calculated by dividing the increase or decrease for the current year period by the prior year period’s related business revenues adjusted to exclude the impacts of divestitures for the current year period. |
| (b) | Calculated by dividing the increase or decrease for the current year period by the prior year period’s total Company revenues adjusted to exclude the impacts of divestitures for the current year period. |
| (c) | Includes combined impact of commodity price variability in both our Recycling Processing and Sales and WM Renewable Energy segments, as well as changes in certain recycling fees charged by our collection and disposal operations. |
| (d) | The amounts reported herein represent the changes in our revenues attributable to average yield for the total Company. |
| (e) | Includes activities from our Corporate and Other businesses. |
The following provides further details about our period-to-period change in revenues:
Average Yield
Collection and Disposal Average Yield — This measure reflects the effect on our revenues from the pricing activities of our collection, transfer and landfill operations, exclusive of volume changes. Revenue growth from Collection and Disposal average yield includes not only base rate changes and environmental and service fee fluctuations, but also (i) certain average price changes related to the overall mix of services, which are due to the types of services provided; (ii) changes in average price from new and lost business and (iii) price decreases to retain customers.
32
The details of our revenue growth from Collection and Disposal average yield are as follows (dollars in millions):
| | | | | | | | | | | |
| | Period-to-Period Change for the | | Period-to-Period Change for the |
| ||||||
| | Three Months Ended | | Six Months Ended | | ||||||
| | June 30, 2025 vs. 2024 |
| June 30, 2025 vs. 2024 | | ||||||
| | | | | As a % of |
| | | | As a % of | |
| | | | | Related |
| | | | Related | |
|
| Amount |
| Business |
| Amount |
| Business |
| ||
Commercial | | $ | 74 | | 5.3 | % | $ | 153 | | 5.5 | % |
Industrial | |
| 35 | | 3.8 | |
| 62 | | 3.5 | |
Residential | |
| 47 | | 5.7 | |
| 90 | | 5.4 | |
Total collection | |
| 156 | | 4.7 | |
| 305 | | 4.7 | |
Landfill | |
| 22 | | 2.7 | |
| 34 | | 2.2 | |
Transfer | |
| 13 | | 4.0 | |
| 31 | | 4.8 | |
Total Collection and Disposal | | $ | 191 | | 4.1 | % | $ | 370 | | 4.0 | % |
Our overall pricing efforts are focused on keeping pace with the increasing costs and capital intensity of our business. We continue to see yield growth in our landfill business primarily driven by municipal solid waste landfills, which achieved average yield of 7.0% and 5.6% for the three and six months ended June 30, 2025, respectively, led by strong performance in our West Tier.
Recycling Processing and Sales and WM Renewable Energy — Recycling Processing and Sales revenues attributable to yield decreased $33 million and $41 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. Average market prices for single-stream recycled commodities declined nearly 15% and 5% for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. Revenues attributable to yield in our WM Renewable Energy segment increased $8 million and $16 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods, primarily driven by an increase in natural gas and electricity pricing. While there may be short-term fluctuations in our commodity-driven businesses as prices change, we continue to take proactive steps to adjust our business models to protect against the downside risk of changes in commodity prices.
Energy Surcharge and Mandated Fees — These fees increased $9 million and $7 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. The increase was primarily due to higher mandated fees of $18 million and $25 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. The mandated fees are primarily related to fees and taxes assessed by various state, county and municipal government agencies at our landfills and transfer stations, particularly in our West Tier. Partially offsetting the increase was a decline in our energy surcharge revenues of $9 million and $18 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods, primarily due to a decline in the market prices for diesel fuel of approximately 8% for the three and six months ended June 30, 2025.
Volume
Our revenues from volume (excluding volumes from acquisitions and divestitures) increased $115 million and $119 million for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. Special waste volume in our West Tier was favorably impacted by the wildfire clean-up activities that began in the first quarter of 2025. Additionally, volumes increased in both our WM Renewable Energy and Recycling Processing and Sales segments primarily due to contributions from growth projects. Furthermore, volumes increased in our Strategic Business Solutions business due to our focus on a differentiated service model for national account customers. These volume increases were partially offset by declines in industrial and residential collection volume primarily due to lower contributions from temporary industrial business and intentional shedding of lower-margin residential business.
33
Acquisitions and Divestitures
Acquisitions and divestitures resulted in a net increase in revenues of $740 million, or 13.6%, and $1,430 million, or 13.5%, respectively, for the three and six months ended June 30, 2025, as compared with the prior year periods. This increase was primarily due to our acquisition of Stericycle in November 2024. The remaining increase was related to our ongoing investment in tuck-in collection and disposal businesses.
Operating Expenses
The following table summarizes the major components of our operating expenses for the three and six months ended June 30 (in millions of dollars and as a percentage of revenues):
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Six Months Ended | | ||||||||||||||||||
| | June 30, | | | June 30, | | ||||||||||||||||||
|
| 2025 | |
| 2024 |
|
| 2025 | |
| 2024 | | ||||||||||||
Labor and related benefits | | $ | 1,129 |
| 17.6 | % | | $ | 925 |
| 17.1 | % | | $ | 2,203 |
| 17.7 | % | | $ | 1,818 |
| 17.2 | % |
Transfer and disposal costs | |
| 366 | | 5.7 | | |
| 327 | | 6.1 | | |
| 698 | | 5.6 | | |
| 642 | | 6.1 | |
Maintenance and repairs | |
| 580 | | 9.0 | | |
| 522 | | 9.7 | | |
| 1,129 | | 9.1 | | |
| 1,011 | | 9.6 | |
Subcontractor costs | |
| 631 | | 9.8 | | |
| 561 | | 10.4 | | |
| 1,231 | | 9.9 | | |
| 1,097 | | 10.4 | |
Cost of goods sold | |
| 246 | | 3.8 | | |
| 256 | | 4.7 | | |
| 482 | | 3.9 | | |
| 484 | | 4.6 | |
Fuel | |
| 129 | | 2.0 | | |
| 111 | | 2.0 | | |
| 260 | | 2.1 | | |
| 223 | | 2.1 | |
Disposal and franchise fees and taxes | |
| 215 | | 3.4 | | |
| 190 | | 3.5 | | |
| 396 | | 3.2 | | |
| 362 | | 3.4 | |
Landfill operating costs | |
| 142 | | 2.2 | | |
| 134 | | 2.5 | | |
| 266 | | 2.1 | | |
| 263 | | 2.5 | |
Risk management | |
| 90 | | 1.4 | | |
| 96 | | 1.8 | | |
| 206 | | 1.6 | | |
| 173 | | 1.6 | |
Other | |
| 311 | | 4.8 | | |
| 169 | | 3.1 | | |
| 615 | | 4.9 | | |
| 358 | | 3.4 | |
| | $ | 3,839 | | 59.7 | % | | $ | 3,291 | | 60.9 | % | | $ | 7,486 | | 60.1 | % | | $ | 6,431 | | 60.9 | % |
Our operating expenses for the three and six months ended June 30, 2025 increased as compared with the three and six months ended June 30, 2024, primarily due to (i) our recent acquisitions; (ii) increased post-collection volumes and (iii) moderate inflationary pressures. These increases were offset, in part, by (i) lower residential and temporary industrial business volumes and (ii) continued operating efficiency and cost control initiatives in our Collection and Disposal businesses. Despite the overall increase in operating expenses, efficiency gains, improved turnover and momentum in truck deliveries, combined with the benefit of price increases and high margin special waste volumes, positioned us to reduce our operating expenses as a percentage of revenue when compared with the prior year period.
Significant items affecting the comparison of operating expenses for the reported periods include:
Labor and Related Benefits — The increase in labor and related benefits costs was largely driven by (i) the addition of employees as a result of our recent acquisitions and (ii) annual employee wage increases. The increase was offset, in part, by (i) residential collection efficiency improvements; (ii) lower residential volumes attributable to intentional shedding of lower margin contracts and (iii) improved driver retention.
Transfer and Disposal Costs — The increase in transfer and disposal costs was primarily due to our recent acquisitions and inflationary cost pressures, which includes increased disposal fees at third-party sites and higher rates from our third-party haulers. This increase was partially offset by lower residential volumes attributable to intentional shedding of lower margin contracts.
Maintenance and Repairs — The increase in maintenance and repairs costs was largely driven by (i) additional costs incurred as a part of our recent acquisitions; (ii) inflation in parts, supplies and third-party services and (iii) annual employee wage increases. These increases were offset, in part, by new truck deliveries, which lowered average fleet age and reduced demand for parts, supplies and third-party services.
34
Subcontractor Costs — The increase in subcontractor costs was primarily due to (i) additional costs incurred as a part of our recent acquisitions and (ii) continued inflationary cost pressures, particularly labor costs from third-party haulers. These increases were offset, in part, by the impact of lower fuel prices on third-party subcontracted hauling and services as compared with the three and six months ended June 30, 2024.
Cost of Goods Sold — The decrease in cost of goods sold was primarily driven by a 15% and 5% decrease in average market prices for single-stream recycled commodities for the three and six months ended June 30, 2025, respectively, as compared with the prior year periods. This decrease was partially offset by additional pipeline transportation costs attributable to new RNG facilities brought on-line since the prior year periods.
Fuel — The increase in fuel costs was primarily due to (i) our recent acquisitions and (ii) the expiration of the federal alternative fuel tax credit on December 31, 2024. These increases were offset, in part, by a decline in the market prices for diesel fuel of approximately 8% as compared to the prior year periods.
Disposal and Franchise Fees and Taxes — The increase in disposal and franchise fees and taxes was primarily driven by increased landfill volumes in our West Tier.
Landfill Operating Costs — The increase in landfill operating costs for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, was primarily due to an increase in volumes and higher leachate treatment costs in our West Tier. Partially offsetting the increase for the six months ended June 30, 2025 were certain adjustments to increase our environmental remediation reserve during the first quarter of 2024.
Risk Management — Risk management costs decreased for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, primarily due to improved claims experience offset, in part, by (i) additional claims and premiums attributable to our recent acquisitions and (ii) prior year quarter insurance recoveries for property claims associated with a hurricane in 2023. The increase for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was due to (i) additional claims and premiums attributable to our recent acquisitions and (ii) increases in claims costs due to negative claim development on a limited population of severe cases during the first quarter of 2025.
Other — Other operating cost increases were primarily due to (i) additional expenses attributable to our recent acquisitions; (ii) gains on the sale of real estate in 2024 and, to a much lesser extent, (iii) increased utility costs largely attributable to new RNG plants brought on-line since the prior year periods and increased power prices.
Selling, General and Administrative Expenses
The following table summarizes the major components of our selling, general and administrative expenses for the three and six months ended June 30 (in millions of dollars and as a percentage of revenues):
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Six Months Ended | | ||||||||||||||||||
| | June 30, | | | June 30, | | ||||||||||||||||||
|
| 2025 | |
| 2024 | |
| 2025 | |
| 2024 | | ||||||||||||
Labor and related benefits | | $ | 412 |
| 6.4 | % | | $ | 316 |
| 5.9 | % | | $ | 839 |
| 6.7 | % | | $ | 637 |
| 6.0 | % |
Professional fees | |
| 106 | | 1.6 | | |
| 64 | | 1.2 | | |
| 198 | | 1.6 | | |
| 111 | | 1.1 | |
Provision for bad debts | |
| 24 | | 0.4 | | |
| 16 | | 0.3 | | |
| 43 | | 0.4 | | |
| 26 | | 0.2 | |
Other | |
| 154 | | 2.4 | | |
| 105 | | 1.9 | | |
| 303 | | 2.4 | | |
| 218 | | 2.1 | |
| | $ | 696 | | 10.8 | % | | $ | 501 | | 9.3 | % | | $ | 1,383 | | 11.1 | % | | $ | 992 | | 9.4 | % |
Selling, general and administrative expenses increased for the three and six months ended June 30, 2025 primarily due to higher labor costs from acquisitions as well as consulting costs incurred to support the integration of Stericycle.
Significant items affecting the comparison of our selling, general and administrative expenses for the reported periods include:
35
Labor and Related Benefits — The increase in labor and related benefits costs was primarily related to (i) our recent acquisitions, particularly Stericycle; (ii) higher long-term incentive compensation costs and (iii) annual employee wage increases.
Professional Fees — The increase in professional fees was primarily attributable to our acquisition of Stericycle, including integration, business optimization and system development costs.
Provision for Bad Debts — The increase in provision for bad debts was primarily attributable to our WM Healthcare Solutions segment.
Other — The increase in other expenses was primarily related to increased spend across multiple cost categories, including technology, risk management and travel, largely driven by the acquisition of Stericycle.
Depreciation, Depletion and Amortization Expenses
The following table summarizes the components of our depreciation, depletion and amortization expenses for the three and six months ended June 30 (in millions of dollars and as a percentage of revenues):
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Six Months Ended | | ||||||||||||||||||
| | June 30, | | | June 30, | | ||||||||||||||||||
|
| 2025 | |
| 2024 |
|
| 2025 | |
| 2024 |
| ||||||||||||
Depreciation of tangible property and equipment | | $ | 386 |
| 6.0 | % | | $ | 312 |
| 5.8 | % | | $ | 757 |
| 6.1 | % | | $ | 620 |
| 5.9 | % |
Depletion of landfill airspace | |
| 220 | | 3.4 | | |
| 201 | | 3.7 | | |
| 403 | | 3.3 | | |
| 377 | | 3.6 | |
Amortization of intangible assets | |
| 102 | | 1.6 | | |
| 30 | | 0.6 | | |
| 204 | | 1.6 | | |
| 60 | | 0.5 | |
| | $ | 708 | | 11.0 | % | | $ | 543 | | 10.1 | % | | $ | 1,364 | | 11.0 | % | | $ | 1,057 | | 10.0 | % |
The increase in depreciation of tangible property and equipment for the three and six months ended June 30, 2025, as compared to the prior year periods, was driven by (i) our recent acquisitions and (ii) investments in capital assets such as trucks, landfills and equipment. The increase in depletion of landfill airspace for the three and six months ended June 30, 2025, as compared to the prior year periods, was primarily driven by volume increases, particularly at sites within our West Tier. The increase in amortization of intangible assets for the three and sixth months ended June 30, 2025 was primarily driven by the amortization of customer relationships and other intangibles acquired as part of the Stericycle acquisition.
Restructuring
The increase in restructuring charges during the three and six months ended June 30, 2025 was primarily driven by employee costs related to our acquisition of Stericycle.
(Gain) Loss from Divestitures, Asset Impairments and Unusual Items, Net
(Gain) loss from divestitures, asset impairments and unusual items, net for the three and six months ended June 30, 2025, primarily relates to a $16 million goodwill impairment charge to a business engaged in oil recovery and sludge processing services. This charge is reflected in Other Ancillary within our Collection and Disposal businesses.
(Gain) loss from divestitures, asset impairments and unusual items, net for the three and six months ended June 30, 2024 primarily relates to a $54 million charge required to increase the estimated fair value of a liability associated with the expected disposition of an investment the Company holds in a waste diversion technology business. This charge is reflected in our Corporate and Other measures within our segment reporting.
36
Income from Operations
The following table summarizes income from operations for our reportable segments for the three and six months ended June 30 (dollars in millions):
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | | Six Months Ended | | |
| ||||||||||||||
| | June 30, | | Period-to-Period | | June 30, | | Period-to-Period |
| ||||||||||||||
| | 2025 |
| 2024 |
| Change | | 2025 |
| 2024 | | Change |
| ||||||||||
Collection and Disposal: | | | | | | | | | | | | | | | | | | | | | | | |
East Tier | | $ | 721 | | $ | 692 | | $ | 29 |
| 4.2 | % | $ | 1,390 | | $ | 1,346 | | $ | 44 |
| 3.3 | % |
West Tier | | | 757 | | | 674 | | | 83 | | 12.3 | | | 1,436 | | | 1,301 | | | 135 |
| 10.4 | |
Other Ancillary | |
| (17) | |
| (7) | |
| (10) |
| * | |
| (20) | |
| (9) | |
| (11) |
| * | |
Collection and Disposal | |
| 1,461 | |
| 1,359 | |
| 102 |
| 7.5 | |
| 2,806 | |
| 2,638 | |
| 168 |
| 6.4 | |
Recycling Processing and Sales | |
| 24 | |
| 29 | |
| (5) |
| (17.2) | |
| 42 | |
| 48 | |
| (6) |
| (12.5) | |
WM Renewable Energy | | | 38 | | | 18 | | | 20 | | 111.1 | | | 57 | | | 39 | | | 18 | | 46.2 | |
WM Healthcare Solutions | | | (23) | | | — | | | (23) | | * | | | (44) | | | — | | | (44) | | * | |
Corporate and Other | | | (349) | | | (397) | | | 48 | | (12.1) | | | (697) | | | (700) | | | 3 | | (0.4) | |
Total | | $ | 1,151 | | $ | 1,009 | | $ | 142 |
| 14.1 | % | $ | 2,164 | | $ | 2,025 | | $ | 139 |
| 6.9 | % |
Percentage of revenues |
| | 17.9 | % | | 18.7 | % | | | | | | | 17.4 | % | | 19.2 | % | | | | | |
*Percentage change does not provide a meaningful comparison.
The significant items affecting income from operations for our segments during the three and six months ended June 30, 2025, as compared with the prior year periods, are summarized below:
| ● | Collection and Disposal — Income from operations in our Collection and Disposal businesses increased primarily due to (i) revenue growth from price increases, which translate into increased yield or average unit price; (ii) special waste volume in our West Tier, which was favorably impacted by the wildfire clean-up activities and (iii) actions to improve the efficiency and operating costs incurred to serve our customers. These increases were partially offset by higher depreciation and depletion costs as discussed in Depreciation, Depletion and Amortization Expenses above. |
| ● | Recycling Processing and Sales — The decline in income from operations in Recycling Processing and Sales was primarily due to (i) a gain on sale of a non-strategic asset in 2024; (ii) declining commodity prices compared to the prior year periods and (iii) lease termination costs. These decreases were partially offset by increased volumes, which can be attributed to the improved throughput of our facilities and the addition of new market facilities, and improved operating costs from the automation of our recycling facilities. |
| ● | WM Renewable Energy — The increase in income from operations in WM Renewable Energy was primarily due to higher volumes resulting from the completion of projects that increase the beneficial use of landfill gas sold to third parties. |
| ● | WM Healthcare Solutions — The loss generated during the three months and six months ended June 30, 2025, respectively, was largely attributable to (i) depreciation and amortization expenses and (ii) integration related expenses. There was no activity for this segment during the first half of 2024, as Stericycle was acquired in November 2024. |
| ● | Corporate and Other — The increase in income from operations was primarily driven by (i) a $54 million charge in the prior year to increase the estimated fair value of a liability associated with the expected disposition of an investment we hold in a waste diversion technology business and (ii) an improvement in risk management expenses. These increases were partially offset by (i) integration-related consulting fees in connection with our Stericycle acquisition; (ii) higher labor costs resulting from long-term incentive compensation costs and annual employee wage increases and (iii) professional services supporting business optimization. |
37
Interest Expense, Net
Our interest expense, net was $232 million and $464 million for the three and six months ended June 30, 2025, respectively, compared to $136 million and $266 million for the three and six months ended June 30, 2024, respectively. The increase is primarily related to an increase in our average debt balances to fund our November 2024 acquisition of Stericycle.
Income Tax Expense
Our income tax expense and effective income tax rate was $201 million, or 21.7%, and $352 million, or 20.5%, for the three and six months ended June 30, 2025, respectively, compared to $214 million, or 23.9%, and $376 million, or 21.3%, for the three and six months ended June 30, 2024, respectively. See Note 4 to the Condensed Consolidated Financial Statements for more information related to income taxes.
Tax Legislation — On July 4, 2025, President Trump signed the One Big Beautiful Bill Act into law. We are currently evaluating several business tax provisions in the legislation, none of which are expected to have a material impact on our effective tax rate. However, the permanent reinstatement of 100% bonus depreciation is expected to reduce our cash taxes by approximately $125 million in 2025.
The Inflation Reduction Act of 2022 (“IRA”) contains several tax-related provisions, including with respect to (i) alternative fuel tax credits; (ii) tax incentives for investments in renewable energy production, carbon capture and other climate actions and (iii) the overall measurement of corporate income taxes. Given the complexity and uncertainty around the applicability of the legislation to our specific facts and circumstances, we continue to analyze the IRA provisions to identify and quantify potential opportunities and applicable benefits included in the legislation. The provisions of the IRA concerning investment tax credits are expected to generate a cumulative benefit of approximately $400 million, $145 million of which was recognized in 2023 and 2024 with the remainder anticipated to be realized in 2025 and 2026. The expected benefit from the investment tax credit for 2025 and 2026 is dependent on a number of estimates and assumptions, including the timing of project completion. Additionally, we expect that the production tax credit incentives for investments in renewable energy and carbon capture, as expanded by the IRA, could result in an incremental benefit to the Company, although at this time, the anticipated amount of such benefit has not been quantified due, in part, to the lack of regulatory guidance.
Liquidity and Capital Resources
The Company consistently generates cash flow from operations that meets and exceeds our working capital needs, allows for payment of our dividends, investment in the business through capital expenditures and tuck-in acquisitions and funding of strategic sustainability growth investments. We continually monitor our actual and forecasted cash flows, our liquidity and our capital resources, enabling us to plan for our present needs and fund unbudgeted business requirements that may arise during the year. The Company believes that its investment grade credit ratings, diverse investor base, large value of unencumbered assets and modest leverage enable it to obtain adequate financing, and refinance upcoming maturities, as necessary to meet its ongoing capital, operating, strategic and other liquidity requirements. We also have the ability to manage liquidity during periods of significant financial market disruption through temporary modification of our capital expenditure and share repurchase plans.
38
Summary of Cash and Cash Equivalents, Restricted Funds and Debt Obligations
The following is a summary of our cash and cash equivalents, restricted funds and debt balances (in millions):
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
Cash and cash equivalents | | $ | 440 | | $ | 414 |
Restricted funds and other: | |
|
| |
| |
Insurance reserves | | $ | 518 | | $ | 385 |
Final capping, closure, post-closure and environmental remediation funds | | | 135 | | | 128 |
Other | |
| 4 | |
| — |
Total restricted funds and other (a) | | $ | 657 | | $ | 513 |
Debt: | |
|
| |
|
|
Current portion | | $ | 964 | | $ | 1,359 |
Long-term portion | |
| 23,056 | |
| 22,541 |
Total debt | | $ | 24,020 | | $ | 23,900 |
| (a) | As of June 30, 2025 and December 31, 2024, $104 million and $100 million, respectively, of these account balances were included in other current assets in our Condensed Consolidated Balance Sheets. |
Debt — As of June 30, 2025, we had approximately $4.0 billion of debt maturing within the next 12 months, including (i) $1.5 billion of short-term borrowings under our commercial paper program (net of related discount on issuance); (ii) $1.5 billion of tax-exempt bonds with term interest rate periods that expire within the next 12 months, which is prior to their scheduled maturities; (iii) $500 million of 0.75% senior notes that mature in November 2025 and (iv) $464 million of other debt with scheduled maturities within the next 12 months, including $298 million of tax-exempt bonds. As of June 30, 2025, we have classified $3.0 billion of debt maturing in the next 12 months as long term because we have the intent and ability to refinance these borrowings on a long-term basis as supported by the forecasted available capacity under our $3.5 billion long-term U.S. and Canadian revolving credit facility. The remaining $964 million of debt maturing in the next 12 months is classified as current obligations.
Guarantor Financial Information
WM Holdings has fully and unconditionally guaranteed all of WMI’s senior indebtedness. WMI has fully and unconditionally guaranteed all of WM Holdings’ senior indebtedness. None of WMI’s other subsidiaries have guaranteed any of WMI’s or WM Holdings’ debt. In lieu of providing separate financial statements for the subsidiary issuer and guarantor (WMI and WM Holdings), we have presented the accompanying supplemental summarized combined balance sheet and income statement information for WMI and WM Holdings on a combined basis after elimination of intercompany transactions between WMI and WM Holdings and amounts related to investments in any subsidiary that is a non-guarantor (in millions):
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
Balance Sheet Information: | | | | | | |
Current assets |
| $ | 244 | | $ | 15 |
Noncurrent assets | | | 14 | | | 14 |
Current liabilities | |
| 990 | |
| 1,367 |
Noncurrent liabilities: | | | | | | |
Advances due to affiliates | | | 16,367 | | | 15,328 |
Other noncurrent liabilities | |
| 20,580 | |
| 20,140 |
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| | | |
|
| Six Months Ended | |
| | June 30, 2025 | |
Income Statement Information: | | | |
Revenue |
| $ | — |
Operating income | | | (462) |
Net loss | | | (342) |
Summary of Cash Flow Activity
The following is a summary of our cash flows for the six months ended June 30 (in millions):
| | | | | | |
| | 2025 |
| 2024 | ||
Net cash provided by operating activities | | $ | 2,753 | | $ | 2,521 |
Net cash used in investing activities | | $ | (1,915) | | $ | (2,359) |
Net cash used in financing activities | | $ | (781) | | $ | (464) |
Net Cash Provided by Operating Activities — Our operating cash flows increased by $232 million for the six months ended June 30, 2025, as compared with the prior year period, driven by higher earnings in the majority of our segments, including the contributions from our recent acquisitions. These increases were partially offset by (i) higher cash interest primarily due to additional debt incurred to fund our acquisition of Stericycle; (ii) unfavorable changes in working capital, net of effects of acquisitions and divestitures, primarily driven by timing of cash collections and (iii) higher annual incentive compensation payments.
Net Cash Used in Investing Activities — The most significant items included in our investing cash flows for the six months ended June 30, 2025 and 2024 are summarized below:
| ● | Capital Expenditures — We used $1,563 million and $1,335 million for capital expenditures during the six months ended June 30, 2025 and 2024, respectively. The increase in capital spending is primarily driven by (i) investments in capital assets such as trucks, landfills and equipment and (ii) capital expenditures within our WM Healthcare Solutions segment to support the business. |
| ● | Acquisitions — Our spending on acquisitions was $374 million and $250 million during the six months ended June 30, 2025 and 2024, respectively, of which $366 million and $243 million, respectively, are considered cash used in investing activities. The remaining spend is cash used in financing activities related to the timing of contingent consideration paid. Substantially all of these acquisitions are related to our solid waste and recycling businesses. |
| ● | Divestitures — Proceeds from divestitures of businesses and other assets, net of cash divested were $103 million and $58 million for the six months ended June 30, 2025 and 2024, respectively. Proceeds in 2025 primarily related to the sale of our WM Healthcare Solutions’ Spain and Portugal subsidiaries. The remaining 2025 and 2024 proceeds were from the sale of certain non-strategic assets. |
| ● | Other, Net — The year-over-year changes in other investing activities were primarily driven by our 2024 repurchase of $778 million in certain WM tax-exempt bonds. The remaining year-over-year changes in other investing activities are primarily driven by changes in our investment portfolio associated with a wholly-owned insurance captive. During the six months ended June 30, 2025 and 2024, we used $87 million and $61 million, respectively, of cash from restricted cash and cash equivalents to invest in available-for-sale securities. |
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Net Cash Used in Financing Activities — The most significant items affecting the comparison of our financing cash flows for the six months ended June 30, 2025 and 2024 are summarized below:
| ● | Debt Borrowings and Repayments — The following summarizes our cash borrowings and repayments of debt for the six months ended June 30 (in millions): |
| | | | | | |
|
| 2025 | | 2024 | ||
Borrowings: |
|
|
| | |
|
Commercial paper |
| $ | 9,005 | | $ | 9,180 |
Tax-exempt bonds |
|
| 130 | |
| — |
|
| $ | 9,135 | | $ | 9,180 |
Repayments: |
|
|
| |
|
|
Commercial paper |
| $ | (8,744) | | $ | (8,496) |
Senior notes |
| | (422) | | | (156) |
Tax-exempt bonds |
|
| — | |
| (30) |
Other debt |
|
| (68) | |
| (70) |
|
| $ | (9,234) | | $ | (8,752) |
Net cash borrowings (repayments) | | $ | (99) | | $ | 428 |
Refer to Note 3 to the Condensed Consolidated Financial Statements for additional information related to our debt borrowings and repayments.
| ● | Common Stock Repurchase Program — During the six months ended June 30, 2024, we used $262 million to repurchase shares of our common stock under accelerated share repurchase agreements. In the fourth quarter of 2024, we announced our temporary suspension of share repurchase activity as a result of the acquisition of Stericycle. We expect to resume share repurchases once the Company’s leverage returns to targeted levels, which is currently projected to be the second quarter of 2026. |
| ● | Cash Dividends — For the periods presented, all dividends have been declared by our Board of Directors. We paid cash dividends of $669 million and $608 million during the six months ended June 30, 2025 and 2024, respectively. The increase in dividend payments is primarily due to our quarterly per share dividend increasing from $0.75 in 2024 to $0.825 in 2025. |
Free Cash Flow
We are presenting free cash flow, which is a non-GAAP measure of liquidity, in our disclosures because we use this measure in the evaluation and management of our business. We define free cash flow as net cash provided by operating activities, less capital expenditures, plus proceeds from divestitures of businesses and other assets, net of cash divested. We believe it is indicative of our ability to pay our quarterly dividends, repurchase common stock, fund acquisitions and other investments and, in the absence of refinancings, to repay our debt obligations. Free cash flow is not intended to replace net cash provided by operating activities, which is the most comparable GAAP measure. We believe free cash flow gives investors useful insight into how we view our liquidity, but the use of free cash flow as a liquidity measure has material limitations because it excludes certain expenditures that are required or that we have committed to, such as declared dividend payments and debt service requirements.
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Our calculation of free cash flow and reconciliation to net cash provided by operating activities for the three and six months ended June 30, 2025 and 2024 is shown in the table below (in millions) and may not be calculated the same as similarly-titled measures presented by other companies:
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, | | June 30, | ||||||||
| | 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
Net cash provided by operating activities | | $ | 1,545 | | $ | 1,154 | | $ | 2,753 | | $ | 2,521 |
Capital expenditures to support the business | | | (572) | | | (445) | | | (1,275) | | | (947) |
Capital expenditures - sustainability growth investments (a) | | | (160) | | | (222) | | | (288) | | | (388) |
Total capital expenditures | |
| (732) | |
| (667) | |
| (1,563) | |
| (1,335) |
Proceeds from divestitures of businesses and other assets, net of cash divested | |
| 5 | |
| 43 | |
| 103 | |
| 58 |
Free cash flow | | $ | 818 | | $ | 530 | | $ | 1,293 | | $ | 1,244 |
| (a) | These growth investments are intended to further our sustainability leadership position by increasing recycling volumes and growing renewable natural gas generation. We expect they will deliver circular solutions for our customers and drive environmental value to the communities we serve. |
Critical Accounting Estimates and Assumptions
In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with precision from available data or simply cannot be calculated. In some cases, these estimates are difficult to determine and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, long-lived asset impairments, intangible asset impairments and the fair value of assets and liabilities acquired in business combinations, as described in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements.
Seasonal Trends
Our financial and operating results may fluctuate for many reasons, including period-to-period changes in the relative contribution of revenue by each line of business, changes in commodity prices and general economic conditions. Our operating revenues and volumes typically experience seasonal increases in the summer months that are reflected in second and third quarter revenues and results of operations.
Service or operational disruptions caused by severe storms, extended periods of inclement weather or climate events can significantly affect the operating results of the geographic areas affected. Extreme weather events may also lead to supply chain disruption and delayed project development, or disruption of our customers’ businesses, reducing the amount of waste generated by their operations.
Conversely, certain destructive weather and climate conditions, such as wildfires in the Western U.S. and hurricanes that most often impact our operations in the Southern and Eastern U.S. during the second half of the year, can increase our revenues in the geographic areas affected as a result of the waste volumes generated by these events. While weather-related and other event-driven special projects can boost revenues through additional work for a limited time, due to significant start-up costs and other factors, such revenue can generate earnings at comparatively lower margins.
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Inflation
Variability in economic conditions, including inflation, interest rates, employment trends, and supply chain reliability, can create risk and uncertainty in financial outlook. We take proactive steps to recover and mitigate inflationary cost pressures through our overall pricing efforts and by managing our costs through efficiency, labor productivity and investments in technology to automate certain aspects of our business. These efforts may not be successful for various reasons including the pace of inflation, operating cost inefficiencies, market responses and contractual limitations, such as the timing lag in our ability to recover increased costs under certain contracts that are tied to a price escalation index with a lookback provision.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Information about market risks as of June 30, 2025 does not materially differ from that discussed under Item 7A in our Annual Report on Form 10-K for the year ended December 31, 2024.
Item 4. Controls and Procedures.
Effectiveness of Disclosure Controls and Procedures
Our management, with the participation of our principal executive and financial officers, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) in ensuring that the information required to be disclosed in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including ensuring that such information is accumulated and communicated to management (including the principal executive and financial officers) as appropriate to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive and financial officers have concluded that such disclosure controls and procedures were effective as of June 30, 2025 (the end of the period covered by this Quarterly Report on Form 10-Q) at a reasonable assurance level.
Changes in Internal Control over Financial Reporting
Management, together with our CEO and CFO, evaluated the changes in our internal control over financial reporting during the quarter ended June 30, 2025. We determined that there were no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II.
Item 1. Legal Proceedings.
Information regarding our legal proceedings can be found under the Environmental Matters and Litigation sections of Note 6 to the Condensed Consolidated Financial Statements.
Item 1A. Risk Factors.
There have been no material changes to the risk factors previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Information concerning mine safety and other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this quarterly report.
Item 5. Other Information.
Securities Trading Plans of Directors and Executive Officers
On
44
Item 6. Exhibits.
| | |
Exhibit No. |
| Description |
4.1 | | Indenture for Senior Debt Securities dated September 10, 1997, among the Registrant and The Bank of New York Mellon Trust Company, N.A. (the current successor to Texas Commerce Bank National Association), as trustee [incorporated by reference to Exhibit 4.1 to Form 8-K dated September 10, 1997]. |
| | |
4.2* | | Form of 3.875% Senior Note due 2029. |
| | |
10.1* | | First Amendment to First Amended and Restated Employment Agreement by and between USA Waste-Management Resources, LLC and John J. Morris, Jr. |
| | |
22.1* | | Guarantor Subsidiary. |
| | |
31.1* | | Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934 James C. Fish, Jr., Chief Executive Officer. |
| | |
31.2* | | Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934 Devina A. Rankin, Executive Vice President and Chief Financial Officer. |
| | |
32.1** | | Certification Pursuant to 18 U.S.C. §1350 of James C. Fish, Jr., Chief Executive Officer. |
| | |
32.2** | | Certification Pursuant to 18 U.S.C. §1350 of Devina A. Rankin, Executive Vice President and Chief Financial Officer. |
| | |
95* | | Mine Safety Disclosures. |
| | |
101.INS* | | Inline XBRL Instance. |
| | |
101.SCH* | | Inline XBRL Taxonomy Extension Schema. |
| | |
101.CAL* | | Inline XBRL Taxonomy Extension Calculation. |
| | |
101.LAB* | | Inline XBRL Taxonomy Extension Labels. |
| | |
101.PRE* | | Inline XBRL Taxonomy Extension Presentation. |
| | |
101.DEF* | | Inline XBRL Taxonomy Extension Definition. |
| | |
104* | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* Filed herewith.
** Furnished herewith.
45
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | |
| WASTE MANAGEMENT, INC. | |
| | |
| By: | /s/ DEVINA A. RANKIN |
| | Devina A. Rankin |
| | Executive Vice President and |
| | Chief Financial Officer |
| | (Principal Financial Officer) |
| | |
| WASTE MANAGEMENT, INC. | |
| | |
| By: | /s/ JOHN CARROLL |
| | John Carroll |
| | Vice President and |
| | Chief Accounting Officer |
| | (Principal Accounting Officer) |
| | |
| | |
| | |
Date: July 29, 2025 | | |
| | |
46
FAQ
How much revenue did Waste Management (WM) report for Q2 2025?
What was WM's diluted EPS for Q2 2025 and its year-over-year change?
How did the Stericycle acquisition impact WM's results?
What is WM's current debt level and available liquidity?
How much cash did WM generate from operations in the first half of 2025?
What federal tax credits did WM recognize in Q2 2025?
