01—Abstract
Summary
Summary of the 10-Q filed April 29, 2026. Cited figures are marked; the original filing is the authoritative source.
Waste Management, Inc. (WM) reported solid financial results for the first quarter ended March 31, 2026.
Revenue increased by 3.5% year-over-year to $6.227 billiona, driven by higher yield in Collection and Disposal, incremental volumes from the Renewable Energy segment, and recent acquisitions. This top-line growth translated into a significant increase in operating income, up 9.9% to $1.113 billion, and net income attributable to Waste Management, Inc. rose by 13.5% to $723 million, or $1.79 per diluted share. The company also demonstrated strong cash flow generation, with net cash provided by operating activities increasing by 24.3% to $1.501 billion, and free cash flow more than doubling to $920 million.
02—Key points
Key Highlights
- Revenue increased 3.5% to $6.227 billion, driven by pricing power in core services and contributions from renewable energy initiatives.
- Net income attributable to Waste Management, Inc. grew 13.5% to $723 million ($1.79 per diluted share), indicating improved profitability.
- Operating income rose 9.9% to $1.113 billion, reflecting effective cost management and revenue growth.
- Net cash provided by operating activities increased significantly by 24.3% to $1.501 billion, showcasing strong operational cash generation.
- Free cash flow more than doubled to $920 million, underscoring the company's robust ability to generate cash after capital expenditures.
- The company continued its capital allocation strategy by repurchasing $344 million of common stock and increasing dividends.
- The effective income tax rate decreased slightly to 18.9%, aided by federal tax credits related to renewable energy projects.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Waste Management Inc kept $0.12.
- Revenue$6.23B100.0%
- Cost of revenue−$3.69B59.3%
- Gross profit$2.53B40.7%
- Operating costs−$1.42B22.8%
- Operating income$1.11B17.9%
- Interest, other & tax−$390.0M6.3%
- Net income$723.0M11.6%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 29, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $6.23B$6.02B | +3.5% |
| Cost of Revenue | $3.69B$3.61B | +2.3% |
| Gross Profit | $2.53B$2.41B | +5.3% |
| SG&A Expenses | $707.00M$687.00M | +2.9% |
| Operating Expenses | $5.11B$5.00B | +2.2% |
| Operating Income | $1.11B$1.01B | +9.9% |
| Net Income | $723.00M$637.00M | +13.5% |
| EPS (Basic) | $1.79$1.58 | +13.3% |
| EPS (Diluted) | $1.79$1.58 | +13.3% |
| Shares Outstanding (Basic) | 403.20M402.30M | +0.2% |
| Shares Outstanding (Diluted) | 404.40M403.90M | +0.1% |
05—Questions
Frequently Asked Questions
What drove the revenue increase in the first quarter of 2026?
Revenue increased by 3.5% to $6.227 billion primarily due to higher yield in the Collection and Disposal business, incremental volumes from the Renewable Energy segment, and contributions from recent acquisitions. These factors were partially offset by lower collection volumes and reduced prices for recycled commodities.
How did the company's profitability change compared to the prior year?
Profitability improved significantly. Net income attributable to Waste Management, Inc. increased by 13.5% to $723 million, resulting in diluted earnings per share of $1.79, up from $1.58 in the prior year. This improvement was driven by strong revenue growth and effective cost management, leading to a higher operating income of $1.113 billion.
What is the company's cash flow situation, and how is it being utilized?
Waste Management demonstrated robust cash flow generation. Net cash provided by operating activities increased by 24.3% to $1.501 billion. Free cash flow more than doubled to $920 million. The company utilized this strong cash flow to repurchase $344 million of common stock and pay $385 million in cash dividends, indicating a commitment to returning capital to shareholders.
Are there any notable impacts from renewable energy initiatives?
Yes, the Renewable Energy segment contributed positively, with incremental volumes driving revenue growth. The company also benefited from federal tax credits, such as Section 45Z clean fuel production tax credits, which reduced income tax expense and are expected to continue through 2029. These initiatives are a key part of the company's sustainability strategy and growth.
06—Continue