Waste Management (WM) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 results with 7.9% organic revenue growth to $5.61 billion, driven by core price increases, higher recyclable commodity prices, and strong Collection and Disposal performance.

• Adjusted operating EBITDA grew 11% year-over-year to $1.71 billion, with margin reaching a record 30.5%, up 90 basis points.

• Net income attributable to shareholders was $760 million for Q3 2024, up from $663 million in Q3 2023.

• Continued investments in automation, technology, and sustainability, with $781 million in Q3 capital expenditures and $301 million returned to shareholders via dividends.

• Progressing toward closing the $7.2 billion Stericycle acquisition in Q4 2024, with related financing in place.

Financial highlights

• Q3 2024 operating revenues were $5.61 billion, up from $5.20 billion in Q3 2023; net income for Q3 2024 was $760 million.

• Diluted EPS for Q3 2024 was $1.88 (GAAP) and $1.96 (adjusted); nine months YTD EPS was $5.33.

• Free cash flow for the first nine months rose 20% year-over-year to $1.86 billion, with full-year guidance at the high end of $2.15 billion.

• Operating expenses as a percentage of revenue improved by 70 basis points to 60.6%.

• Cash from operations for the first nine months was $3.88 billion, up 16.2% year-over-year.

Outlook and guidance

• On track to deliver about $6.5 billion in operating EBITDA for 2024, near the upper end of guidance.

• Full-year 2024 revenue growth expected to be about 6%, above prior guidance.

• Free cash flow for 2024 expected to reach the high end of guidance at $2.15 billion.

• Anticipate continued growth in 2025, with significant contributions from sustainability projects and Stericycle integration.

• Margin expansion in collection and disposal business targeted at 50-100 basis points, with a 30 basis point headwind in 2025 from expiring alternative fuel tax credit.