Xylem (XYL) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue reached $2.3 billion, up 6–6.1% year-over-year, driven by strong organic growth across all segments, especially Measurement and Control Solutions.

• Adjusted EBITDA margin hit a record 21.8%, up 100 bps year-over-year, with adjusted EPS rising 16% to $1.26.

• Net income attributable to shareholders was $226 million, with a net income margin of 9.8%, up 90 bps year-over-year.

• Orders increased 4.1% to $2,174 million, with a $5.0B backlog, though backlog declined as revenue outpaced order intake.

• Full-year 2025 revenue and adjusted EPS guidance were raised, reflecting confidence in continued above-market growth.

Financial highlights

• Q2 2025 revenue: $2.3 billion, up from $2.169 billion in Q2 2024; organic revenue up 6%.

• Adjusted EBITDA for Q2 2025 was $502 million (21.8% margin), up 11.1% year-over-year.

• Q2 2025 adjusted net income: $307 million; adjusted EPS: $1.26, up 16% year-over-year.

• Free cash flow for the first half of 2025 was $169 million, down from $230 million in the prior year, impacted by outsourced projects and tax timing.

• Net debt to adjusted EBITDA at 0.4x, with liquidity at $2.2 billion.

Outlook and guidance

• Full-year 2025 revenue guidance raised to $8.9–$9.0 billion (4–5% total growth, ~4% organic).

• Adjusted EBITDA margin expected at 21.3–21.8%, up 70–120 bps from 2024.

• Adjusted EPS guidance increased to $4.70–$4.85.

• Q3 2025 revenue expected at ~$2.2 billion, with 4–6% growth; adjusted EPS $1.20–$1.25.

• Guidance reflects ongoing macroeconomic, geopolitical, and regulatory uncertainties.