Waste Management, Inc.

What they do

Waste Management provides integrated waste management services, including collection, transfer, disposal, recycling, and resource recovery across the U.S. and Canada. It operates 257 landfills and 342 transfer stations, and is a leading recycler of paper, cardboard, glass, plastic, and metal. The company also develops and operates landfill gas-to-energy facilities producing renewable electricity and renewable natural gas, and, following the 2024 Stericycle acquisition, provides regulated waste and compliance services and secure information destruction in the U.S., Canada, and Western Europe.

Revenue drivers

• Collection and Disposal East Tier & West Tier — The core business provides collection, transfer, and disposal services across geographic tiers, contributing the majority of revenue. In Q2 2026, Collection and Disposal operating EBITDA grew by $104 million, driven by price-to-cost spread.
• Recycling Processing and Sales — Recycles materials like paper, cardboard, glass, plastic, and metal. In Q2 2026, operating EBITDA in recycling and renewable energy together grew $39 million (32.5% year-over-year) on higher volumes and automation efficiencies.
• Renewable Energy — Owns and operates landfill gas-to-energy facilities producing renewable electricity and RNG. Increased RNG production contributed to segment growth in Q2 2026.
• Healthcare Solutions (Stericycle) — Provides regulated waste and compliance services and secure information destruction. Added in November 2024 for $7.2 billion enterprise value; Q2 2026 saw synergy capture improving SG&A by 60 basis points.

Recent performance

For Q2 2026 (quarter ended June 30, 2026), revenue was $6.68 billion, up 4.0% year-over-year, with income from operations of $1.25 billion (as reported) and diluted EPS of $1.95. Adjusted operating EBITDA was $2.07 billion, up 5.5% (or 9.1% excluding prior-year wildfire cleanup). Cash flow from operations increased nearly 12%, and the company returned over $1 billion to shareholders during the quarter. Full-year 2025 revenue was $25.20 billion with net income of $2.71 billion and diluted EPS of $6.70.

Strategy

Management focuses on 'focused differentiation and continuous improvement,' leveraging technology, automation, and the asset network to drive price leadership and operational efficiency. Key investments include recycling and renewable energy growth projects, integration of Stericycle for synergies, and sustainability initiatives. The company emphasizes disciplined cost management and yield management over volume growth, intentionally shedding lower-margin residential business. In Q2 2026, they completed four sustainability growth projects and released the 2026 Sustainability Report.

Risks

• Integration and synergies risk — Failure to successfully integrate Stericycle and achieve anticipated synergies could impact financial performance.
• Volume decline and competition — Intentional shedding of lower-margin residential business and competitive pricing pressure could reduce volumes and margins.
• Regulatory and environmental compliance — New or changing regulations on emissions, recyclables, extended producer responsibility, and natural gas fleet could increase costs and liabilities.
• Macroeconomic and inflationary pressures — Labor, supply chain, fuel, and commodity price fluctuations, along with international trade restrictions, could squeeze margins.

Outlook

Management expresses confidence in achieving strong 2026 results, citing momentum across operations and the ability to execute strategy. They highlight continued benefits from technology, automation, sustainability projects, and healthcare business, with a nearly 12% increase in cash flow from operations. The CEO notes a 'significant technology runway ahead' to deliver long-term shareholder value.