Xylem Reports Fourth Quarter and Full Year 2025 Results
WASHINGTON--( BUSINESS WIRE)--Xylem Inc. (NYSE: XYL), a leading global water solutions company dedicated to solving the world’s most challenging water issues, today reported fourth-quarter and full-year 2025 results. The Company’s fourth-quarter revenue of $2.4 billion was driven by strong execution. Fourth-quarter adjusted earnings per share were up 20% driven by productivity and price.
“The team delivered an exceptionally strong fourth quarter, capping a year of solid execution and transformation across Xylem,” said Matthew Pine, Xylem’s CEO. “We achieved record full-year revenue, adjusted EBITDA margin, and adjusted EPS, supported by broad-based demand across our largest end markets. Healthy organic revenue and orders growth gave us solid momentum coming into 2026.”
“Xylem’s transformation continues to strengthen the quality of our earnings and position us for sustainable, profitable growth. In 2026, we expect resilient underlying demand as we sharpen our focus on simplifying the product portfolio to deliver essential technologies that help customers address their biggest water challenges. We remain confident in both our 2026 outlook and our ability to execute against our long-term framework.”
Net income attributable to Xylem for the quarter was $335 million, or $1.37 per share. Net income margin decreased 50 basis points to 14.0 percent. These results are driven by strong operational performance and a reduction in the estimated loss on sale of businesses, partially offset by increased restructuring and realignment costs. Adjusted net income attributable to Xylem was $348 million, or $1.42 per share, which excludes the loss on sale of businesses, purchase accounting intangible amortization, restructuring and realignment costs, and special charges.
Fourth-quarter adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) margin was 23.2 percent, reflecting a year-over-year increase of 220 basis points. Productivity savings and strong price realization drove the margin expansion, exceeding the impact of inflation, lower volumes, and tariffs.
The Board of Directors of Xylem has declared a first-quarter dividend of $0.43 per share, an increase of 8 percent. The dividend is payable on March 24, 2026, to shareholders of record as of February 24, 2026.
Outlook
Xylem forecasts full-year 2026 revenue of approximately $9.1 to $9.2 billion, up approximately 1 to 3 percent on a reported basis and up approximately 2 to 4 percent on an organic basis.
Full-year 2026 adjusted EBITDA margin is expected to be approximately 22.9 to 23.3 percent, an increase of 70 to 110 basis points from Xylem’s 2025 adjusted results. Full-year free cash flow margin is expected to be approximately 10.2 to 11 percent.
Further 2026 planning assumptions are included in Xylem’s fourth-quarter 2025 earnings materials posted at www.xylem.com/investors. Excluding revenue, Xylem provides guidance only on a non-GAAP basis due to the inherent difficulty in forecasting certain amounts that would be included in GAAP earnings, such as discrete tax items, without unreasonable effort.
Supplemental information on Xylem’s fourth-quarter earnings, as well as definitions of and reconciliations for certain non-GAAP items is posted at www.xylem.com/investors.
About Xylem
Xylem (XYL) is a Fortune 500 global water solutions company that empowers customers and communities to build a more water-secure world. Our 22,000 employees delivered revenue of $9 billion in 2025, optimizing water and resource management with innovation and expertise. Join us at www.xylem.com and Let’s Solve Water.
Forward-Looking Statements
This press release contains “forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Generally, the words “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” "contemplate," "predict," “outlook,” “forecast,” “likely,” “believe,” “target,” “goal,” “objective,” “will,” “could,” “would,” “should,” "potential," "may" and similar expressions or their negative, may, but are not necessary to, identify forward-looking statements. By their nature, forward-looking statements address uncertain matters and include any statements that: are not historical, such as statements about our strategy, financial plans, outlook, objectives, plans, intentions or goals (including those related to our social, environmental and other sustainability goals); or address possible or future results of operations or financial performance, including statements relating to orders, revenues, operating margins and earnings per share growth.
Although we believe that expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition, results of operations, and any forward-looking statements are subject to change and to inherent risks and uncertainties, many of which are beyond our control. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in or implied by our forward-looking statements include, among others, the following: the impact of overall industry and general economic conditions, including industrial, governmental, and public and private sector spending, interest rates, availability of funding for customers, inflation and governments’ related monetary policy in response, and the strength of the real estate markets, on economic activity and our operations; geopolitical matters, including nationalism, protectionism and anti-global sentiment, volatility involving the U.S. and other governments, ongoing, escalation or outbreak of international conflicts, and regulatory, trade protection, economic and other risks associated with our global sales and operations; manufacturing and operating cost increases due to macroeconomic conditions, including inflation, energy supply, supply chain shortages, logistics challenges, labor shortages, trade agreements, tariffs, and other trade protection measures, and other factors; demand for our products, disruption, competition or pricing pressures in the markets we serve; cybersecurity incidents, data breaches, or other disruptions of information technology systems on which we or our customers rely, or involving our connected products and services; lack of availability or delays in receiving parts and raw materials from our supply chain, including semiconductors or other key components; operational disruptions at our facilities or that of third parties upon which we rely; safe and compliant treatment and handling of water, wastewater and hazardous materials; failure to successfully execute large projects, including as respects performance guarantees and customers’ budgets, timelines and safety requirements; our ability to retain, compete for and attract leadership, other key talent and labor; defects, security, warranty and liability claims, and recalls related to our products; uncertainty around productivity, simplification, restructuring and realignment actions and related costs and savings; our ability to execute strategic investments for growth, including acquisitions and divestitures; availability, regulation or interference with radio spectrum used by certain of our products; volatility in served markets or impacts on our business and operations due to weather conditions, including the effects of climate change; risks related to our sustainability efforts and related disclosures; fluctuations in foreign currency exchange rates; difficulty predicting our financial results; risk of future impairments to goodwill and other intangible assets; changes in our effective tax rates or tax expenses; failure to comply with, or changes in, laws or regulations, pertaining to our business conduct, operations, products and services, including anti-corruption, artificial intelligence, data privacy and security, trade, competition, the environment, climate change and health and safety; legal, governmental or regulatory claims, investigations or proceedings and associated contingent liabilities; matters related to intellectual property infringement or expiration of rights; and other factors set forth under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024 and in subsequent filings we make with the Securities and Exchange Commission (“SEC”).
Forward-looking and other statements in this press release regarding our environmental and other sustainability efforts, plans and goals are not an indication that these statements are necessarily material to investors, to our business, operating results, financial condition, outlook, or strategy, to our impacts on sustainability matters or other parties, or are required to be disclosed in our filings with the SEC or other regulatory authorities, and are not intended to create legal rights or obligations. In addition, historical, current, and forward-looking social, environmental and sustainability-related statements may be based on: standards for measuring progress that are still developing; internal controls and processes that continue to evolve, and assumptions that are subject to change in the future. All forward-looking statements made herein are based on information currently available to us as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
XYLEM INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS (Unaudited)
(In Millions, except per share data)
Year Ended December 31,
2025
2024
2023
Revenue from products
$
7,472
$
7,095
$
6,291
Revenue from services
1,563
1,467
1,073
Revenue
9,035
8,562
7,364
Cost of revenue from products
4,459
4,250
3,817
Cost of revenue from services
1,101
1,100
830
Cost of revenue
5,560
5,350
4,647
Gross profit
3,475
3,212
2,717
Selling, general and administrative expenses
1,923
1,911
1,757
Research and development expenses
226
230
232
Restructuring and asset impairment charges
103
62
76
Operating income
1,223
1,009
652
Interest expense
(29
)
(44
)
(49
)
Gain on remeasurement of previously held equity interest
—
152
—
Other non-operating income, net
18
16
33
Loss on sale of businesses
(31
)
(46
)
(1
)
Income before taxes
1,181
1,087
635
Income tax expense
(231
)
(197
)
(26
)
Net income
$
950
$
890
$
609
Net loss attributable to non-controlling interests
7
—
—
Net income attributable to Xylem
$
957
$
890
$
609
Earnings per share:
Basic
$
3.93
$
3.67
$
2.81
Diluted
$
3.92
$
3.65
$
2.79
Weighted average number of shares:
Basic
243.4
242.6
217.0
Diluted
244.0
243.5
218.2
XYLEM INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
(In Millions)
December 31,
2025
2024
ASSETS
Current assets:
Cash and cash equivalents
$
1,479
$
1,121
Receivables, less allowances for discounts, returns and credit losses of $68 and $59 in 2025 and 2024, respectively
1,759
1,668
Inventories
983
996
Prepaid and other current assets
244
236
Assets held for sale
176
77
Total current assets
4,641
4,098
Property, plant and equipment, net
1,159
1,152
Goodwill
8,332
7,980
Other intangible assets, net
2,272
2,379
Other non-current assets
1,230
884
Total assets
$
17,634
$
16,493
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
1,013
$
1,006
Accrued and other current liabilities
1,237
1,271
Short-term borrowings and current maturities of long-term debt
534
38
Liabilities held for sale
72
21
Total current liabilities
2,856
2,336
Long-term debt, net
1,408
1,978
Accrued post-retirement benefit obligations
317
304
Deferred income tax liabilities
405
497
Other non-current accrued liabilities
899
496
Total liabilities
5,885
5,611
Redeemable non-controlling interest
258
235
Stockholders’ equity:
Common stock — par value $0.01 per share:
Authorized 750.0 shares, issued 259.9 and 259.2 shares in 2025 and 2024, respectively
3
3
Capital in excess of par value
8,759
8,687
Retained earnings
3,706
3,140
Treasury stock – at cost 16.3 shares and 16.2 shares in 2025 and 2024, respectively
(768
)
(753
)
Accumulated other comprehensive loss
(220
)
(435
)
Total stockholders’ equity
11,480
10,642
Non-controlling interest
11
5
Total equity
11,491
10,647
Total liabilities, redeemable non-controlling interest, and stockholders’ equity
$
17,634
$
16,493
CONSOLIDATED STATEMENTS OF CASH FLOWS (In Millions) (Unaudited)
Year Ended December 31,
2025
2024
2023
Operating Activities
Net income
$
950
$
890
$
609
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
267
258
193
Amortization
308
304
243
Deferred income taxes
(35
)
(36
)
(79
)
Share-based compensation
53
56
60
Restructuring and asset impairment charges
103
62
76
Loss from sale of businesses
31
46
1
Gain on remeasurement of previously held equity interest
—
(152
)
—
Other, net
5
4
—
Payments for restructuring
(82
)
(32
)
(30
)
Contributions to post-retirement benefit plans
(26
)
(25
)
(25
)
Changes in assets and liabilities (net of acquisitions):
Changes in receivables
(55
)
(107
)
(87
)
Changes in inventories
23
(41
)
41
Changes in accounts payable
(22
)
64
22
Changes in accrued liabilities
(69
)
17
(4
)
Changes in accrued and deferred taxes
—
14
(109
)
Changes in long term receivables
(146
)
(37
)
1
Net changes in other assets and liabilities
(64
)
(22
)
(75
)
Net Cash — Operating activities
1,241
1,263
837
Investing Activities
Capital expenditures
(331
)
(321
)
(271
)
Proceeds from the sale of property, plant and equipment
17
4
1
Acquisitions of businesses, net of cash acquired
(163
)
(193
)
(476
)
Proceeds from sale of businesses, net of cash disposed
49
11
105
Cash received from investments
8
6
1
Cash paid for investments
(42
)
(11
)
(1
)
Cash paid for equity investments
(7
)
(6
)
(57
)
Cash received from interest rate swaps
—
—
38
Cash received from cross-currency swaps
35
29
28
Cash paid for asset acquisition
(37
)
—
—
Other, net
—
(1
)
4
Net Cash — Investing activities
(471
)
(482
)
(628
)
Financing Activities
Short-term debt issued, net
1
—
—
Short-term debt repaid
—
(268
)
—
Long-term debt issued, net
—
1
278
Long-term debt repaid, net
(82
)
(17
)
(160
)
Repurchase of common stock
(15
)
(20
)
(25
)
Proceeds from exercise of employee stock options
20
67
62
Dividends paid
(391
)
(350
)
(299
)
Other, net
(34
)
(28
)
(13
)
Net Cash — Financing activities
(501
)
(615
)
(157
)
Effect of exchange rate changes on cash
90
(53
)
23
Increase in cash classified within assets held for sale
(12
)
(11
)
—
Decrease in cash classified within assets held for sale
11
—
—
Cash classified within assets held for sale
(1
)
(11
)
—
Net change in cash and cash equivalents
358
102
75
Cash and cash equivalents at beginning of year
1,121
1,019
944
Cash and cash equivalents at end of year
$
1,479
$
1,121
$
1,019
Supplemental disclosure of cash flow information:
Cash paid during the year for:
Interest
$
61
$
67
$
69
Income taxes (net of refunds received)
$
267
$
219
$
211
% Change
Acquisitions /
Divestitures
2025
2024
8,904
8,730
174
2
%
99
%
30
(65
)
139
2
%
1
%
2,672
2,727
(55
)
(2
%)
101
%
60
(35
)
(30
)
(1
%)
(3
%)
1,893
1,824
69
4
%
102
%
-
(15
)
54
3
%
3
%
1,873
1,672
201
12
%
90
%
(30
)
(14
)
157
9
%
11
%
2,466
2,507
(41
)
(2
%)
100
%
-
(1
)
(42
)
(2
%)
(2
%)
2,391
2,196
195
9
%
100
%
10
(45
)
160
7
%
7
%
691
691
-
0
%
92
%
15
(22
)
(7
)
(1
%)
(3
%)
474
442
32
7
%
100
%
-
(10
)
22
5
%
5
%
588
473
115
24
%
110
%
(5
)
(7
)
103
22
%
23
%
638
590
48
8
%
100
%
-
(6
)
42
7
%
7
%
2,181
2,201
(20
)
(1
%)
96
%
2
(27
)
(45
)
(2
%)
(2
%)
683
700
(17
)
(2
%)
104
%
15
(13
)
(15
)
(2
%)
(4
%)
445
437
8
2
%
98
%
-
(6
)
2
-
-
446
386
60
16
%
85
%
(13
)
(5
)
42
11
%
14
%
607
678
(71
)
(10
%)
96
%
-
(3
)
(74
)
(11
%)
(11
%)
2,174
2,087
87
4
%
94
%
13
(23
)
77
4
%
3
%
672
690
(18
)
(3
%)
103
%
16
(12
)
(14
)
(2
%)
(4
%)
488
465
23
5
%
101
%
-
(5
)
18
4
%
4
%
437
384
53
14
%
81
%
(3
)
(5
)
45
12
%
13
%
577
548
29
5
%
92
%
-
(1
)
28
5
%
5
%
2,158
2,246
(88
)
(4
%)
104
%
5
30
(53
)
(2
%)
(3
%)
626
646
(20
)
(3
%)
108
%
14
12
6
1
%
(1
%)
486
480
6
1
%
112
%
-
6
12
3
%
3
%
402
429
(27
)
(6
%)
82
%
(9
)
3
(33
)
(8
%)
(6
%)
644
691
(47
)
(7
%)
114
%
-
9
(38
)
(5
%)
(5
%)
2025
2024
9,035
8,562
473
6
%
17
(71
)
419
5
%
5
%
2,636
2,555
81
3
%
48
(41
)
88
3
%
2
%
1,849
1,793
56
3
%
-
(14
)
42
2
%
2
%
2,086
1,871
215
11
%
(30
)
(13
)
172
9
%
11
%
2,464
2,343
121
5
%
(1
)
(3
)
117
5
%
5
%
2,397
2,256
141
6
%
(6
)
(48
)
87
4
%
4
%
749
727
22
3
%
4
(26
)
-
-
(1
%)
475
454
21
5
%
-
(9
)
12
3
%
3
%
534
469
65
14
%
(9
)
(7
)
49
10
%
12
%
639
606
33
5
%
(1
)
(6
)
26
4
%
4
%
2,268
2,104
164
8
%
7
(26
)
145
7
%
7
%
656
623
33
5
%
15
(14
)
34
5
%
3
%
456
447
9
2
%
-
(5
)
4
1
%
1
%
522
458
64
14
%
(8
)
(6
)
50
11
%
13
%
634
576
58
10
%
-
(1
)
57
10
%
10
%
2,301
2,169
132
6
%
11
(23
)
120
6
%
5
%
650
631
19
3
%
19
(12
)
26
4
%
1
%
483
456
27
6
%
-
(6
)
21
5
%
5
%
540
482
58
12
%
(8
)
(4
)
46
10
%
11
%
628
600
28
5
%
-
(1
)
27
5
%
5
%
2,069
2,033
36
2
%
5
26
67
3
%
3
%
581
574
7
1
%
10
11
28
5
%
3
%
435
436
(1
)
(0
%)
-
6
5
1
%
1
%
490
462
28
6
%
(5
)
4
27
6
%
7
%
563
561
2
0
%
-
5
7
1
%
1
%
2,397
-
2,397
2,256
-
2,256
353
103
456
267
110
377
14.7
%
19.0
%
11.8
%
16.7
%
(6
)
-
(6
)
(9
)
-
(9
)
5
-
5
5
-
5
-
-
-
152
(152
)
-
16
(16
)
-
(40
)
40
-
368
87
455
375
(2
)
373
(35
)
(74
)
(109
)
(49
)
(37
)
(86
)
333
13
346
326
(39
)
287
2
-
2
-
-
-
335
13
348
326
(39
)
287
244.2
244.2
243.8
243.8
$
1.37
$
0.05
$
1.42
$
1.34
($
0.16
)
$
1.18
9,035
-
9,035
8,562
-
8,562
1,223
389
1,612
1,009
364
1,373
13.5
%
17.8
%
11.8
%
16.0
%
(29
)
-
(29
)
(44
)
-
(44
)
18
-
18
16
-
16
-
-
-
152
(152
)
(31
)
31
-
(46
)
46
-
1,181
420
1,601
1,087
258
1,345
(231
)
(137
)
(368
)
(197
)
(107
)
(304
)
-
-
-
950
283
1,233
890
151
1,041
7
-
7
-
-
-
957
283
1,240
890
151
1,041
244.0
244.0
243.5
243.5
$
3.92
$
1.16
$
5.08
$
3.65
$
0.62
$
4.27
2025
169
226
227
335
957
8.2
%
9.8
%
10.0
%
14.0
%
10.6
%
68
69
64
66
267
77
76
78
77
308
-
3
-
(1
)
2
50
75
71
35
231
364
449
440
512
1,765
12
13
12
16
53
27
29
30
45
131
12
13
9
2
36
10
-
37
(16
)
31
(2
)
(2
)
(1
)
(2
)
(7
)
423
502
527
557
2,009
2,069
2,301
2,268
2,397
9,035
20.4
%
21.8
%
23.2
%
23.2
%
22.2
%
2024
153
194
217
326
890
7.5
%
8.9
%
10.3
%
14.5
%
10.4
%
61
62
68
67
258
73
83
73
75
304
7
6
5
(2
)
16
43
53
52
49
197
337
398
415
515
1,665
18
13
12
13
56
15
29
11
36
91
16
13
7
21
57
-
-
-
(152
)
(152
)
5
(1
)
2
40
46
391
452
447
473
1,763
2,033
2,169
2,104
2,256
8,562
19.2
%
20.8
%
21.2
%
21.0
%
20.6
%