From The Motley Fool · Motley Fool Transcribing · · 2m
Xylem Q3 2026 Earnings Report Highlights
Xylem reports $2.2 billion revenue with 10% organic growth in orders despite slower project conversions.
In brief
Xylem reports $2.2 billion revenue with 10% organic growth in orders despite slower project conversions. Xylem's Q3 2026 earnings show $2.2 billion revenue, 10% organic order growth, and plans to restructure into three segments by 2027. Originally reported by The Motley Fool.
Q3 Revenue Results
Xylem reported $2.2 billion revenue, flat organically due to project timing and cautious utility spending.
Orders Growth
Orders increased $2.3 billion, growing 10% organically behind water and gas metering strength and data center wins.
Adjusted EPS
Adjusted EPS rose to $1.44, increasing 5% compared to the prior year.
Backlog Expansion
Backlog grew to $5.5 billion, increasing 13% versus the prior year reflecting healthy underlying demand.
MCS Orders
MCS orders grew 30% in the quarter behind large water and gas metering awards scheduled for late 2027.
Applied Water Orders
Applied Water orders increased 15% due to strength in data center wins and U.S. commercial building business.
Data Center Orders
Data center orders increased over 200% in the quarter within the Applied Water segment.
WSS Orders
WSS orders grew 6% led by strength in capital project demand.
Planned Divestitures
Planned divestitures include Applied Water International and Specialty Flow Control, representing 9% of revenue but less than 5% of EBITDA.
Full-Year Revenue Guidance
Full-year revenue guidance is approximately $8.95 billion, trending flat on an organic basis due to slower-than-expected project conversion.
Full-Year EPS Guidance
Full-year adjusted EPS guidance is $5.40 to $5.45, decreasing from previous guidance because of lower sales volumes.
Q4 Organic Revenue Guidance
Q4 organic revenue guidance declines 1% to 2% as more backlog is scheduled to ship in later periods.
Q4 Adjusted EPS Guidance
Q4 adjusted EPS guidance is $1.39 to $1.44 while maintaining EBITDA margins of approximately 24.5%.
Year-to-Date Free Cash Flow
Year-to-date free cash flow is $444 million, slightly lower than the prior year due to working capital and investments in outsourced water contracts.
Net Debt to EBITDA
Net debt to adjusted EBITDA is 1.1x following opportunistic share repurchases during the quarter.
China Revenue Exposure
China revenue exposure is expected to decline from 2% to 1% of total revenue following planned divestitures.
At a glance
Xylem's Q3 2026 earnings show $2.2 billion revenue, 10% organic order growth, and plans to restructure into three segments by 2027.
