Xylem Inc.’s XYL second-quarter 2026 adjusted earnings of $1.46 per share beat the Zacks Consensus Estimate of $1.34. The bottom line increased 15.9% year over year.
XYL’s revenues of $2.34 billion beat the consensus estimate of $2.33 billion. The top line increased 1.5% year over year, driven by strength in Transport, Energy Metering, Building Solutions and capital projects in heavy industries. Organic revenues increased 1% in the quarter.
Also, orders of $3.09 billion increased 42% year over year on a reported basis and 41% on an organic basis.
XYL's Segmental Details
Revenues in the Water Infrastructure segment totaled $683 million, up 5% year over year. Organic sales increased 3%, driven by strength in Transport, which more than offset weakness in Treatment and China. The Zacks Consensus Estimate was pegged at $664 million.
The Applied Water segment generated revenues of $501 million, up 4% year over year. Organic sales increased 3% in the quarter, driven by strength in the commercial end market. The Zacks Consensus Estimate was pegged at $492 million.
Quarterly revenues of the Measurement & Control Solutions segment totaled $508 million, down 6% year over year. Organic sales declined 1%, as strength in Energy Metering and VUE demand partly offset lower revenues. The Zacks Consensus Estimate was pegged at $538 million.
Quarterly revenues at the Water Solutions and Services segment totaled $644 million, up 3% year over year. Organic sales increased 1%, driven by strength in capital projects and Dewatering. The Zacks Consensus Estimate was pegged at $636 million.
Xylem Inc. Price and EPS Surprise
Xylem Inc. price-eps-surprise | Xylem Inc. Quote
XYL’s Margin Profile
Xylem’s adjusted EBITDA was $544 million, up 8.4% from the year-ago quarter’s level. The margin improved to 23.3% from 21.8% in the prior-year quarter.
Adjusted operating income was $447 million, up 11.2% year over year. Adjusted operating margin increased to 19.1% from 17.5% in the year-earlier quarter.
Xylem’s Balance Sheet and Cash Flow
Exiting the second quarter, Xylem had cash and cash equivalents of $1.28 billion compared with $1.48 billion at the end of December 2025. Long-term debt was $2.40 billion at the end of the quarter compared with $1.41 billion at the end of December 2025.
In the first six months of 2026, XYL generated net cash of $398 million from operating activities compared with $338 million in the year-ago period. Capital expenditure was $179 million, up 5.9% from the year-earlier period.
Rewards to Shareholders
In the first six months of 2026, Xylem paid dividends of $207 million, up 5.6% year over year. The company also bought back shares worth $1.24 billion in the same period compared with $13 million in the year-ago period.
XYL's 2026 Guidance
Xylem has updated its 2026 outlook. The company now expects revenues of approximately $9.2 billion compared with the previous projection of $9.2-$9.3 billion. This indicates growth of approximately 2% from the prior-year level on a reported basis and 2-3% on an organic basis.
Adjusted EBITDA margin is estimated to be approximately 23.1-23.5%, indicating an expansion of 90-130 basis points from the year-earlier actual.
XYL forecasts adjusted earnings in the range of $5.55-$5.70 per share, up from the previous guidance of $5.35-$5.60.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Companies
Pentair plc PNR came out with quarterly earnings of $1.14 per share in the second quarter of 2026, beating the Zacks Consensus Estimate of $1.12 per share. This compares with earnings of $1.39 per share a year ago.
PNR posted revenues of $932.6 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 7.84%. This compares with year-ago revenues of $1.12 billion.
WEX Inc.’s WEX adjusted earnings (excluding $2.24 from non-recurring items) in second-quarter 2026 were $5.35 per share, which surpassed the Zacks Consensus Estimate by 5.3% and increased 35.4% year over year.
Revenues were $753.5 million, topping the consensus estimate by 1.8% and rising 14.2% year over year.
Comstock Inc. LODE came out with a quarterly loss of $0.13 per share compared with the Zacks Consensus Estimate of a loss of $0.12 in the second quarter of 2026. This compares with a loss of $0.27 per share a year ago.
LODE posted revenues of $0.27 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 80.16%. This compares with year-ago revenues of $0.34 million.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
See Stocks Now >>Xylem Inc. (XYL) : Free Stock Analysis Report
Pentair plc (PNR) : Free Stock Analysis Report
WEX Inc. (WEX) : Free Stock Analysis Report
Comstock Inc. (LODE) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
