Xylem's Q1 Earnings & Revenues Top Estimates, Orders Down Y/Y

Xylem Inc.’s XYL first-quarter 2025 adjusted earnings of $1.03 per share beat the Zacks Consensus Estimate of 95 cents. The bottom line increased 14% year over year.

XYL’s revenues of $2.07 billion beat the consensus estimate of $2.04 billion. The top line increased 2% year over year, driven by resilient demand reflected by solid order growth across segments. Organic revenues rose 3%.

Orders of $2.16 billion decreased 4% year over year on a reported basis and fell 2% on an organic basis. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

XYL's Segmental Details

Revenues in the Water Infrastructure segment totaled $581 million, up 1% year over year. Organic sales increased 5% year over year, buoyed by the solid demand for its products and solutions for the transportation and treatment of water, including pumps, filtration and treatment equipment. The Zacks Consensus Estimate was pegged at $575 million.

The Applied Water segment generated revenues of $435 million, flat year over year. Organic sales were up 1% on a year-over-year basis. The segmental performance was driven by strength in the building solutions market. The consensus estimate was pegged at $429 million.

Quarterly revenues of the Measurement & Control Solutions segment totaled $490 million, up 6% year over year. The Zacks Consensus Estimate was pegged at $466 million. Organic sales were up 6% year over year, driven by energy metering demand and growth in analytics.

Quarterly revenues at the Water Solutions and Services segment totaled $563 million, flat year over year. Organic sales were up 1% year over year, supported by service. The consensus estimate was pegged at $565 million.

Xylem Inc. Price, Consensus and EPS Surprise

Xylem Inc. price-consensus-eps-surprise-chart | Xylem Inc. Quote

XYL’s Margin Profile

Xylem’s adjusted EBITDA was $423 million, up 8.2% from the year-ago quarter’s level. The margin improved to 20.4% from 19.2% in the prior-year quarter.

Adjusted operating income was $325 million, up 10.5% year over year. Adjusted operating margin increased to 15.7% from 14.5% in the year-earlier quarter.

Xylem’s Balance Sheet and Cash Flow

Exiting the first quarter, Xylem had cash and cash equivalents of $1.06 billion compared with $1.12 billion at the end of December 2024. Long-term debt was $1.97 billion at the end of the quarter compared with $1.98 billion at the end of December 2024.

In the first three months of 2025, XYL generated net cash of $33 million from operating activities compared with $89 million in the year-ago period. Capital expenditure was $71 million, down 4.1% from the year-earlier period.

Rewards to Shareholders

In the first quarter, Xylem paid dividends of $98 million, up 11.4% year over year. The company also bought back shares worth $12.9 million in the same period compared with $15 million in the year-ago period.

XYL's 2025 Guidance

Xylem expects revenues to be in the range of $8.7-$8.8 billion for 2025. This indicates an increase of 1-2% from the prior-year level on a reported basis and 3-4% on an organic basis.

Adjusted EBITDA margin is estimated to be approximately 21.3-21.8%, indicating an expansion of 70-120 basis points from the year-earlier actual.

XYL forecasts adjusted earnings to be in the range of $4.50–$4.70 per share. This metric indicates an increase from earnings of $4.27 per share in 2024.

Zacks Rank & Stocks to Consider

Xylem presently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked companies are discussed below:

Griffon Corporation GFF currently sports a Zacks Rank of 1. GFF delivered a trailing four-quarter average earnings surprise of 14.7%. In the past 60 days, the consensus estimate for Griffon’s fiscal 2025 (ending September 2025) earnings has increased 2.9%.

Federal Signal Corporation FSS currently carries a Zacks Rank #2 (Buy). FSS delivered a trailing four-quarter average earnings surprise of 9.5%. In the past 60 days, the Zacks Consensus Estimate for Federal Signal’s 2025 earnings has increased 0.8%.

AerSale Corporation ASLE presently sports a Zacks Rank 1. ASLE delivered an earnings surprise of 28.6% in the last reported quarter. In the past 60 days, the consensus estimate for AerSale’s 2025 earnings has increased 32.1%.

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