Xylem Delivers Robust Q3 2025 Results with Accelerated Margin Expansion and Raised Full-Year Guidance
Q3 Revenue Growth Exceeds Expectations, Led by Double-Digit Gains in Key Segments
Xylem Inc. (NYSE: XYL), a leader in water technology solutions, announced its third-quarter 2025 results with total revenue of $2.27 billion, up 8% year-over-year on a reported basis (7% organically). All business segments posted gains, while Measurement and Control Solutions, as well as Water Solutions and Services, recorded double-digit revenue growth. The company credits strong execution and persistent demand as key drivers.
"Revenue grew across all segments, with double-digit gains in Measurement and Control Solutions and Water Solutions and Services. Record adjusted EBITDA margin reflected the impact of our simplification initiatives," noted Matthew Pine, Xylem's President and CEO.
Significant Margin Expansion Drives 23% Growth in Adjusted EPS
Profitability continued its positive momentum this quarter. Xylem reported net income attributable to shareholders of $227 million (or $0.93 per share), while adjusted earnings per share (EPS) reached $1.37—an increase of 23% versus last year. The company's adjusted EBITDA margin for Q3 stood at 23.2%, a notable jump of 200 basis points compared to Q3 2024. These improvements were propelled by productivity gains, pricing actions, and increased volumes, outpacing inflationary pressures and investment costs.
| Q3 2025 | Q3 2024 | Year-over-Year Change | |
|---|---|---|---|
| Revenue ($M) | 2,268 | 2,104 | +8% |
| Adjusted EPS | $1.37 | $1.11 | +23% |
| Adjusted EBITDA Margin | 23.2% | 21.2% | +200 bps |
| Net Income ($M) | 227 | 217 | +5% |
Segment Review: Measurement and Control Solutions, and Water Solutions Lead Growth
Not all segments contributed equally. Measurement and Control Solutions grew revenues by 14% year-over-year, while Water Solutions and Services delivered a 10% rise. This momentum outpaced other divisions, further underscoring the value of Xylem’s diversified portfolio.
| Segment | Q3 2025 Revenue ($M) | Q3 2024 Revenue ($M) | Year-over-Year Change |
|---|---|---|---|
| Measurement & Control Solutions | 522 | 458 | +14% |
| Water Solutions & Services | 634 | 576 | +10% |
| Water Infrastructure | 656 | 623 | +5% |
| Applied Water | 456 | 447 | +2% |
Guidance Raised on Confidence in Execution and Resilient Demand
On the back of its performance, Xylem has raised its full-year 2025 guidance. Management now forecasts total revenue of approximately $9.0 billion (up 5-6% on a reported basis, versus the previous 4-5%), and adjusted EPS in the range of $5.03 to $5.08 (higher than the prior $4.70 to $4.85 outlook). Adjusted EBITDA margin for the full year is now anticipated at 22.0-22.3%.
| 2025 Guidance (Updated) | Prior Guidance | |
|---|---|---|
| Revenue | ~$9.0 billion | Up 5-6% |
| Adjusted EPS | $5.03-$5.08 | $4.70-$4.85 |
| Adj. EBITDA Margin | 22.0-22.3% | +140 to 170 bps vs 2024 |
| Free Cash Flow Margin | 9-10% | Unchanged |
Takeaway: Margin Expansion and Diversified Growth Highlight Strong Positioning
Xylem's Q3 2025 performance demonstrates the advantages of operational discipline and portfolio diversity, especially amid global economic uncertainties. Margin expansion, sustained demand, and raised full-year outlook suggest the company remains well positioned for ongoing value creation. Investors and analysts will be watching if this growth momentum and cost control can be maintained in future quarters, especially as global economic conditions remain fluid.
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