Xylem has announced its financial performance for the first quarter of 2025, reporting revenues of $2.1 billion, which reflects a 2% increase on a reported basis and a 3% increase on an organic basis. The company also disclosed earnings per share (EPS) of $0.69, indicating a 10% rise, while adjusted EPS grew by 14% to reach $1.03. Xylem has reaffirmed its full-year guidance for adjusted EPS in 2025.
The revenue growth during the first quarter was bolstered by strong demand and effective execution, although foreign exchange challenges acted as a partial offset.
“The team’s results for the first quarter surpassed expectations, maintaining our momentum and providing a robust start to 2025,” stated Matthew Pine, Xylem’s president and CEO. “Organic revenue increased across all segments due to healthy demand, with our book-to-bill ratio exceeding one. The team’s operational discipline resulted in a 120 basis point margin expansion and double-digit growth in EPS.”
Net income attributable to Xylem was $169 million, or $0.69 per share, with a net income margin of 8.2%, showing a 70 basis point improvement. This increase in net income was driven by operational strength and lower interest expenses, although it was partially offset by higher restructuring and realignment expenses, increased tax liabilities, and losses from the sale of certain businesses.
Adjusted net income amounted to $251 million, or $1.03 per share. These adjustments excluded items such as amortization of purchase accounting intangibles, restructuring and realignment expenses, special charges, losses from business sales, and related tax impacts.
Xylem forecasts full-year 2025 revenues to be between $8.7 billion and $8.8 billion, indicating growth of 1–2% on a reported basis, a slight increase from its previous guidance of 0–2%. The adjusted EBITDA margin for the quarter reached 20.4%, representing a year-over-year increase of 120 basis points. This improvement was primarily due to productivity enhancements and effective pricing strategies, which outweighed inflationary pressures and an unfavorable product mix.
“Our transformation of the operating model – encompassing our high-impact culture, process simplification efforts, and segment-focused restructuring – is advancing well, enhancing our agility and boosting profitability in a more dynamic environment. We are serving our customers more efficiently and reducing wasted time and effort internally, allowing our teams to operate more swiftly, with greater focus and accountability. Despite the current market volatility, we expect continued resilience in volumes, supported by the essential nature of our customers’ services and Xylem’s strong alignment with operational expenditure-driven spending. We are countering the current tariff impacts with strategic pricing and proactive supply chain management. Consequently, we are reaffirming our full-year adjusted EPS guidance,” Pine added.
Xylem anticipates full-year 2025 revenues between $8.7 billion and $8.8 billion, reflecting growth of 1–2% on a reported basis, slightly raised from the previous estimate of 0–2%. Organic revenue growth is still projected at 3–4%.
The adjusted EBITDA margin is expected to be in the range of 21.3% to 21.8%, indicating a 70 to 120 basis point increase over 2024. The guidance for full-year adjusted EPS remains at $4.50 to $4.70. Free cash flow margin is projected to be between 9% and 10%.
Source: Xylem
