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By the numbers: Q2 2025
Revenue: $4.24B
Up 4.6% year over year
Net income: $550M
Up 7.4% versus prior year, with a margin of 13%
Adjusted EBITDA: $1.36B
Up 8.2% year over year, with a margin of 32.1%
- Overall results: A down market for manufacturing weighed on Republic Services' earnings, particularly its environmental services business, but the company still reported growth in revenue and margins for the quarter. CEO Jon Vander Ark attributed organic revenue growth to pricing in excess of inflation. While core price was down year over year, the company still reported that core price on total revenue increased revenue by 5.7%.
- Labor disruption: Republic projects the strikes and extended picket lines several chapters of the International Brotherhood of Teamsters called this month could cause a $25 million to $50 million impact on adjusted earnings before income, taxes, depreciation and amortization in 2025. Vander Ark said the company primarily felt the impact through the increased costs from bringing in outside workers to replace those on strike in markets like the Boston area, where the strikes began on July 1. The company also plans to issue "some credits" to affected customers, though executives did not detail that plan. "We're actively ready to negotiate and hopefully get through it quickly, but we're also prepared for any scenario," Vander Ark said.
- Volumes: Cleanup from hurricane debris in the Carolinas and wildfire debris in California provided a significant tailwind to landfill volumes. C&D waste was up 47.3% and special waste was up 22.4% in Q2, while MSW was down 2.1%. On collections, residential volumes were down 3.2%. Large container waste was also down 3.4%, which executives said reflects continued softness in the construction market.
- Environmental Solutions: Republic Services’ environmental services business saw a 2.4% decrease in revenue year over year. Executives attributed that to continued softness in manufacturing activity, as well as tariff uncertainty and lower event-based volumes compared to last year. The segment still grew 1.6% in the first half of 2025 compared to the first half of 2024 due to a particularly strong Q1. Shamrock Environmental, which Republic acquired at the start of the year, is expected to contribute positively to earnings as well for the year.
- Manufacturing slump: CFO Brian DelGhiaccio noted that since Republic Services acquired US Ecology in 2023, the manufacturing environment has been in a slump. That's impacted not just the company's environmental services segment but its $1.5 billion market vertical in recycling and waste that's focused on manufacturing end markets, he said. But executives expect the macro environment for manufacturing to turn around in the coming years and improve the business as a whole. "What we've done in a negative demand environment gives us a lot of confidence and really encourages us about what the future could bring when manufacturing activity actually resumes," DelGhiaccio said.
- Recycling: Republic's average recycled commodity price per ton was $149 in Q2, down $24 per ton year over year. Nevertheless, revenue from recycling processing and commodity sales were up slightly year over year, driven by increased volumes at the company's polymer centers and the reopening of a facility on the West Coast. Republic's Indianapolis Polymer Center began commercial production in July, and is projected to reach commercial production in Q4.
- Sustainability: Republic issued its 2024 sustainability report this week, highlighting its progress on reducing emissions. On the call, executives highlighted sustainability efforts like its fleet electrification initiative. Republic is still on track to have 150 electric collection vehicles in operation by the end of the year, and currently has 114 in operation. The company also brought four renewable natural gas facilities online in Q2, and plans to open seven total by the end of the year.
- Guidance: The company opted to revise down its full-year revenue guidance by $175 million, and now projects a range of $16.675 billion to $16.75 billion. That was due to lower commodity prices and volumes. Republic's adjusted EBITDA guidance remained the same, while its adjusted free cash flow guidance increased slightly to reflect the contributions from 100% bonus depreciation enacted in the recent tax bill.
