This audio is auto-generated. Please let us know if you have feedback.
By the numbers: Waste Connections Q2
Net income: $296.4M
Up 2.1% year over year
Adjusted EBITDA: $840.1M
Up 6.8% year over year, a margin of 32.8% of revenue
- Financial picture: Q2 earnings were “above expectations” due to a combination of factors such as fuel cost recovery, improving commodity trends and acquisitions, said President and CEO Ron Mittelstaedt during Waste Connections’ earnings call on Thursday. That recovery came “in spite of ongoing geopolitical instability and the associated uncertainty,” he said. Ongoing employee retention and safety efforts also helped improve solid waste margin expansion, added CFO Mary Anne Whitney, resulting in savings in risk management costs.
- Price: Solid waste core price for the quarter was 5.6%. That ranged from about 4% in the company’s mostly exclusive Western region market, to 7% in its competitive region. The company expects to stay on track with a full-year core price of about 5.5%, she said.
- Fuel surcharges: Total price for the quarter was 6.7% due to a 1.1% fuel and material surcharge meant to mitigate the higher fuel prices that have been a concern for the industry. Such surcharges amounted to about $25 million in the quarter, Whitney said. Yet those surcharges likely “exacerbated churn in certain markets,” due to customer price sensitivity, she said.
- Volume: Solid waste volumes were down 1.9%, “reflecting the ongoing macroeconomic uncertainty, which has limited growth in the solid waste activity,” and also impacted construction-related activity, Whitney said. Landfill tons were flat in the quarter, while C&D tons were up year over year for the first time in 10 quarters due to an uptick in projects expected to continue into Q3.
- Recycled commodities recovery: Recycled commodity revenues were up for the second consecutive quarter, with the overall commodities basket fetching between 10% to 15% more compared to the end of 2025, Mittelstaedt said.
- RNG improvements: Landfill gas sales have also improved by 15% from Q1, Mittelstaedt said. That’s partly because of higher gas generation and higher values for renewable energy credits. About a third of the planned RNG portfolio is already operational, and remaining RNG projects are ahead of schedule, he said. A new facility came online in July, and the company plans to complete capital outlays by the end of the year. “We expect that all plants will be operational by early next year,” he said.
- M&A updates: Waste Connections has completed acquisitions worth over $100 million in annualized revenue. It also expects to close another $30 million of “exclusive model franchise transactions,” and “dialogue is ongoing” on other potential solid waste deals spanning collection and transfer, processing, disposal and E&P, he said. Meanwhile, contributions from acquisitions, net of divestitures, was about $46 million dollars in the quarter, Whitney added.
- New property purchases: Waste Connections spent $51 million on facility-related real estate in Florida, which Whitney said was a “strategic and opportunistic” chance to secure land in an otherwise expensive and competitve market. She did not specify what the property would be used for, but said would be for a future facility development and not for a landfill expansion. CRE Sources reported that the property was a 12-acre industrial property previously used as a truck terminal.
- Raised outlook: Waste Connections raised its full-year outlook to reflect improving commodities trends and acquisition contributions. The new revenue outlook is between $10.02 billion to $10.05 billion, and adjusted EBITDA outlook is between $3.33 billion to $3.34 billion.
