Our SEC filings, our earnings press release, which includes GAAP reconciliation tables and a discussion of business activities, along with a recording of this call, are available on Republic's website at republicservices.com. Even with persistent headwinds in construction and manufacturing markets, we generated solid earnings growth and margin expansion. Continued investment in our differentiated capabilities positions us well to drive sustainable growth and enhance long-term shareholder value. Our commitment to delivering world-class service continues to support organic growth by reinforcing our position as a trusted partner for our 13 million customers.
Organic revenue growth during the third quarter was driven by strong pricing across the business. Average yield on total revenue was 4%, and average yield on related revenue was 4.9%. Organic volume decreased total revenue by 30 basis points and related revenue by 40 basis points in the quarter. The increase in C&D tons related to hurricane recovery efforts in the Carolinas.
Special waste activity was driven by an increase in event-driven volumes across many of our disposal assets, primarily located in Sun Belt geographies. Organic revenue decline in the environmental solutions business created a 140 basis point headwind to total company revenue this quarter. Given the relatively fixed cost structure of these assets and services, the impact on environmental solutions' EBITDA and margin was more pronounced. While the environmental solutions business was down both sequentially and year-over-year, demand stabilized exiting the third quarter.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year 2025 guidance | FY2025 | No formal update; year-to-date free cash flow $2.19 billion (62% of projected full-year CapEx spent) |
| Long-term growth algorithm | Through-cycle | Mid-single-digit revenue growth; EBITDA, EPS, and free cash flow growing faster; 30-50 bps of EBITDA margin expansion per year |
| 2026 initial perspective | FY2026 | Long-term growth algorithm intact but each metric down a click on tougher comps; ~$100 million of non-repeating 2025 event-driven landfill revenue at 80% incremental margin to overcome; full guidance in February |
| Price-cost spread | FY2026 | Cost inflation roughly in line with CPI; yield expected 75-100 bps above that |
| RNG projects | FY2025 | Six online year-to-date; total of seven RNG projects expected to commence in 2025 |
| EV fleet | FY2025 | 137 vehicles at end of Q3; more than 150 EVs expected by year-end |
| ES Q4 | Q4 2025 | Margin in same zip code, overcoming a tough Q4 2024 comp (high-margin job), building up from there in 2026 |
| Metric | YoY | Note |
|---|---|---|
| Revenue growth | +3.3% | Strong pricing partly offset by ES decline, volume softness, and lower commodity prices |
| Adjusted EBITDA growth | +6.1% | Disciplined pricing above cost inflation, strong operational execution, and event-driven landfill volumes |
| Adjusted EBITDA margin | +80 bps to 32.8% | Underlying business +90 bps and +40 bps event-driven landfill volumes, offset by -20 bps net fuel, -20 bps commodity prices, -10 bps acquisitions |
| Adjusted EPS | $1.90 | Earnings growth and margin expansion |
| Average yield on related revenue | 4.9% | Strong pricing including open market 8.6% and restricted 4.8% |
| Organic volume (related revenue) | -40 bps | Large container -3.9% and residential -2.4%, offset by landfill C&D +45% (hurricane) and special waste +18% |
| Recycled commodity price | $126/ton vs $177/ton prior year | Lower recycled commodity prices; polymer center volumes and West Coast reopening partial offset |
| ES revenue | -$32 million (140 bps headwind) | Manufacturing softness, lower event/E&P volumes, fewer emergency response jobs; ES margin 20.3% |
| Recycling and waste margin | +150 bps to 34.3% | Pricing above cost inflation, labor productivity from RISE (labor as % of revenue improved 70 bps), and event-driven volumes |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Environmental Solutions weakness/recovery | Pricing-volume tradeoff and softness | Down sequentially and year-over-year but demand stabilized exiting Q3 (September better than August, similar in October); pipeline now expanding; found the bottom and rebuilding, with results showing more in 2026 | — |
| Pricing discipline / price-cost spread | Pricing ahead of inflation | Maintaining 75-100 bps yield premium over CPI-like cost inflation; ES still viewed as long-term underpriced; progress not linear quarter to quarter | — |
| Labor disruption | N/A | Localized union strikes resulted in $56 million Q3 adjustment (incl. $16 million revenue credits); impact believed fully captured with no expected longer-term labor cost impact; about one-third of frontline workforce unionized under local contracts | — |
| M&A pipeline | Strong and supportive | Very strong, tilted toward recycling and waste; focus on small and medium-sized deals into 2026-2027; acquired a West Coast recycling/reclaimer facility tied to the polymer center value chain | — |
| Polymer Centers / plastics | Las Vegas ramp | Indianapolis commenced commercial production in July; Blue Polymers expected late Q4; demand strong with stable input-output spread; more plastics M&A more likely 2027 and beyond | — |
| Digital / RISE productivity | N/A | RISE driving labor productivity; labor as % of revenue improved 70 bps in the quarter; AI a longer-term lever for routing efficiency | — |
| Macro / manufacturing and construction | Persistent softness | Manufacturing slow with trade-policy uncertainty and tariff prebuilding; activity slowed in June-August then starting to pick up; no signs of life yet in construction but medium-to-long-term bullish on housing demand | — |
| Fleet electrification | N/A | 137 EVs at end of Q3, 150+ expected by year-end, 32 charging facilities; some loss of federal incentive may slow pace at the margin but customer demand and state/local incentives support continued rollout | — |