Jul 23, 2026 earnings call — Increased full-year outlook and margins
Company raised its full-year 2026 revenue outlook to $10.02 billion to $10.05 billion.
Revenue $2.5B (est $2.5B) · EPS $1.50 (est $1.35)
Key quotes
"Revenue is now estimated in the range of $10.02 billion to $10.05 billion, up $100 million to $120 million from February."
"And we expect about $100 million or 100 basis points, which is about the same of improvement in EBITDA as we come through '28 into '29."
"R&D capital outlays are on track to be essentially complete by year-end, and we expect that all plants will be operational by early next year."
Analyst Q&A 17
fuel spike and customer churn
Q (Tyler Brown · Raymond James): Is the fuel move causing more churn from smaller haulers? Also, what is the M&A rollover impact from 2026 into 2027?
A: Management said the fuel spike was faster than normal and caused some additional competitive activity. They are not seeing anything materially different historically, but the spike probably added about 10 to 15 basis points of volume churn in the quarter. Mary Anne said acquisition rollover to next year would be about $30 million and the increase to the full year outlook included about $50 million associated with '26.
"So it's not anything material, but it probably accounted for an additional 10 to 15 basis points of volume churn in the quarter related to that." — Ronald Mittelstaedt (CEO)
Canada energy projects and idle facilities
Q (Kevin Chiang · CIBC): Will more energy CapEx in Canada help R360 Canada? How many facilities could you reopen if activity picks up?
A: They have 2 to 3 idle facilities that can be reopened from the original 5 they acquired. Management said they are well positioned to benefit if energy projects happen, but they have not yet seen that; Canada was relatively flat and coming off a strong comp in Q2 last year.
"there's still 2 to 3 idle facilities that can be reopened of the original 5 from when we acquired the secure divested assets up there." — Ronald Mittelstaedt (CEO)
July activity pickup vs Q2
Q (Faiza Alwy · Deutsche Bank): Did July show a broad pickup and was the competitive environment different from 2Q?
A: They cautioned they only saw about 3 weeks of July so far. Management said they saw continued pickup in special waste and in several regions of C&D, and MSW was up nominally for the last 4 consecutive weeks, but they called it cautiously optimistic and did not put it into guidance.
"we have seen some continued pickup in both special ways and in several of our regions of C&D, MSW has been up nominally so far for the last 4 consecutive weeks, which is an improvement relative to the May, June time frame." — Ronald Mittelstaedt (CEO)
Chiquita impairment and cash outlays
Q (James Schumm · TD Cowen): Does the $58 million Chiquita impairment reflect Q2 spend? Where are you tracking year-to-date versus the $100 million to $150 million guidance?
A: Management said the impairment was a GAAP matching of the closure accrual to projected run-rate cash outflows and not indicative of Q2 spend. They said there is no change to the $100 million to $150 million cash outflows in 2026 and they are tracking year-to-date somewhere between the middle, $125 million and $150 million and are comfortable in that range for the full year.
"we're tracking probably somewhere between the middle, $125 million and $150 million at this point in time, but comfortable in that range for the full year." — Ronald Mittelstaedt (CEO)
underlying margin deceleration reasons
Q (Konark Gupta · Scotiabank): Is the slower margin expansion purely due to comps or is something else driving it into the second half?
A: Management said it is mainly about comps and anniversarying large prior benefits like disposal and risk improvements. They reiterated prior drivers: employee retention and safety benefits (about 100 basis points) and a lagging risk component that has added 30 to 40 basis points for three quarters; Ron added the Chiquita closure anniversary also affected comps.
"And that the final piece would be the risk component, which would lag and you've now seen 3 quarters of 30 to 40 basis points benefit from risk." — Mary Whitney (CFO)
CapEx, RNG, and Chiquita outlays
Q (Toni Kaplan · Morgan Stanley): How should we model free cash flow, fleet and landfill CapEx, RNG R&D, and are Chiquita outlays straight line or lumpy?
A: They said Chiquita outlays can be lumpy but modeling them straight line is probably fine. CapEx is in line with expectations and up year-over-year due to delays last year; the bulk is fleet and landfill work. They reiterated $75 million in R&D for RNG this year and expect to spend that amount, leaving de minimis RNG CapEx in '27 and supporting a free cash flow inflection in '27.
"we've mentioned that there were $75 million in R&D that we expected this year and the update is we expect to spend that amount." — Mary Whitney (CFO)
cost inflation and margin outlook
Q (Bryan Burgmeier · Citi): How should we think about cost inflation for wages, maintenance, and other items vs your February guide?
A: They maintained the underlying solid waste margin expansion at 50 to 70 basis points. Fuel has become more punitive, costing about 20 to 30 basis points, while commodities offset some of that; overall cost pressures are in the 3.5% to 4% range with wages being the primary driver and behaving in line with expectations.
"in our guidance, we've maintained the underlying solid waste margin expansion in the range of 50 to 70 basis points." — Mary Whitney (CFO)
AI programs and special waste drivers
Q (Andrew Azzi · Wells Fargo): What AI initiatives are running through '27 and their EBITDA impacts? Also, what verticals drove special waste strength?
A: They gave specific AI timelines and estimated impacts: commercial pricing deployed in Q4 '25 yielded about $20 million of EBITDA run-rate through '26; a dynamic routing AI is in pilot late Q2 '26 and set to be fully deployed end of '27 with expected $40 to $50 million route savings in '28-'29; customer-service AI deploys in 2Q '27 and will reach full deployment in 2028 with $20 to $35 million initial EBITDA impact. On special waste, management said it can be lumpy, is a small piece of revenue, and recent swings reflect timing and project pauses but indicate underlying cyclical demand.
"In '25, we fully deployed our AI linked what we call pro pricing -- commercial pricing tool, and that is fully deployed by the fourth quarter of '25 and has yielded about $20 million of EBITDA improvement on a run rate basis at this point through '26." — Ronald Mittelstaedt (CEO)
cash flow conversion into 2027
Q (Chris Murray · ATB Cormark): With RNG normalizing and Chiquita rolling off, how should we think about cash flow conversion in 2027?
A: They said it's early to be specific but they have visibility on the $75 million RNG spend and expect Chiquita outlays to be lower in '27. Those two items alone move them above the current 41% to 42% free cash flow conversion and toward a more normalized 48% to 50%.
"we would encourage people to think of more normalized being 48% to 50%." — Mary Whitney (CFO)
PFAS treatment and on-site plants
Q (Trevor Romeo · William Blair): How proactive are you on PFAS treatment and what are economics of on-site plants versus sending leachate off-site?
A: They said the new Carolina treatment plant is an example of being proactive to rising POTW leachate costs related to PFAS and other requirements. They have deployed multiple internal mobile technologies to separate and solidify PFAS and then bury it, use some sites as hubs for third-party leachate, and view these as normal-course CapEx that reduce treatment cost relative to third parties.
"It is an example of rising leachate costs at POTW related to PFAS and other requirements that are being put on by state and federal regulators." — Ronald Mittelstaedt (CEO)
M&A pipeline and asset types
Q (Bhaven Shah · RBC): Can you describe the assets in your M&A pipeline and the cadence for the back half of the year?
A: They said cadence depends on seller timing and consents, and they expect an additional $30 million of exclusive franchises closing over the next few weeks plus more through Q3 and Q4 to reach an outsized year. The deals are typical solid waste singles and doubles, including collection, transfer, processing and sometimes disposal, with maybe 1 or 2 small E&P deals; nothing abnormal in the pipeline.
"These are all typical singles and doubles, Waste Connections, deals in solid waste." — Ronald Mittelstaedt (CEO)
rail opportunities and growth
Q (Tobey Sommer · Truist): How do you see rail integrating into the network near-term and longer-term?
A: They said rail remains geographic and concentrated in the upper northeastern seaboard where landfill capacity limits and higher tip fees make it economical. They grew Arrowhead's rail network effectively 300% over the last 2 years, are starting a Southeast (Florida) project that began mid- to late Q2 and will ramp in Q3, and view rail as a small but growing part of the business.
"Well, first off, as we've said for quite some time, rail is today a fairly geographic-centric modality that is being used predominantly off the upper northeastern seaboard due to both limitations of available landfill capacity and expansion and the economics of higher tip fees in that region." — Ronald Mittelstaedt (CEO)
core price vs yield spread drivers
Q (Aadit Shrestha · Stifel): Why did the core pricing yield spread change and is the recent level reasonable going forward?
A: They said sequential spread differences are largely due to mix — by line of business and geography — and churn. Management noted fuel surcharges likely increased churn and that their strategy targets markets where they can retain price, which affects yields; they would not generalize peer differences.
"So with respect to the sequential differences, I would attribute those to mix." — Mary Whitney (CFO)
Seneca Meadows expansion and airspace management
Q (Christina Johanna Bettink · BNP Paribas): Update on Seneca Meadows expansion permitting, timeline, and how you are managing airspace (rail or truck)?
A: They said they are managing airspace to serve customers until expansion permit and construction by moving some volumes out by rail and truck, including routing to Arrowhead. The permit process is moving well with recent legal victories and they expect final achievement closer to the end of this year, but said nothing is guaranteed because it is a technical and political process.
"We're moving some of our volumes out of Seneca down by rail through our network to Arrowhead and elsewhere to help manage those time lines." — Ronald Mittelstaedt (CEO)
rising interest rates and M&A impact
Q (Jonathan Windham · Union Bank of Switzerland): How do rising interest rates affect your funding advantage and M&A activity?
A: They said their balance sheet and access to low-cost capital is a differentiator and helps versus private players when rates rise, but higher rates can also slow the cyclical parts of the business. Management added that rising rates, tax changes, and the macro economy are three outside factors that influence private sellers' timing and thus external M&A activity.
"Look, we have always talked about there are at least 3 factors outside our control that help improve or decelerate external M&A from private companies." — Ronald Mittelstaedt (CEO)
undeveloped land purchase and RNG progress
Q (Noah Kaye · Oppenheimer): Why the $51 million purchase of undeveloped land and what incremental RNG contribution should we expect next year?
A: They said the $51 million was a strategic, opportunistic purchase for future facility development in an expensive Florida real estate market with limited options. On RNG, they said they are seeing about $15 million to $20 million more contribution this year than previously modeled, leaving the final third of contribution for next year with somewhat better margin impact as startup costs have been absorbed.
"episodically, we have the opportunity to buy something for future development." — Mary Whitney (CFO)
industry volume drivers and outlook
Q (Stephanie Benjamin Moore · Jefferies): How should we think about underlying volume growth for the industry given economic and other factors?
A: They said only two things drive underlying volume growth: GDP (nonfederal government spending) and population growth. Today population growth is near 0 and Q2 non-government spending was about 1.3%, so volumes are likely to be flat to modestly negative absent a macro change; public companies also avoid low-margin volume so flat volumes with improving margins can be acceptable.
"And that is true GDP spending nonfederal government spending in GDP and population growth." — Ronald Mittelstaedt (CEO)