Waste Connections Projects Mid-Single-Digit Revenue Growth in 2026 Amid M&A and Tech Expansion

Key Highlights from Waste Connections’ Q3 2025 Earnings Call

Waste Connections, Inc. (WCN) delivered a strong third-quarter performance in 2025, exceeding expectations with improved financial results driven by superior execution and operational improvements. The company’s leadership emphasized continued progress in several key areas, including employee retention, safety incident rates, and pricing strategies.

Ronald Mittelstaedt, Founder, CEO, President & Director, highlighted that the company’s adjusted EBITDA margins reached 33.8%, reflecting an underlying solid waste margin expansion of approximately 80 basis points. He attributed this to better-than-expected operating trends, lower employee turnover, and improved safety performance. Mittelstaedt also noted that the company remains well-positioned to meet its full-year 2025 outlook, as previously outlined in July.

The CEO also announced an 11.1% increase in the regular quarterly cash dividend and the repurchase of approximately 2.4 million shares, or nearly 1% of outstanding shares. This reflects the company’s commitment to returning value to shareholders while maintaining a strong balance sheet.

Mittelstaedt further emphasized the strategic use of technology to enhance productivity, efficiency, and customer experience. He expressed excitement about the benefits of these investments, which are aimed at accelerating leadership capabilities and expanding the company’s reach.

Mary Whitney, Executive Vice President & CFO, provided additional details on the financial performance. Revenue for the quarter reached $2.458 billion, surpassing expectations and representing a 5.1% year-over-year increase. Adjusted EBITDA for Q3 was $830.3 million, up 5.4% year-over-year and slightly above projections.

Acquisition Activity and Strategic Growth

Waste Connections continued its acquisition momentum, with approximately $300 million in annualized revenues from deals either closed or under definitive agreement year-to-date. The company expects more acquisitions to close in Q4 and into early 2026. This ongoing M&A activity is expected to contribute to future revenue growth.

Mittelstaedt welcomed Jason Craft as the new Chief Operating Officer, describing him as a seasoned leader with extensive experience in local, divisional, and regional operations. This appointment underscores the company’s focus on strong internal leadership and operational continuity.

Outlook for 2025 and Beyond

Management reaffirmed its full-year 2025 guidance, with Whitney stating that assuming continued trends and no further headwinds, Q4 revenue is expected to be approximately $2.36 billion. Adjusted EBITDA margins are projected to rise by about 90 basis points year-over-year to around 33.3%.

For 2026, Mittelstaedt outlined a high-level framework, anticipating mid-single-digit revenue growth driven by price-led organic growth in the solid waste segment. He also noted that approximately 1% of revenue will come from 2025 acquisition activity, partially offset by ongoing commodity-related headwinds.

Despite these challenges, the company remains confident in its ability to achieve above-average underlying solid waste margin expansion. However, it acknowledges potential margin dilution from acquisitions and commodity impacts.

Financial Performance and Operational Metrics

Whitney reported that core pricing in Q3 reached 6.3%, putting the company on track for a full-year core pricing of approximately 6.5%, which exceeds initial 2025 expectations. Volumes declined by 2.7%, but landfill tons increased by almost 3%, and special waste tons rose by 10%.

Recycling and landfill gas revenues fell by 27% year-over-year due to lower pricing. Adjusted EBITDA margin stood at 33.8%, up 10 basis points year-over-year, despite a 20 basis point drag from commodities.

Year-to-date, adjusted free cash flow reached $1.084 billion, with capital expenditures increasing by over $135 million compared to the same period last year. This supports the company’s full-year adjusted free cash flow outlook of $1.3 billion.

Analyst Questions and Management Responses

During the Q&A session, analysts raised questions on various topics, including E&P business performance, new RNG investments, pricing tools, Chiquita remediation costs, volume growth, and risk management costs.

Whitney explained that the Canadian business saw a sequential increase, primarily due to a remediation job, and suggested excluding $10 million for run-rate purposes. She also noted that incremental benefits from new RNG investments would likely begin in 2027.

Regarding pricing tools, Whitney highlighted improved pricing retention linked to new systems and higher employee retention, suggesting that less price pressure may be needed in 2026 than in 2025.

Mittelstaedt provided updates on Chiquita remediation costs, noting improvements in leachate management without material changes to total outlay. He also addressed concerns about commodity headwinds and litigation risks, particularly related to the Chiquita Canyon landfill.

Sentiment and Market Positioning

Analysts generally maintained a neutral tone, though they focused on specific issues such as E&P performance, Chiquita costs, and margin impacts. Management remained confident during prepared remarks, emphasizing operational execution, margin expansion, and technology investments.

Compared to the previous quarter, the tone remained consistent, with greater emphasis on technology’s positive impact and M&A activity. Analysts continue to monitor cost and volume trends closely.

Quarter-over-Quarter Comparison

Q3 guidance and margin expansion language remained similar to Q2, but commentary around pricing retention and technology’s impact showed improvement. Management highlighted stronger acquisition activity and the new COO appointment, while the previous quarter focused on transitions and the COO’s retirement.

Key metrics like core pricing and margin expansion improved sequentially. Special waste activity and landfill volume trends showed slight improvement compared to Q2. Analysts shifted their focus from macroeconomic uncertainties and Chiquita costs in Q2 to pricing tools, M&A, and technological initiatives in Q3.

Risks and Concerns

Management identified ongoing commodity-related headwinds and litigation risks, particularly concerning the Chiquita Canyon landfill. Mittelstaedt noted that outlays are running ahead of expectations due to accelerated steps in leachate treatment activities.

Analysts raised concerns about volume visibility, commodity prices, and risk management cost reductions lagging expectations. Whitney acknowledged that risk management costs continue to be a headwind of 20 to 30 basis points in the quarter.

Final Takeaway

Waste Connections delivered strong third-quarter results, supported by margin expansion, disciplined pricing, and robust acquisition activity. The company reaffirmed its 2025 outlook, signaled mid-single-digit revenue growth for 2026, and highlighted the positive impact of technology investments and improved employee retention.

While commodity headwinds and litigation remain challenges, continued operational execution and strategic flexibility position the company for sustained long-term growth.