Xylem posted a mixed but broadly positive Q1 report Tuesday morning, with earnings coming in ahead of expectations even as revenue narrowly missed.
$XYL Q1 2026 earnings: Steady Margins Mask a Stagnant Top Line
Xylem delivered a technically solid but uninspiring first quarter. Revenue and orders were completely flat organically (0% growth), absorbing the intentional headwinds from management's ongoing 80/20 portfolio…
— Finsee (@Finsee_main) April 28, 2026
The water technology company reported adjusted EPS of $1.12 for the first quarter, beating the Wall Street consensus of $1.09. That compares to $1.03 a year ago.
Revenue hit $2.1 billion, up 3% year over year on a reported basis. Organically — stripping out currency moves and acquisitions — revenue was flat. Analysts had expected $2.11 billion, so it was a slim miss on the top line.
New orders came in at $2.2 billion, up 3% year over year on a reported basis, though flat on an organic basis. Orders running ahead of revenue is generally a healthy sign for near-term demand.
Adjusted EBITDA margin expanded 20 basis points year over year to 20.6%. Xylem credited productivity savings and pricing gains, which offset inflation and softer volumes.
CEO Matthew Pine struck a measured tone. “We entered the year with sustained momentum and solid demand across key end markets,” he said. “While the external environment remains dynamic, our teams are executing well, staying close to customers, and advancing long-term priorities.”
Xylem nudged its full-year 2026 revenue outlook higher. The company now expects $9.2 billion to $9.3 billion, up from prior guidance of $9.1 billion to $9.2 billion. That represents 2% to 3% growth on a reported basis.
Full-year adjusted EPS guidance was held steady at $5.35 to $5.60. The midpoint of $5.48 sits just a hair below the analyst consensus of $5.49.
The company also expects full-year adjusted EBITDA margin of 22.9% to 23.3%, which would be an improvement of 70 to 110 basis points from 2025 results.
Jefferies analyst Stephen Volkmann described the quarter as “in line.” Not a ringing endorsement, but the market seemed to take it as good enough.
Xylem stock was up 1.6% in premarket trading, touching $125.50, even as broader futures pointed slightly lower.
Coming into Tuesday, XYL was down 9% year to date and up just 6% over the past 12 months. The stock dropped 8% after its Q4 report in February.
First quarter reported EPS came in at $0.79, up 14% from $0.69 in the same period last year.
The Q1 numbers at least stopped the bleeding for now.
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