Second-Quarter Highlights

Orders of $3.1 billion, up 42% on a reported basis and 41% organically
Revenue of $2.3 billion, up 2% on a reported basis and 1% organically
Earnings per share of $1.11, up 19%; $1.46 on an adjusted basis, up 16%

Xylem Inc. (NYSE:XYL), a leading global water solutions company dedicated to solving the world’s most challenging water issues, today reported second-quarter 2026 results. The Company delivered total revenue of $2.3 billion, on strong execution. Second-quarter earnings per share were up 19 percent on a reported basis and 16 percent on an adjusted basis.

"The demand drivers behind our business continue to strengthen," said Matthew Pine, Xylem’s CEO. "Water is becoming increasingly strategic for both utilities and industrial customers. We’ve spent the past several years positioning Xylem for this. Now we’re seeing that strategy create new opportunities and strengthen our competitive position. With a resilient municipal foundation, increasing exposure to attractive industrial markets and a more focused portfolio, we believe Xylem is well positioned for long-term growth and profitability."

"The opportunities we see today extend well beyond any single end market," Pine continued. "The growth of AI infrastructure is increasing the strategic importance of water across a broader industrial ecosystem from semiconductors and power generation to mining and other critical industries. At the same time, we are seeing increasing demand across sectors such as food and beverage and life sciences, where water quality, reliability and operational performance are essential. These trends are broadening our opportunity set and reinforcing our confidence in the durability of our long-term strategy."

Net income attributable to Xylem for the quarter was $263 million, or $1.11 per share. Net income margin increased 150 basis points to 11.3 percent. These results are driven by strong operational performance and lower restructuring and realignment costs, partially offset by increased income tax expense and loss on sale of businesses. Adjusted net income attributable to Xylem was $345 million, or $1.46 per share, which excludes purchase accounting intangible amortization, the loss on sale of businesses, restructuring and realignment costs, and special charges.

Second-quarter adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) margin was 23.3 percent, reflecting a year-over-year increase of 150 basis points. Productivity savings, strong price realization and mix drove the margin expansion, exceeding the impact of inflation and lower volumes.

Outlook

Xylem now forecasts full-year 2026 revenue of approximately $9.2 billion, up approximately 2 percent on a reported basis, versus 2 to 3 percent previously guided, and up approximately 2 to 3 percent on an organic basis, versus 2 to 4 percent previously guided.

Full-year 2026 adjusted EBITDA margin is expected to be approximately 23.1 to 23.5 percent, an increase of 90 to 130 basis points from Xylem’s 2025 adjusted results. This results in full-year adjusted earnings per share of $5.55 to $5.70, up from the previous guidance range of $5.35 to $5.60. Full-year free cash flow margin is still expected to be approximately 10.2 to 11.0 percent.

Further 2026 planning assumptions are included in Xylem’s second-quarter 2026 earnings materials posted at www.xylem.com/investors. Excluding revenue, Xylem provides guidance only on a non-GAAP basis due to the inherent difficulty in forecasting certain amounts that would be included in GAAP earnings, such as discrete tax items, without unreasonable effort.

Supplemental information on Xylem’s Second-quarter earnings, as well as definitions of and reconciliations for certain non-GAAP items is posted at www.xylem.com/investors.

About Xylem

Xylem (XYL) is a Fortune 500 global water solutions company that empowers customers and communities to build a more water-secure world. Our 22,000 employees delivered revenue of $9 billion in 2025, optimizing water and resource management with innovation and expertise. Join us at www.xylem.com and Let’s Solve Water.

Xylem uses our Investor Relations website, www.xylem.com/en-us/investors, as a means of disclosing information which may be of interest or material to our investors and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor our Investor Relations website, in addition to following our press releases, SEC filings, public conference calls, webcasts, and social media.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Generally, the words "anticipate," "estimate," "expect," "project," "intend," "plan," "contemplate," "predict," "forecast," "likely," "believe," "target," "goal," "objective," "will," "could," "would," "should," "potential," "may" and similar expressions or their negative, may, but are not necessary to, identify forward-looking statements. By their nature, forward-looking statements address uncertain matters and include any statements that: are not historical, such as statements about our strategy, financial plans, outlook, objectives, plans, intentions or goals (including those related to our social, environmental and other sustainability goals); or address possible or future results of operations or financial performance, including statements relating to orders, revenues, operating margins and earnings per share growth.

Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, many of which are beyond our control. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in or implied by our forward-looking statements include, among others, the following: the impact of overall industry and general economic conditions, including industrial, governmental, and public and private sector spending, interest rates, availability of funding for our customers, inflation and governments’ related monetary policy in response, and the strength of the real estate markets, on economic activity and our operations; geopolitical matters, including nationalism, protectionism and anti-global sentiment, volatility involving the U.S. and other governments, ongoing, escalation or outbreak of international conflicts, and regulatory, trade protection, economic and other risks associated with our global sales and operations; manufacturing and operating cost increases due to macroeconomic conditions, including inflation, energy supply, supply chain shortages, logistics challenges, labor shortages, trade agreements, tariffs, and other trade protection measures, and other factors; demand for our products, disruption, competition or pricing pressures in the markets we serve; cybersecurity incidents, data breaches, or other disruptions of information technology systems on which we or our customers rely, or involving our connected products and services; lack of availability or delays in receiving parts and raw materials from our supply chain, including semiconductors or other key components; operational disruptions at our facilities or that of third parties upon which we rely; safe and compliant treatment and handling of water, wastewater and hazardous materials; failure to successfully execute large projects, including as respects performance guarantees and customers’ budgets, timelines and safety requirements; our ability to retain, compete for and attract leadership, other key talent and labor; defects, security, warranty and liability claims, and recalls related to our products; uncertainty around productivity, simplification, restructuring and realignment actions and related costs and savings; our ability to execute strategic investments for growth, including acquisitions and divestitures; availability, regulation or interference with radio spectrum used by certain of our products; volatility in served markets or impacts on our business and operations due to weather conditions, volatile weather events, or changing climate patterns; risks related to our sustainability efforts and related disclosures; fluctuations in foreign currency exchange rates; difficulty predicting our financial results; risk of future impairments to goodwill and other intangible assets; changes in our effective tax rates or tax expenses; failure to comply with, or changes in, laws or regulations, pertaining to our business conduct, operations, products and services, including anti-corruption, artificial intelligence, data privacy and security, trade, competition, the environment, and health and safety; legal, governmental or regulatory claims, investigations or proceedings and associated contingent liabilities; matters related to intellectual property infringement or expiration of rights; and other factors set forth under "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025 and in subsequent filings we make with the Securities and Exchange Commission ("SEC").

Forward-looking and other statements in this press release regarding our environmental and other sustainability plans and goals are not an indication that these statements are necessarily material to investors, to our business, operating results, financial condition, outlook, or strategy, to our impacts on sustainability matters or other parties, or are required to be disclosed in our filings with the SEC or other regulatory authorities, and are not intended to create legal rights or obligations. In addition, historical, current, and forward-looking social, environmental and sustainability-related statements may be based on: standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.

All forward-looking statements made herein are based on information currently available to us as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

XYLEM INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENTS (Unaudited)
(in millions, except per share data)
	Three Months						Six Months
For the periods ended June 30,	2026			2025			2026			2025
Revenue from products	$	1,953		$	1,911		$	3,710		$	3,620
Revenue from services		383			390			751			750
Revenue		2,336			2,301			4,461			4,370
Cost of revenue from products		1,093			1,129			2,150			2,170
Cost of revenue from services		280			280			545			540
Cost of revenue		1,373			1,409			2,695			2,710
Gross profit		963			892			1,766			1,660
Selling, general and administrative expenses		503			503			975			963
Research and development expenses		59			58			115			114
Restructuring and asset impairment charges		11			26			42			47
Operating income		390			305			634			536
Interest expense		(7	)		(9	)		(11	)		(17	)
Other non-operating (expense)/income, net		(3	)		3			(3	)		7
Loss on sale of businesses		(16	)		—			(12	)		(10	)
Income before taxes		364			299			608			516
Income tax expense		(103	)		(75	)		(158	)		(125	)
Net income	$	261		$	224		$	450		$	391
Net loss attributable to non-controlling interests		2			2			6			4
Net income attributable to Xylem	$	263		$	226		$	456		$	395
Earnings per share:
Basic	$	1.11		$	0.93		$	1.90		$	1.62
Diluted	$	1.11		$	0.93		$	1.90		$	1.62
Weighted average number of shares:
Basic		236.3			243.4			239.5			243.3
Diluted		236.6			243.9			240.0			243.8

XYLEM INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions)
	June 30, 2026			December 31, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	1,276		$	1,479
Receivables, less allowances for discounts, returns and credit losses of $54 and $68 in 2026 and 2025, respectively		1,875			1,759
Inventories		1,016			983
Prepaid and other current assets		219			244
Assets held for sale		8			176
Total current assets		4,394			4,641
Property, plant and equipment, net		1,167			1,159
Goodwill		8,256			8,332
Other intangible assets, net		2,150			2,272
Other non-current assets		1,375			1,230
Total assets	$	17,342		$	17,634
LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,013		$	1,013
Accrued and other current liabilities		1,180			1,237
Short-term borrowings and current maturities of long-term debt		531			534
Liabilities held for sale		—			72
Total current liabilities		2,724			2,856
Long-term debt		2,395			1,408
Accrued post-retirement benefit obligations		301			317
Deferred income tax liabilities		446			405
Other non-current accrued liabilities		810			899
Total liabilities		6,676			5,885
Redeemable non-controlling interest		242			258
Stockholders’ equity:
Common stock – par value $0.01 per share:
Authorized 750.0 shares, issued 260.3 shares and 259.9 shares in 2026 and 2025, respectively		3			3
Capital in excess of par value		8,787			8,759
Retained earnings		3,956			3,706
Treasury stock – at cost 26.8 shares and 16.3 shares in 2026 and 2025, respectively		(2,023	)		(768	)
Accumulated other comprehensive loss		(302	)		(220	)
Total stockholders’ equity		10,421			11,480
Non-controlling interests		3			11
Total equity		10,424			11,491
Total liabilities, redeemable non-controlling interest, and stockholders’ equity	$	17,342		$	17,634

XYLEM INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in millions)
For the six months ended June 30,	2026			2025
Operating Activities
Net income	$	450		$	395
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		130			137
Amortization		150			153
Share-based compensation		25			25
Restructuring and asset impairment charges		42			47
Loss from sale of businesses		12			10
Other, net		(27	)		6
Payments for restructuring		(49	)		(36	)
Changes in assets and liabilities (net of acquisitions):
Changes in receivables		(142	)		(103	)
Changes in inventories		(41	)		(27	)
Changes in accrued expenses		(13	)		(64	)
Changes in accrued and deferred taxes		1			(50	)
Changes in long term receivables		(104	)		(70	)
Other, net		(36	)		(85	)
Net Cash – Operating activities		398			338
Investing Activities
Capital expenditures		(179	)		(169	)
Acquisitions of businesses, net of cash acquired		(1	)		(7	)
Proceeds from sale of businesses, net of cash disposed		59			50
Proceeds from the sale of property, plant and equipment		11			5
Cash paid for investments		(3	)		(3	)
Cash paid for asset acquisition		(2	)		(37	)
Cash received from cross-currency swaps		17			21
Net Cash – Investing activities		(98	)		(140	)
Financing Activities
Short-term debt issued, net		—			4
Long-term debt issued, net		990			—
Long-term debt repaid		(6	)		(28	)
Repurchase of common stock		(1,243	)		(13	)
Proceeds from exercise of employee stock options		2			8
Dividends paid		(207	)		(196	)
Other, net		(20	)		(19	)
Net Cash – Financing activities		(484	)		(244	)
Effect of exchange rate changes on cash		(31	)		84
Increase in cash classified within assets held for sale		—			11
Decrease in cash classified within assets held for sale		12			—
Changes in cash classified within assets held for sale		12			11
Net change in cash and cash equivalents		(203	)		49
Cash and cash equivalents at beginning of year		1,479			1,121
Cash and cash equivalents at end of period	$	1,276		$	1,170
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest	$	29		$	32
Income taxes (net of refunds received)	$	157		$	175

Xylem Inc. Non-GAAP Measures

Management reviews key performance indicators including revenue, gross margins, segment operating income and margins, orders growth, working capital and backlog, among others. In addition, we consider certain non-GAAP (or "adjusted") measures to be useful to management and investors evaluating our operating performance for the periods presented, and to provide a tool for evaluating our ongoing operations, liquidity and management of assets. This information can assist investors in assessing our financial performance and measures our ability to generate capital for deployment among competing strategic alternatives and initiatives, including but not limited to, dividends, acquisitions, share repurchases and debt repayment. Excluding revenue, Xylem provides guidance only on a non-GAAP basis due to the inherent difficulty in forecasting certain amounts that would be included in GAAP earnings, such as discrete tax items, without unreasonable effort. These adjusted metrics are consistent with how management views our business and are used to make financial, operating and planning decisions. These metrics, however, are not measures of financial performance under GAAP and should not be considered a substitute for revenue, operating income, net income, earnings per share (basic and diluted) or net cash from operating activities as determined in accordance with GAAP. We consider the following items to represent the non-GAAP measures that we consider to be key performance indicators, as well as the related reconciling items to the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

"Organic revenue" and "Organic orders" defined as revenue and orders, respectively, excluding the impact of fluctuations in foreign currency translation and contributions from acquisitions and divestitures. Divestitures include sales or discontinuance of insignificant portions of our business that did not meet the criteria for classification as a discontinued operation. The period-over-period change resulting from foreign currency translation impacts is determined by translating current period and prior period activity using the same currency conversion rate.

"EBITDA" defined as earnings before interest, taxes, depreciation and amortization expense. "Adjusted EBITDA" and "Adjusted Segment EBITDA" reflect the adjustments to EBITDA and segment EBITDA, respectively, to exclude share-based compensation charges, restructuring and realignment costs, gain or loss from sale of businesses and special charges.

"Adjusted EBITDA Margin" and "Adjusted Segment EBITDA Margin" defined as adjusted EBITDA and adjusted segment EBITDA divided by total revenue and segment revenue, respectively.

"Adjusted Operating Income", "Adjusted Segment Operating Income", "Adjusted Net Income" and "Adjusted EPS" defined as operating income, segment operating income, net income attributable to Xylem and earnings per share attributable to Xylem, adjusted to exclude restructuring and realignment costs, amortization of acquired intangible assets, gain or loss from sale of businesses, special charges and tax-related special items, as applicable.

"Adjusted Operating Margin" and "Adjusted Segment Operating Margin" defined as adjusted operating income and adjusted segment operating income divided by total revenue and segment revenue, respectively.

"Free Cash Flow" defined as net cash from operating activities, less capital expenditures, as reported in the Statement of Cash Flows. Our definition of free cash flow does not consider certain non-discretionary cash payments, such as debt.

"Free Cash Flow Margin" defined as free cash flow, adjusted (as applicable) for significant cash paid or received for non-operational tax, acquisition or divestiture activities; divided by revenue.

"Realignment costs" defined as costs not included in restructuring costs that are incurred as part of actions taken to reposition our business, including items such as professional fees, severance, relocation, travel, facility set-up and other costs.

"Special charges" defined as non-recurring costs incurred by the Company, such as those related to acquisitions and integrations, divestitures non-cash impairment charges and other special charges. In 2026, these charges include reductions of expense related to the refunds of certain tariffs previously imposed under the International, Emergency Economic Powers Act ("IEEPA").

"Tax-related special items" defined as tax items, such as tax return versus tax provision adjustments, tax exam impacts, tax law change impacts, excess tax benefits/losses and other discrete tax adjustments.

Xylem Inc. Non-GAAP Reconciliation
Reported vs. Organic Orders ($ Millions)

	(As Reported)								(As Adjusted - Organic)
		(A)	(B)						(C)		(D)	(E)		(F) = B+C+D+E		(G) = F/(A-D)
			Change		% Change				Acquisitions		Divestitures			Change		% Change
	Orders	Orders	2026 v. 2025		2026 v. 2025		Book-to-Bill		Acquisitions		Divestitures	FX Impact		Adj. 2026 v. 2025		Adj. 2026 v. 2025
	2026	2025
Six Months Ended June 30
Xylem Inc.	5,314	4,332	982		23	%	119	%	(27	)	28	(111	)	872		20	%
Water Infrastructure	1,344	1,298	46		4	%	105	%	(21	)	8	(45	)	(12	)	(1	%)
Applied Water	1,050	974	76		8	%	111	%	-		-	(20	)	56		6	%
Measurement and Control Solutions	905	839	66		8	%	89	%	-		20	(14	)	72		9	%
Water Solutions and Services	2,015	1,221	794		65	%	167	%	(6	)	-	(32	)	756		62	%

Quarter Ended June 30
Xylem Inc.	3,086	2,174	912		42	%	132	%	(15	)	23	(41	)	879		41	%
Water Infrastructure	669	672	(3	)	(0	%)	98	%	(13	)	3	(13	)	(26	)	(4	%)
Applied Water	538	488	50		10	%	107	%	-		-	(5	)	45		9	%
Measurement and Control Solutions	430	437	(7	)	(2	%)	85	%	-		20	(3	)	10		2	%
Water Solutions and Services	1,449	577	872		151	%	225	%	(2	)	-	(20	)	850		147	%

Quarter Ended March 31
Xylem Inc.	2,228	2,158	70		3	%	105	%	(12	)	5	(70	)	(7	)	(0	%)
Water Infrastructure	675	626	49		8	%	112	%	(8	)	5	(32	)	14		2	%
Applied Water	512	486	26		5	%	114	%	-		-	(15	)	11		2	%
Measurement and Control Solutions	475	402	73		18	%	94	%	-		-	(11	)	62		15	%
Water Solutions and Services	566	644	(78	)	(12	%)	100	%	(4	)	-	(12	)	(94	)	(15	%)

Xylem Inc. Non-GAAP Reconciliation
Reported vs. Organic Revenue ($ Millions)

	(As Reported - GAAP)						(As Adjusted - Organic)
		(A)	(B)				(C)		(D)	(E)		(F) = B+C+D+E		(G) = F/(A-D)
			Change		% Change		Acquisitions		Divestitures			Change		% Change
	Revenue	Revenue	2026 v. 2025		2026 v. 2025		Acquisitions		Divestitures	FX Impact		Adj. 2026 v. 2025		Adj. 2026 v. 2025
	2026	2025
Six Months Ended June 30
Xylem Inc.	4,461	4,370	91		2	%	(12	)	36	(94	)	21		0	%
Water Infrastructure	1,286	1,231	55		4	%	(7	)	7	(43	)	12		1	%
Applied Water	949	918	31		3	%	-		-	(19	)	12		1	%
Measurement and Control Solutions	1,016	1,030	(14	)	(1	%)	-		29	(15	)	-		0	%
Water Solutions and Services	1,210	1,191	19		2	%	(5	)	-	(17	)	(3	)	(0	%)

Quarter Ended June 30
Xylem Inc.	2,336	2,301	35		2	%	(7	)	31	(29	)	30		1	%
Water Infrastructure	683	650	33		5	%	(4	)	2	(14	)	17		3	%
Applied Water	501	483	18		4	%	-		-	(5	)	13		3	%
Measurement and Control Solutions	508	540	(32	)	(6	%)	-		29	(4	)	(7	)	(1	%)
Water Solutions and Services	644	628	16		3	%	(3	)	-	(6	)	7		1	%

Quarter Ended March 31
Xylem Inc.	2,125	2,069	56		3	%	(5	)	5	(65	)	(9	)	(0	%)
Water Infrastructure	603	581	22		4	%	(3	)	5	(29	)	(5	)	(1	%)
Applied Water	448	435	13		3	%	-		-	(14	)	(1	)	(0	%)
Measurement and Control Solutions	508	490	18		4	%	-		-	(11	)	7		1	%
Water Solutions and Services	566	563	3		1	%	(2	)	-	(11	)	(10	)	(2	%)

Xylem Inc. Non-GAAP Reconciliation
Adjusted Diluted EPS
($ Millions, except per share amounts)

		Q2 2026										Q2 2025
		As Reported			Adjustments				Adjusted			As Reported			Adjustments				Adjusted
	Total Revenue		2,336			-				2,336			2,301			-				2,301
	Operating Income		390			57		a		447			305			97		a		402
	Operating Margin		16.7	%						19.1	%		13.3	%						17.5	%
	Interest Expense		(7	)		-				(7	)		(9	)		-				(9	)
	Other Non-Operating Income (Expense)		(3	)		7		b		4			3			-		b		3
	Gain/(Loss) From Sale of Businesses		(16	)		16		c		-			-			-		c		-
	Income before Taxes		364			80				444			299			97				396
	Provision for Income Taxes		(103	)		2		d		(101	)		(75	)		(15	)	d		(90	)
	Net Income		261			82				343			224			82				306
	Net Loss Attributable to Non-controlling Interests		2			-				2			2			-				2
	Net Income Attributable to Xylem		263			82				345			226			82				308
	Diluted Shares		236.6							236.6			243.9							243.9
	Diluted EPS	$	1.11		$	0.35			$	1.46		$	0.93		$	0.33			$	1.26


		Q2 YTD 2026										Q2 YTD 2025
		As Reported			Adjustments				Adjusted			As Reported			Adjustments				Adjusted
	Total Revenue		4,461			-				4,461			4,370			-				4,370
	Operating Income		634			155		a		789			536			191		a		727
	Operating Margin		14.2	%						17.7	%		12.3	%						16.6	%
	Interest Expense		(11	)		-				(11	)		(17	)		-				(17	)
	Other Non-Operating Income (Expense)		(3	)		12		b		9			7			-		b		7
	Gain/(Loss) From Sale of Businesses		(12	)		12		c		-			(10	)		10		c		-
	Income before Taxes		608			179				787			516			201				717
	Provision for Income Taxes		(158	)		(18	)	d		(176	)		(125	)		(37	)	d		(162	)
	Net Income		450			161				611			391			164				555
	Net Loss Attributable to Non-controlling Interests		6			-				6			4			-				4
	Net Income Attributable to Xylem		456			161				617			395			164				559
	Diluted Shares		240.0							240.0			243.8							243.8
	Diluted EPS	$	1.90		$	0.67			$	2.57		$	1.62		$	0.67			$	2.29

a	Quarter-to-date:
	Restructuring & realignment costs: 2026 - $15 million; 2025 - $29 million
	Special charges: 2026 - $6 million of acquisition, divestiture & integration costs, offset by $16 million of IEEPA tariff refunds ; 2025 - $9 million of acquisition, divestiture & integration costs and $4 million of intangible asset impairment charges
	Purchase accounting intangible amortization: 2026 - $52 million; 2025 - $55 million
	Year-to-date:
	Restructuring & realignment costs: 2026 - $53 million and 2025 - $56 million
	Special charges: 2026 - $11 million of acquisition, divestiture & integration costs, offset by $16 million of IEEPA tariff refunds; 2025 - $17 million of acquisition & integration related costs and $8 million of intangible asset impairment charges
	Purchase accounting intangible amortization: 2026 - $107 million and 2025 - $110 million
b	Other special charges
c	Gain/(Loss) from sale of businesses as per income statement for all periods presented
d	Quarter-to-date: 2026 - Net tax impact on pre-tax adjustments (notes a, b and c) of $13 million, offset by $15 million of other tax special expense items; 2025 - Net tax impact on pre-tax adjustments (note a, b and c) of $20 million, offset by $5 million of other tax special expense items;
	Year-to-date: 2026 - Net tax impact on pre-tax adjustments (notes a, b and c) of $34 million, offset by $16 million of other tax special expense items; 2025 - Net tax impact on pre-tax adjustments (note a, b and c) of $42 million, offset by other tax special expense items of $5 million;

Xylem Inc. Non-GAAP Reconciliation
EBITDA and Adjusted EBITDA by Quarter ($ Millions)

2026
	Q1		Q2		Q3		Q4		Total

Net Income attributable to Xylem	193		263						456
Net Income margin	9.1	%	11.3	%					10.2	%
Depreciation	65		65						130
Amortization	75		75						150
Interest Expense (Income), net	(4	)	2						(2	)
Income Tax Expense	55		103						158
EBITDA	384		508						892
Share-based Compensation	13		12						25
Restructuring & Realignment	38		13						51
Special Charges	10		(3	)					7
Loss/(Gain) from sale of businesses	(4	)	16						12
Loss attributable to non-controlling interests	(4	)	(2	)					(6	)
Adjusted EBITDA	437		544						981
Revenue	2,125		2,336						4,461
Adjusted EBITDA Margin	20.6	%	23.3	%					22.0	%

2025
	Q1		Q2		Q3		Q4		Total

Net Income attributable to Xylem	169		226		227		335		957
Net Income margin	8.2	%	9.8	%	10.0	%	14.0	%	10.6	%
Depreciation	68		69		64		66		267
Amortization	77		76		78		77		308
Interest Expense (Income), net	-		3		-		(1	)	2
Income Tax Expense	50		75		71		35		231
EBITDA	364		449		440		512		1,765
Share-based Compensation	12		13		12		16		53
Restructuring & Realignment	27		29		30		45		131
Special Charges	12		13		9		2		36
Loss/(Gain) from sale of businesses	10		-		37		(16	)	31
Loss attributable to non-controlling interests	(2	)	(2	)	(1	)	(2	)	(7	)
Adjusted EBITDA	423		502		527		557		2,009
Revenue	2,069		2,301		2,268		2,397		9,035
Adjusted EBITDA Margin	20.4	%	21.8	%	23.2	%	23.2	%	22.2	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20260724514415/en/

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