Segment and Related Information

3 Months Ended

Mar. 31, 2024

Segment and Related Information

Segment and Related Information

7.    Segment and Related Information

Our senior management evaluates, oversees and manages the financial performance of our business through four reportable segments, referred to as (i) East Tier; (ii) West Tier; (iii) Recycling Processing and Sales and (iv) WM Renewable Energy. Our East Tier and West Tier, combined with certain “Other Ancillary” services that are not managed through the Tier segments, but that support our collection and disposal operations, form our Collection and Disposal businesses. We also provide additional services not managed through our four reportable segments, which are presented as Corporate and Other.

Summarized financial information concerning our reportable segments for the three months ended March 31 is shown in the following table (in millions):

	Gross		Intercompany		Net		Income
	Operating		Operating		Operating		from
	Revenues		Revenues(a)		Revenues		Operations(b)
2024
Collection and Disposal:
East Tier	$	2,616	$	(535)	$	2,081	$	654
West Tier		2,497		(504)		1,993		627
Other Ancillary		686		(44)		642		(2)
Collection and Disposal		5,799		(1,083)		4,716		1,279
Recycling Processing and Sales		436		(68)		368		19
WM Renewable Energy		70		(1)		69		21
Corporate and Other		12		(6)		6		(303)
Total	$	6,317	$	(1,158)	$	5,159	$	1,016
2023
Collection and Disposal:
East Tier	$	2,561	$	(516)	$	2,045	$	531
West Tier		2,392		(495)		1,897		531
Other Ancillary		625		(44)		581		2
Collection and Disposal		5,578		(1,055)		4,523		1,064
Recycling Processing and Sales		374		(80)		294		13
WM Renewable Energy		70		(1)		69		20
Corporate and Other		12		(6)		6		(272)
Total	$	6,034	$	(1,142)	$	4,892	$	825

(a) Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service.

(b) For those items included in the determination of income from operations, the accounting policies of the segments are the same as those described in Note 1.

The mix of operating revenues from our major lines of business for the three months ended March 31 are as follows (in millions):

	Gross		Intercompany		Net
	Operating		Operating		Operating
	Revenues		Revenues		Revenues
2024
Commercial	$	1,501	$	(185)	$	1,316
Industrial		934		(187)		747
Residential		876		(22)		854
Other collection		751		(53)		698
Total collection		4,062		(447)		3,615
Landfill		1,177		(385)		792
Transfer		560		(251)		309
Total Collection and Disposal		5,799		(1,083)		4,716
Recycling Processing and Sales		436		(68)		368
WM Renewable Energy		70		(1)		69
Corporate and Other		12		(6)		6
Total	$	6,317	$	(1,158)	$	5,159
2023
Commercial	$	1,412	$	(161)	$	1,251
Industrial		933		(177)		756
Residential		854		(25)		829
Other collection		689		(50)		639
Total collection		3,888		(413)		3,475
Landfill		1,150		(391)		759
Transfer		540		(251)		289
Total Collection and Disposal		5,578		(1,055)		4,523
Recycling Processing and Sales		374		(80)		294
WM Renewable Energy		70		(1)		69
Corporate and Other		12		(6)		6
Total	$	6,034	$	(1,142)	$	4,892

Our financial and operating results may fluctuate for many reasons, including period-to-period changes in the relative contribution of revenue by each line of business, changes in commodity prices and general economic conditions. Our operating revenues and volumes typically experience seasonal increases in the summer months that are reflected in second and third quarter revenues and results of operations.

Service or operational disruptions caused by severe storms, extended periods of inclement weather or climate events can significantly affect the operating results of the geographic areas affected. Extreme weather events may also lead to supply chain disruption and delayed project development, or disruption of our customers’ businesses, reducing the amount of waste generated by their operations.

Conversely, certain destructive weather and climate conditions, such as wildfires in the Western U.S. and hurricanes that most often impact our operations in the Southern and Eastern U.S. during the second half of the year, can increase our revenues in the geographic areas affected as a result of the waste volumes generated by these events. While weather-related and other event-driven special projects can boost revenues through additional work for a limited time, due to significant start-up costs and other factors, such revenue can generate earnings at comparatively lower margins.