UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended June 30, 2024
or
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from to
Commission file number 1-12154

Waste Management, Inc.

(Exact name of registrant as specified in its charter)

Delaware	73-1309529
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

800 Capitol Street

Suite 3000

Houston, Texas 77002

(Address of principal executive offices)

(713) 512-6200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $0.01 par value	WM	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☑  No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☑  No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☑	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☐
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ☐  No  ☑

The number of shares of Common Stock, $0.01 par value, of the registrant outstanding at July 22, 2024 was 401,314,827 (excluding treasury shares of 228,967,634).

PART I.

Item 1.    Financial Statements.

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Millions, Except Share and Par Value Amounts)

	June 30,		December 31,
	2024		2023
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	172	$	458
Accounts receivable, net of allowance for doubtful accounts of $29 and $30, respectively		2,728		2,633
Other receivables, net of allowance for doubtful accounts of $4 and $4, respectively		252		237
Parts and supplies		183		173
Other current assets		1,104		303
Total current assets		4,439		3,804
Property and equipment, net of accumulated depreciation and depletion of $23,310 and $22,826, respectively		17,420		16,968
Goodwill		9,363		9,254
Other intangible assets, net		753		759
Restricted funds		465		422
Investments in unconsolidated entities		552		606
Other long-term assets		1,007		1,010
Total assets	$	33,999	$	32,823
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	1,785	$	1,709
Accrued liabilities		1,525		1,605
Deferred revenues		584		578
Current portion of long-term debt		242		334
Total current liabilities		4,136		4,226
Long-term debt, less current portion		16,501		15,895
Deferred income taxes		1,826		1,826
Landfill and environmental remediation liabilities		2,936		2,888
Other long-term liabilities		1,149		1,092
Total liabilities		26,548		25,927
Commitments and contingencies (Note 6)
Equity:
Waste Management, Inc. stockholders’ equity:
Common stock, $0.01 par value; 1,500,000,000 shares authorized; 630,282,461 shares issued		6		6
Additional paid-in capital		5,433		5,351
Retained earnings		15,104		14,334
Accumulated other comprehensive (loss) income		(73)		(37)
Treasury stock at cost, 229,183,391 and 228,827,218 shares, respectively		(13,013)		(12,751)
Total Waste Management, Inc. stockholders’ equity		7,457		6,903
Noncontrolling interests		(6)		(7)
Total equity		7,451		6,896
Total liabilities and equity	$	33,999	$	32,823

See Notes to Condensed Consolidated Financial Statements.

2

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Millions, Except per Share Amounts)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Operating revenues	$	5,402	$	5,119	$	10,561	$	10,011
Costs and expenses:
Operating		3,291		3,186		6,431		6,272
Selling, general and administrative		501		467		992		943
Depreciation, depletion and amortization		543		521		1,057		1,026
Restructuring		—		1		—		4
(Gain) loss from divestitures, asset impairments and unusual items, net		58		—		56		(3)
		4,393		4,175		8,536		8,242
Income from operations		1,009		944		2,025		1,769
Other income (expense):
Interest expense, net		(136)		(125)		(266)		(245)
Equity in net income (losses) of unconsolidated entities		22		(12)		3		(23)
Other, net		(1)		2		1		4
		(115)		(135)		(262)		(264)
Income before income taxes		894		809		1,763		1,505
Income tax expense		214		196		376		360
Consolidated net income		680		613		1,387		1,145
Less: Net income (loss) attributable to noncontrolling interests		—		(2)		(1)		(3)
Net income attributable to Waste Management, Inc.	$	680	$	615	$	1,388	$	1,148
Basic earnings per common share	$	1.70	$	1.52	$	3.46	$	2.82
Diluted earnings per common share	$	1.69	$	1.51	$	3.44	$	2.81

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Millions)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Consolidated net income	$	680	$	613	$	1,387	$	1,145
Other comprehensive income (loss), net of tax:
Derivative instruments, net		(1)		6		(1)		11
Available-for-sale securities, net		(1)		—		—		5
Foreign currency translation adjustments		(10)		20		(34)		22
Post-retirement benefit obligations, net		(1)		(1)		(1)		(1)
Other comprehensive income (loss), net of tax		(13)		25		(36)		37
Comprehensive income		667		638		1,351		1,182
Less: Comprehensive income (loss) attributable to noncontrolling interests		—		(2)		(1)		(3)
Comprehensive income attributable to Waste Management, Inc.	$	667	$	640	$	1,352	$	1,185

See Notes to Condensed Consolidated Financial Statements.

3

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions)

(Unaudited)

	Six Months Ended
	June 30,
	2024		2023
Cash flows from operating activities:
Consolidated net income	$	1,387	$	1,145
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation, depletion and amortization		1,057		1,026
Deferred income tax expense (benefit)		14		31
Interest accretion on landfill and environmental remediation liabilities		66		65
Provision for bad debts		26		20
Equity-based compensation expense		57		47
Net gain on disposal of assets		(50)		(20)
(Gain) loss from divestitures, asset impairments and other, net		56		(3)
Equity in net (income) losses of unconsolidated entities, net of dividends		(3)		23
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Receivables		(127)		(105)
Other current assets		(30)		(29)
Other assets		63		43
Accounts payable and accrued liabilities		85		(22)
Deferred revenues and other liabilities		(80)		(147)
Net cash provided by operating activities		2,521		2,074
Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired		(243)		(118)
Capital expenditures		(1,335)		(1,180)
Proceeds from divestitures of businesses and other assets, net of cash divested		58		46
Other, net		(839)		(87)
Net cash used in investing activities		(2,359)		(1,339)
Cash flows from financing activities:
New borrowings		9,180		11,356
Debt repayments		(8,752)		(11,074)
Common stock repurchase program		(262)		(620)
Cash dividends		(608)		(572)
Exercise of common stock options		36		25
Tax payments associated with equity-based compensation transactions		(48)		(28)
Other, net		(10)		(6)
Net cash used in financing activities		(464)		(919)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents		(4)		2
(Decrease) increase in cash, cash equivalents and restricted cash and cash equivalents		(306)		(182)
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period		552		445
Cash, cash equivalents and restricted cash and cash equivalents at end of period	$	246	$	263
Reconciliation of cash, cash equivalents and restricted cash and cash equivalents at end of period:
Cash and cash equivalents	$	172	$	144
Restricted cash and cash equivalents included in other current assets		4		43
Restricted cash and cash equivalents included in restricted funds		70		76
Cash, cash equivalents and restricted cash and cash equivalents at end of period	$	246	$	263

See Notes to Condensed Consolidated Financial Statements.

4

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In Millions, Except Shares in Thousands)

(Unaudited)

			Waste Management, Inc. Stockholders’ Equity
										Accumulated
						Additional				Other
			Common Stock			Paid-In		Retained		Comprehensive		Treasury Stock			Noncontrolling
	Total		Shares	Amounts		Capital		Earnings		(Loss) Income		Shares	Amounts		Interests
Three Months Ended June 30:
2024
Balance, March 31, 2024	$	7,078	630,282	$	6	$	5,352	$	14,738	$	(60)	(228,980)	$	(12,954)	$	(4)
Consolidated net income		680	—		—		—		680		—	—		—		—
Other comprehensive income (loss), net of tax		(13)	—		—		—		—		(13)	—		—		—
Cash dividends declared of $0.75 per common share		(301)	—		—		—		(301)		—	—		—		—
Equity-based compensation transactions, net		31	—		—		29		(1)		—	62		3		—
Common stock repurchase program		(12)	—		—		50		—		—	(266)		(62)		—
Adoption of new accounting standard		(12)	—		—		—		(12)		—	—		—		—
Other, net		—	—		—		2		—		—	1		—		(2)
Balance, June 30, 2024	$	7,451	630,282	$	6	$	5,433	$	15,104	$	(73)	(229,183)	$	(13,013)	$	(6)
2023
Balance, March 31, 2023	$	6,808	630,282	$	6	$	5,244	$	13,414	$	(57)	(223,491)	$	(11,813)	$	14
Consolidated net income		613	—		—		—		615		—	—		—		(2)
Other comprehensive income (loss), net of tax		25	—		—		—		—		25	—		—		—
Cash dividends declared of $0.70 per common share		(283)	—		—		—		(283)		—	—		—		—
Equity-based compensation transactions, net		33	—		—		27		(2)		—	157		8		—
Common stock repurchase program		(275)	—		—		70		—		—	(2,074)		(345)		—
Other, net		7	—		—		—		—		—	1		—		7
Balance, June 30, 2023	$	6,928	630,282	$	6	$	5,341	$	13,744	$	(32)	(225,407)	$	(12,150)	$	19

See Notes to Condensed Consolidated Financial Statements.

5

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ─ (Continued)

(In Millions, Except Shares in Thousands)

(Unaudited)

			Waste Management, Inc. Stockholders’ Equity
										Accumulated
						Additional				Other
			Common Stock			Paid-In		Retained		Comprehensive		Treasury Stock			Noncontrolling
	Total		Shares	Amounts		Capital		Earnings		(Loss) Income		Shares	Amounts		Interests
Six Months Ended June 30:
2024
Balance, December 31, 2023	$	6,896	630,282	$	6	$	5,351	$	14,334	$	(37)	(228,827)	$	(12,751)	$	(7)
Consolidated net income		1,387	—		—		—		1,388		—	—		—		(1)
Other comprehensive income (loss), net of tax		(36)	—		—		—		—		(36)	—		—		—
Cash dividends declared of $1.50 per common share		(608)	—		—		—		(608)		—	—		—		—
Equity-based compensation transactions, net		82	—		—		17		2		—	1,137		63		—
Common stock repurchase program		(265)	—		—		60		—		—	(1,494)		(325)		—
Adoption of new accounting standard		(12)							(12)
Other, net		7	—		—		5		—		—	1		—		2
Balance, June 30, 2024	$	7,451	630,282	$	6	$	5,433	$	15,104	$	(73)	(229,183)	$	(13,013)	$	(6)
2023
Balance, December 31, 2022	$	6,864	630,282	$	6	$	5,314	$	13,167	$	(69)	(222,396)	$	(11,569)	$	15
Consolidated net income		1,145	—		—		—		1,148		—	—		—		(3)
Other comprehensive income (loss), net of tax		37	—		—		—		—		37	—		—		—
Cash dividends declared of $1.40 per common share		(572)	—		—		—		(572)		—	—		—		—
Equity-based compensation transactions, net		75	—		—		27		1		—	923		47		—
Common stock repurchase program		(628)	—		—		—		—		—	(3,936)		(628)		—
Other, net		7	—		—		—		—		—	2		—		7
Balance, June 30, 2023	$	6,928	630,282	$	6	$	5,341	$	13,744	$	(32)	(225,407)	$	(12,150)	$	19

See Notes to Condensed Consolidated Financial Statements.

6

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.    Basis of Presentation

The financial statements presented in this report represent the consolidation of Waste Management, Inc., a Delaware corporation; its wholly-owned and majority-owned subsidiaries; and certain variable interest entities for which Waste Management, Inc. or its subsidiaries are the primary beneficiaries as described in Note 13. Waste Management, Inc. is a holding company and all operations are conducted by its subsidiaries. When the terms “the Company,” “we,” “us” or “our” are used in this document, those terms refer to Waste Management, Inc., together with its consolidated subsidiaries and consolidated variable interest entities. When we use the term “WMI,” we are referring only to Waste Management, Inc., the parent holding company.

We are North America’s leading provider of comprehensive environmental solutions, providing services throughout the United States (“U.S.”) and Canada. We partner with our customers and the communities we serve to manage and reduce waste at each stage from collection to disposal, while recovering valuable resources and creating clean, renewable energy. Our business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, and recycling and resource recovery services. Through our subsidiaries, including our Waste Management Renewable Energy (“WM Renewable Energy”) business, we are also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S. and Canada that produce renewable electricity and renewable natural gas (“RNG”), which is a significant source of fuel that we allocate to our natural gas fleet.

Our senior management evaluates, oversees and manages the financial performance of our business through four reportable segments, referred to as (i) Collection and Disposal - East Tier (“East Tier”); (ii) Collection and Disposal - West Tier (“West Tier”); (iii) Recycling Processing and Sales and (iv) WM Renewable Energy. Our East and West Tier, along with certain ancillary services (“Other Ancillary”) not managed through our 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. Refer to Note 7 for further discussion.

The Condensed Consolidated Financial Statements as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows, and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.

In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with precision from available data or simply cannot be calculated. In some cases, these estimates are difficult to determine, and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, long-lived asset impairments, intangible asset impairments and the fair value of assets and liabilities acquired in business combinations. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements.

Revenue Recognition

We generally recognize revenue as services are performed or products are delivered. For example, revenue typically is recognized as waste is collected, tons are received at our landfills or transfer stations, or recycling and other commodities,

7

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

such as RNG, electricity and capacity, Renewable Identification Numbers (“RINs”) and Renewable Energy Credits (“RECs”), are sold.

We also bill for certain services prior to performance. Such services include, among others, certain commercial and residential contracts, and equipment rentals. These advanced billings are included in deferred revenues and recognized as revenue in the period service is provided. Substantially all our deferred revenues during the reported periods are realized as revenues within one to three months, when the related services are performed.

Contract Acquisition Costs

Our incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are generally deferred and amortized to selling, general and administrative expense over the estimated life of the relevant customer relationship, ranging from five to 13 years. Contract acquisition costs that are paid to the customer are deferred and amortized as a reduction in revenue over the contract life. Our contract acquisition costs are classified as current or noncurrent based on the timing of when we expect to recognize amortization and are included in other assets in our Condensed Consolidated Balance Sheets. As of June 30, 2024 and December 31, 2023, we had $217 million and $207 million, respectively, of deferred contract costs, of which $151 million and $148 million, respectively, were related to deferred sales incentives.

Leases

Amounts for our operating lease right-of-use assets are recorded in long-term other assets and the current and long-term portion of our operating lease liabilities are reflected in accrued liabilities and other long-term liabilities, respectively, in our Condensed Consolidated Balance Sheets. Amounts for our financing leases are recorded in property and equipment, net of accumulated depreciation and depletion, and current or long-term debt in our Condensed Consolidated Balance Sheets, as appropriate.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments held within restricted funds, and accounts receivable. We make efforts to control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with a diverse group of credit-worthy financial institutions; (ii) holding high-quality financial instruments while limiting investments in any one instrument and (iii) maintaining strict policies over credit extension that include credit evaluations, credit limits and monitoring procedures, although generally we do not have collateral requirements for credit extensions. We also control our exposure associated with trade receivables by discontinuing service, to the extent allowable, to non-paying customers. However, our overall credit risk associated with trade receivables is limited due to the large number and diversity of customers we serve.

Other Current Assets

As of June 30, 2024, other current assets included $778 million of investments in certain WM tax-exempt bonds. We purchased these bonds because they were subject to mandatory scheduled remarketings during a period of time that we determined that we were unable to remarket the bonds to third-party investors because we were in possession of material non-public information about the pending announcement of our planned acquisition of Stericycle, Inc. (“Stericycle”). These investments are classified as current because we have the intent and ability to remarket the bonds within the next twelve months. The related tax-exempt debt is included in our Condensed Consolidated Balance Sheet as of June 30, 2024 as a component of long-term debt. In July 2024 we received $349 million from the successful remarketing of these tax-exempt bonds and expect to successfully remarket the remaining bonds held within the third quarter of 2024.

8

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Reclassifications

When necessary, reclassifications have been made to our prior period financial information to conform to the current year presentation and are not material to our Condensed Consolidated Financial Statements.

2.    Landfill and Environmental Remediation Liabilities

Liabilities for landfill and environmental remediation costs are presented in the table below (in millions):

June 30, 2024			December 31, 2023
	Environmental			Environmental
Landfill	Remediation	Total	Landfill	Remediation	Total