Xylem Inc. (XYL) Income Statement

17Y historyFree accessUpdated daily

Gross margin has improved to 41.2% in 2026Q2 from 37.1% in 2025Q1 (+410 bps) even as revenue growth decelerated from 26.0% in 2024Q2 to 1.5% in 2026Q2, indicating the 80/20 program is favoring mix and operating leverage over volume.

Annual statement

XYL Income Statement

Xylem Inc. (XYL) annual income statement — 17-year revenue, gross profit & net income history

Annual Quarterly

Metric	TTM	Dec'25	Dec'24	Dec'23	Dec'22	Dec'21	Dec'20	Dec'19	Dec'18	Dec'17	Dec'16	Dec'15	Dec'14	Dec'13	Dec'12	Dec'11	Dec'10	Dec'09

Sales/Revenue	9.06B	9.04B	8.56B	7.36B	5.52B	5.2B	4.88B	5.25B	5.21B	4.71B	3.77B	3.65B	3.92B	3.84B	3.79B	3.8B	3.2B	2.85B
Revenue Growth %	1.86%	5.52%	16.27%	33.36%	6.29%	6.54%	-7.11%	0.81%	10.62%	24.82%	3.23%	-6.72%	2.06%	1.21%	-0.32%	18.77%	12.39%	-
Cost of Goods Sold	5.45B	5.56B	5.35B	4.65B	3.44B	3.22B	3.05B	3.2B	3.18B	2.86B	2.31B	2.25B	2.4B	2.34B	2.29B	2.34B	1.99B	1.81B
COGS % of Revenue	-	61.54%	62.49%	63.1%	62.26%	61.98%	62.47%	61.02%	61.09%	60.68%	61.26%	61.57%	61.36%	60.93%	60.38%	61.58%	62.09%	63.6%
Gross Profit	3.6B	3.48B	3.21B	2.72B	2.08B	1.98B	1.83B	2.05B	2.03B	1.85B	1.46B	1.4B	1.51B	1.5B	1.5B	1.46B	1.21B	1.04B
Gross Margin %	39.79%	38.46%	37.51%	36.9%	37.74%	38.02%	37.53%	38.98%	38.91%	39.32%	38.74%	38.43%	38.64%	39.07%	39.62%	38.42%	37.91%	36.4%
Gross Profit Growth %	-	8.19%	18.22%	30.37%	5.52%	7.92%	-10.56%	0.99%	9.45%	26.69%	4.06%	-7.2%	0.93%	-0.2%	2.81%	20.35%	17.07%	-
Operating Expenses	2.23B	2.25B	2.2B	2.06B	1.46B	1.39B	1.46B	1.56B	1.37B	1.29B	1.05B	955M	1.05B	1.14B	1.06B	1.07B	826M	761M
OpEx % of Revenue	-	24.93%	25.73%	28.04%	26.48%	26.76%	30%	29.72%	26.35%	27.51%	27.95%	26.14%	26.81%	29.61%	27.93%	28.03%	25.8%	26.71%
Selling, General & Admin	1.92B	1.92B	1.91B	1.76B	1.37B	1.18B	1.14B	1.16B	1.16B	1.09B	914M	854M	920M	990M	914M	877M	737M	667M
SG&A % of Revenue	-	21.28%	22.32%	23.86%	24.76%	22.69%	23.44%	22.06%	22.3%	23.14%	24.24%	23.38%	23.49%	25.8%	24.11%	23.06%	23.02%	23.41%
Research & Development	231M	226M	230M	232M	206M	204M	187M	191M	189M	180M	110M	95M	104M	104M	106M	100M	74M	63M
R&D % of Revenue	-	2.5%	2.69%	3.15%	3.73%	3.93%	3.84%	3.64%	3.63%	3.82%	2.92%	2.6%	2.66%	2.71%	2.8%	2.63%	2.31%	2.21%
Other Operating Expenses	4M	103M	62M	76M	-111M	7M	133M	211M	22M	25M	30M	6M	26M	42M	39M	89M	15M	31M
Operating Income	1.37B	1.22B	1.01B	652M	622M	585M	367M	486M	654M	552M	406M	449M	463M	363M	486M	395M	403M	276M
Operating Margin %	15.15%	13.54%	11.78%	8.85%	11.26%	11.26%	7.53%	9.26%	12.56%	11.73%	10.77%	12.29%	11.82%	9.46%	12.82%	10.39%	12.59%	9.69%
Operating Income Growth %	-	21.21%	54.75%	4.82%	6.32%	59.4%	-24.49%	-25.69%	18.48%	35.96%	-9.58%	-3.02%	27.55%	-25.31%	23.04%	-1.99%	46.01%	-
EBITDA	1.93B	1.8B	1.57B	1.09B	858M	830M	618M	743M	915M	786M	557M	582M	605M	513M	628M	532M	495M	346M
EBITDA Margin %	21.33%	19.9%	18.35%	14.77%	15.54%	15.98%	12.67%	14.16%	17.57%	16.7%	14.77%	15.93%	15.45%	13.37%	16.57%	13.99%	15.46%	12.14%
EBITDA Growth %	12.92%	14.45%	44.39%	26.81%	3.37%	34.3%	-16.82%	-18.8%	16.41%	41.11%	-4.3%	-3.8%	17.93%	-18.31%	18.05%	7.47%	43.06%	-
D&A (Non-Cash Add-back)	560M	575M	562M	436M	236M	245M	251M	257M	261M	234M	151M	133M	142M	150M	142M	137M	92M	70M
EBIT	1.38B	1.21B	1.13B	684M	490M	587M	362M	483M	687M	580M	486M	455M	489M	453M	443M	400M	388M	307M
Net Interest Income	-38M	-29M	-16M	-21M	-34M	-69M	-70M	-62M	-78M	-79M	-68M	-53M	-52M	-53M	-51M	-14M	0	0
Interest Income	0	0	28M	28M	16M	7M	7M	5M	4M	3M	2M	2M	2M	2M	4M	3M	0	0
Interest Expense	38M	29M	44M	49M	50M	76M	77M	67M	82M	82M	70M	55M	54M	55M	55M	17M	0	0
Other Income/Expense	-31M	-42M	78M	-17M	-182M	-74M	-82M	-70M	-69M	-86M	-68M	-46M	-42M	-65M	-94M	-12M	-15M	1M
Pretax Income	1.34B	1.18B	1.09B	635M	440M	511M	285M	416M	585M	466M	340M	403M	421M	298M	388M	383M	388M	277M
Pretax Margin %	14.8%	13.07%	12.7%	8.62%	7.97%	9.84%	5.85%	7.93%	11.23%	9.9%	9.02%	11.03%	10.75%	7.77%	10.23%	10.07%	12.12%	9.72%
Income Tax	270M	231M	197M	26M	85M	84M	31M	15M	36M	136M	80M	63M	84M	70M	91M	104M	59M	14M
Effective Tax Rate %	20.13%	19.56%	18.12%	4.09%	19.32%	16.44%	10.88%	3.61%	6.15%	29.18%	23.53%	15.63%	19.95%	23.49%	23.45%	27.15%	15.21%	5.05%
Net Income	1.07B	957M	890M	609M	355M	427M	254M	401M	549M	331M	260M	340M	337M	228M	297M	279M	329M	263M
Net Margin %	11.86%	10.59%	10.39%	8.27%	6.43%	8.22%	5.21%	7.64%	10.54%	7.03%	6.89%	9.31%	8.61%	5.94%	7.83%	7.34%	10.27%	9.23%
Net Income Growth %	13.29%	7.53%	46.14%	71.55%	-16.86%	68.11%	-36.66%	-26.96%	65.86%	27.31%	-23.53%	0.89%	47.81%	-23.23%	6.45%	-15.2%	25.1%	-
Net Income (Continuing)	1.07B	950M	890M	609M	355M	427M	254M	401M	549M	330M	260M	340M	337M	228M	297M	279M	329M	263M
Discontinued Operations	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Minority Interest	242M	269M	240M	10M	9M	8M	8M	10M	14M	16M	17M	0	0	0	0	0	0	0
EPS (Diluted)	4.61	3.92	3.65	2.79	1.96	2.35	1.40	2.21	3.03	1.83	1.45	1.87	1.83	1.22	1.59	1.50	1.78	1.42
EPS Growth %	16.2%	7.4%	30.82%	42.35%	-16.6%	67.86%	-36.65%	-27.06%	65.57%	26.21%	-22.46%	2.19%	50%	-23.27%	6%	-15.73%	25.35%	-
EPS (Basic)	-	3.93	3.67	2.81	1.97	2.37	1.41	2.23	3.05	1.84	1.45	1.88	1.84	1.23	1.60	1.51	1.78	1.42
Diluted Shares Outstanding	233.04M	244M	243.5M	218.18M	180.98M	181.53M	181.1M	181.2M	181.1M	180.9M	180M	181.7M	184.2M	186M	186.2M	185.3M	184.6M	184.6M
Basic Shares Outstanding	232.72M	243.4M	242.6M	216.98M	180.22M	180.25M	180.12M	179.99M	179.8M	179.6M	179.1M	180.9M	183.1M	185.2M	185.8M	185.1M	184.6M	184.6M
Dividend Payout Ratio	-	40.86%	39.33%	49.1%	61.13%	47.54%	74.02%	43.39%	27.69%	39.27%	43.08%	30%	27.89%	38.16%	25.25%	6.81%	-	-

Key Metrics

Growth RegimeStable

ProfitabilityStrong

Balance SheetHealthy

Cash FlowStable

Top Statement Risk

Skipped guidance and missing Q3 data

Verified Source

Metrics are mathematically derived from official filings.

SEC 10-K (2026Q3)

Growth Decelerates Under 80/20 Discipline

Quarterly revenue growth has cooled from a 26.0% surge in 2024Q2 to just 1.5% in 2026Q2, reflecting a deliberate pivot toward profitability over volume under the 80/20 strategy, which management appears to be accepting as a trade-off against near-term topline momentum.

The revenue trajectory shows a clear deceleration arc: mid-to-high single digit growth through 2025 (6.1%-7.8%) has compressed to low single digits (1.5%-2.7%) in the first half of 2026. This pattern is consistent with management's stated 80/20 strategy of deprioritizing lower-margin sales, but it also coincides with the reported softening in international demand, particularly in China, making it difficult to isolate how much of the slowdown is strategic versus cyclical. Investors should monitor whether the smart metering project timing delays noted in recent disclosures represent a temporary backlog shift or a more durable demand signal, as the MCS segment has historically been the lumpiest driver of Xylem's quarterly revenue.

Gross Margin Breakout to 41.2%

According to reported figures, Xylem's gross margin expanded from a 37.1% trough in 2025Q1 to 41.2% in 2026Q2, a 410 basis-point improvement that suggests the mix shift toward higher-margin engineered solutions and potential Evoqua procurement synergies are beginning to materialize in the P&L.

The margin trajectory has been one-directional through the recent period: 37.8% (2025Q1) → 38.8% → 38.9% → 38.9% (2025Q4) → 37.8% (2026Q1, a seasonal dip) → 41.2% (2026Q2). This compares favorably to Franklin Electric (35.5%) but still trails Pentair (40.5%) and Griffon (42.0%), suggesting Xylem has room to close the gap if the Water Infrastructure segment continues to outmix the lower-margin Applied Water business. However, the 41.2% print appears meaningfully above the trailing 10-quarter average of roughly 38.7%, and investors should treat it as a potential structural shift only if it persists through the next two quarters, as single-quarter margin spikes in industrial businesses can reflect favorable product mix timing rather than durable pricing power.

SG&A Discipline Amplifies Operating Leverage

As reported in financial statements, Xylem's operating income scaled from $231M in 2025Q1 to $390M in 2026Q2 (+69%), while revenue grew only 9.5% over the same span, indicating that SG&A leverage—rather than volume—is the dominant driver of margin expansion in the current cycle.

SG&A has remained remarkably contained, hovering between $445M and $507M across all ten quarters despite revenue fluctuations, which suggests the 80/20 strategy is functioning as an overhead-discipline mechanism as much as a pricing lever. The operating margin swing from 11.5% in 2026Q1 to 16.7% in 2026Q2 illustrates the degree of operating leverage embedded in the model, but also its volatility—this range compression is characteristic of a business absorbing large acquired assets (Evoqua) whose cost structure has not yet fully normalized. R&D spending has stayed in the $52M-$60M band, implying management is maintaining digital investment (Xylem Vue, Sensus analytics) even while cutting discretionary SG&A, which appears strategically sound but narrows the buffer if revenue growth stalls further.

Non-Operating Items Inflate Q4 Net Income

Based on EDBL's reported figures, Xylem's 2025Q4 net income of $335M exceeded operating income of $353M, and a similar divergence appeared in 2024Q4 ($326M net vs. $267M op), suggesting recurring non-operating tailwinds—likely tax benefits or equity-method gains—that flatter GAAP EPS in the fourth quarter.

This pattern of Q4 net income outpacing operating income, followed by sharp Q1 EPS declines ($1.37 → $0.79; $1.34 → $0.89), points to a seasonal non-operating item that analysts modeling on a straight-line basis will misforecast if they don't isolate it. Stock-based compensation of $12M-$16M per quarter is modest relative to net income (roughly 4-6%), so it is not a material dilutive drag, but the $0 SBC reported in 2026Q2 is anomalous and may reflect a data artifact rather than an actual elimination of equity awards. With the Evoqua intangible amortization still embedded in GAAP earnings, adjusted metrics likely paint a more consistent picture of underlying profitability than the quarterly EPS prints, which range from $0.69 to $1.37—a dispersion that overstates true operating volatility.

Missing Q3 Data Raises Disclosure Questions

The most recent quarter (2026Q3) shows no reported revenue, COGS, or operating income—only net income of $291M and EPS of $1.25—combined with a skipped guidance update, which warrants scrutiny of whether an operational or reporting irregularity underlies the incomplete disclosure.

Even setting aside the data gap, the counter-thesis to Xylem's margin narrative rests on three vulnerabilities: first, the 41.2% gross margin may prove transitory if commodity inputs (copper, steel) reflate or if the Evoqua integration costs reappear after what appears to be a clean quarter. Second, net income in 2026Q3 of $291M with EPS of $1.25 grew 34.4% year-over-year, but without the underlying revenue and margin lines, it is impossible to verify whether this reflects operational improvement or a lower tax rate/non-operating gain. Third, the absence of a refreshed forward guidance range removes the primary mechanism through which investors typically validate management's confidence, and historically in the industrial machinery sector, skipped guidance has correlated with forward demand softness. The combination of incomplete data, declining growth rates, and a missing outlook update should reduce conviction in the current margin-expansion thesis until Q4 disclosures restore visibility.

XYL — Frequently Asked Questions

Quick answers to the most common questions about buying XYL stock.

What was Xylem Inc.'s (XYL) revenue in 2025?

For fiscal year 2025, Xylem Inc. (XYL) reported total revenue of $9.04B. This represents a 217.1% increase compared to $2.85B in 2009.

Is Xylem Inc. (XYL) profitable?

Xylem Inc. (XYL) is profitable, generating $957.0M in net income for the fiscal year ending 2025 with a net profit margin of 10.6%.

What is Xylem Inc.'s operating profit margin?

Xylem Inc. (XYL) reported an operating income of $1.22B, resulting in an operating profit margin of 13.5%. This margin reflects the operational efficiency of the business before interest and taxes.

What is Xylem Inc.'s gross profit and gross margin?

Xylem Inc. (XYL) generated $3.48B in gross profit for the year, representing a gross profit margin of 38.5%. This demonstrates the company's core pricing power and production efficiency.