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Republic Services reported Q3 FY2026 revenue of $4.6 billion, above the $4.4 billion consensus. Adjusted earnings per share of $1.94 also beat the $1.92 consensus. Revenue increased from $4.2 billion a year earlier, while diluted earnings per share rose to $1.93 from $1.76.
The company’s filing says pricing increases across its lines of business lifted quarterly revenue, as did higher fuel recovery fees and emergency response activity. Volume reduced revenue because of a decline in residential collection, primarily attributable to municipal contract losses. Landfill volume also fell, partly because the prior year included non-recurring hurricane recovery work.
Republic reported an operating margin of 20.2%, compared with 19.8% a year earlier, while gross margin moved to 41.6% from 41.5%. Quarterly free cash flow fell to $646.0 million from $739.0 million.
| Q3 FY2026 | Q3 FY2025 | Change | |
|---|---|---|---|
| Revenue | $4.6 billion | $4.2 billion | 8.24% |
| Diluted EPS | $1.93 | $1.76 | 9.93% |
| Gross margin | 41.6% | 41.5% | 0.1 percentage points |
| Operating margin | 20.2% | 19.8% | 0.4 percentage points |
| Free cash flow | $646.0 million | $739.0 million | −12.6% |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Adjusted EPS | $1.94 | $1.92 | Beat by 1.04% |
| Revenue | $4.6 billion | $4.4 billion | Beat by 3.38% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
What management said on the call
CEO Jon Vander Ark said pricing remained the primary driver of organic revenue growth. Average yield on related revenues exceeded internal cost inflation, although he said its sequential moderation reflected better-than-expected container volumes and increased service levels. Those service increases add route density but typically dilute average yield, he said.
CFO Brian DelGhiaccio said small- and large-container volumes each increased 50 basis points in the quarter, while residential volume declined 4.3%, primarily because of municipal contract losses. Vander Ark said customer affordability had caused Republic to back off slightly on some pricing. Discussing municipal contracts, he said the company would like to grow the business over time but, when forced to choose, would take price over volume.
Vander Ark said a few large emergency response jobs drove environmental solutions growth. Excluding those jobs, segment revenue grew approximately 9%. DelGhiaccio said the segment’s adjusted EBITDA margin was 25.4%, while the total company margin was 31.8%. He attributed margin pressure to net fuel, prior-year landfill event volumes and elevated health care costs; he said claims activity returned to more normal levels in October.
On investment, Vander Ark said AI-enabled pricing technology was deployed across the business and a routing platform remained in pilot, with full deployment expected to begin early next year. In the question-and-answer session, he said most routing rollout would occur next year and the full benefit would be a 2028 story. He also said Republic had invested $1.1 billion in acquisitions so far this year.
Asked about the updated outlook, DelGhiaccio said approximately $150 million of the midpoint revenue increase related to fuel fees and $50 million to environmental solutions. He expected the fuel recovery fee to catch up early in the fourth quarter after a September fuel-cost spike.
Guidance
Republic’s updated FY2026 revenue guidance is $17.425 billion to $17.475 billion; its previous guidance was $17.2 billion–$17.3 billion. The company’s release raised adjusted EBITDA guidance to $5.550 billion to $5.575 billion, from $5.525 billion to $5.55 billion, while Vander Ark stated a range of $5.5 billion to $5.575 billion on the latest call.
Republic expects adjusted free cash flow of $2.565 billion to $2.585 billion, compared with its prior call guidance of $2.54 billion to $2.575 billion.
| Metric | For | Guide | Previous guide | Change |
|---|---|---|---|---|
| EBITDA, Digital Initiatives Run Rate | FY2028 | $100.0 million | — | New |
| Units, Volume Growth | FY2027 | Republic Services expects positive volume in FY2027 if the macroeconomic environment remains supportive. | — | — |
| Units growth, Residential Volume Growth | FY2027 | −2.00% | — | New |
| Free cash flow, non-GAAP | FY2026 | $2.6 billion–$2.6 billion | $2.5 billion–$2.6 billion | Raised |
| EBITDA, non-GAAP | FY2026 | $5.5 billion–$5.6 billion | $5.5 billion–$5.6 billion | Held |
| Revenue | FY2026 | $17.4 billion–$17.5 billion | $17.2 billion–$17.3 billion | Raised |
| Tax rate, Equivalent Tax Impact | FY2026 | 24.0% | — | New |
| Units, Electric Truck Fleet | FY2026 | 300 | — | — |
| Revenue, Environmental Solutions | FY2026 | Republic Services expects positive environmental solutions revenue growth for the rest of FY2026. | — | — |
| EPS, non-GAAP | FY2026 | $7.23–$7.28 | — | — |
| Free cash flow | FY2026 | $2.5 billion–$2.6 billion | — | New |
| EPS | FY2026 | $7.23–$7.28 | — | — |
| EBITDA | FY2026 | $5.5 billion–$5.6 billion | — | New |