AI Takeaway
Xylem (XYL) delivered strong FY2025 results with revenue growing 5.5% to $9.0B, operating income surging 21.2% to $1.2B, and net income rising 7.5% to $957M, reflecting meaningful margin expansion and disciplined cost management.
Revenue
$9.04B
++5.52% YoY
EPS (Basic)
$3.93
++7.08% YoY
Gross Margin
38.5%
++0.95% YoY
Operating Income
$1.22B
++21.21% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-K filing
Xylem grew total revenue 5.5% year-over-year to $9.04B in FY2025 (from $8.56B in FY2024), reflecting continued demand across its water technology portfolio. This growth outpaced cost of revenue growth of 3.9%, enabling gross profit to expand 8.2% to $3.48B.
Source: Source: 10-K Income Statement
Operating income jumped 21.2% to $1.22B, with operating margin expanding approximately 175 basis points to 13.5% from 11.8% in the prior year. This improvement reflects operating leverage as revenue grew faster than operating expenses, with SG&A rising only 0.6% to $1.92B.
Source: Source: 10-K Income Statement & Key Ratios
Gross margin improved approximately 95 basis points to 38.5% in FY2025 from 37.5% in FY2024, indicating better pricing power or favorable product/service mix and cost efficiencies in the cost of revenue base.
Source: Source: 10-K Key Ratios
2 more insights available
Upgrade to unlockCurrent liabilities surged 22.3% year-over-year to $2.86B, significantly outpacing the 13.3% growth in current assets ($4.64B). While the current ratio of 1.63 remains above 1.0, the rapid build-up in short-term obligations warrants monitoring for potential near-term liquidity stress.
Source: Source: 10-K Balance Sheet
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $1.42 versus the $1.42 analyst consensus — a -0.3% miss for FY2025.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $9.04B | $8.56B | +5.52% |
Cost of Revenue | $5.56B | $5.35B | +3.93% |
Gross Profit | $3.48B | $3.21B | +8.19% |
Operating Income | $1.22B | $1.01B | +21.21% |
Net Income | $957M | $890M | +7.53% |
EPS (Basic) | $3.93 | $3.67 | +7.08% |
EPS (Diluted) | $3.92 | $3.65 | +7.40% |
R&D Expense | $226M | $230M | -1.74% |
SG&A Expense | $1.92B | $1.91B | +0.63% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $17.63B | $16.49B | +6.92% |
Current Assets | $4.64B | $4.1B | +13.25% |
Total Liabilities | $5.88B | $5.61B | +4.88% |
Current Liabilities | $2.86B | $2.34B | +22.26% |
Stockholders' Equity | $11.48B | $10.64B | +7.87% |
Cash & Equivalents | $1.48B | $1.12B | +31.94% |
Long-Term Debt | $1.95B | $2.03B | -3.79% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $1.24B | $1.26B | -1.74% |
Investing Cash Flow | $-471M | $-482M | +2.28% |
Financing Cash Flow | $-501M | $-615M | +18.54% |
Share Buybacks | $15M | $20M | -25.00% |
D&A | $575M | $562M | +2.31% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 38.5% | 37.5% | +0.95% |
Operating Margin | 13.5% | 11.8% | +1.75% |
Net Margin | 10.6% | — | — |
ROE | 8.3% | — | — |
ROA | 5.4% | — | — |
Current Ratio | $1.625 | — | — |
Debt to Equity | $0.513 | — | — |
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Xylem delivered strong FY2025 results with revenue of $9.04B (up 5.5%), operating income of $1.22B (up 21.2%), and net income of $957M (up 7.5%). Diluted EPS grew 7.4% to $3.92, reflecting solid operational execution and meaningful margin expansion.
Xylem's revenue grew 5.5% to $9.04B in FY2025, driven by continued demand across its water technology portfolio. Importantly, cost of revenue grew at a slower pace of 3.9%, allowing gross profit to expand 8.2% to $3.48B and gross margin to improve to 38.5%.
Yes, Xylem achieved notable margin improvement in FY2025, with gross margin expanding to 38.5% (from 37.5%) and operating margin rising to 13.5% (from 11.8%), a gain of approximately 175 basis points. This was driven by operating leverage as SG&A expenses grew only 0.6% while revenue grew 5.5%.
Xylem's balance sheet is in solid shape, with cash and equivalents up 31.9% to $1.48B, long-term debt reduced 3.8% to $1.95B, and a current ratio of 1.63. The debt-to-equity ratio stands at a conservative 0.51, and stockholders' equity grew 7.9% to $11.48B.
Key risks for Xylem include a 22.3% surge in current liabilities to $2.86B that has tightened the current ratio, a slight decline in operating cash flow despite higher net income (suggesting working capital pressure), and integration risk from a large acquired asset base. The company's ROE of 8.3% also remains relatively modest, indicating the large equity base from acquisitions has yet to generate proportionally high returns.