What changed in this filing

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Item 1. Financial Statements

2025-04-29 compared with 2024-10-28 · 258 added, 262 removed, 372 unchanged (58% of the section changed)

3 unchanged sentences

(In Millions, Except Share and Par Value Amounts)

September 30,

Current assets:

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Retained earnings

Accumulated other comprehensive (loss) income

Accumulated other comprehensive income (loss)

Treasury stock at cost 227,911,432 and 228,788,284 shares, respectively

8 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Operating revenues

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Interest expense, net

Equity in net income (losses) of unconsolidated entities

Equity in net income (loss) of unconsolidated entities

Income before income taxes

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Three Months Ended

Nine Months Ended

September 30,

Consolidated net income

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(In Millions)

Nine Months Ended

September 30,

Three Months Ended

Cash flows from operating activities:

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(Gain) loss from divestitures, asset impairments and other, net

Equity in net (income) losses of unconsolidated entities, net of dividends

Equity in net (income) loss of unconsolidated entities, net of dividends

Change in operating assets and liabilities, net of effects of acquisitions and divestitures:

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Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents

(Decrease) increase in cash, cash equivalents and restricted cash and cash equivalents

Increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents

Cash, cash equivalents and restricted cash and cash equivalents at beginning of period

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Noncontrolling

(Loss) Income

Three Months Ended September 30:

Balance, June 30, 2024

Consolidated net income

Other comprehensive income (loss), net of tax

Cash dividends declared of $ 0.75 per common share

Equity-based compensation transactions, net

Balance, September 30, 2024

Balance, June 30, 2023

Consolidated net income

Other comprehensive income (loss), net of tax

Cash dividends declared of $ 0.70 per common share

Equity-based compensation transactions, net

Common stock repurchase program

Balance, September 30, 2023

See Notes to Condensed Consolidated Financial Statements.

WASTE MANAGEMENT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ─ (Continued)

(In Millions, Except Shares in Thousands)

Waste Management, Inc.

Stockholders’ Equity

Comprehensive

Treasury Stock

Noncontrolling

(Loss) Income

Nine Months Ended September 30:

Income (Loss)

Balance, December 31, 2024

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Common stock repurchase program

Adoption of new accounting standard

Balance, September 30, 2024

Balance, March 31, 2025

Balance, December 31, 2023

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Common stock repurchase program

Balance, September 30, 2023

Balance, March 31, 2024

See Notes to Condensed Consolidated Financial Statements.

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Basis of Presentation

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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.

Our solid waste business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, recycling and resource recovery services.

Through our subsidiaries, including our Waste Management Renewable Energy (“WM Renewable Energy”) segment, 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”);

On November 4, 2024, we completed the acquisition of all outstanding shares of Stericycle, Inc.

(“Stericycle”), the operations of which are presented in this report as our new WM Healthcare Solutions segment.

The acquisition expands our offerings in the U.S.

and Canada and adds operations in parts of Western Europe.

These businesses provide regulated waste and compliance services and secure information destruction services that protect people and brands, promote health and well-being and safeguard the environment.

Refer to Note 8 for further discussion.

Our senior management evaluates, oversees and manages the financial performance of our business through five 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.

(iii) Recycling Processing and Sales;

(iv) WM Renewable Energy and (v) WM Healthcare Solutions.

Our East and West Tiers along with certain ancillary services (“Other Ancillary”) that are 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 five reportable segments, which are presented as Corporate and Other.

Refer to Note 7 for further discussion.

The Condensed Consolidated Financial Statements as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 are unaudited.

The Condensed Consolidated Financial Statements as of March 31, 2025 and for the three months ended March 31, 2025 and 2024 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.

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Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements.

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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

For example, revenue typically is recognized as waste is collected;

tons are received at our landfills, transfer stations or processing facilities;

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

Compliance services revenues are recognized over the contractual service period.

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.

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.

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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 September 30, 2024 and December 31, 2023, we had $ 216 million and $ 207 million, respectively, of deferred contract costs, of which $ 151 million and $ 148 million, respectively, were related to deferred sales incentives.

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.

As of March 31, 2025 and December 31, 2024, we had $ 221 million and $ 218 million, respectively, of deferred contract costs, of which $ 160 million and $ 154 million, respectively, were related to deferred sales incentives.

Amounts for our operating lease right-of-use assets are recorded in other long-term 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.

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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.

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 consolidated financial statements.

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Landfill and Environmental Remediation Liabilities

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

September 30, 2024

March 31, 2025

December 31, 2024

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Current (in accrued liabilities)

The changes to landfill and environmental remediation liabilities for the nine months ended September 30, 2024 are reflected in the table below (in millions):

The changes to landfill and environmental remediation liabilities for the three months ended March 31, 2025 are reflected in the table below (in millions):

Environmental

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Acquisitions, divestitures and other adjustments

September 30, 2024

March 31, 2025

At several of our landfills, we provide financial assurance by depositing cash into restricted trust funds for purposes of settling final capping, closure, post-closure and environmental remediation obligations.

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See Note 12 for additional information related to these trusts.

Debt and Derivatives

The following table summarizes the major components of debt at principal amounts as of each balance sheet date (in millions) and provides the maturities and interest rate ranges of each major category as of September 30, 2024:

September 30,

Commercial paper program (weighted average interest rate of 5.6 % as of December 31, 2023)

Senior notes, maturing through 2050, interest rates ranging from 0.75 % to 7.75 % (weighted average interest rate of 3.9 % as of September 30, 2024 and 3.7 % as of December 31, 2023)

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Commercial paper program (weighted average interest rate of 4.6 % as of March 31, 2025 and 4.7 % as of December 31, 2024)

Senior notes, maturing through 2054, interest rates ranging from 0.75 % to 7.75 % (weighted average interest rate of 4.2 % as of March 31, 2025 and December 31, 2024)

Canadian senior notes, C$ 500 million maturing September 2026, interest rate of 2.6 %

Tax-exempt bonds, maturing through 2053, fixed and variable interest rates ranging from 0.70 % to 5.0 % (weighted average interest rate of 3.7 % as of September 30, 2024 and 3.3 % as of December 31, 2023)

Financing leases and other, maturing through 2082 (weighted average interest rate of 4.9 % as of September 30, 2024 and 5.0 % as of December 31, 2023) (a)

Tax-exempt bonds, maturing through 2053, fixed and variable interest rates ranging from 0.7 % to 4.8 % (weighted average interest rate of 3.6 % as of March 31, 2025 and 3.7 % as of December 31, 2024)

Financing leases and other, maturing through 2082 (weighted average interest rate of 4.9 % as of March 31, 2025 and December 31, 2024) (a)

Debt issuance costs, discounts and other

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Debt Classification

As of September 30, 2024, we had approximately $ 1.9 billion of debt maturing within the next 12 months, including (i) $ 1.2 billion of tax-exempt bonds with term interest rate periods that expire within the next 12 months, which is prior to their scheduled maturities;

(ii) $ 422 million of 3.125 % senior notes that mature in March 2025 and (iii) $ 254 million of other debt with scheduled maturities within the next 12 months, including $ 110 million of tax-exempt bonds.

As of September 30, 2024, we have classified $ 1.2 billion of debt maturing in the next 12 months as long-term because we have the intent and ability to refinance these borrowings on a long-term basis as supported by the forecasted available capacity under our $ 3.5 billion long-term U.S.

and Canadian revolving credit facility (“$3.5 billion revolving credit facility”).

As of March 31, 2025, we had approximately $ 3.8 billion of debt maturing within the next 12 months, including (i) $ 1.5 billion of short-term borrowings under our commercial paper program (net of related discount on issuance);

(ii) $ 1.3 billion of tax-exempt bonds with term interest rate periods that expire within the next 12 months, which is prior to their scheduled maturities;

(iii) $ 500 million of 0.75 % senior notes that mature in November 2025 and (iv) $ 454 million of other debt with scheduled maturities within the next 12 months, including $ 298 million of tax-exempt bonds.

As of March 31, 2025, we have classified $ 2.8 billion of debt maturing in the next 12 months as long-term because we have the intent and ability to refinance these borrowings on a long-term basis as supported by the forecasted available capacity under our $ 3.5 billion long-term U.S.

and Canadian revolving credit facility (“$3.5 billion revolving credit facility”), as discussed below.

The remaining $ 954 million of debt maturing in the next 12 months is classified as current obligations.

Access to and Utilization of Credit Facilities and Commercial Paper Program

Term Credit Agreement Up to $ 7.2 Billion — On August 28, 2024, the Company entered into a delayed draw Term Credit Agreement in a principal amount of up to $7.2 billion (the “Term Credit Agreement”).

Borrowings under our Term Credit Agreement may be used to pay all or a portion of the consideration for our pending acquisition of Stericycle;

to pay, prepay or otherwise refinance certain indebtedness of Stericycle;

and/or to pay fees and expenses incurred in connection with the acquisition and the Term Credit Agreement.

The maturity date of borrowings under the Term Credit Agreement shall be the first business day that is 364 days after the date that borrowings are received (the “Funding Date”).

WM Holdings, a wholly-owned subsidiary of WMI, guarantees all of the obligations under the Term Credit Agreement.

Borrowings under the Term Credit Agreement will bear interest at a base rate or the secured overnight financing rate (“SOFR”) administered by the Federal Reserve Bank of New York, plus an applicable spread depending on our senior public debt rating assigned by Moody’s Investors Service, Inc.

and Standard and Poor’s Global Ratings.

The spread above SOFR can range from 0.90 % to 1.250 % per annum and the spread for base rate loans can range from zero to 0.250 % per annum.

We also pay certain other fees set forth in the Term Credit Agreement, including (a) a ticking fee accruing on the aggregate lending commitments from August 28, 2024 to the earlier of the Funding Date or the termination or expiration of the lending commitments under the Term Credit Agreement;

(b) extension fees on the aggregate lending commitments in effect on June 3, 2025 and December 31, 2025;

and (c) duration fees on the aggregate principal amount of borrowings outstanding on December 31, 2024, December 31, 2025 and at the end of each fiscal quarter.

As of September 30, 2024, there were no outstanding borrowings under our Term Credit Agreement and the ticking fee in effect was 0.065 % per annum.

$3.5 Billion Revolving Credit Facility — In May 2024, we amended and restated our $3.5 billion U.S.

and Canadian revolving credit facility, extending the term through May 2029.

The agreement includes a $ 1.0 billion accordion feature that may be used to increase total capacity in future periods, and we have the option to request up to two one-year extensions.

Waste Management of Canada Corporation and WM Quebec Inc., each an indirect wholly-owned subsidiary of WMI, are borrowers under the $3.5 billion revolving credit facility, and the agreement permits borrowing in Canadian dollars up to the U.S.

dollar equivalent of $ 375 million, with such borrowings to be repaid in Canadian dollars.

WM Holdings guarantees all the obligations under the $3.5 billion revolving credit facility.

The $3.5 billion revolving credit facility provides us with credit capacity to be used for cash borrowings, to support letters of credit and to support our commercial paper program.

$3.5 Billion Revolving Credit Facility — Our $3.5 billion revolving credit facility, maturing May 2029, provides us with credit capacity to be used for cash borrowings, to support letters of credit and to support our commercial paper program.

The interest rates we pay on outstanding U.S.

or Canadian loans are based on SOFR or the Canadian Overnight Repo Rate Average (“CORRA”) administered by the Bank of Canada, respectively, plus a spread depending on our senior public debt rating assigned by Moody’s Investors Service, Inc.

or Canadian loans are based on the Secured Overnight Financing Rate (“SOFR”) administered by the Federal Reserve Bank of New York or the Canadian Overnight Repo Rate Average (“CORRA”) administered by the Bank of Canada, respectively, plus a spread depending on our senior public debt rating assigned by Moody’s Investors Service, Inc.

and Standard and Poor’s Global Ratings.

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We also pay certain other fees set forth in the $3.5 billion revolving credit facility agreement, including a facility fee based on the aggregate commitment, regardless of usage.

As of September 30, 2024, we had no outstanding borrowings under this facility.

We had $ 171 million of letters of credit issued and no outstanding borrowings under our commercial paper program, both supported by the facility, leaving unused and available credit capacity of $ 3.3 billion as of September 30, 2024.

As of March 31, 2025, we had no outstanding borrowings under this facility.

We had $ 1.5 billion of outstanding borrowings (net of related discount on issuance) under our commercial paper program and $ 224 million of letters of credit issued, both supported by the facility, leaving unused and available credit capacity of $ 1.8 billion as of

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

March 31, 2025.

WM Holdings, a wholly-owned subsidiary of WMI, guarantees all of the obligations under the $3.5 billion revolving credit facility.

Commercial Paper Program — We have a commercial paper program that enables us to borrow funds for up to 397 days at competitive interest rates.

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The commercial paper program is fully supported by our $3.5 billion revolving credit facility.

In July 2024, we issued $ 1.5 billion of new senior notes and used the proceeds primarily to repay outstanding commercial paper borrowings.

As of September 30, 2024, we had no outstanding borrowings under our commercial paper program.

Other Letter of Credit Lines — As of September 30, 2024, we had utilized $ 863 million of other uncommitted letter of credit lines with terms maturing through December 2027.

As of March 31, 2025, we had $ 1.5 billion of outstanding borrowings (net of related discount on issuance) under our commercial paper program.

Other Letter of Credit Lines — As of March 31, 2025, we had utilized $ 860 million of other uncommitted letter of credit lines, with terms maturing through December 2028.

Debt Borrowings and Repayments

Commercial Paper Program — During the nine months ended September 30, 2024, we made cash repayments of $ 10.3 billion, which were partially offset by $ 9.4 billion of cash borrowings (net of related discount on issuance).

Senior Notes — During the nine months ended September 30, 2024, WMI issued $ 750 million of 4.950 % senior notes due 2027 and $ 750 million of 4.950 % senior notes due 2031, the net proceeds of which were $ 1.5 billion.

The net proceeds were used primarily to reduce outstanding borrowings under our commercial paper program.

During the nine months ended September 30, 2024, we repaid $ 156 million of WMI’s 3.5 % senior notes upon maturity in May 2024.

Treasury Locks — We use treasury lock agreements to hedge our exposure to interest rate changes and to reduce the volatility of financing costs on expected future debt issuances.

Each of our treasury lock transactions was designated as a cash flow hedge of the interest payments associated with an anticipated debt issuance.

During the third quarter of 2024, we entered into treasury lock transactions to fix the ten-year treasury rate on an aggregate notional amount of $ 900 million.

We also entered into treasury lock transactions to fix the thirty-year treasury rate on an aggregate notional amount of $ 650 million.

As of September 30, 2024, we recognized an unrealized loss of $ 35 million within accumulated other comprehensive (loss) income and an associated derivative liability reflected within accrued liabilities on the Company’s Condensed Consolidated Balance Sheets related to these cash flow hedges.

Upon termination, these derivatives will be amortized to earnings as a component of interest expense over the full term of each issuance.

Our effective income tax rate was 23.6 % and 22.2 % for the three and nine months ended September 30, 2024, respectively, compared with 24.1 % and 24.0 % for the three and nine months ended September 30, 2023, respectively.

The decrease in our effective income tax rate when comparing the three and nine months ended September 30, 2024 and 2023 was primarily driven by (i) an increase in federal tax credits and (ii) the reduction in the state and local income tax rate partially offset by impacts of adopting Accounting Standards Update (“ASU”) 2023-02, which is discussed further below.

Commercial Paper Program — During the three months ended March 31, 2025, we made cash repayments of $ 4.7 billion, which were more than offset by $ 5.0 billion of cash borrowings (net of related discount on issuance) used for general corporate purposes.

Senior Notes — We repaid $ 422 million of 3.125 % senior notes upon maturity in March 2025.

Our effective income tax rate was 19.2 % and 18.6 % for the three months ended March 31, 2025 and 2024, respectively.

The increase in our effective income tax rate when comparing the three months ended March 31, 2025 and 2024 was primarily driven by the timing of amortization resulting from our investment in low-income housing investments offset, in part, by federal tax credits.

We evaluate our effective income tax rate at each interim period and adjust it as facts and circumstances warrant.

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and Canada that produce renewable electricity and RNG.

We expect our new RNG facilities to qualify for federal tax credits and to realize those credits through 2027 under Sections 48 and 45Z of the Internal Revenue Code.

During the three and nine months ended September 30, 2024, we recognized a reduction in our income tax expense of $ 37 million and $ 111 million, respectively, due to federal tax credits expected to be realized from our RNG investments compared with $ 2 million and $ 6 million, respectively, for the comparable prior year periods.

We expect our new RNG facilities to qualify for federal tax credits and to realize those credits through 2026 under Section 48 of the Internal Revenue Code.

During the three months ended March 31, 2025 and 2024, we recognized a reduction in our income tax expense of $ 46 million and $ 37 million, respectively due to federal tax credits expected to be realized from our RNG investments.

Low-Income Housing — We have significant financial interests in entities established to invest in and manage low-income housing properties.

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The low-income housing investments qualify for federal tax credits that we expect to realize through 2036 under Section 42 or Section 45D of the Internal Revenue Code.

As a result of adopting ASU 2023-02, we amortize our investments in these entities using the proportional amortization method.

Under the proportional amortization method, the equity investment is amortized in proportion to the income tax credits and other income tax benefits received.

The amortization expense and the income tax credits are required to be presented on a net basis in income tax expense on the Condensed Consolidated Statements of Operations.

Prior to fiscal year 2024, we accounted for our investments in these entities using the equity method of accounting, recognizing our share of each entity’s results of operations and other reductions in the value of our investments in equity in net income (losses) of unconsolidated entities, within our Condensed Consolidated Statements of Operations.

During the three and nine months ended September 30, 2024, we recognized additional income tax expense of $ 19 million and $ 56 million, respectively, related to amortization under ASU 2023-02 and a reduction in our income tax expense primarily due to federal tax credits of $ 26 million and $ 76 million, respectively.

In addition, during the three and nine months ended September 30, 2024, we recognized interest expense of $ 5 million and $ 16 million, respectively, associated with our investments in low-income housing properties.

See Note 13 for additional information related to these unconsolidated variable interest entities.

During the three and nine months ended September 30, 2023, we recognized $ 18 million and $ 43 million of net losses, respectively, and a reduction in our income tax expense of $ 28 million and $ 76 million, respectively, primarily due to federal tax credits realized from these investments as well as the tax benefits from the pre-tax losses realized.

In addition, during the three and nine months ended September 30, 2023, we recognized interest expense of $ 3 million and $ 10 million, respectively, associated with our investments in low-income housing properties.

During the three months ended March 31, 2025, we recognized income tax expense of $ 20 million related to amortization under ASU 2023-02 and a reduction in our income tax expense of $ 27 million primarily due to federal tax credits realized from these investments.

In addition, during the three months ended March 31, 2025, we recognized interest expense of $ 9 million associated with our investments in low-income housing properties.

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the three months ended March 31, 2024, we recognized $ 20 million of net losses and a reduction in our income tax expense of $ 28 million primarily due to federal tax credits realized from these investments.

In addition, during the three months ended March 31, 2024, we recognized interest expense of $ 6 million associated with our investments in low-income housing properties.

See Note 12 for additional information related to these unconsolidated variable interest entities.

Earnings Per Share

Basic and diluted earnings per share were computed using the following common share data (shares in millions):

Three Months Ended

Nine Months Ended

September 30,

Basic and diluted earnings per share for the three months ended March 31 were computed using the following common share data (shares in millions):

Number of common shares outstanding at end of period

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These facilities are discussed further in Note 3.

Surety bonds and insurance policies are supported by (i) a diverse group of third-party

surety and insurance companies;

Surety bonds and insurance policies are supported by (i) a diverse group of third-party surety and insurance companies;

(ii) an entity in which we have a noncontrolling financial interest or (iii) a wholly-owned insurance captive, the sole business of which is to issue surety bonds and/or insurance policies on our behalf.

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We have retained a significant portion of the risks related to our health and welfare, general liability, automobile liability and workers’ compensation claims programs.

“General liability” refers to the self-insured portion of specific third-party claims made against us that may be covered under our commercial general liability insurance policy.

“General liability” refers to the self-insured portion of specific third-

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

party claims made against us that may be covered under our commercial general liability insurance policy.

For our self-insured portions, the exposure for unpaid claims and associated expenses, including incurred but not reported losses, is based on an actuarial valuation or internal estimates.

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No additional liabilities have been recorded for these intercompany guarantees because all of the underlying obligations are reflected in our Condensed Consolidated Balance Sheets.

As of September 30, 2024, we have guaranteed the obligations and certain performance requirements of third parties in connection with both consolidated and unconsolidated entities, including guarantees to cover the difference, if any, between the sale value and the guaranteed market or contractually-determined value of certain homeowner’s properties that are adjacent to or near 19 of our landfills.

As of March 31, 2025, we have guaranteed the obligations and certain performance requirements of third parties in connection with both consolidated and unconsolidated entities, including guarantees to cover the difference, if any, between the sale value and the guaranteed market or contractually-determined value of certain homeowner’s properties that are adjacent to or near 18 of our landfills.

We have also agreed to indemnify certain third-party purchasers against liabilities associated with divested operations prior to such sale.

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Determining the method and ultimate cost of remediation requires that a number of assumptions be made.

There can sometimes be a range of reasonable estimates of the costs associated with the likely site remediation alternatives identified

in the environmental impact investigation.

There can sometimes be a range of reasonable estimates of the costs associated with the likely site remediation alternatives identified in the environmental impact investigation.

In these cases, we use the amount within the range that is our best estimate.

If no amount within a range appears to be a better estimate than any other, we use the amount that is the low end of such range.

If we used the high ends of such ranges (where estimable), our aggregate potential liability would be approximately $ 17 million higher than the $ 202 million recorded in the Condensed Consolidated Balance Sheet as of September 30, 2024.

If we used the high ends of such ranges (where estimable), our aggregate potential liability would be approximately $ 9 million higher than the $ 219 million recorded in the Condensed Consolidated Balance Sheet as of March 31, 2025.

Our ultimate responsibility may differ materially from current estimates.

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These adjustments could be material in any given period.

As of September 30, 2024, we had been notified by the government that we are a PRP in connection with 74 locations listed on the Environmental Protection Agency’s (“EPA’s”) Superfund National Priorities List, or NPL.

As of March 31, 2025, we had been notified by the government that we are a PRP in connection with 74 locations listed on the Environmental Protection Agency’s (“EPA’s”) Superfund National Priorities List, or NPL.

Of the 74 sites at which claims have been made against us, 14 are sites we own.

Each of the NPL sites we own was initially developed by others as a landfill disposal facility.

At each of these facilities, we are working in conjunction with the government to characterize or remediate identified site problems, and we have either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or are working toward a cost-sharing agreement.

Each of the NPL sites we own were initially developed by others as a landfill disposal facility.

At each of these facilities, we are working in conjunction with the government to

WASTE MANAGEMENT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

characterize or remediate identified site problems, and we have either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or are working toward a cost-sharing agreement.

We generally expect to receive any amounts due from other participating parties at or near the time that we make the remedial expenditures.

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MIMC and IPC have continued to work on a remedial design to support the EPA’s proposed remedy;

however, in the first quarter of 2024, the EPA publicly issued a letter alleging that the remedial design has serious deficiencies.

MIMC and IPC subsequently engaged with the EPA and provided responses to the EPA letter.

The EPA responded that, while the parties had not remedied all concerns from its letter, the parties had sufficiently demonstrated a path forward and were given additional time to submit a full remedial design, which was submitted during the third quarter of 2024.

In late October 2024, the EPA provided comments in response to the full remedial design submission and the parties are currently reviewing those comments.

As of September 30, 2024 and December 31, 2023, the recorded liability for MIMC’s estimated potential share of costs for the remedy was approximately $ 85 million.

however, in the first quarter of 2024, the EPA publicly issued a letter alleging that the remedial design had serious deficiencies.

MIMC and IPC engaged with the EPA throughout the year, and in November 2024, MIMC and IPC publicly issued a proposed revised full remedial design to address the EPA’s comments.

Due to increases in the estimated costs of the remedy to address the EPA’s comments, in the fourth quarter of 2024 we recorded an additional $ 13 million liability for MIMC’s estimated potential share of such costs.

As a result, the recorded liability as of March 31, 2025 and December 31, 2024 was approximately $ 97 million.

MIMC’s ultimate liability could be materially different from current estimates, including potential increases resulting from MIMC’s continued engagement with the EPA regarding a final remedial design for the site.

Item 103 of the SEC’s Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings, or such proceedings are known to be contemplated, unless we reasonably believe that the matter will result in no monetary sanctions, or in monetary sanctions, exclusive of interest and costs, below a stated threshold.

In accordance with this SEC regulation, the Company uses a threshold of $ 1 million for purposes of determining

whether disclosure of any such environmental proceedings is required.

As of the date of this filing, we are not aware of any matters that are required to be disclosed pursuant to this standard.

In accordance with this SEC regulation, the Company uses a threshold of $ 1 million for purposes of determining whether disclosure of any such environmental proceedings is required.

Other than the matter discussed below involving Stericycle’s divested Domestic Environmental Solutions business, we are not aware of any matters in the first quarter of 2025 that are required to be disclosed pursuant to this standard.

From time to time, we are also named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of having owned, operated or transported waste to a disposal facility that is alleged to have contaminated the environment or, in certain cases, on the basis of having conducted environmental remediation activities at sites.

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While we believe we have meritorious defenses to these lawsuits, the ultimate resolution is often substantially uncertain due to the difficulty of determining the cause, extent and impact of alleged contamination (which may have occurred over a long period of time), the potential for successive groups of complainants to emerge, the diversity of the individual plaintiffs’ circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties, among other factors.

Additionally, we often enter into agreements with landowners imposing obligations on us to meet certain regulatory or contractual conditions upon site closure or upon termination of the agreements.

Additionally, we often enter into agreements with landowners imposing obligations on

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

us to meet certain regulatory or contractual conditions upon site closure or upon termination of the agreements.

Compliance with these agreements inherently involves subjective determinations and may result in disputes, including litigation.

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We currently do not believe that the eventual outcome of any such actions will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

On November 4, 2024, the Company acquired Stericycle.

At the time of the acquisition, Stericycle was subject to the following legal matters, which are now legal matters of our wholly-owned subsidiary.

Stericycle entered into a deferred prosecution agreement (“DPA”) with the U.S.

Department of Justice (“DOJ”) and a cease-and-desist order with the SEC in 2022 relating to Stericycle’s compliance with the U.S.

Foreign Corrupt Practices Act and other anti-corruption laws with respect to now-divested operations in Latin America.

The DPA and cease-and-desist order required Stericycle to engage an independent compliance monitor for two years, which Stericycle satisfied.

Additionally, the DPA required Stericycle to self-report any potential violations of the anti-corruption laws through November 2025.

In April 2025, the DOJ filed, and the court granted, a motion for early termination of the DPA, and the deferred charges against Stericycle have been dismissed with prejudice.

This matter did not have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

Stericycle has been cooperating with an investigation by the office of the U.S.

Attorney for the Southern District of New York (“SDNY”) and the EPA into Stericycle’s historical compliance with federal environmental statutes, including the Resource Conservation and Recovery Act, in connection with the collection, transportation and disposal of hazardous waste by Stericycle’s Domestic Environmental Solutions business unit that was divested in 2020.

Stericycle previously disclosed that it made an accrual in respect of this matter of approximately $ 10 million.

In January 2025, the parties agreed on settlement terms for this matter, which are within Stericycle’s prior accrual.

On January 17, 2025, the U.S.

Attorney filed a complaint in the U.S.

District Court for the SDNY, and on the same day, announced the settlement agreement with Stericycle.

The settlement received court approval, and this matter is fully resolved.

The settlement did not have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

On February 11, 2020, Stericycle received an administrative subpoena from the U.S.

Drug Enforcement Administration (“DEA”), which executed a search warrant at a facility in Rancho Cordova, California and an administrative inspection warrant at a facility in Indianapolis, Indiana for materials related to Stericycle’s now-divested Domestic Environmental Solutions business of collecting, transporting, and destroying controlled substances from retail customers (the “ESOL Retail Controlled Substances Business”).

On that same day, agents from the California Department of Toxic Substances Control executed a separate search warrant at the Rancho Cordova facility.

Since that time, the U.S.

Attorney’s Office for the Eastern District of California (“USAO EDCA”) has been overseeing criminal and civil investigations of the ESOL Retail Controlled Substances Business.

The USAO EDCA informed Stericycle that the investigations relate to Stericycle’s operation and sale of its ESOL Retail Controlled Substances Business that was divested in 2020 and has asserted that Stericycle and some of Stericycle’s current or former employees may have civil and criminal liability under the Controlled Substances Act and other federal statutes related to that business.

Stericycle has been cooperating with the ongoing investigations, which are limited to the period of

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Stericycle’s historical operation and ownership of the ESOL Retail Controlled Substances Business from 2015 through 2020.

While the ultimate disposition of this matter remains uncertain, we do not currently believe that it will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

In June 2022, we and certain of our officers were named as defendants in a complaint alleging violation of the federal securities laws and seeking certification as a class action in the U.S.

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A lead plaintiff has been appointed and an amended complaint was filed in January 2023.

The amended complaint seeks damages on behalf of a putative class of secondary market purchasers of our senior notes with a special mandatory redemption feature issued in May 2019, asserting claims under the Securities Exchange Act based on alleged misrepresentations and omissions concerning the time for completion of our acquisition of Advanced Disposal.

The amended complaint seeks damages on behalf of a putative class of secondary market purchasers of our senior notes with a special mandatory redemption feature issued in May 2019, asserting claims under the Securities Exchange Act of 1934, as amended based on alleged misrepresentations and omissions concerning the time for completion of our acquisition of Advanced Disposal.

The court certified a class on March 31, 2025.

The case is currently in the discovery phase, and we intend to vigorously defend against this pending suit.

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Multiemployer Defined Benefit Pension Plans — About 20 % of our workforce is covered by collective bargaining agreements with various local unions across the U.S.

and Canada, and certain parts of Europe.

As a result of some of these agreements, certain of our subsidiaries are participating employers in a number of trustee-managed multiemployer defined benefit pension plans (“Multiemployer Pension Plans”) for the covered employees.

A complete or partial withdrawal from a Multiemployer Pension Plan may also occur if employees covered by a collective bargaining agreement vote to decertify a union from

continuing to represent them.

In connection with our ongoing renegotiation of various collective bargaining agreements, we may discuss and negotiate for the complete or partial withdrawal from one or more of these Multiemployer Pension Plans.

A complete or partial withdrawal from a Multiemployer Pension Plan may also occur if employees covered by a collective bargaining agreement vote to decertify a union from continuing to represent them.

Any other circumstance resulting in a decline in Company contributions to a Multiemployer Pension Plan through a reduction in the labor force, whether through attrition over time or through a business event (such as the discontinuation or nonrenewal of a customer contract, the decertification of a union, or relocation, reduction or discontinuance of certain operations) may also trigger a complete or partial withdrawal from one or more of these pension plans.

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However, liability for future withdrawals could have a material adverse effect on our results of operations or cash flows for a particular reporting period, depending on the number of employees withdrawn and the financial condition of the Multiemployer Pension Plan(s) at the time of such withdrawal(s).

Tax Matters — We participate in the IRS’s Compliance Assurance Process, which means we work with the IRS throughout the year towards resolving any material issues prior to the filing of our annual tax return.

Tax Matters — We maintain a liability for uncertain tax positions, the balance of which management believes is adequate.

Results of audit assessments by taxing authorities are not currently expected to have a material adverse effect on our financial condition, results of operations or cash flows.

We participate in the IRS’s Compliance Assurance Process, which means we work with the IRS throughout the year towards resolving any material issues prior to the filing of our annual tax return.

Any unresolved issues as of the tax return filing date are subject to routine examination procedures.

In the fourth quarter of 2022, the Company received a notice of tax due for the 2017 tax year related to a remaining disagreement with the IRS.

In the fourth quarter of 2022, the Company received a notice of tax due for the 2017 tax year related to a remaining

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

disagreement with the IRS.

In response to the notice, the Company made a deposit of approximately $ 103 million with the IRS.

The Company expects to seek a refund of the entire amount deposited with the IRS and litigate any denial of the claim for refund.

As of September 30, 2024 and December 31, 2023, the IRS deposit, net of reserve for uncertain tax positions, is classified as a component of other long-term assets in the Company’s Condensed Consolidated Balance Sheets.

In addition, we are in the examination phase of IRS audits for the 2023 and 2024 tax years and expect the audits to be completed within the next 18 months.

We are also currently undergoing audits by the Canada Revenue Agency for the 2021 tax year and various state and local jurisdictions for tax years that date back to 2014.

We maintain a liability for uncertain tax positions, the balance of which management believes is adequate.

Results of audit assessments by taxing authorities are not currently expected to have a material adverse effect on our financial condition, results of operations or cash flows.

In the fourth quarter of 2024, the Company filed a claim for refund of the entire amount deposited with the IRS.

We expect to litigate any denial of the claim for refund.

As of March 31, 2025 and December 31, 2024, the IRS deposit, net of reserve for uncertain tax positions, was classified as a component of other long-term assets in the Company’s Condensed Consolidated Balance Sheets.

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;

Our senior management evaluates, oversees and manages the financial performance of our business through five reportable segments, referred to as (i) East Tier;

(ii) West Tier;

(iii) Recycling Processing and Sales and (iv) WM Renewable Energy.

Our East and West Tier, along with Other Ancillary services 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.

Summarized financial information concerning our reportable segments is shown in the following table (in millions):

(iii) Recycling Processing and Sales;

(iv) WM Renewable Energy and (v) WM Healthcare Solutions.

Our East and West Tiers along with Other Ancillary services that are 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 five reportable segments, which are presented as Corporate and Other.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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

Depreciation,

Depletion and

Administrative

Operations(b)

Three Months Ended September 30:

Collection and Disposal:

Other Ancillary

Collection and Disposal (c)(d)

Recycling Processing and Sales (c)

WM Renewable Energy (d)

Corporate and Other

Collection and Disposal:

Other Ancillary

Collection and Disposal (c)(d)

Recycling Processing and Sales (c)

WM Renewable Energy (d)

Corporate and Other

Collection and Disposal(d)(e)

Recycling Processing and Sales(d)

WM Renewable Energy(e)

WM Healthcare Solutions

Corporate and Other(e)

Intercompany Elimination

Depreciation,

Depletion and

Administrative

Operations(b)

Nine Months Ended September 30:

Collection and Disposal:

Other Ancillary

Collection and Disposal (c)(d)

Recycling Processing and Sales (c)

WM Renewable Energy (d)

Corporate and Other

Collection and Disposal:

Other Ancillary

Collection and Disposal (c)(d)

Recycling Processing and Sales (c)

WM Renewable Energy (d)

Corporate and Other

Collection and Disposal(d)(e)

Recycling Processing and Sales(d)

WM Renewable Energy(e)

Corporate and Other(e)

Intercompany Elimination

(a) Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments.

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(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.

(c) Certain fees related to the processing of recycled material we collect are included within our Collection and Disposal businesses.

The amounts in income from operations for the three and nine months ended September 30, 2024, are $ 29 million and $ 77 million, respectively.

The amounts in income from operations for three and nine months ended September 30, 2023, are $ 16 million and $ 41 million, respectively.

(d) WM Renewable Energy pays a 15 % intercompany royalty to our Collection and Disposal businesses for landfill gas.

The total amount of royalties in income from operations for the three and nine months ended September 30, 2024, are $ 13 million and $ 34 million, respectively.

The total amount of royalties in income from operations for the three and nine months ended September 30, 2023, are $ 10 million and $ 30 million, respectively .

The mix of operating revenues from our major lines of business are as follows (in millions):

Three Months Ended September 30:

Other collection

Total collection

Total Collection and Disposal

Recycling Processing and Sales

WM Renewable Energy

Corporate and Other

Other collection

Total collection

Total Collection and Disposal

Capital expenditures are reported in our reportable segments at the time they are recorded within the segments’ property and equipment balances and, therefore, include timing differences for amounts accrued but not yet paid.

(d) Certain fees related to the processing of recyclable material we collect are included within our Collection and Disposal businesses.

The amounts in income from operations for the three months ended March 31, 2025 and 2024 are $ 20 million and $ 22 million, respectively.

(e) WM Renewable Energy pays a 15 % intercompany royalty to our Collection and Disposal and Corporate and Other businesses for landfill gas.

The total amount of royalties in gross and intercompany operating revenues for the East Tier, West Tier, and Corporate and Other and in operating expenses for WM Renewable Energy for the three months ended March 31, 2025 and 2024 are $ 14 million and $ 10 million, respectively.

Prior to the fourth quarter of 2024, amounts related to intercompany royalty payments were adjusted through income from operations.

Prior periods have been recast to conform to current year presentation.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(f) Other net expenses include restructuring expenses, (gain) loss from divestitures, and asset impairments and unusual items, net.

Total assets by reportable segment are presented in the table below as follows (in millions):

Collection and Disposal:

Other Ancillary

Collection and Disposal

Recycling Processing and Sales

WM Renewable Energy

WM Healthcare Solutions

Corporate and Other

Nine Months Ended September 30:

Elimination of intercompany investments and advances

Total assets, per Condensed Consolidated Balance Sheet

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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

Revenues (a)(b)

Other collection

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WM Renewable Energy

WM Healthcare Solutions

Corporate and Other

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Transactions within and between segments are generally made on a basis intended to reflect the market value of the service.

(b) Beginning with the 2024 Form 10-K, the Company adjusted gross and intercompany operating revenues to reflect the 15 % royalty paid by WM Renewable Energy to our Collection and Disposal and Corporate and Other businesses for the purchase of landfill gas.

There was no change to net operating revenues.

Prior periods have been recast to conform to current presentation.

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.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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.

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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.

During the nine months ended September 30, 2024, we completed solid waste and recycling acquisitions primarily in New York, Florida, North Carolina, and Arizona with total consideration of $ 780 million, which included $ 774 million in cash paid and $ 6 million of other consideration, specifically purchase price holdbacks.

In addition, we paid $ 16 million of holdbacks, primarily related to prior year acquisitions.

Total consideration for our 2024 acquisitions was primarily allocated to $ 160 million of property and equipment, $ 78 million of other intangible assets, primarily customer relationships, and $ 581 million of goodwill.

The goodwill was primarily a result of expected synergies from combining the acquired businesses with our existing operations and substantially all was tax deductible.

We remain in the measurement period for most of our acquisitions, and adjustments to our preliminary purchase price allocation may occur.

Pending Acquisition of Stericycle

On June 3, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) to acquire all outstanding shares of Stericycle for $ 62.00 per share in cash, representing a total enterprise value of approximately $ 7.2 billion when including approximately $ 1.4 billion of Stericycle’s net debt.

Stericycle is a U.S.

based leading provider of compliance-based solutions for regulated waste, including medical waste, and secure information destruction.

Stericycle serves customers in North America and Europe.

We expect the Stericycle acquisition to close in the fourth quarter of 2024, and we intend to finance the Stericycle acquisition through a combination of bank debt, commercial paper and/or issuance of senior notes.

(Gain) Loss from Divestitures, Asset Impairments and Unusual Items, Net

(Gain) loss from divestitures, asset impairments and unusual items, net for the three months ended September 30, 2024 primarily relates to a $ 14 million loss associated with the divestiture of a minority investment in a medical waste company within Corporate and Other, in connection with our pending acquisition of Stericycle.

The nine months ended September 30, 2024 include a $ 54 million charge required to increase the estimated fair value of a liability associated with the expected disposition of an investment the Company holds in a waste diversion technology business recorded during the second quarter of 2024.

This charge is reflected in our Corporate and Other measures within our segment reporting.

(Gain) loss from divestitures, asset impairments and unusual items, net for the three and nine months ended September 30, 2023 were not material.

Accumulated Other Comprehensive (Loss) Income

The changes in the balances of each component of accumulated other comprehensive (loss) income, net of tax, which is included as a component of Waste Management, Inc.

Acquisitions and Divestitures

Stericycle Acquisition

On June 3, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) to acquire all outstanding shares of Stericycle for $ 62.00 per share in cash, representing a total enterprise value of approximately $ 7.2 billion (net of cash acquired) when including the assumption of $ 0.5 billion of debt and the repayment of approximately $ 0.8 billion of net debt.

The acquisition expands our offerings in the U.S., Canada and parts of Western Europe by providing regulated waste and compliance services and secure information destruction services that protect people and brands, promote health and well-being and safeguard the environment.

The transaction closed on November 4, 2024 and was funded using borrowings under a term credit agreement, commercial paper program and available cash on hand.

Shortly thereafter, we repaid all outstanding borrowings under the term credit agreement with net proceeds from our November 2024 issuance of $ 5.2 billion of senior notes.

Our consolidated financial statements have not been retroactively restated to include Stericycle’s historical financial position or results of operations.

The acquisition is accounted for as a business combination.

In accordance with the purchase method of accounting, the purchase price paid has been allocated to the assets and liabilities acquired based upon their estimated fair values as of the acquisition date, with the excess of the purchase price over the net assets acquired recorded as goodwill.

We are in the process of valuing all of the assets and liabilities acquired in the acquisition and until we have completed our valuation process, there may be adjustments to our estimates of fair value and resulting preliminary purchase price allocation.

Our estimates and assumptions are subject to change during the measurement period, not to exceed one year from the acquisition date.

The areas of acquisition accounting that are not yet finalized primarily relate to (i) finalizing the review and valuation of trade names, permits, customer relationships and certain property plant and equipment and other intangibles (including the models, key assumptions, estimates and inputs used) and assignment of remaining useful lives associated with the depreciable and amortizable assets and (ii) finalizing the review and valuation of accounts receivable, accrued expenses, contingent liabilities, deferred taxes and goodwill (including key assumptions, inputs and estimates).

Goodwill of $ 3.7 billion was calculated as the excess of the consideration paid over the net assets recognized and represents the future economic benefits expected to arise from other assets acquired that could not be individually identified and separately recognized and from synergies of the combination.

During the first quarter of 2025, we finalized the determination of our reporting units related to the Stericycle acquisition and allocated the goodwill balance to two reporting units within our WM Healthcare Solutions segment using a relative fair value allocation method.

Substantially all of the goodwill is not deductible for income tax purposes.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table shows the preliminary purchase price allocation as of the date acquired and adjustments to March 31, 2025 (in millions):

November 4, 2024

March 31, 2025

Cash and cash equivalents

Accounts and other receivables

Parts and supplies

Other current assets

Assets held for sale (a)

Property and equipment

Other intangible assets

Accounts payable

Accrued liabilities

Deferred revenues

Current portion of long-term debt

Liabilities held for sale (a)

Long-term debt, less current portion

Deferred income taxes

Other liabilities

Total purchase price

(a) Represents Stericycle’s Spain and Portugal subsidiaries.

See “Divestitures” below for additional information.

The preliminary allocation of $ 3,468 million for other intangible assets includes $ 2,279 million for customer relationships with a weighted average amortization period of 15 years , $ 610 million for indefinite lived trade names, $ 319 million for indefinite lived permits, $ 114 million for finite lived trade names with a weighted average amortization period of 2.9 years, $ 141 million for ERP software with a weighted average amortization period of 4.7 years and $ 5 million for developed technology with an amortization period of 17 years .

On January 2, 2025, we completed the sale of our WM Healthcare Solutions’ Spain and Portugal subsidiaries.

As the fair value of consideration transferred was equal to the carrying value of the divested subsidiaries, no gain or loss was recognized.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Income (Loss)

The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, which is included as a component of Waste Management, Inc.

stockholders’ equity, are as follows (in millions, with amounts in parentheses representing decreases to accumulated other comprehensive income):

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Net current period other comprehensive income (loss)

Balance, September 30, 2024

Balance, March 31, 2025

Common Stock Repurchase Program

The Company repurchases shares of its common stock as part of capital allocation programs authorized by our Board of Directors.

In February 2024, we repurchased 0.2 million shares of our common stock through an October 2023 Accelerated Share Repurchase (“ASR”) agreement that completed in February 2024, based on a final weighted average price of $ 175.29 .

Also in February 2024, we entered into an ASR agreement to repurchase $ 250 million of our common stock.

At the beginning of the repurchase period, we delivered $ 250 million cash and initially received 1 million shares based on a stock price of $ 199.16 , exclusive of the applicable 1% excise tax.

The ASR agreement completed in April 2024 and we received 0.2 million additional shares based on a final weighted average price of $ 206.23 .

In the second quarter of 2024 we repurchased 0.1 million shares of our common stock in open market transactions in compliance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act for $ 12 million, inclusive of per-share commissions, at a weighted average price of $ 209.20 .

There were no common stock repurchases during the third quarter of 2024.

As of September 30, 2024, the Company has authorization for $ 1,238 million of future share repurchases.

As a result of the pending Stericycle acquisition discussed in Note 8, the Company previously announced that it has temporarily suspended share repurchases.

The amount of future share repurchases executed under our Board of Directors’ authorization is determined at management’s discretion, based on various factors, including our net earnings, financial condition and cash required for future business plans, growth and acquisitions.

There were no common stock repurchases during the first quarter of 2025.

As a result of the Stericycle acquisition, the Company has temporarily suspended share repurchases.

We expect to resume share repurchase once the Company’s leverage returns to targeted levels.

Fair Value Measurements

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Our assets and liabilities that are measured at fair value on a recurring basis include the following (in millions):

September 30,

Quoted prices in active markets (Level 1):

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Total assets measured at fair value

Significant other observable inputs (Level 2):

Interest rate derivatives

Total liabilities measured at fair value

(a) Our available-for-sale securities primarily relate to debt securities with maturities over the next ten years .

See Note 9 for information related to our nonrecurring fair value measurements.

Fair Value of Debt

As of September 30, 2024 and December 31, 2023, the carrying value of our debt was $ 16.7 billion and $ 16.2 billion, respectively.

The estimated fair value of our debt was approximately $ 16.3 billion as of September 30, 2024 and $ 15.6 billion as of December 31, 2023.

Although we have determined the estimated fair value amounts using available market information and commonly accepted valuation methodologies, considerable judgment is required in interpreting market data to develop the estimates

of fair value.

As of March 31, 2025 and December 31, 2024, the carrying value of our debt was $ 23.8 billion and $ 23.9 billion, respectively.

The estimated fair value of our debt was approximately $ 23.2 billion and $ 22.9 billion as of March 31, 2025 and December 31, 2024, respectively.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange.

The use of different assumptions or estimation methodologies could have a material effect on the estimated fair values.

The fair value estimates are based on Level 2 inputs of the fair value hierarchy available as of September 30, 2024 and December 31, 2023.

The fair value estimates are based on Level 2 inputs of the fair value hierarchy available as of March 31, 2025 and December 31, 2024.

These amounts have not been revalued since those dates and current estimates of fair value could differ significantly from the amounts presented.

See Note 8 for information related to the nonrecurring fair value measurement of assets and liabilities acquired in connection with our acquisition of Stericycle.

Variable Interest Entities

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We do not consolidate our investments in entities established to manage low-income housing properties because we are not the primary beneficiary of these entities as we do not have the power to individually direct the activities of these entities.

Our aggregate investment balance in these entities was $ 381 million and $ 458 million as of September 30, 2024 and December 31, 2023, respectively.

The debt balance related to our investments in low-income housing properties was $ 373 million and $ 408 million as of September 30, 2024 and December 31, 2023, respectively.

Our aggregate investment balance in these entities was $ 684 million and $ 707 million as of March 31, 2025 and December 31, 2024, respectively.

The debt balance related to our investments in low-income housing properties was $ 655 million and $ 670 million as of March 31, 2025 and December 31, 2024, respectively.

Additional information related to these investments is discussed in Note 4.

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Our interests in these trusts are accounted for as investments in unconsolidated entities and receivables.

These amounts are recorded in other receivables, investments in unconsolidated entities and long-term other assets in our Condensed Consolidated Balance Sheets, as appropriate.

We also reflect our share of the unrealized gains and losses on available-for-sale securities held by these trusts as a component of our accumulated other comprehensive (loss) income.

Our investments and receivables related to these trusts had an aggregate carrying value of $ 112 million and $ 104 million as of September 30, 2024 and December 31, 2023, respectively.

These amounts are recorded in other receivables, investments in unconsolidated entities and other long-term assets in our Condensed Consolidated Balance Sheets, as appropriate.

We also reflect our share of the unrealized gains and losses on available-for-sale securities held by these trusts as a component of our accumulated other comprehensive income (loss).

Our investments and receivables related to these trusts had an aggregate carrying value of $ 111 million at March 31, 2025 and December 31, 2024.

Consolidated Variable Interest Entities — Trust funds for which we are the sole beneficiary are consolidated because we are the primary beneficiary.

These trust funds are recorded in restricted funds in our Condensed Consolidated Balance Sheets.

Unrealized gains and losses on available-for-sale securities held by these trusts are recorded as a component of accumulated other comprehensive (loss) income.

These trusts had a fair value of $ 124 million and $ 119 million as of September 30, 2024 and December 31, 2023, respectively.

Subsequent Events

Stericycle Exchange Offer and Consent Solicitation

On September 10, 2024, we announced that, in connection with the acquisition of Stericycle, we commenced a private exchange offer (the “Exchange Offer”) and related consent solicitation on behalf of Stericycle (the “Consent Solicitation”) with respect to the outstanding 3.875 % Senior Notes due 2029 issued by Stericycle (the “SRCL Notes”).

The Exchange Offer and the Consent Solicitation are being made upon the terms and conditions set forth in an exchange offer memorandum and consent solicitation statement dated September 10, 2024 (the “Offering Memorandum”).

Pursuant to the Exchange Offer, we are offering to issue new notes (the “WM Notes”) in exchange for any and all of the $ 500 million aggregate principal amount of the SRCL Notes held by holders eligible to participate in the Exchange Offer (“Eligible Holders”).

The WM Notes will have the same interest rate, interest payment dates and maturity date as the exchanged SRCL notes but will differ in certain respects from the SRCL Notes, including the redemption provisions, as described in the Offering Memorandum.

In addition, pursuant to the Consent Solicitation, we solicited on behalf of

Stericycle and, as of September 23, 2024, we received consents from the Eligible Holders to amend the SRCL Notes and the related indenture under which they were issued to eliminate substantially all of the restrictive covenants, restrictive provisions and events of default, other than payment-related, guarantee-related and bankruptcy-related events of default (the “Proposed Amendments”).

The Exchange Offer and Consent Solicitation are being made solely pursuant to the conditions set forth in the Offering Memorandum in a private offering exempt from, or not subject to, registration under the Securities Act of 1933, as amended, and are conditioned upon, among other things, the consummation of the acquisition of Stericycle.

As of September 23, 2024 (the “Early Tender Date”), $ 474,581,000 in aggregate principal amount of SRCL Notes, representing approximately 94.92 % of the aggregate principal amount of SRCL Notes outstanding, had been validly tendered and not validly withdrawn.

As a result, we have received the requisite number of consents to adopt the Proposed Amendments.

Eligible Holders of SRCL Notes validly tendered and not validly withdrawn by the Early Tender Date, and accepted for exchange, will receive at settlement an equal principal amount of WM Notes and cash consideration of approximately $ 2.63 per $1,000 principal amount of SRCL Notes.

On October 8, 2024, we issued a press release extending the expiration date of the Exchange Offer and Consent Solicitation (the “Expiration Date”) from October 8, 2024 to October 31, 2024, which may be further extended by us in our sole discretion.

As of October 8, 2024, $ 485,255,000 in aggregate principal amount of SRCL Notes representing approximately 97.05 % of the aggregate principal amount of SRCL Notes outstanding, had been validly tendered and not validly withdrawn.

Eligible Holders of SRCL Notes validly tendered and not validly withdrawn after the Early Tender Deadline but on or prior to the Expiration Date, and accepted for exchange, will receive at settlement $ 970 principal amount of WM Notes per $ 1,000 principal amount of SRCL Notes and no cash consideration.

We expect to settle the Exchange Offer on or about the third business day after the Expiration Date, as such date may be further extended.

Pending Acquisition of Stericycle and Related Financing

We currently expect to draw $ 5.2 billion principal amount of borrowings under the Term Credit Agreement to finance the majority of the Stericycle acquisition consideration.

On October 28, 2024, we entered into a first amendment to the Term Credit Agreement to simplify logistics and permit such borrowings in advance of closing the acquisition.

All conditions to closing the Stericycle acquisition with respect to antitrust and foreign direct investment laws have now been satisfied, with the exception of only the final clearance from the Competition Bureau of Canada pursuant to the Canadian Competition Act.

This final clearance, funding of the borrowings under the Term Credit Agreement and the closing of the Stericycle acquisition are expected to occur in the fourth quarter of 2024.

Unrealized gains and losses on available-for-sale securities held by these trusts are recorded as a component of accumulated other comprehensive income (loss).

These trusts had a fair value of $ 131 million and $ 128 million as of March 31, 2025 and December 31, 2024, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements