Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

​

The following management discussion and analysis (“MD&A”) provides information we believe is useful in understanding our operating results, cash flows and financial condition. We provide quantitative or qualitative information about the material sales drivers including the impact of changes in volume and pricing and the effect of acquisitions and changes in foreign currency at the corporate and reportable segment level. We also provide quantitative information regarding special (gains) and charges, discrete tax items and other significant factors we believe are useful for understanding our results. Such quantitative drivers are supported by comments meant to be qualitative in nature. Qualitative factors are generally ordered based on estimated significance.

​

The MD&A should be read in conjunction with both the unaudited consolidated financial information and related notes included in this Form 10-Q, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2024. This discussion contains various Non-GAAP Financial Measures and also contains various Forward-Looking Statements within the meaning of the Private Securities Litigation Reform Act of 1995. We refer readers to the statements entitled “Non-GAAP Financial Measures” and “Forward-Looking Statements” located at the end of Part I of this report.

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Comparability of Results

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Impact of Acquisitions and Divestitures

​

Our non-GAAP financial measures for organic sales, organic operating income and organic operating income margin are at fixed currency and exclude the impact of special (gains) and charges, the results of our acquired businesses from the first twelve months post acquisition and the results of divested businesses from the twelve months prior to divestiture. In addition, as part of the separation of ChampionX in 2020, we continue to provide certain products to ChampionX which are recorded in product and equipment sales in the Global Water segment along with the related cost of sales. These transactions are removed from the consolidated results as part of the calculation of the impact of acquisitions and divestitures.

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Comparability of Reportable Segments

​

Effective January 1, 2025, the Company’s former Global Industrial reportable segment was renamed Global Water and includes the Light & Heavy (previously named Water), Food & Beverage, and Paper operating segments. The Global Institutional & Specialty reportable segment continues to include the Institutional and Specialty operating segments. The Company’s former healthcare operating segment moved into the Institutional operating segment. Global Life Sciences was elevated to a standalone reportable segment. The Global Pest Elimination segment remains a standalone reportable segment. After these changes, the Company has seven operating segments.

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Fixed Currency Foreign Exchange Rates

​

Management evaluates the sales and operating income performance of our non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on our international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. Public currency rate data provided within the “Segment Performance” section of this MD&A reflect amounts translated at actual public average rates of exchange prevailing during the corresponding period and is provided for informational purposes only.

​

​

OVERVIEW OF THE THIRD QUARTER ENDED SEPTEMBER 30, 2025

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Sales Performance

​

When comparing third quarter 2025 against third quarter 2024, sales performance was as follows:

​

●	Reported net sales increased 4% to $4,165.0 million and organic sales increased 3%.

●	Organic sales for our Global Water segment increased 2% to $1,929.4 million driven by sales growth in Food & Beverage and Light & Heavy.

●	Organic sales for our Global Institutional & Specialty segment increased 4% to $1,544.4 million driven by growth in both Institutional and Specialty.

●	Organic sales for Global Pest Elimination increased 6% to $321.3 million.

●	Organic sales for our Global Life Sciences segment increased 6% to $171.0 million.

​

​

Financial Performance

​

When comparing third quarter 2025 against third quarter 2024, our financial performance was as follows:

​

●	Reported operating income decreased 27% to $760.2 million, including an unfavorable impact from the prior year gain on the sale of our global surgical solutions business. Organic operating income increased 10%.

●	Net income attributable to Ecolab decreased 21% to $585.0 million. Excluding the impact of special (gains) and charges and discrete tax items from both 2025 and 2024 reported results, our adjusted net income attributable to Ecolab increased 13%.

●	Reported diluted EPS decreased 21% to $2.05. Excluding the impact of special (gains) and charges and discrete tax items from both 2025 and 2024 reported results, adjusted diluted EPS increased 13% to $2.07 in the third quarter of 2025.

●	Our reported tax rate was 17.8% during the third quarter of 2025, compared to 25.0% during the third quarter of 2024. Excluding the tax rate impact of special (gains) and charges and discrete tax items from both 2025 and 2024 results, our adjusted tax rate was 20.0% during the third quarter of 2025, compared to 19.7% during the third quarter of 2024.

​

​

RESULTS OF OPERATIONS

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Net Sales

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended									​	​	Nine Months Ended
​	​	September 30									​	​	September 30
(millions)	​	2025			​	2024		​	Change		​	​	2025			​	2024		​	Change
Product and equipment sales	​	​	$3,262.6	​	​	​	$3,156.0	​	​	​	​	​	​	$9,321.3	​	​	​	$9,315.6	​	​	​
Service and lease sales	​	​	902.4	​	​	​	842.5	​	​	​	​	​	​	2,563.9	​	​	​	2,420.6	​	​	​
Reported GAAP net sales	​	​	4,165.0	​	​	​	3,998.5	​	4	%	​	​	​	11,885.2	​	​	​	11,736.2	​	1	%
Effect of foreign currency translation	​		(173.1)	​	​	​	(111.8)	​	​	​	​	​		(333.0)	​	​	​	(356.7)	​	​	​
Non-GAAP fixed currency sales	​	​	3,991.9	​	​	​	3,886.7	​	3	%	​	​	​	11,552.2	​	​	​	11,379.5	​	2	%
Effect of acquisitions and divestitures	​	​	(25.8)	​	​	​	(42.5)	​	​	​	​	​	​	(77.7)	​	​	​	(242.1)	​	​	​
Non-GAAP organic sales	​	​	$3,966.1	​	​	​	$3,844.2	​	3	%	​	​	​	$11,474.5	​	​	​	$11,137.4	​	3	%

​

​

Product and sold equipment revenue is generated from providing cleaning, sanitizing and water treatment products or selling equipment used in combination with specialized products. Service and lease equipment revenue is generated from providing services or leasing equipment to customers. All of our sales are subject to the same economic conditions.

​

The percentage components of the period-over-period 2025 sales change are shown below:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended					​	Nine Months Ended
​	​	September 30					​	September 30
(percent)		2025						2025
Volume		​	​	1	%	​	​		​	1	%	​
Pricing		​	​	3	​	​	​		​	2	​	​
Organic sales change		​	​	3	​	​	​		​	3	​	​
Acquisitions and divestitures		​	​	-	​	​	​		​	(1)	​	​
Fixed currency sales change		​	​	3	​	​	​		​	2	​	​
Foreign currency translation		​	​	2	​	​	​		​	-	​	​
Reported GAAP net sales change		​	​	4	%	​	​		​	1	%	​

​

Amounts do not necessarily sum due to rounding.

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Cost of Sales (“COS”) and Gross Profit Margin

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	Third Quarter Ended													​	Nine Months Ended
​	September 30													​	September 30
​	2025						​	2024						​	2025						​	2024
​					Gross		​					Gross		​					Gross		​					Gross
(millions/percent)	COS			​	Margin		​	COS			​	Margin		​	COS			​	Margin		​	COS			​	Margin
Product and equipment cost of sales	​	$1,789.1	​	​	​	​	​	​	$1,771.2	​	​	​	​	​	​	$5,122.9	​	​	​	​	​	​	$5,221.0	​	​	​	​
Service and lease cost of sales	​	510.3	​	​	​	​	​	​	490.3	​	​	​	​	​	​	1,459.5	​	​	​	​	​	​	1,409.6	​	​	​	​
Reported GAAP COS and gross margin	​	2,299.4	​	​	44.8	%	​	​	2,261.5	​	​	43.4	%	​	​	6,582.4	​	​	44.6	%	​	​	6,630.6	​	​	43.5	%
Special (gains) and charges	​	0.3	​		​	​	​	​	0.9	​		​	​	​	​	7.6	​		​	​	​	​	3.2	​		​	​
Non-GAAP adjusted COS and gross margin	​	$2,299.1	​	​	44.8	%	​	​	$2,260.6	​	​	43.5	%	​	​	$6,574.8	​	​	44.7	%	​	​	$6,627.4	​	​	43.5	%

​

Our COS and corresponding gross profit margin (“gross margin”) are shown in the table above. Gross margin is defined as net sales less cost of sales divided by net sales.

​

​

Our reported gross margin was 44.8% and 43.4% for the third quarter of 2025 and 2024, respectively. Our reported gross margin was 44.6% and 43.5% for the first nine months of 2025 and 2024, respectively. Special (gains) and charges included in items impacting cost of sales are shown within the “Special (Gains) and Charges” table below.

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Excluding the impact of special (gains) and charges within COS, third quarter 2025 and 2024 adjusted gross margin was 44.8% and 43.5%, respectively, and for the first nine months of 2025 and 2024 was 44.7% and 43.5%, respectively. Our adjusted gross margin increased when comparing the third quarter of 2025 against the third quarter of 2024 reflecting strong value pricing.

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Selling, General and Administrative Expense

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Selling, general and administrative (“SG&A”) expenses as a percentage of sales were 25.9% and 26.9% for the third quarter and first nine months of 2025, respectively, compared to 25.6% and 27.1% for the third quarter and first nine months of 2024, respectively. The SG&A ratio to sales in the third quarter of 2025 was impacted by growth-oriented investments in the business, including recent acquisitions. The SG&A ratio to sales decreased in the first nine months of 2025 as productivity more than offset growth-oriented investments in the business.

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Special (Gains) and Charges

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Special (gains) and charges reported on the Consolidated Statements of Income include the following items:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended						​	Nine Months Ended						​
​	​	September 30						​	September 30						​
(millions)		2025			​	2024			2025			​	2024		​
Cost of sales	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
One Ecolab	​	​	$0.3	​	​	​	$-	​	​	$7.6	​	​	​	$-	​
Other restructuring	​	​	-	​	​	​	0.9	​	​	-	​	​		3.2	​
Cost of sales subtotal	​	​	0.3	​	​	​	0.9	​	​	7.6	​	​		3.2	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Special (gains) and charges	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
One Ecolab	​	​	17.4	​	​	​	24.4	​	​	83.3	​	​	​	38.9	​
Other restructuring	​	​	-	​	​	​	0.4	​	​	(12.0)	​	​		20.1	​
Sale of global surgical solutions business	​	​	-	​	​	​	(364.0)	​	​	2.4	​	​	​	(350.7)	​
Acquisition and integration activities	​	​	11.0	​	​	​	3.5	​	​	19.8	​	​	​	8.3	​
Other	​	​	(2.2)	​	​	​	3.1	​	​	(13.2)	​	​		(8.8)	​
Special (gains) and charges subtotal	​	​	26.2	​	​	​	(332.6)	​	​	80.3	​	​		(292.2)	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Total special (gains) and charges	​	​	$26.5	​	​	​	($331.7)	​	​	$87.9	​	​	​	($289.0)	​

​

For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with our internal management reporting. Per share amounts do not necessarily sum due to rounding.

​

One Ecolab

​

On July 30, 2024, we announced the One Ecolab initiative, which will enhance our growth and margin expansion journey. As a program within this initiative, we also announced that we commenced a restructuring plan to leverage our digital technologies to realign the functional work done in many countries into global centers of excellence. In September 2025, we expanded the One Ecolab initiative and anticipate restructuring costs of $240 million ($187 million after tax) or $0.66 per diluted share and special charges of $60 million ($47 million after tax) or $0.16 per diluted share by the end of 2027. We anticipate that the restructuring costs will primarily be cash expenditures for severance costs relating to team reorganization. We also expanded the estimated annualized cost savings to $225 million in continuing operations by 2027. One Ecolab has delivered $79 million of cumulative cost savings.

​

We recorded restructuring charges of $9.5 million ($7.3 million after tax), or $0.03 per diluted share and $17.4 million ($13.3 million after tax), or $0.05 per diluted share during the third quarter of 2025 and 2024, respectively, and $66.3 million ($51.0 million after tax), or $0.18 per diluted share and $22.7 million ($17.3 million after tax), or $0.06 per diluted share during the first nine months of 2025 and 2024, respectively, primarily related to severance and professional services. In addition, we recorded non-restructuring special charges of $8.2 million ($6.2 million after tax), or $0.02 per diluted share and $7.0 million ($5.2 million after tax), or $0.02 per diluted share during the third quarter of 2025 and 2024, respectively, and $24.6 million ($18.6 million after tax), or $0.06 and $16.2 million ($12.2 million after tax), or $0.04 per diluted share during the first nine months of 2025 and 2024, respectively, primarily related to professional services. We have recorded $148.1 million ($114.0 million after tax), or $0.40 per diluted share of cumulative restructuring charges and $48.3 million ($36.5 million after tax), or $0.13 per diluted share of cumulative special charges under the One Ecolab initiative.

​

The restructuring liability related to the One Ecolab initiative was $64.8 million and $54.9 million as of September 30, 2025 and December 31, 2025, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities.

​

​

Other restructuring

​

Other restructuring is primarily related to the Combined Program, which is described below. These activities have been included as a component of cost of sales and special (gains) and charges on the Consolidated Statements of Income. Restructuring liabilities have been classified as a component of other current and other noncurrent liabilities on the Consolidated Balance Sheets.

​

Further details related to our restructuring charges are included in Note 2.

​

Combined Program

​

In November 2022 we approved a Europe cost savings program and subsequently expanded the program to focus on our Institutional and Healthcare businesses in other regions (the “Combined Program”). The restructuring activities were completed at the end of 2024, with total costs of $184.1 million ($151.5 million after tax), or $0.53 per diluted share. Subsequent to the completion of the Combined Program, we finalized the sale of a facility, resulting in a gain of $12 million ($9.2 million after tax), or $(0.03) per diluted share in the second quarter of 2025. The Combined Program has delivered our targeted $175 million of annual cost savings.

​

The net liability related to the Combined Program was $3.2 million and $12.8 million as of September 30, 2025 and December 31, 2024, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities.

​

Other Restructuring Activities

​

The restructuring liability balance for all other restructuring plans excluding the Combined Program and One Ecolab was $5.6 million and $6.5 million as of September 30, 2025 and December 31, 2024, respectively.

​

Sale of global surgical solutions business

On April 27, 2024, we reached a definitive agreement to sell our global surgical solutions business for total consideration of $950 million, subject to certain working capital and other purchase price adjustments. On August 1, 2024, we closed the sale and received $926 million in cash, after deducting for defined working capital and other purchase price adjustments. For the quarter ended September 30, 2024, we recorded an associated pre-tax gain within Special (Gains) and Charges in the Consolidated Statements of Income of $365.3 million ($264.2 million after tax) or ($0.92) per diluted share, which includes $56.4 million of transaction costs and other adjustments. Excluding the gain on sale, we recorded charges of $3.3 million ($2.5 million after tax) or $0.01 per diluted share and $14.6 million ($11.3 million after tax) or $0.04 per diluted share in the third quarter and first nine months of 2024, respectively, which are primarily related to professional fees to support the sale.

​

We recorded charges of $2.4 million ($1.8 million after tax) or $0.01 per diluted share in the first nine months of 2025, which are primarily related to professional fees to support the sale.

​

Acquisition and integration related costs

​

Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $11.0 million ($10.2 million after tax) or $0.04 per diluted share and $3.5 million ($2.7 million after tax) or $0.01 per diluted share in the third quarter of 2025 and 2024, respectively, and $19.8 million ($16.9 million after tax) or $0.06 per diluted share and $8.3 million ($6.3 million after tax) or $0.02 per diluted share in the first nine months of 2025 and 2024, respectively, primarily related to the pending acquisition of Ovivo’s electronics business and the Purolite transaction.

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Other operating activities

​

Other special gains recorded in special (gains) and charges on the Consolidated Statements of Income in the third quarter of 2025 and 2024 were ($2.2 million) ($1.7 million gain after tax) or ($0.01) per diluted share and charges of $3.1 million ($2.3 million after tax) or less than $0.01 per diluted share, respectively. Other special gains recorded in special (gains) and charges on the Consolidated Statements of Income in the first nine months of 2025 and 2024 were ($13.2 million) ($11.4 million gain after tax) or ($0.04) per diluted share and ($8.8 million) ($6.9 million gain after tax) or ($0.02) per diluted share, respectively, primarily related to the sale of an equity method investment.

​

​

Operating Income and Operating Income Margin

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended									​	Nine Months Ended
​	​	September 30									​	September 30
(millions)	​	2025				2024		​	​		​	2025				2024		​	​
Reported GAAP operating income	​	​	$760.2	​	​	​	$1,044.8	​	(27)	%	​	​	$2,025.6	​	​	​	$2,219.6	​	(9)	%
Special (gains) and charges	​		26.5	​	​		(331.7)	​	​	​	​		87.9	​	​		(289.0)	​	​	​
Non-GAAP adjusted operating income	​		786.7	​	​		713.1	​	10	%	​		2,113.5	​	​		1,930.6	​	9	%
Effect of foreign currency translation	​		(39.3)	​	​		(25.6)	​	​	​	​		(71.3)	​	​		(79.1)	​	​	​
Non-GAAP adjusted fixed currency operating income	​	​	747.4	​	​	​	687.5	​	9	%	​	​	2,042.2	​	​	​	1,851.5	​	10	%
Effect of acquisitions and divestitures	​	​	(4.9)	​	​	​	(10.7)	​	​	​	​	​	(9.1)	​	​	​	(52.5)	​	​	​
Non-GAAP organic operating income	​	​	$742.5	​	​	​	$676.8	​	10	%	​	​	$2,033.1	​	​	​	$1,799.0	​	13	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended							​	​	​	Nine Months Ended							​	​
​	​	September 30							​	​	​	September 30							​	​
(percent)	​	2025			​	2024			​	​	​	2025			​	2024			​	​
Reported GAAP operating income margin	​	​	18.3	%	​	​	26.1	%	​	​	​	​	17.0	%	​	​	18.9	%	​	​
Non-GAAP adjusted operating income margin	​	​	18.9	%	​	​	17.8	%	​	​	​	​	17.8	%	​	​	16.4	%	​	​
Non-GAAP adjusted fixed currency operating income margin	​	​	18.7	%	​	​	17.7	%	​	​	​	​	17.7	%	​	​	16.3	%	​	​
Non-GAAP organic operating income margin	​	​	18.7	%	​	​	17.6	%	​	​	​	​	17.7	%	​	​	16.2	%	​	​

​

Our operating income and corresponding operating income margin are shown in the previous tables. Operating income margin is defined as operating income divided by net sales.

​

Our reported operating income decreased 27% in the third quarter of 2025 and decreased 9% in first nine months of 2025 versus the comparable periods of 2024. Our reported operating income for 2025 and 2024 was impacted by special (gains) and charges; excluding the impact of special (gains) and charges from 2025 and 2024 reported results, our adjusted operating income increased 10% and 9% in the third quarter and first nine months of 2025, respectively.

​

As shown in the previous table, foreign currency had a 1 percentage point positive impact and 1 percentage point negative impact on adjusted operating income growth for the third quarter and first nine months of 2025, respectively. Foreign currency had a 2 and 1 percentage point negative impact on adjusted operating income growth for the third quarter and first nine months of 2024, respectively.

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Other (Income) Expense

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended									​	Nine Months Ended						​	​
​	​	September 30									​	September 30						​	​
(millions)	​	2025				2024			Change		​	2025				2024			Change
Reported GAAP other (income) expense	​	​	($12.8)	​	​	​	($12.9)	​	(1)	%	​	​	($38.8)	​	​	​	($38.1)	​	2	%

​

Reported other (income) expense decreased to ($12.8) million from ($12.9) million in the third quarter of 2025 compared to the third quarter of 2024, respectively, and increased to ($38.8) million from ($38.1) million in the first nine months of 2025 compared to the first nine months of 2024, respectively.

​

Interest Expense, Net

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended									​	Nine Months Ended						​	​
​	​	September 30									​	September 30						​	​
(millions)	​	2025				2024			Change		​	2025				2024			Change
Reported GAAP interest expense, net	​	​	$55.3	​	​	​	$70.4	​	(21)	%	​	​	$176.8	​	​	​	$220.8	​	(20)	%

​

Reported net interest expense was $55.3 million and $70.4 million in the third quarter of 2025 and 2024, respectively, and $176.8 million and $220.8 million in the first nine months of 2025 and 2024. The decrease in net interest expense reflects the impact from lower interest rates and a higher cash balance.

​

​

Provision for Income Taxes

​

The following table provides a summary of our tax rate:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended					​	Nine Months Ended
​	​	September 30					​	September 30
(percent)		2025		​	2024			2025		​	2024
Reported GAAP tax rate	​	17.8	%	​	25.0	%	​	19.2	%	​	18.9	%
Tax rate impact of:	​	​	​	​	​	​	​	​	​	​	​	​
Special (gains) and charges		-	​	​	(2.9)	​	​	0.2	​	​	(1.6)
Discrete tax items		2.2	​	​	(2.4)	​	​	1.1	​	​	2.4
Non-GAAP adjusted tax rate		20.0	%	​	19.7	%		20.5	%	​	19.7	%

​

Our reported tax rate was 17.8% and 25.0% for the third quarter of 2025 and 2024, respectively, and 19.2% and 18.9% for the first nine months of 2025 and 2024, respectively. The change in our tax rate for the third quarter and first nine months versus the comparable periods of 2024 was driven primarily by discrete tax items and special (gains) and charges. The change in our tax rate includes the tax impact of special (gains) and charges and discrete tax items, which have impacted the comparability of our historical reported tax rates, as amounts included in our special (gains) and charges are derived from tax jurisdictions with rates that vary from our tax rate, and discrete tax items are not necessarily consistent across periods. The tax impact of special (gains) and charges and discrete tax items will likely continue to impact comparability of our reported tax rate in the future.

​

We recognized net tax benefits related to discrete tax items of $16.3 million and $21.8 million in the third quarter and first nine months of 2025, respectively. This included a tax benefit of $2.7 million and $12.6 million in the third quarter and first nine months of 2025, respectively, associated with share-based compensation excess tax benefits. The remaining net tax benefit of $13.6 million and $9.2 million in the third quarter and first nine months of 2025, respectively, was from the filing of tax returns, audit settlements, unrecognized tax benefits, and other changes in estimates.

​

We recognized net tax expense related to discrete tax items of $15.8 million and net tax benefit of $42.7 million in the third quarter and first nine months of 2024, respectively. This included a tax benefit of $41.9 million in the first nine months of 2024, associated with transferring certain intangible property between affiliates and $3.3 million and $15.6 million in the third quarter and first nine months of 2024, respectively, associated with share-based compensation excess tax benefits. The remaining net tax expense of $19.1 million and $14.8 million in the third quarter and first nine months of 2024, respectively, was from other income tax adjustments including the impact of provision to return adjustments, changes in tax laws, audit settlements, unrecognized tax benefits and other changes in estimates.

​

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. An estimate of the financial impact has been included in operating results as of September 30, 2025. The OBBBA did not have a material impact to our income tax expense.

​

The Organization for Economic Co-operation’s (“OECD”) global minimum tax regime (“Pillar Two”) is effective in certain countries where we operate. As such, an estimate of Pillar Two tax has been considered within the provision for income taxes. We continue to monitor these legislative developments, but based on information available we do not anticipate material impacts to the 2025 financial statements.

​

Net Income Attributable to Ecolab

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended											​	Nine Months Ended
​	​	September 30											​	September 30
(millions)		2025				2024			Change					2025				2024			Change
Reported GAAP net income attributable to Ecolab	​	​	$585.0	​	​	​	$736.5	​	​	(21)	%	​	​	​	$1,511.7	​	​	​	$1,639.5	​	​	(8)	%	​
Adjustments:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Special (gains) and charges, after tax	​		22.0	​	​	​	(230.3)	​	​	​	​	​	​	​	67.7	​	​	​	(206.3)	​	​	​	​	​
Discrete tax net expense	​		(16.3)	​	​	​	15.8	​	​	​	​	​	​	​	(21.8)	​	​	​	(42.7)	​	​	​	​	​
Non-GAAP adjusted net income attributable to Ecolab	​	​	$590.7	​	​	​	$522.0	​	​	13	%	​	​	​	$1,557.6	​	​	​	$1,390.5	​	​	12	%	​

​

Diluted EPS

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended											​	Nine Months Ended
​	​	September 30											​	September 30
(dollars)		2025				2024			Change					2025				2024			Change
Reported GAAP diluted EPS	​	​	$2.05	​	​	​	$2.58	​	​	(21)	%	​	​	​	$5.30	​	​	​	$5.72	​	​	(7)	%	​
Adjustments:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Special (gains) and charges, after tax	​		0.08	​	​	​	(0.81)	​	​	​	​	​	​	​	0.24	​	​	​	(0.72)	​	​	​	​	​
Discrete tax net expense	​		(0.06)	​	​	​	0.06	​	​	​	​	​	​	​	(0.08)	​	​	​	(0.15)	​	​	​	​	​
Non-GAAP adjusted diluted EPS	​	​	$2.07	​	​	​	$1.83	​	​	13	%	​	​	​	$5.46	​	​	​	$4.85	​	​	13	%	​

​

Per share amounts in the above tables do not necessary sum due to rounding.

​

Currency translation had a favorable impact of approximately $0.04 and an unfavorable impact of approximately ($0.01) per share on diluted EPS for the third quarter and first nine months of 2025, respectively, when compared to the comparable period of 2024.

​

SEGMENT PERFORMANCE

​

The non-U.S. dollar functional international amounts included within our reportable segments are based on translation into U.S. dollars at the fixed currency exchange rates used by management for 2025. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported as “effect of foreign currency translation” in the following tables. All other accounting policies of the reportable segments are consistent with U.S. GAAP and the accounting policies described in Note 2 of our Annual Report on Form 10-K for the year ended December 31, 2024. Additional information about our reportable segments is included in Note 15.

​

Fixed currency net sales and operating income for the third quarter and first nine months of 2025 for our reportable segments are shown in the following tables:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Net Sales	​	Third Quarter Ended										​	Nine Months Ended
​	​	September 30										​	September 30
(millions)		2025				2024		​	​	Change			2025				2024		​	​	Change
Global Water	​	​	$1,953.5	​		​	$1,897.6		​	3	%	​	​	$5,662.5	​		​	$5,515.8		​	3	%
Global Institutional & Specialty		​	1,544.8	​	​		1,525.7	​	​	1	​		​	4,463.0	​		​	4,520.7	​	​	(1)	​
Global Pest Elimination	​	​	322.6	​	​	​	301.7	​	​	7	​	​	​	912.0	​	​	​	852.2	​	​	7	​
Global Life Sciences	​	​	171.0	​	​	​	161.7	​	​	6	​	​	​	514.7	​	​	​	490.8	​	​	5	​
Subtotal at fixed currency		​	3,991.9	​	​		3,886.7	​	​	3	​		​	11,552.2	​	​		11,379.5	​	​	2	​
Effect of foreign currency translation		​	173.1	​	​		111.8	​	​	​	​		​	333.0	​	​		356.7	​	​	​	​
Consolidated reported GAAP net sales		​	$4,165.0	​	​	​	$3,998.5	​	​	4	%		​	$11,885.2	​	​	​	$11,736.2	​	​	1	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating Income	​	Third Quarter Ended										​	Nine Months Ended
​	​	September 30										​	September 30
(millions)	​	2025				2024		​	​	Change		​	2025				2024		​	​	Change
Global Water			$336.0	​		​	$324.8		​	3	%	​		$902.3	​		​	$857.0		​	5	%
Global Institutional & Specialty		​	365.0	​		​	327.6		​	11	​	​	​	1,023.0	​		​	914.5		​	12	​
Global Pest Elimination	​	​	67.4	​		​	60.5	​	​	11	​	​	​	174.7	​		​	167.0	​	​	5	​
Global Life Sciences		​	28.1	​		​	23.9		​	18	​	​	​	88.1	​		​	60.2		​	46	​
Corporate		​	(73.7)	​		​	282.4	​	​	​	​	​	​	(231.2)	​		​	141.7	​	​	​	​
Subtotal at fixed currency		​	722.8	​	​		1,019.2		​	(29)	​	​	​	1,956.9	​	​		2,140.4		​	(9)	​
Effect of foreign currency translation		​	37.4	​		​	25.6	​	​	​	​	​	​	68.7	​		​	79.2	​	​	​	​
Consolidated reported GAAP operating income			$760.2	​	​	​	$1,044.8		​	(27)	%	​		$2,025.6	​	​	​	$2,219.6		​	(9)	%

​

​

​

​

​

The following tables reconcile the impact of acquisitions and divestitures within our reportable segments:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended												​
​	​	September 30												​
Net Sales	​	2025					​	​	2024					​
(millions)		Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​	​	Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​
Global Water	​	$1,953.5	​	($24.1)	​	$1,929.4	​	​	$1,897.6	​	($5.0)	​	$1,892.6	​
Global Institutional & Specialty		1,544.8	​	(0.4)	​	1,544.4	​	​	1,525.7	​	(37.5)	​	1,488.2	​
Global Pest Elimination	​	322.6	​	(1.3)	​	321.3	​	​	301.7	​	-	​	301.7	​
Global Life Sciences		171.0	​	-	​	171.0	​	​	161.7	​	-	​	161.7	​
Subtotal at fixed currency		3,991.9	​	(25.8)	​	3,966.1	​	​	3,886.7	​	(42.5)	​	3,844.2	​
Effect of foreign currency translation		173.1	​	​	​	​	​	​	111.8	​	​	​	​	​
Consolidated reported GAAP net sales		$4,165.0	​	​	​	​	​	​	$3,998.5	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating Income	​	2025					​	​	2024					​
(millions)		Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​	​	Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​
Global Water	​	$336.0	​	($4.8)	​	$331.2	​	​	$324.8	​	($0.3)	​	$324.5	​
Global Institutional & Specialty		365.0	​	0.1	​	365.1	​	​	327.6	​	(10.4)	​	317.2	​
Global Pest Elimination	​	67.4	​	(0.2)	​	67.2	​	​	60.5	​	-	​	60.5	​
Global Life Sciences		28.1	​	-	​	28.1	​	​	23.9	​	-	​	23.9	​
Corporate		(49.1)	​	-	​	(49.1)	​	​	(49.3)	​	-	​	(49.3)	​
Non-GAAP adjusted fixed currency operating income		747.4	​	(4.9)	​	742.5	​	​	687.5	​	(10.7)	​	676.8	​
Special (gains) and charges		24.6	​	​	​	​	​	​	(331.7)	​	​	​	​	​
Subtotal at fixed currency		722.8	​	​	​	​	​	​	1,019.2	​	​	​	​	​
Effect of foreign currency translation		37.4	​	​	​	​	​	​	25.6	​	​	​	​	​
Consolidated reported GAAP operating income		$760.2	​	​	​	​	​	​	$1,044.8	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Nine Months Ended												​
​	​	September 30												​
Net Sales	​	2025					​	​	2024					​
(millions)		Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​	​	Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​
Global Water	​	$5,662.5	​	($67.6)	​	$5,594.9	​	​	$5,515.8	​	($24.6)	​	$5,491.2	​
Global Institutional & Specialty		4,463.0	​	(1.2)	​	4,461.8	​	​	4,520.7	​	(217.5)	​	4,303.2	​
Global Pest Elimination	​	912.0	​	(8.9)	​	903.1	​	​	852.2	​	-	​	852.2	​
Global Life Sciences		514.7	​	-	​	514.7	​	​	490.8	​	-	​	490.8	​
Subtotal at fixed currency		11,552.2	​	(77.7)	​	11,474.5	​	​	11,379.5	​	(242.1)	​	11,137.4	​
Effect of foreign currency translation		333.0	​	​	​	​	​	​	356.7	​	​	​	​	​
Consolidated reported GAAP net sales		$11,885.2	​	​	​	​	​	​	$11,736.2	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating Income	​	2025					​	​	2024					​
(millions)		Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​	​	Fixed Currency	​	Impact of Acquisitions and Divestitures	​	Organic	​
Global Water	​	$902.3	​	($8.8)	​	$893.5	​	​	$857.0	​	$0.4	​	$857.4	​
Global Institutional & Specialty		1,023.0	​	0.3	​	1,023.3	​	​	914.5	​	(52.9)	​	861.6	​
Global Pest Elimination		174.7	​	(0.6)	​	174.1	​	​	167.0	​	-	​	167.0	​
Global Life Sciences	​	88.1	​	-	​	88.1	​	​	60.2	​	-	​	60.2	​
Corporate		(145.9)	​	-	​	(145.9)	​	​	(147.2)	​	-	​	(147.2)	​
Non-GAAP adjusted fixed currency operating income		2,042.2	​	(9.1)	​	2,033.1	​	​	1,851.5	​	(52.5)	​	1,799.0	​
Special (gains) and charges		85.3	​	​	​	​	​	​	(288.9)	​	​	​	​	​
Subtotal at fixed currency		1,956.9	​	​	​	​	​	​	2,140.4	​	​	​	​	​
Effect of foreign currency translation		68.7	​	​	​	​	​	​	79.2	​	​	​	​	​
Consolidated reported GAAP operating income		$2,025.6	​	​	​	​	​	​	$2,219.6	​	​	​	​	​

​

Unless otherwise noted, the following segment performance commentary compares the third quarter and first nine months of 2025 against the third quarter and first nine months of 2024.

​

​

Global Water

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended							​	Nine Months Ended
​	​	September 30							​	September 30
​		2025			​	2024				2025			​	2024
Sales at fixed currency (millions)	​	​	$1,953.5	​	​	​	$1,897.6	​	​	​	$5,662.5	​	​	​	$5,515.8	​
Sales at public currency (millions)	​	​	2,054.6	​	​	​	1,966.4	​	​	​	5,858.3	​	​	​	5,741.4	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Organic sales change	​	​	2	%	​	​	​	​	​	​	2	%	​	​	​	​
Acquisitions and divestitures	​		1	%	​		​	​	​		1	%	​		​	​
Fixed currency sales change	​		3	%	​		​	​	​		3	%	​		​	​
Foreign currency translation	​	​	2	%	​	​	​	​	​	​	(1)	%	​	​	​	​
Public currency sales change	​		4	%	​		​	​	​		2	%	​		​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating income at fixed currency (millions)	​	​	$336.0	​	​	​	$324.8	​	​	​	$902.3	​	​	​	$857.0	​
Operating income at public currency (millions)	​	​	358.8	​	​	​	340.6	​	​	​	944.5	​	​	​	908.7	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Fixed currency operating income change	​	​	3	%	​	​	​	​	​	​	5	%	​	​	​	​
Fixed currency operating income margin	​		17.2	%	​		17.1	%	​		15.9	%	​		15.5	%
Organic operating income change	​		2	%	​		​	​	​		4	%	​		​	​
Organic operating income margin	​		17.2	%	​		17.1	%	​		16.0	%	​		15.6	%
Public currency operating income change	​	​	5	%	​	​	​	​	​	​	4	%	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

​

Percentages in the above table do not necessarily sum due to rounding.

​

Net Sales

​

Fixed currency sales increased 3% in both the third quarter and first nine months of 2025. Organic sales for Global Water increased 2% in both the third quarter and first nine months of 2025 driven by growth in Light & Heavy and Food & Beverage.

​

Light & Heavy organic sales increased 2% in both the third quarter and first nine months of 2025 driven by double-digit growth in high-tech and accelerating manufacturing sales growth, which more than offset continued soft end-market demand in basic industries. High-tech reported strong double-digit sales growth driven by data centers and microelectronics. Manufacturing reported accelerating growth driven by food & beverage. Downstream reported stable sales in North America, offset by softer sales in international regions. Basic Industries sales modestly declined as further new business wins were more than offset by continued soft end-market demand. Food ​& Beverage organic sales increased 4% and 3% in the third quarter and first nine months of 2025, respectively, driven by new business wins and value pricing. Paper organic sales decreased 4% and 2% in the third quarter and first nine months of 2025, respectively, as continued new business wins were offset by softer customer production rates.

​

Operating Income

​

Organic operating income and organic operating income margins increased for Global Water in the third quarter and first nine months of 2025.

​

Organic operating income margins increased 0.1 percentage points during the third quarter of 2025 as the 2.2 percentage point positive impact of value pricing, higher volumes and improved productivity were partially offset by the 1.6 percentage point impact of investments in the business. Organic operating income margins increased 0.4 percentage points during the first nine months of 2025 as the 1.1 percentage point positive impact of value pricing was partially offset by the 0.9 percentage point impact of investments in the business.

​

​

Global Institutional & Specialty

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended							​	Nine Months Ended
​	​	September 30							​	September 30
​		2025			​	2024				2025			​	2024
Sales at fixed currency (millions)	​	​	$1,544.8	​	​	​	$1,525.7	​	​	​	$4,463.0	​	​	​	$4,520.7	​
Sales at public currency (millions)	​	​	1,593.9	​	​	​	1,556.7	​	​	​	4,556.5	​	​	​	4,614.7	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Organic sales change	​	​	4	%	​	​	​	​	​	​	4	%	​	​	​	​
Acquisitions and divestitures	​		(2)	%	​		​	​	​		(5)	%	​		​	​
Fixed currency sales change	​		1	%	​		​	​	​		(1)	%	​		​	​
Foreign currency translation	​	​	1	%	​	​	​	​	​	​	-	%	​	​	​	​
Public currency sales change	​		2	%	​		​	​	​		(1)	%	​		​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating income at fixed currency (millions)	​	​	$365.0	​	​	​	$327.6	​	​	​	$1,023.0	​	​	​	$914.5	​
Operating income at public currency (millions)	​	​	375.2	​	​	​	334.7	​	​	​	1,041.1	​	​	​	934.0	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Fixed currency operating income change	​	​	11	%	​	​	​	​	​	​	12	%	​	​	​	​
Fixed currency operating income margin	​		23.6	%	​		21.5	%	​		22.9	%	​		20.2	%
Organic operating income change	​		15	%	​		​	​	​		19	%	​		​	​
Organic operating income margin	​		23.6	%	​		21.3	%	​		22.9	%	​		20.0	%
Public currency operating income change	​	​	12	%	​	​	​	​	​	​	11	%	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

​

Percentages in the above table do not necessarily sum due to rounding.

​

Net Sales

​

Fixed currency sales increased 1% and declined 1% in the third quarter and first nine months of 2025, respectively, due to the sale of Ecolab’s global surgical solutions business, which was sold in the third quarter of 2024. Organic sales for Global Institutional & Specialty increased 4% in both the third quarter and first nine months of 2025 with growth in both operating segments.

​

At an operating segment level, Institutional organic sales increased 3% in both the third quarter and first nine months of 2025, as growth in sales to hospitality customers was partially offset by modestly lower sales to hospitals. Specialty organic sales increased 7% and 5% in the third quarter and first nine months of 2025, respectively, reflecting strong growth, partially offset by an unfavorable impact from non-strategic, low margin business exits.

​

Operating Income

​

Organic operating income and organic operating income margin increased in the third quarter and first nine months of 2025 for our Global Institutional & Specialty segment.

​

Organic operating income margins increased 2.3 percentage points during the third quarter of 2025 as the 3.9 percentage point positive impact from value pricing, higher volumes and improved supply chain operations were partially offset by the 1.7 percentage point impact of investments in the business. Organic operating income margins increased 2.9 percentage points during the first nine months of 2025 as the 4.4 percentage point positive impact from value pricing, lower supply chain costs, and improved productivity were partially offset by the 1.3 percentage point impact of investments in the business.

​

​

Global Pest Elimination

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended							​	Nine Months Ended
​	​	September 30							​	September 30
​		2025			​	2024			​	2025			​	2024
Sales at fixed currency (millions)	​	​	$322.6	​	​	​	$301.7	​	​	​	$912.0	​	​	​	$852.2	​
Sales at public currency (millions)	​	​	331.8	​	​	​	307.2	​	​	​	929.8	​	​	​	869.0	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Organic sales change	​	​	6	%	​	​	​	​	​	​	6	%	​	​	​	​
Acquisitions and divestitures	​		-	%	​		​	​	​		1	%	​		​	​
Fixed currency sales change	​		7	%	​		​	​	​		7	%	​		​	​
Foreign currency translation	​	​	1	%	​	​	​	​	​	​	-	%	​	​	​	​
Public currency sales change	​		8	%	​		​	​	​		7	%	​		​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating income at fixed currency (millions)	​	​	$67.4	​	​	​	$60.5	​	​	​	$174.7	​	​	​	$167.0	​
Operating income at public currency (millions)	​	​	69.5	​	​	​	61.5	​	​	​	178.2	​	​	​	170.1	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Fixed currency operating income change	​	​	11	%	​	​	​	​	​	​	5	%	​	​	​	​
Fixed currency operating income margin	​		20.9	%	​		20.1	%	​		19.2	%	​		19.6	%
Organic operating income change	​		11	%	​		​	​	​		4	%	​		​	​
Organic operating income margin	​		20.9	%	​		20.1	%	​		19.3	%	​		19.6	%
Public currency operating income change	​	​	13	%	​	​	​	​	​	​	5	%	​	​	​	​

​

Percentages in the above table do not necessarily sum due to rounding.

​

Net Sales

​

Fixed currency sales increased 7% in both the third quarter and first nine months of 2025 reflecting a benefit from attractive, targeted acquisitions in North America. Organic sales for Global Pest Elimination increased 6% in both the third quarter and first nine months of 2025 driven by gains in food & beverage, restaurants, and healthcare.

​

Operating Income

​

Organic operating income increased for Global Pest Elimination in the third quarter and first nine months of 2025, respectively. Organic operating income margin increased in the third quarter of 2025 and decreased in the first nine months of 2025.

​

Organic operating income margins increased 0.8 percentage points during the third quarter of 2025, as the 3.9 percentage point positive impact from value pricing and higher volumes were partially offset by the 2.8 percentage point impact of investments in the business. Organic operating income margins decreased 0.3 percentage points during the first nine months of 2025, as the 3.7 percentage point positive impact from value pricing and higher volumes was more than offset by the 3.6 percentage point impact of investments in the business.

​

​

​

Global Life Sciences

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Third Quarter Ended							​	Nine Months Ended
​	​	September 30							​	September 30
​		2025			​	2024				2025			​	2024
Sales at fixed currency (millions)	​	​	$171.0	​	​	​	$161.7	​	​	​	$514.7	​	​	​	$490.8	​
Sales at public currency (millions)	​	​	184.7	​	​	​	168.2	​	​	​	540.6	​	​	​	511.1	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Organic sales change	​	​	6	%	​	​	​	​	​	​	5	%	​	​	​	​
Acquisitions and divestitures	​		-	%	​		​	​	​		-	%	​		​	​
Fixed currency sales change	​		6	%	​		​	​	​		5	%	​		​	​
Foreign currency translation	​	​	4	%	​	​	​	​	​	​	1	%	​	​	​	​
Public currency sales change	​		10	%	​		​	​	​		6	%	​		​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Operating income at fixed currency (millions)	​	​	$28.1	​	​	​	$23.9	​	​	​	$88.1	​	​	​	$60.2	​
Operating income at public currency (millions)	​	​	33.2	​	​	​	26.3	​	​	​	97.4	​	​	​	67.1	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Fixed currency operating income change	​	​	18	%	​	​	​	​	​	​	46	%	​	​	​	​
Fixed currency operating income margin	​		16.4	%	​		14.8	%	​		17.1	%	​		12.3	%
Organic operating income change	​		18	%	​		​	​	​		46	%	​		​	​
Organic operating income margin	​		16.4	%	​		14.8	%	​		17.1	%	​		12.3	%
Public currency operating income change	​	​	26	%	​	​	​	​	​	​	45	%	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

​

Percentages in the above table do not necessarily sum due to rounding.

​

Net Sales

​

Fixed currency and organic sales for Global Life Sciences increased 6% and 5% in the third quarter and first nine months of 2025, respectively, driven by new business wins and progressively improving industry trends. Continued growth in bioprocessing and pharmaceutical & personal care overcame ongoing capacity constraints within Life Sciences’ industrial water purification business.

​

Operating Income

​

Organic operating income and organic operating income margins increased in the third quarter and first nine months of 2025 for our Global Life Sciences segment.

​

Organic operating income margins increased 1.6 percentage points during the third quarter of 2025, as the 3.6 percentage point positive impact from value pricing and higher volumes were partially offset by the 2.5 percentage point impact of investments in the business. Organic operating income margins increased 4.8 percentage points during the first nine months of 2025, as the 5.6 percentage point positive impact from value pricing and lower delivered product cost were partially offset by the 0.8 percentage point impact of investments in the business.

​

​

Corporate

​

Consistent with our internal management reporting, Corporate amounts in the tables on pages 36 and 37 include intangible asset amortization specifically from the Nalco and Purolite transactions and special (gains) and charges that are not allocated to our reportable segments. Items included within special (gains) and charges are shown in the table on page 32.

​

​

​

FINANCIAL POSITION, CASH FLOWS AND LIQUIDITY

​

Financial Position

​

Total assets were $23.9 billion as of September 30, 2025 and $22.4 billion as of December 31, 2024.

​

Total liabilities were $14.2 billion as of September 30, 2025, compared to total liabilities of $13.6 billion as of December 31, 2024. Total debt was $8.1 billion as of September 30, 2025 and $7.6 billion as of December 31, 2024. See further discussion of our debt activity within the “Liquidity and Capital Resources” section of this MD&A.

​

Our net debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”) is shown in the following table. EBITDA is a non-GAAP measure discussed further in the “Non-GAAP Financial Measures” section of this MD&A.

​

The inputs to EBITDA reflect the trailing twelve months of activity for the period presented:

​

​	​	​	​	​	​	​	​	​
​	​	September 30, 2025				December 31, 2024
(ratio)	​	​	​	​	​	​	​	​
Net debt to EBITDA		​	1.7	​		​	1.7	​
​	​	​	​	​	​	​	​	​
(millions)		​	​	​	​	​	​	​
Total debt	​	​	$8,068.9	​	​	​	$7,564.9	​
Cash	​		1,955.8	​	​	​	1,256.8	​
Net debt	​	​	$6,113.1	​	​	​	$6,308.1	​
​	​	​	​	​	​	​	​	​
Net income including noncontrolling interest	​	​	$2,004.2	​	​	​	$2,131.9	​
Provision for income taxes	​		417.7	​	​	​	439.3	​
Interest expense, net	​		238.5	​	​	​	282.5	​
Depreciation	​		655.0	​	​	​	634.9	​
Amortization	​		300.8	​	​	​	300.5	​
EBITDA	​		$3,616.2	​	​	​	$3,789.1	​

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Cash Flows

​

Operating Activities

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Nine Months Ended
​	​	September 30
(millions)		2025			​	2024				Change
Cash provided by operating activities	​	​	$1,862.5	​	​	​	$2,047.2	​	​	​	($184.7)	​

​

We continue to generate cash flow from operations, allowing us to fund our ongoing operations, acquisitions, investments in the business and pension obligations along with returning cash to our shareholders through dividend payments and share repurchases. Cash provided by operating activities decreased by $185 million in the first nine months of 2025 compared to the first nine months of 2024, primarily driven by a $241 million unfavorable change in working capital. The cash flow impact from working capital was primarily driven by timing differences in accounts payable in the first nine months of 2025 versus the first nine months of 2024.

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Investing Activities

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Nine Months Ended
​	​	September 30
(millions)		2025			​	2024				Change
Cash (used for) provided by investing activities	​	​	($729.0)	​	​	​	$193.7	​	​	​	($922.7)	​

​

Cash (used for) provided by investing activities is primarily impacted by capital investments in the business. We continue to make capital investments in the business, including dispensing and monitoring equipment, manufacturing equipment and facilities. Total capital expenditures were $716 million and $635 million in the first nine months of 2025 and 2024, respectively.

​

Cash used for dispositions, net of cash divested in the first nine months of 2025 related to the divestiture of our global surgical solutions business was $15 million. Cash provided by dispositions, net of cash divested, during the first nine months of 2024 was $890 million. Cash used for acquisitions and investments in affiliates, net of cash acquired, during the first nine months of 2024 was $56 million.

​

​

Financing Activities

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Nine Months Ended
​	​	September 30
(millions)		2025			​	2024				Change
Cash used for financing activities	​	​	($421.7)	​	​	​	($1,884.0)	​	​	​	$1,462.3	​

​

Our cash flows from financing activities primarily reflect the issuances and repayment of debt, common stock repurchases, proceeds from common stock issuances related to our equity incentive programs and dividend payments.

We had net issuances of commercial paper and notes payable of $1 million and $3 million in the first nine months of 2025 and 2024, respectively.

Shares are repurchased for the purpose of partially offsetting the dilutive effect of our equity compensation plans, to manage our capital structure and to efficiently return capital to shareholders. We reacquired a total of $375 million and $984 million of shares in the first nine months of 2025 and 2024, respectively. Cash proceeds and tax benefits from stock option exercises provide a portion of the funding for repurchase activity.

We issued $1.0 billion of long-term debt and repaid €575 million ($674 million) of long-term debt in the first nine months of 2025. There was no long-term debt issuance activity and we repaid $630 million of long-term debt in the first nine months of 2024.

We paid dividends of $565 million and $503 million in the first nine months of 2025 and 2024, respectively.

​

Liquidity and Capital Resources

​

We currently expect to fund the cash requirements which are reasonably foreseeable for the next twelve months, including scheduled debt repayments, new investments in the business, share repurchases, dividend payments, possible business acquisitions and pension and postretirement contributions with cash from operating activities, and as needed, additional short-term and/or long-term borrowings. We continue to expect our operating cash flow to remain strong.

​

As of September 30, 2025, we had $1,956 million of cash and cash equivalents on hand, of which $582 million was held outside of the U.S. We will continue to evaluate our cash position in light of future developments.

​

As of December 31, 2024, we had a $2.0 billion multi-year revolving credit facility which was due to expire in April 2026. In March 2025, we entered into an amended and restated revolving credit facility which extended the maturity from April 2026 to March 2030. The credit facility has been established with a diverse syndicate of banks and supports our U.S. and Euro commercial paper programs. At the end of the third quarter of both 2025 and 2024, we had no outstanding commercial paper under our U.S. program nor our Euro program. There were no borrowings under our credit facility as of September 30, 2025 or December 31, 2024. As of September 30, 2025, both programs were rated A-2 by Standard & Poor’s, P-2 by Moody’s and F-1 by Fitch.

​

During the first nine months of 2025, we issued $500 million aggregate three-year fixed public notes with a coupon rate of 4.30% and an effective interest rate of 4.36%, and $500 million aggregate ten-year fixed public notes with a coupon rate of 5.00% and an effective interest rate of 5.05%. The proceeds will be used for general corporate purposes, which may include partial funding of the Ovivo Electronics acquisition. The Company repaid €575 million ($674 million) and $630 million of long-term debt during the first nine months of 2025 and 2024, respectively.

​

In June 2025, one of our Chinese subsidiaries entered into a construction loan facility that provides up to 1.1 billion in Chinese Yuan (“CNY”) ($157 million) of proceeds to fund capital expenditures. This loan facility has a tenor of 13 years and is secured by certain assets of our Chinese subsidiaries.

​

We are in compliance with our debt covenants and other requirements of our credit agreements and indentures. We believe we have sufficient borrowing capacity to meet our foreseeable operating activities, as needed.

​

The schedule of contractual obligations included in the Financial Position and Liquidity section of our Form 10-K for the year ended December 31, 2024 disclosed total notes payable and long-term debt due within one year of $616 million. As of September 30, 2025, the total notes payable and long-term debt due within one year was $16 million. We had no outstanding commercial paper under our U.S. program as of September 30, 2025 and as of December 31, 2024.

​

Our gross liability for unrecognized tax benefits was $44 million and $34 million as of September 30, 2025, and December 31, 2024, respectively. We are not able to reasonably estimate the amount by which the liability will increase or decrease over time; however, at this time, we do not expect significant payments related to these obligations within the next year.

​

​

​

​

GLOBAL ECONOMIC ENVIRONMENT

​

Global Economies

​

Approximately half of our sales are outside of the U.S. Our international operations subject us to changes in economic conditions and foreign currency exchange rates as well as political uncertainty in some countries which could impact future operating results. We expect the macroeconomic environment to remain challenging as a result of evolving international trade policies that could have a significant impact on costs and demand. We believe that the Company is well-prepared to manage through the dynamic international trade environment, given our “local-for-local” production model and our recently implemented trade surcharge.

​

Argentina, Turkey and Egypt are classified as highly inflationary economies in accordance with U.S. GAAP, and the U.S. dollar is the functional currency for our subsidiaries in Argentina, Turkey and Egypt. During the first nine months of 2025, sales in Argentina, Turkey and Egypt represented approximately 1% of our consolidated sales. Assets held in Argentina, Turkey and Egypt at the end of the first nine months of 2025 represented approximately 1% of our consolidated assets.

​

In light of Russia’s invasion of Ukraine and the sanctions against Russia by the United States and other countries, we have made the determination that we will limit our Russian business to operations that are essential to life, providing minimal support for our healthcare, life sciences, food and beverage and certain water businesses. We may further narrow our presence in Russia depending on future developments. During the first nine months of 2025, our Russian and Ukraine operations represented less than 1% of our 2025 consolidated net sales.

​

​

NEW ACCOUNTING PRONOUNCEMENTS

​

For information on new accounting pronouncements, refer to Note 17 to the Consolidated Financial Statements.

​

NON-GAAP FINANCIAL MEASURES

​

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in Item 2, contains financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (GAAP). These non-GAAP measures include:

	●	Fixed currency sales

	●	Organic sales

	●	Adjusted cost of sales

	●	Adjusted gross margin

	●	Fixed currency operating income

	●	Fixed currency operating income margin

	●	Adjusted operating income

	●	Adjusted operating income margin

	●	Adjusted fixed currency operating income

	●	Adjusted fixed currency operating income margin

	●	Organic operating income

	●	Organic operating income margin

	●	EBITDA

	●	Adjusted tax rate

	●	Adjusted net income attributable to Ecolab

	●	Adjusted diluted EPS

​

We provide these measures as additional information regarding our operating results. We use these non-GAAP measures internally to evaluate our performance and in making financial and operational decisions, including with respect to incentive compensation. We believe that our presentation of these measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparison of results.

​

Our non-GAAP adjusted financial measures for cost of sales, gross margin and operating income exclude the impact of special (gains) and charges and our non-GAAP adjusted financial measures for tax rate, net income attributable to Ecolab and diluted earnings per share further exclude the impact of discrete tax items. We include items within special (gains) and charges and discrete tax items that we believe can significantly affect the period-over-period assessment of operating results and not necessarily reflect costs and/or income associated with historical trends and future results. After tax special (gains) and charges are derived by applying the applicable local jurisdictional tax rate to the corresponding pre-tax special (gains) and charges.

​

​

​

EBITDA is defined as net income including noncontrolling interest with the sum of provision for income taxes, net interest expense, depreciation and amortization added back. EBITDA is used in our net debt to EBITDA ratio, which we view as important indicators of the operational and financial health of our organization.

We evaluate the performance of our international operations based on fixed currency rates of foreign exchange. Fixed currency amounts included in this Form 10-Q are based on translation into U.S. dollars at the fixed foreign currency exchange rates established by management at the beginning of 2025. We also provide our segment results based on public currency rates for informational purposes.

​

Our reportable segments do not include the impact of intangible asset amortization from the Nalco and Purolite transactions or the impact of special (gains) and charges as these are not allocated to our reportable segments.

​

Our non-GAAP financial measures for organic sales, organic operating income and organic operating income margin are at fixed currency and exclude the impact of special (gains) and charges, the results of our acquired businesses from the first twelve months post acquisition and the results of divested businesses from the twelve months prior to divestiture. Further, due to the sale of the global surgical solutions business on August 1, 2024, we have excluded the results of the business for the nine-month period ended September 30, 2024 from these organic measures to remain comparable to the corresponding period in 2025. In addition, as part of the separation of ChampionX in 2020, we continue to provide certain products to ChampionX, which are recorded in product and equipment sales in the Global Water segment along with the related cost of sales. These transactions are removed from the consolidated results as part of the calculation of the impact of acquisitions and divestitures.

​

These non-GAAP measures are not in accordance with, or an alternative to U.S. GAAP, and may be different from non-GAAP measures used by other companies. Investors should not rely on any single financial measure when evaluating our business. We recommend that investors view these measures in conjunction with the U.S. GAAP measures included in this MD&A and we have provided reconciliations of reported U.S. GAAP amounts to the non-GAAP amounts.

​

​

FORWARD-LOOKING STATEMENTS

​

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include our business performance and prospects; expectations concerning timing, amount and type of restructuring costs and savings from restructuring activities; Russian operations; working capital; capital investments, acquisitions and share repurchases; amortization expense; non-performance of financial counterparties; payments and contributions to pension and postretirement health care benefit plans; the impact of lawsuits, claims and environmental matters; impact of new accounting pronouncements and tax laws; cash flows, borrowing capacity and funding of cash requirements, including repayment of debt; payments related to uncertain tax positions; and implementation of ERP system upgrade.

​

Without limiting the foregoing, words or phrases such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “we believe,” “we expect,” “estimate,” “project” (including the negative or variations thereof) or similar terminology, generally identify forward-looking statements. Forward-looking statements may also represent challenging goals for us. These statements, which represent our expectations or beliefs concerning various future events, are based on current expectations that involve a number of risks and uncertainties that could cause actual results to differ materially from those of such forward-looking statements. In particular, the ultimate results of any restructuring or efficiency initiative, integration and business improvement actions, including cost synergies, depend on a number of factors, including the development of final plans, the impact of local regulatory requirements regarding employee terminations, the time necessary to develop and implement the restructuring or efficiency initiative and other business improvement initiatives and the level of success achieved through such actions in improving competitiveness, efficiency and effectiveness. We caution that undue reliance should not be placed on such forward-looking statements, which speak only as of the date made.

​

​

Some of the factors which could cause results to differ materially from those expressed in any forward-looking statements are set forth under Item 1A of our most recent Form 10-K and our other public filings with the Securities and Exchange Commission (the "SEC"), and include the impact of economic factors such as the worldwide economy, interest rates, foreign currency risk, reduced sales and earnings in our international operations resulting from the weakening of local currencies versus the U.S. dollar, demand uncertainty, supply chain challenges and inflation; the vitality of the markets we serve; exposure to global economic, political and legal risks related to our international operations, including international trade policies, geopolitical instability and the escalation of armed conflicts; our ability to successfully execute organizational change and management transitions; information technology infrastructure failures or breaches in data security; difficulty in procuring raw materials or fluctuations in raw material costs; the occurrence of severe public health outbreaks not limited to COVID-19; our ability to acquire complementary businesses and to effectively integrate such businesses; our ability to execute key business initiatives; our ability to successfully compete with respect to value, innovation and customer support; our increasing reliance on artificial intelligence technologies in our products, services and operations; pressure on operations from consolidation of customers or vendors; restraints on pricing flexibility due to contractual obligations and our ability to meet our contractual commitments; the costs and effects of complying with laws and regulations, including those relating to the environment, climate change standards, and to the manufacture, storage, distribution, sale and use of our products, as well as to the conduct of our business generally, including labor and employment and anti-corruption; potential chemical spill or release; our commitments, goals, targets, objectives and initiatives related to sustainability; potential to incur significant tax liabilities or indemnification liabilities relating to the separation and split-off of our ChampionX business; the occurrence of litigation or claims, including class action lawsuits; the loss or insolvency of a major customer or distributor; repeated or prolonged government and/or business shutdowns or similar events; acts of war or terrorism; natural or man-made disasters; water shortages; severe weather conditions; changes in tax laws and unanticipated tax liabilities; potential loss of deferred tax assets; our indebtedness, and any failure to comply with covenants that apply to our indebtedness; potential losses arising from the impairment of goodwill or other assets; and other uncertainties or risks reported from time to time in our reports to the SEC. There can be no assurances that our earnings levels will meet investors’ expectations. Except as may be required under applicable law, we do not undertake, and expressly disclaim, any duty to update our Forward-Looking Statements.

​

​