Item 1. FINANCIAL STATEMENTS.

119K characters. Original on sec.gov · Markdown

Item 1. FINANCIAL STATEMENTS.

REPUBLIC SERVICES, INC.

CONSOLIDATED BALANCE SHEETS

(in millions, except per share data)


	March 31,		December 31,
	2026		2025
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	118	$	76
Accounts receivable, less allowance for doubtful accounts and other of $60 and $66, respectively	1,917		1,897
Prepaid expenses and other current assets	475		550

Total current assets	2,510		2,523
Restricted cash and marketable securities	292		259
Property and equipment, net	12,695		12,639
Goodwill	16,926		16,715
Other intangible assets, net	647		655
Other assets	1,530		1,575
Total assets	$	34,600	$	34,366
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,196	$	1,374
Notes payable and current maturities of long-term debt	547		596
Deferred revenue	480		496
Accrued landfill and environmental costs, current portion	159		148
Accrued interest	122		109
Other accrued liabilities	1,236		1,205
Total current liabilities	3,740		3,928
Long-term debt, net of current maturities	13,317		12,985
Accrued landfill and environmental costs, net of current portion	2,620		2,608
Deferred income taxes and other long-term tax liabilities, net	1,936		1,884
Insurance reserves, net of current portion	454		436
Other long-term liabilities	552		556
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.01 per share; 50 shares authorized; none issued	—		—
Common stock, par value $0.01 per share; 750 shares authorized; 314 and 313 issued including shares held in treasury, respectively	3		3
Additional paid-in capital	1,851		1,833
Retained earnings	11,493		11,161
Treasury stock, at cost; 6 and 5 shares, respectively	(1,336)		(1,000)
Accumulated other comprehensive loss, net of tax	(31)		(29)
Total Republic Services, Inc. stockholders’ equity	11,980		11,968
Non-controlling interests in consolidated subsidiary	1		1
Total stockholders’ equity	11,981		11,969
Total liabilities and stockholders’ equity	$	34,600	$	34,366

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per share data)


	Three Months Ended March 31,
	2026		2025
Revenue	$	4,113	$	4,009
Expenses:
Cost of operations	2,366		2,314
Depreciation, depletion and amortization	461		434
Accretion	30		28
Selling, general and administrative	425		427

Restructuring charges	2		4
Gain on business divestitures and impairments, net	(1)		(2)
Operating income	830		804
Interest expense	(151)		(140)

Loss from unconsolidated equity method investments	(52)		(12)
Interest income	2		2
Other income, net	27		11
Income before income taxes	656		665
Provision for income taxes	131		170
Net income	525		495
Net income attributable to non-controlling interests in consolidated subsidiary	—		—
Net income attributable to Republic Services, Inc.	$	525	$	495
Basic earnings per share attributable to Republic Services, Inc. stockholders:
Basic earnings per share	$	1.70	$	1.58
Weighted average common shares outstanding	309.1		313.0
Diluted earnings per share attributable to Republic Services, Inc. stockholders:
Diluted earnings per share	$	1.70	$	1.58
Weighted average common and common equivalent shares outstanding	309.3		313.3
Cash dividends per common share	$	0.625	$	0.580

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)


	Three Months Ended March 31,
	2026		2025
Net income	$	525	$	495











Other comprehensive loss, net of tax	(2)		(5)
Comprehensive income	523		490
Comprehensive income attributable to non-controlling interests	—		—
Comprehensive income attributable to Republic Services, Inc.	$	523	$	490

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions)


	Republic Services, Inc. Stockholders’ Equity
	Common Stock			Additional Paid-In Capital		Retained Earnings		Treasury Stock			Accumulated Other Comprehensive Loss, Net of Tax		Non-controlling Interests In Consolidated Subsidiary
	Shares	Amount				Shares		Amount			Total
Balance as of December 31, 2025	313	$	3	$	1,833	$	11,161	(5)	$	(1,000)	$	(29)	$	1	$	11,969

Net income	—	—		—		525		—	—		—		—		525
Other comprehensive loss	—	—		—		—		—	—		(2)		—		(2)
Cash dividends declared	—	—		—		(192)		—	—		—		—		(192)
Issuances of common stock	1	—		5		—		—	(19)		—		—		(14)
Stock-based compensation	—	—		13		(1)		—	—		—		—		12
Purchase of common stock for treasury	—	—		—		—		(1)	(317)		—		—		(317)

Balance as of March 31, 2026	314	3		1,851		11,493		(6)	(1,336)		(31)		1		11,981


	Republic Services, Inc. Stockholders’ Equity
	Common Stock			Additional Paid-In Capital		Retained Earnings		Treasury Stock			Accumulated Other Comprehensive Loss, Net of Tax		Non-controlling Interests In Consolidated Subsidiary
	Shares	Amount				Shares		Amount			Total
Balance as of December 31, 2024	313	$	3	$	1,767	$	9,774	(1)	$	(113)	$	(26)	$	2	$	11,407

Net income	—	—		—		495		—	—		—		—		495
Other comprehensive loss	—	—		—		—		—	—		(5)		—		(5)
Cash dividends declared	—	—		—		(181)		—	—		—		—		(181)
Issuances of common stock	—	—		3		—		—	(22)		—		—		(19)
Stock-based compensation	—	—		14		(1)		—	—		—		—		13
Purchase of common stock for treasury	—	—		—		—		—	(45)		—		—		(45)

Balance as of March 31, 2025	313	3		1,784		10,087		(1)	(180)		(31)		2		11,665

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)


	Three Months Ended March 31
	2026		2025
Cash provided by operating activities:
Net income	$	525	$	495
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation, depletion, amortization and accretion	491		462
Non-cash interest expense	21		18


Deferred tax provision	33		1





Loss from unconsolidated equity method investments	52		12

Other non-cash items	22		18
Change in assets and liabilities, net of effects from business acquisitions and divestitures:
Accounts receivable	(25)		(18)
Prepaid expenses and other assets	49		90
Accounts payable	49		(42)

Capping, closure and post-closure expenditures	(9)		(8)
Remediation expenditures	(11)		(9)
Other liabilities	30		6

Cash provided by operating activities	1,227		1,025
Cash used in investing activities:
Purchases of property and equipment	(476)		(459)
Proceeds from sales of property and equipment	3		3
Cash used in acquisitions and investments, net of cash and restricted cash acquired	(437)		(834)
Cash received from business divestitures	1		3


Other	(1)		(1)
Cash used in investing activities	(910)		(1,288)
Cash (used in) provided by financing activities:
Proceeds from credit facilities and notes payable, net of fees	15,310		11,372
Proceeds from issuance of senior notes, net of discount and fees	—		1,186
Payments of credit facilities and notes payable	(15,035)		(12,018)


Issuances of common stock, net	(14)		(19)

Purchases of common stock for treasury	(292)		(55)
Cash dividends paid	(193)		(181)

Contingent consideration payments	(14)		(1)
Cash (used in) provided by financing activities	(238)		284
Effect of foreign exchange rate changes on cash	(1)		—
Increase in cash, cash equivalents, restricted cash and restricted cash equivalents	78		21
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period	249		203
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period	$	327	$	224

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

Republic Services, Inc., a Delaware corporation, and its consolidated subsidiaries (also referred to collectively as Republic, the Company, we, us, or our), is one of the largest providers of environmental services in the United States, as measured by revenue. Our senior management evaluates, oversees and manages the financial performance of our operations through three field groups, referred to as Group 1, Group 2 and Group 3. Group 1 is our recycling and waste business operating primarily in geographic areas located in the western United States. Group 2 is our recycling and waste business operating primarily in geographic areas located in the southeastern and mid-western United States, the eastern seaboard of the United States, and Canada. Group 3 is our environmental solutions business operating in geographic areas located across the United States and Canada. These groups represent our reportable segments, which each provide integrated environmental services, including but not limited to collection, transfer, recycling and disposal.

The unaudited consolidated financial statements include the accounts of Republic Services, Inc. and its wholly owned and majority owned subsidiaries in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). We account for investments in entities in which we do not have a controlling financial interest under the equity method of accounting or, for investments that do not meet the criteria to be accounted for under the equity method, we reflect these investments at their fair value when it is readily determinable. If fair value is not readily determinable, we use an alternative measurement approach. All material intercompany accounts and transactions have been eliminated in consolidation.

We have prepared these unaudited consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. In the opinion of management, these financial statements include all adjustments that, unless otherwise disclosed, are of a normal recurring nature and necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. Operating results for interim periods are not necessarily indicative of the results you can expect for a full year. You should read these financial statements in conjunction with our audited consolidated financial statements and notes thereto appearing in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

For comparative purposes, certain prior year amounts have been reclassified to conform to the current year presentation and are not material to our consolidated financial statements. All dollar amounts in tabular presentations are in millions, except per share amounts and unless otherwise noted.

Management’s Estimates and Assumptions

In preparing our financial statements, we make numerous estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes. We must make these estimates and assumptions because certain information we use is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies. In preparing our financial statements, the more significant and subjective areas that deal with the greatest amount of uncertainty relate to our accounting for our long-lived assets, including recoverability, landfill development costs and final capping, closure and post-closure costs; our liabilities for potential litigation, claims and assessments; our liabilities for environmental remediation, deferred taxes, uncertain tax positions and insurance reserves; and our estimates of the fair values of assets acquired and liabilities assumed in acquisitions. For more detail on significant accounting policies, refer to Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Our actual results may differ significantly from our estimates.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

New Accounting Pronouncements

Accounting Standards Adopted

Measurement of Credit Losses for Accounts Receivable and Contract Assets

In July 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2025‑05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (ASU 2025‑05), which simplifies the application of the current expected credit loss model for current accounts receivable and current contract assets under Topic 606. In developing reasonable and supportable forecasts as part of estimating expected credit losses, the amendments in this update provide entities with a practical expedient that assumes that the current conditions as of the balance sheet date do not change for the remaining life of the asset. The Company adopted ASU 2025-05 and elected this practical expedient on January 1, 2026. The election of this practical expedient did not have a material impact on our consolidated financial statements.

Accounting Standards Updates Issued but not yet Adopted

Codification Improvements

In December 2025, the FASB issued Accounting Standards Update 2025-12, Codification Improvements: The amendments from this ASU address a range of accounting topics and clarify or make minor improvements to the existing codification. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted. We are currently assessing the effect this guidance may have on our consolidated financial statements.

Narrow-Scope Improvements

In December 2025, the FASB issued Accounting Standards Update 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This guidance clarifies interim disclosure requirements and the applicability of Topic 270, resulting in a comprehensive list of interim disclosures required by GAAP and a disclosure principle for disclosing material events since the last reporting period. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. We are currently assessing the effect this guidance may have on our consolidated financial statements.

Accounting for Government Grants Received by Business Entities

In December 2025, the FASB issued Accounting Standards Update 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This ASU adds guidance to Accounting Standards Codification (ASC) 832 on the recognition, measurement, and presentation of government grants. In the absence of such guidance, many for-profit entities historically have analogized to other GAAP, including International Accounting Standards (IAS) 20 or ASC 958-605, when accounting for government grants. This ASU will be effective for annual and interim periods in fiscal years beginning after December 15, 2028. We are currently assessing the effect this guidance may have on our consolidated financial statements.

Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued Accounting Standards Update 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This guidance removes references to prescriptive and sequential development stages, requiring companies to capitalize internal-use software costs when management commits to funding the software project and it is probable the project will be completed. The amendments are effective for annual reporting periods beginning after December 15, 2027 and interim reporting periods within those annual reporting periods. Entities may apply the guidance using a prospective, retrospective or modified transition approach. We are currently assessing the effect this guidance may have on our consolidated financial statements.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). ASU 2024-03 requires an entity to disclose the amount of purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. It also requires an entity to include certain amounts that are already required to be disclosed under GAAP in the same disclosure. Additionally, it requires an entity to disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and to disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. An

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

entity may apply the amendments prospectively for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. We are currently assessing the effect this guidance may have on our consolidated financial statements.

Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative

In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, to modify the disclosure or presentation requirements of a variety of topics, which will allow users to more easily compare entities subject to the SEC's existing disclosures with those entities that were not previously subject to the SEC's requirements, and to align the requirements in the FASB accounting standard codification with the SEC's regulations. The effective date for each topic's amendment is the date on which the SEC's removal of the topic's related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

2. BUSINESS ACQUISITIONS, INVESTMENTS AND RESTRUCTURING CHARGES

Acquisitions

We acquired various environmental services businesses during the three months ended March 31, 2026 and 2025. The aggregate purchase price paid for these business acquisitions and the allocations of the aggregate purchase price follows:


	2026		2025
Purchase price:
Cash used in acquisitions, net of cash acquired of $— and $7, respectively	$	429	$	819

Holdbacks	4		7


Total	$	433	$	826
Allocated as follows:

Accounts receivable	$	7	$	27


Property and equipment	206		124



Other assets	1		14

Accounts payable	(1)		(5)

Accrued landfill and environmental costs	(10)		(12)



Other liabilities	(6)		(28)
Fair value of tangible assets acquired and liabilities assumed	197		120
Excess purchase price to be allocated	$	236	$	706
Excess purchase price allocated as follows:
Other intangible assets	$	18	$	108
Goodwill	218		598

Total allocated	$	236	$	706

Certain of the purchase price allocations are preliminary and based on information existing at the acquisition dates. Accordingly, the purchase price allocations are subject to change. For the acquisitions that closed during the three months ended March 31, 2026, we expect that a majority of the goodwill and intangible assets recognized as a result of these acquisitions will be deductible for tax purposes.

These acquisitions are not material to the Company's results of operations, individually or in the aggregate. As a result, no pro forma financial information is provided.

In February 2026, we acquired certain assets and assumed certain liabilities from Hamm, LLC, N.R. Hamm Quarry, LLC, N.R. Hamm Contractor, LLC, and Cornejo & Sons, LLC constituting a vertically-integrated recycling and waste business located in Kansas. The purchase price allocation is preliminary and remains subject to revision as additional information is obtained about the facts and circumstances that existed at the valuation date. The preliminary allocation of purchase price, including the value assigned to certain tangible assets acquired as well as certain landfill and environmental liabilities assumed, is based on the best estimates of management and is subject to revision based on the final valuations. We expect our valuations to be substantially complete by the end of 2026.

In May 2026, we acquired the equity interests of Robinson Waste Holdings Group, LLC (Robinson). Robinson's vertically integrated recycling and waste services operations are located in Utah and complement Republic's existing core competencies and expertise in the environmental services industry.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Investments

We invest in non-controlling equity interests in certain limited liability companies that qualify for investment tax credits under Section 48 of the Internal Revenue Code. We account for these investments under the equity method of accounting utilizing the Hypothetical Liquidation at Book Value ("HLBV") method. During the three months ended March 31, 2026 and 2025, we decreased the carrying value of these investments by $43 million and $8 million, respectively, as a result of our share of income and loss pursuant to the terms of the limited liability company agreements. Additionally, our tax provision reflects a benefit of approximately $37 million for the three months ended March 31, 2026, due to tax credits net of nondeductible items, related to these investments. No benefit was recognized in our tax provision for the three months ended March 31, 2025. For further discussion of the income tax benefits, refer to Note 11, Income Taxes, in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2025.

In 2022, we acquired a non-controlling equity interest in a joint venture with a landfill gas-to-energy developer to construct renewable natural gas projects at our landfills across the United States. Certain of these investments qualified for investment tax credits under Section 48 of the Internal Revenue Code. As of March 31, 2026 and December 31, 2025, our carrying value in the joint venture was approximately $312 million and $314 million, respectively. The investment is accounted for under the equity method of accounting.

In 2022, we acquired a non-controlling equity interest in Blue Polymers, LLC, a joint venture with Ravago, intended to help create vertical integration in the recycling market, and to further advance circularity by acquiring all olefins produced by the Company's Polymer Centers and producing custom blended pellets for food-grade and non-food-grade packaging. As of March 31, 2026 and December 31, 2025, our carrying value in the joint venture was $95 million and $101 million, respectively. This investment is an unconsolidated VIE for which we do not have the power to direct the significant activities of the business, and it is accounted for under the equity method of accounting. Our risk of loss is materially consistent with our contributions to date.

These investments were recorded as other assets in our unaudited consolidated balance sheet as of March 31, 2026.

Restructuring Charges

During the three months ended March 31, 2026 and 2025, we incurred restructuring charges of $2 million and $4 million, respectively. The charges related to the design and implementation of our new accounts receivable system. During the three months ended March 31, 2026 and 2025, we paid $4 million and $3 million, respectively, related to these restructuring efforts.

3. GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Goodwill

A summary of the activity and balances in goodwill accounts by reporting segment follows:


	Balance as of December 31, 2025		Acquisitions		Divestitures		Adjustments and Other		Balance as of March 31, 2026
Group 1	$	7,573	$	137	$	—	$	—	$	7,710
Group 2	6,597		56		—		(7)		6,646
Group 3	2,545		25		—		—		2,570
Total	$	16,715	$	218	$	—	$	(7)	$	16,926

Other Intangible Assets, Net

Other intangible assets, net, is primarily comprised of values assigned to customer relationships, which are amortized over periods ranging from 1 to 15 years. A summary of the activity and balances by intangible asset type follows:


	Gross Intangible Assets								Accumulated Amortization
	Balance as of December 31, 2025		Acquisitions		Adjustments and Other		Balance as of March 31, 2026		Balance as of December 31, 2025		Additions Charged to Expense		Adjustments and Other		Balance as of March 31, 2026		Other Intangible Assets, Net as of March 31, 2026
Customer relationships	$	881	$	17	$	(3)	$	895	$	(289)	$	(21)	$	—	$	(310)	$	585

Other intangible assets	84		1		—		85		(21)		(2)		—		(23)		62
Total	$	965	$	18	$	(3)	$	980	$	(310)	$	(23)	$	—	$	(333)	$	647

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

4. OTHER ASSETS

Prepaid Expenses and Other Current Assets

A summary of prepaid expenses and other current assets as of March 31, 2026 and December 31, 2025 follows:


	2026		2025
Parts and supplies	$	114	$	106
Prepaid expenses	108		131

Income taxes receivable	89		146
Other non-trade receivables	77		94

Reinsurance receivable	31		32
Other	56		41
Total	$	475	$	550

Other Assets

A summary of other assets as of March 31, 2026 and December 31, 2025 follows:


	2026		2025
Investments	$	769	$	815
Operating right-of-use lease assets	207		208
Prepaid fees and capitalized implementation costs for cloud-based hosting arrangements	164		159
Deferred compensation plan	140		143
Reinsurance receivable, net of current	89		90
Deferred contract costs and sales commissions	78		81
Derivative and hedging assets	36		32

Other	47		47
Total	$	1,530	$	1,575

5. OTHER LIABILITIES

Other Accrued Liabilities

A summary of other accrued liabilities as of March 31, 2026 and December 31, 2025 follows:


	2026		2025
Accrued payroll and benefits	$	286	$	313
Insurance reserves, current	253		251
Accrued fees and taxes	227		214
Accrued dividends	192		193
Operating right-of-use lease liabilities, current	49		48
Accrued professional fees and legal settlement reserves	34		32

Ceded insurance reserves, current	31		32
Contingent purchase price and acquisition holdbacks	14		25
Other	150		97
Total	$	1,236	$	1,205

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Other Long-Term Liabilities

A summary of other long-term liabilities as of March 31, 2026 and December 31, 2025 follows:


	2026		2025
Operating right-of-use lease liabilities	$	174	$	177
Deferred compensation plan liability	128		125
Ceded insurance reserves	89		90
Contingent purchase price and acquisition holdbacks	58		59
Derivative and hedging liabilities	49		46
Withdrawal liability - multiemployer pension funds	20		20

Other	34		39
Total	$	552	$	556

6. LANDFILL AND ENVIRONMENTAL COSTS

As of March 31, 2026, we owned or operated 209 active landfills, and we had post-closure responsibility for 124 closed landfills.

Accrued Landfill and Environmental Costs

A summary of accrued landfill and environmental liabilities as of March 31, 2026 and December 31, 2025 follows:


	2026		2025
Landfill final capping, closure and post-closure liabilities	$	2,339	$	2,313
Environmental remediation	440		443
Total accrued landfill and environmental costs	2,779		2,756
Less: current portion	(159)		(148)
Long-term portion	$	2,620	$	2,608

Final Capping, Closure and Post-Closure Costs

The following table summarizes the activity in our asset retirement obligation liabilities, which includes liabilities for final capping, closure and post-closure, for the three months ended March 31, 2026 and 2025:


	2026		2025
Asset retirement obligation liabilities, beginning of year	$	2,313	$	2,144
Non-cash additions	15		17
Acquisitions, net of divestitures and other adjustments	7		—
Asset retirement obligation adjustments	(17)		—
Payments	(9)		(8)
Accretion expense	30		28

Asset retirement obligation liabilities, end of period	2,339		2,181
Less: current portion	(97)		(97)
Long-term portion	$	2,242	$	2,084

We review annually, in the fourth quarter, and update as necessary, our estimates of asset retirement obligation liabilities. However, if there are significant changes in the facts and circumstances related to a site during the year, we will update our assumptions prospectively in the period that we know all the relevant facts and circumstances and make adjustments as appropriate.

Landfill Operating Expenses

In the normal course of business, we incur various operating costs associated with environmental compliance. These costs include, among other things, leachate treatment and disposal, methane gas and groundwater monitoring, systems maintenance, interim cap maintenance, costs associated with the application of daily cover materials, and the legal and administrative costs of ongoing environmental compliance. These costs are expensed as cost of operations in the periods in which they are incurred.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Environmental Remediation Liabilities

We accrue for remediation costs when they become probable and can be reasonably estimated. There can sometimes be a range of reasonable estimates of the costs associated with remediation of a site. In these cases, we use the amount within the range that constitutes our best estimate. If no amount within the range appears to be a better estimate than any other, we use the amount that is at the low end of such range. It is reasonably possible that we will need to adjust the liabilities recorded for remediation to reflect the effects of new or additional information, to the extent such information impacts the costs, timing or duration of the required actions. If we used the reasonably possible high ends of our ranges, our aggregate potential remediation liability as of March 31, 2026 would be approximately $276 million higher than the amount recorded. Future changes in our estimates of the cost, timing or duration of the required actions could have a material adverse effect on our consolidated financial position, results of operations and cash flows.

The following table summarizes the activity in our environmental remediation liabilities for the three months ended March 31, 2026 and 2025:


	2026		2025
Environmental remediation liabilities, beginning of year	$	443	$	447

Payments	(11)		(9)
Accretion expense (non-cash interest expense)	4		5
Acquisitions, net of divestitures and other adjustments	4		12
Environmental remediation liabilities, end of period	440		455
Less: current portion	(62)		(62)
Long-term portion	$	378	$	393

West Lake Landfill Superfund Site. Our subsidiary Bridgeton Landfill, LLC is one of several currently designated Potentially Responsible Parties for the West Lake Landfill Superfund site (West Lake) in Missouri. On September 27, 2018, the United States Environmental Protection Agency (EPA) issued a Record of Decision Amendment for West Lake that includes a total undiscounted cost estimate of $229 million over a four to five year design and construction timeline. On March 11, 2019, the EPA issued special notice letters under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) to Bridgeton Landfill, LLC and the other currently designated Potentially Responsible Parties to initiate negotiations to implement the remedy. On January 17, 2025, the EPA issued an Explanation of Significant Differences (ESD) applying the prior Record of Decision Amendment to an increased number of acres at the site found to contain radiologically-impacted material. The ESD includes a revised undiscounted cost estimate of $392 million. At this time we are neither able to predict the final design of that remedy, nor estimate how much of the future response costs of the site our subsidiary may agree or be required to pay. During any subsequent administrative proceedings or litigation, our subsidiary will vigorously contest liability for the costs of remediating radiologically-impacted materials generated on behalf of the federal government during the Manhattan Project and delivered to the site by an Atomic Energy Commission licensee and its subcontractor. However, subsequent events related to remedy design, divisibility, or allocation may require us to modify our expected remediation liability.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

7. DEBT

The carrying value of our credit facilities, finance leases and long-term debt as of March 31, 2026 and December 31, 2025 is listed in the following table, and is adjusted for unamortized discounts, deferred issuance costs and the unamortized portion of adjustments to fair value recorded in purchase accounting. Original issue discounts and adjustments to fair value recorded in purchase accounting are amortized to interest expense over the term of the applicable instrument using the effective interest method.


		March 31, 2026						December 31, 2025
Maturity	Interest Rate	Principal		Adjustments		Carrying Value		Principal		Adjustments		Carrying Value
Credit facilities:
Uncommitted Credit Facility	Variable	$	50	$	—	$	50	$	—	$	—	$	—
The Credit Facility	Variable	188		—		188		425		—		425

Commercial Paper	Variable	1,422		(1)		1,421		1,000		(1)		999
Senior notes:



July 2026	2.900	500		—		500		500		—		500
November 2027	3.375	650		(1)		649		650		(1)		649
May 2028	3.950	800		(5)		795		800		(5)		795
April 2029	4.875	750		(4)		746		750		(5)		745
November 2029	5.000	400		(3)		397		400		(3)		397
March 2030	2.300	600		(3)		597		600		(3)		597
July 2030	4.750	500		(5)		495		500		(5)		495
February 2031	1.450	650		(4)		646		650		(5)		645
February 2032	1.750	750		(4)		746		750		(4)		746
March 2033	2.375	700		(5)		695		700		(5)		695
December 2033	5.000	650		(8)		642		650		(8)		642
April 2034	5.000	800		(9)		791		800		(9)		791
November 2034	5.200	500		(5)		495		500		(5)		495
March 2035	6.086	182		(10)		172		182		(10)		172
March 2035	5.150	700		(10)		690		700		(10)		690
March 2040	6.200	400		(3)		397		400		(3)		397
May 2041	5.700	386		(5)		381		386		(5)		381
March 2050	3.050	400		(6)		394		400		(7)		393
Debentures:
September 2035	7.400	148		(26)		122		148		(26)		122
Tax-exempt:
2026 - 2056	2.550 - 3.450	1,422		(10)		1,412		1,378		(9)		1,369
Finance leases and other:
2026 - 2063	1.726 - 9.750	443		—		443		441		—		441
Total Debt		$	13,991	$	(127)	13,864		$	13,710	$	(129)	13,581
Less: current portion						(547)						(596)
Long-term portion						$	13,317					$	12,985

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Credit Facilities

Uncommitted Credit Facility

In January 2022, we entered into a $200 million unsecured uncommitted revolving credit facility (the Uncommitted Credit Facility). The Uncommitted Credit Facility bears interest at an annual percentage rate to be agreed upon by both parties. Borrowings under the Uncommitted Credit Facility can be used for working capital, letters of credit, and other general corporate purposes. The agreement governing our Uncommitted Credit Facility requires us to comply with certain covenants. The Uncommitted Credit Facility may be terminated by either party at any time. As of March 31, 2026, we had $50 million of borrowings outstanding under our Uncommitted Credit Facility. As of December 31, 2025, we had no borrowings outstanding under our Uncommitted Credit Facility.

The Credit Facility

In July 2024, we and our subsidiary, USE Canada Holdings, Inc. (the Canadian Borrower) entered into the Second Amended and Restated Credit Agreement (the Credit Facility) which amended and restated the unsecured revolving credit facility we entered into in August 2021. The total outstanding principal amount that we may borrow under the Credit Facility may not exceed the current aggregate lenders' commitments of $3.5 billion, and borrowings under the Credit Facility mature in July 2029. As permitted by the Credit Facility, we have the right to request two one-year extensions of the maturity date, but none of the lenders are committed to participate in such extensions. The Credit Facility also includes a feature that allows us to increase availability, at our option, by an aggregate amount of up to $1.0 billion through increased commitments from existing lenders or the addition of new lenders.

All loans to the Canadian Borrower and all loans denominated in Canadian dollars cannot exceed $1.0 billion (the Canadian Sublimit). The Canadian Sublimit is part of, and not in addition to, the aggregate commitments under the Credit Facility.

Borrowings under the Credit Facility in United States dollars bear interest at a Base Rate, a daily floating SOFR or a term SOFR, plus a current applicable margin of 0.805% based on our Debt Ratings (all as defined in the Credit Facility agreement). The Canadian dollar-denominated loans bear interest based on the Canadian Prime Rate or the Canadian Dollar Offered Rate (all as defined in the Credit Facility agreement) plus a current applicable margin of 0.805% based on our Debt Ratings. As of March 31, 2026 and December 31, 2025, C$261 million and C$204 million, respectively, were outstanding against the Canadian Sublimit.

The Credit Facility is subject to facility fees based on applicable rates defined in the Credit Facility agreement and the aggregate commitment, regardless of usage. The Credit Facility can be used for working capital, capital expenditures, acquisitions, letters of credit and other general corporate purposes. The Credit Facility agreement requires us to comply with financial and other covenants. We may pay dividends and repurchase common stock if we are in compliance with these covenants.

We had $188 million and $425 million outstanding under the Credit Facility as of March 31, 2026 and December 31, 2025, respectively. We had $315 million and $319 million of letters of credit outstanding under the Credit Facility as of March 31, 2026 and December 31, 2025, respectively. We also had $1.4 billion and $1.0 billion of principal borrowings outstanding under our commercial paper program as of March 31, 2026 and December 31, 2025, respectively. As a result, availability under the Credit Facility was $1.6 billion and $1.8 billion as of March 31, 2026 and December 31, 2025, respectively.

Commercial Paper Program

In May 2022, we entered into a commercial paper program for the issuance and sale of unsecured commercial paper in an aggregate principal amount not to exceed $500 million outstanding at any one time (the Commercial Paper Cap). In August 2022, the Commercial Paper Cap was increased to $1.0 billion, and in October 2023, was increased to $1.5 billion. The weighted average interest rate for borrowings outstanding as of March 31, 2026 was 4.069%. The weighted average interest rate for borrowings outstanding as of December 31, 2025 was 4.044%.

We had $1.4 billion and $1.0 billion principal value of commercial paper issued and outstanding under the program as of March 31, 2026 and December 31, 2025, respectively. In the event of a failed re-borrowing, we currently have availability under our Credit Facility to fund amounts currently borrowed under the commercial paper program until they are re-borrowed successfully. Accordingly, we have classified these borrowings as long-term in our consolidated balance sheets as of March 31, 2026 and December 31, 2025, respectively.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Senior Notes and Debentures

In March 2025, we issued $500 million of 4.750% senior notes due 2030 and $700 million of 5.150% senior notes due 2035. We used the proceeds from the March 2025 notes issuance for general corporate purposes, including the repayment of a portion of amounts outstanding on our Credit Facility and a portion of outstanding borrowings under the Commercial Paper Program.

Our senior notes and debentures are general unsecured and unsubordinated obligations and rank equally with our other unsecured obligations.

Tax-Exempt Financings

As of both March 31, 2026 and December 31, 2025, we had $1.4 billion of tax-exempt financings outstanding with maturities ranging from 2026 to 2056 and 2026 to 2054, respectively.

In March 2026, the California Municipal Finance Authority issued, for our benefit, $100 million in principal amount of Solid Waste Disposal Revenue Bonds. The proceeds from the issuance, after deferred issuance costs, will be used to fund the acquisition, construction, improvement, installation, and/or equipping of certain solid waste disposal facilities located within California, of which $81 million had been incurred and reimbursed to us as of March 31, 2026. As of March 31, 2026, we had $292 million of restricted cash and marketable securities, of which $19 million represented proceeds from the issuance of the tax-exempt bonds.

We have $250 million of tax-exempt financings that have an initial remarketing period of 10 years. Our remaining tax-exempt financings are remarketed either quarterly or semiannually by remarketing agents to effectively maintain a variable yield. The holders of the bonds can put them back to the remarketing agents at the end of each interest period. If the remarketing agents are unable to remarket our bonds, the remarketing agents can put the bonds to us. In the event of a failed remarketing, we currently have availability under our Credit Facility to fund these bonds until they are remarketed successfully. Accordingly, we classified these borrowings as long-term in our consolidated balance sheets as of March 31, 2026 and December 31, 2025.

Finance Leases and Other

As of March 31, 2026 and December 31, 2025, we had finance leases and other liabilities of $443 million and $441 million, respectively, with maturities ranging from 2026 to 2063 for both periods, respectively.

As of March 31, 2026 and December 31, 2025, finance leases and other included $154 million and $148 million, respectively, related to construction costs for our corporate office building located in Phoenix, Arizona, which has been accounted for as a financing obligation.

8. INCOME TAXES

Our effective tax rate, exclusive of non-controlling interests, for the three months ended March 31, 2026 and 2025 was 19.9% and 25.6%, respectively.

Our effective tax rate for the three months ended March 31, 2026 reflects a benefit of $37 million due to our investments in renewable energy assets and $3 million due to investments in renewable natural gas projects and electric vehicle infrastructure.

Our effective tax rate for the three months ended March 31, 2025 reflects a benefit of $2 million due to investments in renewable natural gas projects and commercial electric vehicles.

For the three months ended March 31, 2026 and 2025, net cash paid for income taxes was $4 million and $2 million, respectively.

We have deferred tax assets related to state net operating loss carryforwards with an estimated tax effect of $50 million available as of March 31, 2026. These state net operating loss carryforwards expire at various times between 2027 and 2046. We believe that it is more likely than not that the benefit from some of our state net operating loss carryforwards will not be realized due to limitations on these loss carryforwards in certain states. In recognition of this risk, as of March 31, 2026, we have provided a valuation allowance of $40 million.

We are subject to income tax in the United States and Canada, as well as multiple state jurisdictions. Our compliance with income tax rules and regulations is periodically audited by taxing authorities. These authorities may challenge the positions taken in our tax filings. Thus, to provide for certain potential tax exposures, we maintain liabilities for uncertain tax positions for our estimate of the final outcome of these examinations. Our federal statute of limitations applicable to our federal tax returns is closed through 2021. In addition, we are currently under state examination or administrative review in various jurisdictions for tax years 2013 through 2024.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

We recognize interest and penalties as incurred within the provision for income taxes in the consolidated statement of income. As of March 31, 2026, we accrued a liability for penalties of $3 million and a liability for interest (including interest on penalties) of $5 million related to our uncertain tax positions.

We believe the recorded liabilities for uncertain tax positions are adequate. However, a significant assessment against us in excess of the liabilities recorded could have a material adverse effect on our consolidated financial position, results of operations and cash flows.

9. SHARE REPURCHASES, DIVIDENDS AND EARNINGS PER SHARE

Available Shares

We currently have approximately 10 million shares of common stock reserved for future grants under the Republic Services, Inc. 2021 Stock Incentive Plan.

Share Repurchases

In October 2023, our Board of Directors approved a $3.0 billion share repurchase authorization effective January 1, 2024 and extending through December 31, 2026. Share repurchases under the program may be made through open market purchases or privately negotiated transactions in accordance with applicable federal securities laws. While the Board of Directors has approved the program, the timing of any purchases, the prices and the number of shares of common stock to be purchased will be determined by our management, at its discretion, and will depend upon market conditions and other factors. The share repurchase program may be extended, suspended or discontinued at any time. On a quarterly basis, our Board of Directors reviews the intrinsic value of our stock and the parameters around which we repurchase our shares.

Share repurchase activity during the three months ended March 31, 2026 and 2025 follows (in millions, except per share amounts):


	Three Months Ended March 31,
	2026		2025
Number of shares repurchased	1.3		0.3
Amount paid	$	292	$	55
Weighted average cost per share	$	218.22	$	201.40

The average price paid per share, total repurchase costs and approximate maximum dollar value of the shares that may yet be purchased under the plans or programs exclude a 1% excise tax.

As of March 31, 2026, there were less than 1 million repurchased shares pending settlement, resulting in an associated $22 million of share repurchases unpaid and included within other accrued liabilities. As of March 31, 2025, there were no repurchased shares pending settlement. As of March 31, 2026, the remaining authorized purchase capacity under our October 2023 repurchase program was $1.4 billion.

Dividends

In February 2026, our Board of Directors approved a quarterly dividend of $0.625 per share. Cash dividends declared were $192 million for the three months ended March 31, 2026. As of March 31, 2026, we recorded a quarterly dividend payable of $192 million to shareholders of record at the close of business on April 2, 2026.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Earnings per Share

Basic earnings per share is computed by dividing net income attributable to Republic Services, Inc. by the weighted average number of common shares (including vested but unissued restricted stock units and performance stock units) outstanding during the period. Diluted earnings per share is based on the combined weighted average number of common shares and common share equivalents outstanding, which include, where appropriate, the unvested restricted stock units (RSUs) and the unvested performance stock units (PSUs) at the expected attainment levels. We use the treasury stock method in computing diluted earnings per share.

Earnings per share for the three months ended March 31, 2026 and 2025 are calculated as follows (in thousands, except per share amounts):


	Three Months Ended March 31,
	2026		2025
Basic earnings per share:
Net income attributable to Republic Services, Inc.	$	525,259	$	494,996
Weighted average common shares outstanding	309,089		312,967
Basic earnings per share	$	1.70	$	1.58
Diluted earnings per share:
Net income attributable to Republic Services, Inc.	$	525,259	$	494,996
Weighted average common shares outstanding	309,089		312,967
Effect of dilutive securities:

Unvested RSU awards	46		108
Unvested PSU awards	138		202
Weighted average common and common equivalent shares outstanding	309,273		313,277
Diluted earnings per share	$	1.70	$	1.58

10. FINANCIAL INSTRUMENTS

Fair Value Measurements

In measuring fair values of assets and liabilities, we use valuation techniques that maximize the use of observable inputs (Level 1) and minimize the use of unobservable inputs (Level 3). We also use market data or assumptions that we believe market participants would use in pricing an asset or liability, including assumptions about risk when appropriate.

The carrying value for certain of our financial instruments, including cash, accounts receivable, accounts payable and certain other accrued liabilities, approximates fair value because of their short-term nature.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

As of March 31, 2026 and December 31, 2025, our assets and liabilities that are measured at fair value on a recurring basis include the following:


	March 31, 2026
			Fair Value
	Carrying Amount		Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Money market mutual funds - restricted cash and marketable securities and other assets	$	77	$	77	$	77	$	—	$	—
Bonds and fixed income - restricted cash and marketable securities and other assets	94		94		—		94		—
Derivative and hedging assets - other assets, prepaid expenses and other current assets	36		36		—		36		—
Total assets	$	207	$	207	$	77	$	130	$	—
Liabilities:
Derivative and hedging liabilities - other accrued liabilities and other long-term liabilities	$	49	$	49	$	—	$	49	$	—
Contingent consideration - other accrued liabilities and other long-term liabilities	63		63		—		—		63
Total liabilities	$	112	$	112	$	—	$	49	$	63


	December 31, 2025
			Fair Value
	Carrying Amount		Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Money market mutual funds - restricted cash and marketable securities and other assets	$	75	$	75	$	75	$	—	$	—
Bonds and fixed income - restricted cash and marketable securities and other assets	97		97		—		97		—
Derivative and hedging assets - other assets, prepaid expenses and other current assets	32		32		—		32		—
Total assets	$	204	$	204	$	75	$	129	$	—
Liabilities:
Derivative and hedging liabilities - other accrued liabilities and other long-term liabilities	$	46	$	46	$	—	$	46	$	—
Contingent consideration - other accrued liabilities and other long-term liabilities	63		63		—		—		63
Total liabilities	$	109	$	109	$	—	$	46	$	63

Total Debt

As of March 31, 2026 and December 31, 2025, the carrying value of our total debt was $13.9 billion and $13.6 billion, respectively, and the fair value of our total debt was $13.6 billion and $13.5 billion, respectively. The estimated fair value of our fixed rate senior notes, debentures and certain tax-exempt financings is based on quoted market prices. The fair value of our remaining notes payable, tax-exempt financings and borrowings under our credit facilities approximates the carrying value because the interest rates are variable. The fair value estimates are based on Level 2 inputs of the fair value hierarchy as of March 31, 2026 and December 31, 2025. See Note 7, Debt, for further information related to our debt.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

11. SEGMENT REPORTING

Our senior management evaluates, oversees and manages the financial performance of our operations through three field groups, referred to as Group 1, Group 2 and Group 3. Group 1 is our recycling and waste business operating primarily in geographic areas located in the western United States. Group 2 is our recycling and waste business operating primarily in geographic areas located in the southeastern and mid-western United States, the eastern seaboard of the United States, and Canada. Group 3 is our environmental solutions business operating in geographic areas located across the United States and Canada. These groups are presented below as our reportable segments, which each provide integrated environmental services, including but not limited to collection, transfer, recycling and disposal.

Our chief operating decision maker (CODM) is Jon Vander Ark, President and Chief Executive Officer of Republic Services, Inc. Adjusted EBITDA is the single financial measure our CODM uses to evaluate segment profitability and returns, which informs resource allocation. For all segments, the CODM uses Adjusted EBITDA to evaluate income generated from segment assets (return on invested capital). The CODM considers budget-to-actual variances and year-over-year growth on a monthly basis to assess the performance of each segment. Cost of operations and selling, general and administrative expenses are significant segment expenses used in the evaluation.

Summarized financial information concerning our reportable segments for the three months ended March 31, 2026 and 2025 follows:


	Group 1		Group 2		Recycling & Waste Subtotal (1)		Group 3 (Environmental Solutions)		Corporate entities and other		Total
Three Months Ended March 31, 2026
Gross revenue	$	2,202	$	1,995	$	4,197	$	407	$	95	$	4,699
Intercompany revenue	(318)		(254)		(572)		(9)		(5)		(586)
Revenue allocations	44		39		83		7		(90)		—
Net revenue	1,928		1,780		3,708		405		—		4,113
Cost of operations	1,068		1,032		2,100		266		—		2,366
Selling, general and administrative	191		173		364		61		—		425

Adjusted EBITDA	$	669	$	575	$	1,244	$	78	$	—	$	1,322
Capital expenditures	$	276	$	153	$	429	$	29	$	18	$	476
Total assets	$	14,716	$	11,646	$	26,362	$	5,241	$	2,997	$	34,600

Three Months Ended March 31, 2025
Gross revenue	$	2,064	$	1,977	$	4,041	$	454	$	98	$	4,593
Intercompany revenue	(304)		(249)		(553)		(13)		(18)		(584)
Revenue allocations	37		35		72		8		(80)		—
Net revenue	1,797		1,763		3,560		449		—		4,009
Cost of operations	1,012		1,016		2,028		286		—		2,314
Selling, general and administrative	187		170		357		70		—		427

Adjusted EBITDA	$	598	$	577	$	1,175	$	93	$	—	$	1,268
Capital expenditures	$	158	$	96	$	254	$	35	$	170	$	459
Total assets	$	14,007	$	11,301	$	25,308	$	5,129	$	2,666	$	33,103

(1) The Recycling & Waste Subtotal represents the combined results of our Group 1 and Group 2 reportable segments.

Corporate entities and other includes marketing, operations support, business development, legal, tax, treasury, information technology, risk management, human resources and other administrative functions. National Accounts revenue included in Corporate entities and other represents the portion of revenue generated from nationwide and regional contracts in markets outside our operating areas where the associated material handling is subcontracted to local operators. Revenue and overhead costs of Corporate entities and other are either specifically assigned or allocated on a rational and consistent basis among our reportable segments to calculate Adjusted EBITDA.

Intercompany revenue reflects transactions within and between segments. Capital expenditures for Corporate entities and other

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

for the three months ended March 31, 2026 largely included investments in our digital platforms. Capital expenditures for Corporate entities and other for the three months ended March 31, 2025 primarily included vehicle inventory acquired but not yet assigned to operating locations and facilities.

As presented in the table below, Adjusted EBITDA reflects certain adjustments for loss from unconsolidated equity method investments, restructuring charges, and gain on business divestitures and impairments, net. This presentation is consistent with how our CODM reviews our results of operations to make resource allocation decisions.

A reconciliation of the Company's single measure of segment profitability (segment Adjusted EBITDA) to income before income taxes in the Consolidated Statements of Net Income is as follows:


	Three Months Ended March 31
		2026		2025
Group 1 Adjusted EBITDA		$	669	$	598
Group 2 Adjusted EBITDA		575		577
Group 3 Adjusted EBITDA		78		93
Total Adjusted EBITDA		1,322		1,268
Other income, net		(27)		(11)
Interest income		(2)		(2)
Interest expense		151		140
Depreciation, depletion and amortization		461		434
Accretion		30		28
Loss from unconsolidated equity method investment		52		12

Restructuring charges		2		4

Gain on business divestitures and impairments, net		(1)		(2)

Income before income taxes		$	656	$	665

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

12. REVENUE AND CREDIT LOSSES

Our operations primarily consist of providing environmental services. The following table disaggregates our revenue by service line for the three months ended March 31, 2026 and 2025 (in millions of dollars and as a percentage of revenue):


	Three Months Ended March 31,
	2026				2025
Collection:
Residential	$	747	18.2	%	$	743	18.6	%
Small-container	1,306		31.8		1,243		31.0
Large-container	768		18.7		739		18.4
Other	17		0.4		18		0.4
Total collection	2,838		69.1		2,743		68.4
Transfer	440				424
Less: intercompany	(240)				(236)
Transfer, net	200		4.9		188		4.7
Landfill	764				723
Less: intercompany	(311)				(302)
Landfill, net	453		11.0		421		10.5
Environmental solutions	417				466
Less: intercompany	(12)				(17)
Environmental solutions, net	405		9.8		449		11.2
Other:
Recycling processing and commodity sales	112		2.7		108		2.7
Other non-core	105		2.5		100		2.5
Total other	217		5.2		208		5.2
Total revenue	$	4,113	100.0	%	$	4,009	100.0	%

Other non-core revenue consists primarily of revenue from National Accounts, which represents the portion of revenue generated from nationwide or regional contracts in markets outside our operating areas where the associated material handling is subcontracted to local operators. Consequently, substantially all of this revenue is offset with related subcontract costs, which are recorded in cost of operations.

Intercompany revenue reflects transactions within and between lines of business.

See Note 11, Segment Reporting, for additional information regarding revenue by reportable segment.

Revenue Recognition

Our service obligations of a long-term nature, e.g., certain collection service contracts, are satisfied over time, and we recognize revenue based on the value provided to the customer during the period. The amount billed to the customer is based on variable elements such as the number of residential homes or businesses for which collection services are provided, the volume of material collected, treated, transported and disposed, and the nature of the material accepted. We do not disclose the value of unsatisfied performance obligations for these contracts as our right to consideration corresponds directly to the value provided to the customer for services completed to date and all future variable consideration is allocated to wholly unsatisfied performance obligations.

Additionally, certain elements of our long-term customer contracts are unknown upon entering into the contract, including the amount that will be billed in accordance with annual price escalation clauses, our fuel recovery fee program and commodity prices. The amount to be billed is often tied to changes in an underlying base index such as a consumer price index or a fuel or commodity index, and revenue can be recognized once the index is established for the period.

Environmental solutions revenue is primarily generated from the fees we charge for the collection, treatment, consolidation, disposal and recycling of hazardous and non-hazardous waste, field and industrial services, equipment rental, emergency response and standby services and in-plant services, such as transportation and logistics, including at our treatment, storage and disposal facilities (TSDF). Activity for this service line varies across markets and reflects the regulatory environment, pricing and disposal alternatives available in any given market. Revenue recognized is variable in nature and primarily based on the

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

volume and type of waste accepted or processed during the period. For certain field and industrial services contracts, we have a right to consideration from our customers in an amount that corresponds directly with the value to the customer of the Company's performance completed to date. Therefore, we have applied the practical expedient to recognize revenue for the amount to which we have the right to invoice.

Deferred Revenue

The factors that impact the timing and amount of revenue recognized for each service line may vary based on the nature of the service performed. Generally, we recognize revenue at the time we perform a service. In the event that we bill for services in advance of performance, we recognize deferred revenue for the amount billed and subsequently recognize revenue at the time the service is provided. Depending on the nature of the contract, we may also generate revenue through the collection of fuel recovery fees and environmental fees which are designed to recover our internal costs of providing services to our customers.

Substantially all of the deferred revenue recognized as of December 31, 2025 was recognized as revenue during the three months ended March 31, 2026 when the service was performed.

Deferred Contract Costs

We incur certain upfront payments to acquire customer contracts which are recognized as other assets in our consolidated balance sheet, and we amortize the asset over the respective contract life. In addition, we recognize sales commissions that represent an incremental cost of the contract as other assets in our consolidated balance sheet, and we amortize the asset over the average life of the customer relationship. For the periods ended March 31, 2026 and December 31, 2025, we recognized $78 million and $81 million, respectively, of deferred contract costs and capitalized sales commissions.

Credit Losses

Accounts receivable represent receivables from customers for environmental services, including collection and processing of recyclable materials, collection, transfer, and disposal of solid waste, and environmental solutions. Our receivables are recorded when billed or when the related revenue is earned and represent claims against third parties that will be settled in cash. The carrying value of our receivables, net of the allowance for doubtful accounts and customer credits, represents their estimated net realizable value.

We establish an allowance for doubtful accounts based on various factors including the age of receivables outstanding, historical trends, economic conditions and other information. We also review outstanding balances on an account-specific basis based on the credit risk of the customer. We determined that all of our accounts receivable share similar risk characteristics. We monitor our credit exposure on an ongoing basis and assess whether assets in the pool continue to display similar risk characteristics. We perform ongoing credit evaluations of our customers, but generally do not require collateral to support customer receivables.

The following table reflects the activity in our allowance for doubtful accounts for the three months ended March 31, 2026 and 2025:


	2026		2025
Balance at beginning of year	$	66	$	74
Additions charged to expense	12		10
Accounts written-off	(18)		(17)
Balance at end of period	$	60	$	67

13. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are subject to extensive and evolving laws and regulations and have implemented safeguards to respond to regulatory requirements. In the normal course of our business, we become involved in legal proceedings. Some may result in fines, penalties or judgments against us, or settlements, which may impact earnings and cash flows for a particular period. Although we cannot predict the ultimate outcome of any legal matter with certainty, we do not believe the outcome of any of our pending legal proceedings will have a material adverse impact on our consolidated financial position, results of operations or cash flows.

As used herein, the term legal proceedings refers to litigation and similar claims against us and our subsidiaries, excluding: (1) ordinary course accidents, general commercial liability and workers' compensation claims, which are covered by insurance programs, subject to customary deductibles, and which, together with insured employee health care costs, are discussed in Note

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

5, Other Liabilities; and (2) environmental remediation liabilities, which are discussed in Note 6, Landfill and Environmental Costs.

We accrue for legal proceedings when losses become probable and reasonably estimable. As of the end of each applicable reporting period, we review each of our legal proceedings and, where it is probable that a liability has been incurred, we accrue for all probable and reasonably estimable losses. Where we can reasonably estimate a range of losses we may incur regarding such a matter, we record an accrual for the amount within the range that constitutes our best estimate. If we can reasonably estimate a range but no amount within the range appears to be a better estimate than any other, we use the amount that is the low end of such range. As of March 31, 2026, we estimate that the probable and reasonably estimable outcomes of any such legal proceedings, as well as the aggregate potential liability using reasonably possible high ends of our ranges, are immaterial to the Company's consolidated financial statements.

Multiemployer Pension Plans

We participate in multiemployer pension plans that generally provide retirement benefits to participants of contributing employers. We do not administer these plans.

Under current law regarding multiemployer pension plans, our withdrawal (which we consider from time to time) or the mass withdrawal from any under-funded multiemployer pension plan (each, a Withdrawal Event) could require us to make payments to the plan for our proportionate share of the plan’s unfunded vested liabilities. During the course of operating our business, we incur Withdrawal Events regarding certain of the multiemployer pension plans in which we participate. We accrue for such events when losses become probable and reasonably estimable.

Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents

Restricted cash and restricted cash equivalents are included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Beginning-of-period and end-of-period cash, cash equivalents, restricted cash and restricted cash equivalents as presented in the statement of cash flows are reconciled as follows:


	March 31, 2026		December 31, 2025		March 31, 2025		December 31, 2024
Cash and cash equivalents	$	118	$	76	$	83	$	74
Restricted cash and marketable securities	292		259		222		208
Less: restricted marketable securities	(83)		(86)		(81)		(79)
Cash, cash equivalents, restricted cash and restricted cash equivalents	$	327	$	249	$	224	$	203

Our restricted cash and marketable securities include amounts pledged to regulatory agencies and governmental entities as financial guarantees of our performance under certain collection, landfill and transfer station contracts and permits and relating to our final capping, closure and post-closure obligations at our landfills as well as restricted cash and marketable securities related to our insurance obligations.

The following table summarizes our restricted cash and marketable securities:


	March 31, 2026		December 31, 2025
Financing proceeds	$	19	$	—
Capping, closure and post-closure obligations	69		67
Insurance	204		192


Total restricted cash and marketable securities	$	292	$	259

Off-Balance Sheet Arrangements

We have no off-balance sheet debt or similar obligations, other than short-term operating leases and financial assurances, which are not classified as debt. We have no transactions or obligations with related parties that are not disclosed, consolidated into or reflected in our reported financial position or results of operations. We have not guaranteed any third-party debt.

Table of C ontents

Previous: Cover and table of contents · Next: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.