Xylem (XYL) 10-K risk factor changes: FY2022 vs FY2021

In addition, we operate in a continually changing business, economic and geopolitical environment and as a result, new risk [removed: factors] [added: factors, or changes to our risk profile,] may emerge from time to time.

Risks not currently known to us, or that we currently believe are immaterial, may impact our [removed: business] [added: business,] operations, financial condition or share price.

The global economic and geopolitical climate, including [removed: the impacts] [added: as a result] of the [removed: ongoing COVID-19] [added: war between Russia and Ukraine, the coronavirus ("COVID-19")] pandemic, [removed: amplifies] [added: and macroeconomic conditions, amplify] many of the risks below.

Risks in this section are grouped in the following categories: (1) Risks Related to [added: Geopolitical,] Macroeconomic and Industry Factors; (2) Risks Related to Our Business and Operations; (3) Risks Related to [removed: Legal, Regulatory] [added: Financial] and Tax; [removed: and] (4) Risks Related to [removed: Ownership] [added: Legal and Regulatory; and (5) Risks Related to the Proposed Acquisition] of [removed: Our Common Stock.][added: Evoqua.]

Risks Related to [added: Geopolitical,] Macroeconomic and Industry Factors

With sales in approximately 150 countries, we compete [removed: in] [added: across] a wide range of geographic and [removed: product markets.][added: end-markets.]

Material economic and industry factors impacting our businesses include: (i) the overall strength of, and our customers’ confidence in, local and global macroeconomic conditions; (ii) [added: inflation, (iii)] overall strength of industrial, [removed: governmental and] [added: governmental,] public and private sector spending; [removed: (iii)] [added: (iv)] overall strength of the [added: industrial,] residential and commercial real estate markets; [removed: (iv)] [added: (v)] federal, state, local and municipal governmental fiscal, trade and procurement laws, regulations and policies, including with respect to domestic content; [removed: (v)] [added: (vi)] the availability of commercial financing for our customers and end-users; and [removed: (vi)] [added: (vii)] the degree of funding for our public sector customers, including with respect to water infrastructure investments.

[removed: The macroeconomic] [added: Macroeconomic] impacts [removed: of the ongoing COVID-19 pandemic] and [removed: broader economic] dynamics, including [added: as a result of the COVID-19 pandemic,] with respect to supply chain shortages, logistics challenges, tight labor markets and inflation, have had, and continue to have, a material adverse effect on our business and results of operations.

Future [removed: slowdowns] [added: slowdowns, economic recession,] or [added: other] prolonged downturns in the global economy or our markets could have material adverse effects on our business, financial condition, cash [removed: flows and] [added: flows,] results of [removed: operations.][added: operations and stock price.]

We are exposed to geopolitical, regulatory, economic, foreign exchange and other risks associated with our global [removed: sales] [added: sales, supply chain] and operations.

In [removed: 2021, 44%] [added: 2022, 47%] of our total revenue was from [removed: customers within the] [added: sales to] U.S. [added: customers] and [removed: 56%] [added: 53%] was from [added: sales to] customers outside the U.S. We expect our sales from international operations and export sales to continue to be a significant portion of our revenue.

Many of our manufacturing operations, [removed: employees and] [added: employees,] suppliers [added: and distribution channels] are located outside of the U.S. Our [removed: operations] [added: operations, supply chain] and sales both within the U.S. and internationally are subject, in varying degrees, to risks [added: and uncertainties] inherent in doing business globally, including:

- [added: economic nationalism, populism, protectionism, anti-global sentiment and] changes in trade protection measures, including embargoes, tariffs and other trade barriers, import and export regulations, licensing requirements, and new and existing domestic content requirements for projects receiving governmental funding;

- changes in tax laws and potential negative consequences from the interpretation, application and enforcement by governmental tax authorities of tax laws and [removed: policies;][added: policies, and changes in other laws and regulations or how such provisions are interpreted or administered;]

- disruptions in our global supply chain, [added: operations or those of third parties upon which we rely,] including [removed: with respect] [added: due] to labor [removed: shortages,] [added: or] supply shortages, [removed: and] freight and logistics challenges;

- shocks to the global financial system, including due to [added: the outbreak or threat of war, armed conflict, other geopolitical conflicts, terrorism or] global health crises, the effects of climate change, or [added: other] idiosyncratic [removed: events, such as a terrorist attack;][added: events;]

- theft, compromise or misappropriation of [added: our] technology, intellectual property or data;

- [added: global or] regional safety and security considerations; [added: and]

- increased costs and risks in developing, staffing and simultaneously managing [removed: a number of] [added: our many] global operations as a result of distance, remote work arrangements, language and cultural [removed: differences; and][added: differences.]

- threat, outbreak, uncertainty or escalation of [added: terrorism,] political instability, insurrection, [added: war or other] armed conflict, [removed: terrorism, epidemics, global health crises or pandemics, or war.][added: including between Russia and Ukraine;]

In [removed: 2021, 44%] [added: the year ended December 31, 2022, 47%] of our revenues [removed: were generated in the U.S,] [added: was from sales to U.S. customers,] which included sales of products sold into federally funded projects.

We expect our U.S. sales in [removed: 2022] [added: 2023] and beyond to be similar.

However, we may not be able to successfully compete for federally funded projects as some of our products may not comply with the domestic content requirements of the U.S. Buy [removed: American] [added: America] mandate [removed: applicable to] [added: under] the Infrastructure Investment and Jobs Act [removed: (“IIJA”) signed into law on November 15, 2021,] [added: (“IIJA”),] as well as other federally funded projects.

We [removed: are assessing] [added: continue to evaluate] the risks associated with the Buy America mandate, as well as related mitigation options around sourcing and manufacturing, but there is no guarantee that we will be able to meet applicable domestic content [removed: requirements.][added: requirements across all our product lines.]

In the year ended December 31, [removed: 2021, 21%] [added: 2022, 19%] of our total revenues were generated in emerging markets and we have placed a particular emphasis in our strategy on increasing our growth and presence in emerging [removed: markets.][added: markets, including China, India, and key markets in Africa.]

Beyond the general risks that we face outside the U.S., our operations in emerging markets are subject to additional risks and uncertainties, including: (i) governments may impose [added: or increase] withholding or other taxes on remittances and other payments to [removed: us, or the amount of any such taxes may increase;] [added: us;] (ii) governments may seek to nationalize our assets; (iii) governments may impose or increase investment barriers or other restrictions affecting our business; (iv) difficulty in enforcing [added: commercial] agreements; (v) challenges collecting receivables, [added: or] protecting our intellectual property and other assets; (vi) pressure on the pricing of our products and services; (vii) higher business conduct risks; and (viii) challenges in our ability to [removed: hire] [added: attract] and retain qualified talent and labor.

We cannot predict the impact that such factors might have on our business, financial condition, cash [removed: flows and] [added: flows,] results of [removed: operations.][added: operations and stock price.]

The [removed: COVID-19] pandemic and broader global market supply and demand dynamics [removed: also] have impacted, and continue to impact our supply chain with unpredictable [removed: disruptions,] [added: disruptions] due to [added: material and] component shortages, including with respect to key electronic components such as [removed: semiconductors,] [added: chips,] capacity constraints, delays in shipment of materials necessary to the manufacture of our products, freight and logistics challenges, tight labor markets and inflation.

The COVID-19 pandemic [removed: has] caused significant volatility and uncertainty in the [added: global] financial and capital markets.

A further disruption of [removed: global financial markets] [added: these markets,] or resulting economic downturn from the COVID-19 pandemic or [added: outbreak of] other global health [removed: crises] [added: crises,] may [removed: reduce] [added: impact] our ability to incur debt or access capital, or increase our cost of capital.

A sustained [added: economic] downturn [removed: may] [added: could] impact our liquidity position, including our ability to continue to pay dividends, or [removed: may] [added: could] impact our asset values resulting in the carrying value of our goodwill or other intangible assets exceeding their fair value, which may require us to recognize an impairment to those assets.

Inflation, tariffs, customs duties and other increases in manufacturing and operating costs [added: have, and] could [added: continue to,] adversely affect our cash flows and results of operations.

Our operating costs are subject to fluctuations, particularly due to changes in prices for commodities, parts, raw materials, energy and related utilities, [removed: freight,] [added: freight] and [added: logistics, and] cost of [removed: labor] [added: labor,] which have been and may continue to be driven by [added: a variety of factors, including] inflation, [removed: tightening] [added: tight] labor markets, prevailing price levels, exchange rates, changes in trade agreements and trade protection measures including tariffs, and other economic factors.

Throughout [removed: 2021] [added: 2022] our operating costs have been [added: adversely] impacted by price inflation, including with respect to the cost of certain raw materials, electronic components, commodities, freight and logistics, and we expect this to continue for the foreseeable future.

Additional tariffs imposed by the U.S., or further retaliatory trade measures taken by China or other countries, could increase the cost of our products that we may not be able to [removed: offset.][added: offset through price increases or productivity.]

Sales outside of the U.S. for the year ended December 31, [removed: 2021] [added: 2022] accounted for approximately [removed: 56%] [added: 53%] of our net sales.

We also have significant operations in various locations outside of the U.S. [removed: We are therefore exposed to fluctuations in foreign] [added: Our principal] currency [removed: exchange rates, particularly with respect] [added: exposures for which we enter into cash flow hedges relate] to the Euro, Swedish Krona, British Pound, Canadian Dollar, Australian Dollar, and Polish Zloty.

[added: The] translation risk is primarily concentrated in the exchange rate between the U.S. Dollar and the Euro, Chinese Yuan, British Pound, Canadian Dollar, Australian Dollar, Swedish [removed: Krona,] [added: Krona] and Indian Rupee.

Strengthening of the U.S. Dollar relative to the Euro and the currencies of the other countries in which we do business, has materially and adversely [removed: affected] [added: affected,] and could in the future materially and adversely [removed: affect] [added: affect,] our sales growth and profitability in future periods.

Our competitive position and future growth rate depend upon a number of factors, including our ability to successfully: (i) innovate, develop and maintain competitive [removed: products,] [added: and secure products and] services, [added: as well as] business models and customer [removed: experience] [added: experience,] to address emerging [added: regulations and] trends and meet customers’ needs (including those related to social, environmental and sustainability matters), (ii) defend our market share against an ever-expanding number of competitors, many of which are new and non-traditional competitors from outside our industry, such as large technology firms, or those out of emerging markets, (iii) enhance our product and service offerings by adding innovative [removed: features] [added: features, increased efficiency] or disruptive technologies that differentiate them from those of our competitors and prevent commoditization, (iv) develop, manufacture and bring [removed: compelling] [added: compelling, secure and efficient] new products and services to market quickly and cost-effectively, (v) continue to cultivate, develop and maintain our distribution network of channel partners, (vi) attract, develop and retain individuals with the requisite innovation, digital and technical expertise and understanding of customers’ needs to develop and commercialize new technologies, products and services, (vii) continue to [added: leverage and expand our external ecosystem of innovation partners from universities, venture capital, the start-up of community and other technology firms, (viii) continue to] invest in our manufacturing, research and development, engineering, sales and marketing, [added: digitization of] customer service and [removed: support,] [added: support tools,] and distribution networks, [removed: (viii)] [added: (ix)] win large contracts, and [removed: (ix)] [added: (i)] compete for business subject to applicable governmental procurement laws, regulations and policies, including new and existing domestic content requirements in the U.S. and globally, as they may evolve over time.

- instability of and impacts from the evolving global geopolitical environment, including with respect to the relationships among the U.S., European Union, China, Taiwan, or other foreign countries, and the international community at large;

- threat or outbreak of epidemics, global health crises or pandemics, such as COVID-19, and related uncertainties;

- actual or threatened war or armed conflict, labor actions, or civil, political or other disturbances;

We have significant sales, operations and direct or indirect suppliers located in China, which have been in the past, or could in the future be, adversely affected by China’s evolving laws, regulations and policies, including with respect to its evolving COVID Policy, import and export tariffs and restrictions, and information security and privacy.

Our business and operating results could also be adversely impacted by changes in the political and geopolitical environment involving China, including U.S.-China or China-Taiwan relations.

For example, the U.S.’ imposition of tariffs on goods imported from China or deemed to be of Chinese origin, as well as the potential for new tariffs, other governmental actions, trade embargoes or sanctions by the U.S., or countermeasures imposed by China in response, has in the past and could in the future have an adverse direct or indirect impact our global supply chain, manufacturing costs, and sales and operations in China.

Furthermore, geopolitical changes in China-Taiwan relations could disrupt the operations of several companies in Taiwan that are critical to our complex, global supply chain, including with respect to the supply of semiconductors (“chips”) and other electronic components.

Such changes could likely have significant negative effects on the global semiconductor industry and could adversely affect our ability to manufacture our digitally-enabled products, such as pumps, controllers and smart meters.

We are unable to predict the extent to which the ongoing global COVID-19 pandemic, or other outbreaks, epidemics, pandemics, or public health crises may adversely impact our business, results of operations and financial condition.

Outbreaks of epidemics, pandemics, or public health crises could adversely affect, among other things, demand for our products and services; our operations and sales; our supply chain; our research and development capabilities, engineering, design, and manufacturing processes; and other important business activities.

Such outbreaks could result in the restriction or suspension of travel, prohibitions of non-essential activities, and limit in-person activities within our Company and with customers and could also present operational challenges, such as disruptions in our manufacturing and supply chain and logistics, all of which can adversely affect our ability to fulfill orders, provide services, respond to customer requests and maintain our business operations.

We are unable to predict the full extent of the impact of the outbreak of epidemics, pandemics, or public health crises on our operations, customers and suppliers.

Since early 2020, the COVID-19 pandemic and its variants have resulted in, and may continue to result in, a slowdown of global economic activity, travel restrictions, prohibitions of non-essential activities in some cases, disruption and shutdown of businesses, including that of our customers and suppliers.

Our operations have been affected by a range of external factors related to the COVID-19 pandemic that are not within our control, including the various governmental restrictions on employees, customers, partners and suppliers, such as China’s COVID Policy, designed to limit the spread of COVID-19.

While component supply shortages are showing signs of recovery, they may nevertheless persist, adversely disrupting our business.

The ultimate extent of the impacts of the COVID-19 pandemic, including as a result of possible subsequent outbreaks of new variants and measures taken in response thereto remains highly uncertain and cannot currently be predicted and we may not be successful at mitigating such impacts.

In addition, we have significant manufacturing operations in Europe, which could be adversely impacted by increased costs for energy as a result of the Russia-Ukraine conflict and governments' efforts to decrease dependence on Russia energy supplies.

While we have certain system redundancies as well as business continuity and disaster recovery planning and response plans, we cannot guarantee that these measures will be effective or adequate to respond to damage, disruption or shut-down circumstances.

In addition, our customers may continue to use digitally-enabled products that were designed, manufactured and sold by us at a time when current security features were not available.

aluminum and plastics.

In addition, any threatened or actual escalation of the Russia-Ukraine conflict, including impacts such as disruption or increased cost of energy supply in Europe, could delay or interrupt our supplies from suppliers of energy intensive materials, such as steel, glass and plastics, among others.

In addition, our facilities or that of third parties upon which we rely operate in certain circumstances with equipment that may be unique and difficult to replace or involve long lead times for replacement.

We are subject to increasing regulatory requirements around sustainability-related disclosures, including significant anticipated rulemaking by the SEC, which may continue to evolve.

Complying with regulators’ disclosure requirements may impose substantial additional costs and require additional resources, including with respect to third-party attestation, to enable the capture, analysis and audit of appropriate data.

Any actual or alleged failure to comply with regulatory requirements could result in fines, penalties and civil liabilities, and damage to our reputation.

Refer to

- instability and uncertainties arising from the global geopolitical environment, including economic nationalism, populism, protectionism and anti-global sentiment;

- changes in other laws and regulations or how such provisions are interpreted or administered;

- disruption of operations from labor, civil, political or other disturbances;

We continue to monitor the impacts of the U.K.’s exit from the EU (“Brexit”) on our supply chain, operations and financial results.

The U.K. and the EU's Trade and Cooperation Agreement (“TCA”) creates a number of risks and uncertainties for our businesses, including: 1) our services are subject to the World Trade Organization’s rules until the parties to the TCA agree on rules around trade in services, and 2) a delay in implementing final provisions on border checks, with some transitional arrangements for 2021 being continued into 2022.

The U.K. will also need to negotiate its own trade treaties with countries around the world, which could take years to complete, and any disagreements on trade terms could result in supply chain delays or other disruptions.

As a result, we face continued uncertainty and risks of disruption in our supply chain and increased costs.

The COVID-19 pandemic has adversely impacted, and continues to pose risks to, our business, results of operations and financial condition, the nature and extent of which are highly uncertain and unpredictable.

The ongoing COVID-19 pandemic has had, and may continue to have, an adverse impact on our employees, customers, supply chain, operations and sales.

The COVID-19 pandemic has, and may in the future, curtail the movement of people, goods and services worldwide, including in many of the regions where we sell our products and services and conduct operations.

Government-mandated precautions to mitigate the spread of COVID-19, including travel restrictions, quarantines, stay at home or similar measures in many of the areas in which we operate, resulted in temporary production impacts at several of our facilities in 2020 and 2021, curtailed, and may in the future curtail, the business and operations of some of our customers and suppliers, including our ability to access our customers’ sites.

If the COVID-19 pandemic continues or worsens, including additional mutations of the virus, we may experience a decline in sales and customer orders in certain of our businesses.

Different markets and parts of our business will recover from the COVID-19 pandemic at different rates depending on many factors,

including vaccination levels or new COVID-19 variants and related outbreaks.

While we have taken measures to mitigate these impacts, as the pandemic continues, or if it worsens, our manufacturing facilities, supply chain and logistics may continue to be significantly impacted.

Accordingly, the pandemic has negatively impacted our revenue growth in certain of our businesses.

It is uncertain how materially the COVID-19 pandemic, including additional mutations of the virus, the corresponding rollout, efficacy or unanticipated consequences of vaccines, and the pace of recovery will affect our global operations and sales if these impacts persist, worsen or re-emerge throughout 2022 and beyond.

The extent and duration of these impacts on us are dependent in part on demand for our products and services and, our ability to meet customer demand; customers’ budgets, spending, willingness to allow us access to their job sites and continuation of planned projects; continued funding for infrastructure investments, particularly water infrastructure; our suppliers’ ability to continue to supply us with parts, components and raw materials, and logistics providers' ability to continue shipment of our products and supplies in a timely manner.

The effects of the COVID-19 pandemic, including remote working arrangements for employees, has not to date impacted but could in the future impact our financial reporting systems and internal control over financial reporting.

We cannot reasonably estimate the length or severity of the ongoing COVID-19 pandemic or the associated macroeconomic impacts, including impacts on our markets and other impacts to our business, financial position, results of operations and cash flows.

To the extent that COVID-19 conditions improve, the duration and sustainability of such improvements will be uncertain, and continuing adverse impacts or the degree of improvement may vary by business and/or geography.

Actions we may take in response to improvements in conditions may also vary by business and/or geography, and may be made with incomplete information.

There is a risk that such actions could be premature, insufficient or incorrect and could have a material adverse impact on our business and results of operations.

The TCA between the U.K. and EU imposes duties on goods traded between the U.K. and EU.

In order to remain competitive, we may not be able to recover all or a portion of these higher costs from our customers through price increases.

The

Refer to Item 7A.

"Quantitative and Qualitative Disclosures about Market Risk" for additional information on foreign exchange risk.

Our pension and other defined benefit plans are subject to financial market risks that could adversely impact our earnings, financial condition and cash flows in future periods.

Certain current and retired employees are covered by pension and other defined benefit plans (collectively, “post-retirement benefit plans”).

We make contributions to fund our post-retirement benefit plans when we consider it necessary or advantageous to do so.

Significant changes in market interest rates, decreases in fair value of or investment losses on plan assets, changes in discount rates, or changes in minimum funding requirements established by governments, taxing authorities or other agreements, could increase our funding obligations and adversely impact our earnings, financial condition and cash flows in future periods.

In addition, the cost of our post-retirement benefit plans is incurred over long periods of time and involves factors that can be volatile and unpredictable, including rates of return on plan assets, discount rates used to calculate liabilities and expenses, change in laws and regulatory actions, and changes in actuarial experience and assumptions, which could adversely impact our earnings, results of operations, financial condition and cash flows.

We have, or operate through, a concentration of operations on certain sites, such as production and shared service centers.

In any such circumstances, our system redundancy and other business continuity and disaster recovery planning and response may be ineffective or inadequate.

suppliers including decisions to exit production of key components upon which we rely, interruptions in suppliers' production, labor disputes, the impaired financial condition of a particular supplier, suppliers’ capacity allocations to other purchasers, changes in trade agreements and trade protection measures including tariffs, exchange rates and prevailing price levels, ability to meet regulatory requirements, weather emergencies and associated effects of climate change, the ongoing effects of the COVID-19 pandemic or other public health crises or threatened or actual armed conflict, acts of war or terrorism.

We also have a concentration of operations at certain sites, such as production and shared services centers.

critical to our long-term success.

Our financial results can be difficult to predict.

Our business is impacted by a substantial amount of short cycle, and book-and-bill business, which we have limited insight into, particularly for the business that we transact through our significant distribution network.

*This section of this Form 10-K generally discusses [removed: 2021] [added: 2022] and [removed: 2020] [added: 2021] items and year-to-year comparisons between [removed: 2021] [added: 2022] and [removed: 2020.][added: 2021.]

Discussions of [removed: 2019] [added: 2020] items and year-to-year comparisons between [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2020.*][added: 2021.*]

We also provide analytical instrumentation used to measure and analyze water quality, flow and level in clean water, wastewater, [removed: surface water] and [removed: coastal] [added: outdoor] environments.

COVID-19 Pandemic [removed: Update][added: Update and Macroeconomic Conditions]

This section summarizes the most significant impacts related to the [added: ongoing] COVID-19 pandemic that we have experienced to date, and we have included additional details as applicable throughout other sections of this Annual Report.

We have also experienced, and continue to experience, increased inflation, [removed: freight and logistics costs, issues with port congestion, delivery delays] [added: freight, logistics, labor] and [removed: labor.][added: overhead costs.]

Additionally, we have and continue to take measures with respect to buffer stock, the use of alternative suppliers [removed: or] [added: and] redesign of certain products to mitigate the impacts of the ongoing supply chain, freight and logistics delays and bolster our access to electronics, parts and raw materials.

If these [removed: shortages and interruptions] [added: issues] continue, [removed: or if additional interruptions occur,] they could have a negative impact on our results of operations.

To some extent, [added: our] mitigation strategies have alleviated these issues but our lead times continue to be [removed: impacted.][added: impacted to varying degrees.]

Many of our offices globally remain in a substantially remote work from home [added: or hybrid] status, with no material disruption to operations, financial reporting systems, internal control over financial reporting or disclosure controls and procedures.

Risk Factors" in the Company's [removed: 2021] [added: 2022] Annual Report.

[removed: Excluding revenue,] Xylem provides guidance only on a non-GAAP basis due to the inherent difficulty in forecasting certain amounts that would be included in GAAP earnings, such as discrete tax items, without unreasonable effort.

| (in millions, except per share data) | | | | | | [removed: 2021 | | | | | |] [added: 2022] | | | [removed: 2020] | | | | | | | | | [added: 2021] | | | | | |

| Net income & Earnings per share | | | | | | $ | [removed: 427] [added: 355] | | [removed: $] | [removed: 2.35] | | [added: $] | [added: 1.96] | | [removed: $] | [removed: 254] | | $ | [removed: 1.40 | | | | | |] [added: 427] | | [added: $] | [added: 2.35] | |

| (Gain) loss from sale of [removed: business, net of tax benefit of $0 | | | | | | (2)] [added: business] | | | [removed: (0.01)] | | | [added: (1)] | | | [removed: —] | | | [removed: —] [added: (0.01)] | | | | | | [added: (2)] | | | [added: (0.01)] | | |

| Adjusted net income & Adjusted earnings per share | | | | | | $ | [removed: 452] [added: 516] | | [removed: $] | [removed: 2.49] | | [added: $] | [added: 2.85] | | [removed: $] | [removed: 374] | | $ | [removed: 2.06 | | | | | |] [added: 452] | | [added: $] | [added: 2.49] | |

▪“EBITDA” defined as earnings before interest, taxes, depreciation and amortization expense, "EBITDA margin" defined as EBITDA divided by total revenue, "adjusted EBITDA" reflects the adjustment to EBITDA to exclude share-based compensation charges, restructuring and realignment costs, special charges and [added: gain or loss from sale of businesses, and "adjusted EBITDA margin" defined as adjusted EBITDA divided by total revenue.]

▪“special charges" defined as costs incurred by the Company, such as acquisition and integration related costs, non-cash impairment charges and both operating and non-operating adjustments for costs related to the [removed: UK] [added: U.K.] pension plan buy-out.

| (in millions) | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | | | |

| Net cash provided by operating activities | | | | | | $ | [removed: 538] [added: 596] | | | | | [removed: $] [added: $] | [removed: 824] [added: 538] | | | | | | | |

| Capital expenditures | | | | | | (208) | | | | | | [removed: (183)] [added: (208)] | | | | | | | | |

| Free cash flow | | | | | | $ | [removed: 330] [added: 388] | | | | | $ | [removed: 641] [added: 330] | | | | | | | |

| Net cash used in investing activities | | | | | | $ | [removed: (183)] [added: (191)] | | | | | [removed: $] [added: $] | [removed: (169)] [added: (183)] | | | | | | | |

| Net cash provided (used) by financing activities | | | | | | $ | [removed: (855)] [added: (790)] | | | | | [removed: $] [added: $] | [removed: 473] [added: (855)] | | | | | | | |

Xylem reported revenue of [removed: $5,195] [added: $5,522] million for [removed: 2021,] [added: 2022,] an increase of [removed: $319] [added: $327] million, or [removed: 6.5%,] [added: 6.3%,] from [removed: $4,876] [added: $5,195] million reported in [removed: 2020.][added: 2021.]

On a constant currency basis, revenue increased by [removed: $197] [added: $586] million, or [removed: 4.0%,] [added: 11.3%,] during the year.

Operating income for [removed: 2021] [added: 2022] was [removed: $585] [added: $622] million, reflecting an increase of [removed: $218] [added: $37] million, or [removed: 59.4%,] [added: 6.3%,] compared to [removed: $367] [added: $585] million in [removed: 2020.][added: 2021.]

Operating margin [removed: benefited] [added: included unfavorable impacts of 40 basis points] from [removed: decreases] [added: increases] in special charges [removed: of $77 million] and [removed: decreases in] restructuring and realignment costs [removed: of $55 million during] [added: as compared to] the [added: prior] year.

Excluding the impact of these items, adjusted operating income was [removed: $611] [added: $672] million, with an adjusted operating margin of [removed: 11.8%] [added: 12.2%] in [removed: 2021] [added: 2022] as compared to adjusted operating income of [removed: $525] [added: $611] million with an adjusted operating margin of [removed: 10.8%] [added: 11.8%] in [removed: 2020,] [added: 2021,] an increase of [removed: 100] [added: 40] basis points.

Additional financial highlights for [removed: 2021] [added: 2022] include the following:

- Net cash provided by operating activities of [removed: $538] [added: $596] million and free cash flow of [removed: $330] [added: $388] million, [removed: down 49%] [added: up 18%] from [removed: 2020][added: 2021]

- Orders of [removed: $6,300] [added: $6,257] million, [removed: up 25.2%] [added: down 0.7%] from [removed: $5,033] [added: $6,300] million in [removed: 2020] [added: 2021] (up [removed: 22.6%] [added: 4.0%] on an organic basis)

- Dividends paid to shareholders increased [removed: 8%] [added: 7%] in [removed: 2021.][added: 2022.]

[removed: 2022] [added: 2023] Business Outlook

We anticipate total revenue growth in the range of [removed: 1% to] 3% [added: to 5%] in [removed: 2022,] [added: 2023,] with organic revenue growth anticipated to be in the range of [removed: 3%] [added: 4%] to [removed: 5%.][added: 6%.]

The following is a summary of our [removed: 2021] [added: 2022] organic revenue performance and [removed: 2022] [added: the 2023] organic revenue outlook by end market.

- Utilities revenue [removed: decreased] [added: increased] by approximately [removed: 3%] [added: 10%] for [removed: 2021] [added: 2022] on an organic basis driven by [removed: weakness in United States, partially offset by] strength in [added: the U.S. and] western Europe, [removed: with relatively flat growth] [added: partially offset by weakness] in the emerging markets.

For [removed: 2022,] [added: 2023,] we expect organic revenue growth in the low-single-digit [removed: range as utilities remain][added: range.]

- Industrial revenue increased by approximately [removed: 14%] [added: 13%] for [removed: 2021] [added: 2022] on an organic basis driven by strength across all major geographic regions.

For [removed: 2022,] [added: 2023,] we expect organic revenue growth in the [added: low to] mid-single-digit [removed: range as activity rebounds globally.][added: range.]

The Company has taken specific actions to mitigate these inflationary headwinds, including pricing actions to pass cost increases through to customers and productivity efforts, including selective chip allocation, product redesigns, alternate sourcing options, and global procurement efforts.

We have also initiated and plan to continue to initiate restructuring actions in 2023 to further optimize our cost structure.

Evoqua Acquisition

On January 23, 2023, Xylem entered into a definitive agreement under which Xylem will acquire Evoqua, a leader in mission-critical water treatment solutions and services, in an all-stock transaction that reflects an implied enterprise value of approximately $7.5 billion.

The transaction, which is anticipated to close in mid-2023, is subject to approval by shareholders of Xylem and Evoqua, the receipt of required regulatory approvals and other customary closing conditions.

Evoqua, a leader in North America water treatment, complements Xylem’s distinctive portfolio of solutions with advanced water and wastewater treatment capabilities, a powerful and extensive network of service professionals and access to a number of attractive industrial markets with resilient, recurring revenue streams.

Excluding revenue,

| Restructuring and realignment | | | | | | 34 | | | | | | 0.19 | | | | | | 22 | | | 0.12 | | |

| Special charges | | | | | | 160 | | | (a) | | | 0.89 | | | | | | 12 | | | 0.07 | | |

| Tax effects of adjustments (b) | | | | | | (32) | | | (c) | | | $ | (0.18) | | | | | $ | (7) | | $ | (0.04) | |

| | | |

| --- | --- | --- |

| (a) The special charges in the year primarily relate to the U.K. pension settlement expense of $140 million and asset impairment charges of $14 million recorded in the period. | | |

| (b) The tax effects of adjustments are calculated using the statutory tax rate, taking into consideration the nature of the item and the relevant taxing jurisdiction. | | |

| (c) The $32 million in tax effects of adjustments in the period primarily consists of $23 million related to the U.K. pension settlement expense and $3 million related to the asset impairment charge. | | |

Operating margin was 11.3% for both 2022 and 2021.

- Net income of $355 million, or $1.96 per diluted share, down 16.6% ($516 million or $2.85 per diluted share on an adjusted basis, up 14.5% from 2021)

On the clean water side, we expect improvements in chip supply through 2023 allowing for large deal deployments already secured in our backlog.

Additionally, we can expect continued momentum for water quality products and increased demand for pipeline assessment services due to aging infrastructure.

We expect wastewater utilities to remain focused on mission-critical applications in wastewater.

Long-term capital expenditure outlook is strong due to aging infrastructure and the emerging markets’ continued advancement.

We expect to see continued robust growth in our dewatering business, driven by mining demand and strategic growth investments.

We expect sustained demand in light industrial activity globally.

- In the commercial market, organic revenue in 2022 increased by approximately 12%, led by growth in the U.S and western Europe.

We expect sustained demand for energy efficient related projects, particularly in Europe, and continued commercial development in the emerging markets, partially offset by moderation in new construction.

- In the residential market, organic revenue increased by approximately 16% in 2022 driven primarily by strength in the U.S. as well as strength in the emerging markets.

For 2023, we expect a low-single-digit organic revenue decline due to normalizing demand in the U.S., partially offset by continued strength in emerging markets.

We are strongly positioned to deliver on our 2023 commitments with commercial and operational momentum.

We expect resilient demand due to our differentiated solutions addressing long-term secular trends in our largest end markets.

Our 2023 commitments are supported by backlog execution, price realization, continued productivity actions to more than offset the impact of persistent inflation and potential headwinds from slowing demand in our most cyclical end markets.

Beyond 2023, we remain on track to deliver our longer-term strategic and financial milestones.

In addition to our organic 2023 commitments, we expect to successfully integrate the planned merger of Xylem and Evoqua with a closing estimated by mid-2023.

| Revenue | | | | | | $ | 5,522 | | | | | $ | 5,195 | | | | | | | | | | | 6.3 | | % | | | | | | |

| U.K. pension settlement expense | | | | | | 140 | | | | | | — | | | | | | | | | | | | NM | | | | | | | | |

| Gain from sale of business | | | | | | 1 | | | | | | 2 | | | | | | | | | | | | (50.0) | | % | | | | | | |

| Net income | | | | | | $ | 355 | | | | | $ | 427 | | | | | | | | | | | (16.9) | | % | | | | | | |

The increase at constant currency was driven by an increase in organic revenue of $595 million, reflecting strong organic growth in all end markets as well as across all major geographic regions.

| Organic Impact | | | 266 | | | 11.8 | | % | | | | 220 | | | 13.6 | | % | | | | 109 | | | 8.2 | | % | | | | 595 | | | 11.5 | | % |

| Constant Currency | | | 266 | | | 11.8 | | % | | | | 220 | | | 13.6 | | % | | | | 100 | | | 7.5 | | % | | | | 586 | | | 11.3 | | % |

| Foreign currency translation (a) | | | (149) | | | (6.6) | | % | | | | (66) | | | (4.1) | | % | | | | (44) | | | (3.3) | | % | | | | (259) | | | (5.0) | | % |

Xylem’s COVID-19 Response Team is responsible for Xylem's Pandemic Plan.

The Pandemic Plan is designed to aid in prevention, preparedness, response and recovery at our sites and across the Company.

Public health officials have recommended, or governments have mandated, precautions to mitigate the spread of COVID-19, including travel restrictions, quarantine guidelines, or similar measures in many of the areas in which we operate.

As a result, a number of our production facilities across the globe experienced reduced production levels due to such measures to varying degrees during the year, however our current overall operating capacity approximates normal levels globally.

In order to maintain a safe work environment, our production facilities continue to spread operations over multiple shifts and implement other protective measures such as testing, temperature screening and social distancing, while maintaining operational capabilities.

To some extent, we have been able to pass cost increases through to customers.

We have seen a recovery in demand for our products.

At the end of 2021, total backlog increased 52.6% as compared to December 31, 2020.

In response to the changes in business and economic conditions arising as a result of the COVID-19 pandemic, management committed to restructuring activities across our businesses and functions globally during the second quarter of 2020.

These initiatives were designed to support our long-term financial resilience and simplify our operations, strengthen our competitive positioning and better serve our customers.

Since the pandemic started, Xylem has taken measures to protect the health and safety of our employees, work with our customers to minimize potential disruptions and positively impact our communities.

In the first quarter of 2020, we implemented a support pay program for employees impacted by COVID-19, which is in place through the second quarter of 2022 and will be evaluated for continuation, as necessary.

Xylem Watermark, our corporate social responsibility program, continues to support our communities in addressing the challenges posed by this global pandemic by strengthening access to Water, Sanitation and Hygiene (WASH) facilities in schools and health centers through its partnership with Americares and UNICEF, as well as the Partner Community Grants program and matching donations program for employees and partners, and other philanthropic commitments.

Our COVID-19 Response Team applies a set of health and safety guidelines for employees working in Xylem offices.

We continue to assess the evolving nature of the pandemic and its possible implications to our business, employees, supply chain, customers and communities, and to take actions in an effort to mitigate adverse consequences.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Restructuring and realignment, net of tax of $5 and $17 | | | | | | 17 | | | 0.09 | | | | | | 60 | | | 0.33 | | | | | | | | | | | |

| Special charges, net of tax of $2 and $10 | | | | | | 10 | | | 0.06 | | | | | | 76 | | | 0.42 | | | | | | | | | | | |

| Tax-related special items | | | | | | — | | | — | | | | | | (16) | | | (0.09) | | | | | | | | | | | |

gain or loss from sale of businesses, and "adjusted EBITDA margin" defined as adjusted EBITDA divided by total revenue.

The increase at constant currency was driven by an increase in organic revenue of $210 million reflecting strong organic growth in the industrial, commercial and residential end markets, partially offset by organic declines in utilities, largely as a result of component shortages in our Measurement & Controls Solutions segment.

Operating margin was 11.3% for 2021 versus 7.5% for 2020, an increase of 380 basis points.

The increase in adjusted operating margin was primarily due to cost reductions from our productivity, restructuring and other cost saving initiatives, favorable volume and price realization.

These impacts were partially offset by cost inflation and increased spending on strategic investments.

- Net income of $427 million, or $2.35 per diluted share ($452 million or $2.49 per diluted share on an adjusted basis, up 20.9% from 2020)

focused on mission-critical applications.

We expect uneven growth from China and India as multi-year government funding programs are deployed.

The timing of large clean water utility project deployments has been impacted by the global shortage of electronic components.

We anticipate that these deployments will ramp up when supply constraints ease in the second half of 2022 based on our strong backlog position and orders momentum.

Additionally, we expect healthy momentum in the global test and treatment markets with rising demand and focus on pipeline assessment services and increased demand for our smart water solution and digital offerings.

We continue to see healthy growth in our dewatering business, especially in the emerging markets from mining demand as well as in the U.S. and Europe reflecting our strong orders and backlog.

We expect continued solid replacement business in the U.S. and an acceleration of construction activity.

In Europe we expect modest share gains, with demand for eco-friendly products supported by increase in funding for green buildings.

For 2022, we expect organic revenue growth in the low-single-digit to mid-single-digit range.

We anticipate demand and activity to moderate and remain healthy from increased residential users in the U.S. and western Europe.

Additionally, we continue to anticipate strong demand in China for secondary water supply product applications.

We plan to continue to take actions and focus spending in 2022 on areas that allow us to make progress on our strategic priorities as well on our top priorities for 2022, which include converting our strong demand momentum into top-line growth by maximizing chip allocation and price realization, continuing our commitment to deliver margin expansion by mitigating supply chain and inflation headwinds and executing on strategic capital deployment opportunities.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Revenue | | | | | | $ | 5,195 | | | | | $ | 4,876 | | | | | | | | | | | 6.5 | | % | | | | | | |

Our financial results can be difficult to predict.

Our business is impacted by a substantial amount of short cycle and book-and-bill business, which we have limited insight into, particularly for the business that we transact through our significant distribution network.

Our businesses, including that of our Measurement & Control Solutions segment, are also impacted by our long-cycle business, including large projects, which could be unexpectedly cancelled, or whose timing can change based upon customer requirements due to a number of factors affecting the project that are beyond our knowledge or control, such as funding, readiness of the project and regulatory approvals.

We rely on a complex global supply chain, which has been subject to dynamic conditions, volatility, unexpected changes and disruptions due to international conditions, including as a result of the war between Russia and Ukraine, the COVID-19 pandemic and macroeconomic conditions, including high inflation.

These supply chain challenges have affected, and may continue to affect, our cost structure, production and ability to timely fill customer orders.

We cannot predict when, or if, these conditions will ease or subside in the future.

Accordingly, our financial results for any given period have been and will continue to be difficult to predict.

We may incur additional impairment charges for our goodwill and other indefinite-lived intangible assets which would negatively impact our operating results.

We have a significant amount of goodwill and purchased intangible assets on our balance sheet as a result of acquisitions.

As of December 31, 2022, the net carrying value of our goodwill and other indefinite-lived intangible assets totaled approximately $3 billion.

In accordance with generally accepted accounting principles, we evaluate these assets for impairment at least annually, or more frequently if changes in events or circumstances indicate it is more likely than not that a potential impairment could exist.

Significant negative industry or economic trends, disruptions to our business or our customers’ business, inability to effectively integrate or scale acquired businesses, increases in cost of capital, unexpected significant changes or planned changes in use of the assets, failure of the FCC to renew radio spectrum licenses, and divestitures and market capitalization declines may cause impairment of our goodwill and other indefinite-lived intangible assets.

For example, in 2020 we recorded goodwill impairment charges $58 million within our Measurement & Control Solutions segment primarily related to the performance of the business of the Pure Technologies Ltd. acquisition ("Pure") (as detailed in Note 11, “Goodwill and Other Intangible Assets”).

We did not record goodwill impairment charges within our Measurement & Control Solutions segment in 2021 or 2022.

Material impairment charges have in the past and could in the future adversely affect our results of operations and financial condition.

Changes in our effective tax rates and tax expenses may adversely affect our financial results.

We sell our products in approximately 150 countries and 53% of our revenue was generated outside the U.S. for the year ended December 31, 2022.

Given the global nature of our business, a number of factors may increase our effective tax rates and tax expense, including:

- the geographic mix of jurisdictions in which profits are earned and taxed;

- the statutory tax rates and tax laws in jurisdictions in which we conduct business;

- the resolution of tax issues arising from tax examinations by various tax authorities; and

- the valuation of our deferred tax assets and liabilities.

Additionally, tax laws, regulations, and administrative practices in various jurisdictions may be subject to significant change, with or without notice, due to economic, political, and other conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes.

The recent agreement by countries in the Organization for Economic Cooperation and Development to implement additional legislative changes increases the uncertainty of future income tax positions, and such changes may result in additional tax expense and effective tax rate volatility.

Our businesses are regularly examined by various tax authorities throughout the world and the resolutions of these examinations do not typically have a significant impact on our effective tax rates and tax expenses, but they could.

For example, following an examination regarding aspects of the reorganization of our European business that occurred in 2013, the Swedish tax authority issued a tax assessment to Xylem’s Swedish subsidiary in 2019, which we are appealing as further described in Note 6, “Income Taxes.” This examination as well as other examinations can result in increased tax assessments, and settlement or litigation about the assessments and final resolution could be unfavorable to Xylem.

We regularly assess the likelihood of favorable or unfavorable outcomes resulting from these examinations to determine the adequacy of our provision for income taxes, including unrecognized tax benefits; however, developments in an audit or litigation could materially and adversely affect us.

Although we

believe our tax estimates and accruals are reasonable, there can be no assurance that any final determination will not be materially different than the treatment reflected in its historical income tax provisions, accruals and unrecognized tax benefits, which could materially and adversely affect our business, operating results, cash flows and financial condition.

Our pension and other defined benefit plans are subject to financial market risks that could adversely impact our earnings, financial condition and cash flows in future periods.

Certain current and retired employees are covered by pension and other defined benefit plans (collectively, “post-retirement benefit plans”).

We make contributions to fund our post-retirement benefit plans when we consider it necessary or advantageous to do so.

Significant changes in market interest rates, decreases in fair value of or investment losses on plan assets, changes in discount rates, or changes in minimum funding requirements established by governments, taxing authorities or other agreements, could increase our funding obligations and adversely impact our earnings, financial condition and cash flows in future periods.

In addition, the cost of our post-retirement benefit plans is incurred over long periods of time and involves factors that can be volatile and unpredictable, including rates of return on plan assets, discount rates used to calculate liabilities and expenses, change in laws and regulatory actions, and changes in actuarial experience and assumptions, which could adversely impact our earnings, results of operations, financial condition and cash flows.

Our debt obligations may adversely affect our business and our ability to meet our obligations and pay dividends.

As of December 31, 2022, our total outstanding indebtedness was $1,880 million as described under “Liquidity and Capital Resources" and we may incur additional debt in the future.

Our current or future indebtedness could have adverse consequences to us and our investors, including:

- increasing our vulnerability to general adverse economic and industry conditions;

- limiting our ability to obtain additional financing or borrow additional funds;

- reducing or eliminating our ability to pay future dividends or repurchase our common stock;

We are exposed to market risk, primarily related to foreign currency exchange rates and interest rates.

These exposures are actively monitored by management.

Our exposure to foreign exchange rate risk is due to certain costs, revenue and borrowings being denominated in currencies other than one of our subsidiaries' functional currency.

Similarly, we are exposed to market risk as a result of changes in interest rates which may affect the cost of our financing.

It is our policy and practice to use derivative financial instruments only to the extent necessary to manage exposures.

Foreign Currency Exchange Rate Risk

Approximately 56% of our 2021 revenues were from customers in various locations outside the U.S.

Our economic foreign currency risk primarily relates to receipts from customers, payments to suppliers and intercompany transactions denominated in foreign currencies.

We may use derivative financial instruments to offset risk related to receipts from customers and payments to suppliers, when it is believed that the exposure will not be limited by our normal operating and financing activities.

We enter into currency forward contracts periodically in order to manage the exchange rate fluctuation risk on certain intercompany transactions associated with third-party sales and purchases.

These risks are also mitigated by natural hedges including the presence of manufacturing facilities outside the U.S., global sourcing and other spending which occurs in foreign countries.

Our principal foreign currency transaction exposures primarily relate to the Euro, Swedish Krona, British Pound, Canadian Dollar, Australian Dollar, and Polish Zloty.

We estimate that a hypothetical 10% movement in foreign currency exchange rates would not have a material economic impact to Xylem’s financial position and results of operations.

Additionally, we are subject to foreign exchange translation risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. Dollar.

The translation risk is primarily concentrated in the exchange rate between the U.S. Dollar and the Euro, Chinese Yuan, British Pound, Canadian Dollar, Australian Dollar, Swedish Krona, and Indian Rupee.

As the U.S. Dollar strengthens against other currencies in which we transact business, revenue and income will generally be negatively impacted, and if the U.S. Dollar weakens, revenue and income will generally be positively impacted.

We expect to continue to generate significant revenue from non-U.S. operations and we expect our cash will be predominately held by our foreign subsidiaries.

We expect to manage our worldwide cash requirements considering available funds among the many subsidiaries through which we conduct business and the cost effectiveness with which those funds can be accessed.

We may transfer cash from certain international subsidiaries to the U.S. and other international subsidiaries when it is cost-effective to do so, though we continually review our domestic and foreign cash profile, expected future cash generation and investment opportunities and reassess whether there is a need to repatriate funds held internationally to support our U.S. operations.

We also hedge our investment in certain foreign subsidiaries via the use of cross-currency swaps and the designation of our 2.25% Senior Notes of €500 million aggregate principal amount due March 2023 as a net investment hedge.

Accordingly, we estimate that a 10% movement of the U.S. Dollar to various foreign currency exchange rates we translate from, in aggregate would not have a material economic impact on our financial position and results of operations.

Interest Rate Risk

As of December 31, 2021, our long-term debt portfolio is primarily comprised of five series of fixed-rate senior notes that total approximately $2.5 billion.

The senior notes are not exposed to interest rate risk as the bonds are at a fixed rate until maturity.

Based on the current interest rate market we do not anticipate material risk associated with our debt refinancing within the target time frame of maturity.

Commodity Price Exposures

For a discussion of risks relating to commodity prices, refer to “Item 1A.

Risk Factors.”

Xylem is a leading global water technology company with [removed: 2021] [added: 2022] revenues of [removed: $5.2] [added: $5.5] billion and approximately [removed: 17,300 employees worldwide, of which approximately 1,200 were temporary or fixed-term] [added: 17,800] employees [removed: or interns.][added: worldwide.]

We have differentiated market positions in core application areas including transport, treatment, dewatering, [removed: test,] [added: analytic instrumentation and measurement,] smart metering, infrastructure assessment services, digital software solutions for utilities, [added: and applied water systems for] commercial and residential building services and industrial processes.

- A substantial global installed base across the water cycle that provides for steady recurring [added: and replacement] revenue

We estimate the total addressable market size of the global water industry, excluding operational expenditures related to labor, energy, and chemicals, to be approximately [removed: $600] [added: $700] billion.

[removed: ][added: ]

- Drive Customer Success. We seek to partner with customers to meet their stakeholders’ needs through our broad portfolio of [removed: unmatched] products, services and solutions.

Third, we seek to help customers get the most out of their systems by providing world-class services that [removed: ensure] [added: enable increased] uptime, efficiency and resilience.

We will continue building innovation, product management and engineering teams in these regions, expanding our market coverage in key growth markets such as China, India, Eastern [removed: Europe] [added: Europe, Latin America] and Africa.

- Strengthen Innovation and Technology. We seek to create new customer offerings that help them solve water challenges more powerfully than ever before, while also providing our company with rapid growth [added: opportunities.]

- Cultivate Leadership and Talent Development. We continue to foster an empowering, mission-driven, [removed: diverse] [added: diverse, equitable] and inclusive culture.

See Note [removed: 22,] [added: 21,] “Segment and Geographic Data,” in our consolidated financial statements for financial information about segments and geographic areas.

| | | | | | | Market Applications | | | | | | [removed: 2021] [added: 2022] Revenue (in millions) | | | | | | % Revenue | | | | | | Major Products | | | | | | Primary Brands | | |

| Water Infrastructure | | | | | | Transport | | | | | | $ | [removed: 1,816] [added: 1,943] | | | | | [removed: 81] [added: 82] | | % | | | | • Water and wastewater pumps • Filtration, disinfection and biological treatment equipment • Mobile dewatering equipment [added: and rental services] | | | | | | • Flygt • Godwin • Leopold • Sanitaire • Wedeco • Xylem Vue | | |

| Applied Water | | | | | | Commercial Building Services | | | | | | $ | [removed: 609] [added: 659] | | | | | [removed: 38] [added: 37] | | % | | | | • Pumps • Valves • Heat exchangers • Controls • Dispensing equipment systems | | | | | | • A-C Fire Pump • Bell & Gossett • Flojet • Goulds Water Technology • Jabsco • Lowara • Standard Xchange • Xylem Vue | | |

| | | | Residential Building Services | | | | | | [removed: 268] [added: 306] | | | | | | 17 | | % | | | | | | | | | | | | | | | |

| | | | Industrial Water | | | | | | [removed: 736] [added: 802] | | | | | | [removed: 45] [added: 46] | | % | | | | | | | | | | | | | | | |

| Measurement & Control Solutions | | | | | | Water | | | | | | $ | [removed: 1,055] [added: 1,126] | | | | | [removed: 79] [added: 81] | | % | | | | • Smart meters • Networked communication devices • Data analytics • Test equipment • Controls • Sensor devices • Software & managed services • Critical infrastructure services | | | | | | • Pure [added: Technologies] • Sensus • Smith Blair • WTW • YSI • Xylem Vue | | |

The industrial market includes customers that require similar water and wastewater infrastructure [removed: networks] [added: applications] to support various industrial operations.

Our key competitors in the Water Infrastructure segment include KSB Inc., Sulzer Ltd., [removed: Evoqua Water Technologies,] [added: Grundfos,] United Rentals, Trojan (Danaher Corporation) and [removed: Grundfos.][added: Evoqua.]

[removed: These applications] [added: Applied Water encompasses the uses of water to] serve a diverse set of customers in the commercial, residential and industrial end markets.

The industrial market includes [removed: OEMs,] [added: original equipment manufacturers ("OEMs"),] exploration and production firms, and developers and managers of industrial facilities, such as electrical power generators, chemical manufacturers, machine shops, clothing manufacturers, marine, food and beverage companies and car washes.

Population [removed: growth, urbanization regulatory requirements] [added: growth and urbanization, climate and regulation] on energy [removed: efficiency] [added: efficiency,] and [removed: eco-friendly buildings] [added: digitalization enabling self-service and preventive maintenance] are macro growth drivers of these markets, driving the need for housing, food, community services and retail goods within growing city centers.

The segment delivers communications, smart metering, measurement and control [removed: technologies] [added: capabilities] and critical infrastructure technologies that allow customers to more effectively use their distribution networks for the delivery, monitoring and control of critical resources such as water, electricity and natural gas.

We also provide analytical instrumentation used to measure and analyze water [added: quality, flow and level in clean water, wastewater, outdoor water environments.]

Our [removed: Advanced Infrastructure Analytics platform complements] [added: digital software solutions complement] these offerings with intelligent [removed: solutions] [added: applications] that help utility decision-makers manage and maintain their networks more effectively in real time.

We set ourselves apart in the industry by focusing on our communication network, innovation, new product development and service offerings that deliver tangible savings [added: from efficiency] of [added: operating costs in meter reading and billing as well as reduction of] non-revenue water through improved meter accuracy, reduced theft and identification of leaks.

Our key competitors in the Measurement & Control Solutions segment include Itron, Badger Meter, Landis+Gyr, Neptune (Roper), [removed: Elster (Honeywell),] [added: Kamstrup,] Echologics (Mueller Water Products), Hach (Danaher Corporation) and Teledyne.

| (in millions) | | | [removed: 2021] [added: 2022] | | | | | | | | | | | | [removed: 2020] [added: 2021] | | | | | | | | | | | | [removed: 2019] [added: 2020] | | | | | | | | |

| United States | | | $ | [removed: 2,280] [added: 2,573] | | | | | [removed: 44] [added: 47] | | % | | | | $ | [removed: 2,297] [added: 2,280] | | | | | [removed: 47] [added: 44] | | % | | | | $ | [removed: 2,554] [added: 2,297] | | | | | [removed: 49] [added: 47] | | % |

| Western Europe | | | [removed: 1,414] [added: 1,411] | | | | | | [removed: 27] [added: 26] | | % | | | | [removed: 1,259] [added: 1,414] | | | | | | [removed: 26] [added: 27] | | % | | | | [removed: 1,235] [added: 1,259] | | | | | | [removed: 24] [added: 26] | | % |

| Emerging Markets (a) | | | [removed: 1,066] [added: 1,074] | | | | | | [removed: 21] [added: 19] | | % | | | | [removed: 919] [added: 1,066] | | | | | | [removed: 19] [added: 21] | | % | | | | [removed: 1,049] [added: 919] | | | | | | [removed: 20] [added: 19] | | % |

| Other | | | [removed: 435] [added: 464] | | | | | | 8 | | % | | | | [removed: 401] [added: 435] | | | | | | 8 | | % | | | | [removed: 411] [added: 401] | | | | | | [removed: 7] [added: 8] | | % |

| Total | | | $ | [removed: 5,195] [added: 5,522] | | | | | | | | | | | $ | [removed: 4,876] [added: 5,195] | | | | | | | | | | | $ | [removed: 5,249] [added: 4,876] | | | | | | | |

Parts and raw materials commonly used in our products include motors, fabricated parts, castings, [added: magnets,] bearings, seals, batteries, printed circuit boards ("PCBs") and electronic components, including semiconductors, as well as commodities, including steel, brass, nickel, copper, aluminum and plastics.

While we may recover some cost increases through operational improvements, we are still exposed to pricing risk, including [added: due to duty and tariff assessments by the U.S. or other governments on foreign imports.]

We [removed: may experience] [added: have experienced] price volatility or supply constraints [removed: for] [added: when] materials [removed: that are] [added: have] not [added: been] available from multiple sources.

No individual customer accounted for more than 10% of our consolidated revenues in [removed: 2021, 2020] [added: 2022, 2021] or [removed: 2019.][added: 2020.]

Total backlog was [removed: $3,240] [added: $3,605] million at December 31, [removed: 2021] [added: 2022] and [removed: $2,124] [added: $3,240] million at December 31, [removed: 2020.][added: 2021.]

We anticipate that approximately [removed: 60%] [added: 55%] of the backlog at December 31, [removed: 2021] [added: 2022] will be recognized as revenue during [removed: 2022.][added: 2023.]

In addition to investments made in software development, which were capitalized, we incurred [removed: $204] [added: $206] million, [removed: $187] [added: $204] million, and [removed: $191] [added: $187] million as a result of R&D investment spending in [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019,] [added: 2020,] respectively.

| | | | Treatment | | | | | | 421 | | | | | | 18 | | % | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | $ | 2,364 | | | | | 100 | | % | | | | | | | | | | | | |

| | | | | | | | | | | | | $ | 1,767 | | | | | 100 | | % | | | | | | | | | | | | |

| | | | Energy | | | | | | 265 | | | | | | 19 | | % | | | | | | | | | | | | | | | |

| | | | | | | | | | $ | 1,391 | | | | | 100 | | % | | | | | | | | | | | | | | | |

Our YSI and WTW-branded instruments have a strong position in the analytical instrumentation market and provide critical readings of various water quality, level and flow parameters for customers.

We provide a differentiated offering in the reliability and accuracy of our products often in rugged, remote, and hazardous locations.

partnerships with academic institutions as well as other technology firms, start-up accelerators and venture capital organizations.

In 2022, we submitted our 2030 GHG reduction targets to the Science Based Target Initiative for validation.

As of year end, these are currently under review.

In 2022, we announced investments in CNote’s Impact Cash™ platform, a mechanism through which we invest and deposit cash at scale in community finance institutions that strengthen and transform underserved communities.

As of December 31, 2022, Xylem employed approximately 17,800 employees worldwide.

Our approach currently includes a periodic comprehensive global survey, shorter pulse surveys and listening sessions.

One of our strategies for becoming a more diverse organization—and incorporating broader experiences, skill sets, and perspectives into our work—is expanding sourcing channels for diverse talent through external diversity partnerships and affiliations.

In our 2021 employee engagement survey, we sought specific feedback from our colleagues on their efforts to manage stress and disconnect from work and, based on the survey responses, we have augmented our holistic well-being strategies, including providing mental health awareness training to our people leaders, which more than 500 people managers have participated in, and expanding our Employee Assistance Program support across the globe.

In response to the ongoing crisis in Ukraine, we continue to provide financial and logistical support to our colleagues and partners in Ukraine, including travel assistance and temporary accommodations near our facilities in Poland.

In 2022, for our U.S. colleagues, we enhanced our paid parental leave and short-term disability coverage, provided for flexible time off, and expanded our health and welfare benefits, including with respect to reproductive care.

We are currently conducting a pay equity assessment based on gender and U.S. minority classifications and will use the results of this assessment to continue to support our commitment to equitable pay by role.

We continue to expand our long-term incentive program to reach deeper in the organization to recognize key talent and top performers and attract and retain digital technology talent.

We are continuing to explore ways to help our colleagues thrive in a variety of work settings and have formalized guidelines that support remote and hybrid work.

To better support our colleagues in a more flexible workplace, we also provide high-touch global onboarding and leverage collaboration technologies.

We are committed to enhancing colleagues’ capabilities needed for the Company to win in the marketplace.

opportunities.

| | | | Treatment | | | | | | 431 | | | | | | 19 | | % | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | $ | 2,247 | | | | | 100 | | % | | | | | | | | | | | | |

| | | | | | | | | | | | | $ | 1,613 | | | | | 100 | | % | | | | | | | | | | | | |

| | | | Energy | | | | | | 280 | | | | | | 21 | | % | | | | | | | | | | | | | | | |

| | | | | | | | | | $ | 1,335 | | | | | 100 | | % | | | | | | | | | | | | | | | |

Applied Water encompasses the uses of water in two primary applications: Building Services and Industrial Water.

quality, flow and level in clean water, wastewater, surface water and coastal environments.

due to duty and tariff assessments by the U.S. or other governments on foreign imports.

We believe that our patents and applications are important for maintaining the competitive differentiation of our products and improving our return on R&D investments.

As of December 31, 2021, Xylem employed approximately 17,300 employees worldwide, of which approximately 1,200 were temporary or fixed-term employees or interns.

As of February 25, 2022, 50% of our directors have origins outside the U.S., and 50% of our directors also identify as diverse from a gender, ethnic or racial standpoint.

Approximately 17% of our senior leadership team members have origins outside the U.S., and approximately 42% of our senior leadership team also identify as diverse from a gender, ethnic or racial standpoint.

We provide periodic training on diversity, equity and inclusion globally, including for our senior leaders.

These groups are a critical part of Xylem’s diversity, equity and inclusion strategy and empower colleagues.

Each group has a collective voice to speak with management, including the opportunity to voice concerns as a community and to drive change and advance inclusion and innovation.

In addition, our CEO and senior leadership team hold regular global town hall meetings, as well as smaller regional or local town halls, to share and hear from our colleagues across all areas of the Company and geographies.

In response to the COVID-19 pandemic, we continue to take additional measures to protect the health, safety and well-being of our colleagues, including a support pay program for colleagues impacted by the pandemic which remained in place throughout 2021, an essential services support pay program for colleagues whose roles were classified as an “essential service” requiring work on-site at a Xylem facility or in the field supporting customers, and the transition of office-based colleagues to remote work-from-home status where possible, which enabled us to minimize disruptions to our operations and continue to support our customers.

In addition, our senior leadership team held listening sessions with colleagues who were also caregivers to understand their unique challenges and evolve our support accordingly.

In order to maintain a safe work environment for our colleagues, our production facilities spread out operations over multiple shifts and implemented other protective measures, such as temperature screening and social distancing, while maintaining operational capabilities.

In response to our 2021 employee engagement survey, we sought specific feedback on mental well-being and are augmenting our holistic well-being strategies as a result.

Attracting, motivating and retaining talented colleagues worldwide is essential to the success of our business.

Accordingly, we endeavor to provide our colleagues with competitive compensation and benefits, including paid parental leave in the United States.

Accordingly, in 2021, the Company expanded its sustainability-linked compensation for all

We are committed to enhancing colleagues’ capabilities needed to win in the marketplace and are focused on enhancing digital literacy, sales effectiveness, and other skills needed to support execution of our strategy.

*Workplace Flexibility*

In response to the COVID-19 pandemic, our colleagues discovered innovative ways to engage customers and suppliers, and collaborate with each other on complex global or cross-functional projects, adapted to stay strong and productive, and remained highly engaged and committed to our vision as a Company.

This agility has also helped us see new business capabilities and ways of working together.

We are committed to preparing and enabling both management and our colleagues for this new way of working, while we continue to foster an inclusive, equitable culture that promotes engagement, innovation, performance and trust, including for our on-site manufacturing and field services colleagues.

Our experience supports our core belief that a favorable, collaborative work environment with direct communication between employees and management serves not only the interests of employees but also the interests of Xylem as a company.

See Note [removed: 20,] [added: 19,] "Commitments and Contingencies", of the consolidated financial statements included in Item 8 of Part II of this 10-K for information regarding certain legal and regulatory proceedings we are involved in.

| | | | | | | For the fiscal year ended | | | December 31, [removed: 2021] [added: 2022] | | | | | | | | |

The aggregate market value of the common stock of the registrant held by non-affiliates of the registrant as of June 30, [removed: 2021] [added: 2022] was approximately [removed: $22.6] [added: $14.0] billion.

As of February [removed: 18, 2022,] [added: 17, 2023,] there were [removed: 179,901,139] [added: 180,278,376] outstanding shares of the registrant’s common stock, par value $0.01 per share.

Portions of the registrant’s definitive proxy statement for its [removed: 2022] [added: 2023] Annual Meeting of Shareowners, to be held in May [removed: 2022,] [added: 2023,] are incorporated by reference into Part II and Part III of this Report.

For the fiscal year ended December 31, [removed: 2021][added: 2022]

| 1A. | | | [Risk [removed: Factors](#i6443bec7a7e647908001f0dc8cad9dcc_16)] [added: Factors](#ice21da0ba68f43349fe99c1e37b9f2e3_16)] | | | [removed: [15](#i6443bec7a7e647908001f0dc8cad9dcc_16)] [added: [17](#ice21da0ba68f43349fe99c1e37b9f2e3_16)] | | |

| 1B. | | | [Unresolved Staff [removed: Comments](#i6443bec7a7e647908001f0dc8cad9dcc_19)] [added: Comments](#ice21da0ba68f43349fe99c1e37b9f2e3_19)] | | | [removed: [27](#i6443bec7a7e647908001f0dc8cad9dcc_19)] [added: [30](#ice21da0ba68f43349fe99c1e37b9f2e3_19)] | | |

| 3 | | | [Legal [removed: Proceedings](#i6443bec7a7e647908001f0dc8cad9dcc_25)] [added: Proceedings](#ice21da0ba68f43349fe99c1e37b9f2e3_25)] | | | [removed: [28](#i6443bec7a7e647908001f0dc8cad9dcc_25)] [added: [31](#ice21da0ba68f43349fe99c1e37b9f2e3_25)] | | |

| 4 | | | [Mine Safety [removed: Disclosures](#i6443bec7a7e647908001f0dc8cad9dcc_28)] [added: Disclosures](#ice21da0ba68f43349fe99c1e37b9f2e3_28)] | | | [removed: [29](#i6443bec7a7e647908001f0dc8cad9dcc_28)] [added: [32](#ice21da0ba68f43349fe99c1e37b9f2e3_28)] | | |

| * | | | [Information about our Executive [removed: Officers](#i6443bec7a7e647908001f0dc8cad9dcc_31)] [added: Officers](#ice21da0ba68f43349fe99c1e37b9f2e3_31)] | | | [removed: [29](#i6443bec7a7e647908001f0dc8cad9dcc_31)] [added: [33](#ice21da0ba68f43349fe99c1e37b9f2e3_31)] | | |

| | | | [Board of [removed: Directors](#i6443bec7a7e647908001f0dc8cad9dcc_34)] [added: Directors](#ice21da0ba68f43349fe99c1e37b9f2e3_34)] | | | [removed: [30](#i6443bec7a7e647908001f0dc8cad9dcc_34)] [added: [34](#ice21da0ba68f43349fe99c1e37b9f2e3_34)] | | |

| 5 | | | [Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i6443bec7a7e647908001f0dc8cad9dcc_40)] [added: Securities](#ice21da0ba68f43349fe99c1e37b9f2e3_40)] | | | [removed: [31](#i6443bec7a7e647908001f0dc8cad9dcc_40)] [added: [35](#ice21da0ba68f43349fe99c1e37b9f2e3_40)] | | |

| 7 | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i6443bec7a7e647908001f0dc8cad9dcc_46)] [added: Operations](#ice21da0ba68f43349fe99c1e37b9f2e3_46)] | | | [removed: [34](#i6443bec7a7e647908001f0dc8cad9dcc_46)] [added: [38](#ice21da0ba68f43349fe99c1e37b9f2e3_46)] | | |

| 7A. | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#i6443bec7a7e647908001f0dc8cad9dcc_58)] [added: Risk](#ice21da0ba68f43349fe99c1e37b9f2e3_58)] | | | [removed: [55](#i6443bec7a7e647908001f0dc8cad9dcc_58)] [added: [59](#ice21da0ba68f43349fe99c1e37b9f2e3_58)] | | |

| 8 | | | [Financial Statements and Supplementary [removed: Data](#i6443bec7a7e647908001f0dc8cad9dcc_61)] [added: Data](#ice21da0ba68f43349fe99c1e37b9f2e3_61)] | | | [removed: [56](#i6443bec7a7e647908001f0dc8cad9dcc_61)] [added: [60](#ice21da0ba68f43349fe99c1e37b9f2e3_61)] | | |

| 9 | | | [Changes In and Disagreements With Accountants on Accounting and Financial [removed: Disclosure](#i6443bec7a7e647908001f0dc8cad9dcc_160)] [added: Disclosure](#ice21da0ba68f43349fe99c1e37b9f2e3_157)] | | | [removed: [108](#i6443bec7a7e647908001f0dc8cad9dcc_160)] [added: [114](#ice21da0ba68f43349fe99c1e37b9f2e3_157)] | | |

| 9A. | | | [Controls and [removed: Procedures](#i6443bec7a7e647908001f0dc8cad9dcc_163)] [added: Procedures](#ice21da0ba68f43349fe99c1e37b9f2e3_160)] | | | [removed: [109](#i6443bec7a7e647908001f0dc8cad9dcc_163)] [added: [114](#ice21da0ba68f43349fe99c1e37b9f2e3_160)] | | |

| 9C. | | | [Disclosure Regarding Foreign Jurisdictions that Prevent [removed: Inspections](#i6443bec7a7e647908001f0dc8cad9dcc_1661)] [added: Inspections](#ice21da0ba68f43349fe99c1e37b9f2e3_166)] | | | [removed: [110](#i6443bec7a7e647908001f0dc8cad9dcc_1661)] [added: [114](#ice21da0ba68f43349fe99c1e37b9f2e3_166)] | | |

| 10 | | | [Directors, Executive Officers and Corporate [removed: Governance](#i6443bec7a7e647908001f0dc8cad9dcc_175)] [added: Governance](#ice21da0ba68f43349fe99c1e37b9f2e3_175)] | | | [removed: [112](#i6443bec7a7e647908001f0dc8cad9dcc_175)] [added: [116](#ice21da0ba68f43349fe99c1e37b9f2e3_175)] | | |

| 11 | | | [Executive [removed: Compensation](#i6443bec7a7e647908001f0dc8cad9dcc_178)] [added: Compensation](#ice21da0ba68f43349fe99c1e37b9f2e3_178)] | | | [removed: [112](#i6443bec7a7e647908001f0dc8cad9dcc_178)] [added: [116](#ice21da0ba68f43349fe99c1e37b9f2e3_178)] | | |

| 12 | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i6443bec7a7e647908001f0dc8cad9dcc_181)] [added: Matters](#ice21da0ba68f43349fe99c1e37b9f2e3_181)] | | | [removed: [112](#i6443bec7a7e647908001f0dc8cad9dcc_181)] [added: [116](#ice21da0ba68f43349fe99c1e37b9f2e3_181)] | | |

| 13 | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i6443bec7a7e647908001f0dc8cad9dcc_184)] [added: Independence](#ice21da0ba68f43349fe99c1e37b9f2e3_184)] | | | [removed: [112](#i6443bec7a7e647908001f0dc8cad9dcc_184)] [added: [116](#ice21da0ba68f43349fe99c1e37b9f2e3_184)] | | |

| 14 | | | [Principal Accounting Fees and [removed: Services](#i6443bec7a7e647908001f0dc8cad9dcc_187)] [added: Services](#ice21da0ba68f43349fe99c1e37b9f2e3_187)] | | | [removed: [112](#i6443bec7a7e647908001f0dc8cad9dcc_187)] [added: [116](#ice21da0ba68f43349fe99c1e37b9f2e3_187)] | | |

| 15 | | | [Exhibits, Financial Statement [removed: Schedules](#i6443bec7a7e647908001f0dc8cad9dcc_193)] [added: Schedules](#ice21da0ba68f43349fe99c1e37b9f2e3_193)] | | | [removed: [113](#i6443bec7a7e647908001f0dc8cad9dcc_193)] [added: [117](#ice21da0ba68f43349fe99c1e37b9f2e3_193)] | | |

| 16 | | | [Form 10-K [removed: Summary](#i6443bec7a7e647908001f0dc8cad9dcc_196)] [added: Summary](#ice21da0ba68f43349fe99c1e37b9f2e3_196)] | | | [removed: [117](#i6443bec7a7e647908001f0dc8cad9dcc_199)] [added: [121](#ice21da0ba68f43349fe99c1e37b9f2e3_199)] | | |

Additionally, many of these risks and uncertainties are, and may continue to be, amplified by [added: impacts from changes in international conditions, including as a result of] the [removed: ongoing] [added: war between Russia and Ukraine,] coronavirus (“COVID-19”) [removed: pandemic.][added: pandemic and macroeconomic conditions, including inflation.]

Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in or implied by our forward-looking statements include, among others, the following: [added: the impact of] overall industry and [added: general] economic conditions, including industrial, governmental, and public and private sector [removed: spending] [added: spending, inflation, interest rates] and [added: related monetary policy by governments in response to inflation, and] the strength of the residential and commercial real estate [removed: markets; geopolitical,] [added: markets, on economic activity and our operations; geopolitical events, including the war between Russia and Ukraine, and] regulatory, economic and other risks associated with our [added: global] sales and operations, including with respect to domestic content requirements applicable to projects with governmental funding; continued uncertainty around the ongoing [removed: COVID-19 pandemic’s magnitude, duration and] impacts [added: of the COVID-19 pandemic] on [added: the macroeconomy and] our business, operations, growth, and financial condition; actual or potential other epidemics, pandemics or global health crises; availability, shortage or delays in receiving [removed: electronics,] [added: electronic components (in particular, semiconductors),] parts and raw materials from our supply chain; manufacturing and operating cost increases due to [added: macroeconomic conditions, including] inflation, [added: energy supply, supply chain shortages, logistics challenges, tight labor markets,] prevailing price changes, tariffs and other factors; demand for our products, disruption, competition or pricing pressures in the markets we serve; cybersecurity incidents or other disruptions of information technology systems on which we rely, or involving our products; disruptions in operations at our facilities or that of third parties upon which we rely; ability to retain and attract senior management and other diverse and key talent, as well as [removed: increasing] competition for overall talent and labor; difficulty predicting our financial results; defects, security, warranty and liability claims, and recalls with respect to products; availability, regulation or interference with radio spectrum used by certain of our products; uncertainty related to restructuring and realignment actions and related [removed: charges] [added: costs] and savings; our ability to continue strategic investments for growth; our ability to successfully identify, execute and integrate acquisitions; volatility in served markets or impacts on business and operations due to weather conditions, including the effects of climate change; fluctuations in foreign currency exchange rates; our ability to borrow or refinance our existing indebtedness, and uncertainty around the availability of liquidity sufficient to meet our needs; risk of future impairments to goodwill and other intangible assets; failure to comply with, or changes in, laws or regulations, including those pertaining to anti-corruption, data privacy and security, export and import, [added: our products,] competition, and the environment and climate change; changes in our effective tax rates or tax expenses; legal, governmental or regulatory claims, investigations or proceedings and associated contingent liabilities; [added: risks related to our proposed acquisition of Evoqua Water Technologies ("Evoqua"), including related to realization of expected benefits] and [added: synergies, our ability to complete the transaction and need to incur additional transaction costs and expenses, impacts to our share price and dilution of shareholders’ ownership, and incurrence of additional costs and expenses to integrate the combined companies; and] other factors set forth under "Item 1A.

300 Water Street SE, Washington, DC 20003

(202) 869-9150

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

| 1 | | | [Business](#ice21da0ba68f43349fe99c1e37b9f2e3_13) | | | [5](#ice21da0ba68f43349fe99c1e37b9f2e3_13) | | |

| 2 | | | [Properties](#ice21da0ba68f43349fe99c1e37b9f2e3_22) | | | [31](#ice21da0ba68f43349fe99c1e37b9f2e3_22) | | |

| 6 | | | [Reserved](#ice21da0ba68f43349fe99c1e37b9f2e3_43) | | | [37](#ice21da0ba68f43349fe99c1e37b9f2e3_43) | | |

| 9B. | | | [Other Information](#ice21da0ba68f43349fe99c1e37b9f2e3_163) | | | [114](#ice21da0ba68f43349fe99c1e37b9f2e3_163) | | |

| | | | | | | | | |

| | | | | | | | | |

| | | | [Signatures](#ice21da0ba68f43349fe99c1e37b9f2e3_199) | | | [121](#ice21da0ba68f43349fe99c1e37b9f2e3_199) | | |

Additionally, risks and uncertainties relating to our plans to acquire Evoqua could cause our actual results to differ, perhaps materially, from those indicated by these forward-looking statements, including: the risk that the conditions to the closing of the transaction are not satisfied, including the risk that required approvals of the transaction from the shareholders of Xylem or stockholders of Evoqua or from regulators are not obtained; litigation relating to the transaction; uncertainties as to the timing of the consummation of the transaction and the ability of each party to

consummate the transaction; risks that the proposed transaction disrupts the current plans or operations of Xylem or Evoqua; the ability of Xylem and Evoqua to retain and hire key personnel; competitive responses to the proposed transaction; unexpected costs, charges or expenses resulting from the transaction; potential adverse reactions or changes to relationships with customers, suppliers, distributors and other business partners resulting from the announcement or completion of the transaction; the combined company’s ability to achieve the synergies expected from the transaction, as well as delays, challenges and expenses associated with integrating the combined company’s existing businesses.

1 International Drive, Rye Brook, NY 10573

(914) 323-5700

| 2.250% Senior Notes due 2023 | | | XYL23 | | | New York Stock Exchange | | |

| 1 | | | [Business](#i6443bec7a7e647908001f0dc8cad9dcc_13) | | | [3](#i6443bec7a7e647908001f0dc8cad9dcc_13) | | |

| 2 | | | [Properties](#i6443bec7a7e647908001f0dc8cad9dcc_22) | | | [28](#i6443bec7a7e647908001f0dc8cad9dcc_22) | | |

| 6 | | | [Reserved](#i6443bec7a7e647908001f0dc8cad9dcc_43) | | | [33](#i6443bec7a7e647908001f0dc8cad9dcc_43) | | |

| 9B. | | | [Other Information](#i6443bec7a7e647908001f0dc8cad9dcc_166) | | | [109](#i6443bec7a7e647908001f0dc8cad9dcc_166) | | |

| | | | [Signatures](#i6443bec7a7e647908001f0dc8cad9dcc_199) | | | [117](#i6443bec7a7e647908001f0dc8cad9dcc_199) | | |

We have approximately [removed: 345] [added: 370] locations in more than 50 countries.

| Vadodara | | | | | | India | | | | | | Manufacturing and Research & Development | | | | | | [removed: 254,000] [added: 366,000] | | | | | | Leased | | |

| [removed: Rye Brook] [added: Washington] | | | | | | [removed: NY] [added: DC] | | | | | | Administration | | | | | | [removed: 67,000] [added: 18,000] | | | | | | Leased | | |

| Schaffhausen | | | | | | Switzerland | | | | | | Administration | | | | | | 26,000 | | | | | | Leased | | |

| Quenington | | | | | | United Kingdom | | | | | | Manufacturing | | | | | | 86,000 | | | | | | Leased | | |

| Yellow Springs | | | | | | OH | | | | | | Administration and Manufacturing | | | | | | 112,000 | | | | | | Owned | | |

The following information is provided regarding the executive officers of Xylem as of February 7, [removed: 2022:][added: 2023:]

| Patrick K. Decker | | | | | | [removed: 57] [added: 58] | | | | | | President and Chief Executive Officer (2014) | | | | | | | | |

| Sandra E. Rowland | | | | | | [removed: 50] [added: 51] | | | | | | Senior VP and Chief Financial Officer (2020) | | | | | | • Executive Vice President and Chief Financial Officer, Harman International Industries Inc. (2015) | | |

| Dorothy Capers | | | | | | [removed: 60] [added: 61] | | | | | | Senior VP, General Counsel (2022) | | | | | | • Executive Vice President, Global General Counsel and Corporate Secretary, National Express Group (2015) | | |

| Franz Cerwinka | | | | | | [removed: 52] [added: 53] | | | | | | Senior VP and President, Emerging Markets [removed: (2020)] [added: and Applied Water Systems (2023)] | | | | | | • [removed: Chief] [added: Senior VP and President, Emerging Markets (2020) •Chief] Executive Officer, Johnson Controls-Hitachi Air Conditioning (2015) | | |

| Geri McShane | | | | | | [removed: 48] [added: 49] | | | | | | VP, Controller and Chief Accounting Officer (2019) | | | | | | • Controller, Accounting and Reporting (2016) | | |

| Matthew Pine | | | | | | [removed: 50] [added: 51] | | | | | | [added: Chief Operating Officer (2023) | | | | | | •] Senior VP and President, [added: Americas,] Applied Water Systems and [added: Measurement & Control Systems (2022) • Senior VP and President,] Americas [removed: Commercial Team] [added: and Applied Water Systems] (2020) [removed: | | | | | |] • President, Carrier Residential, United Technologies [removed: Corporation] [added: Corporations] (2018) [removed: •VP] [added: • VP] and General Manager, Carrier Residential, United Technologies [removed: Corporation] [added: Corporations] (2017) | | |

| Claudia S. Toussaint | | | | | | [removed: 58] [added: 59] | | | | | | Senior VP, Chief [removed: Human Resources] [added: People] and Sustainability Officer (2021) | | | | | | • Senior VP, General Counsel [removed: -] [added: and Corporate Secretary] (2014) | | |

| Hayati Yarkadas | | | | | | [removed: 53] [added: 54] | | | | | | Senior VP and President, [added: Europe,] Water Infrastructure and [removed: Europe Commercial Team] [added: Global Services] (2020) | | | | | | • Senior Vice President and President, Performance Materials, Trinseo S.A. (2015) | | |

The following information is provided regarding the Board of Directors of Xylem as of February [removed: 3, 2022:][added: 7, 2023:]

| Michael McGann | | | | | | 52 | | | | | | Senior VP and President, Americas and Measurement & Control Solutions (2023) | | | | | | • VP, North America Utilities Commercial Team (2022) \- • VP, Sensus Americas, Global Engineering and Assessment Services (2017) \- • VP, Quality, Sensus USA Inc. (2013) | | |

| | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | |

| Uday Yadav | | | | | | Chief Executive Officer, TK Elevator | | |

| David Flinton | | | | | | 51 | | | | | | Senior VP and Chief Innovation, Technology & Product Management Officer (2019) | | | | | | • Senior VP and President, Dewatering (2015) | | |

| Colin R. Sabol | | | | | | 54 | | | | | | Senior VP and President, Measurement & Control Solutions (2017) | | | | | | | | |

| | | | | | | | | |

| Jorge M. Gomez | | | | | | Executive Vice President, Chief Financial Officer, Dentsply Sirona, Inc. | | |

| Surya N. Mohapatra, Ph.D. | | | | | | Former Chairman, President and Chief Executive Officer, Quest Diagnostics Incorporated | | |

| Uday Yadav | | | | | | President and Chief Operating Officer, Electrical Sector, Eaton Corporation PLC | | |

As of January 31, [removed: 2022,] [added: 2023,] there were [removed: 8,875] [added: 8,359] holders of record of our common stock.

In the first quarter of [removed: 2022,] [added: 2023,] we declared a dividend of [removed: $0.30] [added: $0.33] per share to be paid on March [removed: 17, 2022] [added: 22, 2023] for shareholders of record on February [removed: 17, 2022.][added: 22, 2023.]

There were no unregistered offerings of our common stock during [removed: 2021.][added: 2022.]

*Fourth Quarter [removed: 2021] [added: 2022] Share Repurchase Activity*

The following table summarizes our purchases of our common stock for the quarter ended December 31, [removed: 2021:][added: 2022:]

There were no shares repurchased under this program during the three months ended December 31, [removed: 2021.][added: 2022.]

There are up to [removed: $228] [added: $182] million in shares that may still be purchased under this plan as of December 31, [removed: 2021.][added: 2022.]

This graph covers the period from December 31, [removed: 2016] [added: 2017] through December 31, [removed: 2021] [added: 2022] and assumes that $100 was invested on December 31, [removed: 2016] [added: 2017] in our common stock, the S&P 500 and the S&P 500 Industrials with the reinvestment of any dividends.

[removed: ][added: ]

| December 31, [removed: 2016] [added: 2017] | | | 100 | | | | | | 100 | | | | | | 100 | | |

| December 31, 2018 | | | [removed: 138] [added: 99] | | | | | | [removed: 116] [added: 96] | | | | | | [removed: 105] [added: 87] | | |

| 10/1/22 - 10/31/22 | | | | | | — | | | | | | — | | | | | | — | | | | | | $182 | | |

| 11/1/22 - 11/30/22 | | | | | | — | | | | | | — | | | | | | — | | | | | | $182 | | |

| 12/1/22 - 12/31/22 | | | | | | — | | | | | | — | | | | | | — | | | | | | $182 | | |

| December 31, 2019 | | | 118 | | | | | | 126 | | | | | | 112 | | |

| December 31, 2020 | | | 155 | | | | | | 149 | | | | | | 124 | | |

| December 31, 2021 | | | 184 | | | | | | 191 | | | | | | 151 | | |

| December 31, 2022 | | | 172 | | | | | | 157 | | | | | | 142 | | |

| 10/1/21 - 10/31/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | $228 | | |

| 11/1/21 - 11/30/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | $228 | | |

| 12/1/21 - 12/31/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | $228 | | |

| December 31, 2017 | | | 140 | | | | | | 122 | | | | | | 121 | | |

| December 31, 2019 | | | 165 | | | | | | 153 | | | | | | 136 | | |

| December 31, 2020 | | | 216 | | | | | | 181 | | | | | | 150 | | |

| December 31, 2021 | | | 257 | | | | | | 233 | | | | | | 182 | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#i6443bec7a7e647908001f0dc8cad9dcc_64)] [added: Firm](#ice21da0ba68f43349fe99c1e37b9f2e3_64)] (PCAOB ID No. 34) | | | [removed: [57](#i6443bec7a7e647908001f0dc8cad9dcc_64)] [added: [61](#ice21da0ba68f43349fe99c1e37b9f2e3_64)] | | |

| [Consolidated Income Statements for the Years Ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019](#i6443bec7a7e647908001f0dc8cad9dcc_67)] [added: 2020](#ice21da0ba68f43349fe99c1e37b9f2e3_67)] | | | [removed: [59](#i6443bec7a7e647908001f0dc8cad9dcc_67)] [added: [63](#ice21da0ba68f43349fe99c1e37b9f2e3_67)] | | |

| [Consolidated Statements of Comprehensive Income for the Years Ended December 31, [removed: 2021, 2020 and 2019](#i6443bec7a7e647908001f0dc8cad9dcc_70)] [added: 202](#ice21da0ba68f43349fe99c1e37b9f2e3_70)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_70)[, 202](#ice21da0ba68f43349fe99c1e37b9f2e3_70)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_70) [and 20](#ice21da0ba68f43349fe99c1e37b9f2e3_70)[20](#ice21da0ba68f43349fe99c1e37b9f2e3_70)] | | | [removed: [60](#i6443bec7a7e647908001f0dc8cad9dcc_70)] [added: [64](#ice21da0ba68f43349fe99c1e37b9f2e3_70)] | | |

| [Consolidated Balance Sheets as of December 31, [removed: 2021 and 2020](#i6443bec7a7e647908001f0dc8cad9dcc_73)] [added: 202](#ice21da0ba68f43349fe99c1e37b9f2e3_73)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_73) [and 202](#ice21da0ba68f43349fe99c1e37b9f2e3_73)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_73)] | | | [removed: [61](#i6443bec7a7e647908001f0dc8cad9dcc_73)] [added: [65](#ice21da0ba68f43349fe99c1e37b9f2e3_73)] | | |

| [Consolidated Statements of Cash Flows for the Years Ended December 31, [removed: 2021, 2020 and 2019](#i6443bec7a7e647908001f0dc8cad9dcc_76)] [added: 202](#ice21da0ba68f43349fe99c1e37b9f2e3_76)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_76)[, 202](#ice21da0ba68f43349fe99c1e37b9f2e3_76)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_76) [and 20](#ice21da0ba68f43349fe99c1e37b9f2e3_76)[20](#ice21da0ba68f43349fe99c1e37b9f2e3_76)] | | | [removed: [62](#i6443bec7a7e647908001f0dc8cad9dcc_76)] [added: [66](#ice21da0ba68f43349fe99c1e37b9f2e3_76)] | | |

| [Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, [removed: 2021, 2020 and 2019](#i6443bec7a7e647908001f0dc8cad9dcc_79)] [added: 202](#ice21da0ba68f43349fe99c1e37b9f2e3_79)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_79)[, 202](#ice21da0ba68f43349fe99c1e37b9f2e3_79)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_79) [and 20](#ice21da0ba68f43349fe99c1e37b9f2e3_79)[20](#ice21da0ba68f43349fe99c1e37b9f2e3_79)] | | | [removed: [63](#i6443bec7a7e647908001f0dc8cad9dcc_79)] [added: [67](#ice21da0ba68f43349fe99c1e37b9f2e3_79)] | | |

| [Note 1 Summary of Significant Accounting [removed: Policies](#i6443bec7a7e647908001f0dc8cad9dcc_85)] [added: Policies](#ice21da0ba68f43349fe99c1e37b9f2e3_85)] | | | [removed: [64](#i6443bec7a7e647908001f0dc8cad9dcc_85)] [added: [68](#ice21da0ba68f43349fe99c1e37b9f2e3_85)] | | |

| [Note 2 Recently Issued Accounting [removed: Pronouncements](#i6443bec7a7e647908001f0dc8cad9dcc_88)] [added: Pronouncements](#ice21da0ba68f43349fe99c1e37b9f2e3_88)] | | | [removed: [71](#i6443bec7a7e647908001f0dc8cad9dcc_88)] [added: [75](#ice21da0ba68f43349fe99c1e37b9f2e3_88)] | | |

| [removed: [Note 4 Revenue](#i6443bec7a7e647908001f0dc8cad9dcc_94)] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_94) [3](#ice21da0ba68f43349fe99c1e37b9f2e3_94) [Revenue](#ice21da0ba68f43349fe99c1e37b9f2e3_94)] | | | [removed: [72](#i6443bec7a7e647908001f0dc8cad9dcc_94)] [added: [76](#ice21da0ba68f43349fe99c1e37b9f2e3_94)] | | |

| [removed: [Note 5 Restructuring] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_97) [4](#ice21da0ba68f43349fe99c1e37b9f2e3_97) [Restructuring] and Asset Impairment [removed: Charges](#i6443bec7a7e647908001f0dc8cad9dcc_97)] [added: Charges](#ice21da0ba68f43349fe99c1e37b9f2e3_97)] | | | [removed: [74](#i6443bec7a7e647908001f0dc8cad9dcc_97)] [added: [78](#ice21da0ba68f43349fe99c1e37b9f2e3_97)] | | |

| [removed: [Note 6 Other] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_100) [5](#ice21da0ba68f43349fe99c1e37b9f2e3_100) [Other] Non-Operating Income, [removed: Net](#i6443bec7a7e647908001f0dc8cad9dcc_100)] [added: Net](#ice21da0ba68f43349fe99c1e37b9f2e3_100)] | | | [removed: [77](#i6443bec7a7e647908001f0dc8cad9dcc_100)] [added: [81](#ice21da0ba68f43349fe99c1e37b9f2e3_100)] | | |

| [removed: [Note 7 Income Taxes](#i6443bec7a7e647908001f0dc8cad9dcc_103)] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_103) [6](#ice21da0ba68f43349fe99c1e37b9f2e3_103) [Income Taxes](#ice21da0ba68f43349fe99c1e37b9f2e3_103)] | | | [removed: [77](#i6443bec7a7e647908001f0dc8cad9dcc_103)] [added: [81](#ice21da0ba68f43349fe99c1e37b9f2e3_103)] | | |

| [removed: [Note 8 Earnings] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_106) [7](#ice21da0ba68f43349fe99c1e37b9f2e3_106) [Earnings] Per [removed: Share](#i6443bec7a7e647908001f0dc8cad9dcc_106)] [added: Share](#ice21da0ba68f43349fe99c1e37b9f2e3_106)] | | | [removed: [82](#i6443bec7a7e647908001f0dc8cad9dcc_106)] [added: [86](#ice21da0ba68f43349fe99c1e37b9f2e3_106)] | | |

| [removed: [Note 9 Inventories](#i6443bec7a7e647908001f0dc8cad9dcc_109)] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_109) [8](#ice21da0ba68f43349fe99c1e37b9f2e3_109) [Inventories](#ice21da0ba68f43349fe99c1e37b9f2e3_109)] | | | [removed: [82](#i6443bec7a7e647908001f0dc8cad9dcc_109)] [added: [86](#ice21da0ba68f43349fe99c1e37b9f2e3_109)] | | |

| [removed: [Note 10 Property,] [added: [Note](#ice21da0ba68f43349fe99c1e37b9f2e3_112) [9](#ice21da0ba68f43349fe99c1e37b9f2e3_112) [Property,] Plant and [removed: Equipment](#i6443bec7a7e647908001f0dc8cad9dcc_112)] [added: Equipment](#ice21da0ba68f43349fe99c1e37b9f2e3_112)] | | | [removed: [83](#i6443bec7a7e647908001f0dc8cad9dcc_112)] [added: [87](#ice21da0ba68f43349fe99c1e37b9f2e3_112)] | | |

| [Note [removed: 11 Leases](#i6443bec7a7e647908001f0dc8cad9dcc_115)] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_115)[0](#ice21da0ba68f43349fe99c1e37b9f2e3_115) [Leases](#ice21da0ba68f43349fe99c1e37b9f2e3_115)] | | | [removed: [83](#i6443bec7a7e647908001f0dc8cad9dcc_115)] [added: [87](#ice21da0ba68f43349fe99c1e37b9f2e3_115)] | | |

| [Note [removed: 12 Goodwill] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_121)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_121) [Goodwill] and Other Intangible [removed: Assets](#i6443bec7a7e647908001f0dc8cad9dcc_121)] [added: Assets](#ice21da0ba68f43349fe99c1e37b9f2e3_121)] | | | [removed: [85](#i6443bec7a7e647908001f0dc8cad9dcc_121)] [added: [89](#ice21da0ba68f43349fe99c1e37b9f2e3_121)] | | |

| [Note [removed: 13 Derivative] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_124)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_124) [Derivative] Financial [removed: Instruments](#i6443bec7a7e647908001f0dc8cad9dcc_124)] [added: Instruments](#ice21da0ba68f43349fe99c1e37b9f2e3_124)] | | | [removed: [87](#i6443bec7a7e647908001f0dc8cad9dcc_124)] [added: [90](#ice21da0ba68f43349fe99c1e37b9f2e3_124)] | | |

| [Note [removed: 14 Accrued] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_127)[3](#ice21da0ba68f43349fe99c1e37b9f2e3_127) [Accrued] and Other Current [removed: Liabilities](#i6443bec7a7e647908001f0dc8cad9dcc_127)] [added: Liabilities](#ice21da0ba68f43349fe99c1e37b9f2e3_127)] | | | [removed: [89](#i6443bec7a7e647908001f0dc8cad9dcc_127)] [added: [93](#ice21da0ba68f43349fe99c1e37b9f2e3_127)] | | |

| [Note [removed: 15 Credit] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_130)[4](#ice21da0ba68f43349fe99c1e37b9f2e3_130) [Credit] Facilities and [removed: Debt](#i6443bec7a7e647908001f0dc8cad9dcc_130)] [added: Debt](#ice21da0ba68f43349fe99c1e37b9f2e3_130)] | | | [removed: [89](#i6443bec7a7e647908001f0dc8cad9dcc_130)] [added: [93](#ice21da0ba68f43349fe99c1e37b9f2e3_130)] | | |

| [Note [removed: 16 Post-retirement] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_133)[5](#ice21da0ba68f43349fe99c1e37b9f2e3_133) [Post-retirement] Benefit [removed: Plans](#i6443bec7a7e647908001f0dc8cad9dcc_133)] [added: Plans](#ice21da0ba68f43349fe99c1e37b9f2e3_133)] | | | [removed: [91](#i6443bec7a7e647908001f0dc8cad9dcc_133)] [added: [95](#ice21da0ba68f43349fe99c1e37b9f2e3_133)] | | |

| [Note [removed: 17 Share-Based] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_136)[6](#ice21da0ba68f43349fe99c1e37b9f2e3_136) [Share-Based] Compensation [removed: Plans](#i6443bec7a7e647908001f0dc8cad9dcc_136)] [added: Plans](#ice21da0ba68f43349fe99c1e37b9f2e3_136)] | | | [removed: [98](#i6443bec7a7e647908001f0dc8cad9dcc_136)] [added: [102](#ice21da0ba68f43349fe99c1e37b9f2e3_136)] | | |

| [Note [removed: 18 Capital Stock](#i6443bec7a7e647908001f0dc8cad9dcc_139)] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_139)[7](#ice21da0ba68f43349fe99c1e37b9f2e3_139) [Capital Stock](#ice21da0ba68f43349fe99c1e37b9f2e3_139)] | | | [removed: [101](#i6443bec7a7e647908001f0dc8cad9dcc_139)] [added: [105](#ice21da0ba68f43349fe99c1e37b9f2e3_139)] | | |

| [Note [removed: 19 Accumulated] [added: 1](#ice21da0ba68f43349fe99c1e37b9f2e3_142)[8](#ice21da0ba68f43349fe99c1e37b9f2e3_142) [Accumulated] Other Comprehensive Income [removed: (Loss)](#i6443bec7a7e647908001f0dc8cad9dcc_142)] [added: (Loss)](#ice21da0ba68f43349fe99c1e37b9f2e3_142)] | | | [removed: [102](#i6443bec7a7e647908001f0dc8cad9dcc_142)] [added: [107](#ice21da0ba68f43349fe99c1e37b9f2e3_142)] | | |

| [removed: [Note 20] Commitment and [removed: Contingencies](#i6443bec7a7e647908001f0dc8cad9dcc_145)] [added: Contingencies (Note 19)] | | | [removed: [103](#i6443bec7a7e647908001f0dc8cad9dcc_145)] | | | [added: | | | | | |]

| [Note [removed: 21 Related] [added: 2](#ice21da0ba68f43349fe99c1e37b9f2e3_148)[0](#ice21da0ba68f43349fe99c1e37b9f2e3_148) [Related] Party [removed: Transactions](#i6443bec7a7e647908001f0dc8cad9dcc_148)] [added: Transactions](#ice21da0ba68f43349fe99c1e37b9f2e3_148)] | | | [removed: [104](#i6443bec7a7e647908001f0dc8cad9dcc_148)] [added: [109](#ice21da0ba68f43349fe99c1e37b9f2e3_148)] | | |

| [Note [removed: 22 Segment] [added: 2](#ice21da0ba68f43349fe99c1e37b9f2e3_151)[1](#ice21da0ba68f43349fe99c1e37b9f2e3_151) [Segment] and Geographic [removed: Data](#i6443bec7a7e647908001f0dc8cad9dcc_151)] [added: Data](#ice21da0ba68f43349fe99c1e37b9f2e3_151)] | | | [removed: [105](#i6443bec7a7e647908001f0dc8cad9dcc_151)] [added: [110](#ice21da0ba68f43349fe99c1e37b9f2e3_151)] | | |

| [Note [removed: 23 Valuation] [added: 2](#ice21da0ba68f43349fe99c1e37b9f2e3_154)[2](#ice21da0ba68f43349fe99c1e37b9f2e3_154) [Valuation] and Qualifying [removed: Accounts](#i6443bec7a7e647908001f0dc8cad9dcc_154)] [added: Accounts](#ice21da0ba68f43349fe99c1e37b9f2e3_154)] | | | [removed: [108](#i6443bec7a7e647908001f0dc8cad9dcc_154)] [added: [113](#ice21da0ba68f43349fe99c1e37b9f2e3_154)] | | |

We have audited the accompanying consolidated balance sheets of Xylem Inc. and subsidiaries (the "Company") as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) [removed: ("PCAOB"),] [added: (PCAOB),] the Company's internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in *Internal Control — Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 25, 2022,] [added: 24, 2023,] expressed an unqualified opinion on the Company's internal control over financial reporting.

Goodwill - [removed: Advanced Infrastructure Analytics] [added: M&CS] Reporting [removed: Unit] [added: Units] - Refer to Note [removed: 12] [added: 11] to the financial statements

The goodwill balance was [removed: $2.8] [added: $2.7] billion as of December 31, [removed: 2021,] [added: 2022,] of which [removed: $112 million] [added: $1.6 billion] is allocated to the [removed: AIA] [added: M&CS] Reporting [removed: Unit (“AIA”).][added: Units.]

The fair value of [removed: AIA] [added: the M&CS reporting units] exceeded its carrying value as of the [removed: 2021] [added: 2022] measurement date and, therefore, no [removed: further] impairment was recognized.

To determine the fair value of the [removed: AIA] [added: M&CS] reporting [removed: unit,] [added: units,] the Company used the income approach.

Under the income approach, the fair value of the [removed: AIA] [added: M&CS] reporting [removed: unit] [added: units] was based on the discounted value of the estimated cash flows that [added: the reporting unit is expected to generate.]

The discount rate was based on the weighted average cost of capital appropriate for the [removed: AIA] [added: M&CS] reporting [removed: unit.][added: units.]

Given the significant judgments made by management to estimate the fair value of [removed: AIA,] [added: the M&CS reporting units,] performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to the selection of the discount rate and forecasts of future revenue required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

Our audit procedures related to forecasts of future revenue and selection of the discount rate for [removed: AIA] [added: the M&CS reporting units] included the following, among others:

- We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the determination of the fair value of the [removed: AIA] [added: M&CS] reporting [removed: unit,] [added: units,] such as controls related to management’s forecasts of future revenue and the selection of the discount rate.

| [Note 23 Subsequent Events](#ice21da0ba68f43349fe99c1e37b9f2e3_1660) | | | [113](#ice21da0ba68f43349fe99c1e37b9f2e3_1660) | | |

–Historical revenues

| U.K. pension settlement expense | | | 140 | | | | | | — | | | | | | — | | |

| U.K. pension settlement | | | 137 | | | | | | — | | | | | | — | | |

| December 31, | | | 2022 | | | | | | 2021 | | |

| Year Ended December 31, | | | 2022 | | | | | | 2021 | | | | | | 2020 | | |

| Net income | | | $ | 355 | | | | | $ | 427 | | | | | $ | 254 | |

| Goodwill impairment charge | | | — | | | | | | — | | | | | | 58 | | |

| U.K. pension settlement expense | | | 140 | | | | | | — | | | | | | — | | |

| Settlement of currency forward agreement | | | (10) | | | | | | — | | | | | | — | | |

| Net income | | | | | | | | | | | | | | | 355 | | | | | | | | | | | | | | | | | | | | | | | | 355 | | |

| Other comprehensive income, net | | | | | | | | | | | | | | | | | | | | | 145 | | | | | | | | | | | | — | | | | | | 145 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance at December 31, 2022 | | | $ | 2 | | | | | $ | 2,134 | | | | | $ | 2,292 | | | | | $ | (226) | | | | | $ | (708) | | | | | $ | 9 | | | | | $ | 3,503 | |

If circumstances

In September 2022, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2022-04, "*Liabilities-Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations.*" This guidance requires disclosure of the key terms of outstanding supplier finance programs and a rollforward of the related obligations.

The new standard does not affect the recognition, measurement, or financial statement presentation of supplier finance program obligations.

The ASU becomes effective January 1, 2023, except for the rollforward requirement, which becomes effective January 1, 2024.

Early adoption is permitted.

We will reflect the impact of these disclosure updates in our Form 10-Q for the quarterly period ended March 31, 2023.

In October 2021, the FASB issued ASU No. 2021-08, “Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” This guidance requires an acquirer to apply the guidance in ASC 606, Revenue from Contracts with Customers, to recognize and measure contract assets and contract liabilities in a business combination, rather than using fair value.

The ASU is effective for fiscal years beginning after December 15, 2022, with early adoption permitted.

We are currently evaluating the impact of the guidance on our financial condition and results of operations in light of the proposed acquisition of Evoqua.

| Additions, net | | | 115 | | | 137 | | | | | | | | | | | | | | |

| Balance at 12/31/2022 | | | $ | 151 | | $ | 183 | | | | | | | | | | | | | |

From time to time, the Company will incur costs related to restructuring actions in order to optimize our cost base and more strategically position itself.

The charges primarily included the reduction of headcount across all segments.

| (in millions) | | | | | | 2022 | | | | | | 2021 | | |

| Restructuring costs | | | | | | 15 | | | | | | 6 | | |

| Actions Commenced in 2022: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Costs incurred during 2022 | | | | | | 6 | | | | | | 4 | | | | | | 4 | | | | | | — | | | | | | 14 | | |

| Total expected costs | | | | | | $ | 3 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 3 | |

| Costs incurred during 2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Costs incurred during 2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Total expected costs remaining | | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | |

During 2022, we also incurred charges of $1 million within the Measurement & Control Solutions segment, related to actions commenced prior to 2020.

The Water Infrastructure actions commenced in 2021 consist primarily of severance charges.

Refer to Note 11, "Goodwill and Other Intangible Assets," for additional information.

Refer to Note 11, "Goodwill and Other Intangible Assets," for additional information.

| [Note 3 Acquisitions and Divestitures](#i6443bec7a7e647908001f0dc8cad9dcc_91) | | | [71](#i6443bec7a7e647908001f0dc8cad9dcc_91) | | |

The AIA reporting unit recorded goodwill impairment charges in each of the last two years, most recently including a $58 million charge during Q3 2020.

the reporting unit is expected to generate.

Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions.

–Historical revenues.

- We also evaluated the reasonableness of management’s revenue forecasts by comparing the actual growth in sales orders received to management’s forecasted growth in sales and we tested the accuracy and completeness of the underlying sales orders.

February 25, 2022

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Settlement | | | — | | | | | | — | | | | | | 9 | | |

| Acquisitions of businesses and assets, net of cash acquired | | | — | | | | | | — | | | | | | (18) | | |

| Balance at December 31, 2018 | | | $ | 2 | | | | | $ | 1,950 | | | | | $ | 1,639 | | | | | $ | (336) | | | | | $ | (487) | | | | | $ | 14 | | | | | $ | 2,782 | |

| Sale of Business | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (2) | | | | | | (2) | | |

| Distribution to minority shareholders | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (3) | | | | | | (3) | | |

| Acquisition activity | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | |

On October 31, 2011 (the "Distribution Date"), ITT Corporation (“ITT”) completed the Spin-off (the “Spin-off”) of Xylem, formerly ITT’s water equipment and services businesses.

The Spin-off was completed pursuant to the Distribution Agreement, dated as of October 25, 2011 (the “Distribution Agreement”), among ITT; (now ITT LLC; acquired by Delticus HoldCo, L.P., a portfolio company of Warburg Pincus LLC, on July 1, 2021), Exelis Inc., acquired by Harris Corporation, now L3Harris Technologies, Inc., on May 29, 2015, (“Exelis”) and Xylem.

Xylem Inc. was incorporated in Indiana on May 4, 2011 in connection with the Spin-off.

References in the notes to the consolidated financial statements to “ITT” or “former parent” refers to ITT Corporation (now ITT LLC) and its consolidated subsidiaries (other than Xylem Inc.).

These financial institutions are located

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2016-13, "Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments," amending the accounting for the impairment of financial instruments, including trade receivables.

Under previous guidance, credit losses were recognized when the applicable losses had a probable likelihood of occurring and this assessment was based on past events and current conditions.

The amended current guidance eliminates the “probable” threshold and requires an entity to use a broader range of information, including forecast information when estimating expected credit losses.

Generally, this should result in a more timely recognition of credit losses.

This guidance became effective for interim and annual periods beginning after December 15, 2019 with early adoption permitted for interim and annual periods beginning after December 15, 2018.

The requirements of the amended guidance should be applied using a modified retrospective approach except for debt securities, which require a prospective transition approach.

We adopted this guidance as of January 1, 2020.

The adoption of this guidance did not have a material impact on our financial condition and results of operations.

Acquisitions and Divestitures

2021 and 2020 Acquisitions and Divestitures

We had no material acquisition or divestiture activity during the 12 months ended December 31, 2021 and December 31, 2020.

2019 Acquisitions

During the 12 months ended December 31, 2019 we spent approximately $18 million, net of cash received on acquisition activity.

The table below also reflects updates to the aggregation of applications to simplify and focus presentation.

| | | | | | | | | | | | | | | | | | | | | | | | |

*Items in the prior year footnote disclosures for Applied Water and Measurement and Control Solutions were reclassified to conform to the current classification.

The presentation of geographic regions below has been updated to better align to how management currently focuses on revenue and growth platforms by geographic region.

There has been no change to the Company's reportable segments.

| Balance at 1/1/2020 | | | $ | 106 | | $ | 135 | | | | | | | | | | | | | |

| Additions, net | | | 118 | | | 120 | | | | | | | | | | | | | | |

The charges included the reduction of headcount and consolidation of facilities within our Measurement & Control Solutions and Water Infrastructure segments, as well as headcount reductions within our Applied Water segment.

Our management, with the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") of the Company, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the year ended December 31, [removed: 2021] [added: 2022] pursuant to Rule 13a-15(b) and 15d-15(e) of the Securities Exchange Act of 1934 (“the Exchange Act”).

Based upon that evaluation, our CEO and our CFO concluded that our disclosure controls and procedures as of the year ended December 31, [removed: 2021] [added: 2022] were effective, in all material respects, and designed to provide reasonable assurance that the information required to be disclosed by us in the reports we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosures.

The Company's management, including the CEO and CFO, conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, [removed: 2021] [added: 2022] based on the framework established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organization of the Treadway Commission (2013).

Based on our assessment, the Company's management has concluded that our internal control over financial reporting was effective as of December 31, [removed: 2021.][added: 2022.]

The effectiveness of the Company's internal control over financial reporting as of December 31, [removed: 2021] [added: 2022] has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report which appears following Item 9C of this Annual Report on Form 10-K.

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the 1934 Act) during the fiscal quarter ended December 31, [removed: 2021] [added: 2022] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We have audited the internal control over financial reporting of Xylem Inc. and subsidiaries (the [removed: "Company")] [added: “Company”)] as of [added: December 31, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).]

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in [removed: *Internal] [added: Internal] Control — Integrated Framework [removed: (2013)*] [added: (2013)] issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, [removed: 2021,] [added: 2022,] of the Company and our report dated February [removed: 25, 2022,] [added: 24, 2023,] expressed an unqualified opinion on those financial statements.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying [added: Management's Annual Report on Internal Control over Financial Reporting.]

February 24, 2023

December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Management’s Annual Report on Internal Control over Financial Reporting.

February 25, 2022

The information required by this Item is incorporated herein by reference to the information in our Definitive Proxy Statement to be filed with the SEC in connection with our [removed: 2022] [added: 2023] Annual Meeting of Shareholders (the [removed: “2022] [added: “2023] Proxy Statement”) under the captions “Proposal 1 - Election of Directors,” "Board Composition and Refreshment," "Board Committees - Audit Committee," and "Audit Committee Report."

We have also adopted a written Code of Conduct [removed: which] [added: that] is applicable to all of our directors, officers and employees, including the Company’s CEO and CFO and other executive officers identified pursuant to this Item 10.

The information required by this Item is incorporated herein by reference to the information in our [removed: 2022] [added: 2023] Proxy Statement set forth under captions “Compensation Discussion and Analysis," "Director Compensation," "Board Committees - Leadership Development and Compensation Committee" and “Leadership Development and Compensation Committee Report.”

The information required by this Item is incorporated herein by reference to the information in our [removed: 2022] [added: 2023] Proxy Statement set forth under the captions “Stock Ownership - Certain Beneficial Owners," "Stock Ownership - Directors and Named Executive Officers" and "Equity Compensation Plan Information."

The information required by this Item is incorporated herein by reference to the information in our [removed: 2022] [added: 2023] Proxy Statement set forth under the captions "Corporate Governance - Director Independence" and “Corporate Governance Policies and Practices - Related Party Transactions.”

The information required by this Item is incorporated herein by reference to the information in our [removed: 2022] [added: 2023] Proxy Statement set forth under the captions “Proposal 2 - Fees of Audit and Other Services” and "Proposal 2 - Pre-Approval of Audit and Non-Audit Services."

| [3.2](https://www.sec.gov/Archives/edgar/data/1524472/000152447217000027/a8-k32xbyxlaws.htm) | | | | | | [removed: Fourth] [added: Fifth] Amended and Restated By-laws of Xylem Inc. | | | Incorporated by reference to Exhibit [removed: 3.2] [added: 3.1] of Xylem Inc.’s Form 8-K filed on [removed: May] [added: November] 15, [removed: 2017] [added: 2022] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [4.1](https://www.sec.gov/Archives/edgar/data/1524472/000152447220000006/xyl12312019ex410v1.htm)] [added: [10.24](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000008/xyl12312020ex1023.htm)] | | | [added: #] | | | [removed: Description of securities registered under Section 12 of the Exchange Act] [added: Letter Agreement between Xylem Inc. and Claudia S. Toussaint.] | | | Incorporated by reference to Exhibit [removed: 4.10] [added: 10.23] of Xylem Inc.’s Form 10-K Annual Report filed on February [removed: 28, 2020] [added: 26, 2021] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [4.5](http://www.sec.gov/Archives/edgar/data/1524472/000119312516501188/d161514dex43.htm)] [added: [4.5](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] | | | | | | [removed: Second] [added: Third] Supplemental Indenture, dated [removed: March] [added: October] 11, 2016, by and between the Company and Deutsche Bank Trust Company Americas, as trustee. | | | Incorporated by reference to Exhibit [removed: 4.3] [added: 4.1] of Xylem Inc.’s Form 8-K filed on [removed: March] [added: October] 11, 2016 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [4.6](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] [added: [4.6](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] | | | | | | [removed: Third] [added: Fourth] Supplemental Indenture, dated [removed: October 11, 2016,] [added: June 26, 2020,] by and between the Company and Deutsche Bank Trust Company Americas, as trustee. | | | Incorporated by reference to Exhibit 4.1 of Xylem Inc.’s Form 8-K filed on [removed: October 11, 2016] [added: June 26, 2020] (CIK No. 1524472, File No. [removed: 1-35229).] [added: 1-35229] | | | | | |

| [removed: [4.7](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] [added: [4.8](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] | | | | | | [removed: Fourth Supplemental Indenture, dated June 26, 2020, by and between the Company and Deutsche Bank Trust Company Americas, as trustee.] [added: Form of 1.950% Senior Notes due 2028.] | | | Incorporated by reference to Exhibit 4.1 of Xylem Inc.’s Form 8-K filed on June 26, 2020 (CIK [removed: No.] 1524472, File No. [removed: 1-35229] [added: 1-35229)] | | | | | |

| [removed: [4.8](http://www.sec.gov/Archives/edgar/data/1524472/000119312516501188/d161514dex43.htm)] [added: [4.7](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] | | | | | | Form of Xylem Inc. [removed: 2.250%] [added: 3.250%] Senior Notes due [removed: 2023.] [added: 2026.] | | | Incorporated by reference to Exhibit [removed: 4.3] [added: 4.1] of Xylem Inc.’s Form 8-K [removed: dated March] [added: filed on October] 11, 2016 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [4.9](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] [added: [4.10](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] | | | | | | Form of Xylem Inc. [removed: 3.250%] [added: 4.375%] Senior Notes due [removed: 2026.] [added: 2046.] | | | Incorporated by reference to Exhibit 4.1 of Xylem Inc.’s Form 8-K filed on October 11, 2016 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [4.10](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] [added: [4.9](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] | | | | | | Form of [removed: 1.950%] [added: 2.250%] Senior Notes due [removed: 2028.] [added: 2031.] | | | Incorporated by reference to Exhibit 4.1 of Xylem Inc.’s Form 8-K filed on June 26, 2020 (CIK 1524472, File No. 1-35229) | | | | | |

| [removed: [4.11](https://www.sec.gov/Archives/edgar/data/1524472/000119312520180917/d913118dex41.htm)] [added: [10.25](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000008/xyl12312020ex1024.htm)] | | | [added: #] | | | [removed: Form of 2.250% Senior Notes due 2031.] [added: Letter Agreement between Xylem Inc. and Sandra E. Rowland.] | | | Incorporated by reference to Exhibit [removed: 4.1] [added: 10.24] of Xylem Inc.’s Form [removed: 8-K] [added: 10-K Annual Report] filed on [removed: June] [added: February] 26, [removed: 2020] [added: 2021] (CIK [added: No.] 1524472, File No. [removed: 1-35229)] [added: 1-35229).] | | | | | |

| [removed: [4.12](http://www.sec.gov/Archives/edgar/data/1524472/000119312516735781/d271767dex41.htm)] [added: [10.2](http://www.sec.gov/Archives/edgar/data/1524472/000152447213000011/xyl06302013ex101.htm)] | | | [added: #] | | | [removed: Form of] Xylem [removed: Inc. 4.375% Senior Notes due 2046.] [added: Retirement Savings Plan.] | | | Incorporated by reference to Exhibit [removed: 4.1] [added: 10.1] of Xylem Inc.’s Form [removed: 8-K] [added: 10-Q Quarterly Report] filed on [removed: October 11, 2016] [added: July 30, 2013] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.1](http://www.sec.gov/Archives/edgar/data/216228/000095012311093025/y92712exv10w3.htm)] [added: [10.23](http://www.sec.gov/Archives/edgar/data/1524472/000152447214000007/xyl03312014ex101.htm)] | | | [added: #] | | | [removed: Tax Matters Agreement, dated as of October 25, 2011, among ITT Corporation, Exelis Inc. and] [added: Letter Agreement between] Xylem Inc. [added: and Patrick K. Decker.] | | | Incorporated by reference to Exhibit [removed: 10.3] [added: 10.1] of [removed: ITT Corporation’s] [added: Xylem Inc.'s] Form 10-Q Quarterly Report filed on [removed: October 28, 2011] [added: April 29, 2014] (CIK No. [removed: 216228,] [added: 1524472,] File No. [removed: 1-5672).] [added: 1-35229).] | | | | | |

| [removed: [10.2](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex106.htm)] [added: [10.1](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex106.htm)] | | | # | | | Xylem 2011 Omnibus Incentive Plan (Amended [added: and Restated] as of February 24, 2016). | | | Incorporated by reference to Exhibit 10.6 of Xylem Inc.'s Form 10-K Annual Report filed on February 26, 2016 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.3](http://www.sec.gov/Archives/edgar/data/1524472/000152447213000011/xyl06302013ex101.htm)] [added: [10.3](http://www.sec.gov/Archives/edgar/data/1524472/000095012311099774/y93003exv10w11.htm)] | | | # | | | Xylem [added: Supplemental] Retirement Savings Plan. | | | Incorporated by reference to Exhibit [removed: 10.1] [added: 10.11] of Xylem Inc.’s Form 10-Q Quarterly Report filed on [removed: July 30, 2013] [added: November 21, 2011] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.4](http://www.sec.gov/Archives/edgar/data/1524472/000095012311099774/y93003exv10w11.htm)] [added: [10.20](http://www.sec.gov/Archives/edgar/data/1524472/000095012311099774/y93003exv10w13.htm)] | | | # | | | Xylem [removed: Supplemental Retirement Savings Plan.] [added: Deferred Compensation Plan for Non-Employee Directors.] | | | Incorporated by reference to Exhibit [removed: 10.11] [added: 10.13] of Xylem Inc.’s Form 10-Q Quarterly Report filed on November 21, 2011 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.5](http://www.sec.gov/Archives/edgar/data/1524472/000152447217000008/xyl12312016ex1012.htm)] [added: [10.4](http://www.sec.gov/Archives/edgar/data/1524472/000152447217000008/xyl12312016ex1012.htm)] | | | # | | | Xylem Deferred Compensation Plan. | | | Incorporated by reference to Exhibit 10.12 of Xylem Inc.'s Form 10-K Annual Report filed on February 23, 2017 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.6](http://www.sec.gov/Archives/edgar/data/1524472/000152447220000055/xyl09302020ex101.htm)] [added: [10.5](https://www.sec.gov/Archives/edgar/data/1524472/000152447222000034/xyl06302022ex101.htm)] | | | # | | | Xylem Annual Incentive Plan for the Senior Leadership Team [removed: (formally] [added: (formerly] "Annual Incentive Plan for Executive Officers") restated, with administrative changes only, on [removed: August] [added: July] 11, [removed: 2020] [added: 2022] | | | Incorporated by reference to Exhibit 10.1 of Xylem Inc.'s Form 10-Q Quarterly Report filed on [removed: October 29, 2020] [added: August 2, 2022] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.7](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex1015.htm)] [added: [10.6](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex1015.htm)] | | | # | | | Xylem Special Senior Executive Severance Pay [removed: Plan (Amended as of February 24, 2016).] [added: Plan, restated, with administrative changes only, on July 11, 2022] | | | Incorporated by reference to Exhibit 10.15 of Xylem Inc.'s Form [removed: 10-K Annual] [added: 10-Q Quarterly] Report filed on [removed: February 26, 2016] [added: August 2, 2022] (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.8](http://www.sec.gov/Archives/edgar/data/1524472/000152447217000039/xyl06302017ex101.htm)] [added: [10.7](http://www.sec.gov/Archives/edgar/data/1524472/000152447217000039/xyl06302017ex101.htm)] | | | # | | | Xylem Senior Executive Severance Pay Plan (Amended as of May 10, 2017). | | | Incorporated by reference to Exhibit 10.1 of Xylem Inc.'s Form 10-Q Quarterly Report filed on August 1, 2017 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.9](http://www.sec.gov/Archives/edgar/data/1524472/000152447215000006/xyl12312014ex101.htm)] [added: [10.8](http://www.sec.gov/Archives/edgar/data/1524472/000152447215000006/xyl12312014ex101.htm)] | | | # | | | Form of Xylem 2011 Omnibus Incentive Plan Non-Qualified Stock Option Award Agreement (2015). | | | Incorporated by reference to Exhibit 10.1 of Xylem Inc.’s Form 10-K Annual Report filed on February 26, 2015 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.10](http://www.sec.gov/Archives/edgar/data/1524472/000152447213000006/xyl03312013ex101.htm)] [added: [10.9](http://www.sec.gov/Archives/edgar/data/1524472/000152447213000006/xyl03312013ex101.htm)] | | | # | | | Form of Xylem 2011 Omnibus Incentive Plan Non-Qualified Stock Option Award Agreement (2013). | | | Incorporated by reference to Exhibit 10.1 of Xylem Inc.'s Form 10-Q Quarterly Report filed on April 30, 2013 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.11](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex107.htm)] [added: [10.10](http://www.sec.gov/Archives/edgar/data/1524472/000152447216000027/xyl12312015ex107.htm)] | | | # | | | Form of Xylem Non-Qualified Stock Option Award Agreement (Amended as of February 24, 2016). | | | Incorporated by reference to Exhibit 10.7 of Xylem Inc.'s Form 10-K Annual Report filed on February 26, 2016 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.12](http://www.sec.gov/Archives/edgar/data/1524472/000152447218000006/xyl12312017ex1031.htm)] [added: [10.11](http://www.sec.gov/Archives/edgar/data/1524472/000152447218000006/xyl12312017ex1031.htm)] | | | # | | | Form of Xylem Restricted Stock Unit Agreement (Amended as of February 21, 2018). | | | Incorporated by reference to Exhibit 10.31 of Xylem Inc.'s Form 10-K Annual Report filed on February 23, 2018 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.13](http://www.sec.gov/Archives/edgar/data/1524472/000152447218000006/xyl12312017ex1032.htm)] [added: [10.12](http://www.sec.gov/Archives/edgar/data/1524472/000152447218000006/xyl12312017ex1032.htm)] | | | # | | | Form of Xylem Performance Share Unit Agreement (Amended as of February 21, 2018). | | | Incorporated by reference to Exhibit 10.32 of Xylem Inc.'s Form 10-K Annual Report filed on February 23, 2018 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.14](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex103.htm)] [added: [10.13](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex103.htm)] | | | # | | | Form of Xylem 2011 Omnibus Incentive Plan Non-Qualified Stock Option Award Agreement (2021). | | | Incorporated by reference to Exhibit 10.3 of Xylem Inc.’s Form 10-Q Quarterly Report filed on May 4, 2021 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.15](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex104.htm)] [added: [10.14](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex104.htm)] | | | # | | | Form of 2011 Omnibus Incentive Plan Performance Share Unit Agreement (2021). | | | Incorporated by reference to Exhibit 10.4 of Xylem Inc.’s Form 10-Q Quarterly Report filed on May 4, 2021 (CIK No. 1524472, File No. 1-35229). | | | | | |

| [removed: [10.16](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex105.htm)] [added: [10.15](https://www.sec.gov/Archives/edgar/data/1524472/000152447221000012/xyl03312021ex105.htm)] | | | # | | | Form of 2011 Omnibus Incentive Plan Restricted Stock Unit Agreement (2021). | | | Incorporated by reference to Exhibit 10.5 of Xylem Inc.’s Form 10-Q Quarterly Report filed on May 4, 2021 (CIK No. 1524472, File No. 1-35229). | | | | | |