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Xylem closes a record-breaking 2024: Financial insights and trends shaping the industry's future

  • Xylem closes record-breaking 2024: Financial insights and trends shaping the industry's future

Xylem Inc. (NYSE: XYL) has delivered financial results that reaffirm its leadership in the water sector and intelligent water resource management. A year of sustained revenue and profitability growth, with a clear commitment to digitalization and technological innovation. Here are the key takeaways from these results and what to expect in 2025:

1. Sustained growth and operating margin expansion

Xylem's revenue reached $8.6 billion in 2024, a 16% increase from the previous year. In organic terms, growth was 6%, demonstrating the business's strength. The company expanded its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin to 21%, driven by operational efficiency, pricing adjustments, and greater scalability.

2. Higher profitability and financial optimization

Adjusted earnings per share (EPS) grew 13% to $4.27, while net income increased 31% to $3.65 per share. The net margin reached 14.5%, supported by the revaluation of its stake in Idrica and strong operational execution.

3. Strong order backlog and revenue stability

Orders grew by 7% in the fourth quarter, reinforcing revenue forecasts for 2025. The diversification of its portfolio and the demand for water efficiency solutions enhance the company’s financial stability.

4. Digitalization and automation as strategic pillars

Xylem continues to expand its digital offering with advanced real-time monitoring and optimization platforms. The integration of artificial intelligence (AI) and machine learning is improving operational efficiency and reducing costs—key factors in an increasingly regulated and efficiency-driven environment.

5. Dividend increase and shareholder returns

The quarterly dividend will rise by 11% to $0.40 per share, with payment scheduled for March 2025. This underscores Xylem’s confidence in its ability to continue delivering value to shareholders.

6. Positive expectations for 2025

Xylem estimates revenue of up to $8.7 billion in 2025, with organic growth of 3-4%. A margin expansion of up to 120 basis points is expected, solidifying its profitable and sustainable business model.

7. Cash generation for strategic investments

The projected free cash flow margin is 9-10%, allowing Xylem to continue investing in research and development (R&D), acquisitions, and shareholder returns. Financial discipline remains a key pillar of its corporate strategy.

8. Operational strength and market resilience

The company maintains a solid position against macroeconomic challenges, with stable demand across all its divisions. Cost optimization and efficient supply chain management have strengthened its global competitiveness.

9. Innovation in water treatment and control technologies

Xylem continues to invest in advanced filtration, measurement, and water quality control technologies, aligning with increasingly stringent environmental regulations and the growing need for global water security.

10. Regulation and sustainability as growth drivers

Environmental policies and the push to reduce water consumption are accelerating the adoption of solutions like those from Xylem. The digitalization and automation of processes will be key to ensuring global water security.

With these results and trends on the horizon, Xylem positions itself as a key player in the transformation of the water sector, combining sustainable growth with efficient financial management and strategic vision. In 2025, tracking its execution of digital strategies and margin expansion will be crucial.

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