Waste Management, Inc.

Good day, and thank you for standing by. Welcome to the WM Second Quarter Earnings Conference Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I will now hand the conference over to your first speaker today, Ed Egl, Vice President of Investillations. Please go ahead.

In our prepared remarks, each of these members of our leadership team will be available during the Q&A portion of the call. Before we get started, please note that we have filed a form 8K that includes the earnings press release and is available on our website at www.wm.com. The form 8K, the press release, and the schedules for the press release include important information. During the call, you will hear forward-looking statements, which are based on current expectations, projections, or opinions about future periods. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties are discussed in today's press release and in our filings with the SEC, including our most recent Form 10-K and Form 10-Qs. John will discuss our results in the areas of yield and volume, which, unless stated otherwise, are more specifically references to internal revenue growth or IRG from yield or volume. During the call, Jim, John, and David will discuss operating EBITDA, which is income from operations, before depreciation, depletion, amortization, and accretion. Beginning this year, landfill accretion expense was moved from operating expense to depreciation, depletion, amortization, and accretion to enhance comparability and better reflect operating performance. For comparability purposes, 2025 actuals have been updated to reflect this change. Any comparisons unless stated otherwise will be with the prior year period, net income, EPS, income from operations and margin, operating EBITDA and margin, and SG&A expense and margin have been adjusted to enhance comparability by excluding certain items that management believes do not reflect our fundamental business performance or results of operations. These adjusted measures, in addition to free cash flow, are non-GAAP measures. Please refer to the earnings press release and tables, which can be found on the company's website at www.wm.com, for reconciliations to the most comparable GAAP measures and additional information about our use of non-GAAP measures. This call is being recorded and will be available 24 hours a day beginning approximately 1 p.m. Eastern Time today. To hear a replay of the call, access the WM website at www.investors.wm.com. Time-sensitive information provided during today's call, which is occurring on July 29, 2026, may no longer be accurate at the time of a replay. Any redistribution, retransmission, or rebroadcast of this call in any form without the express written consent of WM is prohibited. Now I'll turn the call over to WM CEO, Jim Fish.

Okay, thanks, Ed, and thank you all for joining us. We're pleased to report another quarter of strong earnings growth, margin expansion, and robust cash flow generation. In the second quarter, operating EBITDA grew 5.5% or 9.1%, excluding last year's wildfire cleanup contributions. Operating EBITDA margin expanded by 40 basis points, overcoming a 60 basis point headwind from wildfire volumes and a 40 basis Point Headwind from higher energy surcharges. The strong underlying margin expansion was led by the collection and disposal business, where continued price discipline, cost optimization, and business mix improvements drove better profitability. Importantly, this earnings growth, combined with lower capital spending and working capital benefits, led to a 35% free cash flow growth for the quarter. Taken together, Our higher earnings, margin expansion, and free cash flow results once again demonstrate the strength and consistency of our operating model and our team. Additionally, our second quarter results reinforce the power and value of WM's integrated business model. Our collection and disposal operations serve as a powerful foundation providing the scale, network, customer relationships, and operational discipline that serve the broader enterprise. We continue to expand the value created by that foundation and strengthen the long-term earnings profile of the company through our investments in recycling, renewable energy, and healthcare solutions. For example, our recycling automation projects are driving a sustained 30% improvement in labor costs per ton compared to legacy facilities. And in the second quarter, we processed 12% more recyclables year over year. We also produced an additional 1.6 million mm BTU of renewable natural gas leading to combined recycling and renewable energy operating EBITDA growth of nearly 33% and a 30 basis point uplift to total company margin. Healthcare Solutions delivered a strong quarter expanding operating EBITDA margin by 200 basis points through cross-selling and cost synergy capture which reinforces our confidence in the platform's long-term growth and earnings potential. Stepping back, WM's advantage is how all these businesses work together. Our network allows us to operate more efficiently, deliver better customer outcomes, and invest in attractive growth opportunities from a position of strength as our complementary assets and capabilities reinforce one another and allow us to capture more value across the waste stream and generate attractive returns for shareholders. This integrated approach is supported by disciplined capital allocation. We're directing capital to opportunities where our existing network, customer relationships, and operating capabilities give us a clear advantage, including the $235 million of solid waste tuck-in acquisitions we closed during the quarter. These transactions strengthen our route density, expand our customer base, and enhance the value of our existing disposal network, making them a natural extension of the integrated model we've built. Looking ahead, we continue to see an attractive pipeline of solid waste acquisition opportunities. Given our quick work returning leverage to within our targeted range following the acquisition of Sericycle, we expect to increase core acquisitions in the future. As we close out the second quarter, our results reflect the strength of WM's integrated operating platform and the consistency of our strategy. We continue to execute well in the core business, extend the value of our network through disciplined investments in recycling, renewable energy, and healthcare solutions, and strengthen our market position through targeted acquisitions. Together with our balanced approach to capital allocation, these actions support continued growth in earnings, cash flow, and long-term shareholder value. I want to thank our employees for their dedication and hard work, which make these results possible. And now, I'll turn the call over to John to discuss our operational results and progress against our strategic priorities.