WM Healthcare Solutions is the medical waste and secure document destruction business Waste Management (WM) built around its $7.2 billion Stericycle acquisition in 2024. In the third quarter of 2026, it posted a 33% jump in operating EBITDA. Better pricing, lower overhead and fewer billing headaches drove the gain, according to WM’s earnings release and Waste Dive’s coverage of the earnings call.
What Did WM Report for Q3 2026?
WM’s third-quarter results show higher revenue, higher profit and a softer collection business. The key numbers:
|
Metric |
Q3 2026 |
Q3 2025 |
|
Revenue |
$6.846 billion |
$6.443 billion |
|
Net income |
$820 million |
$603 million |
|
Adjusted operating EBITDA |
$2.121 billion (+5.8%) |
n/a |
|
Adjusted EBITDA margin |
31% |
n/a |
Revenue rose about 6.3% year over year. Net income grew by more than a third. Collection volumes fell, and that remains the weak spot.
How Did WM Healthcare Solutions Perform?
WM Healthcare Solutions grew operating EBITDA by 33% and revenue by 3.7% year over year. Waste Dive reports this is the segment’s first quarterly revenue increase since the Stericycle deal closed.
The result suggests the integration is working. It took a while to get here. The acquisition ran into billing errors, ERP system problems and customer losses. WM has now largely fixed the billing issues, and that cut the manual work staff needed to keep invoices accurate.
Which Targets Did WM Hit This Quarter?
WM met two targets it had set for the segment:
- Core price: It reached 5.5%.
- SG&A expenses: They fell to 15.2% of revenue, a 390-basis-point improvement from last year, CFO David Reed said on the call.
President John Morris credited two changes for the progress. WM now sets prices closer to what each service costs to deliver, and it has automated more of its processes.
When Will Healthcare Solutions Volumes Recover?
Morris expects volumes to recover in 2027. He told analysts that medical waste will likely bounce back more slowly than secure document destruction.
Volume is still the segment’s main pressure point, even with earnings up. WM also says it remains on track to hit its Stericycle cost-saving targets by mid-2027. The company has projected $300 million in synergies by late 2027.
How Did WM’s Sustainability Business Do?
WM’s sustainability segment, which covers recycling and renewable natural gas (RNG), grew EBITDA by 30%. Higher volumes after the completion of infrastructure projects drove the increase.
Collection and disposal volumes across the company fell 0.4%. Two factors explain most of the drop:
- WM keeps walking away from lower-margin residential business.
- It lost some commercial accounts tied to national account brokers.
Who is Taking Over as WM’s CEO?
John Morris will succeed Jim Fish as WM’s CEO in January 2027, when Fish retires. Morris currently serves as president and has led much of the Healthcare Solutions turnaround.
What is WM’s Full-Year 2026 Outlook?
WM expects full-year 2026 revenue near the upper end of its $26.275 billion to $26.475 billion guidance range. It projects adjusted operating EBITDA of $8.15 billion to $8.25 billion.
What Comes Next for WM Healthcare Solutions?
Three things will decide how the segment performs from here:
- WM has to hold on to its pricing gains.
- It has to keep improving operational efficiency.
- It has to deliver the promised acquisition synergies.
The Q3 numbers show real progress. Long-term performance depends on whether revenue and service volumes grow alongside the cost cuts.
