The nation’s largest waste haulers delivered strong third-quarter earnings and expanded EBITDA margins despite lower recycled commodity values.
Recycled commodity prices remained under pressure throughout Q3, with basket prices falling into the $120-to-$130 per ton range. Still, haulers anticipate a potential rebound in 2026 as capacity adjustments and improved economic conditions could spur pricing recovery.
Despite pricing falling nearly 35% year-over-year, WM‘s recycling segment operating EBITDA grew by 18%, reported CEO Jim Fish.
Recovery outlook mixed
Approximately 10% of domestic OCC capacity has been taken offline through mill closures, compounding pressure from weak box demand, said Tara Hemmer, WM’s chief sustainability officer.
“Plastics are at all-time lows. But when you look at commodity price trends, typically from peak to trough, roughly 12 to 24 months, we would expect a bit of a bounceback sometime in 2026. We’re not expecting that in Q4 of 2025. We’re expecting commodity prices to remain around that $65 to $68 a ton basket,” she said.
Hemmer also commented about the October closure of Natura PCR, stating that market conditions drove plastic film processing recycling operations to shutter.
“We built this plant and demonstrated that we could produce a high-quality pellet that customers would buy. With virgin prices being at all-time lows and some of the minimum content legislation being a bit delayed, the buyers were just not there for the product that we were producing,” she said.
“We made the decision to temporarily close the operations. We could start it back up, but we’re going to monitor what happens with those market conditions going forward.”
Casella Waste Systems saw average recycled commodity revenue per ton down 29% year-over-year, with softer markets across the board and most commodities selling below five-year averages,” said CFO Brad Helgeson.
“Notwithstanding market pressures, our contract structures share this risk with our customers by adjusting tip fees in down markets. So the net impact of lower commodity prices on our revenue is only about $1 million,” he added.
Phoenix-based Republic Services saw commodity prices fall to $126 per ton from $177 per ton the previous year.
“Recycling processing and commodity sales decreased organic revenue growth by 20 basis points,” said CFO Brian DelGhaccio, and with current prices declining to $120/ton, further headwinds are expected exiting Q3 2025.
“Increased volumes at our polymer centers and reopening a recycling center on the West Coast partially offset the impact of lower recycled commodity prices,” he said.
Strategic expansion continues
M&A activity remained a key driver of haulers’ environmental services expansion strategies during the quarter, reaching about $2 billion in acquisitions going into Q4.
Casella Waste Systems finalized eight acquisitions year-to-date, which are expected to add nearly $105 million in annualized revenue, said John Casella, CEO and chairman.
“Our M&A strategy remains focused on a balanced mix of smaller tuck-in acquisitions and larger opportunities that expand our geographic footprint, such as Mountain State,” he said.
President Ned Coletta said four smaller tuck-in deals, currently under letter of intent, should close in late Q4 or at the beginning of 2026. These total roughly $20 million of annualized revenues.
“With an active pipeline representing approximately $500 million in annualized revenues and a strong balance sheet, we are well-positioned to continue creating long-term shareholder value through disciplined strategic growth,” John Casella said.
John Casella announced in August that he would exit his role as CEO Jan. 1, 2026, with Coletta stepping into the position. Casella will remain on board as executive chairman.
Continuing the trend, WM allocated more than $400 million in solid waste acquisition in the first three quarters of 2025.
“I think we’ve closed about $450 million year-to-date, and we said that number could be as big as $500 million by the end of the year. And it could still be,” said COO John Morris. “We’ve got a handful of transactions that are out there that could close in Q4 or could roll into next year. But I think with regard to ’26, sitting here today, I think probably somewhere in the normal $100 million to $200 million is what we’re looking at now.”
The acquisition pipeline remained strong for Republic Services as well, with CEO John Vander Ark saying the company has invested more than $1 billion to date in 2025, both in the recycling and waste and environmental solutions businesses.
Vander Ark said the company expects a strong finish to the year as well as into 2026, although “the exact balance of when things close end of the year or into the first half of next year, we’ll see.
“Then the pipeline behind those things that would be more likely to close in the second half is still very full. And that’ll be a balance across both recycling and waste and ES. You know, tilted towards recycling and waste, but we’ll look for opportunities on all ends.”
GFL Environmental CEO Patrick Dovigi said the company is on target with its M&A goals, set earlier in the year. With better-than-expected operational performance, the company raised its year-end guidance for the second time in 2025.
“The strength of the base business performance and the anticipated contribution from recent M&A allow us to raise full-year guidance for the second time this year,” Dovigi said.
Based in Ontario, Canada, GFL has deployed nearly $650 million in acquisition activity, with “several incremental deals in process as well as a plan to deploy incremental capital into M&A before year-end,” Dovigi noted.
The company’s M&A pipeline remains robust, with additional transactions expected to close in the first half of 2026. Those deals are anticipated to provide momentum heading into Q1, he said.
Acquisition activity has continued at an “above average pace” for Texas-based Waste Connections, said CEO Ron Middlestadt, adding that about $300 million in annualized revenues were either closed or under definitive agreement to date.
“By early 2026, we’ve had some fantastic M&A wins, including two of the largest private companies in Florida, one of which we closed during Q3 with the other signed and expected to close in Q4,” he said, referring to family-owned, Ocala-based Florida Express Environmental and one other company in the state that is yet to be announced.
