Republic Services, Inc. Q1 FY2026 earnings call

• Acquisition-wise, focus on strengthening markets already in (recycling and waste, environmental solutions) and expanding geographies. - Regarding CPI, details on the percentage of contracts linked to CPI and lag times. - Residential business profitability is improving due to underperforming contracts being addressed and strong pricing in the remainder of the portfolio. - On technology, using AI for bespoke pricing in annual price increases for existing customers, and working on data for routing with AI while prioritizing customer service. - Environmental solutions is improving but not as fast as some parts of recycling and waste, with sales pipeline and start dates for contracted work noted.

Of the spend so far this year for closed and signed-to-close deals, over 90% is in recycling and waste. The balance may rotate a bit throughout the rest of the year, but it's strong in both areas. For environmental solutions, there are opportunities to strengthen existing markets and expand into new ones. Of restricted contracts, just shy of 20% are directly linked to headline CPI, 35% to alternative indexes, and about 45% are fixed or with rate reviews.

• Residential volumes' rate of decrease will improve, though likely still decline next year. - Environmental services has momentum building in the second half of the year, with incremental progress quarter to quarter. - Routing using AI and dynamic pricing with AI will continue to improve over time, with routing benefits expected in the second half of next year and scaling in 2028.

• Impact of CDL regulations on drivers has been de minimis but noted. - For environmental solutions, mix of self-inflicted pricing and market-related softness, with some market factors like ER and vertical market variations posing risks.

Q: Question on CPI, how much of portfolio is indexed with CPI, lag etc., A: Just shy of 20% directly linked to headline CPI, 35% to alternative indexes, balance 45% fixed etc., lag is 12 months on average Q: Question on residential volumes turning positive next year, A: Rate of decrease will improve but likely still declines next year Q: Follow up on residential business profitability, A: Profitability improving due to underperforming contracts and strong pricing in remainder of portfolio Q: Follow up on employee turnover and CDL regulations, A: Impact de minimis, team doing well in retaining colleagues Q: Question on green sheets in ES business, A: ES is improving but not as fast as some parts of recycling and waste, with oil prices affecting some work Q: Question on volumes down in CNT business, A: More of a comp issue due to prior year hurricane cleanup efforts in southeast Q: Question on volume cadence in environmental services, A: Don't report specific volume metric, but momentum building in second half, year-over-year comp tough in second quarter but second half volume picture builds Q: Question on acquisition opportunities in ES vs municipal solid waste, A: Plenty of opportunities in ES, more momentum now in recycling and waste but ES also has strong activity level Q: Question on RISE digital platform, pricing and AI routing, A: Using AI with dozens of variables for bespoke pricing, routing has upfront data work with focus on customer service first then efficiency, benefits in second half of next year scaling in 2028 Q: Question on environmental solutions weakness, self-inflicted vs market, A: Split hard to identify, more self-inflicted in past, sales pipeline and start dates for contracted work noted, mix of market and self-related factors affecting it