Ecolab Inc.: Q4 FY2025 earnings call

What management said about Q4 FY2025, from the documents filed with the SEC on 27 March 2026: press release. Guidance figures: 3 new, 1 kept. The quarter’s numbers.

Key takeaways

Reported net sales reached $16.1 billion: Reported GAAP net sales for the year ended December 31, 2025 were $16,081.2 million, against $15,741.4 million in 2024. At 2026 fixed rates the subtotal was $16,298.4 million, against $15,998.8 million. Source
Reported operating income declined: Reported GAAP operating income was $2,737.6 million in 2025, against $2,802.4 million in 2024. Source
Global Water sales and profit rose: Global Water net sales were $8,107.7 million at 2026 fixed rates, against $7,903.8 million. Its operating income was $1,357.5 million, against $1,296.9 million. Source
Special charge replaced prior-year gain: Special (gains) and charges were a $150.3 million charge in 2025, against a $188.7 million gain in 2024. Source
About $4.75 billion cash at closing: Ecolab agreed to buy CoolIT from funds managed by KKR, paying approximately $4.75 billion in cash at closing, subject to customary adjustments.
Price at 29x and 24x EBITDA: The price represents 29 times estimated next 12-month adjusted EBITDA and 24 times estimated 2027 adjusted EBITDA for CoolIT.
Combined cooling-as-a-service offering: Management says combining CoolIT with Ecolab's water, chemistry and service capabilities strengthens its Cooling-as-a-Service offering.

“AI is transforming the demands on data centers, and liquid cooling is one of the critical technologies that makes advanced computing possible,”
Christophe Beck, Ecolab chairman and chief executive officer

Guidance

Area	Period	Figure	Against last quarter
Adjusted diluted EPS, first quarter 2026	first quarter 2026	$1.69 to $1.71, up 13% to 14%
Adjusted diluted EPS, full-year 2026 excluding CoolIT	full-year 2026	$8.43 to $8.63, up 12% to 15%	Kept
CoolIT sales	next 12 months	approximately $550 million	New
Organic sales growth from CoolIT	beginning one year after closing	Global Water organic growth rate up by 2%; Ecolab organic growth rate up by 1%	New
Pro forma net debt to adjusted EBITDA	at transaction close, then end of second year after closing	approximately 3x at close, 2x by end of second year after closing	New

What changed from last quarter

New: Ecolab announced a definitive agreement to acquire CoolIT Systems, a liquid cooling company for AI data centers, from funds managed by KKR.
Guidance kept: The full-year 2026 adjusted diluted EPS range, excluding CoolIT, was continued at $8.43 to $8.63.

Full-year 2025 results

Reported net sales reached $16.1 billion: Reported GAAP net sales for the year ended December 31, 2025 were $16,081.2 million, against $15,741.4 million in 2024. At 2026 fixed rates the subtotal was $16,298.4 million, against $15,998.8 million. Source
Reported operating income declined: Reported GAAP operating income was $2,737.6 million in 2025, against $2,802.4 million in 2024. Source
Fixed-rate operating income lower: At 2026 fixed rates, subtotal operating income was $2,786.9 million in 2025, against $2,854.9 million in 2024. Source

Segment sales and operating income

Global Water sales and profit rose: Global Water net sales were $8,107.7 million at 2026 fixed rates, against $7,903.8 million. Its operating income was $1,357.5 million, against $1,296.9 million. Source
Institutional and Specialty sales slightly lower: Global Institutional & Specialty net sales were $6,164.8 million at 2026 fixed rates, against $6,187.3 million. Its operating income rose to $1,398.1 million from $1,244.7 million. Source
Pest Elimination grew sales and profit: Global Pest Elimination net sales were $1,258.8 million, against $1,177.8 million. Its operating income was $244.6 million, against $217.3 million. Source
Life Sciences grew sales and profit: Global Life Sciences net sales were $767.1 million, against $729.9 million. Its operating income was $144.1 million, against $112.4 million. Source
Corporate operating loss widened: The corporate line recorded an operating loss of $357.4 million at 2026 fixed rates, against $16.4 million in 2024. Source

“positions Ecolab as the partner that the world’s largest technology companies rely on to grow responsibly and sustainably.”
Christophe Beck, Ecolab chairman and chief executive officer

Costs and special items

Cost of sales slightly higher: Total cost of sales at 2026 fixed rates was $9,054.7 million in 2025, against $9,040.7 million in 2024. Source
SG&A expenses slightly higher: Total selling, general and administrative expenses at 2026 fixed rates were $4,306.5 million, against $4,291.9 million in 2024. Source
Corporate SG&A nearly flat: Corporate selling, general and administrative expenses were $199.4 million at 2026 fixed rates, against $199.8 million in 2024. Source
Special charge replaced prior-year gain: Special (gains) and charges were a $150.3 million charge in 2025, against a $188.7 million gain in 2024. Source

Fixed currency reporting basis

Currency translation effect on sales: The translation effect bridging fixed-rate sales to reported sales was $(217.2) million in 2025 and $(257.4) million in 2024. Source
Fixed rates reset for 2026: Management set fixed currency rates at the beginning of 2026, replacing the 2025 established rates used in the prior table. Source
Segment transfers treated as immaterial: The Other columns reflect changes between segments, including customer movements and cost allocations, which the company describes as immaterial. Source
Fixed currency measures are non-GAAP: The company uses these non-GAAP measures internally to evaluate performance, including for incentive compensation. Source

CoolIT acquisition terms

About $4.75 billion cash at closing: Ecolab agreed to buy CoolIT from funds managed by KKR, paying approximately $4.75 billion in cash at closing, subject to customary adjustments.
Pure-play data center cooling business: CoolIT designs and manufactures liquid cooling systems for data centers only, including coolant distribution units, cold plates and direct-to-chip technologies.
Price at 29x and 24x EBITDA: The price represents 29 times estimated next 12-month adjusted EBITDA and 24 times estimated 2027 adjusted EBITDA for CoolIT.
Global High-Tech market size doubles: Management says the deal doubles the Global High-Tech market size from $5 billion to $10 billion, a market it describes as growing at double-digit rates.

Financing and returns

Acquisition funded with new debt: Management says the acquisition will be financed with new transaction debt.
Returns expected above cost of capital: Management expects returns from the acquisition to be well above Ecolab's weighted average cost of capital.

Data center and AI customer reach

Relationships with hyperscale and colocation customers: Management says Ecolab's existing data center reach brings deep relationships with the world's major hyperscaler and colocation customers.
Custom designs for AI chip developers: CoolIT adds custom-designed solutions for leading AI chip developers, along with manufacturing and supply chain capacity to support rapid scaling.
Combined cooling-as-a-service offering: Management says combining CoolIT with Ecolab's water, chemistry and service capabilities strengthens its Cooling-as-a-Service offering.
Recurring high-margin cooling business: Management says the deal accelerates a recurring, high-margin data center cooling business, adding CDUs, cold plates, liquid loops and rack manifolds.

Guidance basis and definitions

Adjusted EPS excludes special items: Adjusted diluted EPS excludes special (gains) and charges and discrete tax items, per the company's non-GAAP definition.
EBITDA definition used for leverage: EBITDA and adjusted EBITDA are used in the company's net debt to adjusted EBITDA ratio, and are defined as follows.
Full-year range stated before CoolIT: The full-year 2026 adjusted EPS range is stated excluding any impact from CoolIT.

Coming up, as management said on 27 March 2026

First-quarter 2026 results release: The company said it will release first quarter 2026 results on Tuesday, April 28, 2026.
CoolIT closing expected in Q3 2026: Management expects the acquisition to close in the third quarter of 2026, subject to regulatory approvals and other customary closing conditions.

Figures management reported

Figure	Reported
Data centers in existing reach	more than 1,000
Countries with customers	more than 170

Earlier plans management reported on

Not stated: Management says it continues to expect the full-year 2026 adjusted diluted EPS range, excluding CoolIT.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

ECOLAB INC.

SUPPLEMENTAL REPORTABLE SEGMENT INFORMATION

AND NON-GAAP RECONCILIATION

(unaudited)

Year ended December 31 (millions)				2025				2024
			Fixed				Fixed
			Currency				Currency
	Values at		Rate	Values at	Values at		Rate	Values at
	2025 Rates	Other	Change	2026 Rates	2025 Rates	Other	Change	2026 Rates
Net Sales
Global Water	$7,679.9	$ -	$427.8	$8,107.7	$7,483.4	$ -	$420.4	$7,903.8
Global Institutional & Specialty	5,962.0	-	202.8	6,164.8	5,979.4	-	207.9	6,187.3
Global Pest Elimination	1,219.2	-	39.6	1,258.8	1,140.1	-	37.7	1,177.8
Global Life Sciences	706.1	-	61.0	767.1	670.5	-	59.4	729.9
Subtotal at fixed currency rates	15,567.2	-	731.2	16,298.4	15,273.4	-	725.4	15,998.8
Effect of foreign currency translation	514.0	-	(731.2)	(217.2)	468.0	-	(725.4)	(257.4)
Total reported GAAP net sales	$16,081.2	$ -	$ -	$16,081.2	$15,741.4	$ -	$ -	$15,741.4
Cost of Sales
Global Water	$4,585.9	($2.3)	$254.5	$4,838.1	$4,470.9	($1.2)	$246.9	$4,716.6
Global Institutional & Specialty	2,977.7	0.7	109.6	3,088.0	3,131.0	0.8	113.6	3,245.4
Global Pest Elimination	686.3	0.1	21.4	707.8	639.8	0.1	20.2	660.1
Global Life Sciences	382.6	1.5	29.0	413.1	382.6	0.3	30.4	413.3
Corporate	7.7	-	-	7.7	5.2	-	0.1	5.3
Total at fixed currency rates	$8,640.2	$ -	$414.5	$9,054.7	$8,629.5	$ -	$411.2	$9,040.7
Selling, General and Administrative Expenses
Global Water	$1,830.1	$3.1	$78.9	$1,912.1	$1,805.3	$4.3	$80.7	$1,890.3
Global Institutional & Specialty	1,626.5	(1.3)	53.5	1,678.7	1,646.2	(2.8)	53.8	1,697.2
Global Pest Elimination	295.8	0.4	10.2	306.4	290.6	(0.1)	9.9	300.4
Global Life Sciences	202.8	(2.2)	9.3	209.9	196.1	(1.4)	9.5	204.2
Corporate	195.2	-	4.2	199.4	195.6	-	4.2	199.8
Total at fixed currency rates	$4,150.4	$ -	$156.1	$4,306.5	$4,133.8	$ -	$158.1	$4,291.9
Special (Gains) and Charges
Corporate	$150.3	$ -	$ -	$150.3	($188.7)	$ -	$ -	($188.7)
Total at fixed currency rates	$150.3	$ -	$ -	$150.3	($188.7)	$ -	$ -	($188.7)
Operating Income
Global Water	$1,263.9	($0.8)	$94.4	$1,357.5	$1,207.2	($3.1)	$92.8	$1,296.9
Global Institutional & Specialty	1,357.8	0.6	39.7	1,398.1	1,202.2	2.0	40.5	1,244.7
Global Pest Elimination	237.1	(0.5)	8.0	244.6	209.7	-	7.6	217.3
Global Life Sciences	120.7	0.7	22.7	144.1	91.8	1.1	19.5	112.4
Corporate	(353.2)	-	(4.2)	(357.4)	(12.1)	-	(4.3)	(16.4)
Subtotal at fixed currency rates	2,626.3	-	160.6	2,786.9	2,698.8	-	156.1	2,854.9
Effect of foreign currency translation	111.3	-	(160.6)	(49.3)	103.6	-	(156.1)	(52.5)
Total reported GAAP operating income	$2,737.6	$ -	$ -	$2,737.6	$2,802.4	$ -	$ -	$2,802.4

Notes:

We evaluate the performance of our non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on our international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. The "Fixed Currency Rate Change” columns in the table above reflect international operations at fixed currency exchange rates established by management at the beginning of 2026, rather than the 2025 established rates. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported within the "Effect of foreign currency translation" rows in the table above for net sales and operating income.

The “Other” columns in the table above reflect immaterial changes between reportable segments, including the movement of certain customers and cost allocations.

The above table includes financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (“GAAP”), including fixed currency sales, fixed currency cost of sales, fixed currency selling, general and administrative expenses, fixed currency special (gains) and charges, and fixed currency operating income. We provide these measures as additional information regarding our operating results. We use these non-GAAP measures internally to evaluate our performance and in making financial and operational decisions, including with respect to incentive compensation. We believe that our presentation of these measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparison of results. These non-GAAP financial measures are not in accordance with, or an alternative to, GAAP and may be different from non-GAAP measures used by other companies. Investors should not rely on any single financial measure when evaluating our business. We recommend that investors view these measures in conjunction with the GAAP measures included in the table.