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Operator
Operator
Welcome to Xylem's Third Quarter 2023 Earnings Conference Call. (Operator Instructions)
歡迎參加賽萊默 2023 年第三季財報電話會議。 (操作員說明)
I would like to now turn the call over to Andrea van der Berg, Vice President, Investor Relations. Please go ahead.
我現在想將電話轉給投資人關係副總裁 Andrea van der Berg。請繼續。
Andrea van der Berg
Andrea van der Berg
Thank you, operator. Good morning, everyone, and welcome to Xylem's Third Quarter 2023 Earnings Call. With me today are Chief Executive Officer, Patrick Decker; Chief Operating Officer, Matthew Pine, Senior Adviser and former Chief Financial Officer, Sandy Rowland; and Chief Financial Officer, Bill Grogan. Bill will provide their perspective on Xylem's third quarter 2023 results and discuss the fourth quarter and full year outlook.
謝謝你,接線生。大家早安,歡迎參加賽萊默 2023 年第三季財報電話會議。今天與我在一起的有執行長 Patrick Decker;營運長 Matthew Pine,資深顧問兼前財務長 Sandy Rowland;和財務長比爾·格羅根。 Bill 將發表他們對賽萊默 2023 年第三季業績的看法,並討論第四季和全年的前景。
Following our prepared remarks, we will address questions related to the information covered on the call. I'll ask you please keep to one question and a follow-up and then return to the queue.
在我們準備好的發言之後,我們將回答與電話會議所涵蓋資訊相關的問題。我會請您繼續回答一個問題並跟進,然後返回隊列。
As a reminder, this call and our webcast are accompanied by a slide presentation available in the Investors section of our website. A replay of today's call will be available until midnight, November 7. Additionally, the call will be available for playback via the Investors section of our website under the heading Investor Events. Please turn to Slide 2.
謹此提醒,本次電話會議和我們的網路廣播均附有幻燈片演示文稿,可在我們網站的投資者部分查看。今天的電話會議重播將持續到 11 月 7 日午夜。此外,該電話會議還可以透過我們網站的「投資者」部分的「投資者活動」標題進行回放。請翻到投影片 2。
We will make some forward-looking statements on today's call, including references to future events or developments that we anticipate will or may occur in the future. These statements are subject to future risks and uncertainties such as those factors described in Xylem's most recent annual report on Form 10-K and in subsequent reports filed with the SEC. Please note that the company undertakes no obligation to update any forward-looking statements publicly to reflect subsequent events or circumstances, and actual events or results could differ materially from those anticipated. Please turn to Slide 3.
我們將在今天的電話會議上發表一些前瞻性聲明,包括提及我們預計未來將發生或可能發生的未來事件或發展。這些聲明受到未來風險和不確定性的影響,例如賽萊默最新的 10-K 表格年度報告以及隨後向 SEC 提交的報告中描述的因素。請注意,本公司沒有義務公開更新任何前瞻性聲明以反映後續事件或情況,實際事件或結果可能與預期有重大差異。請翻到幻燈片 3。
We've provided you with a summary of our key performance metrics, including both GAAP and non-GAAP metrics. For purposes of today's call, all references will be on an organic and/or adjusted basis, unless otherwise indicated, and non-GAAP financials have been reconciled for you and are included in the Appendix section of the presentation.
我們為您提供了關鍵績效指標的摘要,包括 GAAP 指標和非 GAAP 指標。就今天的電話會議而言,除非另有說明,所有參考資料都將基於有機和/或調整的基礎,並且非公認會計準則財務數據已為您進行了核對,並包含在演示文稿的附錄部分中。
Now please turn to Slide 4, and I'll turn the call over to our CEO, Patrick Decker.
現在請翻到幻燈片 4,我會將電話轉給我們的執行長 Patrick Decker。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Thanks, Andrea. Good morning, everyone, and thanks for joining us. By now, you'll see that our first full quarter as a combined company with Xylem and Evoqua together. The team delivered very strong performance across each of our segments. We significantly exceeded expectations on organic revenue growth, EBITDA margin and earnings per share. And revenue grew 10% organically. We expanded EBITDA margin well above prior year, and we delivered EPS of $0.99 for the quarter, which represents 14% growth year-over-year. Orders were up 3% and more importantly, our backlogs continue to grow, especially in our M&CS and ISS segments. Total backlog is now $5.2 billion. And this sets us up for continued growth momentum and demonstrates the health of our key end markets. So on the strength of this performance, we are raising our full year guidance.
謝謝,安德里亞。大家早安,感謝您加入我們。現在,您將看到我們與 Xylem 和 Evoqua 合併後的第一個完整季度。該團隊在我們的每個細分市場中都取得了非常出色的業績。我們對有機收入成長、EBITDA 利潤率和每股盈餘都大大超出了預期。收入有機增長 10%。我們的 EBITDA 利潤率遠高於去年同期,本季每股收益為 0.99 美元,較去年同期成長 14%。訂單成長了 3%,更重要的是,我們的積壓訂單持續成長,特別是在我們的 M&CS 和 ISS 領域。目前積壓總額為 52 億美元。這為我們的持續成長動力奠定了基礎,並展示了我們關鍵終端市場的健康狀況。因此,鑑於這一表現,我們正在提高全年指導。
I want to personally give a big shout out to the team for their strong operational performance during a period of integrating 2 large enterprises. Instead of getting distracted, the team continued to focus on serving our customers and delivering on our commitments. The integration of Evoqua is well on track to deliver the cost synergies we promised. It's those synergies that underwrote the transaction. But more importantly, it's the growth synergies that excite us the most. And our customers have already begun to experience the advantages of our combined capabilities.
我個人想對團隊在整合兩家大型企業期間的強勁營運表現表示大力讚揚。團隊沒有分心,而是繼續專注於服務客戶並兌現我們的承諾。 Evoqua 的整合正在順利實現我們承諾的成本綜效。正是這些協同效應支撐了這筆交易。但更重要的是,最讓我們興奮的是成長綜效。我們的客戶已經開始體驗我們綜合能力的優勢。
Overall, the quarter's strong result, it reflects our continued momentum, and that puts me in a very privileged position on my last earnings call as CEO of Xylem. In September, we announced a planned succession of both me as CEO and Sandy as CFO. Matthew Pine is going to lead Xylem as CEO beginning January 1. I'll remain on as an adviser through the end of March. I'd also like to formally welcome our new CFO, Bill Grogan, who is on the call with us today. He's alongside Sandy Rowland. Bill took on the role of CFO on October 1, and it's been a real pleasure to welcome him to the team. Now as Sandy was in the chair through beginning of September, she is going to cover the third quarter results. But that's not going to happen before I take the opportunity to thank her for her many significant contributions to Xylem. She's been a great partner and a great leader over the last few years with me and the team we simply would not be where we are today without her many contributions.
總體而言,本季的強勁業績反映了我們持續的發展勢頭,這使我在擔任賽萊默執行長的上一次財報電話會議上處於非常有利的位置。九月,我們宣布計劃繼任我擔任首席執行官,桑迪擔任財務長。 Matthew Pine 將從 1 月 1 日起擔任 Xylem 首席執行官,領導 Xylem。我將繼續擔任顧問直至 3 月底。我還要正式歡迎我們的新任財務長比爾‧格羅根 (Bill Grogan),他今天參加了我們的電話會議。他和桑迪·羅蘭並肩作戰。 Bill 於 10 月 1 日就任財務官,我們非常高興地歡迎他加入團隊。現在,桑迪在九月初擔任主席,她將報導第三季的業績。但在我藉此機會感謝她對賽萊默做出的許多重大貢獻之前,這一切都不會發生。在過去的幾年裡,她一直是我和團隊的一位出色的合作夥伴和領導者,如果沒有她的眾多貢獻,我們根本不可能取得今天的成就。
So now over to you, Sandy.
現在輪到你了,桑迪。
Sandra E. Rowland - Advisor
Sandra E. Rowland - Advisor
Thank you, Patrick. Before I go over the quarter's performance, I'd like to take a moment to congratulate Bill. In the short time since he stepped into the CFO role, I've been impressed with how quickly he has immersed himself in the business and taken on financial leadership of the company. Like Patrick, I will continue to stay on this as an adviser through March to ensure a smooth transition, but the company will be in great hands with Bill working alongside Matthew next year, and I couldn't be more confident in Xylem's future. And now let's look at the quarter. Please turn to Slide 5.
謝謝你,派崔克。在回顧本季的業績之前,我想花點時間祝賀比爾。自從他擔任財務長後的短時間內,我對他投入業務並承擔公司財務領導職務的速度印象深刻。和派崔克一樣,我將在三月繼續擔任顧問,以確保順利過渡,但明年比爾將與馬修一起工作,公司將得到很好的管理,我對賽萊默的未來充滿信心。現在讓我們看看這個季度。請翻到投影片 5。
As Patrick mentioned, the team has continued to deliver strong performance in Q3, exceeding expectations on growth margin expansion and earnings per share. Each segment outperformed, including Integrated Solutions & Services. As a reminder, since the combination with Evoqua, we began including ISS as our fourth reporting segment. For Xylem overall, total revenues grew 50%, while organic revenue rose 10%, led by particularly robust double-digit growth in the U.S. Western Europe grew a healthy 6% and emerging markets was down largely due to China despite strength in other parts of Asia and also in Africa. From an end market perspective, utilities grew 16%, mainly driven by robust demand and price realization in both M&CS and Water Infrastructure. Industrial grew 5%, driven by strong demand in the U.S. and healthy demand in Western Europe. Lastly, Building Solutions grew 3%, with strength in developed markets, more than offsetting moderation in Emerging Markets.
正如帕特里克所提到的,該團隊在第三季度繼續表現強勁,超出了成長率擴張和每股收益的預期。每個細分市場都表現出色,包括整合解決方案和服務。提醒一下,自從與 Evoqua 合併以來,我們開始將 ISS 作為我們的第四個報告部分。對賽萊默來說,整體營收成長了50%,而有機收入成長了10%,其中美國的兩位數成長尤為強勁。西歐健康成長了6%,新興市場的下滑主要歸因於中國,儘管其他地區表現強勁。亞洲也是如此,非洲也是如此。從終端市場的角度來看,公用事業公司成長了 16%,主要受到 M&CS 和水基礎設施領域強勁的需求和價格實現的推動。受美國強勁需求和西歐健康需求的推動,工業成長 5%。最後,建築解決方案成長了 3%,已開發市場表現強勁,足以抵銷新興市場的放緩。
Overall, demand remains resilient. Our backlog is now $5.2 billion, up 5% organically, and this includes a $1.3 billion contribution from Evoqua. Orders were up 3% in the quarter, and book-to-bill for the company was approximately 1. EBITDA margin was 19.8%, up 150 basis points from the prior year on higher volumes, productivity savings and favorable price cost dynamics. Our EPS in the quarter was $0.99, up 14% year-over-year. Please turn to Slide 6, and I'll review each segment's third quarter performance in a bit more detail.
整體而言,需求仍保持彈性。我們的積壓訂單目前為 52 億美元,有機成長 5%,其中包括 Evoqua 的 13 億美元貢獻。本季訂單成長 3%,公司的訂單出貨比約為 1。 EpITDA 利潤率為 19.8%,比上年增長 150 個基點,這得益於產量增加、生產力節省和有利的價格成本動態。本季我們的每股收益為 0.99 美元,年增 14%。請參閱投影片 6,我將更詳細地回顧每個部門的第三季業績。
M&CS revenue was up 25%, driven primarily by improved chip supply and backlog execution as well as strength in test and measurement. All regions saw double-digit growth led by an impressive 31% in the U.S. Orders were down in the quarter due to the timing of metrology orders, while Assessment Services saw strong growth. Year-to-date, book-to-bill remains above 1 for this segment. Our M&C backlog of $2.3 billion is up 11% organically versus the prior year a reflection of strong continuing demand for our AMI offerings and the accelerating trend towards digitization. EBITDA margin for the segment was up 190 basis points versus the prior year, driven by volume conversion, price realization and productivity more than offsetting inflation. And now let's turn to Slide 7, and I'll cover our Water Infrastructure business.
M&CS 收入成長了 25%,這主要得益於晶片供應和積壓執行的改善以及測試和測量方面的實力。所有地區都實現了兩位數的增長,其中美國的訂單增長了 31%,令人印象深刻。由於計量訂單的時間安排,本季度訂單有所下降,而評估服務則實現了強勁增長。年初至今,該細分市場的訂單出貨比仍高於 1。我們的 M&C 積壓訂單為 23 億美元,與前一年相比有機增長了 11%,這反映了對我們的 AMI 產品的強勁持續需求以及數位化趨勢的加速。在數量轉換、價格實現和生產力的推動下,該部門的 EBITDA 利潤率比上一年增長了 190 個基點,其影響力超過了通貨膨脹。現在讓我們轉向投影片 7,我將介紹我們的水基礎設施業務。
Water Infrastructure outperformed due to stronger-than-expected price realization and backlog execution with reported growth of 40% and organic growth of 7%. As a reminder, we have integrated Evoqua's Applied Product Technologies business into the Water Infrastructure segment, further building out our treatment portfolio. This business outperformed expectations driven by stronger backlog execution. For both utilities and industrials, the U.S. saw robust growth, while Western Europe proved resilient, offsetting some weakness in Emerging Markets. Organic orders in the quarter were up 14% year-over-year, and each region saw double-digit growth, with particular strength in developed markets. EBITDA margin for the segment was up 50 basis points and 80 basis points when excluding the contribution of Evoqua. Please turn to Slide 8 for an overview of Applied Water.
由於價格實現和積壓執行強於預期,水務基礎設施表現優於預期,報告成長 40%,有機成長 7%。提醒一下,我們已將 Evoqua 的應用產品技術業務整合到水基礎設施領域,進一步建立我們的處理產品組合。由於積壓執行力更強,該業務的表現超出了預期。對於公用事業和工業而言,美國實現了強勁成長,而西歐則表現出彈性,抵消了新興市場的一些疲軟。本季有機訂單年增 14%,每個地區均實現兩位數成長,其中已開發市場尤其強勁。該部門的 EBITDA 利潤率成長了 50 個基點,排除 Evoqua 的貢獻則增加了 80 個基點。請參閱投影片 8 以了解應用水的概述。
Applied Water revenues grew 1% on continued backlog execution, modestly better than expectations of flat revenue growth. Growth in Building Solutions was driven by continued strength in commercial, particularly in the U.S. While Industrial was down modestly, there was resilient growth in developed markets, offset by moderation in emerging markets. Orders were up 2% in the quarter on strength in the U.S. and segment EBITDA margin expanded 20 basis points with continued strong price cost dynamics and productivity more than offsetting volume declines. Please turn to Slide 9.
由於積壓訂單的持續執行,Applied Water 營收成長了 1%,略好於營收成長持平的預期。建築解決方案的成長受到商業領域(尤其是美國)持續強勁的推動。雖然工業領域小幅下滑,但已開發市場出現彈性成長,但被新興市場的放緩所抵消。由於美國市場強勁,本季訂單成長 2%,部門 EBITDA 利潤率擴大 20 個基點,持續強勁的價格成本動態和生產力足以抵銷銷售下降。請翻到投影片 9。
Last quarter, we introduced Integrated Solutions and Services as our fourth segment. ISS brings a durable recurring revenue base from businesses, including outsourced water, which provide outcome-based treatment services to customers. In its first full quarter with Xylem, ISS revenue exceeded our expectations as implied in our reported guidance. On a pro forma basis, ISS revenue grew 10% year-over-year driven by strong price realization and backlog execution. Orders grew on a pro forma basis by 12% year-over-year with broad-based demand across industrials and utilities. Book-to-bill was greater than 1 and backlog exceeded $1 billion to end the quarter, up 14% year-over-year on a pro forma basis. Adjusted EBITDA margin was strong at 22.6%, driven by price realization and productivity. And now let's turn to Slide 10 for an overview of cash flows and the company's financial position.
上季度,我們推出了整合解決方案和服務作為我們的第四個部門。 ISS 為企業帶來了持久的經常性收入基礎,包括為客戶提供基於結果的處理服務的外包水務。在與賽萊默合作的第一個完整季度中,ISS 的收入超出了我們報告的指導中所暗示的預期。預計,在強勁的價格實現和積壓執行的推動下,ISS 營收年增 10%。由於工業和公用事業領域的廣泛需求,預計訂單將年增 12%。截至本季末,訂單出貨比大於 1,積壓訂單超過 10 億美元,預計將年增 14%。受價格實現和生產力的推動,調整後 EBITDA 利潤率高達 22.6%。現在讓我們轉向投影片 10,了解現金流量和公司財務狀況的概述。
Our position remains robust as we exit the quarter with over $700 million in cash and available liquidity of $1.7 billion. Net debt-to-EBITDA leverage is 1.2x and year-to-date, we had adjusted free cash flow conversion of 94%. Please turn to Slide 11, and I'll hand it back over to Patrick.
當我們在本季結束時,我們擁有超過 7 億美元的現金和 17 億美元的可用流動性,我們的地位仍然強勁。淨債務與 EBITDA 的槓桿率為 1.2 倍,年初至今,我們調整後的自由現金流轉換率為 94%。請翻到投影片 11,我會將其交還給派崔克。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Thanks, Sandy. Today is the 12th anniversary of Xylem's listing on the New York Stock Exchange. And I think it's pretty fair to say that 12 years ago, water wasn't very widely recognized as an investable thesis. But since then, intensifying secular trends have made absolutely clear the value of a platform of solutions to meet the global order challenges. In that time, Xylem has evolved in our composition, our scale and our impact, but our investment thesis has remained constant.
謝謝,桑迪。今天是賽萊默在紐約證券交易所上市 12 週年。我認為可以公平地說,12 年前,水並沒有被廣泛認為是一個可投資的主題。但從那時起,不斷加劇的長期趨勢已經明確表明了應對全球秩序挑戰的解決方案平台的價值。在那段時間裡,賽萊默的組成、規模和影響力都在不斷發展,但我們的投資理念始終保持不變。
It's one that's focused on a multiyear runway of attractive organic growth with sustainable margin expansion, and strong free cash flow conversion. And it's that financial strength and confidence that allows us to effectively deploy capital as we continue building a differentiated market-leading water solutions platform. Under that thesis, we built a very durable business model and Xylem colleagues and partners around the world are creating significant economic and social value as we serve our customers and communities around the world. I am both proud of what we built for, but also excited to see what Xylem is capable of becoming under Matthew's leadership.
它專注於多年有吸引力的有機成長、可持續的利潤擴張和強勁的自由現金流轉換。正是這種財務實力和信心使我們能夠有效地部署資本,繼續打造差異化的市場領先水解決方案平台。根據論文,我們建立了一個非常持久的商業模式,賽萊默在世界各地的同事和合作夥伴在為世界各地的客戶和社區提供服務的同時,正在創造巨大的經濟和社會價值。我既為我們的目標感到自豪,也很高興看到賽萊默在 Matthew 的領導下能夠取得什麼樣的成就。
Matthew and I have worked side-by-side for the past 3.5 years. So this handover is progressing very smoothly. And I have total confidence he will lead this team to realize the full promise of our strategy and created an even greater impact in value in the years to come. So now over to you, Matthew.
過去 3.5 年裡,Matthew 和我並肩工作。所以說這次交接進展得非常順利。我完全相信他將帶領這個團隊實現我們策略的全部承諾,並在未來幾年創造更大的價值影響。現在輪到你了,馬修。
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Thank you, Patrick. I am grateful and energized the prospect of building on Xylem's momentum in creating our next phase of growth and impact. I'm also deeply grateful for Patrick's passionate visionary leadership. His legacy is Xylem's bright future, having put Xylem firmly on a path of continuing profitable growth. The strength of our partnership is making it easy to deliver the continuity essential to all stakeholders in this handover as we approach the turn of the year. And as Patrick said, our thesis is constant, our strategy is sound, and we are committed to our long-range plan. As team is solving customers' greatest water challenges with the most advanced platform of solutions in the world. In a fragmented complex market, that integrated offering is a distinctive competitive advantage. The opportunity ahead of us is to make it easier for even more customers to access the full range of capabilities they need to solve their most critical water challenges.
謝謝你,派崔克。我對利用賽萊默的勢頭創造下一階段的成長和影響力的前景感到感激和充滿活力。我也深深感謝派崔克充滿熱情、有遠見的領導。他的遺產是賽萊默的光明未來,使賽萊默堅定地走上持續獲利成長的道路。我們的合作關係的優勢在於,在新年即將到來之際,我們可以輕鬆地在這次移交中為所有利益相關者提供至關重要的連續性。正如派崔克所說,我們的論點是不變的,我們的策略是合理的,我們致力於我們的長期計劃。團隊正在利用世界上最先進的解決方案平台來解決客戶面臨的最大的水挑戰。在分散的複雜市場中,這種整合的產品是一種獨特的競爭優勢。我們面臨的機會是讓更多客戶更輕鬆地獲得解決最關鍵的水挑戰所需的全部功能。
In the process, we'll grow our penetration, our profitability, our durability and our impact. The team and I look forward sharing more color about the next phase of our growth at an Investor Day in May next year. We'll provide a further update on our combined company opportunity and long-range plan then. In the meantime, I'm pleased to share our near-term outlook. I'll provide a brief update on our Evoqua integration and then a picture of what we expect in our end markets over the next period. And then finally, I'll ask Bill to provide guidance for the remainder of the year. Moving to Slide 12.
在此過程中,我們將提高我們的滲透率、獲利能力、耐用性和影響力。我和我的團隊期待在明年五月的投資者日分享更多有關我們下一階段成長的資訊。屆時我們將提供有關我們合併後的公司機會和長期計劃的進一步更新。同時,我很高興與大家分享我們的近期展望。我將簡要介紹我們的 Evoqua 整合情況,然後介紹我們對下一階段終端市場的預期。最後,我將請比爾為今年剩餘時間提供指導。轉到投影片 12。
As you can see, the integration of Evoqua has gained quick momentum, and the team has come together remarkably fast. There's great collaboration, and we have the benefit of bringing 2 highly complemented cultures with a similar strong sense of purpose together. We committed $140 million of cost synergies within 3 years as well as exiting 2023 with a $40 million run rate. And as Patrick mentioned, that's well on track. But the rationale for the combination has always been about growth. The opportunity to create more value serving customers with our combined capabilities. In utilities, we'll deepen our penetration, especially with the addition of Evoqua's applied product technology offerings through our Water Infrastructure segment. The combination allows us to provide even more comprehensive treatment solutions in both clean water and wastewater.
正如您所看到的,Evoqua 的整合勢頭迅猛,團隊的凝聚速度也非常快。我們的合作非常出色,我們的優勢在於將兩種高度互補、具有相似強烈使命感的文化結合在一起。我們承諾在 3 年內實現 1.4 億美元的成本協同效應,並在 2023 年結束時實現 4000 萬美元的運行率。正如帕特里克所說,一切進展順利。但合併的理由始終是為了成長。透過我們的綜合能力為客戶創造更多價值的機會。在公用事業領域,我們將深化滲透,特別是透過我們的水基礎設施部門增加 Evoqua 的應用產品技術產品。這一組合使我們能夠在清潔水和廢水方面提供更全面的處理解決方案。
In Industrial, we will scale our presence in attractive verticals with services offerings of ISS. We see long-term market expansion in growing verticals such as microelectronics, power, life sciences and food and beverage. And geographically, we will scale Evoqua's products and solutions internationally, including the service business by leveraging Xylem's global distribution platform. Both Xylem and Evoqua were market leaders on their own. But together, we're in even a stronger position. We are already seeing the benefits of scale, reach and integrated offerings and a robust pipeline of global opportunities as well as the combined wins both teams are posting.
在工業領域,我們將透過 ISS 的服務產品擴大在有吸引力的垂直領域的影響力。我們看到微電子、電力、生命科學以及食品和飲料等不斷增長的垂直行業的長期市場擴張。在地理上,我們將利用賽萊默的全球分銷平台在國際上擴展 Evoqua 的產品和解決方案,包括服務業務。 Xylem 和 Evoqua 本身都是市場領導者。但只要我們齊心協力,我們的地位就更強大。我們已經看到了規模、覆蓋範圍和整合產品的優勢,以及強大的全球機會管道以及兩個團隊所取得的全面勝利。
And as we integrate our 2 businesses even more deeply, we'll take advantage of the opportunity to optimize our portfolio for growth. That will include structuring our offerings in ways that are matched to how our end markets address water management. The job is to make it even simpler for them to access solutions they need, and we're already hearing how customers appreciate having fewer vendors to coordinate across multiple domains. Now let's turn to Slide 13, and I'll cover the outlook for our end markets.
隨著我們更深入地整合我們的兩項業務,我們將利用這個機會來優化我們的投資組合以實現成長。這將包括以與我們的終端市場解決水管理問題相符的方式建立我們的產品。我們的工作是讓他們更輕鬆地獲得所需的解決方案,而且我們已經了解到客戶非常喜歡更少的供應商來在多個領域進行協調。現在讓我們轉向投影片 13,我將介紹我們終端市場的前景。
Our outperformance in the first three quarters of the year provides great momentum to build on. I especially want to echo Patrick shout out to all of our teams for delivering such a standout performance this year and in the third quarter. It's that kind of commitment and discipline that demonstrates the team's ability to execute through a dynamic macroeconomic environment. That said, we continue to take a balanced outlook and are monitoring signs of softness on a regional level particularly in China and some end markets addressed by our Applied Water segment.
我們今年前三個季度的優異表現為我們提供了巨大的發展動力。我特別想呼應帕特里克,對我們所有團隊今年和第三季的出色表現表示讚賞。正是這種承諾和紀律證明了團隊在動態宏觀經濟環境中執行的能力。也就是說,我們繼續採取平衡的前景,並正在監測區域層面的疲軟跡象,特別是在中國和我們的應用水部門所涉及的一些終端市場。
As a reminder, our 2023 outlook is expressed on an organic basis. At a high level, we anticipate that utilities demand will continue to be resilient and industrial demand will provide steady growth. Utilities compromise approximately 45% of revenue, they continue to show healthy demand, and we continue to expect growth of mid-teens. On the clean water side, we continue to see robust demand for our AMI solutions. On top of that, we're driving backlog execution on improved chip supply, and we're seeing even more traction on solution selling with our digital platform as customers increasingly value bundled offerings. We now anticipate growth of mid-20s, up from low 20s previously. On the wastewater side, OpEx is expected to remain resilient in developed markets alongside steady CapEx spend across regions, underpinning demand. We expect to see high single-digit growth in wastewater overall.
提醒一下,我們的 2023 年展望是有機表達的。在較高層面上,我們預期公用事業需求將持續保持彈性,工業需求將穩定成長。公用事業約佔收入的 45%,它們繼續表現出健康的需求,我們繼續預計成長將達到 15%左右。在清潔水方面,我們繼續看到對我們的 AMI 解決方案的強勁需求。最重要的是,我們正在推動改善晶片供應的積壓執行,隨著客戶越來越重視捆綁產品,我們看到透過我們的數位平台銷售解決方案的吸引力更大。我們現在預計成長將達到 20 多歲,高於之前的 20 多歲。在廢水處理方面,預計已開發市場的營運支出將保持彈性,同時各地區的資本支出也將保持穩定,從而支撐需求。我們預計廢水總量將出現個位數的高成長。
Turning to industrial end market, which is about 45% of our revenue, we now expect global growth of high single digits, up from mid-single digits. Developed markets continue to be resilient, although there are pockets of moderation in Emerging Markets. Lastly, in Building Solutions, which is about 10% of our revenue, we continue to expect growth of mid-single digits, driven by steady replacement business, particularly in commercial applications. Overall, the demand outlook continues to be positive despite some variability in macro indicators. While the organic view does not include Evoqua, the demand profile in ISS is resilient on the foundation of recurring revenues further increasing the durability of our business.
談到約占我們收入 45% 的工業終端市場,我們現在預計全球成長將從中個位數上升到高個位數。儘管新興市場存在一些放緩,但已開發市場仍持續保持彈性。最後,在建築解決方案方面,約占我們收入的 10%,我們繼續預計,在穩定的替代業務(尤其是商業應用領域)的推動下,該業務將實現中個位數的成長。總體而言,儘管宏觀指標存在一些變化,但需求前景仍然樂觀。雖然有機觀點不包括 Evoqua,但 ISS 的需求狀況在經常性收入的基礎上具有彈性,進一步提高了我們業務的耐用性。
Now I have the pleasure of turning the call over to Bill for the first time to walk through our Q4 guidance.
現在,我很高興第一次將電話轉給比爾,以詳細介紹我們的第四季指導。
William K. Grogan - Senior VP & CFO
William K. Grogan - Senior VP & CFO
Thanks, Matthew, and thanks Patrick and Sandy, for your kind words. I'm incredibly grateful to Sandy for being so generous for their insight about the business during this handover. She has built a strong team and culture, and I wish her well in her new endeavors. I want to start by saying how excited I am to join the Xylem team. I've long admired the company, both because of its rise to sector leadership and also because of its distinctive commitment to both social and economic value creation. And now a month in, I'm even more compelled by the opportunities ahead of us. It is a privilege to be part of the team that will take Xylem forward, building on this extraordinary platform and performance.
謝謝馬修,也謝謝派崔克和桑迪的客氣話。我非常感謝桑迪在這次移交期間如此慷慨地提供了對業務的見解。她建立了強大的團隊和文化,我祝福她在新的事業中一切順利。首先,我想說加入賽萊默團隊讓我感到多麼興奮。我長期以來一直欽佩該公司,不僅因為它崛起為行業領導者,還因為它對社會和經濟價值創造的獨特承諾。現在一個月過去了,我對眼前的機會更加著迷。我很榮幸成為團隊的一員,在這個非凡的平台和性能的基礎上,推動賽萊默向前發展。
As Patrick mentioned, we are increasing our full year revenue, EBITDA margin and EPS guidance. Full year revenue will now be approximately $7.3 billion. This translates the total revenue growth of about 32% and organic revenue growth of about 11%, up from 9% to 10% previously. We are raising EBITDA margin of approximately 19%, up from 18%, driven by higher volume, stronger price realization and productivity initiatives. This reflects about 200 basis points of margin expansion versus the prior year. In addition, we are lifting full year adjusted EPS guidance to $3.71 to $3.73, up from $3.60 at the midpoint. The revised guidance breaks down by segment as follows low 20s growth in M&CS, up from approximately 20% previously, high single digit growth in Water Infrastructure and mid-single-digit growth in Applied Water. And we remain committed to achieving free cash flow conversion of above 100% of net income. We have also provided you with a number of full year assumptions in the appendix on Slide 19.
正如帕特里克所提到的,我們正在增加全年收入、EBITDA 利潤率和每股收益指引。目前全年收入約 73 億美元。這意味著總收入成長約 32%,有機收入成長約 11%,從先前的 9% 上升到 10%。在產量增加、價格實現更強勁和生產力計劃的推動下,我們將 EBITDA 利潤率從 18% 提高到約 19%。這反映了利潤率較前一年擴大了約 200 個基點。此外,我們將全年調整後每股盈餘指引從中間值 3.60 美元上調至 3.71 美元至 3.73 美元。修訂後的指導意見按細分市場細分如下:M&CS 領域的成長率為20 多歲,高於先前的約20%;水基礎設施領域的高個位數成長;應用水領域的中個位數增長。我們仍致力於實現淨利潤100%以上的自由現金流轉換。我們也在投影片 19 的附錄中為您提供了一些全年假設。
And now drilling down in the fourth quarter. We anticipate total revenue growth will be in the 35% to 36% range on a reported basis and 4% to 5% organically. By segment, we expect revenue growth to be mid-teens in M&CS, low single digits in Water Infrastructure and remained flat in Applied Water. We expect fourth quarter EBITDA margin to be approximately 19.5% driven by higher volumes, continued price realization and productivity gains. This yields fourth quarter EPS of $0.94 to $0.96. Our operational discipline, commercial momentum and backlog strength give us confidence in the remainder of the year and delivering our long-term plan.
現在深入研究第四季。我們預計總收入成長將在報告基礎上的 35% 至 36% 範圍內,有機成長將在 4% 至 5% 範圍內。按細分市場劃分,我們預計 M&CS 領域的收入成長將達到中位數,水基礎設施領域的收入成長將低於個位數,應用水領域的收入成長將保持穩定。我們預計第四季 EBITDA 利潤率將在產量增加、價格持續實現和生產力提高的推動下約為 19.5%。這使得第四季度每股收益為 0.94 美元至 0.96 美元。我們的營運紀律、商業動力和積壓實力讓我們對今年剩餘時間和實現長期計畫充滿信心。
With that, please turn to Slide 15, and I'll turn the call back over to Patrick for closing comments.
接下來,請前往投影片 15,我會將電話轉回給派崔克以徵求結束意見。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Thanks, Bill, and thank you, Matthew and Sandy. This is a bittersweet moment for me. I'm wrapping up my last earnings call with Xylem. Leading in helping build this enterprise has been absolutely the greatest privilege of my career. I'm so proud of what the team has achieved in the past 10 years. Of the work that we've done alongside our partners, serving our customers and communities and of the value we've created together. That said, it's clear to me personally, we are only just beginning to realize our full potential. Xylem is strongly positioned, our momentum is accelerating and there has never been a greater need for solutions to the world's water challenges. It's incredibly gratifying to note that me, that my more than 22,000 Xylem colleagues and our partners are going to take the work of solving water forward under an exceptionally strong leadership team. We are poised to have an even greater impact and to create even more value in the many years to come.
謝謝比爾,謝謝馬修和桑迪。這對我來說是一個苦樂參半的時刻。我即將結束與賽萊默最後一次的財報電話會議。領導幫助建立這家企業絕對是我職業生涯中最大的榮幸。我對團隊在過去 10 年所取得的成就感到非常自豪。我們與合作夥伴一起所做的工作,為我們的客戶和社區提供服務,以及我們共同創造的價值。也就是說,我個人很清楚,我們才剛開始實現我們的全部潛力。賽萊默處於強勢地位,我們的發展勢頭正在加速,對解決世界水挑戰的解決方案的需求從未如此迫切。我非常高興地看到,我、我的 22,000 多名賽萊默同事和我們的合作夥伴將在異常強大的領導團隊的領導下繼續推進解決水資源問題的工作。我們準備在未來的許多年裡產生更大的影響並創造更多的價值。
On a final personal note to the many of you whose jobs include closely tracking and analyzing our business, I've come to know you quite well as you followed Xylem's growth. I admire and respect the work that you do, all the very best to each of you and simply go keep making a difference.
最後,我要向你們中的許多人提一點個人意見,你們的工作包括密切追蹤和分析我們的業務,隨著你們關注賽萊默的發展,我對你們非常了解。我欽佩並尊重你們所做的工作,祝福你們每個人都一切順利,繼續做出改變。
Now, we're going to take your questions. And so operator, let's open it up for Q&A.
現在,我們將回答您的問題。那麼操作員,讓我們打開它進行問答。
Operator
Operator
(Operator Instructions) We'll take our first question from Deane Dray with RBC Capital Markets.
(操作員說明)我們將回答 RBC 資本市場的 Deane Dray 提出的第一個問題。
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
You have to indulge me. I need to start with some important congratulations. So let me just rattle through them here. So Sandy, thank you for all your help and wish you all the best. Matthew, you and I have already connected twice in person since the announcement. But in my view, you've got the right skill set and leadership to lead Xylem from here, so congrats. And Bill, welcome, and I don't want to put too much pressure on you, but we are expecting the same sort of elite CFO contribution that we saw for years at IDEX. So congrats and welcome to you. All right. So -- and Patrick, no tissues here, but you've had a fabulous 10-year run you're handing off the reins truly in it from a position of strength. And I just remember, when you joined Xylem, it was a company that thought of itself as a pump company. I mean, that's what they said. And the entire portfolio has evolved to where I love how you phrase it, you're solving water. So just you should feel really proud about how you develop the company and the portfolio and the leadership team. So congrats.
你必須縱容我。我需要先表達一些重要的祝賀。讓我在這裡簡單介紹一下它們。桑迪,感謝您的幫助並祝您一切順利。馬修,自從宣布這一消息以來,你和我已經私下聯繫了兩次。但在我看來,您擁有正確的技能和領導能力來領導賽萊默,所以恭喜您。 Bill,歡迎,我不想給你太大的壓力,但我們期待著我們多年來在 IDEX 看到的同樣的精英財務長的貢獻。恭喜並歡迎您的到來。好的。所以——帕特里克,這裡沒有紙巾,但你已經經歷了令人難以置信的 10 年運行,你正在從一個強有力的位置真正地交出控制權。我只記得,當您加入賽萊默時,這是一家將自己視為泵公司的公司。我的意思是,他們就是這麼說的。整個產品組合已經發展到我喜歡你的措辭,你正在解決水問題。因此,您應該對您如何發展公司、投資組合和領導團隊感到非常自豪。所以恭喜。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Thank you, Deane, and that means a lot coming from you. You've been here from the beginning.
謝謝你,迪恩,這對你來說意味著很多。你從一開始就在這裡。
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
Yes, sir. Yes, sir. All right. So let's just talk about the quarter if we could, and maybe start with Evoqua and how the business -- you're -- Matthew referenced some new wins. Just how have the revenue synergies started conversations with customers, what will be the first opportunities maybe to take Evoqua's business with existing customers to Europe? So any color there would be helpful.
是的先生。是的先生。好的。因此,如果可以的話,讓我們來談談這個季度,也許可以從 Evoqua 開始,以及馬修如何提到了一些新的勝利。收入綜效如何開始與客戶對話?將 Evoqua 與現有客戶的業務帶到歐洲的第一個機會是什麼?所以任何顏色都會有幫助。
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. Thanks, Deane, for the question. Maybe I'll just start at a very high level and just talk about the guiding principles that Patrick really stated when we did the deal, which I think were really important to our execution. The first was we said we have to deliver on our '23 plans. And as you can see from Q3, really strong performance. As most of you know, that was the legacy Evoqua's business Q4 in this past fiscal calendar Q3. So great execution by the team, and I couldn't be happier.
是的。謝謝迪恩提出的問題。也許我會從一個非常高的層面開始,談談派崔克在我們完成交易時真正闡述的指導原則,我認為這對我們的執行非常重要。第一個是我們說我們必須實現我們的 23 計劃。正如您從第三季度看到的那樣,表現非常強勁。正如你們大多數人所知,這是 Evoqua 在上一財年第三季遺留下來的第四季業務。團隊的執行力如此出色,我感到非常高興。
The second, we need to make sure we deliver on the value capture of the cost and revenue synergies. And on this -- what I would call the softer side, which is equally as important when you bring 2 companies together, is to make sure we get the right talent on the field of the pitch, if you will, and make sure we retain top talent. We've done a really nice job there. And then lastly, bringing the best of both cultures together.
其次,我們需要確保實現成本和收入協同效應的價值捕獲。在這一點上,我稱之為軟性的一面,當你將兩家公司合併在一起時同樣重要,那就是確保我們在球場上找到合適的人才(如果你願意的話),並確保我們保留頂尖人才。我們在那裡做得非常好。最後,將兩種文化的精華結合在一起。
So obviously, the work is not done, but we're off to a good start, and those guiding principles have helped really get momentum in the business. Just quickly on cost synergies, we're tracking to the $40 million exit rate that we talked about in those 3 buckets of corporate cost, procurement and footprint. But more so on the revenue synergies, which you're getting at, Deane, the momentum is strong. We've just completed the APT integration into water infrastructure, which is really a milestone for us. We've appointed regional synergy leads in each one of the regions to drive the value capture. The incentives are in place and the training is ongoing both for the sales team as well as the services organization.
顯然,工作尚未完成,但我們已經有了一個良好的開端,這些指導原則確實幫助我們獲得了業務動力。很快就成本協同效應而言,我們正在追蹤我們在企業成本、採購和足跡這三個方面談到的 4000 萬美元的退出率。但更重要的是,迪恩,你所看到的收入綜效,勢頭很強勁。我們剛剛完成了 APT 與水利基礎設施的集成,這對我們來說確實是一個里程碑。我們在每個地區都任命了地區協同領導者來推動價值獲取。銷售團隊和服務組織的激勵措施已經到位,並且培訓正在進行中。
The short term, as you talk about, really, the short term, we're focused on cross-selling our products into industrial and back into municipal. But I think the services, which I'll touch on in a minute, has been the biggest surprise so far, midterm, we're going to leverage the Xylem footprint in Europe to bring capital products to customers to the Evoqua products that are international in bringing those folks from the U.S. to international.
短期而言,正如您所說,實際上,短期而言,我們的重點是將我們的產品交叉銷售到工業領域並返回市政領域。但我認為,我稍後會談到的服務是迄今為止最大的驚喜,中期,我們將利用賽萊默在歐洲的足跡,為客戶帶來國際化 Evoqua 產品的資本產品將這些人從美國帶到國際上。
And then lastly, long term, we're moving our services internationally. But I wanted to give you an example of an early synergy win. We have a power customer. It's oil and gas -- well, actually, it's an oil and gas customer. Where we do the process water for them, it's a build on operate, we do not do the wastewater. And they had their wastewater system go down and it was crippling their operations. So within really 48 hours, we were able to bring the legacy businesses together, both on the treatment side as well as the pumping and transport of wastewater in that facility and keep them up and running and also keep them away from having fines. We've had several examples like that where we can bring a full solution to the customer with one phone call. And I think that's really important. So off to a great start. There's many examples like that, but we'll be able to give a lot more context as we roll into 2024.
最後,從長遠來看,我們正在將我們的服務轉移到國際上。但我想給大家舉一個早期協同勝利的例子。我們有一個大客戶。它是石油和天然氣——嗯,實際上,它是石油和天然氣客戶。我們為他們提供製程用水,這是一個基於營運的過程,我們不處理廢水。他們的廢水系統癱瘓,導致他們的營運陷入癱瘓。因此,在真正的 48 小時內,我們能夠將處理方面以及該設施中廢水的泵送和運輸方面的遺留業務整合在一起,並使它們保持正常運行,並使它們免受罰款。我們有幾個這樣的例子,我們只需一個電話就可以為客戶提供完整的解決方案。我認為這非常重要。這是一個好的開始。類似的例子有很多,但隨著 2024 年的到來,我們將能夠提供更多背景資訊。
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
Deane Michael Dray - MD of Multi-Industry & Electrical Equipment & Analyst
That's all really good to hear. And if I could have a follow-up on M&CS. Just your update on the chip supply, it looks like we continue to see a gradual improvement there. And any comment about the orders in the third quarter and just kind of what the funnel looks like?
聽到這些真是太好了。如果我可以對 M&CS 進行後續跟進。只是您對晶片供應的更新,看來我們繼續看到那裡的逐步改善。對第三季的訂單以及漏斗是什麼樣子有什麼評論嗎?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes, I'll start with orders, and I'll come back to chip supply. Although we were down 11%, backlog is up 11%, $2.3 billion in M&CS, book-to-bill ratio greater than 1. Deane, that bid activity remains really strong. in M&CS, especially metrology. Really, the reason for the decline in orders in the quarter was more of a timing of the backlog conversion to orders. As you know, A lot of the larger AMI deals, they sit in backlog for a period of time, anywhere from 3 to 12 months, while the utility is getting ready for the deployment and when we receive the PO is when we book it as an order. So it's more of a timing issue and that can be a little bit lumpy. But in general, we're really bullish on AMI adoption and it's still fairly early innings.
是的,我將從訂單開始,然後我將回到晶片供應。儘管我們下降了 11%,但積壓訂單增加了 11%,M&CS 訂單達到 23 億美元,訂單出貨比大於 1。迪恩,投標活動仍然非常強勁。 M&CS,尤其是計量學。實際上,本季訂單下降的原因更多的是積壓訂單轉換為訂單的時機。如您所知,許多較大的 AMI 交易都會積壓一段時間,從 3 到 12 個月不等,而公用事業公司正在準備部署,當我們收到 PO 時,我們將其預訂為訂單。所以這更多的是一個時間問題,而且可能有點不穩定。但總的來說,我們非常看好 AMI 的採用,現在還處於相當早期的階段。
On the chip supply, the original guide this year for the business was low teens, we're in the low 20s. So we've seen continual gradual chip improvement quarter-over-quarter. I think this quarter, it came in a little faster than we had thought, and it can be lumpy, but really chip supply in Q3 was strong. We see that continued momentum into Q4, especially with our product redesigns. And then obviously, we've got -- with the backlog, we have a lot of potential in '24 in M&CS.
在晶片供應方面,今年的業務最初指導值為 10 多歲,我們目前處於 20 多歲。因此,我們看到晶片逐季持續逐步改進。我認為本季的出貨量比我們想像的要快一些,而且可能不穩定,但第三季的晶片供應確實很強勁。我們看到第四季的持續勢頭,尤其是我們的產品重新設計。顯然,由於積壓,我們在 24 年的 M&CS 領域有很大的潛力。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Deane, this is Patrick. Just to punctuate what Matthew has said, and that segment, again, orders are only a function of when POs are placed. The key metric there is what's happened with backlog. And again, the backlog is very healthy. The deal pipeline is very healthy and the win rate especially in North America, is very impressive for AMI.
迪恩,這是派崔克。只是為了強調 Matthew 所說的,以及那段話,訂單只是下訂單時間的函數。關鍵指標是積壓情況。再說一次,積壓的情況非常健康。交易管道非常健康,勝率尤其是在北美,對於 AMI 來說非常令人印象深刻。
Operator
Operator
And we'll take our next question from Mike Halloran with Baird.
我們將回答 Mike Halloran 和 Baird 提出的下一個問題。
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
So like Deane thanks, Patrick, for everything over the years. It's been a long run, but really appreciate everything. Sandy, same, not quite as long but best of luck moving forward. And obviously, Bill and Matthew, I look forward to working with both of you. So appreciate it, everyone.
所以,就像迪恩一樣,感謝派崔克這些年來所做的一切。已經過去很長時間了,但我真的很感激一切。桑迪,同樣的,沒有那麼長,但祝你好運。顯然,比爾和馬修,我期待與你們倆合作。所以大家要珍惜。
I don't think I've had 4 congratulations on the call before.
我想我之前在電話中還沒有收到 4 次祝賀。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Mike, we don't do things orthodox here. So -- but we do them the right way through it's called succession planning. So thank you.
麥克,我們這裡不做正統的事情。所以——但我們透過正確的方式來做這些事情,這就是所謂的繼任計畫。所以謝謝。
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
No problem. All right. So following up on Deane's M&CS order question, maybe broaden it out a little bit. As you think about end markets heading into 2024, I certainly appreciate Matthew's comments on the fourth quarter itself. Where are the optimistic points where the concern points? And a lot of moving pieces here, right? You have really strong backlog. You have some regulatory tailwinds that are starting to hit or at least it seems like it. But you also have this uncertain macro backdrop in some of these Emerging Market regions where there's a little less clarity. So maybe just talk about some of those moving pieces as you're thinking about next year and where you think there could be some demand sustainability or where you have a little bit more concern points?
沒問題。好的。因此,跟進 Deane 的 M&CS 訂單問題,也許可以稍微擴大範圍。當您思考進入 2024 年的終端市場時,我當然很欣賞 Matthew 對第四季本身的評論。樂觀點在哪裡,擔憂點在哪裡?這裡有很多動人的部分,對吧?你們的積壓量非常大。一些監管順風車開始發揮作用,或者至少看起來是這樣。但在一些新興市場地區也存在不確定的宏觀背景,這些地區的清晰度稍差一些。因此,也許只是談談您對明年的考慮,以及您認為哪些方面可能存在需求可持續性,或者哪些方面您還有更多關注點?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
No, it's a great question. Mike, we're committed to both the legacy businesses long-range plans that were presented back in '21. It did start right there and just get that out. And really, we have great momentum heading into next year with a platform that's been built by the Evoqua-Xylem combination.
不,這是一個很好的問題。麥克,我們致力於 21 年提出的遺留業務長期計劃。它確實從那裡開始,然後就把它拿出來。事實上,憑藉 Evoqua-Xylem 組合打造的平台,我們在明年的發展勢頭強勁。
If you look back over the past decade of Patrick's leadership, 50% of the company didn't exist 6 or 7 short years ago, and we're really operating from a position of strength in terms of the platform that has been built. So that feels really good as a jump-off point. I think if you kind of think about the macro drivers or favorable drivers, the secular trends continue to be strong scarcity of water, aged infrastructure and developed markets. Water quality is increasingly an issue and as many of us have seen this year with flooding happening all over the world. So those trends will continue, and they'll continue to buoy the business.
如果你回顧過去十年帕特里克的領導,你會發現公司 50% 的股份在六、七年前還不存在,而就已建立的平台而言,我們確實處於優勢地位。所以作為一個起點感覺非常好。我認為,如果你考慮宏觀驅動因素或有利驅動因素,長期趨勢仍然是嚴重缺水、基礎設施老化和已開發市場。水質日益成為一個問題,正如我們許多人今年所看到的那樣,世界各地都發生了洪水。因此,這些趨勢將持續下去,並將繼續提振業務。
Government funding, we talk a lot about the funding. It's going to be a dimmer switch. It's going to come over a period of time. But the next 6 to 7 years, we'll see continued trickle funding globally, not only in the U.S. I think the resiliency of our OpEx and utilities will continue to be a strong point. I think the ISS durable business model with the combination coming together with 75% services and aftermarket gives us a lot more diversity of cash flows as we move into '24. And then lastly, M&CS backlog, which we just talked about with the supply chain improvements, I think, they are all positive.
政府資助,我們談了很多關於資助的事情。這將是一個調光開關。它會在一段時間內到來。但未來 6 到 7 年,我們將看到全球範圍內持續的涓滴資金,而不僅僅是在美國。我認為我們的營運支出和公用事業的彈性將繼續成為一個優勢。我認為 ISS 持久的商業模式與 75% 的服務和售後市場相結合,為我們進入 24 世紀提供了更多樣化的現金流。最後,我們剛剛談到了 M&CS 積壓,以及供應鏈的改進,我認為它們都是正面的。
I think if I had to mention a few watch items, our more cyclical pieces of the portfolio with the end markets in Applied Water or definitely a watch item. There's pockets of industrial weakness. It's really niche when you think about ag or marine, but they're very small pieces of our business. But in general, industrials tended to hold up pretty well. And then I think the last thing I'd mention is China, which I mentioned in the opening comments, Industrial has remained pretty resilient in China for us. it's been the utilities, but it's been more on just a push to the right more than anything in China, which we can talk a little bit more about that later. But that's kind of the insights that we give. Obviously, in our February earnings call, we'll be able to give more color, but that's what I see right now.
我想,如果我不得不提一些觀察項目,我們的產品組合中更具週期性的部分以及應用水的終端市場,或者絕對是觀察項目。存在一些工業弱點。當你想到農業或海事時,這確實是一個利基市場,但它們只是我們業務的一小一部分。但整體而言,工業股往往表現良好。然後我想我要提到的最後一件事是中國,我在開場評論中提到過,對我們來說,工業在中國仍然保持著相當強的彈性。是公用事業公司,但在中國更多的是向右推動,我們稍後可以詳細討論這一點。但這就是我們提供的見解。顯然,在我們二月份的財報電話會議上,我們將能夠提供更多的色彩,但這就是我現在所看到的。
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
Michael Patrick Halloran - Associate Director of Research & Senior Research Analyst
Great. I appreciate that. And then second question, just on pricing and mix. So price cost in the quarter, it sounds like the backlog for M&CS is better than the margin profile today. Makes a lot of sense. Maybe just talk about some of those 2 dynamics as you're looking forward, ability to continue to manage the price side of things against resilient inflation and how we should think about mix on a forward basis?
偉大的。我很感激。然後是第二個問題,關於定價和組合。因此,本季的價格成本,聽起來 M&CS 的積壓訂單比今天的利潤狀況要好。很有道理。也許只是談談您所期待的這兩種動態中的一些,即繼續管理價格方面以應對彈性通膨的能力,以及我們應該如何在未來的基礎上考慮混合?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. Just price cost in Q3 continue to be positive for Xylem. We're up 70 bps. We expect pricing to moderate in 2024 as we lap previous increases. I think '24 is going to fall more in line with historical trends. But in terms of M&CS definitely, price cost contributed to a little bit of the incrementals this quarter. But we feel really positive in a step up in Q4 and into '24. We've taken some pricing actions that will start to really materialize into '24. And in terms of the mix, it will continue to be a little bit lumpy with energy, but we're working that backlog down, and we expect that to normalize as we get into '24.
是的。第三季的價格成本對賽萊默來說仍然是正面的。我們上漲了 70 個基點。我們預計 2024 年價格將會放緩,因為我們將超越先前的漲幅。我認為'24將會更符合歷史趨勢。但就 M&CS 而言,價格成本無疑對本季的增量做出了一些貢獻。但我們對第四季和進入 24 年的進步感到非常積極。我們已經採取了一些定價行動,這些行動將在 24 世紀開始真正實現。就混合而言,能源仍然會有點不穩定,但我們正在努力減少積壓,我們預計隨著進入 24 年,這種情況會正常化。
Operator
Operator
And we'll take our next question from Scott Davis with Melius Research.
我們將回答 Melius Research 的 Scott Davis 提出的下一個問題。
Scott Reed Davis - Founding Partner, Chairman, CEO & Research Analyst of Multi-Industry Research
Scott Reed Davis - Founding Partner, Chairman, CEO & Research Analyst of Multi-Industry Research
I'll let Deane's congratulations kind of take the lead for me. And since he's the elder statesman, I will defer to him, but I agree with everything he said, so congrats to everybody. Matthew, can you -- just on China, can you guys help us understand kind of the interplay between OpEx and CapEx? I mean when -- I assume it's all CapEx that's declined and pushed to the right, but is there a certain OpEx impact as well?
我會讓迪恩的祝賀為我帶頭。由於他是年長的政治家,我會尊重他,但我同意他所說的一切,所以我要祝賀大家。馬修,就中國而言,你們能幫助我們了解營運支出和資本支出之間的相互作用嗎?我的意思是,我認為所有資本支出都會下降並推向右側,但營運支出是否也會受到一定的影響?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes, I think it's Yes. In terms of China, yes, the under -- I'd just say the underlying demand does remain fairly healthy. Like I said, industrial has been more of resilient than utilities. But with regard to utilities, it's a little bit of a mixed bag. It's really timing of funding, not only for CapEx but also for OpEx as well. And as we've seen in the treatment piece of our business in China, it's been actually a little bit more resilient than transport. Transport tends to be a bit more OpEx-centric. So it's a little bit of a mixed bag, Scott, when it comes to the funding, it's both CapEx and OpEx.
是的,我認為是的。就中國而言,是的,我只想說潛在需求確實仍然相當健康。正如我所說,工業比公用事業更具彈性。但就公用事業而言,情況有點複雜。這確實是融資的時機,不僅對於資本支出,而且對於營運支出也是如此。正如我們在中國業務的治療部分所看到的,它實際上比運輸更有彈性。運輸往往更以營運成本為中心。所以,史考特,這有點魚龍混雜,在融資方面,既包括資本支出,也包括營運支出。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Scott, I guess, 2 weeks ago, I was there -- Scott 2 weeks ago, I was there for a week, and I spent time with our leadership Ping and the team and visited our locations in Nanjing, Shenyang, Shanghai traveled around, met with customers, met with the team and the whole purpose was to really get a sense for kind of how things feel in China. And all I can say is based upon our portfolio, what we have there. Yes, there are some near-term shifting to the right on when backlog gets converted on the utility side, but underlying demand is still very strong there. That market is very positive. And as many of you have heard me say before, as my father said, every generation thinks theirs is a last, this is my third time talking about the future of China in terms of demand for water and environment. And things felt very, very good in terms of robust underlying demand.
斯科特,我想,兩週前,我在那裡——斯科特,兩週前,我在那裡呆了一個星期,我與我們的領導平和團隊一起度過了時光,參觀了我們在南京、瀋陽、上海的工廠,與客戶會面,與團隊會面,整個目的都是為了真正了解中國的感受。我能說的只是基於我們的投資組合以及我們所擁有的。是的,當公用事業方面的積壓訂單轉換時,短期內會出現一些向右移動,但那裡的潛在需求仍然非常強勁。這個市場非常積極。正如你們許多人以前聽我說過的那樣,正如我父親所說,每一代人都認為自己的時代已經是最後一代了,這是我第三次談論中國在水和環境需求方面的未來。就強勁的潛在需求而言,情況感覺非常非常好。
Scott Reed Davis - Founding Partner, Chairman, CEO & Research Analyst of Multi-Industry Research
Scott Reed Davis - Founding Partner, Chairman, CEO & Research Analyst of Multi-Industry Research
That makes sense. I guess, I don't think I ever -- I'm not sure -- I haven't asked this question. I don't think you've talked about or maybe I have and I just didn't remember. But -- how are you integrating the R&D efforts between Evoqua and Xylem, how are you kind of integrating and eliminating duplication, if there was any, I would assume there'd be some maybe like an things like PFAS and things like that? And then how are you prioritizing projects with -- assuming there is some level of integration, but I'll just let you guys comment on that.
這就說得通了。我想,我想我從來沒有——我不確定——我沒有問過這個問題。我認為你沒有談論過,或者也許我談論過,但我只是不記得了。但是,你們如何整合 Evoqua 和 Xylem 之間的研發工作,你們如何整合和消除重複,如果有的話,我想可能會有一些像 PFAS 之類的東西?然後你如何確定專案的優先順序——假設有一定程度的集成,但我只是讓你們對此發表評論。
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. That's a great question. We haven't talked a lot about the R&D synergies, but for sure, they're there. Let me first start out by Snehal Desai, leading that team, and I'm actually here in D.C. today with his leadership team. So he comes over from the legacy Evoqua business. And yes, there is some overlap, especially when you think about the work that's being done in PFAS, both -- obviously, the capture technologies there about the destruction and the sensing is really where the innovation is required. And obviously, 1 plus 1 can equal 3 there, we were both working on that separately. But now together, we think we can get there more efficiently in a more expedited fashion. But in general, yes, there were different solutions that we were working on separately that as we come together, we can get leverage from that combined spend and really that effort.
是的。這是一個很好的問題。我們還沒有過多談論研發協同效應,但可以肯定的是,它們是存在的。首先讓我從領導團隊的 Snehal Desai 開始,實際上我今天和他的領導團隊一起來到華盛頓。因此,他從 Evoqua 的傳統業務中脫穎而出。是的,存在一些重疊,特別是當你想到 PFAS 中正在進行的工作時,顯然,關於破壞和感測的捕獲技術確實是需要創新的地方。顯然,1 加 1 可以等於 3,我們都在分別研究這個問題。但現在我們齊心協力,認為我們可以更有效、更迅速地實現這個目標。但總的來說,是的,我們正在分別研究不同的解決方案,當我們聚集在一起時,我們可以從合併的支出和真正的努力中獲得槓桿作用。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
And I think, Scott, I would just add that part of our innovation effort because R&D is only one part of innovation, was through the partnerships that we have through academia, venture capital, start-ups coming to us. And that's where I think the scale and platform of Xylem and our relationships will benefit what the legacy Evoqua business was looking to capture around things like PFAS, but other treatment solutions facing our customers.
我想,史考特,我只想補充我們創新努力的一部分,因為研發只是創新的一部分,是透過我們與學術界、創投、新創公司建立的合作關係實現的。我認為,賽萊默的規模和平台以及我們的關係將有利於傳統 Evoqua 業務希望圍繞 PFAS 等業務以及我們客戶面臨的其他處理解決方案所捕獲的內容。
Operator
Operator
And we'll take our next question from Nathan Jones with Stifel.
我們將回答 Nathan Jones 和 Stifel 提出的下一個問題。
Nathan Hardie Jones - Analyst
Nathan Hardie Jones - Analyst
I'll add my congratulations to Patrick and Sandy. And congratulations to Bill and Matthew. Maybe just Emerging Markets outside of China. I mean, you've talked about some of the issues that China during the quarter and not particular to your business, I don't think. But maybe you could talk about the emerging market performance outside of China.
我要向派崔克和桑迪表示祝賀。恭喜比爾和馬修。也許只是中國以外的新興市場。我的意思是,您談到了本季度中國的一些問題,但我認為這些問題並不是專門針對您的業務的。但也許你可以談談中國以外的新興市場的表現。
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. I think ex China Emerging Markets has been pretty resilient for us across all different end markets, Nate. I think with the exception would probably be a little bit of weakness in the Middle East and our Applied Water business. But in general, if you look at the other businesses, they've been really resilient outside of China, and have helped kind of buoy the -- a little bit of the tough push to the right that we've seen in China. That's across all different regions, Africa, Northern Asia, Southeast Asia, India, and Australia and New Zealand.
是的。內特,我認為中國以外的新興市場對我們在所有不同的終端市場都具有相當的彈性。我認為,中東和我們的應用水業務可能會有點疲軟。但總的來說,如果你看看其他企業,它們在中國以外的地區確實具有彈性,並且在某種程度上幫助推動了我們在中國看到的一點點艱難的右翼推動。這遍及所有不同地區:非洲、北亞、東南亞、印度、澳洲和紐西蘭。
Nathan Hardie Jones - Analyst
Nathan Hardie Jones - Analyst
I think for the follow-up, I'll ask about the Idrica partnership, Xylem (inaudible) adoption. You guys had some pretty broad presentations at ACE and at WesTech this year. So maybe you can talk about customer reception to those kinds of things and customer uptake for those kinds of things.
我想在後續行動中,我會問 Idrica 合作夥伴關係、Xylem(聽不清楚)採用情況。你們今年在 ACE 和 WesTech 上做了一些相當廣泛的演講。因此,也許您可以談論客戶對此類事物的接待以及客戶對此類事物的吸收。
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. No, it's been fabulous. Actually, it's exceeded our expectations. We've engaged over 200 customers globally. And it's -- the thing I'm excited about, it's been really balanced across the globe, both the U.S., Europe and Emerging Markets. We've got a tremendous pipeline build. We're working now on executing from orders to sales and deployment. I did -- if you remember, I highlighted -- I'm going to highlight a couple of examples. One was in the U.S. in the Southeastern city of large city we're able to, what I'd say, land and expand, we took the platform, the digital platform into the utility to aggregate all their applications, and then making it easy for them, then we bolted on 2 of our own applications, which is recurring revenue. And then from there, we picked up a $40 million AMI deal.
是的。不,這太棒了。事實上,它超出了我們的預期。我們已與全球 200 多家客戶合作。讓我感到興奮的是,全球(美國、歐洲和新興市場)的情況都非常平衡。我們已經建立了巨大的管道。我們現在正致力於從訂單到銷售和部署的執行。我做了——如果你還記得的話,我強調過——我將強調幾個例子。一個是在美國東南部的大城市,我們能夠,我想說的是,落地和擴張,我們將平台、數位平台引入到公用事業中,以聚合他們所有的應用程序,然後使其變得容易對於他們,我們安裝了2 個我們自己的應用程序,這是經常性收入。然後,我們獲得了價值 4000 萬美元的 AMI 交易。
So it's kind of land and expand, but it's also pulling through our products and solutions. On the heels of that, we just also picked up in Europe from a large European utility, $20 million of treatment in metrology in Southern Europe, same situation. They have the platform implemented, and we're able to leverage our relationship and pull through treatment and AMI solution.
所以這是一種土地和擴張,但它也推動了我們的產品和解決方案。緊隨其後,我們剛剛在歐洲從一家大型歐洲公用事業公司獲得了 2000 萬美元的南歐計量治療費用,同樣的情況。他們實施了該平台,我們能夠利用我們的關係並完成治療和 AMI 解決方案。
So I've talked a lot about the platform being the consolidator of utilities information. We believe that's true, but the pull-through we're getting in the relationships we're building allows us to bundle our offerings and that's really exciting.
因此,我已經多次談論該平台是公用事業資訊的整合者。我們相信這是事實,但我們正在建立的關係的拉動使我們能夠捆綁我們的產品,這真的很令人興奮。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
And Nate, Matthew, he led the effort on cultivating the Idrica opportunity over a number of years. And obviously, he's been involved in cultivating the Evoqua opportunity over a few years. What I would just offer up here is, this has always been, as we've said, about helping our customers turn the lights on their infrastructure to understand, have a better feel for what's going on. And infrastructure so that when they spend the next dollar of CapEx or OpEx where best to spend it. And I think the few opportunities that Matthew mentioned already, where it's the pull-through that is as much the opportunity as the initial services sell to the customer.
內特、馬修多年來一直致力於培育伊德里卡的機會。顯然,他多年來一直致力於培育 Evoqua 機會。我在這裡只想提供的是,正如我們所說,這一直是為了幫助我們的客戶打開他們的基礎設施,以了解、更好地了解正在發生的事情。和基礎設施,以便當他們將下一美元的資本支出或營運支出花在最好的地方時。我認為馬修已經提到的少數機會,其中的拉動與向客戶出售初始服務的機會一樣多。
Nathan Hardie Jones - Analyst
Nathan Hardie Jones - Analyst
Maybe you'll have to add a discussion on the revenue synergies from Idrica to the revenue synergies from Evoqua at the Analyst Day next year?
也許您必須在明年的分析師日上添加關於 Idrica 收入協同效應和 Evoqua 收入協同效應的討論?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. I think it's a good comment because we do think the platform has scalability into the industrial and building services business. Obviously, we're going to stay focused on utilities to it first. So we stay focused and deliver, but it does have ability to expand into industrial.
是的。我認為這是一個很好的評論,因為我們確實認為該平台具有擴展到工業和建築服務業務的能力。顯然,我們將首先關注它的實用程式。因此,我們保持專注並交付,但它確實有能力擴展到工業領域。
Operator
Operator
We'll take our next question from Joe Giordano with TD Cowen.
我們將回答 Joe Giordano 和 TD Cowen 提出的下一個問題。
Joseph Craig Giordano - MD & Senior Analyst
Joseph Craig Giordano - MD & Senior Analyst
Patrick Sandy, thank you for everything. Congratulations and with 5 simultaneous calls going on today for me, being done with earnings calls, sounds wonderful. So I'm very jealous for both of you. Congratulations. Bill, maybe I'll start with you, like as you come over from IDEX and you kind of want to bring the best of what that firm had. Like how do you kind of kick start in 80/20 kind of culture here? What's involved in really doing that and driving it to be like at the forefront.
帕特里克·桑迪,謝謝你所做的一切。恭喜你,今天我同時進行了 5 次電話會議,完成了財報電話會議,聽起來棒極了。所以我很嫉妒你們兩個。恭喜。 Bill,也許我會從你開始,就像你從 IDEX 過來一樣,你有點想把那家公司最好的東西帶來。例如你是如何融入這裡的 80/20 文化的?真正做到這一點並推動它走在最前沿涉及什麼?
William K. Grogan - Senior VP & CFO
William K. Grogan - Senior VP & CFO
Yes. No, great question. And the team had already started that issue before I got here. They recognize that -- it's a core tool that ultimately frees up organizational capacity, right? Its focus is to eliminate complexity, focus on the things that matter most. There's obviously the core analytics from a product and customer perspective, but thinking about more broadly and leveraging those tools to help enhance our strategy. So we're doing it very much like we did at IDEX, piloting it in a couple of locations, getting folks familiar with the tools and the concepts and they're rolling it out more thoroughly as we have initial successes and wins. So it is something, I think, that's going to have a tremendous amount of value, both on the top and bottom line, creating velocity to innovation for our customers and creating longer-term returns for our shareholders.
是的。不,很好的問題。在我到達這裡之前,團隊就已經開始解決這個問題了。他們體認到──這是最終釋放組織能力的核心工具,對嗎?它的重點是消除複雜性,專注於最重要的事情。顯然有從產品和客戶角度進行的核心分析,但更廣泛地思考並利用這些工具來幫助增強我們的策略。因此,我們的做法與 IDEX 的做法非常相似,在幾個地點進行試點,讓人們熟悉這些工具和概念,隨著我們取得初步成功和勝利,他們會更徹底地推廣它。因此,我認為,這將在營收和利潤方面都產生巨大的價值,為我們的客戶創造創新速度,並為我們的股東創造長期回報。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
And I think, this is Patrick. Sorry, Joe. That's all right. I'll just add that I think the way I would encourage investors to look at this is we've spent the last decade building a platform that customers can access for their needs, which means growth. And when you build that platform, then you have something to actually apply 80/20 to. And so that's why right now is the perfect time for this combination to be coming together and Bill coming in with his toolkit. The team had already been working on this, but I think what he brings to the table is going to be incredibly valuable to the enterprise in terms of value creation.
我想,這就是派崔克。對不起,喬。沒關係。我只想補充一點,我認為我鼓勵投資者看待這個問題的方式是,我們在過去十年中建立了一個客戶可以滿足其需求的平台,這意味著成長。當你建立這個平台時,你就有了可以實際應用 80/20 的東西。這就是為什麼現在是這個組合走到一起以及比爾帶著他的工具包進來的最佳時機。團隊已經在致力於此,但我認為他所帶來的成果對於企業在價值創造方面將具有難以置信的價值。
Joseph Craig Giordano - MD & Senior Analyst
Joseph Craig Giordano - MD & Senior Analyst
Is that concept even more applicable to the Evoqua platform. I just think of them as having been built from like almost that we have everything kind of ethos, right, of being nationally available and having tons of different products. It just feels like given the breadth of SKUs there, like maybe something like this, whether it's keeping everything and discharging appropriately? Or like is it just feels like it might be more appropriate for that business. Is that fair to think of...
這個概念是否更適用於 Evoqua 平台?我只是認為它們是建立在幾乎我們擁有一切精神的基礎上的,對吧,在全國範圍內提供並擁有大量不同的產品。感覺就像考慮到那裡的 SKU 範圍一樣,也許是這樣的,它是否保留了所有東西並適當地放電?或者只是感覺它可能更適合該業務。這麼想公平嗎?
William K. Grogan - Senior VP & CFO
William K. Grogan - Senior VP & CFO
On balance would be similar to the opportunities we have at Xylem. It's not hugely differentiated there. Obviously, there's a -- 80/20 is applicable to all different business models. So the service aspect versus a product-based organization, it's still a tool that will drive significant value.
總的來說,這與我們在賽萊默的機會類似。那裡差別不大。顯然,80/20 適用於所有不同的商業模式。因此,與以產品為基礎的組織相比,服務方面仍然是一個可以帶來巨大價值的工具。
Joseph Craig Giordano - MD & Senior Analyst
Joseph Craig Giordano - MD & Senior Analyst
Okay. And then just last for me. Is the infrastructure order rate, do you feel like that's stable here? Because it's a pretty -- it's probably a number that caught most people by surprise being that strong. So is that in dollars kind of a good number?
好的。然後就對我來說最後一次。基礎設施訂單率,您覺得穩定嗎?因為這個數字很漂亮——這個數字如此強勁,可能會讓大多數人感到驚訝。那麼以美元計算這是一個不錯的數字嗎?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. The water infrastructure order rate. Yes. It included a couple of big projects in custom pump. But in general, yes, we're seeing good demand, resilient demand both in developed markets and ex China and emerging markets. So we feel pretty good and it's been pretty resilient.
是的。水利基礎設施訂單率。是的。它包括幾個定制泵的大型項目。但總的來說,是的,我們看到已開發市場以及中國以外的新興市場的需求良好且富有彈性。所以我們感覺很好,而且很有彈性。
Operator
Operator
We'll take our next question from Andy Kaplowitz with Citigroup.
我們將回答花旗集團安迪·卡普洛維茨的下一個問題。
Andrew Alec Kaplowitz - MD & U.S. Industrial Sector Head
Andrew Alec Kaplowitz - MD & U.S. Industrial Sector Head
Patrick, Sandy, congrats. We'll miss you. Matt and Bill, we're looking forward to working with you. Maybe I could start, just -- it doesn't look like it, but are your customers outside of China changing their behavior at all based on higher interest rates or economic uncertainty. Your new public competitor in the water space mentioned that some North American municipalities are holding on plant upgrade and some investments, but it doesn't seem like that is what your utility or industrial companies are doing, but maybe you can give us some more color on what you're seeing?
派崔克,桑迪,恭喜。我們會想念你的。馬特和比爾,我們期待與您合作。也許我可以開始,只是——看起來不像,但中國以外的客戶是否會因為利率上升或經濟不確定性而改變他們的行為。你們在水領域的新公共競爭對手提到,一些北美城市正在堅持工廠升級和一些投資,但這似乎不是你們的公用事業或工業公司正在做的事情,但也許你們可以給我們更多的信息你所看到的是什麼?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes, I would just -- maybe just specific to utilities and wastewater. I think is a proxy for the question. Just a reminder that 50% of our revenue is outside the U.S. and 75% of that is OpEx which can be a little bit different in terms of the mix. We're seeing continued resiliency in orders in developed markets leading the way with Emerging Markets kind of minus China, like I said, to Joe contributing nicely. With regard to CapEx, I'd point to our treatment orders, which were up 6% in Q3 and we have a healthy funnel and pipeline up 8%. We have been reaching out to customers kind of qualitatively across section of customers across the globe. And specifically in the U.S., they don't really see a major funding shift in spending, plus the addition of stimulus money that's going to trickle in over time, Andy, I think will also help kind of keep things stable. But in general, we haven't really kind of seen anything that's alarming for us that would be a watch item.
是的,我只是——也許只是針對公用事業和廢水處理。我認為是這個問題的代理。只是提醒一下,我們 50% 的收入來自美國境外,其中 75% 是營運支出,這在組合方面可能略有不同。我們看到已開發市場的訂單持續彈性,領先新興市場,但正如我所說,喬做出了很好的貢獻。關於資本支出,我想指出的是我們的治療訂單,第三季成長了 6%,我們擁有健康的管道和管道,成長了 8%。我們一直以定性的方式接觸全球各地的客戶。特別是在美國,他們並沒有真正看到支出方面的重大資金轉變,再加上隨著時間的推移,刺激資金的增加,安迪,我認為這也將有助於保持局勢穩定。但總的來說,我們還沒有真正看到任何令我們震驚的手錶產品。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Andy, this is Patrick. Again, one thing I would offer to investors as you think about, I know we have some new entrants into the space. I think it's important that our investors understand that we've got the broadest water platform that's out there. And so I think drilling down into what percentage of our total revenue actually overlaps with some of our competitors that are out there is an important thing to pay attention to. The treatment bidding pipeline, as Matthew alluded to, is the single most important indicator as the health of the utilities over time. And that continues to be up, I think, mid- to high single digits. So that's a reflection of what the underlying health of the utilities are. And again, I just offer that as something for you all to focus on.
安迪,這是派崔克。再說一次,當你想到的時候,我想向投資者提供一件事,我知道我們有一些新進入者。我認為重要的是我們的投資者要了解我們擁有最廣泛的水平台。因此,我認為深入了解我們的總收入實際上與我們的一些競爭對手重疊的百分比是值得關注的重要事項。正如馬修所提到的,處理招標管道是隨著時間推移公用事業健康狀況的最重要指標。我認為,這數字仍在持續上升,達到中高個位數。因此,這反映了公用事業公司的基本健康狀況。再說一遍,我只是將其作為大家關注的焦點。
Andrew Alec Kaplowitz - MD & U.S. Industrial Sector Head
Andrew Alec Kaplowitz - MD & U.S. Industrial Sector Head
Definitely appreciate that color, guys. And then maybe I could ask you for a little more color on what you're seeing in the Applied Water segment and specifically across your channel and channel inventory there. Can you give us color to sellout versus sell-in, do you still see inventories in balance? And do you see a period of slower orders for that segment? Will they just continue to be a bit lumpy?
夥計們,絕對喜歡這種顏色。然後也許我可以要求您提供更多關於您在應用水領域看到的內容,特別是在您的渠道和渠道庫存方面的信息。您能否告訴我們售出與售入的情況,您仍然看到庫存平衡嗎?您是否認為該細分市場的訂單會放緩一段時間?他們會繼續有點笨拙嗎?
Matthew Francis Pine - COO
Matthew Francis Pine - COO
Yes. Andy, within our Applied Water business, we don't have a tremendous amount of stocking. Again, it's -- if you kind of look at resi commercial of the overall Xylem business, it's only 10%. But a lot of our orders, Andy, are configured to order, engineered to order. So they're for a specific job. Yes, we have book and ship. It's mainly in our resi business and a little bit commercially. And a lot of that has kind of worked itself out. If you look at our compares on the resi business, which makes up 3% of our business, we're up on a year-over-year basis, and we've kind of hit the bottom and we're coming out of the downturn on resi. But again, it's a small part of our portfolio.
是的。安迪,在我們的應用水業務中,我們沒有大量的庫存。再說一次,如果你看看整個 Xylem 業務的 Resi Commercial,你會發現它只佔 10%。但安迪,我們的許多訂單都是按訂單配置、按訂單設計的。所以他們是為了特定的工作。是的,我們有書和船。主要是我們的樹脂業務,還有一點商業業務。其中很多事情已經自然解決了。如果你看一下我們對 Resi 業務的比較,該業務占我們業務的 3%,我們的同比增長,而且我們已經觸底,我們正在走出困境。 RESI 低迷。但同樣,它只是我們產品組合的一小部分。
Operator
Operator
This concludes the Q&A portion of today's call. I would now like to turn the floor over to Patrick Decker for closing remarks.
今天電話會議的問答部分到此結束。現在我想請 Patrick Decker 致閉幕詞。
Patrick K. Decker - President, CEO & Director
Patrick K. Decker - President, CEO & Director
Well, thank you, I mean, it's been a great privilege to work with such an extraordinary set of colleagues and partners over the past nearly 10 years. I couldn't be more proud of where we are today. And I'm looking forward to saying all that Matthew, Bill and the team are going to do as they tail them into its next chapter. The work has never been more important as to what Xylem is doing. And this company has never been better positioned to make a difference as we're committed to doing with our customers and communities around the world. Again, I want to thank everyone, and all the very best to you and your families.
嗯,謝謝你們,我的意思是,在過去近 10 年裡與如此出色的同事和合作夥伴一起工作是我的榮幸。我對我們今天的處境感到非常自豪。我期待著說出馬修、比爾和團隊在進入下一章時將要做的一切。對賽萊默所做的事情來說,這項工作從未如此重要。正如我們致力於與世界各地的客戶和社區一起做的那樣,這家公司從未處於更好的位置來做出改變。我要再次感謝大家,並祝福您和您的家人一切順利。
Operator
Operator
Thank you. This concludes today's Xylem Third Quarter 2023 Earnings Conference Call. Please disconnect your line at this time, and have a wonderful day.
謝謝。今天的賽萊默 2023 年第三季財報電話會議到此結束。此時請斷開您的線路,祝您有美好的一天。