The acquisition of Evoqua Water Technologies Corp. was completed on May 24, 2023, for $6.9 billion. This acquisition expands Xylem's portfolio with advanced water and wastewater treatment capabilities and access to industrial markets.

Effective January 1, 2024, Xylem unified its Integrated Solutions and Services segment with the dewatering business from Water Infrastructure and assessment services from Measurement and Control Solutions to form a new segment called Water Solutions and Services. This is expected to improve operational efficiency.

Xylem anticipates total revenue growth in the range of 14% to 15% in 2024, with organic revenue growth anticipated to be in the range of 3% to 5%. The company expects organic revenue growth in the mid-single-digits in the Water Infrastructure segment, declines in the low-single-digits in the Applied Water segment, and growth in the low-double-digits in the Measurement and Control Solutions segment.

The integration of Evoqua is on track with the integration plan, and the company continues to strategically execute restructuring and realignment actions to optimize the cost structure and improve operational efficiency. The company expects to incur between $50 million and $70 million in restructuring and realignment costs during 2024.

Xylem is focused on building and enabling infrastructure for digital growth by making hardware, networks, and software applications interoperable and creating a common software experience. This will further strengthen core product offerings and deliver strategic, sustainable innovations and insightful data analytics.

Xylem continues to foster an empowering, mission-driven, diverse, equitable, and inclusive culture. The company will continue to build leadership succession depth and breadth and align incentives to drive 'one company' skills, mindset, and behaviors.

The company's global sales, supply chain, and operations are subject to risks including economic nationalism, populism, trade protection measures, instability from the evolving geopolitical environment, threat of terrorism, political instability, and potential for regional escalation.

The company may not be able to successfully compete for federally funded projects as some products may not comply with the domestic content requirements of the U.S. Buy America mandate under the Infrastructure Investment and Jobs Act (IIJA) or other federally funded projects.

The company's enterprise consists of businesses, functions, operations, manufacturing, and employees. The company relies on information technology, including operational technology, and communications networks to run manufacturing processes and equipment, to enable business processes, and to process, transmit, store and manage electronic information, including confidential business information and data relating to employees, customers or other business partners.

The company offers technologies, products, and services in highly competitive markets. The principal points of competition are product and service performance, quality and reliability, innovation, speed to market with new or disruptive technologies and business models, application expertise, brand reputation, energy efficiency, product security, product life cycle cost, timeliness of delivery, proximity of our service centers to customers, effectiveness of our distribution channels, price, and customers' experience in doing business with us.

The company faces an ever-expanding number of competitors, many of which are new and non-traditional from outside the industry, such as large technology firms, or those in the emerging markets.

Xylem seeks to enhance product and service offerings by adding innovative features, increased efficiency or disruptive or emerging technologies, such as artificial intelligence, that differentiate them from those of competitors and prevent commoditization.

The company's operating costs are subject to fluctuations, particularly due to volatility or changes in prices for commodities, parts, raw materials, energy and related utilities, freight and logistics, and the cost of labor. Price volatility and changes have been and may continue to be driven by a variety of factors, such as inflation, tight labor markets.

From time to time, the company has and may continue to initiate restructuring and realignment actions for various reasons, including to optimize the cost structure, improve operational efficiency and effectiveness, and enable the company to better serve customers, or in response to impacts from business and economic conditions.

Lack of or delay in availability of products, parts, raw materials and energy from the supply chain or the inability of suppliers to meet delivery and other requirements, could adversely affect the company's business.

R&D expense was $232 million, or 3.2% of revenue, in 2023 which was fairly consistent with the 2022 expense of $206 million, or 3.7% of revenue.

The company is focused on building and enabling infrastructure for digital growth by making hardware, networks and software applications interoperable and creating a common software experience.

A cybersecurity Incident or other damage or disruption to information technology and communications networks or involving connected products and services may have adverse effects on the company.

Xylem has a strong financial position and cash generation profile that enables it to fund strategic organic and inorganic growth initiatives, and consistently return capital to shareholders.

Dividends paid to shareholders increased 10% in 2023.

As of December 31, 2023, the net carrying value of goodwill and other indefinite-lived intangible assets totaled approximately $8 billion.

The strategic plan firmly embeds sustainability at the heart of the competitive advantage and unique business model, and aligns each of the five core strategic pillars to the overarching goal of integrating sustainability into everything the company does.

In 2021, Xylem announced a commitment to reach Net Zero greenhouse gas (“GHG”) emissions before 2050 across the value chain, further aligning the long-term commitment to sustainability with sector-wide moves towards reduced carbon footprint.

The efforts to research, establish, accomplish and accurately report on these commitments, goals, targets and other objectives expose the company to operational, reputational, financial, legal, and other risks.

Industry and economic conditions may adversely affect Xylem's markets and customers' operating conditions, which can in turn affect the company's business, results of operations and financial condition.

Weather conditions, including the effects of climate change as well as associated efforts by governmental or regulatory authorities to mitigate such effects, may cause volatility in the company's served markets and affect the company's businesses, operations and financial results.

The company's global operations are subject to various laws and regulations governing the environment and climate change, such as those promulgated by the U.S. Environmental Protection Agency and similar state and foreign environmental agencies, including related to the discharge of pollutants and the management and disposal of hazardous substances.