Clean Harbors (CLH) Financials

Clean Harbors (NYSE: CLH) showed solid top-line growth in Q1 2026, but profitability and cash generation weakened sharply versus the recent run-rate. Revenue rose to $1.46 billion, up from $1.43 billion in Q1 2025, but net income fell to $63.2 million from $58.7 million a year ago while operating cash flow collapsed to just $6.3 million from $1.6 million in Q1 2025 and $18.5 million in Q1 2024. That suggests the business is still growing, but working capital pressure and heavier spending are absorbing cash.

Profitability remained respectable, but margins were mixed. Q1 2026 gross profit was $445.4 million, slightly above Q1 2025’s $410.1 million, and operating income improved to $118.9 million from $111.6 million. However, operating margin was pressured by a big jump in SG&A and depreciation, and pretax income slipped to $84.4 million from $74.6 million in Q1 2025 only because the prior quarter mix was different. Compared with Q4 2025, Q1 2026 was weaker on revenue, gross profit, operating income, and EPS.

Over the last four years, Clean Harbors has expanded meaningfully, but the trend is not perfectly linear. Revenue has generally climbed from the 2023 level into the 2025–2026 range, while quarterly net income has also risen over time. At the same time, the company has leaned heavily on acquisitions and capital spending, which has increased balance-sheet complexity and made quarterly cash flow more volatile.

Balance-sheet leverage looks manageable, but debt remains substantial. At March 31, 2026, Clean Harbors had $547.99 million in cash and equivalents and $121.04 million in short-term investments, versus $12.6 million of short-term debt and $2.76 billion of long-term debt. Total equity was $2.78 billion and total liabilities were $4.78 billion. That is not an alarming liquidity profile, but the company is still carrying a meaningful debt load that investors should watch.

Cash flow was the biggest concern in Q1 2026. Operating cash flow of $6.3 million was far below net income because changes in operating assets and liabilities were a large drag of $186.7 million. Clean Harbors also spent $98.4 million on capex and $132.0 million on acquisitions, leaving net cash flow deeply negative for the quarter. This is a reminder that accounting earnings are not always translating into cash right now.

• Revenue grew year over year to $1.46 billion in Q1 2026 from $1.43 billion in Q1 2025.
• Gross profit improved to $445.4 million, showing the business is still generating healthy spread over costs.
• Operating income increased to $118.9 million, suggesting core operations remained profitable.
• Net income remained positive at $63.2 million, despite higher depreciation and a weaker cash profile.
• Cash and investments remained sizable at about $669 million combined, supporting near-term liquidity.
• Shares outstanding were relatively stable versus prior periods, with only modest dilution in the quarter.
• Q1 2026 was weaker than Q4 2025 on revenue, operating income, and EPS, so seasonality or execution timing may be in play.
• Acquisition activity remains a major part of the story, with $132.0 million spent in Q1 2026 and meaningful M&A spending in prior years.
• Operating cash flow was nearly flat at $6.3 million, despite $63.2 million of net income.
• Working capital used a large amount of cash, which can pressure future flexibility if it persists.

Bottom line: Clean Harbors continues to look like a profitable, growing industrial services company, but Q1 2026 highlighted a clear cash conversion problem. If management can reverse the working-capital drag and keep integrating acquisitions effectively, the long-term setup still looks constructive. If not, the debt load and heavy capital needs could limit upside and keep the stock more volatile.