Westinghouse Air Brake Technologies Corporation (WAB) Earnings

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Dec 2026upcoming

Next quarter

Expected to report Feb 10, 2027 — estimated from last year’s reporting date.

Consensus is $2.67 EPS for Dec 2026 across 4 estimates, ranging $2.64 to $2.70.

WAB Sep 2026

Reported Oct 21, 2026 · before the open

: 4.04%

: $2.72
: $2.83
: —
: $3.12B

Reported results

: $3.12B; from $2.89B
: 37.31%; from 34.72%
: $625.00M; from $491.00M
: 20.03%; from 17.01%
: $409.00M; from $310.00M
: $2.42; from $1.81

Highlights

Adjusted EPS beat: Adjusted diluted EPS was $2.83, 4.0% above the $2.72 consensus and up 22.0% year over year; GAAP diluted EPS was $2.42, up 33.7%.
Margins expanded: Adjusted operating margin rose 1.9 percentage points to 22.9% year over year, while GAAP operating margin increased 3.0 points to 20.0%; management said expansion exceeded its expectations.
Revenue grew organically: Sales increased 8.1% to $3.12 billion year over year, including 4.7% organic growth and $114 million from acquisitions, partly offset by $5 million of foreign-exchange impact. Revenue was down from $3.18 billion in Q2.
Guidance increased: Wabtec raised and narrowed 2026 adjusted EPS guidance to $10.85–$11.05, lifting the midpoint by $0.20; revenue guidance remained $12.30–$12.60 billion.
Backlog reached a record: Total backlog was $31.44 billion at September 30, up 22.9% year over year and 1.6% sequentially. The 12-month backlog was $8.99 billion, up 8.8% year over year but down from $9.14 billion in June.
Both segments improved: Freight sales rose 6.9% to $2.24 billion and adjusted operating margin reached 26.4%; Transit sales climbed 11.3% to $883 million and adjusted margin rose to 18.1%.
Cash flow and returns: Operating cash flow was $455 million, up from $367 million a year earlier, with 82% cash conversion versus 83%. Wabtec repurchased $305 million of shares and paid $52 million in dividends.

Analysis

Wabtec’s third quarter combined a modest top-line beat in execution with a clearer earnings beat: adjusted EPS of $2.83 exceeded the $2.72 consensus by 4.0% and rose 22.0% year over year. Sales increased 8.1% to $3.12 billion, with organic growth of 4.7% and $114 million from acquisitions; however, revenue eased from $3.18 billion in Q2. GAAP operating income was $625 million, versus $600 million in Q2 and $491 million a year earlier, while shareholder net income rose to $409 million from $395 million sequentially and $310 million year over year. GAAP EPS was $2.42, up from $2.33 in Q2 and $1.81 a year ago.

The defining feature was stronger-than-expected margin expansion, attributed principally to operational execution, productivity, Integration 3.0, favorable mix, and cost control. Adjusted operating margin gained 1.9 points to 22.9%, while the $31.44 billion total backlog—up 22.9% year over year—provided visibility despite a slight sequential decline in 12-month backlog. Wabtec raised adjusted EPS guidance by $0.20 at the midpoint to $10.85–$11.05, while keeping revenue guidance unchanged at $12.30–$12.60 billion. Management also flagged locomotive deliveries shifted into Q4 and a weaker North American railcar-build outlook, but said the delivery timing did not change its full-year view.

Margin expansion

Consolidated profitability: GAAP gross margin increased 2.6 percentage points to 37.3%, and adjusted gross margin rose 1.8 points to 37.4%. GAAP operating margin reached 20.0%, up 3.0 points; adjusted operating margin rose 1.9 points to 22.9%.
Execution drove the upside: Management said margin expansion exceeded its expectations, led by operational excellence—plant productivity, lean and continuous-improvement work, and Integration 3.0—alongside favorable product mix and lower operating expenses as a share of revenue. Higher manufacturing costs and net tariffs were partial offsets.
GAAP-to-adjusted gap: Adjusted EPS of $2.83 compared with GAAP EPS of $2.42. The reconciliation included $0.39 per share for non-cash amortization and $0.02 for restructuring and portfolio-optimization costs.

Freight and Transit

Freight: Sales increased 6.9% to $2.237 billion; GAAP operating margin was 23.0%, up 3.2 points, and adjusted operating margin was 26.4%, up 1.9 points. Services sales rose 6.7%, Digital Intelligence 24.2% (including Frauscher and core digital demand), Components 5.3%, and Equipment 0.3%. Mining growth and lower locomotive deliveries partly offset one another in Equipment.
Transit: Sales rose 11.3% to $883 million, or 12.5% on a constant-currency basis, driven by Dellner Couplers and higher OEM and aftermarket demand. GAAP operating margin increased 1.9 points to 16.4%, while adjusted margin gained 2.6 points to 18.1%; improved gross margin more than offset higher operating expenses as a share of sales.
Organic growth and acquisitions: Consolidated organic sales increased 4.7%. Acquisitions added $114 million, including $49 million in Freight and $65 million in Transit; currency reduced sales by $5 million. Management said recent acquisitions were performing ahead of plan.

Backlog and orders

Visibility: Total backlog reached $31.435 billion, up 22.9% from a year ago and $503 million from June. The 12-month backlog was $8.992 billion, up 8.8% year over year but down $148 million sequentially. Management said order coverage for products with longer lead times was the strongest it had been.
New wins: Wabtec secured $1 billion of international locomotive and service orders, more than $600 million of North American locomotive and modernization orders for two Class I customers, and $159 million of transit brake-equipment orders during the quarter.
Long-term mix: Freight backlog was $25.765 billion and Transit backlog $5.670 billion. The filing reported $31.4 billion of remaining performance obligations, with approximately 30% expected to be recognized over the next 12 months.

2026 outlook

EPS guidance raised: The adjusted EPS range is now $10.85–$11.05, a $0.20 increase at the midpoint from the prior range and 22% growth at the midpoint versus 2025. Revenue guidance was maintained at $12.30–$12.60 billion, up 11.5% at the midpoint year over year.
Delivery timing and margins: Some locomotive deliveries shifted from Q3 into Q4, but management said the units had shipped and the timing did not affect full-year revenue guidance. It expects Q4 margin expansion to exceed Q3’s, citing product mix and a smaller year-over-year tariff headwind.
Market context: North American carload traffic rose 3.5% in Q3, but the 2026 railcar-build outlook was cut to about 23,000 cars, 26% below 2025. Management described fleet renewal as an opportunity not included in guidance and said industry forecasts point to railcar builds recovering toward 2025 levels in 2027.

Cash and capital

Cash generation: Operating cash flow was $455 million versus $367 million a year earlier; cash conversion was 82% versus 83%. Nine-month operating cash flow was $1.095 billion, compared with $767 million in 2025.
Liquidity and debt: Wabtec reported $2.09 billion of available liquidity, including $478 million of cash and $1.613 billion available under its revolving credit facility. Total debt was $6.38 billion, and management reported net debt leverage of 2.1 times.
Shareholder returns: The company repurchased $305 million of shares and paid $52 million in dividends during Q3. Approximately $456 million remained under the $1.2 billion repurchase authorization at September 30.

Westinghouse Air Brake Technologies Corporation

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