Westinghouse Air Brake Technologies (WAB) Q3 2025 earnings summary

Executive summary

• Q3 2025 sales reached $2.89B, up 8.4% year-over-year, with strong contributions from both Freight and Transit segments and the Inspection Technologies acquisition.

• Adjusted EPS rose 16% to $2.32, and GAAP EPS increased 11% to $1.81.

• Multi-year backlog reached $25.6B, with the 12-month backlog up 8.4% to $8.3B, providing robust revenue visibility.

• Major acquisitions completed or announced include Inspection Technologies, Frauscher, and Dellner Couplers, expanding digital and inspection capabilities.

• Largest locomotive order in company history signed with Kazakhstan Temir Zholy, valued at $4.2B.

Financial highlights

• Gross profit for Q3 2025 was $1.00B (GAAP), with gross margin improving to 34.7% (up 1.7 pts); adjusted gross margin was 35.6%.

• GAAP operating income was $491M; adjusted operating margin was 21.0%, up 1.3 pts.

• Q3 net income attributable to shareholders was $310M; diluted EPS was $1.81.

• Operating cash flow for Q3 was $367M; year-to-date cash from operations was $767M.

• EBITDA for Q3 2025 was $617M; adjusted EBITDA was $658M.

Outlook and guidance

• 2025 adjusted EPS guidance raised to $8.85–$9.05, up 18.4% at the midpoint; revenue expected between $10.925B and $11.225B.

• Operating cash flow conversion for 2025 expected to exceed 90%.

• Five-year outlook targets mid-single-digit organic sales CAGR, 350+ bps adjusted operating margin expansion, double-digit adjusted EPS CAGR, and >90% cash conversion.

• Backlog provides visibility for profitable growth into 2026.

• Ongoing restructuring and integration initiatives are anticipated to yield further cost savings.