Westinghouse Air Brake Technologies (WAB) Q4 2025 earnings summary

Executive summary

• Achieved strong Q4 and full-year financial performance with 7.5%–17.5% sales growth and nearly 19% adjusted EPS growth, supported by robust execution, record backlog, and pipeline momentum.

• Advanced strategic priorities through acquisitions and integration, unlocking synergies and operational efficiencies.

• Board increased dividend by 24% and share buyback authorization to $1.2 billion, reflecting confidence in future performance.

• Delivered Q4 sales of $2.97 billion, up 14.8%–15%, and adjusted EPS up 25% year-over-year; cash flow from operations reached $992 million.

• Strong orders, backlog, and pipeline support a positive outlook for 2026 and beyond.

Financial highlights

• Q4 sales were $2.97 billion, up 14.8% year-over-year; full-year sales reached $11.17 billion, up 7.5%–17.5%.

• Q4 adjusted operating margin was 17.7%, up 0.8 pts; GAAP operating margin was 12.0%, down 0.9 pts due to restructuring and transaction costs.

• Q4 adjusted EPS was $2.10, up 25% year-over-year; full-year adjusted EPS was $8.97, up 18.7%.

• Full-year cash from operations was $1.76 billion, with cash conversion of 104%; Q4 operating cash flow was $992 million, 292% conversion.

• Year-end backlog: $8.2–$8.23 billion (12-month, up 7%+); $27.4 billion (multi-year, up 23%).

Outlook and guidance

• 2026 sales expected between $12.19–$12.5 billion, up 10.5% at midpoint; adjusted EPS guidance of $10.05–$10.45, representing 14% growth at midpoint.

• Guidance incorporates Dellner acquisition and expects continued strong cash conversion, though annual cash conversion guidance will no longer be provided.

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

• Strong pipeline and backlog provide clear visibility for profitable growth in 2026 and beyond.