Wabtec Reports Solid Fourth Quarter 2025 Earnings; Provides 2026 Full-Year Outlook

Wabtec Corporation, a global leader in technology solutions for the transportation industry, has reported impressive results for the fourth quarter of 2025. The company announced that its multi-year backlog has reached a record high of $27 billion, showing a significant 23% increase compared to the previous year. During the full year 2025, Wabtec achieved a GAAP earnings per share of $6.83, marking a 13% increase, and an adjusted earnings per share of $8.97, a substantial 19% improvement. This growth in adjusted earnings per share has been consistent over the past five years, averaging high-teens growth annually.

The company’s strong performance was highlighted by robust cash flow generation, with full-year cash from operations amounting to $1.8 billion, representing a cash conversion rate of 104%. Looking ahead to 2026, Wabtec has provided financial guidance forecasting adjusted earnings per share between $10.05 to $10.45, reflecting a 14% increase at the midpoint. In line with its commitment to returning value to shareholders, the Board of Directors has approved a 24% increase in the quarterly dividend and raised the share buyback authorization to $1.2 billion.

Rafael Santana, President and CEO of Wabtec, expressed satisfaction with the company’s performance, attributing it to the strong execution in challenging markets. He emphasized the positive momentum in the business and the value expected from recent acquisitions. With a record $27 billion multi-year backlog, Wabtec is well-positioned for sustained growth. Santana reaffirmed the company’s focus on innovation, operational excellence, and disciplined capital allocation to drive long-term value for shareholders.

In the fourth quarter of 2025, Wabtec recorded a 14.8% increase in sales compared to the same period the previous year. Sales growth was primarily driven by the Freight segment, including the positive impact of recent acquisitions like Inspection Technologies & Frauscher Sensor Technology. Operating margins, both GAAP and adjusted, showed improvement, supported by higher gross margins, despite increased operating expenses. The company, however, incurred restructuring costs associated with Integration 2.0 & 3.0, Portfolio Optimization charges, and transaction costs from acquisitions, impacting margins.

The Freight segment saw a significant uptick in sales during the fourth quarter, with equipment sales rising by 33.5% and digital sales soaring by 74.4% following the acquisition of Inspection Technologies & Frauscher Sensor Technology. Components sales also experienced growth, up by 11.1%. While services sales declined by 5.0%, it was in line with expectations due to the timing of modernization deliveries. Operating margins in the Freight segment were positively impacted by higher gross margins, although offset by increased operating expenses and one-time costs related to Portfolio Optimization and acquisitions.

In the Transit segment, sales increased by 6.7% in the fourth quarter driven by strong OE and aftermarket sales. However, operating margins were affected by manufacturing inefficiencies and higher operating expenses as a percent of revenue. Both segments contributed to the company’s robust backlog, with the 12-month backlog up by $553 million compared to the previous year and the multi-year backlog up by $5,135 million.

Wabtec’s strong financial performance was further evidenced by its cash flow and liquidity position. The company generated $992 million in cash from operations in the fourth quarter, a substantial increase from the year-ago period, driven by improved working capital efficiency. With a total available liquidity of $3.21 billion at the end of December 2025, Wabtec remains well-capitalized to support its growth initiatives. The company also prioritizes shareholder value through share repurchases and dividend increases, reflecting confidence in its long-term prospects.

Looking ahead, Wabtec’s 2026 financial guidance projects sales in the range of $12.19 billion to $12.49 billion and adjusted earnings per diluted share between $10.05 to $10.45. This guidance includes the impact of the recent acquisition of Dellner Couplers, which closed in February 2026. While not providing a quantitative reconciliation of GAAP earnings to adjusted earnings, Wabtec remains optimistic about its outlook and is poised for continued success in the transportation industry.