Westinghouse Air Brake Technologies (WAB) Q3 2026 Earnings Report
MX:WAB Q3 2026 EPS Results
- Actual EPS
- MXN 53.16
- Consensus EPS
- MXN 51.34
- Beat/Miss
- Beat by +MXN 1.82
- One Year Ago EPS
- MXN 43.58
MX:WAB Q3 2026 Revenue Results
- Actual Revenue
- MXN 58.61B
- Expected Revenue
- MXN 60.09B
- Beat/Miss
- Missed by -MXN 1.47B
- YoY Revenue Growth
- +8.11%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/21/2026
- Time
- Before Open
- Conference Call
- Wednesday, October 21, 2026
Westinghouse Air Brake Technologies's next earnings date is estimated for February 17, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was strongly positive. Wabtec reported broad-based sales, earnings, margin, backlog, cash-flow, and segment growth; raised adjusted EPS guidance; cited strong order coverage, business wins, acquisition performance, and multiple long-term growth opportunities. The main challenges were the decline in North American railcar builds, mixed freight-market conditions, tariff and currency headwinds, lower locomotive deliveries caused by timing, and higher acquisition-related expenses, but management characterized these issues as manageable and maintained a confident outlook.
For 2026, Wabtec raised full year adjusted EPS guidance to the range of $10.85-$11.05, up 22% at the midpoint, while revenue guidance remains unchanged; year-to-date organic growth sits at 5.2%, and the company expects that organic growth will be above 5%. Fourth-quarter margin expansion is expected to be a fair amount higher than the third quarter, with “oversize margin” and $0.20 higher overall EPS. The 2026 North America railcar build forecast is approximately 23,000 cars, a 26% reduction from last year's car build, while industry forecast for 2027 is to be going up back to really 2025 numbers, still well below here the replacement ratio. For the longer term, the company expects margin growth certainly in 2027, with a 350-plus basis points framework, about two-thirds from the cost side and the other third from delivering innovative products.
- Strong Third-Quarter Financial PerformanceThird-quarter sales were $3.12 billion, up 8.1% year over year and up 8.3% excluding currency. GAAP operating income increased 27.3% to $625 million, GAAP earnings per diluted share rose 33.7% to $2.42, and adjusted EPS increased 22.0% to $2.83.
- Operating Margin ExpansionGAAP gross margin increased 2.6 percentage points to 37.3%, GAAP operating margin increased 3.0 percentage points to 20.0%, and adjusted operating margin improved 1.9 percentage points to 22.9%. Performance was supported by favorable product mix, operational execution, Integration 3.0 productivity benefits, efficiency initiatives, and disciplined cost management.
- Raised Full-Year Adjusted EPS GuidanceFollowing third-quarter results ahead of expectations, Wabtec raised full-year 2026 adjusted EPS guidance to $10.85-$11.05, representing a 22% increase at the midpoint. Full-year revenue guidance remained unchanged.
- Backlog Growth and Record CoverageTwelve-month backlog increased 8.8% year over year, while multi-year backlog exceeded $31 billion, up 22.9%. Freight multi-year backlog was $25.77 billion, up 23.2%, and Transit multi-year backlog increased 21.4%. Management said order coverage was the strongest it has ever been, including 24-36 months of coverage for long-lead products such as new locomotives.
- Strong Freight Segment ResultsFreight sales increased 6.9%. GAAP Freight operating income was $515 million, with a 23.0% operating margin, up 3.2 percentage points year over year. Adjusted Freight operating income increased 15.2% to $591 million, and adjusted operating margin rose 1.9 percentage points to 26.4%.
- Transit Segment GrowthTransit sales increased 11.3% to $883 million, or 12.5% excluding foreign currency. Adjusted Transit operating income was $160 million, and adjusted operating margin increased 2.6 percentage points to 18.1%, supported by underlying business momentum and the Dellner acquisition.
- Digital Intelligence and Services GrowthDigital Intelligence sales increased 24.2%, driven by the Frauscher Sensor Technologies acquisition and strong core digital demand. Services revenue increased 6.7%, supported by strong core services sales growth and higher modernization deliveries.
- Successful Business WinsWabtec secured $1 billion of international locomotive and service orders, including significant awards in Africa and Brazil. In North America, it converted more than $600 million of pipeline opportunities into locomotive and modernization orders for two Class I customers. Transit brake equipment orders totaled $159 million.
- Healthy North American Rail DemandNorth American carload traffic increased 3.5% during the quarter, and Wabtec's and the industry's active locomotive fleet was higher than in the third quarter of the prior year. Management said it has not seen a change in customer buying behavior and views North American fleet renewal as a growth opportunity not included in current guidance.
- International and Transit Pipeline StrengthManagement described international demand as strong and said infrastructure investments are driving the international orders pipeline. Opportunities were cited across Africa, Central Asia, Asia, Brazil, South America, Europe, and India. Transit ridership trends remained favorable in key markets, including Europe and India, while public investment supported fleet expansion and renewal programs.
- Operational Excellence and Cost ProgramsIntegration 3.0 savings were coming in higher than expected, with lower costs to deliver those savings than in Integration 2.0. Portfolio optimization has involved shedding assets that add complexity without delivering expected profits, with activity ranging between $50 million and $100 million per year. Management said additional opportunity remains in both programs.
- Strong Cash Flow and Financial PositionThird-quarter operating cash flow was $455 million, with cash conversion of 82%. Liquidity ended the quarter above $2 billion, and net debt leverage was 2.1 times. During the quarter, Wabtec repurchased $305 million of shares and paid $52 million in dividends.
- Organic Growth and Acquisition ExecutionYear-to-date organic growth was 5.2%, and management expects organic growth to be above 5%. Recent acquisitions were described as performing ahead of plan or very well, including Dellner and Frauscher Sensor Technologies.
- Continued Technology InvestmentWabtec continues to invest in engineering, automation, fuel efficiency, labor productivity, capacity utilization, reliability, safety, and life-cycle cost improvements. Engineering expense was $67 million, $8 million higher than the prior-year quarter, reflecting investment in current opportunities and future industrial technology capabilities.
- Long-Term Growth OpportunitiesManagement cited opportunities from aging fleets, fleet modernization, electronics obsolescence, efficiency and safety upgrades, international infrastructure investment, and potential inorganic opportunities. The company also said Zero-to-Zero continues to progress and that it is expecting FRA approval.
- Expected Fourth-Quarter MomentumManagement expects fourth-quarter revenue to be higher than previously expected because locomotive units shifted from the third quarter into the fourth quarter and have already shipped. It also expects fourth-quarter margin expansion to be higher than in the third quarter and projected approximately $0.20 of additional overall EPS.
MX:WAB Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 17, 2027 | 2026 (Q4) | 50.18- | 39.45 | ― | ― |
| Oct 21, 2026 | 2026 (Q3) | 51.3453.16 | 43.58 | 21.98% (+9.58) | |
| Jul 22, 2026 | 2026 (Q2) | 48.9451.85 | 42.64 | 21.59% (+9.21) | |
| Apr 22, 2026 | 2026 (Q1) | 47.1750.91 | 42.83 | 18.86% (+8.08) | |
| Feb 11, 2026 | 2025 (Q4) | 39.1139.45 | 31.56 | 25.00% (+7.89) | |
| Oct 22, 2025 | 2025 (Q3) | 42.7443.58 | 37.57 | 16.00% (+6.01) | |
| Jul 24, 2025 | 2025 (Q2) | 41.0142.64 | 36.82 | 15.82% (+5.82) | |
| Apr 23, 2025 | 2025 (Q1) | 38.0642.83 | 35.51 | 20.63% (+7.33) | |
| Feb 12, 2025 | 2024 (Q4) | 32.4831.56 | 28.93 | 9.09% (+2.63) | |
| Oct 23, 2024 | 2024 (Q3) | 35.3737.57 | 31.94 | 17.65% (+5.64) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.