Wabtec (WAB) official guidance

As we look at the fourth quarter, in light of our third quarter results and our ongoing underlying momentum, we are raising our full year adjusted EPS guidance. We now expect adjusted EPS to be in the range of $10.85-$11.05, up 22% at the midpoint.

As we flip forward, Ken, to the fourth quarter, we have talked about this as we expect the fourth quarter to be a fair amount higher in margin expansion than the third quarter.

We're continuing to accelerate organic revenues in 2026, and that's true for both freight and transit. Year to date, organic growth sits at 5.2%. The execution's strong in the business. We're building momentum, and we expect that organic growth will be above 5%.

Looking at the North America railcar builds, last quarter, we discussed the industry outlook for 2026, which was approximately 25,000 cars to be delivered and which now has been reduced by industry sources to approximately 23,000 cars.

For the full year 2026, Wabtec continues to expect revenues to be between $12.30 billion to $12.60 billion, up 11.5% at the midpoint versus prior year.

Looking ahead, we expect modernization deliveries to grow in the H2 of the year, returning services to growth in the back half.

We also expect the majority of our margin expansion for the year to occur in the back half of the year.

Consequently, as modernization deliveries ramp up in the H2, we would expect equipment revenue growth to remain positive, but at a very moderate pace versus the 43% growth achieved in the H1.

That said, we continue to expect full-year services revenue to be down due to the lower number of modernization deliveries that were shipped in the H1 when we compare that to the prior year.

For the H2, we expect year-over-year revenue growth to temper as we lap the inclusion of Inspection Technologies in the prior year period.

When we look at the cadence of growth between the third and the Q4s, we expect revenue growth to be slightly higher in the Q3 versus the fourth.

Our expectations for the full year remain at approximately 24.5%.

Overall, we've talked about we expect to combine mods and locals on a worldwide basis to be up, and versus in North America, we would expect the combined mods and locals to be down a little bit on a full year basis.

Overall, we've talked about we expect to combine mods and locals on a worldwide basis to be up, and versus in North America, we would expect the combined mods and locals to be down a little bit on a full year basis.

In Q2, we expect to post another quarter of strong equipment growth and lower year-over-year services revenues, driven by lower modernization deliveries.

Tami, the only thing I would add here is on modernizations, and we've made that comment before, that's down. It's down significantly. It's down double digit, and it's largely driven by the North American market.

In Q2, we expect to post another quarter of strong equipment growth and lower year-over-year services revenues, driven by lower modernization deliveries.

We now anticipate $115-$140 million of run rate savings by the end of 2028, with anticipated expenses of $125-$155 million.

During 2025, we exited $72 million of low-margin non-strategic revenue and expect to exit an additional $60 million in 2026.

We now anticipate $115-$140 million of run rate savings by the end of 2028, with anticipated expenses of $125-$155 million.