Greenbrier’s third quarter results were met with a negative market reaction, as the company’s revenue and earnings per share both fell short of Wall Street expectations. Management identified subdued demand for new railcars and a challenging macroeconomic environment as primary factors behind the performance. CEO Lorie Leeson emphasized the company’s focus on operational improvements, noting, “We achieved record financial results for 2025 on 2,000 fewer deliveries than in the prior year.”
Is now the time to buy GBX? Find out in our full research report (it’s free for active Edge members).
Greenbrier (GBX) Q3 CY2025 Highlights:
- Revenue: $759.5 million vs analyst estimates of $764.1 million (27.9% year-on-year decline, 0.6% miss)
- EPS (GAAP): $1.15 vs analyst expectations of $1.18 (2.3% miss)
- Adjusted EBITDA: $110.1 million vs analyst estimates of $105.2 million (14.5% margin, 4.6% beat)
- EPS (GAAP) guidance for the upcoming financial year 2026 is $4.25 at the midpoint, missing analyst estimates by 14.6%
- Operating Margin: 9.5%, down from 11.8% in the same quarter last year
- Sales Volumes fell 45.5% year on year (-71.2% in the same quarter last year)
- Market Capitalization: $1.30 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Greenbrier’s Q3 Earnings Call
- Ken Hoexter (Bank of America) asked about the outlook for railcar builds and whether European operations could offset softness in North America. EVP Brian Comstock indicated the company expects a low point in the current cycle but is seeing signs of recovery, especially in tank cars and restoration programs.
- Ken Hoexter (Bank of America) followed up on the impact of Mexico facility improvements and tariffs. CEO Lorie Leeson explained the in-sourcing project in Mexico had strengthened margins, while Comstock noted Greenbrier’s contracts and U.S. footprint provide some insulation from tariff volatility.
- Ken Hoexter (Bank of America) questioned the extent of European rationalization. Leeson clarified that the consolidation reduced overhead without affecting total capacity, and Comstock added that further rationalization opportunities remain, especially in North America.
- Bascome Majors (Susquehanna) probed the cadence of production, asking if the plan assumes back-end loaded deliveries. VP Justin Roberts confirmed expectations for higher output in the second half, driven by both backlog and anticipated customer orders.
- Bascome Majors (Susquehanna) asked about margin drivers beyond cost takeout. Roberts detailed that efficiency projects during the slower first half would support improved margins, while programmatic railcar restoration in new car facilities would enhance returns.
Catalysts in Upcoming Quarters
In the upcoming quarters, the StockStory team will be monitoring (1) the pace of order recovery and whether anticipated second-half production ramps materialize, (2) the success of European cost rationalization efforts and the impact on margins, and (3) continued growth and profitability in the Leasing & Fleet Management segment. Execution on these fronts will be critical to Greenbrier’s ability to navigate industry headwinds and maintain financial resilience.
Greenbrier currently trades at $41.84, down from $45.25 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free for active Edge members).
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