Greenbrier (GBX) Q3 2026: Earnings Beat Expectations — Positive Outlook

Greenbrier Companies, Inc. (NYSE: GBX) reported its financial results for the third fiscal quarter ended May 31, 2026, showcasing a solid performance compared to the previous year. The company achieved net earnings of $19 million, or $0.60 per diluted share, marking an increase of $0.13 per share or +28% year-over-year from $0.47 in Q3 FY25.

Key Financial Metrics

• Revenue: $576.5 million, down from $842.0 million in Q3 FY25, representing a decrease of $265.5 million or -31.5% YoY.
• Net Earnings: $19 million, up from $15 million in Q3 FY25, an increase of $4 million or +26.7% YoY.
• Diluted EPS: $0.60, compared to $0.47 in Q3 FY25, an increase of $0.13 or +27.7% YoY.
• EBITDA: $69 million, up from $60 million in Q3 FY25, an increase of $9 million or +15% YoY.
• Aggregate Gross Margin: 14.1%, up from 11.8% in Q2 FY26, reflecting a sequential increase of 230 basis points.

This quarter's results indicate a positive trajectory for Greenbrier, particularly in terms of profitability, despite a significant drop in revenue compared to the previous year. The increase in net earnings and EPS suggests effective cost management and operational efficiency, which are crucial for shareholder value.

Shareholder Impact

For shareholders, this quarter can be viewed positively. The increase in net earnings and EPS demonstrates Greenbrier's ability to enhance profitability even in a challenging revenue environment. The company’s aggregate gross margin improvement to 14.1% indicates better manufacturing efficiency, which is a promising sign for future profitability. Furthermore, the board approved a quarterly dividend of $0.34 per share, marking the 49th consecutive quarterly dividend, which underscores the company’s commitment to returning value to shareholders.

Operational Highlights

• Owned Lease Fleet: Grew to 20,600 units, up 23% sequentially.
• Lease Fleet Utilization: Remained exceptionally strong at 99%.
• New Railcar Orders: 2,200 units valued at $340 million, contributing to a backlog of 13,800 units with an estimated value of $2.0 billion.
• Term Loan: Entered into a new, $425 million non-recourse term loan to support continued lease fleet growth.

These operational metrics reflect Greenbrier's strategic focus on expanding its leasing capabilities and maintaining high utilization rates, which are critical for generating recurring revenue.

Guidance Update

• Deliveries: Revised to 15,650 - 15,850 units from the previous range of 15,350 - 16,350 units.
• Aggregate Gross Margin %: Adjusted to 13.8% - 14.2% from 14.8% - 15.2%.
• Operating Margin %: Revised to 6.5% - 6.8% from 7.0% - 7.8%.
• EPS: Adjusted to $3.00 - $3.15 from $3.00 - $3.50.

The adjustments in guidance reflect a more cautious outlook on revenue and margins, likely due to market conditions and operational challenges. However, the company maintains its revenue target of $2.4 billion - $2.5 billion, indicating confidence in its overall business strategy.

Forward-Looking Catalysts

• Continued growth in the lease fleet and its impact on recurring revenue.
• The execution of new railcar orders and the management of the backlog.
• Updates on the company’s operational efficiency initiatives and cost management strategies.
• Any further developments regarding the freight railcar market and demand trends, particularly in North America.

In conclusion, Greenbrier's Q3 FY26 results reflect a strong operational performance despite revenue challenges. The company's focus on profitability, shareholder returns, and strategic growth initiatives positions it well for future success.

THE GREENBRIER COMPANIES, INC. Consolidated Statements of Income (In millions, except number of shares which are reflected in thousands and per share amounts, unaudited)

Note: All amounts are in thousands/millions.

	May 31, 2026	May 31, 2025
Revenue	$576.5	$842.3
Cost of revenue Manufacturing	$476.6	$672.5
Leasing & Fleet Management	$18.8	$18.6
Margin	$81.1	$151.2
Selling and administrative expense	$55.2	$65.9
Net gain on disposition of equipment	$(6.0)	$(7.0)
Earnings from operations	$31.9	$92.6
Interest and foreign exchange	$16.5	$13.2
Earnings before income tax and earnings from unconsolidated affiliates	$15.4	$79.4
Income tax expense	$(3.0)	$(18.6)
Earnings before earnings from unconsolidated affiliates	$12.4	$61.3
Earnings from unconsolidated affiliates	$5.1	$6.2
Net earnings	$17.5	$67.5
Net (loss) attributable to noncontrolling interest	$(1.4)	$(7.4)
Net earnings attributable to Greenbrier	$18.9	$60.1
Basic earnings per share	$0.61	$1.92
Diluted earnings per share	$0.60	$1.86
Weighted-average shares used to compute net income per share, basic	30,90	31,40
Weighted-average shares used to compute net income per share, diluted	31,70	32,20
Dividend per share	$0.34	$0.32

THE GREENBRIER COMPANIES, INC. Consolidated Balance Sheets (In millions, unaudited)

Note: All amounts are in thousands/millions.

	May 31, 2026	November 28, 2026	August 30, 2025	May 31, 2025
Assets
Cash and cash equivalents	$273.7	$521.8	$361.8	$306.1
Restricted cash	$49.1	$41.2	$13.6	$20.3
Accounts receivable, net	$463.4	$463.5	$509.2	$526.4
Income tax receivable	$18.0	$12.3	$18.5	$44.9
Inventories	$619.3	$621.1	$680.3	$688.3
Leased railcars for syndication	$426.7	$194.7	$178.8	$225.9
Equipment on operating lease, net	$1,298.4	$1,295.4	$1,330.9	$1,328.5
Property, plant and equipment, net	$708.5	$719.3	$719.1	$726.7
Investment in unconsolidated affiliates	$96.5	$90.8	$98.9	$99.3
Intangible and other assets, net	$264.7	$249.3	$254.7	$264.2
Goodwill	$129.9	$130.3	$129.8	$130.0
Total	$4,348.2	$4,339.7	$4,295.6	$4,360.6
Liabilities and Equity
Accounts payable and accrued liabilities	$574.2	$580.5	$577.5	$651.7
Debt, net	$733.3	$720.5	$794.8	$771.2
Non-recourse debt	$1,072.3	$1,042.2	$971.4	$979.7
Total	$1,805.6	$1,762.7	$1,766.2	$1,750.9
Deferred income taxes	$179.1	$174.8	$186.7	$180.2
Deferred revenue	$61.1	$68.6	$29.7	$44.3
Contingent redeemable noncontrolling interest	$31.9	$33.0	$34.5	$35.8
Total equity	$1,573.2	$1,564.6	$1,542.2	$1,532.5
Noncontrolling interest	$123.1	$155.5	$158.8	$165.2
Total equity	$1,696.3	$1,720.1	$1,701.0	$1,697.7
Total	$4,348.2	$4,339.7	$4,295.6	$4,360.6

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