FreightCar America 2025 Q3 Earnings Record EBITDA Amid Narrowed Losses

FreightCar America (RAIL) delivered its most profitable quarter since relocating operations to Mexico, surpassing earnings expectations with a $0.24 EPS and $160.5M revenue. The company narrowed its net loss by 93.6% year-over-year and reaffirmed adjusted EBITDA guidance despite lowering revenue forecasts due to a shift toward lower-ASP conversions.

Revenue

FreightCar America’s Q3 revenue surged 41.7% to $160.51 million, driven by robust manufacturing performance. The Manufacturing segment led with $153.96 million, reflecting strong railcar deliveries and operational efficiency gains at its Castaños facility. The Aftermarket segment contributed $6.55 million, while Corporate and Consolidated revenues totaled $0 and $160.51 million, respectively. This performance underscores the company’s ability to capitalize on custom solutions and a favorable product mix.

Earnings/Net Income

The company narrowed its net loss to $7.45 million ($0.23/share) in Q3 2025, a 93.0% improvement from $107.05 million ($3.57/share) in Q3 2024. Adjusted EBITDA reached a record $17.0 million ($0.24/share), marking a 56% year-over-year increase. This turnaround highlights the effectiveness of production efficiency and strategic cost management, positioning FreightCar for stronger profitability.

Post-Earnings Price Action Review

Following the earnings release, FreightCar America’s stock experienced mixed short-term performance. Shares fell 5.76% on the latest trading day but gained 6.38% over the preceding week, reflecting investor uncertainty amid positive fundamentals. Month-to-date, the stock declined 5.96%, indicating cautious market sentiment despite the company’s improved margins and record EBITDA. Analysts remain optimistic about long-term prospects, though near-term volatility persists due to guidance adjustments and industry-wide demand fluctuations.

CEO Commentary

CEO Nicholas Randall highlighted the company’s 42% revenue growth, 15.1% gross margins, and $17 million adjusted EBITDA as key achievements. He emphasized strategic initiatives like TruTrack digital integration, vertical integration, and automation readiness for tank car conversions. Despite industry challenges, Randall expressed confidence in capturing pent-up demand and leveraging a $222 million backlog to drive 2026 growth.

Guidance

FreightCar America reaffirmed full-year adjusted EBITDA and delivery guidance but lowered 2025 revenue projections to $500–$530 million due to a higher proportion of lower-ASP conversions. Capital expenditures are now projected at $4–$5 million for 2025, with timing shifts into 2026 for tank car retrofit readiness. The company expects positive free cash flow and solid profitability in 2025, aligning with normalized replacement cycle demand in 2026.

Additional News

Recent developments highlight FreightCar America’s strategic momentum. The company’s 20% market share in new railcar orders underscores its competitive position, supported by a healthy $222 million backlog and $62.7 million cash reserves. Management remains focused on tank car conversion readiness, with production expected to begin in 2026. Analysts note the stock’s 35% upside potential from current levels, though risks like macroeconomic pressures and margin compression in Q4 persist. Institutional ownership at 40.17% reflects confidence in the company’s long-term growth trajectory.