FreightCar America 2025 Q3 Earnings Strong Revenue Growth and Narrowed Losses

FreightCar America (RAIL) delivered a standout Q3 2025 performance, surpassing revenue and earnings expectations. The company reported a 41.7% year-over-year revenue increase to $160.51 million and narrowed its net loss by 93.6% to $0.23 per share. Management reaffirmed full-year adjusted EBITDA guidance while adjusting revenue forecasts downward to $500–$530 million due to a shift toward conversion railcars.

Revenue

FreightCar America’s Q3 revenue surged to $160.51 million, driven by robust manufacturing and operational efficiencies. The Manufacturing segment led with $153.96 million, reflecting strong demand for railcar deliveries and production at the Castaños, Mexico 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 leverage its flexible manufacturing model and capture market share in a competitive landscape.

Earnings/Net Income

The company significantly narrowed its net loss to $-7.45 million ($0.23 per share) in Q3 2025, a 93.6% improvement from the $-107.05 million ($3.57 per share) loss in the prior-year period. Adjusted EBITDA reached $17.0 million, with a 10.6% margin, reflecting enhanced operational efficiency and favorable product mix. The EPS improvement highlights the company’s progress in turning around its profitability.

Post-Earnings Price Action Review

Following the earnings release, FreightCar America’s stock experienced mixed short-term movements. The stock price dropped 5.76% during the latest trading day, while climbing 6.38% over the most recent full trading week. Month-to-date, shares declined 5.96%, reflecting investor caution despite the company’s strong financial results. Analysts remain cautiously optimistic, with a median 12-month target price of $14.33, indicating potential upside if operational momentum sustains.

CEO Commentary

CEO Nick Randall emphasized the company’s operational execution and strategic initiatives, including the TruTrack digital tracking system and plant layout enhancements. He highlighted a 15.1% gross margin and 10.6% adjusted EBITDA margin, both year-over-year improvements, as evidence of the Castaños facility’s efficiency. Randall expressed confidence in capturing pent-up demand as industry conditions normalize, with a focus on conversions and retrofits to drive profitability.

Guidance

FreightCar America reaffirmed full-year adjusted EBITDA guidance of $43–$49 million and railcar delivery guidance of 4,500–4,900 units. However, revenue guidance was adjusted to $500–$530 million, reflecting a higher proportion of conversion railcars with lower average selling prices. The company expects to maintain strong margins and close 2025 with positive cash generation.

Additional News

1. Tank Car Conversion Readiness: FreightCar America is well ahead of schedule for tank car retrofit programs, with readiness to transition to new tank car production post-retrofit.

2. Backlog Growth: The company reported a healthy backlog of 2,750 units valued at $222 million, positioning it to capitalize on 2026 demand.

3. Capital Expenditures: CapEx guidance shifted to $4–$5 million for 2025, with spending on tank car retrofit preparations delayed to early 2026.