Westinghouse's Q4 2024: Dissecting Contradictions in Pricing Power, Revenue Growth, and Margin Expectations

These are the key contradictions discussed in Westinghouse Air Brake Technologies Corporation's latest 2024Q4 earnings call, specifically including: Pricing and Margin Expectations, Revenue Growth and Backlog, and the Impact of Tariffs and Inflation on COGS:



Revenue and Profit Growth:
- Wabtec reported sales of $2.6 billion in Q4 2024, representing a 2% increase over the previous year. Adjusted earnings per share were up 9% from the year-ago quarter.
- This growth was driven by strong international market activity, particularly in core markets like Latin America, Africa, Asia, and CIS, as well as increased infrastructure investments supporting robust locomotive orders.

Digital Intelligence Expansion:
- The Digital Intelligence business signed significant orders totaling approximately $1 billion in 2024, marking the strongest year for orders since 2019.
- The growth was attributed to strong demand for advanced automation train handling solutions and digital mining technologies, despite softer demand in North America.

Transit Sector Momentum:
- Transit segment sales were up 7.1% at $789 million, with foreign currency adjusted sales increasing by 7.5%.
- This growth was driven by increasing ridership levels in key geographies and fleet expansions and renewals.

Order Backlog and Pipeline:
- Wabtec's twelve-month backlog reached $7.7 billion, demonstrating consistent momentum and visibility across the businesses despite macroeconomic volatility.
- The strong backlog is attributed to high levels of recurring revenues and a robust pipeline of international orders, especially in mining and agricultural markets.