GREENBRIER COMPANIES INC has recently released its latest 10-Q report. The company designs, manufactures, and markets railroad freight car equipment across North America, Europe, and South America, and it also leases railcars and provides fleet management services. Its operations are organized into two segments: Manufacturing and Leasing & Fleet Management, with the leasing side covering a fleet of about 16,800 railcars as of February 28, 2026.
In Item 2, management said the business is operating amid inflation, trade tensions, tariff risk, foreign exchange volatility, higher interest rates, and geopolitical instability. The company said a weaker economy or continued supply chain disruption could raise raw material, labor, and manufacturing costs and also reduce railcar orders and leasing activity. Even so, management said it is focused on a multi-year plan centered on more recurring revenue, higher gross margin, and better return on invested capital.
Backlog stood at 15,200 railcar units with an estimated value of $2.1 billion as of February 28, 2026, with deliveries extending into 2027 and beyond. About $650 million of that backlog was tied to railcars intended for syndication, and roughly 13% of backlog units and 12% of backlog value were associated with Brazilian manufacturing operations accounted for under the equity method.
For the three months ended February 28, 2026, revenue fell 22.9% to $587.5 million from $762.1 million a year earlier. Cost of revenue declined 16.9% to $518.0 million, but margin still dropped to 11.8% from 18.2%. Net earnings attributable to Greenbrier fell 71.1% to $15.0 million, or $0.47 per diluted share, from $51.9 million, or $1.56 per diluted share.
Manufacturing was the main source of the decline. Revenue in that segment dropped 24.0% to $541.5 million from $712.9 million, while deliveries fell 32.0% to 3,400 railcars from 5,000. Manufacturing earnings from operations slid to $20.7 million from $80.8 million, and segment margin compressed to 7.6% from 15.0%.
Leasing & Fleet Management was steadier. Revenue slipped 6.5% to $46.0 million from $49.2 million, but earnings from operations edged up to $35.5 million from $34.6 million. The company said the segment’s revenue decline was mainly due to a $2.0 million drop in interim rent on leased railcars for syndication, while earnings benefited from a $3.4 million increase in net gain on disposition of equipment.
Selling and administrative expense declined 11.1% to $57.4 million from $64.6 million, mainly because of lower employee-related costs. Net gain on disposition of equipment rose to $13.0 million from $9.6 million. Interest and foreign exchange expense fell to $13.7 million from $21.7 million, helped by changes in the Mexican peso and Brazilian real versus the U.S. dollar and higher interest income.
Income tax expense dropped to $1.7 million from $20.0 million, and the effective tax rate fell to 14.9% from 32.3%. Today the company's shares have moved -0.78% to a price of $52.08. Check out the company's full 10-Q submission here.
