What changed in this filing

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Item 1A. Risk Factors

2026-02-13 compared with 2025-02-12 · 33 added, 25 removed, 273 unchanged (18% of the section changed)

27 unchanged sentences

There may be additional innovations impacting the railway industry that we cannot yet foresee.

The advancement of artificial intelligence technologies may significantly accelerate the pace and broaden the scope of technological innovation impacting the industry.

Any failure by us to quickly adapt to and adopt new innovations in products and processes desired by our customers may result in a significant loss of demand for our product and service offerings.

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Instability in the global economy, negative conditions in the global credit markets, volatility in the industries that our products serve, changes in legislative policy, adverse changes in the financial condition of our customers, adverse changes in the availability of raw materials and supplies, or un-remedied contract breaches could possibly lead to contract termination or cancellations of orders in our backlog or request for deferred deliveries of our backlog orders, each of which could adversely affect our cash flows and results of operations.

For example, although the

economic slowdown caused by the COVID-19 pandemic did not result in any material cancellations of the Company's backlog, it did impact the timing of some orders in backlog as, in certain cases, the delivery of goods and services were pushed out from their original timelines.

For example, although the economic slowdown caused by the COVID-19 pandemic did not result in any material cancellations of the Company's backlog, it did impact the timing of some orders in backlog as, in certain cases, the delivery of goods and services were pushed out from their original timelines.

Equipment failures, interruptions, delays in deliveries or extensive damage to our facilities, supply chains, distribution systems or information technology systems, could adversely affect our business.

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and Europe, and labor availability constraints that resulted in component, raw material and chip shortages.

Additionally, market factors, such as broad-based inflation, escalation of commodities costs, transportation and logistics costs, labor costs, and foreign currency exchange rate fluctuations may exacerbate the impacts of such disruptions.

Additionally, in an environment of heightened global geopolitical uncertainty, market factors, such as broad-based inflation, escalation of commodities costs, transportation and logistics costs, tariffs, labor costs, and volatility in foreign currency exchange rates may exacerbate the impacts of supply chain disruptions.

There can be no assurance that supply chain disruptions will not occur from time to time, or that the steps we take to mitigate such disruptions will be effective or achieve their desired results in a timely fashion.

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• unanticipated changes in the market conditions, business and economic factors affecting such an acquisition, joint venture or alliance.

As a result of our acquisitions from time to time, we have goodwill recorded on our balance sheet.

Goodwill is tested for impairment annually or more often if events or changes in circumstances indicate a potential impairment may exist.

Factors that could indicate that our goodwill could be impaired include a decline in our stock price and market capitalization, lower than projected operating results and cash flows, and slower growth rates in our industry.

If we determine at a future time that impairment exists, it may result in a significant non-cash charge to earnings and lower stockholders' equity.

In addition, we may fail to consummate future acquisitions, joint ventures or other business combinations for a variety of reasons, including the failure to satisfy closing conditions, potential regulatory interventions, or the possibility of competing bidders presenting a superior offer.

1 unchanged sentence

In addition, our ability to engage in such strategic transactions will be dependent on our ability to raise substantial capital, and we may not be able to raise the funds necessary to implement this strategy on terms satisfactory to us, if at all.

Further, we regularly implement organization changes and streamlining, such as divestitures and realignments, to support our growth and cost management strategies and to encourage efficiencies.

If we are unable to successfully manage these and other organizational changes, the ability to complete such activities and realize anticipated benefits and cost savings as well as our results of operations and financial condition could be materially adversely affected.

The integration of our recently completed acquisitions may not result in anticipated improvements in market position or the realization of anticipated operating synergies or may take longer to realize than expected.

Although we believe that our recent acquisitions will improve our market position and realize positive operating results, including operating synergies, operating expense reductions and overhead cost savings, we cannot be assured that these

improvements will be obtained or the timing of such improvements.

The management and acquisition of businesses involves substantial risks, any of which may result in a material adverse effect on our business and results of operations, including:

2 unchanged sentences

• diversion of management’s attention from business operations to integration matters;

• reliance on transition services agreements;

• departure of key personnel from the acquired business;

11 unchanged sentences

A significant portion of our sales may be derived from our international operations, which exposes us to certain risks inherent in doing business on an international level.

For the fiscal year ended December 31, 2024, approximately 53% of our consolidated net sales were to customers outside of the United States.

For the fiscal year ended December 31, 2025, approximately half of our consolidated net sales were to customers outside of the United States.

We intend to continue to expand our international operations, including in emerging markets, in the future.

Our global headquarters for the Transit group is located in France, and we conduct other international operations through a variety of wholly and majority-owned subsidiaries and joint ventures, including in Australia, Austria, Brazil, Canada, China, Czech Republic, France, Germany, India, Italy, Kazakhstan/Commonwealth of Independent States ("CIS"), the Republic of North Macedonia, Mexico, the Netherlands, Poland, Spain, South Africa, Turkey, and the United Kingdom.

As a result, we are subject to various risks, any one of which could have a material adverse effect on those operations and on our business as a whole, including:

3 unchanged sentences

• restrictions on currency conversion or the transfer of funds or limitations on our ability to repatriate income or capital;

• the complexities of operating within multiple tax jurisdictions;

• the complexities of operating within multiple tax jurisdictions and potentially material impacts associated with changes in applicable tax laws;

• foreign trade restrictions and exchange controls;

11 unchanged sentences

In the ordinary course of business, we are exposed to increases in interest rates that may adversely affect funding costs associated with variable-rate debt and changes in foreign currency exchange rates.

We are subject to currency exchange rate

risk to the extent that our costs may be denominated in currencies other than those in which we earn and report revenues and vice versa.

We are subject to currency exchange rate risk to the extent that our costs may be denominated in currencies other than those in which we earn and report revenues and vice versa.

In addition, a decrease in the value of any of these currencies relative to the U.S.

8 unchanged sentences

We have substantial operations located in emerging markets, such as Brazil, India, and Kazakhstan.

Operations in such emerging markets are inherently risky due to a number of regulatory, economic, social and political uncertainties.

Operations in such emerging markets are inherently risky due to a number of regulatory, economic, social and political uncertainties, which may be exacerbated in environments of heightened geopolitical uncertainty and volatility.

These risks include economies that may be dependent on only a few products and are therefore subject to significant fluctuations, weak legal systems which may affect our ability to enforce contractual rights, possible exchange controls, unstable governments, nationalization or privatization actions or other government actions affecting the flow of goods and currency.

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We also do business with industry suppliers located in various international markets.

A protectionist trade environment in either the United States or those foreign countries in which we do business, such as a change in the current tariff structures, export compliance or other trade policies, may adversely affect our business.

A protectionist trade environment in either the United States or those foreign countries in which we do

business, such as a change in the current tariff structures, export compliance or other trade policies, may adversely affect our business.

In particular, such policies may impact or delay our customers' investments in our products, reduce the competitiveness of our products in certain markets, and inhibit our ability to cost-effectively purchase necessary inputs from certain suppliers.

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We are subject to a variety of environmental laws and regulations.

We are subject to a variety of increasingly stringent environmental laws and regulations governing air emissions, discharges into water, chemical substances in products, the use, handling, storage, and disposal of hazardous substances or waste materials, as well as the remediation of contamination associated with releases of hazardous substances.

We have incurred, and will continue to incur, both operating and capital costs to comply with environmental laws and regulations,

including costs associated with the clean-up and investigation of some of our current and former properties and offsite disposal locations.

We are subject to a variety of stringent environmental laws and regulations governing air emissions, discharges into water, chemical substances in products, the use, handling, storage, and disposal of hazardous substances or waste materials, as well as the remediation of contamination associated with releases of hazardous substances.

We have incurred, and will continue to incur, both operating and capital costs to comply with environmental laws and regulations, including costs associated with the clean-up and investigation of some of our current and former properties and offsite disposal locations.

We believe our operations currently comply in all material respects with all of the various environmental laws and regulations applicable to our business;

8 unchanged sentences

Potential regulation addressing climate change may affect the Company's operations and products in certain jurisdictions.

The potential challenges posed by evolving climate change policy and prospective regulation are heavily dependent on the nature and degree of such legislation, the consistency (or lack of consistency) of legislation across jurisdictions in which we operate, and the extent to which such regulation and legislation applies to our industry.

The potential challenges posed by evolving climate change policy and prospective regulation are heavily dependent on the

nature and degree of such legislation, the consistency (or lack of consistency) of legislation across jurisdictions in which we operate, and the extent to which such regulation and legislation applies to our industry.

Although uncertain, these developments could increase costs or reduce the demand for the products the company sells.

47 unchanged sentences

Accordingly, our business may be adversely impacted by disruptions to our own or third-party information technology infrastructure, which could result from cybersecurity incidents, including, but not limited to, unauthorized access to the Company’s information technology systems, data access or acquisition, and/or encryption of the Company’s environment.

For instance, we have experienced cyber-security incidents that have impacted the Company's network.

The security and functionality of our information technology systems, and the process of data by these systems, are critical to our business operations.

If these systems are damaged, intruded upon, attacked, shutdown, or cease to function properly, and we suffer any resulting interruption in our ability to manage and operate our business, or if our products are affected, our results of operations and financial condition could be materially adversely affected.

We have experienced cyber-security incidents that have impacted the Company's network.

We have also been indirectly affected by vulnerabilities in third-party systems used for certain Wabtec products.

1 unchanged sentence

Such incidents have not had a material impact on our business, operations or financial results.

However, a successful exploitation of our own or our vendors’ information technology infrastructure could result in service interruptions, safety hazards, misappropriation of confidential information, process failures, security breaches or other operational difficulties.

Such an event could result in

decreased revenues and increased capital, insurance or operating costs, including the increased costs of security to protect the Company’s infrastructure, among other results.

However, a successful exploitation of our own, our vendors’ or our customers' information technology infrastructure could result in service interruptions, safety hazards, misappropriation of confidential information, process failures, security breaches or other operational difficulties.

Such an event could result in decreased revenues and increased capital, insurance or operating costs, including the increased costs of security to protect the Company’s infrastructure, among other results.

Insurance maintained by the Company to protect against loss of business and other related consequences resulting from cyber incidents may not be sufficient to cover all damages.

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Furthermore, non-union employees in certain countries have the right to strike.

If we were to experience a strike or work stoppage, it could be difficult for us to find a sufficient number of employees with the necessary skills to replace these employees.

If we were to experience a strike or work stoppage, it could be difficult for us to find a

sufficient number of employees with the necessary skills to replace these employees.

We cannot assure that we will reach any such agreement or that we will not encounter strikes or other types of conflicts with the labor unions of our personnel.

9 unchanged sentences

Our indebtedness could adversely affect our financial health.

At December 31, 2024, we had total debt of $4.0 billion, primarily related to Senior Notes, and the 2022 and 2024 Credit Agreements ("Credit Agreements").

At December 31, 2025, we had total debt of $5.5 billion, primarily related to Senior Notes and credit agreements.

Being indebted could have important consequences to us.

7 unchanged sentences

Moreover, our credit agreements and the indentures governing our Senior Notes permit us to incur substantial additional indebtedness, which may further contribute to, or exacerbate the impact of, the foregoing impacts.

The indentures for our outstanding Senior Notes and our 2022 and 2024 Credit Agreements contain various covenants that limit our management’s discretion in the operation of our businesses.

Our Credit Agreements subject us to customary (i) affirmative covenants, including requirements with respect to certain reporting obligations on us and our subsidiaries, and (ii) negative covenants, including limitations on:

The indentures for our outstanding Senior Notes and the agreements governing certain of our credit facilities contains various covenants that limit our management’s discretion in the operation of our businesses.

Our credit agreement subjects us to customary (i) affirmative covenants, including requirements with respect to certain reporting obligations on us and our subsidiaries, and (ii) negative covenants, including limitations on:

indebtedness;

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and use of proceeds.

In addition, we are required to maintain (i) an Interest Coverage Ratio of at least 3.00 to 1.00, calculated using an earning metric as defined in the agreement compared to Interest Expense for the four quarters then ended and (ii) a Leverage Ratio, calculated by net debt (total debt, net of up to $300 million of unrestricted cash) as of the last day of such fiscal quarter to the defined earnings metric for the four quarters then ended, of 3.5 or less.

In addition, we are required to maintain (i) an Interest Coverage Ratio of at least 3.00 to 1.00, calculated using an earnings metric as defined in the agreement compared to Interest Expense for the four quarters then ended and (ii) a Leverage Ratio, calculated by net debt (total debt, net of up to $500 million of unrestricted cash) as of the last day of such fiscal quarter to the defined earnings metric for the four quarters then ended, of 3.5 or less.

All terms are as defined in the credit agreements.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors