What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-13 compared with 2025-02-12 · 357 added, 406 removed, 879 unchanged (46% of the section changed)

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

During 2024, the Company completed the acquisitions of Tehnika Pty.

Ltd., Fanox Electronic, S.L., Kompozitum s.r.o., and Bloom Engineering Holdings, Inc.

Management is currently integrating the acquisitions into its operations, compliance programs and internal control processes and as such, has excluded the acquisitions from its assessment of internal controls over financial reporting as of December 31, 2024.

During 2025, the Company completed the acquisitions of Continental Railworks Technology I Inc., Dotnetix Proprietary Limited and Dotnetix SA Proprietary Limited, Evident's Inspection Technologies Division, and Frauscher Sensor Technology Group GmbH, and is currently integrating the acquisitions into its operations, compliance programs and internal control processes and as such, has excluded the acquisitions from its assessment of internal controls over financial reporting as of December 31, 2025.

The acquisitions are all subsidiaries whose combined total assets represent 2.4% and combined net sales represent 2.5% of the related consolidated financial statement amounts as of and for the year ended December 31, 2025.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Over Time Revenue Recognition for Long-Term Contracts

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The Company uses input-based measures for determining the amount of revenue, cost, and gross margin to recognize over time for these customer arrangements.

The input methods used for these arrangements include costs of material and labor.

The inputs used for these arrangements include costs of material and labor.

During the year ended December 31, 2025, a material amount of the Company's total revenues were derived from performance obligations that are satisfied over time.

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In addition, for certain contracts, we involved our internal valuation specialists to assist in our evaluation of management’s cost estimates at completion.

Valuation of Customer Relationships Intangible Asset in the Acquisition of Evident’s Inspection Technologies Division

Description of the Matter As discussed in Note 3 to the consolidated financial statements, on July 1, 2025, the Company acquired Evident’s Inspection Technologies division (“Inspection Technologies”).

The transaction was accounted for under the acquisition method of accounting.

The Company preliminarily determined the fair value of the identified customer relationships intangible asset to be $411 million using an income approach.

Auditing the Company’s valuation of the acquired customer relationships intangible asset was complex due to estimation uncertainty in determining the fair value.

The estimation uncertainty was primarily due to the sensitivity of the fair value of the customer relationships intangible asset to underlying assumptions about the future performance of the acquired Inspection Technologies business.

The significant assumptions used to estimate the fair value of the customer relationships intangible asset included a discount rate and certain assumptions that form the basis of the forecasted results (future revenue and earnings before interest, taxes, depreciation, and amortization margin).

These significant assumptions are forward looking and could be affected by future economic and market conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s process to estimate the fair value of the acquired customer relationships intangible asset.

We also tested controls over management’s review of the significant assumptions used in the fair value calculation described above and management’s review of the valuation model.

To test the estimated fair value of the acquired customer relationships intangible asset, our audit procedures included, among others, evaluating the Company's use of the income approach, testing the significant assumptions described above, and testing the completeness and accuracy of the underlying data supporting the significant assumptions and estimates.

For example, we compared the significant assumptions used by management to observable market data, current industry and economic trends, and actual operating results realized subsequent to the acquisition.

We also performed sensitivity analyses of the significant assumptions to evaluate the changes in the fair value of customer relationships intangible asset resulting from changes in the significant assumptions.

In addition, we involved our valuation specialists to assist in our evaluation of the methodologies and certain significant assumptions used by the Company, such as the discount rate.

/s/ Ernst & Young LLP

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In our opinion, Westinghouse Air Brake Technologies Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.

As indicated in the accompanying Management's Report on Internal Control over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Tehnika Pty Ltd Australia, Fanox Electronic, S.L., Kompozitum s.r.o, and Bloom Engineering Holdings, Inc., which are included in the 2024 consolidated financial statements of the Company and constituted 1.3% of total assets as of December 31, 2024 and 0.1% of net sales, for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of Tehnika Pty Ltd Australia, Fanox Electronic, S.L., Kompozitum s.r.o, and Bloom Engineering Holdings, Inc.

As indicated in the accompanying Management's Report on Internal Control over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Continental Railworks Technology I Inc., Dotnetix Proprietary Limited and Dotnetix SA Proprietary Limited, Evident's Inspection Technologies Division, and Frauscher Sensor Technology Group GmbH, which are included in the 2025 consolidated financial statements of the Company and constituted 2.4% of total assets as of December 31, 2025 and 2.5% of net sales, for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of Continental Railworks Technology I Inc., Dotnetix Proprietary Limited and Dotnetix SA Proprietary Limited, Evident's Inspection Technologies Division, and Frauscher Sensor Technology Group GmbH.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2025, and the related notes and financial statement schedule listed in the Index at Item 15(2) and our report dated February 13, 2026 expressed an unqualified opinion thereon.

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Long-term debt 4,291 3,480

Accrued postretirement and pension benefits 58 62

Deferred income taxes 606 376

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Common stock, $ .01 par value;

500.0 shares authorized and 226.9 shares issued;

171.3 and 177.8 shares outstanding at December 31, 2024 and 2023, respectively

500.0 shares authorized;

171.9 shares issued and 170.6 outstanding at December 31, 2025;

226.9 shares issued and 171.3 outstanding at December 31, 2024

Additional paid-in capital 8,069 8,023

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Net income attributable to Wabtec shareholders $ 1,170 $ 1,056 $ 815

Foreign currency translation (loss) gain ( 277 ) 55 ( 200 )

Unrealized gain (loss) on derivative contracts 14 22 ( 5 )

Unrealized gain on pension benefit plans and post-retirement benefit plans 14 — 11

Other comprehensive (loss) income before tax ( 249 ) 77 ( 194 )

Income tax expense related to components of other comprehensive (loss) income ( 7 ) ( 6 ) ( 1 )

Other comprehensive (loss) income, net of tax ( 256 ) 71 ( 195 )

Foreign currency translation gain (loss) 229 ( 277 ) 55

Unrealized gain on derivative contracts 8 14 22

Unrealized (loss) gain on pension benefit plans and post-retirement benefit plans ( 7 ) 14 —

Other comprehensive income (loss) before tax 230 ( 249 ) 77

Income tax expense related to components of other comprehensive income (loss) — ( 7 ) ( 6 )

Other comprehensive income (loss), net of tax 230 ( 256 ) 71

Comprehensive income attributable to Wabtec shareholders $ 1,400 $ 800 $ 886

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Stock-based compensation expense 80 66 47

Net loss on business disposition 38 — —

Net gain on mark-to-market derivatives

Below market intangible amortization ( 44 ) ( 44 ) ( 54 )

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Investing Activities

Purchase of property, plant and equipment ( 207 ) ( 186 ) ( 149 )

Acquisitions of businesses, net of cash acquired ( 2,520 ) ( 168 ) ( 308 )

Purchase of property, plant and equipment ( 260 ) ( 207 ) ( 186 )

Proceeds from dispositions of businesses, net of cash disposed 8 19 —

Settlement of foreign currency derivatives related to acquisition

Proceeds from disposal of property, plant and equipment 5 13 2

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Cash dividends ( 173 ) ( 140 ) ( 123 )

Payment of contingent consideration on acquisitions ( 42 ) ( 112 ) ( 101 )

Payment of contingent consideration — ( 42 ) ( 112 )

Payment of income tax withholding on share-based compensation ( 40 ) ( 25 ) ( 16 )

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Other financing activities ( 11 ) 3 2

Net cash used for financing activities ( 1,371 ) ( 633 ) ( 708 )

Effect of changes in currency exchange rates ( 25 ) 3 ( 27 )

Net cash provided by (used for) financing activities 1,031 ( 1,371 ) ( 633 )

Effect of changes in currency exchange rates on cash 31 ( 25 ) 3

Increase in cash 74 95 79

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Net income — — — — — 815 — 10 825

Other comprehensive loss, net of tax — — — — — — ( 195 ) — ( 195 )

Other comprehensive income, net of tax — — — — — — 71 — 71

Stock repurchase — — — ( 3.9 ) ( 412 ) — — — ( 412 )

Distribution to noncontrolling interest — — — — — — — ( 17 ) ( 17 )

Other — — — — — — — ( 1 ) ( 1 )

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Net income — — — — — 1,056 — 11 1,067

Other comprehensive income, net of tax — — — — — — 71 — 71

Other comprehensive loss, net of tax — — — — — — ( 256 ) — ( 256 )

Stock repurchase — — — ( 6.9 ) ( 1,107 ) — — — ( 1,107 )

Distribution to noncontrolling interest — — — — — — — ( 6 ) ( 6 )

Other — — — — — — — ( 1 ) ( 1 )

Balance, December 31, 2024 226.9 $ 2 $ 8,023 ( 55.6 ) $ ( 3,273 ) $ 6,185 $ ( 846 ) $ 42 $ 10,133

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Net income — — — — — 1,170 — 13 1,183

Other comprehensive loss, net of tax — — — — — — ( 256 ) — ( 256 )

Other comprehensive income, net of tax — — — — — — 230 — 230

Stock repurchase — — — ( 1.1 ) ( 224 ) — — — ( 224 )

Treasury stock retirement ( 55.0 ) ( 1 ) — 55.0 3,305 ( 3,304 ) — — —

Distribution to noncontrolling interest — — — — — — — ( 6 ) ( 6 )

Balance, December 31, 2024 226.9 $ 2 $ 8,023 ( 55.6 ) $ ( 3,273 ) $ 6,185 $ ( 846 ) $ 42 $ 10,133

Other — — — — — — — ( 1 ) ( 1 )

Balance at December 31, 2025 171.9 $ 1 $ 8,069 ( 1.3 ) $ ( 190 ) $ 3,878 $ ( 616 ) $ 48 $ 11,190

The accompanying notes are an integral part of these statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Wabtec is a global provider of value-added, technology-based locomotives, equipment, systems, and services for the freight rail and passenger transit industries as well as the mining, marine and industrial markets.

Our highly engineered products, which are intended to enhance safety, improve productivity and reduce maintenance costs for customers, can be found on most locomotives, freight cars, passenger transit cars and buses around the world.

Wabtec is a global provider of value-added, technology-based locomotives, equipment, systems, and services for the freight rail and passenger transit industries, as well as the mining, marine, and industrial markets and applications.

Our highly engineered rail and transit products, which are intended to enhance safety, improve productivity and reduce maintenance costs for customers, can be found on most locomotives, freight cars, passenger transit cars, and buses around the world.

Our core products and services are essential in the safe and efficient operation of freight rail and passenger transit vehicles.

Wabtec is a global company with operations in over 50 countries and our products can be found in more than 100 countries throughout the world.

In 2024, approximately 53 % of the Company’s net sales came from customers outside the United States.

In 2025, approximately half of the Company’s net sales came from customers outside the United States.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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For consolidated subsidiaries in which the Company's ownership is less than 100%, the outside shareholders' interests are shown as noncontrolling interests.

The Company also invests in privately-held companies which are accounted for using the equity method when the Company has the ability to exercise significant influence, but not control, over the investee.

These statements have been prepared in accordance with U.S.

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Sales between subsidiaries are eliminated in consolidation.

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period.

Actual amounts could differ materially from the estimates.

On an ongoing basis, Management reviews its estimates based on currently available information.

Changes in facts and circumstances may result in revised estimates.

Cash Equivalents and Restricted Cash Cash equivalents are highly liquid investments purchased with an original maturity of three months or less.

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Right-of-use lease assets are classified as long-term assets under the caption "Other noncurrent assets" and lease liabilities are classified under the captions "Other accrued liabilities" and "Other long-term liabilities" on the Consolidated Balance Sheets.

Business Combinations The Company accounts for business acquisitions under the acquisition method of accounting, in accordance with ASC 805, Business Combinations, which requires the purchase price of the acquired business to be allocated to tangible and intangible assets acquired and liabilities assumed based on the respective fair values.

The amount of purchase price which is in excess of the fair value of assets acquired and liabilities assumed is recognized as goodwill.

Goodwill and Intangible Assets Goodwill and other intangible assets with indefinite lives are not amortized.

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Periodically, Management of the Company assesses whether or not an indicator of impairment is present that would necessitate an impairment analysis be performed.

Equity Method Investments The Company invests in privately-held companies which are accounted for using the equity method when the Company has the ability to exercise significant influence, but not control, over the investee.

Equity method investments are included in "Other noncurrent assets" on the Consolidated Balance Sheets and were $ 39 million and $ 36 million at December 31, 2024 and 2023, respectively.

Depreciation Expense Depreciation of property, plant and equipment related to the manufacturing of products or services provided is included in Cost of goods or Cost of services.

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Realized gains and losses related to foreign currency exchange are recognized in Other income, net on the Consolidated Statements of Income.

Noncontrolling Interests In accordance with ASC 810, the Company has classified noncontrolling interests as equity on our Consolidated Balance Sheets.

Net income attributable to noncontrolling interests was not material for the years ended December 31, 2024, 2023 and 2022.

Revenue Recognition The Company accounts for Revenue under ASC 606 Revenue from Contracts with Customers .

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Contract estimates related to long-term projects are based on various assumptions to project the outcome of future events that could span several years.

These assumptions include cost of materials;

assumptions include cost of materials;

labor availability and productivity;

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We have a disciplined process where management reviews the progress of long-term projects periodically throughout the year.

As part of this process, management reviews information including key contract matters, progress towards completion, identified risks and

opportunities and any other information that could impact the Company’s estimates of revenue and costs.

As part of this process, management reviews information including key contract matters, progress towards completion, identified risks and opportunities and any other information that could impact the Company’s estimates of revenue and costs.

After completing this analysis, any adjustments to net sales, cost of goods sold, and the related impact to operating income are recognized as necessary in the period they become known.

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The Company expects to recognize revenue of approximately 30 % of remaining performance obligations over the next 12 months, with the remainder recognized thereafter.

Revolving Receivables Program The Company utilizes a revolving facility to sell up to $ 350 million of certain receivables of the Company and certain of its subsidiaries (the "Originators").

The Originators contribute receivables to our bankruptcy-remote subsidiary, which sells the receivables to a financial institution on a recurring basis in exchange for cash equal to the gross receivables sold.

Revolving Receivables Program Effective January 1, 2025, the Company utilizes its Revolving Receivables Program to request borrowings from a financial institution against certain collateralized receivables for up to $ 350 million.

During the third quarter of 2025, the Company amended the Revolving Receivables Program to increase its availability from $ 350 million to up to $ 450 million.

The Company and certain of its subsidiaries (the "Originators") contribute receivables to our bankruptcy-remote subsidiary, which can then be collateralized on a recurring basis.

As customers pay their balances, we transfer additional receivables into the program.

Borrowings and repayments under the Revolving Receivables Program are classified as Financing activities on our Consolidated Statement of Cash Flows, with any outstanding collateralized balance at period end classified as debt on our Consolidated Balance Sheets.

Prior to January 1, 2025, the Company utilized its Revolving Receivables Program to sell up to $ 350 million of certain receivables from the Originators.

Receivables were sold to a financial institution on a recurring basis in exchange for cash equal to the gross receivables sold.

Proceeds and remittances of receivables sold under the program prior to January 1, 2025 are classified as Operating activities on our Consolidated Statement of Cash Flows.

For the years ended December 31, 2024 and 2023, the net cash proceeds remitted to the financial institution were $ 20 million and $ 60 million, respectively.

The bankruptcy remote subsidiary is a separate legal entity with its own creditors, and its assets are not available to pay creditors of the Company or any other affiliates of the Company.

As customers pay their balances, we transfer additional receivables into the program, which could result in our gross receivables sold being higher or lower than customer collections remitted to the financial institution for any applicable period.

The sold receivables are fully guaranteed by our bankruptcy-remote subsidiary, which holds additional receivables that are pledged as collateral under this facility.

The receivables transferred to the program are fully guaranteed by our bankruptcy-remote subsidiary, which holds additional receivables that are pledged as collateral under this facility.

The Company has agreed to guarantee the performance of the Originators' respective obligations under the revolving agreement.

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At December 31, 2025 and 2024, the bankruptcy-remote subsidiary held receivables of $ 623 million and $ 693 million, respectively, which are included in the Company's Consolidated Balance Sheets.

The receivables held by the bankruptcy-remote subsidiary collateralize the outstanding receivables sold, which was $ 20 million at December 31, 2023.

There were no receivables outstanding under the facility at December 31, 2024.

The transfers are recorded at the fair value of the proceeds received and obligations assumed less derecognized receivables.

No obligation was recorded at December 31, 2024 or 2023 as the estimated expected credit losses on receivables sold is insignificant.

The receivables held by the bankruptcy-remote subsidiary collateralize the outstanding receivables sold and outstanding borrowings.

There were no collateralized borrowings or outstanding receivables sold at December 31, 2025 and 2024.

The transfers are recorded at the fair value of the proceeds received and obligations assumed less derecognized receivables, if applicable.

Our maximum exposure to losses related to these receivables transferred is limited to the amount outstanding.

The following table sets forth a summary of receivables sold and the resulting impact of net cash processed included in cash from operations:

For the year ended

In millions 2024 2023 2022

Gross receivables sold/cash proceeds received $ 926 $ 2,617 $ 1,761

Customer collections remitted to financial institution ( 946 ) ( 2,677 ) ( 1,701 )

Net cash proceeds (remitted) received included in cash from operations $ ( 20 ) $ ( 60 ) $ 60

During the fourth quarter of 2024, the revolving receivables program agreement was amended to allow us to request loans from the financial institution secured by the receivables held in the program, up to the $ 350 million limit.

As a result, effective January 1, 2025 proceeds and repayments of loans under the program will be classified as Financing activities on our statement of cash flows and outstanding balances will be classified as debt on our balance sheet.

Pre-Production Costs Certain pre-production costs relating to long-term production and supply contracts have been deferred and will be recognized over the life of the contracts.

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At December 31, 2025 and 2024 there was no preferred stock issued or outstanding.

cars in their operations, such as utility and chemical companies, as well as companies in the mining, marine and industrial markets.

Significant Customers and Concentrations of Credit Risk The Company’s trade receivables are primarily from rail and transit industry original equipment manufacturers, Class I railroads, railroad carriers and commercial companies that utilize rail cars in their operations, such as utility and chemical companies, as well as companies in the mining, marine and industrial markets and applications.

No one customer accounted for more than 10% of the Company’s consolidated net sales in the periods presented.

Reclassifications Certain prior year amounts have been reclassified, where necessary, to conform to the current year presentation.

Actual amounts could differ materially from the estimates.

On an ongoing basis, Management reviews its estimates based on currently available information.

Changes in facts and circumstances may result in revised estimates.

Accounting Standards Recently Issued In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The amendments in this update require entities to disclose on an annual basis specific categories within the income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.

The amendments in this update also require enhanced disaggregation of disclosures about income taxes paid and income tax expense, among other changes.

The amendments in this update do not affect the recognition, measurement, or financial statement presentation of income taxes and is effective for Wabtec's annual reporting periods beginning January 1, 2025.

The amendments require increased annual disclosures on current and comparable reporting periods presented in annual company filings.

The resulting new annual disclosure requirements will be reflected in our 2025 report on Form 10-K.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Accounting Standards Recently Issued In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses .

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The Company is assessing the extent of the impact of the amendments on its future filings.

Accounting Standards Recently Adopted In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .

The amendments in this update are intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

In addition to the current requirements, the amendments specify additional information be provided about the chief operating decision maker ("CODM") as well as disaggregated expense categories, to the extent that the CODM utilizes such data in deciding how to allocate resources.

The amendments in this update do not affect the recognition, measurement, or financial statement presentation of expenses, and were effective for Wabtec's annual reporting periods beginning January 1, 2024 and will be effective for interim reporting periods beginning January 1, 2025.

The amendments require increased interim and annual disclosures on current and comparable reporting periods presented in annual and interim company filings.

Accounting Standards Recently Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The amendments in this update also require enhanced disaggregation of disclosures about income taxes paid and income tax expense, among other changes.

The amendments in this update do not affect the recognition, measurement, or financial statement presentation of income taxes and are effective for Wabtec's annual reporting periods beginning January 1, 2025.

The amendments require increased annual disclosures on current and future comparable reporting periods presented in annual company filings.

The new annual disclosure requirements are included in Note 11.

Treasury Stock The Company records treasury stock purchases at cost.

The cost of shares repurchased is recorded as a reduction of stockholders' equity.

The retirement of treasury stock is recognized as a deduction from common stock for the shares' par value and any excess over par as a deduction from retained earnings.

During the first quarter of 2025, the Company retired 55 million shares of treasury stock.

Supply Chain Financing Program The Company has entered into supply chain financing arrangements with third-party financial institutions to provide our vendors with enhanced payment options while providing the Company with added working capital flexibility.

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The supplier invoices included under the program require payment in full to the financial institutions consistent with the Company’s normal terms and conditions as agreed upon with the vendor.

The following table sets forth the changes in amounts due to financial institutions reflected in Accounts payable for the year ended December 31, 2024:

The following table reconciles the changes in amounts due to financial institutions reflected in Accounts payable as follows:

In millions 2025 2024

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Obligations outstanding at the end of the year $ 285 $ 311

During 2024, the Company made four strategic acquisitions for a combined purchase price of approximately $ 168 million, net of cash acquired.

Two of the acquisitions are reported in the Transit Segment, one is reported in the Digital Intelligence product line of the Freight Segment and one is reported in the Components product line of the Freight Segment.

Each of the acquisitions in 2024 are individually and collectively immaterial.

On December 22, 2023, the Company purchased the remaining ownership shares of Lokomotiv Kurastyru Zauyty (LKZ), a locomotive manufacturing and assembly company located in Kazakhstan, at which time it became a wholly owned subsidiary of the Company.

Prior to this purchase, Wabtec owned 50 % of LKZ as a joint venture partner and accounted for its ownership interest as an equity method investment.

Total purchase price for the remaining 50 % interest was $ 111 million.

As a result of the change in ownership interest and obtaining control of LKZ, Wabtec's previously held equity interest balance was remeasured to fair value, resulting in a gain of approximately $ 35 million recorded to Other income, net.

Upon acquisition, Wabtec ceased accounting for the investment using the equity method and recognized 100 % of LKZ's identifiable assets and liabilities, and LKZ's results of operations and cash flows are fully consolidated subsequent to the acquisition date.

The following table summarizes the fair value of 100 % of the LKZ assets acquired and liabilities assumed:

On December 1, 2025, Wabtec acquired Frauscher Sensor Technology Group GmbH ("Frauscher"), a global market leader in train detection, wayside object control solutions and axle counting systems for approximately $ 792 million.

The acquisition positions Wabtec for accelerated, profitable growth, and further strengthens the Company’s product portfolio by adding highly attractive and complementary railway signaling technologies.

Frauscher reports within the Digital Intelligence product line of the Freight Segment.

The acquisition was funded with a combination of cash on hand, proceeds from the 2025 Term Credit Agreement and borrowings under other sources of available liquidity.

The following table summarizes the preliminary fair value of the Frauscher assets acquired and liabilities assumed:

Assets acquired

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Accounts receivable 48

Other current assets 5

Property, plant and equipment 14

Other intangible assets 393

Other noncurrent assets 24

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Net assets acquired $ 792

The fair values of the assets acquired and liabilities assumed were determined using the income, cost and market approaches.

Goodwill was calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of the net assets acquired and represents the assembled workforce and the future economic benefits of expanding our global operations expected to be achieved as a result of the acquisition.

As of December 31, 2025, the measurement period remains open, and the Company has not finalized the purchase accounting for the acquisition.

Certain information necessary to complete the purchase price allocation is not yet available, including, but not limited to, valuations of assets acquired and liabilities assumed and final income tax computations.

The amounts recognized for the assets acquired and liabilities assumed are provisional and may be adjusted as the Company continues to obtain and evaluate information about facts and circumstances that existed as of the acquisition date and complete the valuations of assets acquired and liabilities assumed, consistent with the measurement‑period guidance in ASC 805.

Any necessary adjustments will be finalized within one year from the date of acquisition, once the Company has received the necessary information.

Intangible assets acquired include customer relationships and acquired technology that are subject to amortization, and trade names that were assigned an indefinite life and are not subject to amortization.

The fair value of these intangibles are preliminary in nature and subject to adjustments, which could be material as the Company has not completed its valuation of acquired assets and liabilities.

Goodwill was calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of the net assets acquired, and represents the assembled workforce and the future economic benefits, including synergies, that are expected to be achieved as a result of the acquisition.

The purchased goodwill is not expected to be deductible for tax purposes.

The results of this business since the date of acquisition are reported within the Equipment product line of the Freight Segment.

The net sales and results of operations subsequent to the acquisition date were not material to the Company’s consolidated net sales or results of operations.

The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

On July 1, 2025, Wabtec acquired 100 % ownership in Evident’s Inspection Technologies division ("Inspection Technologies") for approximately $ 1.788 billion.

Inspection Technologies was formerly part of the Scientific Solutions Division of Olympus Corporation, a global leader in nondestructive testing, remote visual inspection and analytical instruments solutions for mission critical assets.

Inspection Technologies’ leading industry presence and innovative product portfolio is expected to significantly expand Wabtec's capabilities, adding advanced automated inspection capabilities, driving technology in a space where data acquisition, analytics and automation are critical.

Inspection Technologies reports within the Digital Intelligence product line of the Freight Segment.

The acquisition was funded with a combination of cash on hand, proceeds from the 2035 Notes, and borrowings under other sources of available liquidity.

The following table summarizes the preliminary fair value of the Inspection Technologies assets acquired and liabilities assumed:

Assets acquired

Cash and cash equivalents $ 44

Accounts receivable 73

Inventory 144

Other current assets 8

Property, plant and equipment 59

Customer relationships 411

Trade names 142

Acquired technology 170

Other noncurrent assets 37

Total assets acquired 2,024

Liabilities assumed

Current liabilities 65

Noncurrent liabilities 171

Total liabilities assumed 236

Net assets acquired $ 1,788

As of December 31, 2025, the measurement period remains open, and the Company has not finalized the purchase accounting for the acquisition.

The fair values of the assets acquired and liabilities assumed were determined using the income, cost and market approaches.

Discounted cash flow models were used to estimate the fair values of acquired intangible assets.

The fair value measurements were primarily based on significant inputs that are not observable in the market and are considered Level 3 in the fair value hierarchy.

Contingent liabilities assumed as part of the transaction were not material.

These estimates are preliminary in nature and subject to adjustments, which could be material as the Company has not completed its valuation of acquired assets and liabilities.

Certain information necessary to complete the purchase price allocation is not yet available, including, but not limited to, final valuations of assets acquired and liabilities assumed and final income tax computations.

Any necessary adjustments will be finalized within one year from the date of acquisition, once the Company has received the necessary information.

Approximately half of the purchased goodwill is expected to be deductible for tax purposes.

The net sales and results of operations subsequent to the acquisition date were not material to the Company’s consolidated net sales or results of operations.

The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

Also during 2025, the Freight Segment completed two additional acquisitions for a combined purchase price of approximately $ 26 million, net of cash acquired, which were individually and collectively immaterial.

On March 18, 2025, Wabtec announced a definitive agreement to acquire Dellner Couplers, a global leader in highly engineered safety-critical train connection systems and services for passenger rail rolling stock, for approximately € 890 million.

The transaction subsequently closed on February 10, 2026.

Transaction costs related to the completed and announced acquisitions for the year ended December 31, 2025, were approximately $ 49 million and are included in Selling, general, and administrative expenses.

During 2024, the Company made four strategic acquisitions for a combined purchase price of approximately $ 168 million, net of cash acquired.

Each of the acquisitions in 2024 are individually and collectively immaterial.

On December 22, 2023, the Company purchased the remaining ownership shares of Lokomotiv Kurastyru Zauyty ("LKZ"), a locomotive manufacturing and assembly company located in Kazakhstan, at which time it became a wholly owned subsidiary of the Company.

Prior to this purchase, Wabtec owned 50 % of LKZ as a joint venture partner and accounted for its ownership interest as an equity method investment.

Total purchase price for the remaining 50 % interest was $ 111 million, and was allocated primarily to goodwill.

During the second quarter of 2023, the Company acquired L&M Radiator, Inc., a leading manufacturer of heavy-duty equipment radiators and heat exchangers for the mining sector, for a purchase price of approximately $ 245 million.

The results of this business since the date of acquisition are reported within the Components product line of the Freight Segment.

The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

The following table summarizes the fair value of the L&M Radiator, Inc.

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The purchased goodwill is not expected to be deductible for tax purposes.

The results of this business since the date of acquisition are reported within the Components product line of the Freight Segment.

The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

During 2022, the Freight Segment made three strategic acquisitions for a combined purchase price of $ 89 million, net of cash acquired.

Two of the acquisitions are reported in the Digital Intelligence product line and one is reported in the Services product line.

Each of the acquisitions in 2022 are individually and collectively immaterial.

SUPPLEMENTAL CASH FLOW DISCLOSURES

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Interest paid during the year $ 219 $ 181 $ 210

Income taxes paid during the year, net of amounts refunded $ 237 $ 233 $ 157

Business acquisitions:

2 unchanged sentences

Cash paid 2,593 194 356

Cash acquired ( 26 ) ( 48 ) ( 1 )

Cash and cash equivalents acquired

( 73 ) ( 26 ) ( 48 )

Net cash paid $ 2,520 $ 168 $ 308

At December 31, 2024 and December 31, 2023, Wabtec had restricted cash of $ 9 million and $ 5 million, respectively, primarily from cash in escrow related to acquisitions.

At December 31, 2025 and December 31, 2024, Wabtec had restricted cash of $ 25 million and $ 9 million, respectively, primarily for cash held in escrow related to acquisitions.

The components of inventory, net of reserves, were:

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Two reporting units exist within the Freight segment (the "Freight" and "Components" reporting units), and the Transit segment is also a reporting unit.

In 2024, management elected to first assess qualitative factors to determine whether a quantitative goodwill impairment test is necessary for the Components and Freight reporting units.

In 2025, management elected to first assess qualitative factors to determine whether a quantitative goodwill impairment test is necessary for the Freight and Transit reporting units.

During the assessment, management evaluated all relevant events and facts that may impact the fair value or carrying value of the reporting units' goodwill and concluded that it was not more likely than not that the estimated fair values were less than the carrying values;

therefore, no further analysis was required.

For the Transit reporting unit, management elected to proceed directly to the quantitative impairment test.

The discounted cash flow method and the market approach were used to estimate the fair value of the Transit reporting unit using a weighting of 75 % and 25 %, respectively.

The discounted cash flow model requires several assumptions including future sales growth, EBIT (earnings before interest and taxes) margins, capital expenditures, a discount rate and a terminal revenue growth rate (the revenue growth rate for the period beyond the years forecasted by the reporting units) for the Transit reporting unit.

For the Components reporting unit, management elected to proceed directly to the quantitative impairment test.

The discounted cash flow method and the market approach were used to estimate the fair value of the Components reporting unit using a weighting of 75 % and 25 %, respectively.

The market approach requires several assumptions including EBITDA (earnings before interest, taxes, depreciation and amortization) multiples for comparable companies that operate in the same markets as the Company’s reporting units.

For 2025, the discounted cash flow method was given more weight compared to the market approach due to variables between the operations of the guideline companies used in the analysis and Wabtec's operations, such as different reporting unit sizes, growth and business characteristics.

Each valuation resulted in a conclusion that the estimated fair value of the Transit reporting unit was in excess of its carrying value, and no impairment existed.

Each valuation resulted in a conclusion that the estimated fair value of the Components reporting unit was in excess of its carrying value, and no impairment existed.

The change in the carrying amount of goodwill by segment is as follows:

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During 2025 and 2024, the Company proceeded directly to the quantitative impairment test for certain trade names with indefinite lives.

Certain trade names that were associated with the Company’s current restructuring actions were tested and considered impaired.

As such, for the years ended December 31, 2024 and 2023, approximately $ 6 million and $ 14 million, respectively, of amortization expense was recorded in "Amortization expense" on the Consolidated Statements of Income, primarily related to the Company's Portfolio Optimization.

For the remaining trade names subject to the quantitative impairment test, the fair value exceeded each respective carrying value, resulting in a conclusion that no additional impairment existed.

For trade names not subject to quantitative testing, the Company elected to perform a qualitative impairment assessment, resulting in a conclusion that it was not more likely than not that the estimated fair values of the trade names were less than their carrying values;

For 2025 and 2024, certain trade names that were associated with the Company’s current restructuring actions were tested and considered impaired.

As such, for the year ended December 31, 2025 and 2024, approximately $ 3 million and approximately $ 6 million of expense was recorded, respectively, primarily related to the Company's Portfolio Optimization.

For the remaining trade names subject to the quantitative impairment test in both 2025 and 2024, the fair value exceeded each respective carrying value, resulting in a conclusion that no additional impairment existed.

For other trade names, management assessed qualitative factors and concluded that it was not more likely than not that the estimated fair values of the trade names were less than their carrying values;

therefore, no further analysis was required.

The assessment of qualitative factors used in determining whether it is more likely than not that the fair value of a trade name is less than its carrying amount involves significant judgments and assumptions.

The judgment and assumptions include the identification of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, Wabtec specific events, share price trends and making the assessment on whether each relevant factor will impact the impairment test positively or negatively and the magnitude of any such impact.

As of December 31, 2024 and 2023, the Company’s trade names had a net carrying amount of $ 595 million and $ 612 million, respectively, and the Company believes these intangibles have indefinite lives, with the exception of the right to use the GE Transportation trade name, to which the Company had an original useful life of 5 years and has been fully amortized.

The judgment and assumptions include the identification of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, Wabtec specific events, share price trends and assessing whether each relevant factor will impact the impairment test positively or negatively and the magnitude of any such impact.

As of December 31, 2025 and 2024, the Company’s trade names had a net carrying amount of $ 851 million and $ 595 million, respectively, and the Company believes these intangibles have indefinite lives, with the exception of the right to use the GE Transportation trade name, to which the Company had an original useful life of 5 years and became fully amortized in the first quarter of 2024.

Intangible assets of the Company, other than goodwill and trade names, that are considered definitive lived consist of the following:

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Amortization expense for intangible assets was $ 300 million, $ 303 million, and $ 321 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Estimated amortization expense for the five succeeding years is as follows (in millions):

Amortization expense for the five succeeding years is estimated to be as follows:

CONTRACT ASSETS AND CONTRACT LIABILITIES

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Recognized in current year 1,659 1,562

Amounts in beginning balance reclassified to revenue ( 572 ) ( 665 )

Current year amounts reclassified to revenue ( 876 ) ( 593 )

Amounts in beginning balance reclassified to net sales

( 554 ) ( 572 )

Current year amounts reclassified to net sales

( 958 ) ( 876 )

Acquisitions 1 8

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2025 Credit Agreement:

Revolving Credit Facility 6.0 % N/A $ — $ — $ — $ —

Term Loan Facility, due 2030

5.6 % $ 725 721 725 — —

2025 Term Credit Agreement:

Term Loan, due 2026

4.9 % $ 500 500 500 — —

2024 Credit Agreement:

Term Loan — % $ — — — 224 225

2022 Credit Agreement:

Revolving Credit Facility 8.0 % N/A — — — —

Delayed Draw Term Loan — % $ — — — 250 250

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3.20 % Senior Notes, due 2025

— % $ — — — 500 496

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5.1 % $ 500 496 512 — —

5.611 % Senior Notes, due 2034

5.7 % $ 500 496 526 496 507

5.50 % Senior Notes, due 2035

5.6 % $ 750 743 783 — —

Other Borrowings 5 5 — —

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Total $ 5,567

For those debt securities that have a premium or discount at the time of issuance, the Company amortizes the amount through interest expense based on the maturity date or the first date the holders may require the Company to repurchase the debt securities, if applicable.

A premium would result in a decrease in interest expense, and a discount would result in an increase in interest expense in future periods.

Additionally, the Company has debt issuance costs related to certain financing transactions which are also amortized through interest expense.

As of December 31, 2024 and 2023, the Company had total unamortized debt issuance costs and discounts of $ 15 million.

The Company has debt issuance costs related to certain financing transactions which are amortized through interest expense.

As of December 31, 2025 and 2024, the Company had total unamortized debt issuance costs and discounts of $ 26 million and $ 15 million, respectively.

Credit Agreements

2024 Credit Agreement

On March 14, 2024, the Company entered into a new stand-alone credit agreement (the "2024 Credit Agreement") for a term loan of $ 225 million.

Borrowings under the 2024 Credit Agreement bear interest at a base rate plus an interest rate spread up to 1.75 % based on the lower of the pricing corresponding to (i) the Company’s Leverage Ratio or (ii) the Company’s public rating.

At December 31, 2024, the interest rate was 6.0 %.

The frequency of interest payments varies based upon the Interest

Election Request.

The term loan issued under the 2024 Credit Agreement will mature on March 14, 2029.

The obligations of the Company under the 2024 Credit Agreement are unsecured and have been guaranteed by certain of the Company’s subsidiari es.

On November 28, 2025, the Company entered into a new stand-alone credit agreement (the "2025 Term Credit Agreement") for a term loan of $ 500 million.

Borrowings under the 2025 Term Credit Agreement bear interest at a base rate plus an interest rate spread up to 1.50 % based on the lower of the pricing corresponding to (i) the Company's Leverage Ratio or (ii) the Company's public credit rating.

The frequency of interest payments varies based upon the Interest Election Request.

The term loan issued under this agreement will mature on November 27, 2026.

The obligations of the Company under this agreement are unsecured and have been guaranteed by certain of the Company's subsidiaries.

The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.

Under the 2024 Credit Agreement, the Company has agreed to maintain an Interest Coverage Ratio of at least 3.0 to 1.0, and a Leverage Ratio not to exceed 3.5 to 1.0.

The Interest Coverage Ratio is calculated using an earnings metric as defined in the agreement compared to Interest Expense for the four quarters then ended.

The Leverage Ratio is defined as 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.

Additionally, the Company may effect an increase in the maximum Leverage Ratio in contemplation of a Material Acquisition.

All terms are as defined in the 2024 Credit Agreement.

2022 Credit Agreement

On August 15, 2022, the Company entered into a new unsecured credit agreement (the "2022 Credit Agreement").

The 2022 Credit Agreement provides for borrowings consisting of (i) a multi-currency revolving credit facility, providing for an equivalent in U.S.

dollars of up to $ 1.5 billion (the “Revolving Credit Facility”) and (ii) a $ 250 million delayed draw term loan facility (the “Delayed Draw Term Loan”), all pursuant to the terms and conditions of the 2022 Credit Agreement.

The 2022 Credit Agreement allows the Company to request, at prevailing market rates, an aggregate amount not to exceed $ 750 million, (a) increases to the borrowing commitments under the Revolving Credit Facility and/or (b) new incremental term loan commitments.

Under the 2025 Term Credit Agreement, the Company has agreed to maintain the same Interest Coverage Ratio and Leverage Ratio as the 2025 Credit Agreement.

The borrowing rate for the agreement is a variable rate assessed periodically in accordance with the terms of the agreement.

At December 31, 2025, the interest rate was 4.7 %.

On April 23, 2025, the Company entered into a new unsecured amended and restated credit agreement (the "2025 Credit Agreement"), which amended and restated the 2022 Credit Agreement and refinanced the 2024 Credit Agreement.

The 2025 Credit Agreement provides for borrowings consisting of (i) a multi-currency revolving credit facility for a U.S.

dollar equivalent of up to $ 2.0 billion (the "Revolving Credit Facility") and (ii) a delayed draw term loan facility of $ 725 million (the "Term Loan Facility"), all pursuant to the terms and conditions of the 2025 Credit Agreement.

The Term Loan Facility was utilized to refinance outstanding borrowings on the 2022 and 2024 credit agreements.

During the third quarter of 2025, the remaining $ 250 million under the Term Loan Facility was drawn and utilized as part of funding for the Inspection Technologies acquisition.

The 2025 Credit Agreement includes an incremental facility that allows the Company to request, at prevailing market rates, an aggregate amount not to exceed $ 1.0 billion, (a) increases to the borrowing commitments under the Revolving Credit Facility and/or (b) new incremental term loan commitments (the "Incremental Facility").

The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.

The Revolving Credit Facility matures on August 15, 2027.

The Delayed Draw Term Loan was fully drawn during the third quarter of 2023, and the proceeds were utilized to redeem the 4.375 % Senior Notes, due 2023.

Borrowings under the Delayed Draw Term Loan will mature on August 15, 2027.

Amounts borrowed and repaid under the Delayed Draw Term Loan may not be reborrowed.

The applicable interest rate for borrowings under the 2022 Credit Agreement includes a base rate (per the Interest Election terms of the agreement) plus an interest rate spread up to 1.75 % based on the lower of the pricing corresponding to (i) the Company’s financial leverage or (ii) the Company’s public rating.

At December 31, 2024, the interest rate on the Delayed Draw Term Loan was 6.0 % and the interest rate on the undrawn Revolving Credit Facility was 5.7 %.

Obligations under the 2022 Credit Agreement have been guaranteed by certain of the Company’s subsidiaries.

The Revolving Credit Facility matures on April 23, 2030.

The Term Loan Facility was fully drawn at December 31, 2025, and all borrowings mature on April 23, 2030.

Amounts borrowed and repaid under the Term Loan Facility may not be reborrowed.

The applicable interest rate for borrowings under the 2025 Credit Agreement includes a base rate (per the Interest Election terms of the agreement) plus an interest rate spread up to 1.75 % based on the lower of the pricing corresponding to (i) the Company's financial leverage or (ii) the Company's public credit rating.

At December 31, 2025, the interest rate on the Term Loan Facility was 5.5 %, and the interest rate on the undrawn Revolving Credit Facility was 4.9 %.

Obligations under the 2025 Credit Agreement have been guaranteed by certain of the Company’s subsidiari es.

Under the 2025 Credit Agreement, the Company has agreed to maintain an Interest Coverage Ratio of at least 3.0 to 1.0, and a Leverage Ratio not to exceed 3.5 to 1.0.

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The following table presents availability under the 2025 Credit Agreement as of December 31, 2025:

In millions Revolving Credit Facility Delayed Draw Term Loan Total

In millions Revolving Credit Facility Term Loan Facility Total

Maximum Availability $ 2,000 $ 725 $ 2,725

2 unchanged sentences

Current Availability $ 2,000 $ — $ 2,000

The Company was in compliance with all financial covenants in the 2022 Credit Agreement and the 2024 Credit Agreement as of December 31, 2024.

The Company was in compliance with all financial covenants in the 2025 Credit Agreement and the 2025 Term Credit Agreement as of December 31, 2025.

Intra-Quarter Uncommitted Money Market Line Credit Agreement

1 unchanged sentence

The Company or its subsidiaries may issue senior notes from time to time.

These notes are comprised of our 4.15 % Senior Notes which matured in 2024 (the "2024 Notes"), 3.20 % Senior Notes due 2025 (the "2025 Notes"), 3.45 % Senior Notes due 2026 (the "2026 Notes"), 1.25 % Senior Notes (EUR) due 2027 (the "Euro Notes" discussed below), 4.70 % Senior Notes due 2028 (the "2028 Notes") and 5.611 % Senior Notes due 2034 (the "2034 Notes").

These notes are comprised of our 3.45 % Senior Notes due 2026 (the "2026 Notes"), 1.25 % Senior Notes (EUR) due 2027 (the "Euro Notes"), 4.70 % Senior Notes due 2028 (the "2028 Notes"), 4.90 % Senior Notes due 2030 (the "2030 Notes"), 5.611 % Senior Notes due 2034 (the "2034 Notes"),

and 5.50 % Senior Notes due 2035 (the "2035 Notes").

The 2026 Notes, 2028 Notes, 2030 Notes, 2034 Notes, and 2035 Notes are the “US Notes”, and collectively with the Euro Notes, the “Senior Notes.” Interest on the US Notes is payable semi-annually and interest on the Euro Notes is paid annually.

Each series of the Senior Notes may be

redeemed any time in whole or from time to time in part in accordance with the provisions of the indenture, under which such series of notes was issued.

Each series of the Senior Notes may be redeemed any time in whole or from time to time in part in accordance with the provisions of the indenture, under which such series of notes was issued.

Each of the Senior Notes may be redeemed at a redemption price of 100 % of the principal amount plus a specified make-whole premium and accrued interest.

The US Notes and the Company's guarantee of the Euro Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and senior to all existing and future subordinated indebtedness of the Company.

On March 11, 2024, the Company issued $ 500 million of 5.611 % Senior Notes due in 2034 (2034 Notes).

The US Notes and the Company's guarantee of the Euro Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and are senior to all existing and future subordinated indebtedness of the Company.

On May 29, 2025, the Company issued (i) $ 500 million of 4.90 % Senior Notes due 2030 and (ii) $ 750 million of 5.50 % Senior Notes due 2035.

The 2030 Notes and 2035 Notes were issued at approximately 100 % of face value, and the Company recognized approximately $ 12 million of total deferred financing costs.

Interest on the 2030 Notes and 2035 Notes will accrue at a rate of 4.90 % and 5.50 %, respectively, per year, payable semi-annually on May 29 and November 29 of each year, commencing November 29, 2025.

The 2030 Notes will mature on May 29, 2030, and the 2035 Notes will mature on May 29, 2035.

Proceeds from the 2030 Notes and cash on hand were utilized to repay the outstanding amount of 3.20 % Senior Notes due 2025 at maturity.

Proceeds from the 2035 Notes were utilized as part of funding for the Inspection Technologies acquisition, which closed July 1, 2025.

On March 11, 2024, the Company issued $ 500 million of 5.611 % Senior Notes due in 2034.

The 2034 Notes were issued at 100 % of face value and the Company recognized approximately $ 5 million of total deferred financing costs.

Interest on the 2034 Notes will accrue at a rate of 5.611 % per year, payable semi-annually on March 11 and September 11 of each year, commencing September 11, 2024.

Interest on the 2034 Notes accrues at a rate of 5.611 % per year, payable semi-annually on March 11 and September 11 of each year, commencing September 11, 2024.

The 2034 Notes will mature on March 11, 2034.

Proceeds from the 2034 Notes, combined with the proceeds from the term loan under the 2024 Credit Agreement and cash on hand, were utilized to repay the outstanding amount of 2024 Notes at maturity.

Beginning September 15, 2023, the effective interest rates for the 2024 Notes and the 2028 Notes were each reduced by 0.25 % due to a favorable change in Wabtec's corporate credit rating and the rating of the aforementioned notes.

During the second quarter of 2022, the Company redeemed $ 25 million of principal from the 2024 Notes plus a premium and the related accrued interest.

Proceeds from the 2034 Notes, combined with the proceeds from the term loan under the 2024 Credit Agreement and cash on hand, were utilized to repay the outstanding amount of our 4.15 % Senior Notes due 2024 (the "2024 Notes") at maturity.

Beginning September 15, 2023, the effective interest rate for the 2028 Notes was reduced by 0.25 % due to a favorable change in Wabtec's corporate credit rating and the rating of the aforementioned notes.

The indentures under which the Senior Notes were issued contain covenants and restrictions which limit, subject to certain exceptions, certain sale and leaseback transactions with respect to principal properties, the incurrence of secured debt without equally and ratably securing the Senior Notes, and certain merger and consolidation transactions.

1 unchanged sentence

The US Notes are fully and unconditionally guaranteed, jointly and severally, on an unsecured basis by each of the Company's subsidiaries that is a guarantor under the 2025 Credit Agreement.

The Euro Notes were issued by Wabtec Netherlands and are fully and unconditionally guaranteed by the Company.

The Euro Notes were issued by Wabtec Transportation Netherlands B.V.

and are fully and unconditionally guaranteed by the Company.

The Company is in compliance with the restrictions and covenants in the indentures under which the Senior Notes were issued and expects that these restrictions and covenants will not be any type of limiting factor in executing our operating activities.

Wabtec aggregates the Company's domestic cash position on a daily basis.

Outside the United States, the Company uses cash pooling arrangements with banks to help manage our liquidity requirements.

Outside the United States, the Company uses cash pooling arrangements with banks to help manage liquidity requirements.

In these pooling arrangements, Wabtec subsidiary “Participants” agree with a single bank that the cash balances of any of the pool Participants with the bank will be subject to a full right of set-off against amounts other Participants owe the bank, and the bank provides for overdrafts as long as the net overdraft balance for all Participants does not exceed an agreed-upon level.

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and international employees, primarily in the United Kingdom, Canada and Germany, which provide benefits of stated amounts for each year of service of the employee.

The Company uses a December 31 measurement date for the plans.

The following tables provide information regarding the Company’s significant defined benefit pension plans summarized by U.S.

The majority of these plans are frozen, and therefore, participants do not accrue additional benefits.

Retirement plan expenses are not material to the Company's results of operations.

Plan assets are primarily comprised of cash, equity security funds and debt security funds.

The following table provides summarized information regarding the Company's significant defined benefit pension plans by U.S.

and international components:

Obligations and Funded Status

International

In millions 2025 2024 2025 2024

Change in projected benefit obligation

Obligation at beginning of year $ ( 55 ) $ ( 29 ) $ ( 251 ) $ ( 236 )

Service cost — — ( 3 ) ( 3 )

Interest cost ( 3 ) ( 2 ) ( 11 ) ( 11 )

Employee contributions — — ( 1 ) ( 1 )

Plan settlements, curtailments and amendments — 1 1 1

Benefits paid 4 4 13 14

Acquisition — ( 29 ) — —

Actuarial gain (loss) 2 — 17 ( 5 )

Effect of currency rate changes — — 10 ( 10 )

Obligation at end of year $ ( 52 ) $ ( 55 ) $ ( 225 ) $ ( 251 )

Change in plan assets

Fair value of plan assets at beginning of year $ 55 $ 31 $ 211 $ 201

Actual return on plan assets 1 2 10 10

Employer contributions — — 5 6

Employee contributions — — 1 1

Benefits paid ( 4 ) ( 4 ) ( 13 ) ( 14 )

Settlements and other — — ( 1 ) ( 1 )

Acquisition — 26 — —

Effect of currency rate changes — — ( 9 ) 8

Fair value of plan assets at end of year $ 52 $ 55 $ 204 $ 211

Funded status

Fair value of plan assets

Benefit obligations ( 52 ) ( 55 ) ( 225 ) ( 251 )

Funded status $ — $ — $ ( 21 ) $ ( 40 )

Amounts recognized in the statement of financial position consist of:

Noncurrent assets $ — $ — $ 29 $ 13

Current liabilities — — ( 2 ) ( 2 )

Noncurrent liabilities — — ( 48 ) ( 51 )

Net amount recognized $ — $ — $ ( 21 ) $ ( 40 )

Amounts recognized in Accumulated other comprehensive loss, before tax at December 31, consist of:

Prior service cost — — ( 1 ) ( 1 )

Net actuarial loss ( 13 ) ( 14 ) ( 44 ) ( 64 )

Net amount recognized $ ( 13 ) $ ( 14 ) $ ( 45 ) $ ( 65 )

The aggregate accumulated benefit obligation for the U.S.

pension plans was $ 52 million and $ 55 million as of December 31, 2024 and 2023, respectively.

The aggregate accumulated benefit obligation for the international pension plans was $ 214 million and $ 241 million as of December 31, 2024 and 2023, respectively.

International

In millions 2024 2023

Information for pension plans with accumulated benefit obligations in excess of Plan assets:

Projected benefit obligation $ ( 74 ) $ ( 185 )

Accumulated benefit obligation ( 65 ) ( 178 )

Fair value of plan assets 25 133

Information for pension plans with projected benefit obligations in excess of plan assets:

Projected benefit obligation $ ( 79 ) $ ( 194 )

Accumulated benefit obligation ( 69 ) ( 185 )

Fair value of plan assets 29 141

Components of Net Periodic Benefit Costs

International

In millions 2024 2023 2022 2024 2023 2022

Service cost $ — $ — $ — $ 3 $ 3 $ 3

Interest cost 3 2 1 11 11 6

Expected return on plan assets ( 3 ) ( 2 ) ( 1 ) ( 11 ) ( 10 ) ( 12 )

Amortization of net loss — — 1 3 3 2

Settlement and curtailment gains recognized — ( 1 ) — — — ( 1 )

Net periodic benefit (income) cost $ — $ ( 1 ) $ 1 $ 6 $ 7 $ ( 2 )

Interest cost is recorded in Interest expense, net on the Consolidated Statements of Income.

Expected return on plan assets, Amortization of net loss, and Settlement and curtailment losses recognized are recorded within Other income, net on the Consolidated Statements of Income.

Service cost is considered a component of employee compensation and is recorded within Cost of sales or Selling, general and administrative expenses depending on the plan participants relative job function.

Amounts recognized in Other comprehensive income during 2024 for other changes in plan assets and benefit obligations are not material.

The amounts of net actuarial loss and prior service cost included in Other comprehensive loss expected to be recognized as components of periodic benefit costs in 2025 are not material.

The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed.

International

$ 51 $ 52 $ 210 $ 204

Discount rate 5.70 % 5.25 % 5.58 % 4.68 % 4.38 % 4.77 %

Expected return on plan assets 4.50 % 3.80 % 3.80 % 5.53 % 5.09 % 4.25 %

Rate of compensation increase 3.00 % 3.00 % 3.00 % 2.92 % 2.88 % 2.78 %

The discount rate is based on settling the pension obligation with high grade, high yield corporate bonds, and the rate of compensation increase is based on actual experience.

The expected return on plan assets is based on historical performance as well as expected future rates of return on plan assets considering the current investment portfolio mix and the long-term investment strategy.

Pension Plan Assets

The Company has established formal investment policies for the assets associated with our pension plans.

Objectives include maximizing long-term return at acceptable risk levels and diversifying among asset classes.

Asset allocation targets are based on periodic asset liability study results which help determine the appropriate investment strategies.

The investment policies permit variances from the targets within certain parameters.

The plan assets consist primarily of equity security funds, debt security funds, insurance contracts, and cash and cash equivalent investments.

The assets held in these funds are generally actively managed and are valued at the net asset value per share multiplied by the number of shares held as of the measurement

(See Note 17).

Plan assets by asset category at December 31, 2024 and 2023 are as follows:

International

In millions 2024 2023 2024 2023

Pension Plan Assets

Equity security funds $ 8 $ 3 $ 59 $ 56

Debt security funds 42 35 118 129

Insurance contracts — — 11 12

Cash and cash equivalents and other 2 17 16 14

Fair value of plan assets $ 52 $ 55 $ 204 $ 211

plan has a target asset allocation of 15 % equity securities and 85 % debt securities.

The International plan has a target asset allocation of 12 % equity securities, 24 % debt securities and 64 % in other investments.

Investment policies are determined by the respective Plan’s Pension Committee and set forth in its Investment Policy.

Rebalancing of the asset allocation occurs on a quarterly basis.

The Company’s defined benefit pension plan assets consist primarily of equity security funds, debt security funds, insurance contracts, and temporary cash and cash equivalent investments.

These investments are comprised of a number of investment funds that invest in a diverse portfolio of assets including equity securities, corporate and governmental bonds, and money markets.

Trusts are valued at the net asset value (“NAV”) as determined by their custodian.

NAV represents the accumulation of the unadjusted quoted close prices on the reporting date for the underlying investments divided by the total shares outstanding at the reporting dates.

The following tables summarize our pension plan assets measured at fair value on a recurring basis by fair value hierarchy level (See Note 17):

December 31, 2024

In millions NAV Level 1 Level 2 Level 3 Total

Equity $ — $ 8 $ — $ — $ 8

Debt Securities — 9 33 — 42

Cash and cash equivalents — 2 — — 2

International:

Equity 6 14 39 — 59

Debt Securities — 3 115 — 118

Insurance Contracts — — 3 8 11

Cash and cash equivalents and other — 6 10 — 16

Total $ 6 $ 42 $ 200 $ 8 $ 256

December 31, 2023

In millions NAV Level 1 Level 2 Level 3 Total

Equity $ — $ 3 $ — $ — $ 3

Debt Securities — 5 30 — 35

Cash and cash equivalents — 17 — — 17

International:

Equity 6 14 36 — 56

Debt Securities — 3 126 — 129

Insurance Contracts — — 4 8 12

Cash and cash equivalents and other — 6 8 — 14

Total $ 6 $ 48 $ 204 $ 8 $ 266

There were no material changes to the Level 3 assets during 2024 and 2023.

The Company’s funding methods are based on governmental requirements and differ from those methods used to recognize pension expense.

The Company does not expect material contributions to the international pension plans and does not expect to make a contribution to the U.S.

pension plan during 2025.

Benefit payments expected to be paid to plan participants are as follows:

In millions U.S.

International

Year ended December 31,

2025 $ 4 $ 15

Projected benefit obligation

$ ( 51 ) $ ( 52 ) $ ( 238 ) $ ( 225 )

Accumulated benefit obligation

$ ( 51 ) $ ( 52 ) $ ( 226 ) $ ( 214 )

Amounts recognized in the statement of financial position consist of:

$ — $ — $ 25 $ 29

Total liabilities

$ — $ — $ ( 54 ) $ ( 50 )

2030 through 2034 $ 20 $ 86

Defined Contribution Plans

The Company participates in certain defined contribution plans.

Costs of approximately $ 65 million were recognized during 2024 and $ 60 million and $ 55 million was recognized during 2023 and 2022, respectively.

The 401(k) savings plan is a participant directed defined contribution plan that holds shares of the Company’s stock as one of the investment options.

At December 31, 2024 and 2023, the plan held on behalf of its participants approximately 329,000 shares with a market value of $ 62 million, and approximately 355,000 shares with a market value of $ 45 million, respectively.

Benefit payments expected to be paid to plan participants for the U.S.

and international plans combined are expected to be approximately $ 20 million each year for the next 10 years.

The Company is responsible for filing consolidated U.S.

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The Company is responsible for paying the taxes relating to such returns, including any subsequent adjustments resulting from the redetermination of such tax liabilities by the applicable taxing authorities.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The amendments in this update required prospective changes to certain annual income tax disclosures and are effective for Wabtec's annual reporting periods beginning January 1, 2025.

As such, the impacted disclosures for 2025 are reflected below in accordance with the updated requirements.

These updates include specific categories and presentation within the income tax rate reconciliation and enhanced disaggregation of disclosures about income taxes paid and income tax expense, among other changes.

As allowed under the ASU, Wabtec has not applied these changes retroactively.

The amendments in this update did not affect the recognition, measurement, or financial statement presentation of income taxes.

The components of the income before income taxes for the Company’s domestic and foreign operations for the years ended December 31 are provided below:

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Federal 28 26 ( 50 )

State ( 8 ) 9 1

Foreign ( 9 ) 16 ( 9 )

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federal statutory rate $ 334 21.0 %

State and local income tax, net of federal income tax effect 24 1.5

Foreign tax effects 64 4.0

Effect of cross-border tax laws:

Foreign branch income 19 1.2

Foreign tax credits ( 48 ) ( 3.0 )

Other ( 10 ) ( 0.6 )

Nontaxable or nondeductible items 4 0.3

Changes in unrecognized tax benefits 17 1.0

Other adjustments ( 12 ) ( 0.8 )

Effective rate $ 409 25.7 %

The majority of State and local income tax, net of federal income tax effect for the year ended December 31, 2025 is attributable to state taxes in Illinois, Pennsylvania, California, and Texas.

For the year ended

In millions 2024 2023

federal statutory rate 21.0 % 21.0 %

State taxes 1.8 1.5

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Effective rate 24.3 % 24.5 %

The increase in effective tax rate from 2024 to 2025 was primarily due to changes in jurisdictional mix of earnings and the non-deductible loss generated from the divestiture of a business as part of the Portfolio Optimization initiative.

The decrease in effective tax rate from 2023 to 2024 was primarily due to changes in valuation allowances and audit closures, partially offset by a change in the jurisdictional mix of earnings and the non-recurrence of the non-taxable gain generated on the acquisition of LKZ in 2023.

The decrease in effective tax rate from 2022 to 2023 was primarily due to a change in mix of foreign earnings, changes in valuation allowances, and the non-taxable gain generated on the acquisition of LKZ.

On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law.

This act includes a new book minimum tax on certain large corporations and an excise tax on corporate stock buybacks among other provisions.

At this time, the Company does not believe the act will have a material impact on our consolidated financial position, results of operations, or cash flows.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law.

Among other provisions, this act includes permanently extending and modifying certain expiring provisions of the 2017 Tax Cuts and Jobs Act and immediate expensing of domestic research and development expenses.

The impacts of these provisions do not have a material impact on the consolidated financial statements.

Components of deferred tax assets and liabilities were as follows:

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Deferred revenue 127 93

Tax credit carry forwards 36 —

Net operating loss carry forwards 132 106

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As of December 31, 2025, the valuation allowance for certain deferred tax asset carryforwards was $ 57 million, primarily in the United States, South Africa, China and the Netherlands.

The decrease in valuation allowances in 2024 is primarily related to the sale of a business.

The Company has net operating loss carry-forwards in the amount of $ 438 million, of which $ 216 million are indefinite lived, $ 109 million expire within ten years and $ 113 million expire in various periods between December 31, 2036 to December 31, 2045.

As of December 31, 2024, the liability for income taxes associated with unrecognized tax benefits was $ 19 million, of which $ 18 million, if recognized, would favorably affect the Company’s effective income tax rate.

Components of cash taxes paid, net of refunds, were as follows:

For the year ended December 31,

In millions 2025

United States federal taxes

State taxes 22

Foreign taxes:

Kazakhstan 23

Other foreign jurisdictions 76

Income taxes paid, net of amounts refunded $ 342

Income taxes paid, net of amounts refunded for the years ended December 31, 2024 and 2023, were $ 237 million and $ 233 million, respectively.

As of December 31, 2025, the liability for income taxes associated with unrecognized tax benefits was $ 29 million, of which $ 18 million, if recognized, would favorably affect the Company’s effective income tax rate.

As of December 31, 2024, the liability for income taxes associated with unrecognized tax benefits was $ 19 million, of which $ 18 million, if recognized,

would favorably affect the Company’s effective income tax rate.

A reconciliation of the beginning and ending amount of the gross liability for income taxes associated with unrecognized tax benefits follows:

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The Company includes interest and penalties related to unrecognized tax benefits in income tax expense.

As of December 31, 2024 and 2023, the total interest and penalties accrued was approximately $ 13 million.

As of December 31, 2025 and 2024, the total interest and penalties accrued was approximately $ 19 million and $ 13 million, respectively.

An audit of the Company’s U.S.

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and foreign taxing authorities for years before 2020.

At this time, the Company believes that it is reasonably possible that unrecognized tax benefits of approximately $ 14 million may change within the next 12 months due to the expiration of statutory review periods and current examinations.

EARNINGS PER SHARE

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Under the Directors Plan, options issued become exercisable over a three-year vesting period and expire ten years from the date of grant, and restricted stock issued under the plan vests one year from the date of grant.

The amount of restricted stock issued to non-employee directors as compensation for directors’ fees was as follows:

The amount of restricted stock

issued to non-employee directors as compensation for directors’ fees was as follows:

7,861 shares for 2025;

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Stock-based compensation expense for all of the plans was $ 94 million, $ 85 million and $ 59 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Associated tax benefits related to the stock-based compensation plans for the years ended December 31, 2024, 2023 and 2022 were not material.

Associated tax benefits related to the stock-based compensation plans were approximately $ 11 million for the year ended December 31, 2025 and not material for the years ended December 31, 2024 and 2023.

Included in the stock-based compensation expense for 2025 above is $ 46 million of expense related to incentive stock units, $ 32 million of expense related to non-vested restricted stock, $ 14 million related to restricted stock units, and $ 2 million related to units issued for Directors’ fees.

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ACCUMULATED OTHER COMPREHENSIVE LOSS

Comprehensive income (loss) comprises both Net income and the Other Comprehensive (loss) income resulting from the change in equity from transactions and other events and circumstances from non-owner sources.

The changes in Accumulated other comprehensive loss by component, net of tax, for the years ended December 31, 2024, 2023, and 2022 are as follows:

Comprehensive income (loss) comprises both Net income and the Other Comprehensive income (loss) resulting from the change in equity from transactions and other events and circumstances from non-owner sources.

The changes in Accumulated other comprehensive loss by component, including any tax impacts, for the years ended December 31, 2025, 2024, and 2023 are as follows:

In millions Foreign currency translation Derivative contracts Pension and post retirement benefit plans Total

Balance at December 31, 2022 $ ( 596 ) $ ( 9 ) $ ( 56 ) $ ( 661 )

Other comprehensive (loss) income before reclassifications ( 200 ) ( 4 ) 7 ( 197 )

Amounts reclassified from Accumulated other comprehensive loss — — 2 2

Other comprehensive (loss) income, net ( 200 ) ( 4 ) 9 ( 195 )

Balance at December 31, 2022 $ ( 596 ) $ ( 9 ) $ ( 56 ) $ ( 661 )

Other comprehensive income (loss) before reclassifications 55 16 ( 2 ) 69

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Balance at December 31, 2024 $ ( 818 ) $ 17 $ ( 45 ) $ ( 846 )

Amounts reclassified from Accumulated other comprehensive loss are recognized in "Other income, net" with the tax impact recognized in "Income tax expense" on the Consolidated Statements of Income.

Other comprehensive income (loss) before reclassifications 229 6 ( 5 ) 230

Amounts reclassified from Accumulated other comprehensive loss — ( 2 ) 2 —

Other comprehensive income (loss), net 229 4 ( 3 ) 230

Balance at December 31, 2025 $ ( 589 ) $ 21 $ ( 48 ) $ ( 616 )

Amounts included under Derivative contracts related to interest rate hedges reclassified from Accumulated other comprehensive loss are recognized in "Interest expense, net" with the tax impact recognized in "Income tax expense" on the Consolidated Statements of Income.

All other amounts reclassified from Accumulated other comprehensive loss are recognized in "Other income, net" with the tax impact recognized in "Income tax expense" on the Consolidated Statements of Income.

The Company leases certain property, buildings and equipment.

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The Senior Notes are considered Level 2 based on the fair value valuation hierarchy.

Contingent consideration related to the GE Transportation acquisition was considered Level 3 based on the fair value valuation hierarchy.

At December 31, 2023, $ 42 million was classified as "Other accrued liabilities" on the Company's Consolidated Balance Sheets, which approximates fair value.

There was no contingent consideration outstanding at December 31, 2024.

Hedging Activities In the normal course of business, the Company is exposed to market risks related to interest rates, commodity prices and foreign currency exchange rate fluctuations, which may adversely affect our operating results and financial position.

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We do not use derivatives for trading or speculative purposes.

Foreign Currency Exchange Risk

The Company uses forward contracts to hedge forecasted foreign currency denominated sales of finished goods and future settlement of foreign currency denominated assets and liabilities.

Derivatives used to hedge firm commitments relevant to sales and purchases and forecasted transactions to be realized with high probability that meet the criteria for hedge accounting are designated as cash flow hedges.

The effective portion of gains and losses is deferred as a component of Accumulated other comprehensive loss and is recognized in earnings at the time the hedged item affects earnings, in the same line item as the underlying hedged item.

For the years ended December 31, 2024, 2023 and 2022, the amounts reclassified into income were not material.

The Company has also established balance sheet risk management and net investment hedging programs to protect its balance sheet against foreign currency exchange rate volatility.

The Company may use interest rate hedge contracts on certain investing and borrowing transactions to manage its net exposure to interest rate changes and to manage its overall cost of borrowing.

The Company may also use commodity forward swaps to manage its exposure to commodity price changes and to reduce its overall cost of manufacturing.

The Company has established balance sheet risk management and net investment hedging programs to protect its balance sheet against foreign currency exchange rate volatility.

We conduct our business worldwide in U.S.

dollars and the functional currencies of our foreign subsidiaries, including euro, Indian rupee, British pound sterling, Australian dollars, Brazilian real, Kazakhstani tenge, and several other foreign currencies.

dollars and the functional currencies of our foreign subsidiaries, including euro, Indian rupee, British pound sterling, Australian dollars, Canadian dollars, Brazilian real, Kazakhstani tenge, and several other foreign currencies.

Changes in these foreign currency exchange rates could have a material adverse impact on our financial results that are reported in U.S.

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These programs reduce but do not eliminate foreign currency exchange rate risk entirely.

The Company enters into certain derivative contracts in accordance with its risk management strategy that do not meet the criteria for hedge accounting, but which have the impact of largely mitigating foreign currency exposure.

These foreign exchange contracts are accounted for on a full mark-to-market basis through earnings, with gains and losses recorded as a component of Other income, net.

The net gains and losses related to these contracts were not material for the years ended December 31, 2024, 2023 and 2022.

These contracts typically mature within one year .

Interest Rate Risk

The Company may use interest rate hedge contracts on certain investing and borrowing transactions to manage its net exposure to interest rate changes and to manage its overall cost of borrowing.

The Company does not use leveraged swaps and, in general, does not leverage any of its investment activities that would put principal capital at risk.

During the first quarter of 2024, the Company utilized all outstanding interest rate hedge contracts to help manage interest expense for the 2034 Notes issued in the first quarter of 2024.

In the third quarter of 2024, the Company entered into new interest rate hedge contracts to manage interest rate risk for a portion of future expected debt transactions.

For the years ended December 31, 2024, 2023 and 2022, the amounts reclassified into income were not material.

Commodity Price Risk

The Company may use commodity forward swaps to manage its exposure to commodity price changes and to reduce its overall cost of manufacturing.

For the years ended December 31, 2024, 2023 and 2022, the amounts reclassified into income were not material.

The following table summarizes the assets, liabilities, gross notional amounts, fair values, and fair value hierarchy classification of the designated and non-designated hedges discussed in the above sections as of December 31, 2024, which are

included in Other current assets and liabilities on the Consolidated Balance Sheets:

Fair Value Gross Notional Amount

In millions Level Designated Non-Designated Designated Non-Designated

Foreign Exchange Contracts

Other current assets 2 $ 5 $ 1 $ 387 $ 153

Other current liabilities 2 ( 4 ) ( 1 ) 182 44

Interest Rate Contracts

Other current assets 2 2 — 40 —

Total $ 3 $ — $ 609 $ 197

Fair Value Gross Notional Amount

In millions Level Designated Non-Designated Designated Non-Designated

Foreign Exchange Contracts

Other current assets 2 $ 6 $ 3 $ 319 $ 110

Other current liabilities 2 ( 12 ) ( 3 ) 655 200

Interest Rate Contracts

Other current assets 2 10 — 250 —

Total $ 4 $ — $ 1,224 $ 310

Net gains and losses related to the Company's hedging activities, except as described below, were not material for the years ended December 31, 2025, 2024 and 2023.

In connection with the acquisitions of Frauscher and Dellner Couplers, the Company entered into foreign exchange contracts for a notional value of € 1,290 million to mitigate foreign currency exposure of the purchase prices.

As part of the acquisition of Frauscher, the Company utilized foreign exchange forward contracts with a notional value of € 690 million.

The contracts are not designated as accounting hedges under Topic 815 of ASC, and as such, the gains and losses are recorded as a component of Other income, net.

For the year ended December 31, 2025 these contracts resulted in a net gain of $ 19 million.

At December 31, 2025, the Company had a total gross notional amount of designated and non-designated derivatives of $ 467 million and $ 1.355 billion, respectively.

At December 31, 2024, the Company had a total gross notional amount of designated and non-designated derivatives of $ 609 million and $ 197 million, respectively.

The related assets and liabilities at both December 31, 2025 and 2024 were not significant.

COMMITMENTS AND CONTINGENCIES

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company, sued the Company in the U.S.

District Court for the District of Delaware asserting antitrust, breach of contract, unfair competition law, and misrepresentation claims.

The complaint challenges the Wabtec-GE Transportation merger and contends that since the merger, Wabtec has unlawfully monopolized the markets for long-haul freight locomotives, Tier IV long-haul freight locomotives, and energy management systems by, among other things, failing to ensure that Progress’ products are interoperable with Wabtec’s locomotives and cab electronics.

District Court for the District of Delaware asserting antitrust, breach of contract, unfair competition law, defamation and false advertising claims.

The complaint challenges the Wabtec-GE Transportation merger and contends that since the merger, Wabtec has unlawfully monopolized the markets for long-haul freight locomotives, Tier IV

long-haul freight locomotives and energy management systems by, among other things, failing to ensure that Progress’ products are interoperable with Wabtec’s locomotives and cab electronics.

Progress seeks an order requiring Wabtec to divest GE Transportation, unspecified treble damages for its alleged lost profits from reduced sales of locomotive and cab systems and attorneys’ fees and costs.

It also asks the court to enjoin Wabtec from engaging in the conduct and require the Company to comply with its agreements with Progress.

Wabtec intends to vigorously defend itself against this lawsuit and believes that it has meritorious defenses to the claims asserted by Progress.

The case is still at an early stage;

Wabtec filed a motion to dismiss, briefing on this motion was completed in early 2024.

The Court has not yet issued a decision on Wabtec’s motion.

Xorail, Inc., a wholly owned subsidiary of the Company (“Xorail”), has received notices from Denver Transit Constructors (“DTC”) alleging breach of contract related to the operating of constant warning wireless crossings, and late delivery of the Train Management & Dispatch System (“TMDS”) for the Denver Eagle P3 Project, which is owned by the Denver Regional Transit District ("RTD").

No damages have been asserted for the alleged late delivery of the TMDS, and no formal claim has been filed;

Xorail has successfully completed a remediation plan concerning the TMDS issues.

With regard to the wireless crossing issue, as of September 8, 2017, DTC alleged that total damages were $ 37 million through July 31, 2017

and were continuing to accumulate.

The majority of the damages stems from a delay in approval of the wireless crossing system by the Federal Railway Administration ("FRA") and the Public Utility Commission ("PUC"), resulting in the use of flaggers at all of the crossings pending approval of the wireless crossing system and certification of the crossings.

DTC has alleged that the delay is due to Xorail's failure to achieve constant warning times for the crossings in accordance with the approval requirements imposed by the FRA and PUC.

Xorail has denied DTC's assertions, stating that its system satisfied the contractual requirements.

Xorail has worked with DTC to modify its system and implement the FRA's and PUC's previously undefined approval requirements;

the FRA and PUC have both approved modified wireless crossing system, and as of August 2018, DTC completed the process of certifying the crossings and eliminated the use of flaggers.

DTC has not updated its claim notices against Xorail, nor have they filed any formal claim against Xorail.

On September 21, 2018, DTC filed a complaint against RTD in Colorado state court for breach of contract related to non-payments and the costs for the flaggers, asserting a change-in-law arising from the FRA/PUC’s new certification requirements.

DTC's claim against RTD proceeded to trial on September 21, 2020.

On February 10, 2023, the court issued a decision in favor of RTD, denying DTC's damages claim.

DTC filed an appeal to the Colorado Court of Appeals;

on May 13, 2024, the Court of Appeals upheld the trial Court’s decision in favor of RTD;

DTC filed a Writ of Certiorari with the Colorado Supreme Court seeking another appeal;

the Writ was denied on February 4, 2025.

DTC has informally indicated that they intend to send an updated claim notice to Xorail.

On June 12, 2025, in response to a motion filed by Wabtec, the Court dismissed the antitrust claims against Wabtec saying that no harmful effects on competition resulting from the merger had been shown.

Progress Rail subsequently filed an amended Complaint seeking to revive its antitrust claims.

Wabtec filed another motion to dismiss the antitrust claims, which is still pending before the Court.

The Court did not dismiss the alleged breach of contract, unfair competition, defamation and false advertising claims.

Wabtec is vigorously defending those remaining claims and a trial on those claims is currently scheduled to begin on February 23, 2026.

As previously disclosed, Xorail, Inc., a wholly owned subsidiary of the Company (“Xorail”), received notices from Denver Transit Constructors (“DTC”) alleging breach of contract related to the operation of a wireless crossing system provided by Xorail for use by the Denver Regional Transit District ("RTD").

DTC's alleged damages stemmed from a delay in approval of the wireless crossing system by regulatory authorities, which resulted in the interim use of flaggers at the crossings.

Xorail denied DTC's assertions, stating that the system satisfied the contractual requirements.

In December 2025, DTC and Xorail agreed to settle all of DTC's claims.

The settlement was not material to the Company's operating results or cash flows.

From time to time the Company is involved in litigation relating to claims arising out of its operations in the ordinary course of business.

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The key factors used to identify these reportable segments are the organization and alignment of the Company’s internal operations, the nature of the products and services and customer type.

The Company’s business segments are:

Freight Segment builds, rebuilds, upgrades, and overhauls locomotives, services locomotives and freight cars, and provides a range of component and digital solutions for customers in the freight and transit rail, mining, and marine industries.

The Freight Segment builds, rebuilds, upgrades, and overhauls locomotives, services locomotives and freight cars, and provides a range of component and digital solutions for customers in the freight and transit rail, mining, and marine industries.

It also manufactures and services components for new and existing freight cars and locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, maintenance of way, and provides heat exchange and cooling systems for locomotives and power generation equipment.

Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities, and also serves companies in the mining, marine, and industrial markets.

We refer to sales of both goods, such as spare parts and equipment upgrades, and related services, such as monitoring, maintenance and repairs, as sales in our Services product line.

Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically regional trains, high speed trains, subway cars, light-rail vehicles and buses.

The Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically regional trains, high speed trains, subway cars, light-rail vehicles and buses.

It also refurbishes subway cars and provides heating, ventilation, and air conditioning equipment and doors for buses and subway cars.

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Corporate activities include general corporate expenses, elimination of certain intersegment transactions, interest income and expense and other unallocated charges.

Segment assets for the Freight and Transit Segment include assets directly utilized for segment operations, as well as the related goodwill and intangible assets.

Segment assets for the Freight and Transit Segments include assets directly utilized for segment operations, as well as the related goodwill and intangible assets.

Corporate segment assets include cash, cash equivalents, and restricted cash, equity method investment assets, certain tax assets, receivables held by our bankruptcy-remote facility, pension assets, corporate headquarters' assets and other asset balances that are managed outside of operating segments.

During 2024, management changed the presentation of segment assets below to show intercompany balances eliminated.

As such, segment assets for 2023 have been updated to conform to the current period presentation.

Cost of sales for both segments represents costs directly related to manufacturing products and providing services.

Primary costs include raw materials, direct labor, overhead, shipping and handling, warehousing, and the depreciation of

manufacturing, warehousing and distribution facilities.

Primary costs include raw materials, direct labor, overhead, shipping and handling, warehousing, and the depreciation of manufacturing, warehousing and distribution facilities.

Selling, general and administrative expenses for both segments represent costs incurred in managing the business, including salary, benefits, professional fees and operating costs associated with each segment’s non-manufacturing activities.

The amounts of depreciation and amortization disclosed by reportable segment are included within their respective segment expense captions, such as Cost of sales, Selling, general & administrative expenses and Amortization expense.

During 2024, Company management determined that certain parts of the business would be better aligned with management oversight in different product lines.

These changes were immaterial to the individual product lines and segments affected, and historical amounts have been reclassified to conform to the current period presentation.

During the first quarter of 2025, Company Management determined that certain businesses within the Services product line would be better aligned with Management oversight in the Components product line.

As such, Sales by product line for 2024 and 2023 have been recast to conform to the current period presentation.

These changes were within the Freight Segment and had no impact on Total Freight Segment Sales, Gross profit, or Income from operations.

Segment financial information for 2025 is as follows:

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South America 513 445 346 54 40

Germany 371 347 339 54 54

France 419 369 346 72 59

Germany 379 371 347 73 54

United Kingdom 313 296 248 43 33

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India 699 579 593 125 119

Kazakhstan / CIS 559 457 399 34 39

Australia / New Zealand 453 481 451 18 16

Kazakhstan / CIS 431 559 457 37 34

China 297 242 286 25 25

Other Asia / Middle East 300 258 240 6 —

Egypt 28 120 164 — —

Other Africa 166 109 119 3 3

Africa 326 194 229 3 3

Total $ 11,167 $ 10,387 $ 9,677 $ 1,616 $ 1,447

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Digital Intelligence 1,030 786 773

Total Freight Segment sales $ 7,468 $ 6,923 $ 5,979

Total Freight Segment $ 8,036 $ 7,468 $ 6,923

Transit Segment:

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Aftermarket 1,738 1,611 1,490

Total Transit Segment sales $ 2,919 $ 2,754 $ 2,383

Total Transit Segment $ 3,131 $ 2,919 $ 2,754

OTHER INCOME, NET

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In millions 2025 2024 2023

Foreign currency (loss) gain $ ( 19 ) $ ( 20 ) $ 6

Foreign currency loss $ ( 6 ) $ ( 19 ) $ ( 20 )

Net gain on mark-to-market derivatives 19 — —

Equity income 2 8 25

Expected return on pension assets/amortization 11 11 7

Other miscellaneous income (expense) 2 32 ( 1 )

Other miscellaneous (expense) income ( 2 ) 2 32

Total Other income, net $ 24 $ 2 $ 44

In connection with the completed acquisition of Frauscher and announced definitive agreement to acquire Dellner Couplers, the Company entered into foreign exchange contracts for a notional value of € 1,290 million to mitigate foreign currency exposure of the purchase price.

As part of the acquisition of Frauscher, the Company utilized foreign exchange forward contracts with a notional value of € 690 million.

The contracts are not designated as accounting hedges under Topic 815 of ASC, and as such, the gains and losses are recorded as a component of Other income, net.

For the year ended December 31, 2025, these contracts resulted in a net gain of $ 19 million.

See Note 3 for additional information.

RESTRUCTURING

During the first quarter of 2022, Wabtec announced a multi-year strategic initiative (“Integration 2.0”) to review and consolidate our operating footprint, reduce headcount, streamline the end-to-end manufacturing process, restructure the North America distribution channels, expand operations in low-cost countries, and simplify the business through systems enablement.

Through this initiative, Management has evaluated additional capital investments to further simplify and streamline the business.

The Company now anticipates that it will incur one-time charges related to Integration 2.0 up to approximately $ 170 million.

Wabtec is focused on driving operational efficiency and improving profitability while reducing manufacturing complexity.

As a result, there are key strategic initiatives aimed at achieving these focus areas.

Integration 3.0

Integration 3.0 is a multi-year strategic initiative to further consolidate our footprint, reduce complexity and streamline manufacturing, engineering, administrative, and commercial activities.

The Company anticipates that it will incur one-time restructuring charges related to Integration 3.0 of approximately $ 80 million to $ 100 million.

Net charges to date of $ 36 million were primarily for employee-related costs.

A summary of restructuring charges related to the Integration 3.0 initiative is as follows:

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Selling, general and administrative expenses 10

Total Freight Segment $ 13

Transit Segment:

Cost of goods sold $ 6

Selling, general and administrative expenses 6

Total Transit Segment $ 12

Selling, general and administrative expenses $ 2

Total Integration 3.0 restructuring charges $ 27

For the year ended December 31, 2024, approximately $ 9 million of net charges were recorded, of which $ 3 million was in the Freight Segment and $ 6 million was in the Transit Segment.

Cash payments for the years ended December 31, 2025 and 2024 were not material.

Portfolio Optimization

Wabtec is focused on exiting various low margin product offerings through Portfolio Optimization to improve profitability while reducing manufacturing complexity.

Wabtec recorded net charges of approximately $ 45 million, $ 28 million

and $ 28 million for the years ended December 31, 2025, 2024 and 2023, respectively, primarily for asset write downs related to Portfolio Optimization.

During 2025, approximately $ 41 million was related to the Freight Segment and approximately $ 4 million was related to the Transit Segment.

Total one-time restructuring charges related to Portfolio Optimization to date are approximately $ 101 million.

Integration 2.0

Integration 2.0 is a multi-year strategic initiative to review and consolidate our operating footprint, reduce headcount, streamline the end-to-end manufacturing process, restructure the North America distribution channels, expand operations in low-cost countries, and simplify the business through systems enablement.

The Company anticipates that it will incur one-time charges related to Integration 2.0 up to approximately $ 170 million, of which approximately $ 149 million has been incurred to date.

There were no material charges or cash payments during the year ended December 31, 2025.

A summary of restructuring charges related to the Integration 2.0 initiative is as follows:

For the year ended

In millions 2024 2023

Freight Segment:

Cost of goods sold $ 7 $ 4

Selling, general and administrative expenses — 5

Other income, net ( 4 ) —

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Total Integration 2.0 restructuring charges $ 28 $ 49

Total charges related to Integration 2.0 to date are approximately $ 146 million which includes amounts recorded in the fourth quarter 2021 for similar actions in Europe.

Cash payments made during 2024 were approximately $ 48 million, primarily for employee related costs.

Cash payments made during 2023 were approximately $ 39 million.

In addition to Integration 2.0, Wabtec is focused on exiting various low margin product offerings through Portfolio Optimization to improve profitability while reducing manufacturing complexity.

Wabtec now expects to incur approximately $ 70 million in net exit charges related to Portfolio Optimization, which will be predominately non-cash asset write downs.

Total charges related to Portfolio Optimization to date are approximately $ 56 million, which includes approximately $ 28 million charged in 2024 and in 2023.

During 2024, approximately $ 18 million is related to the Freight Segment and approximately $ 10 million is related to the Transit Segment.

Charges are primarily related to asset write downs.

SUBSEQUENT EVENTS

On January 14, 2025, Wabtec announced a definitive agreement to acquire Evident’s Inspection Technologies division (Inspection Technologies), formerly part of the Scientific Solutions Division of Olympus Corporation, a global leader in Non-Destructive Testing, Remote Visual Inspection and Analytical Instruments solutions for mission critical assets, for $ 1.78 billion.

Upon acquisition, Inspection Technologies will be reported within the Digital Intelligence product line of the Freight Segment.

The Company anticipates financing the acquisition with a combination of cash on hand, utilization of the Revolving Credit Facility and an additional term loan.

The transaction is subject to customary closing conditions and regulatory approvals, with the Company expecting to finalize the acquisition of Inspection Technologies by the end of the first half of 2025.

Cash payments made during 2024 and 2023 were approximately $ 48 million and $ 39 million, respectively.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

1 unchanged sentence

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 8. Financial Statements and Supplementary Data