Railcar builder FreightCar America reported adjusted net income of $3.8 million, or $0.11 per share, in the second quarter, beating market estimates despite weaker revenue from lower deliveries. Revenue for the quarter totaled $118.6 million, with new railcar deliveries down to 939 units from 1,159 units year-over-year.

Gross margin for the quarter improved to 15% from 12.5% a year ago, resulting in a gross profit of $17.8 million. The company attributed margin improvement to more efficient production and managed pricing strategies amid volatile conditions. Company executives see a softer new railcar demand due to uncertainties around tariff policies.

FreightCar America received new orders for 1,226 railcars valued at $106.9 million, contributing to a backlog of 3,624 units valued at $316.9 million. The company reaffirmed its guidance for fiscal year 2025, projecting deliveries between 4,500 and 4,900 units, up 7.7% with revenue projected at $530 million to $595 million, up 0.6%.

Company executives are starting to see a softer new railcar demand environment due to uncertainties around tariff policies affecting customer order timing. They predict total industry deliveries in 2025 will fall below the previously expected 40,000 units per year average. FreightCar America’s earnings surpassed those of Trinity Industries and Greenbrier Cos., which both missed analyst expectations.

Nick Randall, President and Chief Executive, credited strong operational execution and healthy customer demand for the positive results. The company reported that despite broader market uncertainties, new orders and a robust backlog contributed to their success. FreightCar America is optimistic about the future, even amid uncertainties like tariff policies and potential mergers in the industry.

Read more at Yahoo Finance: Efficiencies, demand aid Freightcar America earnings