Knorr-Bremse posted a second-quarter operating EBIT margin of 14.2%, clearing the primary profitability objective of its BOOST strategy program ahead of the end-2026 deadline the company had set for it. The Munich-based braking systems supplier also raised full-year guidance and, in the same announcement, released mid-term targets under a new growth program called Growth Beyond. Figures for the quarter and first half are preliminary, with the full half-year report scheduled for release July 30, 2026.
Highlights
- Q2 operating EBIT margin of 14.2%, up 110 basis points year over year and above the BOOST target of more than 14% by the end of 2026
- Record order book of $9.03 billion (€7,887 million) as of June 30, 2026, a 7.7% increase
- Q2 free cash flow of $300 million (€262 million), up 79.9% from the prior-year quarter
- Q2 earnings per share of $1.24 (€1.08), a 24.1% increase
Second Quarter Carries the First Half
Second-quarter revenues reached $2.45 billion (€2,143 million), up 7.2% year over year, with the company reporting organic growth of 6.4%. Quarterly order intake climbed 4.5% to $2.52 billion (€2,202 million).
Across the first half, order intake of $5.07 billion (€4,431 million) came in 1.2% below the prior-year period, while consolidated revenues rose 3.1% to $4.67 billion (€4,080 million). Adjusted for currency effects, the company says the increase would have been 2.6%. Operating EBIT improved 13.7% to $648 million (€566 million), lifting the half-year operating EBIT margin 130 basis points to 13.9%. Free cash flow nearly doubled to $337 million (€294 million) on what Knorr-Bremse attributes to operational performance combined with improved working capital.
| Group | Q2 2026 | Q2 2025 | Δ | H1 2026 | H1 2025 | Δ |
|---|---|---|---|---|---|---|
| Order intake | 2,202 | 2,108 | +4.5% | 4,431 | 4,484 | -1.2% |
| Order book (June 30) | 7,887 | 7,326 | +7.7% | 7,887 | 7,326 | +7.7% |
| Revenues | 2,143 | 1,999 | +7.2% | 4,080 | 3,957 | +3.1% |
| Operating EBIT | 305 | 262 | +16.5% | 566 | 498 | +13.7% |
| Operating EBIT margin | 14.2% | 13.1% | +110 bp | 13.9% | 12.6% | +130 bp |
| Free cash flow | 262 | 146 | +79.9% | 294 | 160 | +82.9% |
| Earnings per share | 1.08 | 0.87 | +24.1% | 2.03 | 1.70 | +19.4% |
Figures in EUR millions except earnings per share, in EUR.
CFO Frank Weber tied the margin result directly to cost discipline: “With an operating EBIT margin of 14.2% in the second quarter, we have already exceeded our primary BOOST objective of achieving an operating EBIT margin of above 14% by the end of 2026. Our free cash flow also increased significantly, reaching € 262 million. This achievement reflects our strict cost management, structural improvements, and substantial efficiency gains.”
Rail Holds Margin, Truck Closes the Gap
The Rail division carried the higher margin, while the Truck division delivered the sharper improvement. Knorr-Bremse credits Truck’s gains primarily to improved cost structures supported by rising demand, with economies of scale from higher revenues feeding through to earnings.
| Division (H1 2026) | Order intake | Order book | Revenues | Operating EBIT | Operating EBIT margin |
|---|---|---|---|---|---|
| Rail | 2,399 (-7.7%) | 5,910 (+6.4%) | 2,245 (+3.5%) | 383 (+10.3%) | 17.1% (+110 bp) |
| Truck | 2,026 (+7.5%) | 1,979 (+11.7%) | 1,837 (+2.7%) | 214 (+21.5%) | 11.7% (+180 bp) |
Figures in EUR millions; changes versus H1 2025.
In dollar terms, Rail booked revenues of $2.57 billion and operating EBIT of $438 million, against Truck revenues of $2.10 billion and operating EBIT of $245 million.
What Comes After BOOST?
Portfolio restructuring formed part of BOOST, and the program’s divestment track continued days before the results: Knorr-Bremse concluded an agreement to sell its Merak rail HVAC business to OpenGate Capital on July 28, 2026, with closing subject to customary conditions and regulatory approvals and expected by the end of calendar year 2026.
Growth Beyond shifts the emphasis from transformation to expansion. The company says it will strengthen its core business and selectively enter growth areas where it can apply its industrial competencies in safety, quality, and reliability. CEO Marc Llistosella framed the 2030 ambition: “By 2030, we aim to generate approximately € 10 billion in revenue, increase our operating EBIT margin to around 16%, maintain a cash conversion rate above 90%, and deliver a return on capital employed of over 25%.” At current rates, that revenue target equates to roughly $11.45 billion.
Raised Guidance for 2026
Knorr-Bremse now expects fiscal 2026 revenues of $9.28 billion to $9.50 billion (€8,100 million to €8,300 million), narrowing the floor from the €8,000 million previously guided alongside its full-year 2025 results. The operating EBIT margin range moves to 14.0% to 14.5% from around 14%, and free cash flow guidance is set at $859 million to $973 million (€750 million to €850 million).
The outlook rests on the assumption that the crisis in the Middle East does not escalate or persist, particularly with respect to supply chain disruptions, and is based on the current portfolio plus the effects of the duagon acquisition. Full-year documentation will be available through the company’s Investor Relations section.
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