WABASH NATIONAL Corp (WNC)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 revenue was $416.8M, GAAP diluted EPS was $(0.02), gross margin 10.3%, and operating margin 0.9%; Adjusted EBITDA was $21.1M (5.1% of sales), reflecting trough volumes and mix pressure .
• Backlog increased sequentially to ~$1.2B, with $813M expected to ship within 12 months, improving visibility into 2025 despite more evenly distributed dry van orders versus typical seasonality .
• 2025 guidance initiated: revenue $1.9–$2.1B (midpoint $2.0B), EPS $0.85–$1.05 (midpoint $0.95); Q1 2025 guide embeds seasonality with revenue $420–$450M and EPS $(0.20)–$(0.30) .
• Strategic focus on Parts & Services and Truck Bodies, digital enablement (Wabash Marketplace), and TaaS; management reiterated minimal direct tariff exposure and highlighted autonomous/logistics partnerships as potential catalysts .

What Went Well and What Went Wrong

• What Went Well

  • Backlog rose sequentially to ~$1.2B; 12‑month backlog climbed >$100M q/q to $813M, improving near‑term revenue conversion confidence .
  • Strategic progress: Preferred Partner Network expanded by 14 locations, strengthening aftermarket parts/service coverage; management emphasized building recurring revenue and digital capabilities (Wabash Marketplace) .
  • Management confidence in tariff resilience and supply reliability: “we have built quite a moat around the incoming supply tariff risk” and capacity to shift production domestically if needed .

• What Went Wrong

  • Volumes/margins compressed: sequential revenue fell to $416.8M (Q3: $464.0M; Q2: $550.6M), with Q4 gross margin 10.3% and operating margin 0.9%; Parts & Services margins were temporarily impacted by one‑off events in Q4 .
  • Legal overhang: the Missouri product liability verdict led to a $450M non‑cash charge in Q3; Q4 SG&A included an incremental ~$1M legal spend, and 2025 SG&A embeds elevated legal expenses .
  • Q1 seasonal air‑pocket ahead: management guided Q1 2025 revenue $420–$450M and EPS $(0.20)–$(0.30), indicating near‑term softness before expected intra‑year momentum rebuilds .

Financial Results

Sequential trend (Q2→Q3→Q4 2024)

YoY comparison (Q4 2023 → Q4 2024)

Segment breakdown (Q2→Q3→Q4 2024)

KPIs and operating metrics

Note: Consensus estimates from S&P Global were unavailable due to API limits; beat/miss vs estimates cannot be determined at this time.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• Strategy and resilience: “We continued to build on our record setting financial and strategic accomplishments of 2023 by demonstrating improved resilience… and continuing to invest in strategic growth…” .
• Digital and ecosystem: “Our goal… is to move beyond transactional relationships… to co‑create innovations larger than any one organization… Smart Crossroads with Purdue… Trailers as a Service partnership with Kodiak…” .
• 2025 demand mix: “We anticipate the strongest performance in 2025—Truck Bodies and Parts & Services… operate with relatively modest backlogs and convert orders to revenue quickly” .
• Tariffs positioning: “We have dramatically reduced our exposure… built quite a moat… capacity in domestic operations to shift production as needed” .
• Capital allocation: “Liquidity was $422M at year‑end; net leverage 1.7x; share count reduced ~6% in 2024 and 22% over five years; maintain dividend; evaluate buybacks and bolt-on M&A” .

Q&A Highlights

• Margin outlook vs guidance: FY25 margins tempered by higher variable comp and elevated legal expenses in SG&A; mix effects also weighed on Q4 .
• KPIs and inflection signals: Management tracking freight sub‑segments—seeing some turning positive vs last year—supporting “conservative optimism” for 2025 .
• Seasonality: Expect a gradual build through 2025; Q1 typical trough with modest carrier expectations; less fourth‑quarter tail‑off than 2024 .
• TaaS fleet and adoption: Fleet between 500–1,000 units; several new customers added in last 45 days; potential mid‑year capability announcements .
• Trailer pools: Concept remains valid and synergistic with TaaS; expected to gain traction as markets improve .

Estimates Context

• S&P Global consensus estimates for revenue and EPS for Q4 2024 and prior quarters were unavailable due to API request limits; as a result, we cannot determine beat/miss vs Wall Street consensus at this time. Values retrieved from S&P Global were unavailable; comparisons to estimates are not provided.

Key Takeaways for Investors

• Sequential backlog and 12‑month backlog growth underpin near‑term conversion despite atypical dry van seasonality; watch for intra‑year order accrual supporting H2 momentum .
• Near‑term air pocket: Q1 2025 EPS guide of $(0.20)–$(0.30) reflects seasonality and SG&A timing; sets a low bar for subsequent quarters if backlog converts .
• Mix pivot: 2025 growth emphasis on Parts & Services and Truck Bodies—faster conversion, higher structural margins; monitor margin recovery in P&S post Q4 one‑offs .
• Strategic moat on tariffs: Minimal direct exposure and domestic capacity flexibility reduce tariff risk; potential near‑shoring tailwind to dry van utilization .
• Legal overhang persists but is non‑cash to date; elevated legal SG&A embedded in 2025—track developments for potential upside if resolved favorably .
• Capital allocation discipline: Strong liquidity ($422M), ongoing dividend, opportunistic buybacks; increased strategic capex ($50–$60M) to scale growth platforms (Marketplace, TaaS) .
• Catalysts: Demonstrable P&S margin normalization, TaaS customer/feature announcements, H2 order strength, and clarity on legal outcome may drive re‑rating .