GATX CORP

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes and other information included elsewhere in this Quarterly Report, Annual Report on Form 10-K for the year ended December 31, 2024, and in our other filings with the Securities and Exchange Commission ("SEC"). We based the discussion and analysis that follows on financial data we derived from the financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and on certain other financial data that we prepared using non-GAAP components. For a reconciliation of these non-GAAP measures to the most comparable GAAP measures, see "Non-GAAP Financial Measures" at the end of this item. The discussion and analysis below includes forward-looking statements that are subject to risks, uncertainties and other factors described in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2024 that could cause actual results to differ materially from such forward-looking statements. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future.

OVERVIEW

We lease, operate, manage, and remarket long-lived, widely used assets, primarily in the rail market. We report our financial results through three primary business segments: Rail North America, Rail International, and Engine Leasing. Financial results for our tank container leasing business ("Trifleet") are reported in the Other segment.

Operating results for the nine months ended September 30, 2025 are not necessarily indicative of the results we may achieve for the entire year ending December 31, 2025. In particular, asset remarketing income does not occur evenly throughout the year. For more information, refer to the consolidated financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2024.

On May 29, 2025 GATX entered into a definitive agreement to acquire approximately 105,000 railcars from Wells Fargo Bank, N.A. ("Wells Fargo") for$4.4 billion through a newly formed joint venture with Brookfield Infrastructure Partners L.P. and its institutional partners (collectively, “Brookfield”). Initially, GATX's ownership share in the joint venture will be 30%, with Brookfield's share at 70%. GATX will have the option to acquire up to 100% of the joint venture equity over time. A portion of the purchase price will be financed by the joint venture in the form of debt financing. GATX will also directly purchase approximately 223 locomotives from Wells Fargo, and Brookfield will directly acquire Wells Fargo’s rail finance lease portfolio. GATX will serve as manager of the railcars in the joint venture as well as the finance lease portfolio directly owned by Brookfield.

On September 16, 2025, GATX announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in connection with the transaction, which followed clearance from the European Commission under the EU merger regulation in August 2025. Additionally, the legal mandatory waiting period under the Canadian Competition Act expired on September 24, 2025 and, on October 9, 2025, the parties received a no-action letter from the Commissioner of Competition indicating that he does not intend to challenge the transaction under the merger provisions of the Canadian Competition Act. Transaction approval is pending with additional regulatory agencies, following which the transaction is anticipated to close in the first quarter of 2026 or sooner, subject to customary closing conditions.

On September 23, 2025, GATX Rail Europe entered into a definitive agreement to acquire approximately 6,000 railcars from DB Cargo AG. The transaction is subject to customary closing conditions, including required regulatory approvals and clearances, and is expected to close in the fourth quarter of 2025.

Economic Conditions

GATX, and markets more broadly, are facing uncertainty around tariffs and economic conditions. These conditions did not have a significant impact on our business and financial results during the first nine months of 2025. However, a sustained slowdown in economic growth as a result of tariffs or global tensions could have a more significant impact on GATX’s financial results in the future. If this were to occur, GATX could be impacted directly and indirectly across all segments. Such conditions could lead to specific costs and inflationary pressures that directly impact GATX, including the impact of rising costs of new railcars and other transportation assets, increased maintenance expense, and general increases in other administrative expenses. GATX could also be indirectly impacted by factors such as softening demand for our products and services if customers within the markets or commodities we serve are impacted by tariffs or economic conditions. Management continues to monitor the macroeconomic environment to identify potential risks and to manage our business accordingly. However, we believe we are in a strong position to manage these risks. Our diverse fleet, broad global customer base, and long-term nature of our lease contracts provide substantial operating flexibility. In addition, our strong balance sheet position, credit ratings, and access to capital provide us adequate cash flow availability as needed.