[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q) [Filing Details](index=1&type=section&id=Filing%20Details) Schneider National, Inc. filed this Quarterly Report on Form 10-Q for the period ended June 30, 2025, as a large accelerated filer, with 83,029,500 Class A and 92,233,497 Class B common shares outstanding as of July 24, 2025 - The report is a Quarterly Report on Form 10-Q for the period ended June 30, 2025[2](index=2&type=chunk) - Schneider National, Inc. is classified as a **large accelerated filer**[4](index=4&type=chunk) Common Stock Outstanding (as of July 24, 2025) | Class of Stock | Shares Outstanding | | :--------------- | :----------------- | | Class A Common | 83,029,500 | | Class B Common | 92,233,497 | [Glossary of Terms](index=4&type=section&id=GLOSSARY%20OF%20TERMS) [Key Definitions](index=4&type=section&id=Key%20Definitions) This section defines key industry terms and company-specific entities, including 3PL, GAAP, EBITDA, and various company names, to enhance report comprehension - The glossary defines industry-specific terms and company-specific entities to aid in understanding the report[10](index=10&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=5&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) [Forward-Looking Statements Disclaimer](index=5&type=section&id=Forward-Looking%20Statements%20Disclaimer) Forward-looking statements in this report are subject to risks from economic conditions, operational challenges, and regulatory changes, with no obligation for the company to update them - Forward-looking statements reflect current expectations and beliefs regarding future events and financial performance[12](index=12&type=chunk) - Key risks include unfavorable economic conditions (inflation, tariffs), operational challenges, competitive pressures, driver shortages, and volatility in investments[13](index=13&type=chunk) - The company does not undertake to publicly release any revision to its forward-looking statements[13](index=13&type=chunk) [Where to Find More Information](index=5&type=section&id=WHERE%20TO%20FIND%20MORE%20INFORMATION) [Information Availability](index=5&type=section&id=Information%20Availability) The company's SEC filings, including reports and proxy statements, are accessible on www.sec.gov and the 'Investors' section of Schneider's website - SEC filings are available on **www.sec.gov** and **www.schneider.com**[15](index=15&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [ITEM 1. Financial Statements](index=6&type=section&id=ITEM%201.%20Financial%20Statements) This section provides unaudited consolidated financial statements, including comprehensive income, balance sheets, cash flows, and shareholders' equity, with notes on accounting policies, acquisitions, and segment reporting [Consolidated Statements of Comprehensive Income (Unaudited)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) Consolidated Statements of Comprehensive Income (Unaudited) - Key Figures (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Operating revenues | $1,420.5 | $1,316.7 | $2,822.3 | $2,635.7 | | Total operating expenses| $1,365.5 | $1,265.7 | $2,725.2 | $2,556.0 | | Income from operations | $55.0 | $51.0 | $97.1 | $79.7 | | Net income | $36.0 | $35.3 | $62.1 | $53.8 | | Basic earnings per share| $0.21 | $0.20 | $0.35 | $0.31 | | Diluted earnings per share| $0.20 | $0.20 | $0.35 | $0.31 | - Operating revenues increased by **7.9%** for the three months ended June 30, 2025, and by **7.1%** for the six months ended June 30, 2025, compared to the respective prior periods[17](index=17&type=chunk) - Net income increased by **2.0%** for the three months ended June 30, 2025, and by **15.4%** for the six months ended June 30, 2025, compared to the respective prior periods[17](index=17&type=chunk) [Consolidated Balance Sheets (Unaudited)](index=7&type=section&id=Consolidated%20Balance%20Sheets%20(Unaudited)) Consolidated Balance Sheets (Unaudited) - Key Figures (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total current assets | $1,165.0 | $1,115.3 | | Net property and equipment | $2,846.7 | $2,869.4 | | Goodwill | $338.7 | $377.9 | | Total Assets | $4,956.4 | $4,933.7 | | Total current liabilities | $610.1 | $704.5 | | Total Liabilities | $1,943.5 | $1,946.8 | | Total Shareholders' Equity | $3,012.9 | $2,986.9 | - Total Assets increased by **$22.7 million (0.5%)** from December 31, 2024, to June 30, 2025[19](index=19&type=chunk) - Total Shareholders' Equity increased by **$26.0 million (0.9%)** from December 31, 2024, to June 30, 2025[19](index=19&type=chunk) [Consolidated Statements of Cash Flows (Unaudited)](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Consolidated Statements of Cash Flows (Unaudited) - Key Figures (in millions) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $267.2 | $280.2 | | Net cash used in investing activities | $(180.0) | $(178.1) | | Net cash used in financing activities | $(44.1) | $(101.3) | | Net increase in cash and cash equivalents | $43.1 | $0.8 | | Cash and cash equivalents, end of period | $160.7 | $103.2 | - Net cash provided by operating activities decreased by **$13.0 million (4.6%)** for the six months ended June 30, 2025, compared to the same period in 2024[20](index=20&type=chunk) - Net cash used in financing activities decreased significantly by **$57.2 million (56.5%)** for the six months ended June 30, 2025, primarily due to lower repayments on revolving credit and reduced stock repurchases[20](index=20&type=chunk)[196](index=196&type=chunk) [Consolidated Statements of Shareholders' Equity (Unaudited)](index=10&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity%20(Unaudited)) Consolidated Statements of Shareholders' Equity (Unaudited) - Key Figures (in millions) | Metric | Balance—December 31, 2024 | Balance—June 30, 2025 | | :-------------------------- | :------------------------ | :-------------------- | | Additional Paid-In Capital | $1,605.3 | $1,610.0 | | Retained Earnings | $1,481.8 | $1,510.2 | | Accumulated Other Comprehensive Loss | $(3.8) | $(2.6) | | Treasury Stock | $(96.4) | $(104.7) | | Total Shareholders' Equity | $2,986.9 | $3,012.9 | - Total Shareholders' Equity increased by **$26.0 million** from December 31, 2024, to June 30, 2025, driven by net income and share-based compensation, partially offset by dividends and treasury stock repurchases[22](index=22&type=chunk) [Note 1 General](index=11&type=section&id=Note%201%20General) - Schneider National, Inc. is a major provider of surface transportation and logistics solutions in North America, offering truckload, intermodal, and logistics services across the U.S., Canada, and Mexico[23](index=23&type=chunk) - The interim financial statements are prepared in conformity with **GAAP** and **SEC rules**, and management believes they reflect all necessary adjustments for fair presentation[24](index=24&type=chunk)[25](index=25&type=chunk) - New accounting pronouncements, **ASU 2023-09** (Income Taxes) and **ASU 2024-03** (Expense Disaggregation), are expected to expand disclosures but not materially affect consolidated financial statements[26](index=26&type=chunk)[27](index=27&type=chunk) [Note 2 Acquisitions](index=11&type=section&id=Note%202%20Acquisitions) - On December 2, 2024, Schneider acquired Cowan Systems, LLC for approximately **$398.6 million**, financed by cash and a delayed-draw term loan facility[28](index=28&type=chunk) - Cowan is a dedicated carrier with brokerage, drayage, and warehousing services, complementing Schneider's dedicated operations in the Eastern and Mid-Atlantic U.S[29](index=29&type=chunk) Preliminary Purchase Price Allocation for Cowan (in millions) | Asset/Liability | Adjusted December 2, 2024 Opening Balance Sheet | | :-------------------------- | :---------------------------------------------- | | Total assets acquired | $461.2 | | Total liabilities assumed | $62.6 | | Net assets acquired | $398.6 | | Goodwill | $7.0 | - The acquisition was accounted for using the **acquisition method**, with goodwill primarily attributable to expected synergies and growth in the dedicated business[30](index=30&type=chunk)[32](index=32&type=chunk) - Pro forma operating revenues for the combined entity would have been approximately **$1,480.2 million** for Q2 2024 and **$2,957.4 million** for YTD 2024, with no material difference in earnings[38](index=38&type=chunk) [Note 3 Revenue Recognition](index=13&type=section&id=Note%203%20Revenue%20Recognition) Disaggregated Revenues by Type of Service (in millions) | Revenue Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Transportation | $1,310.4 | $1,211.7 | $2,606.0 | $2,429.1 | | Logistics Management| $54.5 | $51.3 | $108.2 | $101.9 | | Other | $55.6 | $53.7 | $108.1 | $104.7 | | Total operating revenues | $1,420.5 | $1,316.7 | $2,822.3 | $2,635.7 | Remaining Performance Obligations (in millions) as of June 30, 2025 | Recognition Period | Transportation | Logistics Management | | :-------------------------- | :------------- | :------------------- | | Expected within one year | $84.4 | $20.3 | | Expected after one year | $133.0 | $20.8 | | Total | | $258.5 | - Cowan revenues are included in Transportation revenues starting **December 2, 2024**[39](index=39&type=chunk) [Note 4 Fair Value](index=14&type=section&id=Note%204%20Fair%20Value) - Fair value measurements are categorized into **Level 1** (quoted prices in active markets), **Level 2** (observable inputs other than Level 1), and **Level 3** (unobservable inputs)[45](index=45&type=chunk)[46](index=46&type=chunk) Financial Assets Measured at Fair Value (in millions) | Asset | Fair Value Hierarchy Level | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------------------- | :------------ | :---------------- | | Equity investment in TuSimple | Level 1 | $0.1 | $0.1 | | Marketable securities | Level 2 | $44.4 | $47.9 | - The fair value of unsecured senior notes was **$51.4 million** as of June 30, 2025, and **$145.9 million** as of December 31, 2024, valued using Level 2 inputs[50](index=50&type=chunk) [Note 5 Investments](index=15&type=section&id=Note%205%20Investments) Marketable Securities by Remaining Maturities and Fair Value (in millions) | Security Type | Remaining Maturities | Amortized Cost (Jun 30, 2025) | Fair Value (Jun 30, 2025) | Amortized Cost (Dec 31, 2024) | Fair Value (Dec 31, 2024) | | :---------------------------- | :------------------- | :---------------------------- | :------------------------ | :---------------------------- | :------------------------ | | U.S. treasury and government agencies | 1 to 68 months | $20.0 | $18.8 | $21.0 | $19.2 | | Corporate debt securities | 3 to 94 months | $12.2 | $12.0 | $15.3 | $14.9 | | State and municipal bonds | 3 to 160 months | $13.8 | $13.6 | $14.2 | $13.8 | | Total marketable securities | | $46.0 | $44.4 | $50.5 | $47.9 | - The company holds equity investments in Platform Science, Inc. and MLSI, accounted for using the measurement alternative under **ASC 321**, with combined values of **$137.3 million** as of June 30, 2025[56](index=56&type=chunk)[57](index=57&type=chunk) - In February 2025, ChemDirect's dissolution resulted in a **$4.9 million loss**; in May 2025, a **$13.0 million** note receivable from MLSI was converted to preferred stock[56](index=56&type=chunk) - An equity method investment in Scope 23 LLC, a technology company focused on supply chain carbon emissions, had a carrying value of **$4.3 million** as of June 30, 2025[62](index=62&type=chunk) [Note 6 Goodwill and Other Intangible Assets](index=16&type=section&id=Note%206%20Goodwill%20and%20Other%20Intangible%20Assets) Changes to Accumulated Goodwill by Reportable Segment (in millions) | Segment | Balance on December 31, 2024 | Acquisition Adjustments | Balance on June 30, 2025 | | :-------- | :--------------------------- | :---------------------- | :----------------------- | | Truckload | $363.7 | $(39.2) | $324.5 | | Logistics | $14.2 | — | $14.2 | | Total | $377.9 | $(39.2) | $338.7 | - Goodwill decreased by **$39.2 million** due to acquisition adjustments related to Cowan, primarily within the Truckload segment[65](index=65&type=chunk) Identifiable, Finite-Lived Intangible Assets (in millions) | Intangible Asset | Gross Carrying Amount (Jun 30, 2025) | Accumulated Amortization (Jun 30, 2025) | Net Carrying Amount (Jun 30, 2025) | Net Carrying Amount (Dec 31, 2024) | | :-------------------- | :----------------------------------- | :-------------------------------------- | :--------------------------------- | :--------------------------------- | | Customer relationships| $62.0 | $7.0 | $55.0 | $38.7 | | Trademarks | $21.4 | $3.3 | $18.1 | $8.5 | | Non-compete agreements| $5.4 | $2.1 | $3.3 | $3.9 | | Total | $88.8 | $12.4 | $76.4 | $51.1 | - Amortization expense for intangible assets was **$1.8 million** for Q2 2025 (up from $1.3 million in Q2 2024) and **$3.7 million** for YTD 2025 (up from $2.6 million in YTD 2024)[68](index=68&type=chunk) [Note 7 Debt and Credit Facilities](index=17&type=section&id=Note%207%20Debt%20and%20Credit%20Facilities) Debt and Credit Facilities (in millions) | Debt Type | June 30, 2025 | December 31, 2024 | | :------------------------------ | :------------ | :---------------- | | Unsecured senior notes | $50.0 | $145.0 | | Receivables purchase agreement | $70.0 | $70.0 | | Delayed-draw term loan facility | $400.0 | $300.0 | | Total debt and credit facilities| $520.0 | $515.0 | | Long-term debt | $509.5 | $416.3 | - The company has a **$250.0 million** Revolving Credit Agreement with no outstanding borrowings and a **$200.0 million** Receivables Purchase Agreement with **$70.0 million** outstanding as of June 30, 2025[70](index=70&type=chunk)[71](index=71&type=chunk) - A **$400.0 million** delayed-draw term loan facility, used to finance the Cowan acquisition, was outstanding as of June 30, 2025[70](index=70&type=chunk)[72](index=72&type=chunk) [Note 8 Leases](index=18&type=section&id=Note%208%20Leases) - Cash paid for operating leases totaled **$20.8 million** for YTD June 30, 2025, as the company leases real estate and equipment under operating and finance leases[73](index=73&type=chunk)[74](index=74&type=chunk) Net Investment in Leases (as Lessor, in millions) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------------- | :------------ | :---------------- | | Future minimum payments to be received | $172.4 | $166.2 | | Guaranteed residual lease values | $99.3 | $96.7 | | Total minimum lease payments to be received | $271.7 | $262.9 | | Unearned income | $(46.5) | $(44.5) | | Net investment in leases | $225.2 | $218.4 | Sales-Type Leases Operating Profit (in millions) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $63.2 | $60.1 | $119.2 | $118.0 | | Cost of goods sold| $(56.6) | $(54.1) | $(107.0) | $(104.9) | | Operating profit| $6.6 | $6.0 | $12.2 | $13.1 | [Note 9 Income Taxes](index=19&type=section&id=Note%209%20Income%20Taxes) Effective Income Tax Rate | Period | Effective Income Tax Rate | | :-------------------------- | :------------------------ | | Three Months Ended June 30, 2025 | 24.1% | | Three Months Ended June 30, 2024 | 25.0% | | Six Months Ended June 30, 2025 | 24.5% | | Six Months Ended June 30, 2024 | 25.0% | - The effective income tax rate decreased slightly in both the three-month and six-month periods ended June 30, 2025, compared to the prior year[80](index=80&type=chunk) - New U.S. legislation (**OBBBA**) enacted on July 4, 2025, will require recognition of effects on deferred tax balances in Q3 2025, but is not expected to have a material impact[81](index=81&type=chunk) [Note 10 Common Equity](index=19&type=section&id=Note%2010%20Common%20Equity) Basic and Diluted Earnings Per Share (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income available to common shareholders | $36.0 | $35.3 | $62.1 | $53.8 | | Weighted average common shares outstanding | 175.2 | 175.5 | 175.3 | 175.7 | | Basic earnings per common share | $0.21 | $0.20 | $0.35 | $0.31 | | Diluted earnings per common share | $0.20 | $0.20 | $0.35 | $0.31 | Changes in Class B Common Shares Outstanding | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Outstanding at beginning of period | 92,169,401 | 92,844,330 | 92,221,383 | 92,931,242 | | Repurchases of common stock | — | (581,106) | (337,352) | (1,143,873) | | Share issuances | 64,096 | 38,349 | 528,653 | 698,133 | | Outstanding at end of period | 92,233,497 | 92,301,573 | 92,233,497 | 92,301,573 | - The Board declared a quarterly cash dividend of **$0.095 per share** for Q3 2025, payable on October 9, 2025[86](index=86&type=chunk) [Note 11 Share-Based Compensation](index=20&type=section&id=Note%2011%20Share-Based%20Compensation) - Share-based compensation expense was **$4.6 million** for Q2 2025 (up from $3.9 million in Q2 2024) and **$9.2 million** for YTD 2025 (up from $5.1 million in YTD 2024)[88](index=88&type=chunk) - As of June 30, 2025, **$25.3 million** of pre-tax unrecognized compensation cost remains, to be recognized over a weighted average period of **1.9 years**[88](index=88&type=chunk) [Note 12 Commitments and Contingencies](index=20&type=section&id=Note%2012%20Commitments%20and%20Contingencies) - The company is involved in various legal matters and investigations, accruing for probable and estimable costs, but does not expect a material impact on its business or financial statements[89](index=89&type=chunk) - Liabilities for claims (personal injury, workers' compensation, property damage, cargo) are recorded based on expected losses, with excess liability insurance maintained for most claims[90](index=90&type=chunk) - Firm commitments to purchase transportation equipment totaled **$134.9 million** as of June 30, 2025[91](index=91&type=chunk) [Note 13 Segment Reporting](index=21&type=section&id=Note%2013%20Segment%20Reporting) - The company operates through three reportable segments: **Truckload**, **Intermodal**, and **Logistics**[93](index=93&type=chunk) Segment Operating Revenues (in millions) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Truckload | $719.9 | $643.1 | $1,434.4 | $1,288.1 | | Intermodal| $305.5 | $299.4 | $608.3 | $596.0 | | Logistics | $341.0 | $320.4 | $674.5 | $646.8 | Segment Income from Operations (in millions) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Truckload | $40.1 | $30.7 | $65.2 | $45.6 | | Intermodal| $16.1 | $14.6 | $29.9 | $21.6 | | Logistics | $7.9 | $11.2 | $16.0 | $16.6 | [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the company's financial condition and results, including business overview, GAAP to non-GAAP reconciliations, enterprise and segment performance, liquidity, capital resources, and critical accounting estimates [Introduction](index=24&type=section&id=Introduction) - Schneider is a transportation and logistics services company offering truckload, intermodal, and logistics solutions, aiming to maximize returns across market cycles[103](index=103&type=chunk) - Truckload services include over-the-road freight transportation via dry van, bulk, temperature-controlled, and flat-bed trailers, utilizing company drivers and owner-operators[104](index=104&type=chunk) - Intermodal services provide door-to-door container on flat car service through rail and dray transportation, using company-owned assets and third-party capacity[105](index=105&type=chunk) - Logistics services encompass asset-light freight brokerage, supply chain management (**3PL**), warehousing, and import/export services[106](index=106&type=chunk) - The business is seasonal, with revenues typically lowest in Q1 and highest in Q4, and operating expenses higher in winter months[108](index=108&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) - The company presents non-GAAP financial measures such as revenues (excluding fuel surcharge), adjusted income from operations, and adjusted EBITDA to provide a clearer view of core operating performance[110](index=110&type=chunk)[111](index=111&type=chunk) - These non-GAAP measures are used internally by management to assess performance and help investors understand the business by isolating factors from fluctuating fuel prices[111](index=111&type=chunk) [Enterprise Summary](index=25&type=section&id=Enterprise%20Summary) Enterprise Key GAAP and Non-GAAP Financial Measures (in millions, except ratios) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Operating revenues | $1,420.5 | $1,316.7 | $2,822.3 | $2,635.7 | | Revenues (excluding fuel surcharge) | $1,282.0 | $1,167.9 | $2,540.3 | $2,331.0 | | Income from operations | $55.0 | $51.0 | $97.1 | $79.7 | | Adjusted income from operations | $56.8 | $52.3 | $101.0 | $82.3 | | Operating ratio | 96.1 % | 96.1 % | 96.6 % | 97.0 % | | Adjusted operating ratio | 95.6 % | 95.5 % | 96.0 % | 96.5 % | | Net income | $36.0 | $35.3 | $62.1 | $53.8 | | Adjusted net income | $37.4 | $36.3 | $65.1 | $55.8 | | Adjusted EBITDA | $166.3 | $152.9 | $321.1 | $283.6 | | Free cash flow | $123.0 | $112.9 | $117.6 | $98.6 | - Adjusted EBITDA increased by **8.8%** for Q2 2025 and **13.2%** for YTD 2025, reflecting improved core operating performance[114](index=114&type=chunk) - Free cash flow increased by **8.9%** for Q2 2025 and **19.3%** for YTD 2025, indicating stronger liquidity[114](index=114&type=chunk) [Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024](index=27&type=section&id=Three%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20Three%20Months%20Ended%20June%2030%2C%202024) - Enterprise net income increased by **$0.7 million (2%)** to **$36.0 million**, and adjusted net income increased by **$1.1 million (3%)** to **$37.4 million**, driven by higher income from operations and a lower effective tax rate[126](index=126&type=chunk)[127](index=127&type=chunk) - Operating revenues increased by **$103.8 million (8%)**, primarily due to volume growth in Dedicated (Cowan acquisition impact) and Intermodal, and increased rates in Dedicated and Network, partially offset by lower fuel surcharge revenues[128](index=128&type=chunk)[133](index=133&type=chunk) - Income from operations increased by **$4.0 million (8%)**, with the operating ratio remaining flat at **96.1%** (GAAP) and **95.6%** (adjusted)[129](index=129&type=chunk)[130](index=130&type=chunk) - Key expense increases included salaries, wages, and benefits (**$47.0 million, 13%**), depreciation and amortization (**$9.8 million, 10%**), operating supplies and expenses (**$23.3 million, 15%**), insurance (**$9.3 million, 28%**), and other general expenses (**$8.3 million, 31%**), largely due to the Cowan acquisition and increased headcount[134](index=134&type=chunk) - Truckload revenues (excluding fuel surcharge) increased by **$81.9 million (15%)**, driven by a **23%** increase in Dedicated volume (Cowan acquisition) and improved rates[143](index=143&type=chunk) - Intermodal revenues (excluding fuel surcharge) increased by **$12.0 million (5%)** due to **5%** volume growth, leading to a **10%** increase in income from operations[149](index=149&type=chunk) - Logistics revenues (excluding fuel surcharge) increased by **$20.8 million (7%)** due to the Cowan acquisition, but income from operations decreased by **$3.3 million (29%)** due to lower brokerage volume[152](index=152&type=chunk) [Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024](index=31&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20Six%20Months%20Ended%20June%2030%2C%202024) - Enterprise net income increased by **$8.3 million (15%)** to **$62.1 million**, and adjusted net income increased by **$9.3 million (17%)** to **$65.1 million**, primarily due to a **$17.4 million** increase in income from operations[154](index=154&type=chunk)[155](index=155&type=chunk) - Operating revenues increased by **$186.6 million (7%)**, driven by Truckload (Dedicated volume, rates), Logistics (Cowan acquisition, revenue per order), and Intermodal (volume, revenue per order), partially offset by lower fuel surcharge revenues[157](index=157&type=chunk)[161](index=161&type=chunk) - Income from operations increased by **$17.4 million (22%)**, and the operating ratio decreased on both a GAAP and adjusted basis[158](index=158&type=chunk)[159](index=159&type=chunk) - Key expense changes included a **$24.5 million (2%)** decrease in purchased transportation, offset by increases in salaries, wages, and benefits (**$91.9 million, 13%**), depreciation and amortization (**$20.6 million, 10%**), operating supplies and expenses (**$44.8 million, 14%**), and insurance (**$19.4 million, 30%**), largely due to the Cowan acquisition[162](index=162&type=chunk) - Truckload revenues (excluding fuel surcharge) increased by **$157.5 million (15%)**, with Dedicated volume up **24%** (Cowan acquisition) and improved rates[171](index=171&type=chunk) - Intermodal revenues (excluding fuel surcharge) increased by **$25.2 million (5%)** due to **5%** volume growth and higher revenue per order, resulting in a **$8.3 million (38%)** increase in income from operations[177](index=177&type=chunk) - Logistics revenues (excluding fuel surcharge) increased by **$27.9 million (4%)** due to the Cowan acquisition, but income from operations decreased by **$0.6 million (4%)** due to increased salaries and wages[180](index=180&type=chunk)[181](index=181&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=35&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) - Primary uses of cash include working capital, capital expenditures, lease equipment, dividends, share repurchases, and debt service, with main liquidity sources from operations and credit facilities[184](index=184&type=chunk)[186](index=186&type=chunk) - Cash and cash equivalents increased by **$43.1 million** from December 31, 2024, to June 30, 2025, reaching **$160.7 million**[187](index=187&type=chunk) - Net cash provided by operating activities decreased by **$13.0 million** for YTD 2025, primarily due to increased cash used by receivables and claims settlements[191](index=191&type=chunk) - Net capital expenditures decreased by **$32.0 million** for YTD 2025, driven by a **$36.9 million** decrease in transportation equipment purchases[194](index=194&type=chunk)[195](index=195&type=chunk) - Net cash used in financing activities decreased by **$57.2 million** for YTD 2025, mainly due to reduced repayments on revolving credit, fewer common stock repurchases, and increased debt proceeds[196](index=196&type=chunk) - The company was in compliance with all financial covenants under its credit agreements as of **June 30, 2025**[188](index=188&type=chunk) [CRITICAL ACCOUNTING ESTIMATES](index=38&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) - No significant changes to critical accounting estimates or policies have occurred since the Annual Report on Form 10-K for the year ended December 31, 2024[202](index=202&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures about Market Risk](index=38&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) No significant changes to the company's market risks have occurred since the Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - No significant changes in market risks have occurred since the previous Annual Report on Form 10-K[203](index=203&type=chunk) [ITEM 4. Controls and Procedures](index=38&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were **effective** as of June 30, 2025[204](index=204&type=chunk) - No material changes in internal control over financial reporting occurred during the fiscal quarter[205](index=205&type=chunk) [PART II. OTHER INFORMATION](index=39&type=section&id=PART%20II.%20OTHER%20INFORMATION) [ITEM 1. Legal Proceedings](index=39&type=section&id=ITEM%201.%20Legal%20Proceedings) Information on legal proceedings, including various lawsuits in the ordinary course of business, is incorporated by reference from Note 12, Commitments and Contingencies - Information on legal proceedings is incorporated by reference from **Note 12, Commitments and Contingencies**[207](index=207&type=chunk) [ITEM 1A. Risk Factors](index=39&type=section&id=ITEM%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, have occurred - No material changes to risk factors have occurred since the Annual Report on Form 10-K for 2024[208](index=208&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No equity securities were repurchased during the three months ended June 30, 2025, and credit facility covenants limit dividend payments if a default exists or would be caused - No equity securities were repurchased during the three months ended **June 30, 2025**[209](index=209&type=chunk) - Covenants in the **2022 Credit Facility** and delayed-draw term loan facility limit dividend payments if a default exists or would be caused by the dividend[210](index=210&type=chunk) [ITEM 3. Defaults Upon Senior Securities](index=39&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities for the period - There were no defaults upon senior securities[211](index=211&type=chunk) [ITEM 4. Mine Safety Disclosures](index=39&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Mine Safety Disclosures are not applicable to the company[212](index=212&type=chunk) [ITEM 5. Other Information](index=39&type=section&id=ITEM%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025 - No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during **Q2 2025**[213](index=213&type=chunk) [ITEM 6. Exhibits](index=40&type=section&id=ITEM%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certifications (31.1, 31.2, 32.1, 32.2) and XBRL-related documents - The report includes various certifications (Sarbanes-Oxley Act Sections 302 and 906) and XBRL taxonomy documents[214](index=214&type=chunk) [Signature](index=41&type=section&id=Signature) The report was signed by Darrell G. Campbell, Executive Vice President and Chief Financial Officer of Schneider National, Inc., on July 31, 2025 - The report was signed by **Darrell G. Campbell**, Executive Vice President and Chief Financial Officer, on **July 31, 2025**[218](index=218&type=chunk)

Financial Data and Key Metrics Changes - The company reported enterprise revenues excluding fuel surcharge of $1.3 billion, a 10% increase year over year [22] - Adjusted income from operations was $57 million, reflecting a 9% year-over-year increase [22] - Adjusted diluted earnings per share for the second quarter was 21 cents [23] Business Line Data and Key Metrics Changes - Truckload revenue, excluding fuel surcharge, was $622 million, up 15% year over year, driven by acquisitions and higher revenue per truck per week [24] - Intermodal revenues, excluding fuel surcharge, were $265 million, a 5% increase year over year, attributed to volume growth [25] - Logistics revenue, excluding fuel surcharge, totaled $340 million, up 7% from the previous year, driven by the Cowen acquisition [26] Market Data and Key Metrics Changes - The company experienced a 30% year-over-year volume growth in Mexico, which was a key driver for second quarter growth [18] - The dedicated segment now represents about 70% of the truckload fleet, indicating a strategic shift towards dedicated capacity [13] Company Strategy and Development Direction - The company is focused on restoring margins and maximizing through-cycle returns while leaning into areas of differentiation for growth [7][15] - The long-term strategy includes shifting towards dedicated and variable cost capacity to improve earnings resilience [15] - Recent acquisitions, including Cowen Systems, are expected to contribute positively to income from operations [20] Management's Comments on Operating Environment and Future Outlook - The management anticipates economic uncertainty to persist, but expects the freight environment to continue moving towards recovery [21] - There is a belief that strong execution on structural improvements will drive earnings higher in 2025 [22] - The company is monitoring trade policy and broader economic uncertainty as part of its guidance considerations [29] Other Important Information - The company is targeting over $40 million in cost reductions, with synergies from Cowen Systems expected to fully materialize by 2026 [12] - The net debt leverage improved to 0.6 times at the end of the quarter, down from 0.8 times [29] Q&A Session Summary Question: Long-term truckload target of 12% to 16% - Management indicated that the dedicated business is performing resiliently, while the network business requires price recovery to reach long-term targets [38][40] Question: Peak season development and guidance - Management noted a wide range of behaviors among customers regarding peak season, with intermodal peak surcharges already in place [44][45] Question: Competitive environment in segments - Management acknowledged that mid-sized competitors are exiting the market, which could lead to a meaningful amount of capacity leaving the truckload space [66][70] Question: Impact of gain on sale in truckload - The company expects a modest impact from gains on the sale of equipment, with improvements anticipated in the second half of the year [95][96] Question: Intermodal growth and rail consolidation - Management emphasized the importance of strategic partnerships and differentiation in intermodal services, particularly in light of potential rail consolidation [100][102]

Core Insights - Schneider National reported $1.42 billion in revenue for the quarter ended June 2025, marking a year-over-year increase of 7.9% and an EPS of $0.21, unchanged from the previous year [1] - The revenue figure was a slight miss of -0.24% compared to the Zacks Consensus Estimate, while the EPS met expectations [1] Financial Performance Metrics - The operating ratio for the consolidated segment was reported at 96.1%, slightly higher than the estimated 95.9% [4] - The intermodal operating ratio was 93.9%, better than the average estimate of 94.4% [4] - The truckload operating ratio was 93.6%, compared to the estimated 94.8% [4] - The logistics operating ratio was 97.7%, exceeding the estimated 97.2% [4] Revenue Breakdown - Fuel surcharge revenue was $138.5 million, below the estimated $141.51 million, reflecting a -6.9% year-over-year change [4] - Inter-segment eliminations revenue was reported at -$41.7 million, worse than the estimated -$33.34 million, but a +4.5% change year-over-year [4] - Logistics revenue reached $339.6 million, surpassing the estimated $327.16 million, with a +6.5% year-over-year increase [4] - Other revenues were $96.8 million, slightly below the estimated $98.43 million, showing a +1.3% year-over-year change [4] - Revenues excluding fuel surcharge totaled $1.28 billion, matching estimates and reflecting a +9.8% year-over-year increase [4] - Intermodal revenue was $265.1 million, exceeding the estimated $256.21 million, with a +4.7% year-over-year change [4] - Truckload revenue was $622.2 million, below the estimated $633.84 million, but showing a +15.2% year-over-year increase [4] - Network revenues excluding fuel surcharge were $181.9 million, below the estimated $193.67 million, reflecting a -6.1% year-over-year change [4] Stock Performance - Schneider National's shares have returned -4.6% over the past month, contrasting with the Zacks S&P 500 composite's +2.7% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Financial Data and Key Metrics Changes - Enterprise revenues excluding fuel surcharge were $1.3 billion, up 10% year over year [21] - Adjusted income from operations was $57 million, a 9% increase year over year [21] - Adjusted diluted earnings per share for the second quarter was 21 cents [22] - Truckload revenue excluding fuel surcharge was $622 million, up 15% year over year [23] - Intermodal revenues excluding fuel surcharge were $265 million, up 5% year over year [24] - Logistics revenue excluding fuel surcharge totaled $340 million, up 7% from the same period a year ago [25] - Free cash flow increased approximately $10 million compared to the same period in 2024 [26] Business Line Data and Key Metrics Changes - Truckload operating income reached $40 million, a 31% increase year over year [23] - Intermodal operating income was $16 million, a 10% increase compared to the same period last year [24] - Logistics income from operations was $8 million, down 29% from last year's high watermark [25] - Truckload earnings improved nearly 60% sequentially and over 30% year over year [13] Market Data and Key Metrics Changes - Mexico was a key driver of second quarter volume growth, which rose 30% year over year [17] - Year-to-date win rates on the most accretive lanes in Mexico are trending at nearly double last year's levels [18] Company Strategy and Development Direction - The company is focused on restoring margins while maximizing through-cycle returns [5] - Emphasis on organic growth combined with accretive mergers and acquisitions [6] - The long-term strategy includes shifting the business toward dedicated and variable cost capacity to improve earnings resilience [14] - The company is leveraging its multimodal portfolio to capture available volume even in a tepid environment [14] Management's Comments on Operating Environment and Future Outlook - The economic uncertainty is expected to persist into the second half of the year, with trade policy continuing to evolve [19] - The company anticipates a gradual recovery in the freight environment, with capacity exiting the market at a slow but steady pace [20] - Management believes strong execution on structural improvements will drive earnings higher in 2025 [21] Other Important Information - The company is targeting structural cost savings of over $40 million, with full run rate benefits anticipated in 2026 [11] - The company has $526 million in total debt and lease obligations and $161 million of cash and cash equivalents as of June 30, 2025 [28] Q&A Session Summary Question: Long-term truckload target of 12% to 16% - Management indicated that the dedicated business is performing resiliently and achieving the low end of long-term guidance, while the network business requires price recovery to reach targets [35][36] Question: Peak season development and guidance - Management noted a wide range of behaviors among customers regarding peak season, with intermodal peak surcharges already in place [40][41] Question: Competitive environment in segments - Management observed mid-sized competitors exiting the market and noted that the dedicated segment is facing different competitive dynamics [61][65] Question: Impact of gain on sale in truckload - Management mentioned a modest impact on results from the sale of equipment, with expectations for improvement in the second half of the year [89][91]

Core Insights - Schneider National reported quarterly earnings of $0.21 per share, matching the Zacks Consensus Estimate, and consistent with the previous year's earnings [1] - The company posted revenues of $1.42 billion for the quarter ended June 2025, slightly missing the Zacks Consensus Estimate by 0.24%, but showing an increase from $1.32 billion year-over-year [2] - The stock has underperformed, losing approximately 16.3% since the beginning of the year, while the S&P 500 has gained 8.2% [3] Earnings Outlook - The company's earnings outlook is crucial for investors, with current consensus EPS estimates at $0.23 for the upcoming quarter and $0.86 for the current fiscal year, with revenues expected to be $1.46 billion and $5.79 billion respectively [7] - The trend of estimate revisions for Schneider National has been unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The Transportation - Services industry, to which Schneider National belongs, is currently ranked in the bottom 9% of over 250 Zacks industries, suggesting a challenging environment for stocks in this sector [8] - Another company in the same industry, RXO, is expected to report a quarterly earnings decline of 33.3% year-over-year, with revenues projected to be $1.45 billion, reflecting a 56% increase from the previous year [9][10]

Financial Performance - Operating revenues increased to $1421 million in 2Q25 from $1317 million in 2Q24[77] - Revenues excluding fuel surcharge were $1282 million in 2Q25, compared to $1168 million in 2Q24[77] - Adjusted income from operations improved by 9% year-over-year[82] - Adjusted EBITDA increased from $153 million in 2Q24 to $166 million in 2Q25[77] Segment Results - Truckload revenues excluding fuel surcharge increased 15% year-over-year due to the Cowan acquisition and higher revenue per truck per week[87] - Dedicated average trucks grew 27% year-over-year, primarily driven by the Cowan acquisition[87] - Intermodal revenues excluding fuel surcharge increased 5% year-over-year due to a 5% volume growth[91] - Logistics revenues excluding fuel surcharge increased 7% year-over-year due to the Cowan Systems acquisition and Power Only growth[94] Capital Allocation and Strategy - The company announced a $150 million, 3-year share repurchase program in February 2023, with approximately $46.1 million remaining as of June 30, 2025[61] - Dividends have increased 90% since the IPO in April 2017[61]

Executive Summary & Consolidated Financial Highlights [Q2 2025 Announcement and CEO Commentary](index=1&type=section&id=Schneider%20National%2C%20Inc.%20Announces%20Second%20Quarter%202025%20Results) Schneider National, Inc. announced Q2 2025 results, reporting earnings growth driven by strong execution in Truckload and Intermodal segments - Schneider National, Inc. announced results for the three months ended June 30, 2025, reporting another quarter of earnings growth[1](index=1&type=chunk)[2](index=2&type=chunk)[3](index=3&type=chunk) - CEO Mark Rourke attributed growth to solid execution in Truckload and Intermodal segments, structural business improvements, strategic growth priorities, and acquisitions[3](index=3&type=chunk) - Truckload segment achieved **double-digit earnings improvement**, while Intermodal saw continued **volume momentum and earnings improvement** from network optimization[3](index=3&type=chunk) [Consolidated Results Summary](index=1&type=section&id=Results%20of%20Operations%20%28unaudited%29) Q2 2025 operating revenues increased 8% to $1,420.5 million, net income rose 2% to $36.0 million, with diluted and adjusted EPS flat Q2 2025 Consolidated Financial Highlights (YoY Change) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change | | :-------------------------------- | :----------------- | :----------------- | :----- | | Operating revenues | $1,420.5 | $1,316.7 | 8% | | Revenues (excluding fuel surcharge) | $1,282.0 | $1,167.9 | 10% | | Income from operations | $55.0 | $51.0 | 8% | | Adjusted income from operations | $56.8 | $52.3 | 9% | | Net income | $36.0 | $35.3 | 2% | | Adjusted net income | $37.4 | $36.3 | 3% | | Adjusted EBITDA | $166.3 | $152.9 | 9% | | Diluted earnings per share | $0.20 | $0.20 | —% | | Adjusted diluted earnings per share | $0.21 | $0.21 | —% | - For the six months ended June 30, 2025, operating revenues increased **7% to $2,822.3 million**, income from operations increased **22% to $97.1 million**, and net income increased **15% to $62.1 million**[5](index=5&type=chunk) [Enterprise Results](index=2&type=section&id=Enterprise%20Results) Enterprise income from operations for Q2 2025 increased 8% to $55.0 million, with diluted and adjusted EPS remaining flat - Enterprise income from operations for Q2 2025 was **$55.0 million**, an **8% increase** ($4.0 million) compared to Q2 2024[7](index=7&type=chunk) - Diluted earnings per share and Adjusted diluted earnings per share were **$0.20** and **$0.21**, respectively, for both Q2 2025 and Q2 2024[7](index=7&type=chunk) [Cash Flow and Capitalization](index=2&type=section&id=Cash%20Flow%20and%20Capitalization) As of June 30, 2025, total debt was $526.2 million, cash $160.7 million, and free cash flow increased $10.1 million Cash Flow and Capitalization Highlights (June 30, 2025) | Metric | Amount (Millions) | | :-------------------------------- | :---------------- | | Total debt and finance lease obligations | $526.2 | | Cash and cash equivalents | $160.7 | | Free cash flow increase (YoY) | $10.1 | - Net capital expenditures were lower compared to the prior year resulting from reduced purchases of transportation equipment[8](index=8&type=chunk) - The Company repurchased **$103.9 million** of Class B shares under its **$150.0 million** stock repurchase program and declared two quarterly dividends of **$0.095 per share**[9](index=9&type=chunk) Segment Performance Analysis [Truckload Segment](index=2&type=section&id=Truckload) Truckload revenues (excl. fuel surcharge) increased 15% to $622.2 million, with income from operations up 31% to $40.1 million Truckload Segment Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change | | :-------------------------------- | :----------------- | :----------------- | :----- | | Revenues (excl. fuel surcharge) | $622.2 | $540.3 | 15% | | Income from operations | $40.1 | $30.7 | 31% | | Operating ratio | 93.6% | 94.3% | 70 bps improvement | - Dedicated volume increased **23%** primarily due to the acquisition of Cowan Systems, partially offset by lower Network volume[10](index=10&type=chunk) - Revenue per truck per week increased **1% to $3,964** due to improved rate per mile[10](index=10&type=chunk) [Intermodal Segment](index=2&type=section&id=Intermodal) Intermodal revenues (excl. fuel surcharge) rose 5% to $265.1 million, with income from operations increasing 10% to $16.1 million Intermodal Segment Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change | | :-------------------------------- | :----------------- | :----------------- | :----- | | Revenues (excl. fuel surcharge) | $265.1 | $253.1 | 5% | | Income from operations | $16.1 | $14.6 | 10% | | Operating ratio | 93.9% | 94.2% | 30 bps improvement | - Volume growth of **5%** was the primary driver for revenue increase, with revenue per order remaining roughly flat[12](index=12&type=chunk) - Lower purchased transportation costs contributed to the earnings growth[13](index=13&type=chunk) [Logistics Segment](index=2&type=section&id=Logistics) Logistics revenues (excl. fuel surcharge) increased 7% to $339.6 million, but income from operations decreased 29% to $7.9 million Logistics Segment Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change | | :-------------------------------- | :----------------- | :----------------- | :----- | | Revenues (excl. fuel surcharge) | $339.6 | $318.8 | 7% | | Income from operations | $7.9 | $11.2 | (29%) | | Operating ratio | 97.7% | 96.5% | 120 bps decrease | - Revenue increase primarily due to the acquisition of Cowan Systems, partially offset by lower brokerage volume and revenue per order[14](index=14&type=chunk) - Lower brokerage volume was the main driver for the decrease in income from operations[15](index=15&type=chunk) Business Outlook [Business Outlook](index=3&type=section&id=Business%20Outlook) Schneider updated full-year 2025 adjusted diluted EPS guidance to $0.75 - $0.95, with net capital expenditures unchanged Full Year 2025 Guidance Update | Metric | Prior Guidance | Current Guidance | | :-------------------------------- | :------------- | :--------------- | | Adjusted diluted earnings per share | $0.75 - $1.00 | $0.75 - $0.95 | | Net capital expenditures (millions) | $325 - $375 | $325 - $375 | - The company expects year-over-year earnings improvement in 2025, driven by controlling costs, enhancing asset efficiency, diligent customer allocations, differentiation, and accretive acquisitions[16](index=16&type=chunk) - Uncertainties include the timing and impact of trade, legislative, and regulatory policy, and ongoing industry cost inflation[16](index=16&type=chunk) Non-GAAP Financial Measures & Reconciliations [Explanation of Non-GAAP Measures](index=3&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Non-GAAP measures like adjusted income from operations are presented to clarify core operating performance by excluding non-core items - Non-GAAP measures are used to assist investors in understanding the business by removing the impact of items not reflecting core operating performance and providing comparable financial results between periods[17](index=17&type=chunk)[45](index=45&type=chunk) - Revenues (excluding fuel surcharge) are useful as they isolate volume, price, and cost changes related to industry demand from fluctuating fuel prices[45](index=45&type=chunk) - Management primarily relies on GAAP results in addition to using non-GAAP measures, acknowledging their limitations as analytical tools[46](index=46&type=chunk) [Reconciliation of Revenues (excluding fuel surcharge)](index=10&type=section&id=Revenues%20%28excluding%20fuel%20surcharge%29) This section reconciles GAAP operating revenues to non-GAAP revenues excluding fuel surcharge, isolating fuel price impact on core performance Reconciliation of Revenues (excluding fuel surcharge) | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Operating revenues | $1,420.5 | $1,316.7 | $2,822.3 | $2,635.7 | | Less: Fuel surcharge revenues | 138.5 | 148.8 | 282.0 | 304.7 | | Revenues (excluding fuel surcharge) | $1,282.0 | $1,167.9 | $2,540.3 | $2,331.0 | [Reconciliation of Adjusted Income from Operations](index=11&type=section&id=Adjusted%20income%20from%20operations) This reconciliation adjusts GAAP income from operations by excluding acquisition costs and intangible asset amortization for core performance Reconciliation of Adjusted Income from Operations | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Income from operations | $55.0 | $51.0 | $97.1 | $79.7 | | Acquisition-related costs | — | — | 0.2 | — | | Amortization of intangible assets | 1.8 | 1.3 | 3.7 | 2.6 | | Adjusted income from operations | $56.8 | $52.3 | $101.0 | $82.3 | [Reconciliation of Adjusted Operating Ratio](index=11&type=section&id=Adjusted%20operating%20ratio) The adjusted operating ratio normalizes operational efficiency by excluding fuel surcharge, acquisition costs, and intangible asset amortization Reconciliation of Adjusted Operating Ratio | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | GAAP Operating ratio | 96.1 % | 96.1 % | 96.6 % | 97.0 % | | Revenues (excluding fuel surcharge) | $1,282.0 | $1,167.9 | $2,540.3 | $2,331.0 | | Adjusted total operating expenses, net of fuel surcharge revenues | $1,225.2 | $1,115.6 | $2,439.3 | $2,248.7 | | Adjusted operating ratio | 95.6 % | 95.5 % | 96.0 % | 96.5 % | [Reconciliation of Adjusted Net Income](index=12&type=section&id=Adjusted%20net%20income) This reconciliation adjusts GAAP net income by adding back acquisition costs and intangible asset amortization, with tax effect, for core profitability Reconciliation of Adjusted Net Income | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net income | $36.0 | $35.3 | $62.1 | $53.8 | | Acquisition-related costs | — | — | 0.2 | — | | Amortization of intangible assets | 1.8 | 1.3 | 3.7 | 2.6 | | Income tax effect of non-GAAP adjustments | (0.4) | (0.3) | (0.9) | (0.6) | | Adjusted net income | $37.4 | $36.3 | $65.1 | $55.8 | [Reconciliation of Adjusted EBITDA](index=12&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA is reconciled from net income by adding back interest, taxes, depreciation, amortization, and acquisition costs for operational cash flow Reconciliation of Adjusted EBITDA | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net income | $36.0 | $35.3 | $62.1 | $53.8 | | Interest expense, net | 6.6 | 3.4 | 12.8 | 6.6 | | Provision for income taxes | 11.4 | 11.7 | 20.1 | 17.9 | | Depreciation and amortization | 112.3 | 102.5 | 225.9 | 205.3 | | Acquisition-related costs | — | — | 0.2 | — | | Adjusted EBITDA | $166.3 | $152.9 | $321.1 | $283.6 | [Reconciliation of Free Cash Flow](index=12&type=section&id=Free%20cash%20flow) Free cash flow is net cash from operating activities less capital expenditures, serving as a key liquidity measure Reconciliation of Free Cash Flow | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net cash provided by operating activities | $175.5 | $182.6 | $267.2 | $280.2 | | Net capital expenditures | (52.5) | (69.7) | (149.6) | (181.6) | | Free cash flow | $123.0 | $112.9 | $117.6 | $98.6 | [Reconciliation of Adjusted Diluted Earnings Per Share](index=13&type=section&id=Adjusted%20diluted%20earnings%20per%20share) This reconciliation adjusts GAAP diluted EPS by incorporating tax-effected non-GAAP adjustments for an adjusted view of per-share profitability Reconciliation of Adjusted Diluted Earnings Per Share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Diluted earnings per share | $0.20 | $0.20 | $0.35 | $0.31 | | Non-GAAP adjustments, tax effected | 0.01 | 0.01 | 0.02 | 0.01 | | Adjusted diluted earnings per share | $0.21 | $0.21 | $0.37 | $0.32 | Company Profile & Investor Information [About Schneider National, Inc.](index=3&type=section&id=About%20Schneider%20National%2C%20Inc.) Schneider National, Inc. is a leading North American surface transportation and logistics provider, offering multimodal services and leveraging AI for optimization - Schneider is among the largest providers of surface transportation and logistics solutions in North America, offering a multimodal portfolio of services[19](index=19&type=chunk) - The company leverages artificial intelligence, data science, and analytics to provide innovative solutions that coordinate the timely, safe, and effective movement of customer products[19](index=19&type=chunk) - Service offerings include transportation of full-truckload freight, intermodal services with major North American rail carriers, and comprehensive logistics services[20](index=20&type=chunk) [Conference Call and Contact Information](index=4&type=section&id=Conference%20Call%20and%20Webcast%20Information) Schneider hosted an earnings conference call and webcast on July 31, 2025, with investor relations contact information provided - An earnings conference call and webcast was held on July 31, 2025, at 10:30 a.m. Eastern Time[21](index=21&type=chunk) - Contact for investor relations is Christyne McGarvey, Vice President of Investor Relations and Corporate Finance[22](index=22&type=chunk) GAAP Financial Statements [Consolidated Statements of Income](index=5&type=section&id=SCHNEIDER%20NATIONAL%2C%20INC.%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20%28Unaudited%29) Q2 2025 consolidated statements of income show operating revenues of $1,420.5 million, net income of $36.0 million, and diluted EPS of $0.20 Consolidated Statements of Income (Q2 2025 vs Q2 2024) | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | | Operating revenues | $1,420.5 | $1,316.7 | | Total operating expenses | $1,365.5 | $1,265.7 | | Income from operations | $55.0 | $51.0 | | Net income | $36.0 | $35.3 | | Diluted earnings per share | $0.20 | $0.20 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=SCHNEIDER%20NATIONAL%2C%20INC.%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS%20%28Unaudited%29) As of June 30, 2025, total assets were $4,956.4 million, with cash at $160.7 million and shareholders' equity at $3,012.9 million Condensed Consolidated Balance Sheets (June 30, 2025 vs Dec 31, 2024) | Metric | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :-------------------------------- | :------------------------- | :--------------------------- | | Cash and cash equivalents | $160.7 | $117.6 | | Total Assets | $4,956.4 | $4,933.7 | | Long-term debt and finance lease obligations | $512.7 | $420.8 | | Shareholders' Equity | $3,012.9 | $2,986.9 | | Total Liabilities and Shareholders' Equity | $4,956.4 | $4,933.7 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=SCHNEIDER%20NATIONAL%2C%20INC.%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20%28Unaudited%29) For the six months ended June 30, 2025, net cash from operations was $267.2 million, resulting in a $43.1 million net increase in cash Condensed Consolidated Statements of Cash Flows (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------- | :-------------- | :-------------- | | Net cash provided by operating activities | $267.2 | $280.2 | | Net cash used in investing activities | $(180.0) | $(178.1) | | Net cash used in financing activities | $(44.1) | $(101.3) | | Net increase in cash and cash equivalents | $43.1 | $0.8 | | Net capital expenditures | $(149.6) | $(181.6) | Segment Financials and Key Performance Indicators [Revenues by Segment](index=7&type=section&id=Revenues%20by%20Segment) Q2 2025 segment revenues were Truckload $622.2 million, Intermodal $265.1 million, and Logistics $339.6 million, all showing growth Revenues by Segment (Q2 2025 vs Q2 2024) | Segment | Q2 2025 (Millions) | Q2 2024 (Millions) | | :-------------------------------- | :----------------- | :----------------- | | Truckload | $622.2 | $540.3 | | Intermodal | $265.1 | $253.1 | | Logistics | $339.6 | $318.8 | | Other | $96.8 | $95.6 | | Fuel surcharge | $138.5 | $148.8 | | Operating revenues | $1,420.5 | $1,316.7 | [Income (Loss) from Operations by Segment](index=7&type=section&id=Income%20%28Loss%29%20from%20Operations%20by%20Segment) Q2 2025 Truckload income from operations rose 31% to $40.1 million, Intermodal 10% to $16.1 million, while Logistics decreased 29% to $7.9 million Income (Loss) from Operations by Segment (Q2 2025 vs Q2 2024) | Segment | Q2 2025 (Millions) | Q2 2024 (Millions) | | :-------------------------------- | :----------------- | :----------------- | | Truckload | $40.1 | $30.7 | | Intermodal | $16.1 | $14.6 | | Logistics | $7.9 | $11.2 | | Other | $(9.1) | $(5.5) | | Income from operations | $55.0 | $51.0 | [Key Performance Indicators by Segment](index=8&type=section&id=Key%20Performance%20Indicators%20by%20Segment) [Truckload KPIs](index=8&type=section&id=Truckload%20KPIs) Truckload average truck count increased to 12,224 in Q2 2025, with Dedicated trucks up 27%; revenue per truck per week rose 1% to $3,964 Truckload Segment Key Performance Indicators (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Dedicated Revenues (excl. fuel surcharge) | $440.4M | $346.4M | 27% | | Dedicated Average trucks | 8,518 | 6,683 | 27% | | Dedicated Revenue per truck per week | $4,026 | $4,025 | 0% | | Network Revenues (excl. fuel surcharge) | $181.9M | $193.8M | (6%) | | Network Average trucks | 3,706 | 3,982 | (7%) | | Network Revenue per truck per week | $3,821 | $3,778 | 1% | | Total Truckload Average trucks | 12,224 | 10,665 | 15% | | Total Truckload Revenue per truck per week | $3,964 | $3,933 | 1% | | Operating ratio | 93.6% | 94.3% | 70 bps improvement | - Cowan Systems' dedicated operations are included in Dedicated beginning in the fourth quarter of 2024, contributing to the significant increase in Dedicated metrics[32](index=32&type=chunk) [Intermodal KPIs](index=9&type=section&id=Intermodal%20KPIs) Intermodal orders increased 5% to 108,218 in Q2 2025, with revenue per order stable at $2,443 and operating ratio improving to 93.9% Intermodal Segment Key Performance Indicators (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Orders | 108,218 | 103,088 | 5% | | Containers | 26,462 | 26,695 | (1%) | | Trucks | 1,442 | 1,408 | 2% | | Revenue per order | $2,443 | $2,446 | 0% | | Operating ratio | 93.9% | 94.2% | 30 bps improvement | [Logistics KPIs](index=9&type=section&id=Logistics%20KPIs) The Logistics segment's operating ratio decreased by 120 basis points to 97.7% in Q2 2025, reflecting lower operational efficiency Logistics Segment Key Performance Indicators (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Operating ratio | 97.7% | 96.5% | 120 bps decrease | - Cowan Systems' logistics operations are included in Logistics beginning in the fourth quarter of 2024[40](index=40&type=chunk) Forward-Looking Statements [Forward-Looking Statements](index=14&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements) This section contains cautionary forward-looking statements, noting actual results may differ materially due to various risks and uncertainties - The earnings release contains forward-looking statements reflecting current expectations, beliefs, plans, or forecasts, which are not guarantees of future performance[64](index=64&type=chunk) - Actual results could differ materially due to risks and uncertainties such as unfavorable economic and market conditions, competitive pressures, operational challenges, and regulatory impacts[65](index=65&type=chunk) - The Company undertakes no obligation to publicly release any revision to its forward-looking statements[66](index=66&type=chunk)

Summary of Schneider National (SNDR) 2025 Conference Call Company Overview - **Company**: Schneider National (SNDR) - **Date**: June 10, 2025 - **Speakers**: Mark Rourke (President and CEO), Daryl Campbell (EVP and CFO), Christine McGarvey (VP of Investor Relations) Current Market Conditions - **Market Sentiment**: There was significant uncertainty at the macro level, but the worst-case scenarios have not materialized, indicating a resilient consumer demand [6][7][8] - **Volume Trends**: A downturn in West Coast volumes was noted, but strength was observed in other regions, particularly in Mexico and the Midwest [9][10] - **Customer Expectations**: Mixed signals from customers regarding future demand, with some expecting a surge while others anticipate steady activity [10] Business Segments Performance - **Intermodal**: Less reliance on imports compared to truckload, with steady domestic demand. Productivity enhancements are being pursued [12][13] - **Capacity and Pricing**: The market is approaching equilibrium with modest price increases observed despite ongoing challenges [18][20] - **Used Truck Market**: Prices for used trucks, especially sleepers, have been healthy, indicating stress in the market for small carriers [22][24] Pricing Dynamics - **Contract Rates**: Contractual improvements are being maintained, with a focus on not signing unfavorable agreements [29][30] - **Spot vs. Contract Rates**: A significant disparity exists between spot and contract rates, with contract rates showing flat to positive trends [31][32] Cost Management and Productivity - **Cost Control**: The company has focused on cost management and productivity improvements, resulting in year-over-year margin improvements [38][40] - **Acquisition Synergies**: The recent Cowen acquisition is expected to yield synergistic opportunities, particularly in cost management [42][64] Regulatory Environment - **English Language Provision**: New enforcement guidelines for the English language requirement could disrupt the market, particularly for smaller carriers [46][50] - **B1 Mexican Program**: Increased enforcement may tighten capacity around the border, impacting operations [50][52] Intermodal Growth - **Market Position**: Schneider National is optimistic about intermodal growth, particularly in the Mexico market, with strong service performance noted [54][56] - **Pricing Trends**: Intermodal pricing remains flat to slightly up, with expectations for continued stability [63] Capital Allocation Strategy - **Growth Focus**: The company prioritizes organic growth but remains open to strategic acquisitions, particularly in dedicated and intermodal segments [64][66] - **Leverage Profile**: The company is comfortable with a leverage ratio of up to 2.5 times for the right acquisitions [70][72] Guidance and Outlook - **Earnings Guidance**: EPS guidance is set between $0.75 and $1.00, reflecting a more optimistic outlook than previously anticipated [80][82] - **Market Sentiment**: The negative forward sentiment has moderated, leading to a more favorable industry outlook [92] Key Takeaways - **Resilience in Demand**: The company is experiencing steady demand despite macroeconomic uncertainties - **Focus on Cost Management**: Continuous efforts in cost control and productivity enhancements are yielding positive results - **Strategic Growth Opportunities**: Schneider National is well-positioned for growth in intermodal and dedicated segments, with a balanced approach to capital allocation and acquisitions.

Investment Rating - The report does not explicitly state an investment rating for the transportation and logistics industry Core Insights - The report highlights a positive trend in U.S. imports, with a 6.1% week-over-week increase as of May 18, outperforming seasonal expectations by 980 basis points and showing a 2.8% year-over-year increase [2] - Spot rates for truckload transportation have surged, with dry van rates increasing by 6.1% week-over-week, outperforming historical averages [3] - There are concerns regarding potential freight demand impacts due to tariffs, with expectations of a flat outlook for dry van spot rates in 2026 [6] Summary by Sections Import & Congestion Monitor - Container bookings from China to the U.S. are at five-year lows, down 27% compared to 2023, indicating subdued future demand [2] - The report notes a recovery in container imports at the Port of LA/LB, which increased by 24% week-over-week [2] Truckload and Rail Data - Spot rates for dry van, reefers, and flatbed have all increased week-over-week, with dry van rates now 4% higher year-over-year [3] - The dry van load-to-truck ratio increased by 57% week-over-week, indicating a tightening market [6] - Rail management teams express skepticism about the feasibility of transcontinental mergers due to regulatory barriers [7] Airfreight & Surface Transportation - Airfreight rates have been monitored closely due to tariff implications, with significant declines observed in key freight lanes, particularly the China-U.S. lane, which fell by 6% week-over-week [10] - The overall airfreight market is experiencing broad-based weakness, with all major lanes underperforming seasonal expectations year-to-date [10] Rail Performance - The report card for railroads indicates varying performance levels, with some railroads rated as excellent while others are fair or poor [9] - Regulatory challenges are highlighted as a significant barrier to potential mergers in the rail industry, with environmental impact studies being particularly burdensome [7]

Core Insights - Schneider National, Inc. reported first-quarter 2025 earnings per share (EPS) of 16 cents, exceeding the Zacks Consensus Estimate of 14 cents and reflecting a 45% year-over-year improvement [1] - Operating revenues reached $1.40 billion, slightly below the Zacks Consensus Estimate of $1.44 billion, but showed a 6.2% year-over-year increase [1] - The company experienced a decline in consumer sentiment and market expectations due to increasing economic uncertainty [2] Financial Performance - Income from operations (adjusted) grew 47% year-over-year to $44.2 million [2] - Truckload revenues (excluding fuel surcharge) were $613.7 million, up 14% year-over-year, driven by the acquisition of Cowan Systems and improved revenue per truck per week [3] - Intermodal revenues (excluding fuel surcharge) increased 5% year-over-year to $260.4 million, supported by a 4% volume growth [5] - Logistics revenues (excluding fuel surcharge) reached $332.0 million, a 2% year-over-year increase [7] Segment Highlights - Truckload income from operations was $25.1 million, up 68% year-over-year, with an operating ratio improvement to 95.9% from 97.2% [4] - Intermodal income from operations surged 97% year-over-year to $13.8 million, with an operating ratio of 94.7% [6] - Logistics income from operations grew 50% year-over-year to $8.1 million, with an operating ratio of 97.6% [7] Liquidity and Cash Flow - Cash and cash equivalents at the end of the first quarter were $106.2 million, down from $117.6 million in the previous quarter [8] - Long-term debt increased to $565.8 million from $420.8 million [8] - The company generated $91.7 million in cash from operations during the quarter [8] Shareholder Returns and Guidance - Schneider announced a $150.0 million stock repurchase program, having repurchased 4.1 million Class B shares for $103.9 million as of March 31, 2025 [9] - A dividend of $0.095 per share was declared, payable on July 10, 2025 [9] - The company updated its 2025 adjusted EPS guidance to a range of 75 cents to $1.00, down from the previous range of 90 cents to $1.20 [10][11]