Summary of Schneider National FY Conference Call - September 11, 2025 Company Overview - **Company**: Schneider National (NYSE: SNDR) - **Key Executives Present**: CEO Mark Rourke, CFO Darrell Campbell, VP of IR and Corporate Finance Christyne McGarvey Industry Insights - **Current Market Conditions**: The trucking and intermodal sectors are experiencing steady demand, with some seasonal fluctuations expected. The second quarter did not show the anticipated pull forward in demand, and August was characterized as slightly below seasonal expectations [2][5][8]. - **Intermodal Demand**: There is uncertainty regarding inventory levels, particularly on the West Coast, which could affect intermodal movements. The company anticipates a potential ramp down in intermodal demand sooner than typical, possibly before December [5][6][8]. - **Truckload Market**: Demand has improved, with mid to single-digit increases in contractual renewals. The company is prepared to capitalize on seasonal opportunities in the fourth quarter [9][10]. Financial Performance - **Contractual Renewals**: The company is experiencing mid to single-digit increases in contractual renewals, with more flexibility in the spot market [9]. - **Churn Rates**: The company has experienced higher customer churn in dedicated services compared to the previous year, but retention rates remain above 90% [19][22]. - **Pipeline for Dedicated Services**: The pipeline has returned to levels seen in 2024, indicating potential growth despite current market conditions [20]. Strategic Focus - **Dedicated vs. One-Way Services**: Schneider National is focusing on dedicated services, which account for 70% of its truck fleet. This strategy is aimed at providing stable revenue streams and meeting driver preferences for scheduled routes [16][17]. - **Private Fleet Conversions**: There is a notable shift in the market, with an increase in private fleets. The company sees opportunities for converting these fleets back to dedicated services as customers reassess their needs [24][25][28]. - **Capacity Constraints**: The company acknowledges that industry capacity is tightening due to regulatory enforcement and a lack of new truck orders. This could lead to a more favorable environment for established players [30][32]. Technological Advancements - **AI and Automation**: Schneider National is leveraging AI to improve productivity in its brokerage operations, achieving a 61% year-over-year improvement in carrier-broker matching [61][62]. - **Autonomous Vehicles**: The company is optimistic about the future of autonomous trucking but is focused on understanding the economic models and operational integration before making significant investments [73][75]. Environmental Initiatives - **Electric Vehicles (EVs)**: The company operates around 100 Class 8 electric trucks in California, with plans to explore natural gas options more aggressively than electric in the near term due to current market conditions [76][77]. M&A Strategy - **Acquisition Plans**: Schneider National aims to pursue strategic acquisitions every 12 to 18 months, focusing on areas that enhance growth and return on investment. The company is not currently looking to expand into LTL but remains open to transformative opportunities [80][83]. Conclusion - Schneider National is navigating a complex market landscape with a focus on dedicated services, technological advancements, and strategic growth through acquisitions. The company is well-positioned to adapt to changing market conditions while maintaining a strong operational focus.

Core Insights - Schneider National, Inc. (NYSE:SNDR) is recognized as one of the best freight stocks to invest in currently, despite mixed second-quarter earnings results [1] Financial Performance - The company reported a 10% increase in enterprise revenues, excluding fuel surcharge, compared to the previous year [2] - Truckload earnings saw a 60% sequential increase and a 30% year-over-year increase [2] - The Intermodal segment experienced its fifth consecutive growth in volumes, attributed to strong rail relationships and an expanding presence in Mexico [2] Challenges and Risks - Inflationary pressures in areas such as accident claims and equipment-related costs are creating headwinds for the company [3] - Current trade uncertainties and shifting trade policies are expected to significantly impact the company in the second half of 2025 [3] Executive Actions and Market Sentiment - Executive Vice President Thomas Jackson sold 36,596 shares valued at $891,567, possibly reflecting the mixed results [4] - The company has 18 hedge funds invested in its stock, indicating a balanced risk and reward opportunity with an upside potential of 9.98% [4] Company Overview - Schneider National, Inc. is a major transportation and logistics company based in Wisconsin, founded in 1935, offering services such as truckload, intermodal, and dedicated freight shipping [5]

Core Viewpoint - The article discusses the current state of the freight market, highlighting the impact of political maneuvers and shifting trade flows on investment opportunities in freight stocks [1][2]. Industry Overview - The shipping industry accounts for nearly 3% of global CO2 emissions and facilitates about 90% of worldwide trade, indicating its significant role in the global economy [2]. - Recent U.S. political actions, including pressure on other countries regarding marine fuel emissions cuts, add uncertainty for investors in freight-related assets [2]. Investment Strategy - Investors in the freight sector must balance short-term regulatory changes with the long-term benefits of increasing trade volumes [3]. - A list of 13 freight stocks is compiled based on criteria such as hedge fund interest and potential upside, aiming to identify stocks that can deliver healthy returns [5][6]. Company Highlights - **Schneider National, Inc. (NYSE:SNDR)**: - Reported a 10% increase in enterprise revenues (excluding fuel surcharge) year-over-year and a 30% increase in truckload earnings [9]. - Faces inflationary pressures and trade uncertainties, but has 18 hedge funds invested and an upside potential of 9.98% [11]. - **ArcBest Corporation (NASDAQ:ARCB)**: - Q2 2025 revenue was $1 billion, down from $1.1 billion the previous year, with net income from continuing operations at $25.8 million [14]. - Experienced a 4.3% increase in tonnage per day and a 5.6% increase in daily shipments, with 22 hedge funds invested and an upside potential of 12.95% [15].

Core Insights - Schneider National, Inc. (SNDR) is facing increased cost pressures due to supply-chain disruptions and inflation, alongside a soft freight market, making it an unattractive investment choice [1] Financial Performance - The Zacks Consensus Estimate for current-quarter earnings has been revised downward by 4.4% to 22 cents per share, with a 2.33% decline in the 2025 earnings estimate to 84 cents per share, indicating a lack of confidence from brokers [2] - SNDR's shares have decreased by 15.6%, while the Transportation - Services industry has only seen a 0.3% decline [3][7] - The company has a mixed earnings surprise history, outperforming the Zacks Consensus Estimate in three of the last four quarters, with an average surprise of 1.86% [5] Cost Pressures - Operating expenses rose by 7.9% in Q2 2025, primarily due to a 13.3% increase in labor costs, which constitute 29.2% of total operating costs [7][9] - The logistics segment's profit fell by 29%, with the operating ratio worsening to 97.7%, reflecting a decline in efficiency [10] - Rising insurance expenses and a soft freight market are further undermining SNDR's financial performance [9] Industry Context - Schneider National belongs to an industry with a Zacks Industry Rank of 224 out of 245, placing it in the bottom 9% of Zacks Industries, which significantly impacts stock price movements [6] - The company is struggling with mounting cost pressures that are heavily affecting its bottom line, particularly in the logistics business [8]

Core Insights - Schneider National, Inc. (SNDR) reported second-quarter 2025 earnings per share (EPS) of 21 cents, matching the Zacks Consensus Estimate and the previous year's figure [1][8] - Operating revenues reached $1.42 billion, slightly missing the Zacks Consensus Estimate by 0.2%, but showing an 8% year-over-year improvement [1][8] - Income from operations (adjusted) grew 9% year over year to $56.8 million [1] Segment Performance - Truckload revenues (excluding fuel surcharge) for Q2 2025 were $622.2 million, a 15% increase year over year, driven by a 23% rise in Dedicated volume due to the acquisition of Cowan Systems [2] - Truckload income from operations was $40.1 million, up 31% year over year, with an operating ratio improving to 93.6% from 94.3% [3] - Intermodal revenues (excluding fuel surcharge) were $265.1 million, a 5% increase year over year, with income from operations rising 10% to $16.1 million [3][4] - Logistics revenues (excluding fuel surcharge) reached $339.6 million, up 7% year over year, but income from operations fell 29% to $7.9 million due to lower brokerage volume [5] Liquidity and Cash Flow - At the end of Q2, Schneider had cash and cash equivalents of $160.7 million, up from $106.2 million in the previous quarter, and long-term debt decreased to $512.7 million [6] - The company generated $175.5 million in cash from operations during the quarter, with net capital expenditures at $52.5 million [6] Shareholder Returns and Guidance - Schneider announced a $150 million stock repurchase program, having repurchased 4.1 million Class B shares for $103.9 million as of June 30, 2025 [7] - A dividend of $0.095 was declared, payable on October 9, 2025, with $33.7 million returned to shareholders in dividends year to date [7] - The company revised its 2025 adjusted EPS guidance to a range of 75 cents to 95 cents, down from the previous range of 75 cents to $1.00 [9][10]

Core Insights - Schneider National reported Q2 2025 earnings with GAAP revenue of $1,420.5 million, slightly exceeding analyst estimates of $1,412.24 million, and adjusted diluted EPS of $0.21, above the consensus of $0.20, indicating operational resilience despite market challenges [1][2][5] Financial Performance - Adjusted EPS remained flat at $0.21 compared to Q2 2024, while revenue increased by 7.9% year-over-year from $1,316.7 million [2][5] - Operating income rose to $55.0 million, a 7.8% increase, and net income reached $36.0 million, up 2% from the previous year [2][5] - Wage and benefit costs increased by 13.3% year-over-year, totaling $399.3 million, while cash and cash equivalents improved to $160.7 million [10] Business Segments Overview - The Truckload segment saw a 15% revenue increase year-over-year, driven by the integration of Cowan Systems and a 27% rise in average truck count [6][11] - Intermodal segment revenue grew by 5%, with a 10% increase in income from operations, supported by new business wins [7][12] - Logistics segment experienced a 7% revenue growth but faced a 29% decline in income from operations due to lower brokerage volume [8][13] Strategic Focus and Initiatives - The company is focused on expanding its portfolio through acquisitions and investing in technology, particularly artificial intelligence, to enhance efficiency and manage costs [4][14] - The acquisition of Cowan Systems has bolstered the Dedicated Truckload business, contributing to fleet growth and operational improvements [4][11] - Management aims for $40 million in annualized savings from technology investments, emphasizing cost reduction and productivity [14] Guidance and Future Outlook - Updated guidance for FY2025 adjusted diluted EPS is now projected at $0.75–$0.95, reflecting continued growth expectations [15] - Net capital expenditures are targeted between $325–$375 million for the full year, with an effective tax rate projected at 23.0% to 24.0% [15] - Ongoing challenges include trade-policy uncertainty, high industry capacity, and wage inflation, with a focus on pricing recovery and strategic acquisitions [16]

[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]