Sales Forecast - New U.S. Class 8 retail truck sales are forecasted to be 216,300 units in 2025, representing a 12.5% decrease compared to 2024[64] - The company expects to sell approximately 11,700 to 12,800 new Class 8 trucks in 2025, with a market share of 5.4% to 5.9%[64] - New U.S. Class 4 through 7 retail commercial vehicle sales are projected to be 227,225 units in 2025, an 11.8% decrease from 2024[65] - The company anticipates selling approximately 12,500 to 13,600 new Class 4 through 7 commercial vehicles in 2025[65] Revenue and Profitability - Lease and rental revenue is expected to increase by approximately 4.5% in 2025 compared to 2024[66] - Aftermarket Products and Services revenue showed a slight increase in Q3 2025 compared to Q3 2024, but is expected to remain flat to slightly down in Q4 2025[67] - New heavy-duty vehicle sales decreased by 10.8% in Q3 2025 compared to Q3 2024, with revenues dropping by 12.7%[72] - New light-duty vehicle sales increased by 49.5% in Q3 2025 compared to Q3 2024, with revenues rising by 48.0%[72] - Total new vehicle revenue decreased by 3.5% in Q3 2025 compared to Q3 2024, totaling $1,035.2 million[72] - Total revenues decreased by $15.4 million, or 0.8%, in Q3 2025 compared to Q3 2024, primarily due to decreased new Class 8 truck sales[74] - Aftermarket Products and Services revenues totaled $642.7 million in Q3 2025, up 1.5% from Q3 2024, driven by strategic initiatives and increased parts pricing[75] - Sales of new and used commercial vehicles decreased by $28.4 million, or 2.4%, in Q3 2025, attributed to reduced demand from challenging market conditions[76] - Gross profit decreased by $4.3 million, or 1.1%, in Q3 2025, with gross profit as a percentage of sales at 19.9%, down from 20.0% in Q3 2024[82] - SG&A expenses increased by $16.7 million, or 12.6%, in Q3 2025, representing 13.6% of total revenues, up from 12.6% in Q3 2024[88] - Income before income taxes decreased by $15.4 million, or 14.9%, in Q3 2025 compared to Q3 2024[90] Cash Flow and Capital Expenditures - During the first nine months of 2025, net cash provided by operating activities was $748.9 million, compared to $227.3 million in the same period of 2024[116][118] - Cash used in investing activities during the first nine months of 2025 was $330.2 million, primarily for the acquisition of property and equipment[119] - Financing activities resulted in net cash used of $404.9 million in the first nine months of 2025, primarily due to $997.5 million in principal repayments of long-term debt[121] - The company expects to purchase or lease commercial vehicles worth approximately $275.0 million to $325.0 million during 2025, depending on customer demand[110] - The company anticipates funding capital expenditures through operating cash flows and has sufficient liquidity to meet debt service and working capital requirements for at least the next twelve months[107] Debt and Financing - As of September 30, 2025, the company had approximately $220.0 million outstanding under the PLC Agreement for financing capital expenditures[124] - The company entered into the PFC Floor Plan Credit Agreement with an aggregate loan commitment of $800.0 million for financing new Peterbilt trucks, with approximately $480.0 million outstanding as of September 30, 2025[127] - The BMO Floor Plan Credit Agreement was amended to reduce the loan commitment from $1.0 billion to $675.0 million, with approximately $317.9 million outstanding as of September 30, 2025[128] - The RTC Canada Floor Plan Credit Agreement was amended to increase the loan commitment to $171.7 million CAD, with approximately $97.3 million CAD outstanding as of September 30, 2025[129] - As of September 30, 2025, the company had floor plan borrowings totaling $1,120.9 million, with interest expense potentially increasing or decreasing by approximately $11.2 million for a 100 basis point change in SOFR, CORRA, or the prime rate[142] Market Conditions and Backlog - The company's backlog of commercial vehicle orders decreased to approximately $647.6 million as of September 30, 2025, down from approximately $1,332.9 million a year earlier, reflecting challenging industry conditions[130] - The company’s Truck Segment is moderately seasonal, with higher sales volumes historically occurring in the second and third quarters[131] - The company’s business is subject to cyclical variations, with total U.S. retail sales of new Class 8 commercial vehicles ranging from approximately 197,000 in 2016 to approximately 281,440 in 2019[132] Environmental Regulations - The company is subject to various environmental regulations, which may incur capital and operating expenditures, but currently does not believe it has any material environmental liabilities[137] - The EPA's GHG-3 rule and the 2027 Low NOx rule may significantly impact the manufacturing of diesel internal combustion engines, with compliance potentially requiring an increasing percentage of zero-emission vehicles[138] - The Clean Truck Partnership was established to comply with CARB's emission requirements, although its future is uncertain due to ongoing legal challenges[140]
Rush Enterprises(RUSHB) - 2025 Q3 - Quarterly Report