Financial Data and Key Metrics Changes - The second quarter revenue decreased year over year by 0.7% to $817.1 million, with operating ratio at 87.8% compared to 83.3% in the same quarter last year [5][14][18] - Revenue per shipment excluding fuel surcharge increased by 2.7% to $298.71, while including fuel surcharge it increased by 1.8% to $351.36 [14][18] - Total operating expenses increased by 4.7% year over year, with salaries, wages, and benefits rising by 5% due to inflationary pressures [15][18] Business Line Data and Key Metrics Changes - Overall shipments for workdays were down 2.8% year over year, with tonnage only up 0.4% from the first quarter [6][8] - Newer terminals (opened less than three years) saw a 4% sequential improvement in shipments per workday compared to the first quarter [7] - Legacy facilities (open longer than three years) experienced a 2% sequential increase in shipments compared to the first quarter, but down 3.5% year over year [7] Market Data and Key Metrics Changes - The company noted muted volume trends due to the macroeconomic landscape, with overall shipment trends reflecting cautious customer approaches [6][8] - The Los Angeles region showed softer trends, impacting overall performance [9][52] Company Strategy and Development Direction - The company is focused on optimizing variable costs and improving network efficiency while maintaining a customer-centric approach [5][10] - There is an emphasis on getting closer to customers and providing unique solutions, which is part of the long-term strategy [21][22] - The company plans to continue investing in network expansion and technology to enhance operational efficiency [17][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to adapt to the dynamic environment, despite the lack of typical volume increases in the second quarter [20] - The focus remains on controllable factors, with a commitment to maintaining high service levels and managing costs effectively [10][20] - Future growth is anticipated as the company continues to mature its facilities and optimize its network [11][106] Other Important Information - The company plans to spend approximately $600 million to $650 million in capital expenditures this year, focusing on network expansion and technology investments [17][99] - The cargo claims ratio was reported at 0.5, indicating effective management of claims [10] Q&A Session Summary Question: Outlook on volumes and pricing for Q3 - Management indicated that tonnage comparisons will become tougher due to new terminal openings last year, but they expect to maintain pricing discipline [26][27] Question: Labor reductions and wage increases - Management clarified that wage increases typically occur in the second half of the year, and headcount adjustments are made to align with volume levels [35][36] Question: Industry capacity and pricing recovery - Management believes that LTL capacity is shrinking over time, and they are well-positioned to leverage their investments in the upcoming market recovery [44][46] Question: Volume trends in July - July tonnage is trending flat, with shipments per day down about 2.25%, reflecting ongoing cautiousness in the market [51][52] Question: Contractual renewals and competitive pricing - The 5.1% renewal rate is lower than previous periods, but management emphasized that the pricing environment remains rational and focused on service quality [58][60] Question: Cost management and operating leverage - Management noted that while some cost actions are tactical, they are also building long-term structural gains through network optimization [67][70] Question: Pricing environment and legacy freight - Management is optimistic about pricing opportunities as they continue to optimize their network and improve service levels [73][75]