Schneider National Inc.

02/20/2026 | Press release | Distributed by Public on 02/20/2026 14:36

Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the accompanying consolidated financial statements and related notes.
INTRODUCTION
Company Overview
We provide a comprehensive portfolio of transportation and logistics services, including truckload, intermodal, and logistics solutions, enabling us to meet diverse customer needs through an integrated, multimodal approach.
Strategy
We seek to deliver a resilient, high-quality portfolio of transportation and logistics services designed to support consistent revenue growth, margin performance, and long-term shareholder value. Our strategy reflects Schneider's commitment to high-quality service, operational excellence, and disciplined capital deployment across economic and freight cycles, and it is grounded in our purpose to turn complexity into control for our customers and elevate transportation into a strategic advantage for them. We advance this strategy through five priorities:
Leverage core strengths to drive organic growth and advance our market position
We continue to grow organically by building on our core strengths - our broad, multi-modal service offerings, strong balance sheet, robust safety practices, and advanced technology solutions - while deepening relationships with existing customers and expanding our reach with new ones. Our diversified portfolio, spanning multiple asset intensities and transportation modes, provides customers with flexible and reliable supply chain options across North America intended to provide resiliency amid shifting market conditions.
We manage growth with a focus on profitability and stakeholder considerations. Our integrated technology platform supports real-time visibility, data-driven decision support, and increased network efficiency. Combined with an agile, solutions-oriented commercial organization, these capabilities are designed to support service quality and share capture across our reportable segments.
Expand capabilities in the specialty, dedicated, and asset-light services
We plan to grow in specialty and dedicated transportation markets, where operational complexity and elevated service requirements can support deeper customer relationships. Our scale, specialized equipment, and experienced driver base support our ability to serve freight needs - including those with specific handling, timing, or regulatory requirements - and we maintain programs designed to support compliance and dependable execution.
We also continue to advance our multimodal strategy. As an asset-based intermodal provider, we maintain control of equipment, dray capacity, and service quality through differentiated rail relationships and an integrated technology backbone. These capabilities are intended to enhance service consistency, end-to-end visibility, and customer outcomes.
Our Logistics business, including freight brokerage, remains a strategic growth engine. Our FreightPower® digital marketplace, broad carrier network, and Power Only solutions give shippers access to competitive, scalable capacity. In 2025, we implemented stricter qualification requirements for certain third-party carriers in response to cargo theft concerns, which reduced the number of carriers in our network and influenced volume and mix within the period. Logistics also plays a role in innovation, including analytics, AI-enabled automation, and customer experience design.
Improve operations and margins through technology and business transformation
Technology remains fundamental to our efforts to enhance efficiency, service quality, and network performance. We continue investing in digital tools and AI solutions that improve load matching, optimize resources, and streamline operations with greater control and precision across all segments. These initiatives affect operating expenses and are expected to influence productivity and our cost structure over time. These capabilities also support driver satisfaction by aligning routes, schedules, and preferences more accurately.
Customer interfaces emphasize simplicity and transparency. Our FreightPower® platform further connects our asset-based network with broader third-party capacity, while our next-generation transportation management system is expected to further enhance the scalability and intelligence of our ecosystem. We believe these transformation efforts will support productivity, revenue management, and analytics-driven decisioning over time.
Allocate capital to maximize returns while pursuing strategic growth opportunities
Our multimodal portfolio provides flexibility to deploy capital where returns are believed to be most attractive across varying market conditions. We strategically shift assets and investments across business lines and geographies to optimize utilization and financial performance.
Our strong financial position enables disciplined investments in fleet modernization, technology, safety enhancements, and network capacity, as well as targeted acquisitions that enhance our service offerings, expand customer relationships, or strengthen capabilities. Each investment is guided by return-on-capital discipline and aligned with long-term strategic priorities, ensuring that we seek to deliver on behalf of shareholders and customers.
Create differentiated driver and associate experiences to attract and retain top talent
Our people remain our greatest competitive advantage. We foster a high-performance, safety-first culture rooted in collaboration, inclusion, and continuous improvement.
We are committed to improving the driver experience through better home-time balance, consistent freight, enhanced technology tools, and a clear focus on safety and well-being. For all associates, we invest in training, leadership development, and career progression.
Our talent systems, from recruiting to onboarding to ongoing engagement, are increasingly enabled by technology, helping us identify and support high-quality drivers and skilled professionals who grow with the company.
RESULTS OF OPERATIONS
A discussion regarding our financial condition and results of operations for fiscal 2025 compared to fiscal 2024 is presented below. A discussion regarding our financial condition and results of operations for fiscal 2024 compared to fiscal 2023 can be found under Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," in our Annual Report on the Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on February 21, 2025 and is available on the SEC's website, www.sec.gov, as well as the "Investors" section of our website at www.schneider.com.
Non-GAAP Financial Measures
In this section of our report, we present the following non-GAAP financial measures: (1) revenues (excluding fuel surcharge), (2) adjusted income from operations, (3) adjusted total operating expenses, net of fuel surcharge revenues, (4) adjusted operating ratio, (5) adjusted net income, (6) adjusted EBITDA, and (7) free cash flow. We also provide reconciliations of these measures to the most directly comparable financial measures calculated and presented in accordance with GAAP.
Management believes the use of each of these non-GAAP measures assists investors in understanding our business by (1) removing the impact of items from our operating results that, in our opinion, do not reflect our core operating performance, (2) providing investors with the same information our management uses internally to assess our core operating performance, and (3) presenting comparable financial results between periods. In addition, in the case of revenues (excluding fuel surcharge) and adjusted total operating expenses, net of fuel surcharge revenues, we believe these measures are useful to investors because they isolate volume, price, and cost changes directly related to industry demand and the way we operate our business from the external factor of fluctuating fuel prices and the programs we have in place to manage such fluctuations. Fuel-related costs and their impact on our industry are important to our results of operations, but they are often independent of other, more relevant factors affecting our results of operations and our industry. Free cash flow is used as a measure to assess overall liquidity and does not represent residual cash flow available for discretionary expenditures as it excludes certain mandatory expenditures such as repayment of maturing debt.
Although we believe these non-GAAP measures are useful to investors, they have limitations as analytical tools and may not be comparable to similar measures disclosed by other companies. You should not consider the non-GAAP measures in this report in isolation or as substitutes for, or alternatives to, analysis of our results as reported under GAAP. The exclusion of unusual or infrequent items or other adjustments reflected in the non-GAAP measures should not be construed as an inference that our future results will not be affected by unusual or infrequent items or other items similar to such adjustments. Our management compensates for these limitations by relying primarily on our GAAP results in addition to using the non-GAAP measures.
Enterprise Summary
The following table includes key GAAP and non-GAAP financial measures for the consolidated enterprise. Adjustments to arrive at non-GAAP measures are made at the enterprise level, with the exception of fuel surcharge revenues, which are not included in segment revenues.
Year Ended December 31,
(in millions, except ratios) 2025 2024
Operating revenues $ 5,674.3 $ 5,290.5
Revenues (excluding fuel surcharge) (1)
5,093.9 4,714.3
Income from operations 168.9 165.2
Adjusted income from operations (2)
177.6 172.2
Operating ratio 97.0 % 96.9 %
Adjusted total operating expenses, net of fuel surcharge revenues (3)
4,916.3 4,542.1
Adjusted operating ratio (4)
96.5 % 96.3 %
Net income $ 103.6 $ 117.0
Adjusted net income (5)
110.2 122.3
Adjusted EBITDA (6)
617.5 580.2
Cash flow from operations 637.4 686.1
Free cash flow (7)
348.2 305.8
(1)We define "revenues (excluding fuel surcharge)" as operating revenues less fuel surcharge revenues, which are excluded from revenues at the segment level. Included below is a reconciliation of operating revenues, the most closely comparable GAAP financial measure, to revenues (excluding fuel surcharge).
(2)We define "adjusted income from operations" as income from operations, adjusted to exclude material items that do not reflect our core operating performance. Included below is a reconciliation of income from operations, which is the most directly comparable GAAP measure, to adjusted income from operations. Excluded items for the periods shown are explained in the table and notes below.
(3)We define "adjusted total operating expenses, net of fuel surcharge revenues" as total operating expenses, adjusted to exclude fuel surcharge revenues and certain expenses that do not reflect our core operating performance. Excluded expenses for the periods shown are explained below under our explanation of "adjusted income from operations."
(4)We define "adjusted operating ratio" as total operating expenses, adjusted to exclude material items that do not reflect our core operating performance, divided by revenues (excluding fuel surcharge). Included below is a reconciliation of operating ratio, which is the most directly comparable GAAP measure, to adjusted operating ratio. Excluded expenses for the periods shown are explained below under our explanation of "adjusted income from operations."
(5)We define "adjusted net income" as net income, adjusted to exclude material items that do not reflect our core operating performance. Included below is a reconciliation of net income, which is the most directly comparable GAAP measure, to adjusted net income. Excluded expenses for the periods shown are explained below under our explanation of "adjusted income from operations."
(6)We define "adjusted EBITDA" as net income, adjusted to exclude net interest expense, our provision for income taxes, depreciation and amortization, and certain items that do not reflect our core operating performance. Included below is a reconciliation of net income, which is the most directly comparable GAAP measure, to adjusted EBITDA.
(7)We define "free cash flow" as net cash provided by operating activities less net cash used for capital expenditures. Included below is a reconciliation of net cash provided by operating activities, which is the most directly comparable GAAP measure, to free cash flow.
Revenues (excluding fuel surcharge)
Year Ended December 31,
(in millions) 2025 2024
Operating revenues $ 5,674.3 $ 5,290.5
Less: Fuel surcharge revenues 580.4 576.2
Revenues (excluding fuel surcharge) $ 5,093.9 $ 4,714.3
Adjusted income from operations
Year Ended December 31,
(in millions) 2025 2024
Income from operations $ 168.9 $ 165.2
Acquisition-related costs (1)
0.2 2.0
Intangible asset amortization(2)
7.1 5.0
Severance (3)
1.4 -
Adjusted income from operations $ 177.6 $ 172.2
(1)Advisory, legal, and accounting costs related to the Company's acquisitions. Refer to Note 2, Acquisitions, for additional details.
(2)Amortization expense related to intangible assets acquired through recent business acquisitions. Although intangible assets contribute to our revenue generation, the amortization of intangible assets does not directly relate to transportation services provided to our customers. Refer to Note 6, Goodwill and Other Intangible Assets, for additional details.
(3)Severance related to workforce rightsizing.
Adjusted operating ratio
Year Ended December 31,
(in millions, except ratios) 2025 2024
GAAP Presentation
Operating revenues $ 5,674.3 $ 5,290.5
Total operating expenses 5,505.4 5,125.3
Income from operations $ 168.9 $ 165.2
Operating ratio (1)
97.0 % 96.9 %
Non-GAAP Presentation
Operating revenues $ 5,674.3 $ 5,290.5
Less: Fuel surcharge revenues 580.4 576.2
Revenues (excluding fuel surcharge) $ 5,093.9 $ 4,714.3
Total operating expenses $ 5,505.4 $ 5,125.3
Adjusted for:
Fuel surcharge revenues (580.4) (576.2)
Acquisition-related costs (0.2) (2.0)
Intangible asset amortization (7.1) (5.0)
Severance (1.4) -
Adjusted total operating expenses, net of fuel surcharge revenues(2)
$ 4,916.3 $ 4,542.1
Adjusted operating ratio (3)
96.5 % 96.3 %
(1) Calculated as total operating expenses divided by operating revenues.
(2) Adjusted total operating expenses, net of fuel surcharge revenues are defined as total operating expenses, adjusted to exclude fuel surcharge revenues and certain expenses that do not reflect our core operating performance.
(3) Calculated as adjusted total operating expenses, net of fuel surcharge revenues divided by revenues (excluding fuel surcharge).
Adjusted net income
Year Ended December 31,
(in millions) 2025 2024
Net income $ 103.6 $ 117.0
Acquisition-related costs 0.2 2.0
Intangible asset amortization 7.1 5.0
Severance 1.4 -
Income tax effect of non-GAAP adjustments (1)
(2.1) (1.7)
Adjusted net income $ 110.2 $ 122.3
(1)Our estimated tax rate on non-GAAP items is determined annually using the applicable consolidated federal and state effective tax rate, modified to remove the impact of tax credits and adjustments that are not applicable to the specific items. Due to differences in the tax treatment of items excluded from non-GAAP income, as well as the methodology applied to our estimated annual tax rates as described above, our estimated tax rate on non-GAAP items may differ from our GAAP tax rate and from our actual tax liabilities.
Adjusted EBITDA
Year Ended
December 31,
(in millions) 2025 2024
Net income $ 103.6 $ 117.0
Interest expense, net 27.9 12.3
Provision for income taxes 34.4 35.2
Depreciation and amortization 450.0 413.7
Acquisition-related costs 0.2 2.0
Severance 1.4 -
Adjusted EBITDA $ 617.5 $ 580.2
Free cash flow
Year Ended
December 31,
(in millions) 2025 2024
Net cash provided by operating activities $ 637.4 $ 686.1
Purchases of transportation equipment (352.0) (414.0)
Purchases of other property and equipment (32.8) (65.1)
Proceeds from sale of property and equipment 95.6 98.8
Net capital expenditures (289.2) (380.3)
Free cash flow $ 348.2 $ 305.8
Year Ended December 31, 2025 Compared to Year Ended December 31, 2024
Enterprise Results Summary
Enterprise net income decreased $13.4 million, approximately 11%, for the year ended December 31, 2025 compared to 2024. The decline was primarily driven by a $17.9 million unfavorable change in total other expenses (income)-net, largely attributable to a $17.2 million increase in interest expense, which was partially offset by a $3.7 million increase in income from operations, as discussed below.
Adjusted net income decreased $12.1 million, approximately 10%, for the same reasons discussed above.
Components of Enterprise Net Income
Enterprise Revenues
Enterprise operating revenues increased $383.8 million, approximately 7%, for the year ended December 31, 2025 compared to 2024.
Contributing factors were as follows:
•a $299.7 million increase in Truckload segment revenues (excluding fuel surcharge) driven by increased volume within Dedicated (primarily due to the Cowan acquisition) and increased rate per loaded mile in Network, partially offset by decreased Network volume;
•a $51.7 million increase in Logistics segment revenues (excluding fuel surcharge) resulting from the Cowan acquisition, partially offset by reduced volume within brokerage; and
•a $33.9 million increase in Intermodal segment revenues (excluding fuel surcharge) attributable to increased volume.
Enterprise revenues (excluding fuel surcharge) increased $379.6 million, approximately 8%.
Enterprise Income from Operations and Operating Ratio
Enterprise income from operations increased $3.7 million, approximately 2%, for the year ended December 31, 2025 compared to 2024. The increase was driven by higher volumes within Dedicated related to the Cowan acquisition, increased Intermodal volume, improved rates in Network, and lower purchased transportation costs. These were partially offset by higher salaries and wages, equipment-related costs, and depreciation and amortization (all largely stemming from the Cowan acquisition), as well as increased insurance expense from premiums and prior year claims development and lower brokerage volume.
Adjusted income from operations increased $5.4 million, approximately 3%.
Enterprise operating ratio (operating expenses as a percentage of operating revenues) increased slightly on both a GAAP and adjusted basis when compared to 2024.
Enterprise Operating Expenses
Key operating expense fluctuations year over year are summarized below.
•Purchased transportation costs decreased $11.3 million, or 1%, primarily due to lower third-party carrier costs within Logistics driven by reduced brokerage volume and lower rail-related costs. This was partially offset by higher third-party and owner-operator purchased transportation costs associated with the Cowan acquisition.
•Salaries, wages, and benefits increased $185.3 million, or 13% driven by higher driver pay, office wages, and benefits largely attributable to the Cowan acquisition.
•Fuel and fuel taxes for company trucks increased $36.3 million, or 9%, due to increased Dedicated volume (primarily driven by the Cowan acquisition), partially offset by lower Network volumes and a lower average cost per gallon. A significant portion of fuel costs are recovered through our fuel surcharge programs.
•Depreciation and amortization increased $36.3 million, or 9%, mainly due to additional depreciation expense associated with tractor and trailer growth within Dedicated (largely resulting from the Cowan acquisition).
•Operating supplies and expenses-net increased $88.8 million, or 14%, driven by equipment-related expenses primarily related to the Cowan acquisition, partially offset by higher gains on equipment sales.
•Insurance and related expenses increased $35.9 million, or 24%, due to an increase in auto liability insurance costs related to an increase in premiums, inclusive of Cowan, and unfavorable prior year claims development.
•Other general expenses increased $8.8 million, or 7%, largely due to higher driver onboarding costs driven by increased hires.
Total Other Expenses (Income)
Total other expenses increased $17.9 million, approximately 138%, for the year ended December 31, 2025 compared to 2024. This increase was driven by a $17.2 million increase in interest expense, partially offset by higher interest income. The increase in interest expense included $13.7 million attributable to a higher average balance of outstanding debt related primarily to the Cowan acquisition completed in December 2024. The remaining increase resulted from interest accruing in connection with a legal liability incurred due to an adverse verdict associated with a 2017 incident. Interest will continue to accrue until the matter is resolved, and we are unable to estimate the timeline for resolution.
Income Tax Expense
Our provision for income taxes decreased $0.8 million, approximately 2%, in the year ended December 31, 2025 compared to 2024 driven by lower taxable income, partially offset by a higher effective tax rate. The effective income tax rate was 24.9% for the year ended December 31, 2025 compared to 23.1% in 2024. Our provision for income taxes may fluctuate in future periods to the extent tax laws and regulations change.
Revenues and Income (Loss) from Operations by Segment
The following tables summarize revenues and income (loss) from operations by segment.
Year Ended December 31,
Revenues by Segment (in millions)
2025 2024
Truckload $ 2,470.4 $ 2,170.7
Intermodal 1,075.1 1,041.2
Logistics 1,333.0 1,281.3
Other 392.6 383.9
Fuel surcharge 580.4 576.2
Inter-segment eliminations (177.2) (162.8)
Operating revenues $ 5,674.3 $ 5,290.5
Year Ended December 31,
Income (Loss) from Operations by Segment (in millions)
2025 2024
Truckload $ 108.0 $ 89.1
Intermodal 64.7 54.5
Logistics 25.0 32.7
Other (28.8) (11.1)
Income from operations 168.9 165.2
Adjustments:
Acquisition-related costs 0.2 2.0
Intangible asset amortization 7.1 5.0
Severance 1.4 -
Adjusted income from operations $ 177.6 $ 172.2
We monitor and analyze a number of KPIs to manage our business and evaluate our financial and operating performance.
Truckload
The following table presents our Truckload segment KPIs for the periods indicated, consistent with how revenues and expenses are reported internally for segment purposes. The two operations that make up our Truckload segment are as follows:
•Dedicated - Transportation services with equipment devoted to customers under long-term contracts.
•Network- Transportation services of one-way shipments.
Cowan's dedicated operations are included in Dedicated beginning in the fourth quarter of 2024.
Year Ended December 31,
2025 2024
Dedicated
Revenues (excluding fuel surcharge) (1)
$ 1,738.1 $ 1,410.6
Average trucks (2) (3)
8,504 6,829
Revenue per truck per week (4)
$ 4,016 $ 4,041
Network
Revenues (excluding fuel surcharge) (1)
$ 731.1 $ 760.3
Average trucks (2) (3)
3,747 3,926
Revenue per truck per week (4)
$ 3,833 $ 3,788
Total Truckload
Revenues (excluding fuel surcharge) (5)
$ 2,470.4 $ 2,170.7
Average trucks (2) (3)
12,251 10,755
Revenue per truck per week (4)
$ 3,960 $ 3,948
Average company trucks (3)
10,908 9,244
Average owner-operator trucks(3)
1,343 1,511
Trailers (6)
51,733 54,459
Operating ratio (7)
95.6 % 95.9 %
(1)Revenues (excluding fuel surcharge), in millions, exclude revenue in transit.
(2)Includes company and owner-operator trucks.
(3)Calculated based on beginning and end of month counts and represents the average number of trucks available to haul freight over the specified timeframe.
(4)Calculated excluding fuel surcharge and revenue in transit, consistent with how revenue is reported internally for segment purposes, using weighted workdays.
(5)Revenues (excluding fuel surcharge), in millions, include revenue in transit at the operating segment level and, therefore does not sum with amounts presented above.
(6)Includes entire fleet of owned trailers, including trailers with leasing arrangements between Truckload and Logistics.
(7)Calculated as segment operating expenses divided by segment revenues (excluding fuel surcharge) including revenue in transit and related expenses at the operating segment level.
Truckload revenues (excluding fuel surcharge) increased $299.7 million, or 14%, for the year ended December 31, 2025 compared to 2024. The increase was driven by a 23% rise in Dedicated volume, primarily due to the Cowan acquisition, as well as higher revenue per truck per week in Network. These increases were partially offset by a 4% decline in Network volume.
Truckload income from operations increased $18.9 million, approximately 21%, in the year ended December 31, 2025 compared to 2024. The increase was driven by the revenue factors discussed above, lower Network purchased transportation, as a result of reduced owner-operator capacity, and higher gains on equipment sales. These improvements were partially offset by increased salaries and wages expense, largely due to additional headcount from the Cowan acquisition; higher depreciation and other equipment-related expenses resulting from increased equipment counts from the Cowan acquisition; and increased insurance-related expenses attributable to the Cowan acquisition and prior-year claims development.
Intermodal
The following table presents the KPIs for our Intermodal segment for the periods indicated.
Year Ended December 31,
2025 2024
Orders (1)
442,740 419,833
Containers 26,376 26,553
Trucks (2)
1,362 1,413
Revenue per order (3)
$ 2,430 $ 2,474
Operating ratio (4)
94.0 % 94.8 %
(1)Based on delivered rail orders.
(2)Includes company and owner-operator trucks at the end of the period.
(3)Calculated using rail revenues excluding fuel surcharge and revenue in transit, consistent with how revenue is reported internally for segment purposes.
(4)Calculated as segment operating expenses divided by segment revenues (excluding fuel surcharge) including revenue in transit and related expenses at the operating segment level.
Intermodal revenues (excluding fuel surcharge) increased $33.9 million, approximately 3%, in the year ended December 31, 2025 compared to 2024. The increase was driven by an increase in volume of 5%, partially offset by a 2% decrease in revenue per order resulting from mix.
Intermodal income from operations increased $10.2 million, approximately 19%, in the year ended December 31, 2025 compared to 2024. The improvement primarily reflects the revenue increases noted above and lower rail-related costs, partially offset by higher dray execution and maintenance costs.
Logistics
The following table presents the KPI for our Logistics segment for the periods indicated.
Cowan's logistics operations are included in Logistics beginning in December 2024.
Year Ended December 31,
2025 2024
Operating ratio (1)
98.1 % 97.4 %
(1)Calculated as segment operating expenses divided by segment revenues (excluding fuel surcharge) including revenue in transit and related expenses at the operating segment level.
Logistics revenues (excluding fuel surcharge) increased $51.7 million, approximately 4%, in the year ended December 31, 2025 compared to 2024, mainly due to the Cowan acquisition, partially offset by lower volume in our legacy brokerage business.
Logistics income from operations decreased $7.7 million, approximately 24%, in the year ended December 31, 2025 compared to 2024, largely attributable to lower volume in our brokerage business. This decline was partially offset by incremental revenue from the Cowan acquisition described above and an increase in net revenue per order.
Other
Other loss from operations increased $17.7 million in the year ended December 31, 2025 compared to 2024 due to an increase in corporate costs and insurance-related expense driven by prior-year claims development.
LIQUIDITY AND CAPITAL RESOURCES
Our primary uses of cash are working capital requirements, capital expenditures, dividend payments, share repurchases, and debt service requirements. Additionally, we may use cash for acquisitions and other investing and financing activities. Working capital is required principally to ensure we are able to run the business and have sufficient funds to satisfy maturing short-term debt and operational expenses. Our capital expenditures consist primarily of transportation equipment and information technology.
Historically, our primary source of liquidity has been cash flow from operations. In addition, we have a $250.0 million revolving credit facility maturing in November 2027 and a $200.0 million receivables purchase agreement maturing in May 2027, for which our combined available capacity as of December 31, 2025 was $346.7 million. Our revolving credit facility allows us to request an additional increase in total commitment by up to $150.0 million. We anticipate that cash generated from operations, together with amounts available under our credit and receivables purchase agreements, will be sufficient to meet our requirements for the foreseeable future. To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that we will obtain these funds through additional borrowings, equity offerings, or a combination of these potential sources of liquidity. Our ability to fund future operating expenses and capital expenditures, as well as our ability to meet future debt service obligations or refinance our indebtedness, will depend on our future operating performance, which will be affected by general economic, financial, and other factors beyond our control.
The following table presents our cash and cash equivalents, marketable securities, and outstanding debt and finance lease obligations as of the dates shown.
(in millions) December 31, 2025 December 31, 2024
Cash and cash equivalents $ 201.5 $ 117.6
Marketable securities 41.8 47.9
Total cash, cash equivalents, and marketable securities $ 243.3 $ 165.5
Debt:
Senior notes $ 50.0 $ 145.0
Receivables purchase agreement - 70.0
Delayed-draw term loan facility 347.5 300.0
Finance leases 5.0 8.4
Total debt and finance lease obligations $ 402.5 $ 523.4
Debt
On December 31, 2025, we were in compliance with all financial covenants under our credit agreements and the agreements governing our senior notes. See Note 7, Debt and Credit Facilities, for information about our financing arrangements.
Cash Flows
The following table summarizes the changes to our net cash flows provided by (used in) operating, investing, and financing activities for the periods indicated.
Year Ended December 31,
(in millions) 2025 2024
Net cash provided by operating activities $ 637.4 $ 686.1
Net cash used in investing activities (346.2) (791.5)
Net cash (used in) provided by financing activities (207.3) 120.6
Operating Activities
Net cash provided by operating activities decreased $48.7 million, approximately 7%, during 2025 compared to 2024. The decrease resulted from a decrease in cash provided by working capital, partially offset by an increase in net income adjusted for various noncash charges. Working capital changes were driven by changes to receivables related to trade and tax receivables; an increase in claims accruals related to specific claims; and changes to other liabilities related to the timing of year end wage accruals. These amounts were partially offset by an increase in cash provided by other assets related to timing of prepaid assets and a decrease in cash used by payables.
Investing Activities
Net cash used in investing activities decreased $445.3 million, approximately 56%, during 2025 compared to 2024. The decrease was primarily related to the absence of acquisition-related outflows in 2025 following the Cowan acquisition in 2024 and lower net capital expenditures in 2025. These factors were partially offset by reduced proceeds from the sale of off-lease inventory and higher purchases of lease equipment in 2025.
Net Capital Expenditures
The following table outlines our net capital expenditures for the periods indicated.
Year Ended December 31,
(in millions) 2025 2024
Purchases of transportation equipment $ 352.0 $ 414.0
Purchases of other property and equipment 32.8 65.1
Proceeds from sale of property and equipment (95.6) (98.8)
Net capital expenditures $ 289.2 $ 380.3
Net capital expenditures decreased $91.1 million in 2025 compared to 2024. The decrease was driven by a $62.0 million decrease in purchases of transportation equipment reflecting higher spend on growth and replacement equipment in 2024, along with $31.1 million of real estate purchases related to Cowan in 2024 (see Note 2 Acquisitions for more information on the real estate purchase). Proceeds from sale of property and equipment declined year over year primarily due to a decrease in the number of tractor sales.
We expect 2026 net capital expenditures to range from $400.0 - $450.0 million, including $78.2 million of firm purchase commitments disclosed in Note 13, Commitments and Contingencies.
Financing Activities
Net cash used in financing activities increased $327.9 million, approximately 272%, in 2025 compared to 2024. The increase was primarily due to a $215.0 million reduction in proceeds from long-term debt and revolving credit, which were used to partially fund the Cowan acquisition in 2024; a $106.9 million increase in payments on long-term debt and finance lease obligations; and a $20.0 million increase in payments on revolving credit. These factors were partially offset by a $14.9 million decrease in treasury share repurchases.
Off-Balance Sheet Arrangements
As of December 31, 2025, we had no off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our consolidated financial condition, results of operations, liquidity, capital expenditures, or capital resources.
Contractual Obligations
As of December 31, 2025, we had contractual obligations related to our long-term debt of $397.5 million and $71.9 million for principal borrowings and interest, respectively, which become due through 2029. See Note 7, Debt and Credit Facilities, for additional information regarding our debt obligations. We also have contractual obligations for finance and operating leases and purchase commitments related to agreements to purchase transportation equipment. See Note 8, Leases, and Note 13, Commitments and Contingencies, respectively, for additional information regarding our lease and purchase commitment obligations.
CRITICAL ACCOUNTING ESTIMATES
The preparation of our consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that impact the amounts reported in our consolidated financial statements and accompanying notes. Therefore, these estimates and assumptions affect reported amounts of assets, liabilities, revenue, expenses, and associated disclosures of contingent liabilities. Management evaluates these estimates on an ongoing basis, using historical experience, consultation with third parties, and other methods considered reasonable in the particular circumstances. Nevertheless, actual results may differ significantly from our estimates. Any effects on our business, financial position, or results of operations resulting from revisions to these estimates are recognized in the accounting period in which the facts that give rise to the revision become known.
The estimates discussed below include the financial statement elements that are either the most judgmental or involve the selection or application of alternative accounting policies and are material to our consolidated financial statements. Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board and with our independent registered public accounting firm.
Claims Accruals
Reserves are established based on estimated or expected losses for claims. The primary claims arising for the Company consist of accident-related claims for personal injury, collision, and comprehensive compensation, in addition to workers' compensation, property damage, cargo, and wage and benefit claims. We maintain self-insurance levels for these various areas of risk and have established reserves to cover self-insured liabilities. The amounts of self-insurance change from time to time based on measurement dates, policy expiration dates, policy exhaustion, and claim type. We also maintain insurance to cover liabilities in excess of the self-insurance amounts to limit our exposure to catastrophic claim costs or damages. We are substantially self-insured for loss of and damage to our owned and leased equipment. The current claims litigation and settlement environment within the industry has resulted in increases in our insurance premiums and claims expense, as well as excess insurance carriers decreasing coverage.
Our reserves represent accruals for the estimated self-insured and reinsured portions of pending claims, including adverse development of known claims, as well as incurred but not reported claims. Our estimates require judgments concerning the nature and severity of the claim, historical trends, advice from third-party administrators and insurers, consultation with actuarial experts, specific facts of individual cases, jurisdictions involved, estimates of future claims development, and legal and other costs to settle or defend the claims. The actual cost to settle our self-insured claim liabilities can differ from our reserve estimates because of a number of uncertainties, including the inherent difficulty in estimating the severity of a claim and the potential amount to defend and settle a claim. As of December 31, 2025 and 2024, we had estimated claims accruals of $320.8 million and $290.8 million, respectively, and reinsurance receivables of $65.2 million and $54.2 million, respectively.
We have significant exposure to fluctuations in the number and severity of claims. If there is an increase in the frequency and/or severity of claims, we are required to accrue or pay additional amounts if the claims prove to be more severe than originally assessed or exceed the limits of our insurance coverage, and our profitability would be adversely affected. In addition to estimates within our self-insured retention, we also must make judgments concerning our coverage limits. If any claim were to exceed our coverage limits, we would have to accrue for the excess amount. Our critical estimates include evaluating whether a claim may exceed such limits and, if so, by how much. If one or more claims were to exceed our effective coverage limits, our financial condition and results of operations could be materially and adversely affected.
Our claims accrual policy for all self-insured claims is to recognize a liability at the time of the incident based on our analysis of the nature and severity of the claim and analyses provided by third-party claims administrators or outside counsel, as well as legal, economic, and regulatory factors. Our insurance and claims personnel work directly with representatives from the insurance companies to provide updated estimates of the potential loss associated with each tendered claim. The ultimate cost of a claim is developed over time as additional information regarding the nature, timing, and extent of damages claimed becomes available.
Goodwill
To expand our business offerings, we have acquired other companies. In a business combination, the consideration is first assigned to identifiable assets and liabilities based on estimated fair values, with any excess recorded as goodwill. Determining fair value requires significant estimates and assumptions based on an evaluation of a number of factors, such as marketplace participants, history, future expansion and profitability expectations, amount and timing of future cash flows, and the discount rate applied to the cash flows. Goodwill is not amortized but is assessed for impairment at least annually and more frequently if a triggering event indicates that impairment may exist.
Our goodwill balances as of December 31, 2025 and 2024 were $337.4 million and $377.9 million, respectively. Goodwill is evaluated for impairment annually at the reporting unit level, or more frequently if events or circumstances indicate the carrying value is not recoverable. A reporting unit can be a segment or business within a segment, and reporting units can be aggregated to the extent they share similar economic characteristics. When reviewing goodwill for impairment, we consider the amount of excess fair value over the carrying value of each reporting unit, the period of time since a reporting unit's last quantitative test, the extent a reorganization or disposition changes the composition of one or more of our reporting units, and other factors to determine whether or not to first perform a qualitative test. When performing a qualitative test, we assess numerous factors to determine whether it is more likely than not that the fair values of our reporting units are less than their respective carrying values. Examples of qualitative factors that are assessed include our share price, financial performance, market and competitive factors in our industry, and other events specific to our reporting units. If we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we perform a quantitative impairment test. In the quantitative impairment evaluation, the carrying value of a reporting unit, including goodwill, is compared with its fair value. We base our fair value estimation on a valuation, which uses a combination of (1) an income approach based on the present value of estimated future cash flows and (2) market approaches based on EBITDA valuation multiples of comparable companies and transactions. If the carrying value of a reporting unit exceeds its fair value, an impairment loss is recorded equal to that excess. Significant judgment is necessary to evaluate the impact of operating and macroeconomic changes and to estimate future cash flows. Assumptions used in impairment evaluations, such as forecasted growth rates and our cost of capital, are based on the best available market information and are consistent with our internal forecasts and operating plans. These assumptions could be adversely impacted by certain risks discussed earlier in this document.
The Company completed its acquisition of Cowan on December 2, 2024. As a result, we recorded $4.9 million of goodwill, which was allocated to the Dedicated reporting unit.
We completed the required annual goodwill impairment assessment for our two reporting units with goodwill as of October 31, 2025 using quantitative assessments. The fair values of our Dedicated and Import/Export reporting units were substantially in excess of their respective carrying values.
There were no triggering events identified from the date of our assessment through December 31, 2025 that would require updates to our annual impairment test. If future operating performance of our Dedicated or Import/Export reporting units is below our expectations, or there are changes to forecasted growth rates or our cost of capital, a decline in the fair value of the reporting units could result, and we may be required to record a goodwill impairment charge. See Note 6, Goodwill and Other Intangible Assets, for more information.
Business Combinations
We record assets acquired and liabilities assumed in a business combination under the acquisition method of accounting where consideration is first assigned to identifiable assets and liabilities based on estimated fair values, with any excess recorded as goodwill. During the measurement period, which is up to one year from the acquisition date, we may adjust provisional amounts that were recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date.
Determining the fair value of assets acquired and liabilities assumed requires significant judgment, including the selection of valuation methodologies. For our recent acquisitions, fair value estimates of acquired property and equipment were based on independent appraisals that gave consideration to the highest and best use of the assets. The transportation equipment; land, buildings, and improvements; and other property and equipment appraisals used one, or a combination, of the market, income (direct capitalization), or sales comparison approaches. Significant estimates and assumptions, including recent sales prices of similar equipment, asset condition, and current and anticipated market trends, were used in determining the fair values of these assets. The assistance of an independent third-party valuation firm was used to determine the estimated fair values and useful lives of finite-lived intangible assets including customer relationships and trademarks. Valuation methods used were based on income-based approaches including the multi-period excess earnings method and relief from royalty method for customer relationships and trademarks, respectively. Non-compete agreements were recorded based on amounts paid at closing. Assumptions used in the intangible valuations include forecasted revenue growth rates, future cash flows, useful lives of intangible assets acquired, and our cost of capital.
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