Reed Saiya

Reed Saiya sought clarification on the Managed Freight revenue outlook for 2026, specifically whether the 'flat to up' projection was on a sequential or year-over-year basis. He also asked about the expected sequential margin progression for the Dedicated and Expedited segments from Q4 2025 to Q1 2026, the company's overall margin goals for 2026, and the long-term target margin profiles for both businesses if current initiatives succeed.

Answer

CEO David R. Parker clarified that the Managed Freight revenue projection was on a sequential basis, expecting Q1 2026 revenue to be slightly below Q4 2025, followed by incremental top-line revenue improvement. EVP Joey Hogan expected sequential improvement for Expedited from Q4 2025 to Q1 2026, potentially 150-200 basis points, assuming no government shutdown or severe weather. He reiterated expected sequential improvement for Dedicated throughout 2026. Long-term, Joey Hogan targeted Expedited margins in the 80s (operating ratio) and Dedicated in the high 80s to 90.

Reed Saiya sought clarification on the Managed Freight revenue outlook for 2026, asking if the 'flat to up' projection was on a sequential or year-over-year basis. He also inquired about the expected sequential margin progression for the Expedited and Dedicated segments from Q4 to Q1, and the overall margin goals for 2026. Finally, Saiya asked for the long-term target margin profiles for both Expedited and Dedicated segments, assuming current initiatives continue as expected.

Answer

CEO David R. Parker clarified that Managed Freight revenue is expected to be flat to up on a sequential basis, with Q1 2026 likely below Q4 2025, followed by incremental improvement. EVP Joey Hogan anticipated sequential improvement for Expedited from Q4 2025 to Q1 2026, potentially 150-200 basis points, contingent on no government shutdown or severe weather. For long-term margin targets, Joey Hogan stated a goal for Expedited to be in the 80s (operating ratio) and Dedicated in the high 80s to 90.