FORWARD AIR (FWRD)·Q4 2025 Earnings Summary
Forward Air Q4 2025: Omni Hits Record Quarter, But Stock Drops 9% on Revenue Miss
February 23, 2026 · by Fintool AI Agent
Forward Air Corporation (NASDAQ: FWRD) reported Q4 2025 results that painted a mixed picture: Omni Logistics delivered its best quarter since the January 2024 acquisition, but a modest revenue miss and continued headwinds in the freight market sent shares tumbling 9.1% on the news. The company continues its post-Omni transformation while navigating an uncertain macro environment marked by trade policy concerns and a prolonged freight recession.
Did Forward Air Beat Earnings?
The verdict: Mixed. Revenue missed while profitability metrics showed year-over-year improvement.
*Values retrieved from S&P Global
The headline numbers obscure divergent segment performance. While Omni Logistics delivered a standout quarter and Expedited Freight showed meaningful margin improvement, the Intermodal segment was hit hard by trade-related softness.
Ask Fintool AI AgentHow Did the Stock React?
FWRD shares fell 9.1% on earnings day, closing at $25.28 — erasing gains from earlier in the month.
The selloff reflects investor concerns about:
- Continued GAAP losses despite operational improvements
- Intermodal segment weakness with no clear catalyst for recovery
- High leverage (5.5x net debt/EBITDA) in an uncertain freight environment
- Tariff uncertainty clouding forward visibility
The stock has been volatile since the Omni acquisition in January 2024, trading between a 52-week low of $9.79 and high of $32.47.
What Changed From Last Quarter?
Omni Logistics broke out. The segment hit new highs across revenue ($360M), Reported EBITDA ($36M), and margin (10.0%) — all best-since-acquisition figures.
Expedited Freight margins expanded. The legacy Forward Air LTL business posted a 350 basis point improvement in EBITDA margin year-over-year (10.1% vs 6.6%), driven by pricing discipline and cost management.
Intermodal deteriorated. Revenue fell 15.5% YoY to $51M, with EBITDA margin compressing from 17.5% to 14.2%. Management cited "trade-related softness" and seasonality.
Cash flow improved dramatically. FY2025 operating cash flow of $44M compared to cash usage of $69M in FY2024 — a $113M swing.
Segment Performance Deep Dive
Expedited Freight: Margin Story Continues
The volume declines (-9% YoY shipments) reflect the broader freight recession, but pricing discipline is paying off. Revenue per shipment increased despite soft demand, and the claims ratio remains industry-leading at 0.11%.
Omni Logistics: Star Performer
CEO Shawn Stewart highlighted Omni's "best results since we acquired the company," pointing to strong demand for diversified air, ocean, and ground services. The segment now represents ~54% of total revenue and is the growth engine post-acquisition.
Intermodal: Under Pressure
The smallest segment by revenue, Intermodal has been hit by port activity softness tied to trade uncertainty. Management expressed confidence in the team's ability to "deliver solid results as we manage through the current freight market."
Ask Fintool AI AgentLiquidity, Leverage, and Cash Flow
Forward Air maintains a solid but elevated leverage profile:
The company has no debt maturities until December 2030, providing runway to execute the Omni integration. The Term Loan B ($1,045M) matures in December 2030 and Senior Secured Notes ($725M) mature in October 2031.
A notable item: $19.8M charge for abandoned software project costs related to technology consolidation efforts.
What Did Management Say?
On Q4 performance:
"For the full year 2025, we reported consolidated EBITDA of $307 million, compared to $311 million in 2024. As we mentioned last year, we expected the quality of our earnings to continue to improve as historical pro forma and synergy savings roll off. That is exactly what has happened. Adjusted EBITDA in 2025 improved $40 million year-over-year to $293 million, compared to $253 million in 2024." — Shawn Stewart, CEO
On Omni's breakout:
"The Omni segment achieved its highest revenue, highest Reported EBITDA and highest Reported EBITDA margin, excluding the impact of goodwill adjustments, since we acquired the company in January 2024." — Shawn Stewart, CEO
On the transformation:
"During the year we diligently focused on what we could control including aligning our cost structure to match demand and executing our transformation strategy. We also unified our U.S. domestic ground operations and unveiled our new Latin American regional structure." — Shawn Stewart, CEO
On the cash flow inflection point:
"What's great about 2025 is we reached that inflection point. We spent about $166 million in interest, another $25 million in financing leases, and another $27 million in CapEx. Once we reach that inflection point, every incremental dollar over that amount actually starts to fall straight to the bottom line in terms of cash. We generated $1 million increase in cash from 2024 to 2025. It's the fact that we dug out one hell of a hole in 2024 to actually accomplish that in 2025." — Jamie Pierson, CFO
Q&A Highlights
On operating leverage in a recovery (Bruce Chan, Stifel):
"We've created an incredibly strong model with operating leverage, whereby, all else being equal, assuming price is the same, if you drop in one incremental shipment into the network, it is much more profitable than the previous shipment... You add 1 more shipment on that trailer that's already dispatched, you've already incurred the cost for it, it's going to be much more accretive than the prior shipment." — Jamie Pierson, CFO
On strategic alternatives timeline (Scott Group, Wolfe Research):
"I feel confident that we are coming to a conclusion here, and more to come as that rounds itself out." — Shawn Stewart, CEO
On early signs of market recovery:
"Since the end of the year, the recent spike in TL spot rates and the same tender rejections do give me hope that we're reaching an inflection point. Before declaring victory, we're going to need to see sustained PMI above 50 and continued increase in spot rates and rejections." — Jamie Pierson, CFO
On Omni Logistics growth drivers (Stephanie Moore, Jefferies):
"We've got our swagger back. We've got a detailed focus. We know what we want to do and how we perform well, and we know what we're not, and we're not going to offer those offerings. We're staying really laser-focused on selling solutions that are in our wheelhouse." — Shawn Stewart, CEO
On data center exposure (Bruce Chan, Stifel):
"We're scaling with it... with the high value, high risk area of this business, going from our world-class warehouses on the contract logistics side into our trucks, into the clean rooms of the data centers, we're very good at this service, and we continue to gain momentum there." — Shawn Stewart, CEO
2026 Priorities and Leadership Additions
New leadership hires announced:
- Fabio Mendonça — President of Latin America (30+ years experience)
- Joanna Zhu — President of Asia Pacific (34 years experience with largest global logistics companies)
- Lance Sons — Chief Information Officer (30 years experience at tech-forward supply chain companies)
Technology transformation:
- One ERP initiative — Consolidating multiple financial systems into single integrated platform. First phase completed in early February, final phase expected by year-end
- Global HRIS consolidation — Moving to one worldwide HR system across all countries
Key Risks and Concerns
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Tariff Uncertainty — Management flagged "the imposition of additional tariffs, potential escalation from trading partners, the uncertainty surrounding trade policy" as key risk factors.
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Freight Market Weakness — The broader freight recession continues to pressure volumes across segments, particularly Intermodal.
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High Leverage — At 5.5x net leverage, the company has limited flexibility. The required covenant ratio is 6.50x, leaving ~1.0x cushion.
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Integration Execution — The Omni acquisition is still being integrated. Transaction and integration costs were $31M in FY2025.
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Strategic Alternatives Nearing Conclusion — The company's strategic review process appears to be nearing completion. CEO Stewart stated the review has been "extremely comprehensive" given the "incredibly difficult logistics environment and broader economic backdrop."
Historical Context: 8-Quarter Trend
Revenue has stabilized in the $620-630M range since Q1 2025, while EBITDA margins have expanded from 11.4% to 12.2% — reflecting cost discipline and integration progress.
Forward Catalysts to Watch
- Q1 2026 Earnings — Will Omni momentum continue? Can Intermodal stabilize?
- Tariff Policy Clarity — Trade policy resolution could lift Intermodal volumes
- Freight Market Recovery — Cyclical upturn would drive volume growth across segments
- Strategic Alternatives Update — Potential for asset sales, spin-offs, or M&A activity
- Deleveraging Progress — Management's path to reducing the 5.5x leverage ratio
Ask Fintool AI AgentThe Bottom Line
Forward Air's Q4 2025 results showcase a company in transition. Omni Logistics is firing on all cylinders, delivering record results that validate the January 2024 acquisition thesis. Expedited Freight margins are expanding despite volume pressures. But Intermodal remains a drag, and the stock's 9% drop signals that investors want to see clearer evidence that the transformation is translating to sustained growth and deleveraging.
At 5.5x leverage with $1.7B in debt, Forward Air is a higher-risk play on freight market recovery. The no-maturities-until-2030 runway provides time, but execution on cost savings, Omni integration, and eventually volume recovery will determine whether this transformation story pays off for shareholders.
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