Executive Summary

Q2 2025 came in below Street: revenue $0.210B vs $0.230B consensus and EPS -$0.14 vs -$0.073 consensus; EBITDA also missed, reflecting continued weak freight demand and pricing headwinds in full truckload * *.
Sequential improvement in brand operating ratios at Heartland Express and Millis Transfer (~400 bps), but Smith Transport and CFI remained unprofitable; CFI’s TMS conversion and telematics rollout weighed on results near term .
Balance sheet strengthened: debt and finance lease obligations reduced to $194.0M, cash $22.9M; positive operating cash flow persisted despite losses .
Management expects freight demand and pricing to show material improvement later in 2025 with operating efficiencies from unified systems in 2026, setting potential catalysts around integration milestones and market inflection .

What Went Well and What Went Wrong

What Went Well

Heartland Express and Millis Transfer operated profitably and improved operating ratios by ~400 bps sequentially in Q2, signaling self-help progress despite macro pressures .
Balance sheet discipline: acquisition-related debt down from $494M in 2022 to $194M in Q2 2025; no borrowings under the unsecured revolver, $88.3M capacity available .
Persistent operating cash generation: $46.8M YTD cash from operations (10.9% of revenue), enabling $5.6M debt repayment, $5.8M net fleet investment, and $8.9M buybacks in Q2 .
Quote: “Despite the operating loss during the quarter, we continue to have positive cash flows from operations.” — Mike Gerdin, CEO .

What Went Wrong

Topline and earnings misses: operating revenue $210.4M vs $274.8M YoY, EPS -$0.14 vs -$0.04 YoY; operating ratio deteriorated to 105.9% (adjusted 106.0%) vs 99.9% YoY .
Smith Transport and CFI remained unprofitable; CFI’s major TMS conversion produced a negative sequential impact, with telematics transition ~75% complete as of Q2 .
Industry backdrop: management cites “unsustainable pricing” and rising costs amid capacity exceeding weak demand—headwinds likely to persist until later in 2025 .

Financial Results

Consolidated Metrics: Sequential and Year-over-Year

Metric	Q4 2024	Q1 2025	Q2 2025
Operating Revenue ($USD Billions)	$0.243	$0.219	$0.210
Fuel Surcharge Revenue ($USD Millions)	$28.0	$26.3	$24.5
Net (Loss) Income ($USD Millions)	$(1.9)	$(13.9)	$(10.9)
Basic EPS ($USD)	$(0.02)	$(0.18)	$(0.14)
Operating Ratio (%)	99.6%	106.8%	105.9%
Adjusted Operating Ratio (%)	98.9%	107.1%	106.0%
Net Loss Margin (%)	0.8%	6.3%	5.2%

Year-over-Year: Q2 2025 vs Q2 2024

Metric	Q2 2024	Q2 2025
Operating Revenue ($USD Billions)	$0.275	$0.210
Fuel Surcharge Revenue ($USD Millions)	$36.8	$24.5
Net (Loss) Income ($USD Millions)	$(3.5)	$(10.9)
Basic EPS ($USD)	$(0.04)	$(0.14)
Operating Ratio (%)	99.9%	105.9%
Adjusted Operating Ratio (%)	99.4%	106.0%
Net Loss Margin (%)	1.3%	5.2%

Balance Sheet and Liquidity (Quarter-End)

Metric	Q4 2024	Q1 2025	Q2 2025
Cash and Cash Equivalents ($USD Millions)	$12.812	$23.873	$22.879
Total Assets ($USD Billions)	$1.334	$1.345	$1.299
Stockholders’ Equity ($USD Millions)	$822.599	$807.725	$786.737
Debt & Finance Lease Obligations ($USD Millions)	$200.7	$199.6	$194.0
Revolver Availability ($USD Millions)	$88.3	$88.3	$88.3

KPIs (Additional)

KPI	Q4 2024	Q1 2025	Q2 2025
Cash from Operations (% of Revenue)	15.6% (Q4 only)	11.8% (Q1 only)	10.9% (6M YTD)
Share Repurchases (Shares, $USD Millions)	0.6M; $7.3 (FY 2024)	None	1.0M; $8.9
Average Tractor Fleet Age (Years)	2.5	2.6	2.6
Average Trailer Fleet Age (Years)	7.4	7.4	7.5

Segment/Brand Operating Status (Qualitative)

Brand	Q1 2025	Q2 2025
Heartland Express	Profitable, below historical targets	Profitable; OR improved ~400 bps sequentially
Millis Transfer	Unprofitable	Profitable; OR improved ~400 bps sequentially
Smith Transport	Unprofitable	Improved OR but remained unprofitable
CFI	Unprofitable; under-utilized assets	Unprofitable; negative sequential impact from TMS conversion; telematics ~75% complete

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Capex ($USD Millions)	CY 2025	$40–$50	$35–$45	Lowered
Gains on Disposal ($USD Millions)	CY 2025	$10–$15	$12–$17	Raised
Dividend per Share ($USD)	Q2 2025	$0.02 (regular dividend cadence)	$0.02 declared; paid July 3	Maintained
CFI Telematics Transition (%)	Q3 2025 target	N/A	~75% complete in Q2; expected completion in Q3	New operational milestone
Unified TMS across brands (timeline)	By 12/31/2025	N/A	All brands expected on common TMS by YE 2025; efficiencies in 2026	New operational milestone

Earnings Call Themes & Trends

Note: We did not find a Q2 2025 earnings call transcript for HTLD in the period searched; themes reflect management’s press releases.

Topic	Previous Mentions (Q4 2024)	Previous Mentions (Q1 2025)	Current Period (Q2 2025)	Trend
Freight demand & pricing	Sequential improvement into Q4; still weak; OR progress across brands	Adverse winter weather; tariff uncertainties; ongoing weak demand/pricing	Expect material improvement later in 2025; unsustainable pricing and rising costs still headwinds	Cautious improving outlook
Cost controls & operating ratio	Consolidated OR improved vs Q1 2024; focus on efficiencies	Strategic shrinking of fleet; evaluating cost measures	~400 bps OR improvement at Heartland & Millis; ongoing cost reduction efforts	Self-help progress
Systems/technology (TMS, telematics)	Integration progress across acquisitions; efficiencies targeted	Transportation system changes planned per brand	CFI TMS conversion completed; telematics ~75% complete; all brands on common TMS by YE 2025	Execution advancing
Debt reduction & liquidity	$100.3M debt repaid in 2024; revolver undrawn	$199.6M debt at Q1; revolver undrawn	$194.0M debt at Q2; revolver undrawn; $88.3M availability	Continued deleveraging
Macro/tariffs/regulatory	Weak environment; supply-demand modestly improved	Tariff uncertainties in March cited	Capacity exceeds demand; pricing unsustainable; expect improvement later in 2025	Persistent pressure

Management Commentary

“Our consolidated operating results… reflect sequential improvement during a prolonged and challenged industry-wide operating environment where current capacity outpaces weak freight demand… Despite the operating loss during the quarter, we continue to have positive cash flows from operations.” — Mike Gerdin, CEO .
“Both the Heartland Express fleet and the Millis Transfer fleet operated profitably and each improved their operating ratio by approximately 400 bps… Smith Transport… did not operate profitably… CFI… did not operate profitably and experienced a negative sequential impact…” .
“We expect to have all four operating brands on a common transportation management system by December 31, 2025, which we expect will drive multiple operating efficiencies in 2026.” .
“We have continued to strategically reduce underperforming lanes of freight and reduce our overall fleet size to better align with current freight demand…” .

Q&A Highlights

We did not locate a Q2 2025 earnings call transcript; therefore, Q&A highlights and any clarifications typically provided on the call are unavailable based on our document search. We will update this section if a transcript is published.

Estimates Context

Revenue: Actual $0.210B vs consensus $0.230B*; miss of approximately $19.2M (~8.4% below consensus). Actual from 8‑K; consensus from S&P Global*. *
EPS: Actual -$0.14 vs consensus -$0.073*; miss of -$0.067 per share. Actual from 8‑K; consensus from S&P Global*. *
EBITDA: Actual $26.3M* vs consensus $36.9M*; miss of ~$10.6M. EBITDA values per S&P Global*.

Values retrieved from S&P Global.*

Estimate Comparison Table (Q2 2025)

Metric	Consensus*	Actual	Surprise
Revenue ($USD Millions)	229.6*	210.4	-19.2 (−8.4%)
EPS ($USD)	-0.073*	-0.14	-0.067
EBITDA ($USD Millions)	36.9*	26.3*	-10.6

Key Takeaways for Investors

The quarter was a clear miss vs Street on revenue and EPS; continued macro pressure and CFI transition issues drove weaker profitability despite some sequential OR gains at core brands—near-term estimate cuts likely * *.
Debt reduction trajectory remains intact with $194.0M outstanding and undrawn revolver; liquidity and cash generation provide flexibility to continue integration and fleet investments .
Operational milestones (CFI telematics completion in Q3; unified TMS by YE 2025) are key catalysts for 2026 efficiency gains; monitor execution timelines closely .
Capex guidance reduced ($35–$45M) while expected gains on sales raised ($12–$17M) for 2025—signals tighter capital discipline and potential non-operating offsets .
Shareholder returns continue via dividend ($0.02) and opportunistic buybacks (1.0M shares in Q2); expect repurchases to be balanced against deleveraging and integration priorities .
Watch for freight demand/pricing inflection later in 2025 per management; if realized, combined with self-help, this could drive margin normalization from current triple-digit ORs .
Trading lens: near term skewed to caution until evidence of demand/pricing improvement and CFI’s stabilization; catalysts include Q3 telematics completion, any tariff clarity, and contract repricing wins .

HEARTLAND EXPRESS INC (HTLD)·Q2 2025 Earnings Summary