HEARTLAND EXPRESS INC (HTLD)·Q3 2025 Earnings Summary

Executive Summary

• Q3 2025 revenue was $196.5M and basic EPS was -$0.11; revenue missed Wall Street consensus of $209.7M* while EPS modestly beat the -$0.12* consensus. Sequential operating ratio improved to 103.7% from 105.9% in Q2 2025, and adjusted OR improved to 103.5% from 106.0% .
• Management completed transportation management system (TMS) consolidation across all four brands and finished CFI’s full fleet telematics transition; Heartland and Millis were profitable (low-90s OR), Smith returned to profitability, while CFI remained loss-making .
• FY2025 guidance shifted: net capex lowered to $27–$30M (from $35–$45M in Q2 and $40–$50M in Q1) and expected gains on equipment disposal raised to $21–$24M (from $12–$17M in Q2 and $10–$15M in Q1) .
• Liquidity and deleveraging continued: cash rose to $32.7M, debt and finance lease obligations fell to $185.4M, and the company stayed covenant compliant; a $0.02 quarterly dividend was paid on October 3, 2025 .

What Went Well and What Went Wrong

What Went Well

• Sequential operating ratio improved each month in Q3, with consolidated OR moving to 103.7% from 105.9% in Q2; adjusted OR to 103.5% from 106.0% .
• TMS standardization completed across Heartland, Millis, Smith, and CFI; management expects better driver utilization, collaboration, and fewer unproductive miles. “We now have all four operating brands on a common transportation management system…which will drive better driver utilization…reduce unproductive miles to improve overall operating efficiency” .
• Brand-level performance improved: Heartland and Millis profitable (low-90s OR), Smith returned to profitability, and CFI OR improved sequentially (though still loss-making) .

What Went Wrong

• Revenue fell 7% sequentially and 24% YoY, with fuel surcharge revenue down YoY; consolidated net loss remained negative (-$8.3M) and net loss margin was 4.2% .
• Macro remained a headwind: “current capacity continues to outpace weak freight demand and current freight rates have not kept pace with rising operating costs” and management does not expect “material market improvements until sometime in 2026” .
• CFI remained unprofitable despite system conversions; Q2 commentary also flagged unsustainable pricing and rising costs industry-wide .

Financial Results

Consolidated Results vs Prior Periods

Q3 2025 Actuals vs Consensus

Values retrieved from S&P Global*

Segment/Brand Profitability Status

Key KPIs

Non-GAAP notes: Adjusted OR excludes fuel surcharge and non-cash amortization of intangibles; see reconciliation and definitions in the press releases .

Guidance Changes

Earnings Call Themes & Trends

Note: No Q3 2025 earnings call transcript was available in our document set; themes derive from management press releases.

Management Commentary

• “We continue to recognize the prolonged and challenged industry-wide operating environment where current capacity continues to outpace weak freight demand and current freight rates have not kept pace with rising operating costs.”
• “We now have all four operating brands on a common transportation management system…to improve our overall operating efficiency…to combat continual market weakness.”
• “During the third quarter of 2025, the Heartland Express fleet and the Millis Transfer fleet continued to operate profitably with operating ratios in the low 90’s. The Smith Transport fleet returned to profitability…The CFI fleet also improved their operating ratio…[but] did not operate profitably.”
• “While we have begun to see some encouraging signs related to market capacity, freight demand still lags…Therefore, we do not currently expect material market improvements until sometime in 2026.”

Q&A Highlights

• No Q3 2025 earnings call transcript was available in our document set; Q&A highlights are therefore unavailable. Management clarifications and updates are drawn from the press releases, including system conversions, brand-level profitability, and macro outlook .

Estimates Context

• Q3 2025 revenue of $196.5M missed consensus of $209.7M*; EPS of -$0.11 was modestly better than consensus of -$0.12*. Counts: 3 revenue estimates and 5 EPS estimates*.
• Given the revenue miss and continued macro caution (“no material market improvements until sometime in 2026”), estimate revisions may skew down for revenue and up slightly for near-term EPS given sequential OR improvement .
  Values retrieved from S&P Global*

Key Takeaways for Investors

• Sequential margin improvement: OR improved to 103.7% (adjusted 103.5%) with month-over-month progress in Q3 .
• Systems execution complete: All brands now on common TMS; CFI telematics finished, setting up utilization and efficiency gains in 2026 .
• Mixed brand performance: Heartland and Millis profitable (low-90s OR), Smith back to profitability, CFI still loss-making but improving OR .
• Balance sheet resilience: Cash increased to $32.7M; debt down to $185.4M; covenant compliance maintained; dividend sustained at $0.02 .
• FY2025 guidance reshaped: Capex lowered to $27–$30M; expected gains on disposals raised to $21–$24M—reflecting tighter investment and asset sales opportunities .
• Near-term narrative drivers: revenue miss vs consensus* and management’s cautious 2026 recovery stance, partially offset by operational improvements and system consolidation .
• Watch for brand-level lift: Evidence of sustained profitability at Smith and improving CFI OR will be key for consolidated earnings recovery in 2026 .