Werner Enterprises, Inc.

Second-quarter revenues totaled $934 million, up 24% year over year. Adjusted operating income was $27.6 million, up 67%, and adjusted operating margin was 3.0%, up 80 basis points. Adjusted EPS was $0.22, up $0.14. Consolidated gains on sale of property and equipment were $1.5 million versus $5.9 million a year ago. Truckload Transportation Services revenue was $703 million, up 36%, and revenues net of fuel surcharges were $582 million, up 26%. TTS adjusted operating margin net of fuel was 5.5%, up 270 basis points. Logistics revenue was $212 million, down 4%, and logistics adjusted operating margin was negative 1.3%. Operating cash flow was $85 million, free cash flow was $94 million, total liquidity was $657 million, and net debt was $841 million. For 2026, Werner raised dedicated revenue per truck per week guidance to up 3% to 5% from flat to up 3%, lowered average truck fleet growth guidance to up 16% to 18% from up 23% to 28%, and increased net CapEx guidance to $215 million to $250 million from $185 million to $225 million. The company maintained its full-year tax rate guidance at 25.5% to 26.5% and expects net interest expense of $40 million to $45 million. It narrowed gains on sale of used equipment and revenue-generating assets to $10 million to $14 million from $8 million to $18 million.

Derek Leathers framed the quarter as evidence that Werner’s restructuring, technology investments, and portfolio changes are working. He emphasized that enforcement around non-domiciled CDLs, English language proficiency, cabotage, and related actions are removing capacity and favoring compliant carriers like Werner. His tone was confident and increasingly optimistic, saying the company is 'spring loaded' for the upcycle and expects a more pronounced step-up in results in the second half and into 2027.

Christopher Wikoff highlighted the financial improvement across the quarter, including $934 million of revenue, $27.6 million of adjusted operating income, and $0.22 of adjusted EPS. He noted that non-recurring items were mostly tied to M&A and restructuring, with 45% of pre-tax adjustments related to First Fleet and 43% to 1-way restructuring, and said no further 1-way restructuring expense is expected. On cash and capital allocation, he said operating cash flow was $85 million, free cash flow was $94 million, liquidity was $657 million, and net debt fell $86 million sequentially; he also said the company remains balanced on capital allocation while investing in the business, returning capital, and maintaining leverage. He tied the higher CapEx guide to fleet modernization, a pre-buy of certain 2020 model-year tractors ahead of 2027 emissions standards, and lower average fleet age.

Analysts pressed on why dedicated pricing guidance was only low-to-mid single-digit and whether driver constraints would delay growth into 2027. Management said the guidance referred to 1-way contract renewals, while dedicated guidance was actually raised to up 3% to 5%, and said hiring is improving but remains constrained by a tighter driver market. Questions also focused on the impact of the Montgomery verdict and the broader insurance and broker landscape; Derek said customers are increasingly focused on quality and compliance, which is helping Werner’s asset-based business and its logistics vetting standards. On supply, management said enforcement is still in the 'early innings' and described the environment as only about the 'third inning,' with more capacity likely to come off the road through the rest of the year and into early next year.