FWRD 10-K & 10-Q changes, risk factors and insider trading
Forward Air Corp. · Nasdaq · Arrangement Of Transportation Of Freight & Cargo · CIK 912728 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We experience customer concentration which could adversely impact our financial condition and results of operations.”
New heading “The ineffectiveness of our fuel surcharge program could have a material adverse effect on our results of operations and profitability.”
New heading “We may not achieve the anticipated long-term benefits of the Omni Acquisition or our ongoing business transformation, and related challenges, costs or inefficiencies could outweigh anticipated long-term benefits.”
New heading “Concentration of ownership may limit your ability to influence corporate matters.”
New heading “If we identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price.”
New heading “Delays, costs, and disruptions that result from upgrading and maintaining the security of our information and technology networks and systems could materially and adversely affect us.”
New heading “Difficulty in forecasting timing or volumes of customer shipments could adversely impact our margins and operating results.”
Removed heading “Volatility in fuel prices, shortages of fuel or the ineffectiveness of our fuel surcharge program could have a material adverse effect on our results of operations and profitability.”
Removed heading “The Omni Acquisition may not achieve its intended benefits, and certain difficulties, costs or expenses may outweigh such intended benefits.”
Removed heading “We will incur significant transaction, merger-related and integration costs in connection with the Omni Acquisition.”
Removed heading “Higher prices by Leased Capacity Providers and other third-party transportation capacity providers could adversely impact our margins and operating results.”
Removed heading “Difficulty in forecasting timing or volumes of customer shipments could adversely impact our margins and operating results and lead to difficulties in predicting liquidity.”
Removed heading “Risks Relating to Omni Acquisition”
Removed heading “Prior to the Omni Acquisition, Omni was privately-held, and the transition to being a part of a public company, along with our combined ability to manage our expanded business, may require significant resources and management attention.”
Removed heading “We identified a material weakness in our internal control over financial reporting. If we are unable to remediate this material weakness, or identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price.”
Removed heading “Omni Holders are a significant holder of our common stock following completion of the Omni Acquisition.”
Largest changes
see in full comparisonFor example, in December 2020, we detected aA ransomware incident(theor“RansomwaresimilarIncident”)breach targeting impacting our operational and information technologysystems,systemswhichmaycausedcause service delays for our customers. Ifanothera cybersecurity event occurs,such as the Ransomware Incident,it could harm our business and reputation and could result in a loss of customers. Likewise, data privacy breaches by employees and others who access our systems may pose a risk that sensitive customer or vendor data may be exposed to unauthorized persons or to the public, adversely impacting our customer service, employee relationships and our reputation.Furthermore,Additionally, the rapid ongoing evolution and increased adoption of emerging technologies such as artificial intelligence and machine learning may make it more difficult to anticipate and implement protective measures to recognize, detect, and prevent the occurrence of anyfailureoftothesecomply with data privacy, security or other laws and regulations could result in claims, legal or regulatory proceedings, inquires or investigations.events.
“We identified a material weakness in our internal control over financial reporting. If we are unable to remediate this material weakness, or identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price.”see in full comparison
“The DOT and various state and federal agencies have been granted broad regulatory powers over our business in the United States, and we are licensed by the DOT and U.S. Customs. …”see in full comparison
“The DOT and various state and federal agencies have been granted broad regulatory powers over our business in the United States, and we are licensed by the DOT and U.S. Customs. Additionally, our Canada business activities are subject to the similar laws and regulations of Canada and its provinces, including the effects of the United States-Mexico-Canada Agreement, a trade agreement between the United States, Mexico and Canada. …”see in full comparison
“If we identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price.”see in full comparison
“While we are committed to designing and implementing new controls and measures to remediate this material weakness, we cannot assure you that the measures will be sufficient to remediate the material weakness or avoid the identification of additional material weaknesses in the future. …”see in full comparison
Full comparison: every changed paragraph (123)
We are sensitive to changeseconomic conditions, in overallparticular, economic conditionsthose that impact customer shipping volumes, industry freight demand and industry truck capacity. The transportation and supply chain industries have historically have experienced cyclical fluctuations in financial results due to economic recession, downturns in business cycles of customers, interest and currency rate fluctuations, inflation, supply chain disruptions, labor shortages and other economic factors beyond our control. Changes in U.S. or international trade policy could lead to “trade wars” impactingimpact the volume of economic activity domestically orand internationally, and as a result, trucking freight volumes may be materially reduced. Such a reductionreductions may materially and adversely affect our business. The U.S. has recently enacted and proposed to enact significant new tariffs. Additionally, President Trump has directed various federal agencies to further evaluate key aspects of U.S. trade policy and there has been ongoing discussion and commentary regarding potential significant changes to U.S. trade policies, treaties and tariffs. There continues to exist significant uncertainty about the future relationship between the U.S. and other countries with respect to such trade policies, treaties and tariffs. These developments, or the perception that any of them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the U.S.
The imposition of tariffs and other trade barriers by the U.S. government, including widespread baseline and country-specific tariffs on imported goods from countries such as China and Canada, has heightened global trade tensions, resulting in China, among other countries, imposing reciprocal tariffs in response. Significant uncertainty remains regarding U.S. trade policies, treaties, and tariff enforcement. These developments and the evolving circumstances surrounding international trade negotiations may materially impact global economic conditions, disrupt the stability of international financial markets, and reduce global trade activity with U.S. trading partners––particularly with China. If the impacts from the current tariff landscape on the Company’s business are more severe than expected as a result of shipments originating from tariff-impacted countries or the geopolitical or trade relationships between the U.S. and other countries, particularly China, deteriorate further, such impact could have a material adverse effect on the Company’s financial position, results of operations and/or cash flows.
DeteriorationAdditionally, deterioration in the economic environment or the occurrence of a large-scale economic event subjects our business to various risks, including the following that may have a material and adverse impact on our operating results and cause us not to maintain previously achieved or projected levels of profitability or achieve growth:
•A reduction in overall freight volumes reduces our revenues and opportunities for growth. In addition, a decline in the volume of freight shipped due to a downturn in customers’ business cycles or other factors (including our ability to assess dimensional and weight-based charges) generally results in decreases in freight pricing and decreases in revenue derived from various surcharges and accessorial charges. In our LTL business, these decreases typically reduce the average revenue per pound of freight, as carriers use price concessionconcessions to compete for loads to maintain truck productivity.
•Our base transportation rates are determined based on numerous factors such as length of haul, weight per shipment and freight class. During economic downturns and periods of low freight volume, we may also have to lower our base transportation rates based on competitive pricing pressures and other market factors.
•A significant number of our transportation providers may go out of businessbusiness, and we may be unable to secure sufficient equipment or other transportation services to meet our commitments to our customers.
Most of our operating expenses are sensitive to increases in inflation, including equipment prices, real property rental costs, fuel costs, insurance costs, employee wages and purchased transportation. While we have begun to see stabilization in inflation rates during the past several years, we have experienced significantly increased economic and demand uncertainty, which led to inflationary pressure in the U.S. and elsewhere, and to disruption and volatility in the demand for our services, and our suppliers’ ability to fill orders and global capital markets.
Most of our operating expenses are sensitive to increases in inflation, including equipment prices, real property rental costs, fuel costs, insurance costs, employee wages and purchased transportation. Inflation may generally increase our costs for materials, supplies andsupplies, services and capital. With increasing costs, we may have to increase our prices to maintain the same level of profitability. If we are unable to increase our prices sufficiently to offset increasing expenses, then inflation could have a material adverse effect on our financial condition, results of operations, liquidity and cash flows.
Inflation may generally increase our costs for materials, supplies, services and capital. With increasing costs, we may have to increase our prices to maintain the same level of profitability. If we are unable to increase our prices sufficiently to offset increasing expenses, then inflation could have a material adverse effect on our financial condition, results of operations, liquidity and cash flows.
Volatility in fuel prices, shortages of fuel or the ineffectiveness of our fuel surcharge program could have a material adverse effect on our results of operations and profitability.
We are subject to risks associated with the availability and price of fuel. Fuel prices have fluctuated dramatically over recent years. Future fluctuations in the availability and price of fuel could adversely affect our results of operations. Fuel availability and prices can be impacted by factors beyond our control, such as natural or man-made disasters, adverse weather conditions, political events, economic sanctions imposed against oil-producing countries or specific industry participants, disruption or failure of technology or information systems, price and supply decisions by oil producing countries and cartels, terrorist activities, armed conflict, tariffs, sanctions, other changes to trade agreements and world supply and demand imbalance. Over time we have been able to mitigate the impact of the fluctuations through fuel surcharge programs. Our fuel surcharge rates are set weekly based on the national average for fuel prices as published by the U.S. Department of Energy and our fuel surcharge table. Our fuel surcharge revenue is the result of our fuel surcharge rates and the tonnage transiting our networks. The impact of fuel on our results of operations depends on the relationship between the applicable surcharge, the fuel efficiency of our Company drivers, and load factor achieved by our operations. Fluctuations in fuel prices in either direction could have a positive or negative impact on our margins, particularly in our LTL business where the weight of a shipment subject to the fuel surcharge on a given trailer can vary materially. There can be no assurance that our fuel surcharge revenue programs will be effective in mitigating the full impact of future increases in fuel prices. Conversely, decreases in fuel prices reduce the amount of revenue derived from our fuel surcharge programs and accordingly, could reduce our consolidated revenues and may reduce margins for certain businesses. In addition to changing fuel prices, fluctuations in volumes and related load factors may subject us to volatility in our fuel surcharge revenue. Fuel shortages, changes in fuel prices and the potential volatility in fuel surcharge revenue may adversely impact our results of operations and overall profitability.
The Omni Acquisition may not achieve its intended benefits, and certain difficulties, costs or expenses may outweigh such intended benefits.
We may be unable to realize all of the anticipated benefits of the Omni Acquisition. Our success will depend, in part, on our ability to realize the anticipated benefits and synergies from reorganizing our corporate structure and combining the businesses of the Company and Omni following the Omni Acquisition, including cost and revenue synergies. The anticipated benefits and synergies of our combination with Omni may not be realized fully or at all, may take longer to realize than expected or could have other adverse effects that we do not currently foresee. We believe these risks are further heightened given the dispute with Omni, which was resolved prior to today, but which may make it more challenging to achieve the previously anticipated benefits and synergies.
Some of the assumptions that we have made, such as the tax outcomes of the contemplated pre-closing reorganization and the achievement of operating synergies, may not be realized. It is possible that the integration process could result in the loss of key Company or Omni employees, the loss of customers, the disruption of our ongoing businesses, inconsistencies in standards, controls, procedures and policies, unexpected integration issues, higher than expected integration costs and an overall post-completion integration process that takes longer than originally anticipated. There could be potential unknown liabilities and unforeseen expenses associated with the Omni Acquisition that were not discovered in the course of performing due diligence or that arise from the contemplated pre-closing reorganization or the combination of the businesses. If Omni has undisclosed liabilities, we, as a successor owner, will be responsible for such undisclosed liabilities and will not be indemnified for any of these liabilities. Such undisclosed liabilities could have an adverse effect on the business, results of operations, financial condition and cash flows of the Company after the closing of the Omni Acquisition.
Specifically, the following issues, among others, must be addressed as we continue to execute on the Omni integration in order to realize the anticipated benefits of the Omni Acquisition and realize the anticipated cost and revenue synergy opportunities:
•combining the companies' operations and corporate functions;
•combining the businesses of the Company and Omni and meeting the capital requirements of the combined company following the merger, in a manner that permits the combined company to achieve cost savings and revenue synergies anticipated to results from the merger, the failure of which would result in the anticipated benefits of the merger not being realized in the time frame currently anticipated or at all;
•integrating the companies' personnel;
•integrating the companies' technologies;
•integrating and unifying the offerings and services available to customers;
•identifying and eliminating redundant and underperforming functions and assets;
•harmonizing the companies' operating practices employee development and compensation programs, internal controls and other policies, procedures and processes;
•maintaining existing agreements with customers, providers and vendors and avoiding delays in entering into new agreements with prospective customers, providers and vendors;
•retaining existing customers and supplies, including those directly competing with Omni;
•addressing possible differences in business backgrounds, corporate cultures and management philosophies;
•consolidating the companies' administrative and information technology infrastructure;
•coordinating distribution and marketing efforts;
•managing the movement of certain positions to different locations;
•coordinating geographically dispersed organizations; and
•effecting actions that may be required in connection with obtaining the requisite regulatory approvals.
In addition, at times the attention of certain members of management and resources may be focused on the integration of the businesses of the two companies and diverted from day-to-day business operations or other opportunities that may have been beneficial to such company, which may disrupt our business.
We will incur significant transaction, merger-related and integration costs in connection with the Omni Acquisition.
The Company has incurred a number of non-recurring costs as well as transaction fees and other costs related to the Omni Acquisition. These costs and expenses include fees paid to financial, legal and accounting advisors, severance and other potential employment-related costs, including retention and severance payments that may be made to certain of our employees and Omni employees, filing fees, printing expenses and other related charges.
The Company will continue to incur integration costs following the Omni Acquisition as we continue to integrate a large number of processes, policies, procedures, operations, technologies, facilities and systems. Although we expect that the elimination of duplicative costs, strategic benefits, additional income as well as the realization of other efficiencies related to the integration of the businesses may offset incremental transaction, merger-related and integration costs over time, any net benefit may not be achieved in the near term or at all. While we assumed that certain expenses would be incurred in connection with the Omni Acquisition and the other transactions contemplated by the Amended Merger Agreement, there are many factors beyond our control that could affect the total amount or the timing of the integration and implementation expenses.
To augment the transportation capacity provided by Leased Capacity Providers, we purchase transportation from other third-party motor carriers, typically at a higher cost. As with Leased Capacity Providers, competition for third-party motor carriers is intense, and sometimes there are shortages of available third-party motor carriers. If we cannot secure a sufficient number of Leased Capacity Providers and have to purchase transportation from third-party carriers, our operating costs will increase. If our labor and operating costs increase, we may be unable to offset the increased costs by increasing rates without adversely affecting our business. As a result, our profitability and results of operations could be adversely affected.
Additionally, Leased Capacity Providers and third-party transportation capacity providers may also increase prices to cover higher operating expenses or if market conditions warrant. In some instances, we will have entered into fixed contract freight rates with customers and, in the event market conditions change and those contracted rates are below market rates, we may be required to provide transportation services at a loss.
If our labor and operating costs increase or if we are unable to pass on provider price increases to our customers, we may be unable to offset the increased costs by increasing rates without adversely affecting our business which could adversely affect our profitability and results of operations.
Higher prices by Leased Capacity Providers and other third-party transportation capacity providers could adversely impact our margins and operating results.
We are largely reliant on Leased Capacity Providers that lease their equipment to us and third-party transportation capacity providers to perform its freight transportation and other operations. These providers can be expected to charge higher prices if market conditions warrant or to cover higher operating expenses. Our profitability and income from operations may be impacted if we are unable to pass on such provider price increases to our customers. Increased demand for over the road transportation services and changes in regulations may reduce available capacity and increase pricing for both Leased Capacity Providers and third-party transportation providers. In some instances, we will have entered into fixed contract freight rates with customers and, in the event market conditions change and those contracted rates are below market rates, we may be required to provide transportation services at a loss.
We experience customer concentration which could adversely impact our financial condition and results of operations.
We experience customer concentration from time to time. During the year ended December 31, 2025, we derived 26% of our revenue from our top ten customers, with one customer accounting for just under 10% of our total revenue, which we expect to continue to grow in 2026. Any disruption in our business with those customers, whether as a result of changes in demand for our services, adverse changes in the customers’ industries generally or other challenges in securing or renewing contracts with those customers, could have a material adverse impact on our business, financial condition and results of operations.
The ineffectiveness of our fuel surcharge program could have a material adverse effect on our results of operations and profitability.
Fuel prices have fluctuated dramatically over recent years. Fuel availability and prices can be impacted by factors beyond our control, such as natural or man-made disasters, adverse weather conditions, political events, economic sanctions imposed against oil-producing countries or specific industry participants, disruption or failure of technology or information systems, price and supply decisions by oil producing countries and cartels, terrorist activities, armed conflict, tariffs, sanctions, other changes to trade agreements and world supply and demand imbalance. We have historically been able to mitigate the impact of these fluctuations through fuel surcharge programs. Our fuel surcharge rates are set weekly based on the national average for fuel prices as published by the U.S. Department of Energy and our fuel surcharge table. Our fuel surcharge revenue is the result of our fuel surcharge rates and the tonnage transiting our networks. The impact of fuel on our results of operations depends on the relationship between the applicable surcharge, the fuel efficiency of our Company drivers, and load factor achieved by our operations. Fluctuations in fuel prices in either direction could have a positive or negative impact on our margins, particularly in our LTL business where the weight of a shipment subject to the fuel surcharge on a given trailer can vary materially. There can be no assurance that our fuel surcharge revenue programs will be effective in mitigating the full impact of future increases in fuel prices. Conversely, decreases in fuel prices reduce the amount of revenue derived from our fuel surcharge programs and accordingly, could reduce our consolidated revenues and may reduce margins for certain businesses. If our fuel surcharge program is ineffective or insufficient to mitigate fuel price fluctuations, then such fluctuations may adversely impact our results of operations and overall profitability.
Changes to our senior management team and other key personnel, including turnover of our top executives,personnel could have an adverse effect on our business, operating results and financial condition.
Our success depends,depends to a large degree on the integration of our Chief Executive Officer and new members of our senior management team.team and on retaining key personnel. The ability of the Chief Executive Officer and other new members of our senior management team to further adapt to and better understand our business, operations, and strategic plans will beis critical to the Company and our management’s ability to make informed decisions about our near-term and long-term strategic direction and operations. Leadership transitions can be inherently difficult to manage, particularly when there is more than one transition occurring within the senior management team within a fiscal year,manage and an inadequate transition may cause disruption to our business due to, among other things, diverting management’s attention away from the Company’s financial and operational goals or causing a deterioration in morale.morale among key personnel. In addition, we may be unable to mitigate the risk if we are unable to implement and execute on an effective succession plan, and we may be unable to attract and retain qualified candidates in a timely manner. If we are unable to retain key senior executives and employees, our ability to meet our financial and operational goals and strategic plans may be adversely impacted, as well as our financial performance.
In addition, the successful integration of Omni depends in part on the retention of personnel critical to the business and operations of the Company following the Omni Acquisition due to, for example, their technical skills or management expertise.
In addition, the successful integration of Omni depends in part on the retention of personnel critical to the business and operations of the Company following the Omni Acquisition due to, for example, their technical skills or management expertise. Current and prospective employees of the Company and Omni may experience uncertainty about their future role with the Company and Omni until strategies with regard to these employees are announced or executed, which may impair our ability to attract, retain and motivate key management, sales, marketing, technical and other personnel following the Omni Acquisition. If we are unable to retain personnel, including our and Omni’s key management, who are critical to the successful integration and future operations of the business, we could face operational disruptions, loss of existing customers or loss of sales to existing customers, loss of key information, expertise or know-how, and unanticipated additional recruitment and training costs. In addition, the loss of key personnel could diminish the anticipated benefits of the Omni Acquisition.
In January 2025, the Board announced that it had initiated a comprehensive review of strategic alternatives to maximize shareholder value. The Board willcontinues to consider a range of options, including a potential sale, merger or other strategic or financial transaction relative to the long-term value potential of the Company on a standalone basis. The Board has not set a timetable for the conclusion of this review, nor has it made any decisions related to any further actions or potential strategic alternatives at this time. There can be no assurance that any transaction or other strategic outcome will be approved by the Board or otherwise consummated. Any potential transaction may be dependent on a number of factors that may be beyond our control, for example, market conditions, industry trends or acceptable terms. The process of reviewing potential strategic alternatives may be time consuming, distracting and disruptive to our business operations. In addition, given that the exploration of strategic alternatives may eventually result in a potential sale, merger or other strategic transaction, any perceived uncertainty regarding our future operations or employment needs may limit our ability to retain or hire qualified personnel and may contribute to unplanned loss of highly skilled employees through attrition, and result in the loss of customers, suppliers and other key business partners. We may ultimately determine that no transaction is in the best interest of our shareholders. If no transaction is completed, our stock price could decline, and we could experience negative market perception of disrupted business relationship as a result. Speculation regarding any developments associated with our review of strategic alternatives and any perceived uncertainties related to the Company or its business could cause the price of our shares to fluctuate significantly.
We may not achieve the anticipated long-term benefits of the Omni Acquisition or our ongoing business transformation, and related challenges, costs or inefficiencies could outweigh anticipated long-term benefits.
Following the completion of the Omni Acquisition and the integration of Omni into our business, we are focused on transforming our business and implementing new strategic objectives which we believe are designed to position the combined company for long-term growth. Our ability to realize the intended long-term benefits of this transformation depends on the successful execution of these new goals and strategies. These anticipated benefits include achieving planned revenue synergies, improving operational efficiency, and optimizing our corporate and organizational structure.
The expected benefits of the Omni Acquisition and our ongoing transformation may not be realized fully, may take longer to achieve than anticipated, or may result in unanticipated adverse effects. These risks are heightened by the prior dispute with Omni, which, although resolved, may impact our ability to achieve such benefits and synergies. In addition, certain assumptions we made at the time of the Omni Acquisition and related reorganization, including expected tax outcomes and revenue opportunities, may not be realized.
To achieve our transformation objectives and the anticipated benefits of the Omni Acquisition, we must effectively address, among other things:
•improving our technology;
•unifying the offerings and services available to customers;
•retaining existing customers and suppliers, including those directly competing with Omni; and
•consolidating our administrative technology infrastructure.
Moreover, at times, the attention of certain members of management and resources may be focused on the continued transformation of our business and diverted from day-to-day business operations or other opportunities which may have been beneficial to us, which may disrupt our operations.
Moreover, in the case of a change of control, amounts payable under the Tax Receivable Agreement may be accelerated and may significantly exceed the actual benefits we realize in respect of the tax attributes subject to the Tax Receivable Agreement. In particular, amounts payable under the Tax Receivable Agreement in the case of a change control may be substantially in excess of the net present value of the payments that the Company estimated would be required to be made to fulfill all Tax Receivable Agreement payment obligations with respect to equity issuances to the Omni Holders at and as of the date of the Omni Acquisition due to, among other things, contractual provisions that require the calculation to assume that all available tax benefits are used by the Company in each tax year. We expect that the payments that we may make under the Tax Receivable Agreement in the event of a change of control will be substantial. As a result, our accelerated payment obligations and/or the assumptions adopted under the Tax Receivable Agreement in the case of a change of control may impair our ability to consummate change of control transactions or negatively impact the value received by stockholders in a change of control transaction.
Concentration of ownership may limit your ability to influence corporate matters.
Based solely on our review of publicly available filings, as of December 31, 2025, our two largest stockholders collectively owned approximately 27% of our issued and outstanding shares of common stock, on an as converted and as exchanged basis. These stockholders could exert significant influence over the outcome of actions that require stockholder approval, including a significant corporate transaction in which stockholders might receive a premium over the prevailing market price for their shares. In addition, these stockholders may be able to delay or prevent changes in control or changes in management. Moreover, this concentration of stock ownership may also adversely affect the trading price of our common stock to the extent investors perceive a disadvantage in owning stock of a company with concentrated ownership.
Management's Discussion & Analysis (MD&A)
New heading “Key Operating Statistics”
New heading “Year Ended December 31, 2025 compared to Year Ended December 31, 2024”
New heading “Income (loss) from Operations”
New heading “Total Other Expense”
New heading “Net Loss Attributable to Noncontrolling Interest”
New heading “Expedited Freight - Year Ended December 31, 2025 compared to Year Ended December 31, 2024”
New heading “Omni Logistics - Year Ended December 31, 2025 compared to Year Ended December 31, 2024”
New heading “Salaries, Wages and Employee Benefits”
New heading “Income (Loss) from Operations”
New heading “Intermodal - Year Ended December 31, 2025 compared to Year Ended December 31, 2024”
New heading “Purchased Transportation”
New heading “Corporate - Year Ended December 31, 2025 compared to Year Ended December 31, 2024”
New heading “Annual Goodwill Analysis”
New heading “Credit Agreement”
Removed heading “Omni Acquisition”
Removed heading “Expedited Freight Acquisitions”
Removed heading “Recent Events and Factors Affecting Comparability”
Removed heading “Operating Revenues”
Removed heading “Income (loss) from Continuing Operations and Segment Operations”
Removed heading “Interest Expense, net”
Removed heading “Income Taxes on a Continuing Basis”
Removed heading “Expedited Freight - Year Ended December 31, 2024 compared to Year Ended December 31, 2023”
Removed heading “Operating Revenues”
Removed heading “Operating Leases”
Removed heading “Depreciation and Amortization”
Removed heading “Insurance and Claims”
Removed heading “Intermodal - Year Ended December 31, 2024 compared to Year Ended December 31, 2023”
Removed heading “Operating Revenues”
Removed heading “Other operations - Year Ended December 31, 2024 compared to Year Ended December 31, 2023”
Removed heading “Self-Insurance Loss Reserves”
Removed heading “Business Combinations and Goodwill”
Removed heading “Finite-Lived Intangible Assets and Other Long-Lived Assets”
Removed heading “Tax Receivable Agreement”
Removed heading “Year Ended December 31, 2023 compared to Year Ended December 31, 2022”
Removed heading “Senior Secured Term Loan Facility”
Largest changes
“The annual test of goodwill was performed for each of the reporting units with goodwill balances as of June 30, 2024. As a result of the annual test, we recorded goodwill impairment charges totaling $1,028,397 which all relates to our Omni reporting unit. This reporting unit was acquired on January 25, 2024. …”see in full comparison
“The Credit Agreement requires the Company to maintain a leverage ratio (as defined in the Credit Agreement), which is tested quarterly and currently must not be greater than 6.50 to 1.00. As of the year ended December 31, 2025, the Company’s leverage ratio is 5.50 to 1.00. The required leverage ratio will incrementally decrease by 25 basis points at the end of each quarter in 2026, to 5.50 to 1.00 at December 31, 2026, as defined in the agreement. …”see in full comparison
Both the Notes and Revolving Credit Facility contain covenants that, among other things, restrictsee in full comparisontheourability of us,ability, without the approval of the required lenders, to engage in certain mergers, consolidations, asset sales, dividends and stock repurchases, investments, and other transactions or to incur liens or indebtedness in excess of agreed thresholds, as set forth in thecreditCreditagreement.Agreement. The Revolving Credit Facility’s terms also include a financial covenant which requires us to maintain a specific leverageratio.ratio as follows: (i) 6.50:1.00 (for the fourth quarter of 2025), (ii) 6.25:1.00 (for the first quarter of 2026), (iii) 6.00:1.00 (for the second quarter of 2026), (iv) 5.75:1.00 (for the third quarter of 2026), (vi) 5.50:1.00 (for the fourth quarter of 2026 and thereafter). The Credit Agreement contains cross-default provisions. As such, if the requisite revolving lenders were to declare the amounts outstanding under the Revolving Credit Facility to be immediately due and payable as a result of a breach thereunder, the term loan lenders would have the right to accelerate the outstanding term loans and exercise other remedies available under the Credit Agreement. As of the date of this report, we were in compliance with all aforementioned covenants.
“We depend heavily upon the availability of adequate diesel fuel supplies. Fuel availability and prices can be impacted by factors beyond our control, such as natural or man-made disasters, adverse weather conditions, political events, economic sanctions imposed against oil-producing countries or specific industry participants, disruptions or failure of technology or information systems, price and supply decisions by oil producing countries and cartels, terrorist activities, armed conflict, tariffs, sanctions, other changes to trade agreements and world supply and demand imbalance. …”see in full comparison
“We test goodwill at the reporting unit level for impairment annually as of June 30 and on an interim basis when events occur or circumstances exist that indicate the carrying value may not be recoverable. We estimate the fair value of a reporting unit using a discounted cash flow (DCF), or as appropriate, a combination of the DCF and market approach known as the guideline public company approach. Under the DCF approach, we estimate the fair value of reporting units' cash flows at the weighted average cost of capital of a hypothetical third-party buyer. …”see in full comparison
“The annual test of goodwill was performed for each of the reporting units with goodwill balances as of June 30, 2025. As a result of the annual test, none of the reporting units were determined to be impaired, however the Omni reporting unit fair value was not substantially in excess of its carrying value. The fair value of the Omni reporting unit was estimated to be approximately 10% higher than the carrying value. …”see in full comparison
Full comparison: every changed paragraph (158)
This section of this Annual Report on Form 10-K generally discusses our results of operations and financial condition for the year ended December 31, 2024.2025. For a discussion of similar topics for the years ended December 31, 20232024 and December 31, 2022,2023, please refer to “Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K, filed on March 15,24, 2024,2025, which is incorporated herein by reference.
We are a leading asset-light freight provider of transportation services, including LTL, truckload and intermodal drayage services across the United States and in Canada and Mexico. We offer premium services that typically require precision execution, such as expedited transit, delivery during tight time windows and special handling. We utilize an asset-light strategy to minimize our investments in equipment and facilities and to reduce our capital expenditures. Globally, we provide customized asset-light, high-touch logistics and supplyvalue-added chain management solutionsservices with deep customer relationships in high-growth end markets.
Our Expedited Freight segment provides expedited regional, inter-regional and national LTL services. Expedited Freight also offers customers local pick-up and delivery and other services including truckload, shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling. We plan to grow our LTL geographic footprint through greenfield start-ups as well as through acquisitions.
Our Omni Logistics segment provides a full suite of global logistics services. Services include air and ocean freight consolidation and forwarding, customs brokerage, time-definite transportation services, contract logistics, which includes warehousing and distribution,value-added time-definiteservices, transportationas serviceswell andas other supply chain solutions. Other than revenue performance and given the service mix of Omni, key operating statistics are being determined as we continue to work through the integration.
Our Intermodal segment provides first- and last-mile high value intermodal container drayage services both to and from seaports and railheads. Intermodal also offers dedicated contract and CFS warehouse and handling services, and in select locations, linehaul and LTL services. We plan to grow our Intermodal geographic footprint through acquisitions as well as through greenfield start-ups where no suitable acquisition is available.
WeWith respect to our Expedited Freight and Intermodal reportable segments, in addition to our financial results, we monitor and analyze a number of key operating statistics in order to manage ourthese businesssegments and evaluate our financial andtheir operating performance. These key operating statistics are defined below and are referred to throughout the discussion of the financial results of our Expedited Freight, OmniFreight and Intermodal reportable segments. Our key operating statistics should not be interpreted as better measurements of our results than income from operations as determined under GAAP. As we continue to integrate the legacy Omni business, we measure and manage the performance of the Omni Logistics segment based on its revenue and income. We have not identified, nor do we utilize, any key operating statistics necessary to understand the operating results of our Omni Logistics reportable segment.
As we continue to integrate the Omni and Forward businesses, we are also developing how we organize and manage our product offerings. While we continue to manage the business by our disclosed segments below, we have information available to estimate revenue for key product groups for the period ended December 31, 2025. Estimated revenue for ground transportation, air & ocean forwarding, intermodal drayage, and contract logistics approximated 63%, 13%, 9% and 15% of operating revenue, respectively during 2025.
Key Operating Statistics
Within our Expedited Freight reportable segment, our primary revenue focus is to increaseoptimize density, which is shipmentto obtain appropriate pricing of our services that allows for profitable shipments and tonnage growth within our existing LTL network. Increases in density allow us to maximize our asset utilization and labor productivity, which we measure over many different functional areas of our operationsoperations, including linehaul load factor and door pounds handled per hour. In addition to our focus on density and operating efficiencies, it is critical for us to obtain an appropriate yield, which is measured as revenue per hundredweight, on the shipments we handle to offset our cost inflation and support our ongoing investments in capacity and technology. Revenue per hundredweight is also a commonly-used indicator for general pricing trends in the LTL industry and can be influenced by many other factors, such as changes in fuel surcharges, weight per shipment and length of haul. Therefore, changes in revenue per hundredweight may not necessarily indicate actual changes in underlying base rates. We regularly monitor the components of our pricing, including base freight rates, accessorial charges and fuel surcharges. The fuel surcharge is generally designed to offset fluctuations in the cost of the petroleum-based products used in our operations by passing changes in such costs on to customers and is indexed to diesel fuel prices published by the U.S. Department of Energy.Energy on a weekly basis. The impact of fuel on our results of operations depends on the relationship between the applicable surcharge, the fuel efficiency of our Company drivers, and the load factor achieved by our operation. Fluctuations in fuel prices in either direction could have a positive or negative impact on our margins, particularly in our LTL business where the weight of a shipment subject to the fuel surcharge on a given trailer can vary materially. We believe our yield management process focused on account level profitability, and ongoing improvements in operating efficiencies, are both key components of our ability to grow profitably.
The key operating statistics necessary to understand the operating results of our Expedited FrightFreight reportable segment are described below in more detail:
Omni Acquisition
In January 2024, we acquired Omni for a combination of (a) $100,499 million in cash and (b) (i) common equity consideration representing 14,015 shares of our common stock on an as-converted and as-exchanged basis. Omni, headquartered near Dallas, Texas, is an asset-light, high-touch logistics and supply chain management company with customer relationships in high-growth end markets. Omni delivers domestic and international freight forwarding, fulfillment services, customs brokerage, distribution, and value-added services for time-sensitive freight to U.S.-based customers operating both domestically and internationally.
Expedited Freight Acquisitions
In January 2023, we acquired certain assets of Land Air Express, Inc. (“Land Air”) for $56,567. Land Air, headquartered in Bowling Green, Kentucky, offers a variety of less-than-truckload services including guaranteed, standard, exclusive, same day, hot shot and pickup and delivery, and operates in over 25 terminals across the United States. The acquisition of Land Air is expected to accelerate the expansion of our national terminal footprint, particularly in the middle part of the United States, and strategically position us to better meet the current and future needs of customers. The acquisition was funded using cash flow from operations and proceeds from our credit facility. The results of Land Air have been included in our Consolidated Financial Statements as of and from the date of acquisition. The associated goodwill has been included in our Expedited Freight reportable segment.
See Note 3, Acquisitions, to our Consolidated Financial Statements for more information about our acquisitions.
Fuel
We depend heavily upon the availability of adequate diesel fuel supplies. Fuel availability and prices can be impacted by factors beyond our control, such as natural or man-made disasters, adverse weather conditions, political events, economic sanctions imposed against oil-producing countries or specific industry participants, disruptions or failure of technology or information systems, price and supply decisions by oil producing countries and cartels, terrorist activities, armed conflict, tariffs, sanctions, other changes to trade agreements and world supply and demand imbalance. Through our fuel surcharge programs, we are able to mitigate the impact of fluctuations in fuel prices. Our fuel surcharge rates are set weekly based on the national average for fuel prices as published by the U.S. Department of Energy and our fuel surcharge table. In periods of changing fuel prices, our fuel surcharges vary by different degrees and may not fully offset fuel price fluctuations or may result in higher than expected increases in revenue. Fuel shortages, changes in fuel prices, and the potential volatility in fuel surcharge revenue may impact our results of operations and overall profitability. Fuel surcharge revenue as a percentage of operating revenues decreased to 17.9% for the year ended December 31, 2024 compared to 18.9% for the year ended December 31, 2023, as a result of changes in fuel prices.
Our business is highly susceptible to changes in economic conditions. Our products and services are directly tied to the production and sale of goods and, more generally, to the North Americanglobal economy. Participants in the transportation industry have historically experienced cyclical fluctuations in financial results due to economic recessions, downturns in the business cycles of customers, volatility in the prices charged by third-party carriers, interest rate fluctuations and other U.S. and global macroeconomic developments. During economic downturns, reductions in overall demand for transportation services will likely reduce demand for our services and exert downward pressure on our rates and margins. In periods of strong economic growth, overall demand may exceed the available supply of transportation resources. While this may present an opportunity to increase economies of scale in our network and enhanced pricing and margins, these benefits may be lessened by increased network congestion and operating inefficiencies.
Like other providers of freight transportation services, our business has been impacted by the macroeconomic conditions of the past year. Industry freight volumes, as measured by the Cass Freight Index, decreased throughout 2025 as compared to 2024. Recent global disruptions, including proposed changes and implemented changes to tariff rates, as described below, have had an impact on freight demand, which has led to an overall continued decrease in total number of shipments. Such disruptions are expected to continue with a resolution timeline remaining unclear. Intermodal volumes, heavily influenced by United States imports, have decreased due to a number of factors that impact import levels. For Truckload, capacity levels relative to demand have created a sustained market of depressed spot market truckload rates.
Amid broader volatility in the global economy, the U.S. government has recently proposed and imposed significant widespread baseline and country-specific tariffs on imported goods from China, Canada, and other countries. While the implementation of certain country-specific tariffs with most countries has been delayed as negotiations progress, the extent of the risk of tariffs remains uncertain. While the ultimate impact of tariff policy changes is unclear, we are actively monitoring these developments and remain committed to taking appropriate measures to maintain our competitiveness and adapt to changing economic conditions.
Like other providers of freight transportation services, our business has been impacted by the macroeconomic conditions of the past year. Industry freight volumes, as measured by the Cass Freight Index, decreased in 2024 compared to 2023, which was down as compared to 2022. Transportation rates continued to decline throughout 2024 as carrier capacity exceeded shipper demand in the United States. This period of weak consumer demand has nearly eliminated the challenges from port congestion and transportation equipment shortages as seen in prior years. Despite the weak demand, new vessel deliveries continue to add capacity and new vessel deliveries are expected to continue in the near term. Recent global disruptions have impacted the capacity market, and the disruptions are expected to continue, although the timeline to resolution remains unclear. The air freight market has seen an increase in capacity resulting from increased commercial flight activity to support elevated consumer travel. Intermodal volumes, heavily influenced by United States imports, have declined for much of 2024 due to inflation, customer demand and a shift of spending by consumers from goods to services. For Truckload, the capacity contraction has created a sustained market of depressed spot market truckload rates with modest signs of improvement, especially in Q4 of 2024. These trends drove a decline in the volume of freight shipped by our customers and placed pressure on rates in a soft freight environment. While these trends may continue through the early months of 2025, industry projections expect a slight improvement in the fundamentals within the freight market in 2025.
In January 2025, the Board announced that it had initiated a comprehensive review of strategic alternatives to maximize shareholder value. The Board willis continuing to consider a range of options, including a potential sale, merger or other strategic or financial transaction relative to the long-term value potential of the Company on a standalone basis. The Board has retained Goldman Sachs & Co. LLC to serve as its financial advisor. The Board has not set a timetable for the conclusion of this review, nor has it made any decisions related to any further actions or potential strategic alternatives at this time. There can be no assurance that any transaction or other strategic outcome will be approved by the Board or otherwise consummated. The Company does not intend to disclose developments relating to this process until it determines that further disclosure is appropriate or necessary.
Recent Events and Factors Affecting Comparability
Omni AcquisitionIntegration
On January 25, 2024, the Company completed the acquisition (the “Closing”) of Omni Newco, LLC ("Omni" and the acquisition of Omni, the "Omni Acquisition"), after which, we disclosed certain expectations regarding potential synergies from the acquisition and highlighted issues that would have to be addressed as we execute on the Omni integration, which issues are described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, “Risk Factors” - under the title “The Omni Acquisition may not achieve its intended benefits, and certain difficulties, costs or expenses may outweigh such intended benefits.” Since that time, we have made significant progress on our integration plans and exceeded our initial expectations regarding cost synergies. However, there are continued uncertainties that may affect our ability to successfully complete the full integration of the Omni business or realize its anticipated long-term benefits including revenue synergies. Specifically, we are continuing to integrate operational and administrative technology platforms and systems which are critical to our operational processes and administrative functions, as well as customer service and experience. In addition, as previously disclosed, we are implementing a transformation of the combined business which includes evaluating and integrating the solutions and service offerings available to our customers in order to maximize revenues and efficiencies. Finally, we continue to execute on strategies to retain existing customers and vendors as we finalize our transformation and implement any resulting changes to our business and operations.
On January 25, 2024, we completed the Omni Acquisition pursuant to which we acquired Omni for a combination of (a) $100,499 in cash (which includes pre-acquisition Omni costs of approximately $80 million) (b) 14,015 shares of common stock on an as-converted and as-exchanged basis consisting of: (i) 1,910 shares of common stock (of which 1,210 were issued upon conversion of the Series C Preferred Units upon the Conversion Approval) and (ii) 12,105 Opco Class B Units and corresponding Series B Preferred Units, which are exchangeable into shares of common stock (of which 7,670 units were issued upon conversion of the units of Opco designated as “Opco Series C-2 Preferred Units” upon the Conversion Approval).
See Note 3, Acquisitions, to our Consolidated Financial Statements for more information about our acquisitions.
Omni revenues and segment income from January 25, 2024 through December 31, 2024 are included in our consolidated statements of comprehensive (loss) income for the year ended December 31, 2024.
Year Ended December 31, 2025 compared to Year Ended December 31, 2024
The following table sets forth our consolidated financial data for the years ended December 31, 2025 and 2024:
Operating revenues increased $20,856, or 0.8% to $2,495,118 for the year ended December 31, 2025 compared to $2,474,262 for the same period in 2024. This increase was primarily due to the Omni Logistics segment having an extra twenty-four days included in 2025 as compared to 2024 given that the Omni Acquisition closed in January 2024. The increase in operating revenues was partially offset by a decrease in our Expedited Freight segment revenue of $102,604 due to decreased Network volume. The results for our reportable segments are discussed in detail in the following sections.
Operating expenses decreased $1,078,504, or 30.5%, to $2,458,694 for the year ended December 31, 2025 compared to $3,537,198 for the same period in 2024. The decrease was primarily due to a goodwill impairment charge of $1,028,397 incurred in the prior year period and decreases in acquisition and integration costs associated with the Omni Acquisition. Such decreases were partially offset by the increases in operating expenses from the Omni Logistics segment having an extra twenty-four days included in the year ended December 31, 2025 as compared to the same period in 2024. Additionally, in fourth quarter of 2025 the Company recorded a $19,765 charge to Other operating expenses for the impairment of abandoned software projects, which included $16,199 of cloud computing implementation costs and $3,566 of capitalized internal-use software.
Income (loss) from Operations
Income (loss) from operations increased by $1,099,360, or 103.4%, to income of $36,424 for the year ended December 31, 2025, compared to a $1,062,936 loss for the same period in 2024. The increase was primarily driven by the goodwill impairment charge from 2024 noted above, which did not occur in 2025.
Total Other Expense
Total other expense decreased $3,275, or 1.8%, to expense of $183,621 for the year ended December 31, 2025 compared to an expense of $186,896 for the same period in 2024. The decrease was due to the decrease in interest expense resulting from lower variable interest rates partially offset by loss on foreign currency exchange.
Income Taxes
The effective tax rate for the year ended December 31, 2025 was 3.7% compared to a rate of 10.0% for the same period in 2024. The effective tax rate for the year ended December 31, 2025 is lower than the prior year due to the tax impacts related to the goodwill impairment charge in the prior year that did not reoccur.
Income (loss) from discontinued operations net of tax of $6,387, for the year ended December 31, 2024 was related to the final net working capital settlement following the sale of our Final Mile business in December 2023. There was no income or loss from discontinued operations for the year ended December 31, 2025.
As a result of the foregoing factors, net loss decreased $989,503, or 87.5%, to a net loss of $141,725 for the year ended December 31, 2025 compared to the net loss of $1,131,228 for the same period in 2024. The decrease is primarily related to $1,028,397 goodwill impairment charge incurred in the prior year that did not occur in the current year.
Net Loss Attributable to Noncontrolling Interest
The decrease in net loss attributable to noncontrolling interest for the year ended December 31, 2025, compared to the same period in 2024, is being driven by the decrease in net loss and the decreasing number of noncontrolling units outstanding for the respective periods.
Expedited Freight - Year Ended December 31, 2025 compared to Year Ended December 31, 2024
The following table sets forth our financial data of the Expedited Freight segment for the years ended December 31, 2025 and 2024:
Operating revenue decreased $102,604, or 9.2%, to $1,012,559 for the year ended December 31, 2025 from $1,115,163 for the same period in 2024. The decrease was driven by decreased Network revenue. Network revenue decreased due to a 12.1% decrease in tonnage as a result of softer demand and was partially offset by a 2.6% increase in revenue per hundredweight ex fuel as compared to the same period in the prior year. The decrease in tonnage reflects an increase in weight per shipment of 0.3% on 12.3% fewer shipments.
Purchased transportation expense decreased by $54,541, or 10.0%, to $491,917 for the year ended December 31, 2025 from $546,458 for the same period in 2024. Purchased transportation was 48.6% of Expedited Freight operating revenue for the year ended December 31, 2025 compared to 49.0% for the same period in 2024. Purchased transportation includes Leased Capacity Providers, third-party motor carriers, and transportation intermediaries, while Company-employed drivers are included in salaries, wages and employee benefits. The decrease in purchased transportation was primarily due to decreased shipments for the year ended December 31, 2025 as compared to the same period in 2024.
Salaries, wages and employee benefits decreased by $31,993, or 13.2%, to $210,418 for the year ended December 31, 2025 from $242,411 for the same period in 2024. Salaries, wages and employee benefits were 20.8% of Expedited Freight operating revenue for the year ended December 31, 2025 compared to 21.7% for the same period in 2024. The decrease in salaries, wages and employee benefits expense was primarily due to the lower volumes for the year ended December 31, 2025 as compared to the same period in 2024.
Other operating expenses decreased $13,999, or 14.0%, to $85,639 for the year ended December 31, 2025 from $99,638 for the same period in 2024. Other operating expenses were 8.5% of Expedited Freight operating revenue for the year ended December 31, 2025 compared to 8.9% for the same period in 2024. Other operating expenses include contract labor, equipment maintenance, facility expenses, legal and professional fees, and other over-the-road costs. The decrease in other operating expenses was primarily due to acquisition and integration synergies as well as reduction in shipments for the year ended December 31, 2025 as compared to the same period in 2024.
Income from operations increased by $1,829, or 2.7%, to $69,780 for the year ended December 31, 2025 compared to $67,951 for the same period in 2024. Expedited Freight income from operations was 6.9% of operating revenue for the year ended December 31, 2025, compared to 6.1% for the same period in 2024. The increase in income from operations was driven by improved cost management relative to the lower freight volumes for year ended December 31, 2025 as compared to the same period in 2024.
Omni Logistics - Year Ended December 31, 2025 compared to Year Ended December 31, 2024
The following table sets forth our financial data of the Omni Logistics segment for the years ended December 31, 2025 and 2024:
Operating revenues increased $154,323, or 12.9%, to $1,351,164 for the year ended December 31, 2025 from $1,196,841 for the same period in 2024. This is partially due to the increase in ownership days during the current year period, as well as an increase in revenue per day during 2025 due to increased demand for contract logistics.
Purchased transportation increased $73,750, or 10.5%, to $774,785 for the year ended December 31, 2025 from $701,035 for the same period in 2024. Purchased transportation was 57.3% of operating revenues for year ended December 31, 2025 compared to 58.6% for the same period in 2024. Purchased transportation increased primarily due to the increase in ownership days and demand for our services during the current year period, but decreased as a percentage of revenue due to a shift in product mix. This shift in product mix consisted of an increase in contract logistics that require lower purchase transportation levels as compared to ground, air and ocean services.
Salaries, Wages and Employee Benefits
Salaries, wages and employee benefits increased $16,620 or 7.7%, to $232,138 for the year ended December 31, 2025 from $215,518 for the same period in 2024. Salaries, wages and employee benefits were 17.2% of operating revenues for the year ended 2025 compared to 18.0% for the same period in 2024. While salaries, wages and employee benefits increased mainly due to the increase in ownership days, the salaries, wages and benefits as a percentage of operating revenues decreased due to acquisition and integration synergies.
Operating leases increased $18,073 or 18.7% to $114,573 for the year ended December 31, 2025 from $96,500 for the same period in 2024. Operating leases increased primarily due to the increase in ownership days.
Depreciation and amortization increased $9,997 or 12.0% to $93,539 for the year ended December 31, 2025 from $83,542 for the same period in 2024. Depreciation and amortization increased as a result of the increase in ownership days of Omni Logistics in 2025 as compared to 2024.
Income (Loss) from Operations
Income from operations increased $1,074,965 or 102.9%, to an income of $30,162 for the year ended December 31, 2025 compared to a $1,044,803 loss for the same period in 2024. The increase was primarily due to no goodwill impairment charge in the current year period relative to the $1,028,397 goodwill impairment charge in the prior year period.
Intermodal - Year Ended December 31, 2025 compared to Year Ended December 31, 2024
What changed in the latest 10-Q
Risk Factors
Largest changes
“Although we entered into a non-binding memorandum of understanding with the Customer regarding the continued provision of at least half of the approximate $250 million of revenue attributable to the Customer for the year ended December 31, 2025, we are continuing to negotiate a definitive agreement with the Customer with respect to the retention of services and the terms of the transition of services that are not being retained, including any related termination or disentanglement fees and the transfer of any leases. …”see in full comparison
“While there can be no assurances as to the portion of the business that will be transitioned, transition timing or transition plan, the Company’s existing agreements with the Customer contemplate a transition period in some cases of up to 24 months. Forward Air expects an orderly transition and is in the process of negotiating the scope of the transition, as well as disentanglement fees in respect of transition-related costs. …”see in full comparison
In January 2025, the Board of Directors (the “Board”) initiated a comprehensive review of strategic alternatives to maximize shareholder value, exploring a range of options relative to the long-term value potential of the Company on a standalone basis. The process included extensive negotiations and discussions with multiple parties. However, due to a variety of factors no actionable proposals for a sale of the Company were ultimately received. The Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value, and has determined to pursue a potential sale of non-core assets, including our Intermodal segment and two of our smaller legacy Omnisee in full comparisonbusinesses.businesses, the first of which closed during the second quarter of 2026 and the second of which closed in July 2026.
see in full comparisonWhileAsnopreviouslyformaldisclosed,notices of terminationwe have beendelivered, we are currentlyin active discussions with the Customer regarding the transition of asignificantportion of the Customer’s contract logistics business with us to other suppliers for reasons related to the Customer’s operations and supplier diversification initiatives.
Full comparison: every changed paragraph (5)
In January 2025, the Board of Directors (the “Board”) initiated a comprehensive review of strategic alternatives to maximize shareholder value, exploring a range of options relative to the long-term value potential of the Company on a standalone basis. The process included extensive negotiations and discussions with multiple parties. However, due to a variety of factors no actionable proposals for a sale of the Company were ultimately received. The Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value, and has determined to pursue a potential sale of non-core assets, including our Intermodal segment and two of our smaller legacy Omni businesses.businesses, the first of which closed during the second quarter of 2026 and the second of which closed in July 2026.
Our top ten customers, based on revenue, accounted for approximately 26% of our revenue for the year ended December 31, 2025, with one customer (the “Customer”) accounting for slightly less than 10% of consolidated operating revenues for year ended December 31, 2025, and approximately 12% of consolidated operating revenues for both the three and six months ended MarchJune 31,30, 2026. These customers can impact our revenues and profitability based on factors such as: (i) industry trends related to e-commerce that may apply downward pricing pressures on the rates our customers can charge; (ii) seasonality; (iii) business combinations and the overall growth of a customer’s underlying business; and (iv) any disruptions to our customers’ businesses.
WhileAs nopreviously formaldisclosed, notices of terminationwe have been delivered, we are currently in active discussions with the Customer regarding the transition of a significant portion of the Customer’s contract logistics business with us to other suppliers for reasons related to the Customer’s operations and supplier diversification initiatives.
Although we entered into a non-binding memorandum of understanding with the Customer regarding the continued provision of at least half of the approximate $250 million of revenue attributable to the Customer for the year ended December 31, 2025, we are continuing to negotiate a definitive agreement with the Customer with respect to the retention of services and the terms of the transition of services that are not being retained, including any related termination or disentanglement fees and the transfer of any leases. If the Customer transitions a greater portion of its business than currently anticipated, or if the anticipated transition otherwise occurs on terms less favorable than expected, our business, financial condition and/or operating results will be materially adversely affected. In addition, we expect that any definitive agreement with the Customer will contain customary termination rights which, if exercised could, in the future, have a negative impact on our business, financial condition and/or operating results.
While there can be no assurances as to the portion of the business that will be transitioned, transition timing or transition plan, the Company’s existing agreements with the Customer contemplate a transition period in some cases of up to 24 months. Forward Air expects an orderly transition and is in the process of negotiating the scope of the transition, as well as disentanglement fees in respect of transition-related costs. Given the revenue and profitability relating to the services provided to the Customer, if the Customer transitions all or a significant portion of the business to other suppliers, our business, financial condition and/or operating results will be materially adversely affected.
Management's Discussion & Analysis (MD&A)
New heading “Cautionary Statement Regarding Forward-Looking Statements”
New heading “The following management’s discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in Part I, Item 1 in this Quarterly Report and our audited consolidated financial statements as of December 31, 2025, included in our Annual Report.”
New heading “Results from Operations — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025”
New heading “Operating (Loss) Income”
New heading “Net Loss Attributable to Noncontrolling Interest”
New heading “Impairment of Goodwill”
New heading “Intermodal — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025”
New heading “Insurance and Claims”
New heading “Operating Expenses”
New heading “Operating (Loss) Income”
New heading “Total Other Expense”
New heading “Net Loss Attributable to Noncontrolling Interest”
New heading “Expedited Freight — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025”
New heading “Salaries, Wages, and Employee Benefits”
New heading “Operating Income”
New heading “Omni Logistics — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025”
New heading “Insurance and Claims”
New heading “Impairment of Goodwill”
New heading “Operating (Loss) Income”
New heading “Salaries, Wages, and Employee Benefits”
New heading “Operating Income”
New heading “Corporate — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025”
Removed heading “Results from Operations”
Removed heading “Income from Operations”
Removed heading “Purchased Transportation”
Removed heading “Purchased Transportation”
Removed heading “Purchased Transportation”
Removed heading “Other Operating Expenses”
Removed heading “Forward-Looking Statements”
Largest changes
“Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. …”see in full comparison
“In this Form 10-Q, forward-looking statements include, but are not limited to, any statements regarding: (i) any projections of earnings, revenues, other financial items or related accounting treatment, or cost reduction measures, including any impact of the Omni Acquisition on our financial statements; (ii) future performance, including any expectations about our ability to increase shipments; (iii) our ability to maintain compliance with the covenants of our indebtedness instruments; …”see in full comparison
“This Quarterly Report on Form 10-Q (our “Quarterly Report”) contains “forward-looking statements,” as defined in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance. Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects,” “expects.” or the negative thereof. …”see in full comparison
“The Customer has been growing their relationship with the Company over the past two years and their revenue represented slightly less than 10% of the Company’s revenue for the year ended December 31, 2025, and approximately 12% of consolidated operating revenues for the three months ended March 31, 2026. The Customer is concentrated in the Omni Logistics segment. …”see in full comparison
Full comparison: every changed paragraph (127)
Cautionary Statement Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q (our “Quarterly Report”) contains “forward-looking statements,” as defined in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance. Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects,” “expects.” or the negative thereof. However, the absence of these words does not mean that the statements are not forward-looking. These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause or contribute to a material difference include those risks discussed under Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 (our “Annual Report”), as well updates to the risks included in Part II, Item 1A. “Risk Factors” in this Quarterly Report and our other filings with the Securities and Exchange Commission. All forward looking statements set forth in this Quarterly Report are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence to or effects on the Company or its business or operations. Forward-looking statements set forth in this Quarterly Report speak only as of the date hereof, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
The following management’s discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in Part I, Item 1 in this Quarterly Report and our audited consolidated financial statements as of December 31, 2025, included in our Annual Report.
WeForward areAir Corporation and its subsidiaries (collectively, the “Company,” “Forward Air,” “we,” “our,” or “us”) is a leading asset-light provider of transportation services. We provide ground transportation, air and ocean forwarding, intermodal drayage services and contract logistics across North and South America, Europe and Asia. We also provide customized asset-light, high-touch logistics and supply chain management solutions with deep customer relationships in high-growth end markets. We offer premium services that typically require precision execution, such as expedited transit, delivery during tight time windows and special handling. We utilize an asset-light strategy to minimize our investments in equipment and facilities and to reduce our capital expenditures.
Our Expedited Freight segment provides expedited regional, inter-regional and national Less-Than-Truckload (“LTL”) services. Expedited Freight also offers customers local pick-up and delivery and other services including truckload, shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling.
Our Intermodal segment provides first- and last-mile high value intermodal container drayage services both to and from seaports and railheads. Intermodal also offers dedicated contract and Container Freight Station (“CFS”) warehouse and handling services, and in select locations, linehaul and LTL services.
Our operations, particularly our network of hubs and terminals, representinvolve substantial fixed costs. Consequently,Accordingly, our ability to increase ourimprove earnings depends in significant part on our ability to increase thefreight amount of freightvolumes and theenhance revenue per pound or per shipment for the freight shipped or moved through our network. Additionally,In addition, our earnings dependare onaffected by the growth of other services, such as LTL pickup and delivery, which will allow us to maintainsupport revenue growth in a challenging freight environment. We continue to focus on creating synergies across our services,service offerings, particularly withthose services offered inwithin our Expedited Freight reportable segment. SynergisticThese opportunitiessynergies include the ability to share resources, in particularespecially our fleet resources.fleet.
With respect to our Expedited Freight and Intermodal reportable segments, in addition to monitoring our financial results, we monitor and analyze a number of key operating statistics in order to manage these segments and evaluate their operating performance. These key operating statistics are defined below and are referred to throughout the discussion of the financial results of our Expedited Freight and Intermodal reportable segments. Our key operating statistics should not be interpreted as better measurements of our results than operating income from operations as determined under GAAP. As we continue to integrate the legacy Omni business, we measure and manage the performance of the Omni Logistics segment based on its revenue and income. We have not identified, nor do we utilize, any key operating statistics necessary to understandmanage this segment and evaluate the operating resultsoperations of our Omni Logistics reportable segment.
Within our Expedited Freight reportable segment, our primary revenue focus is to optimize density, which is to obtain appropriate pricing of our services that allows for profitable shipments and tonnage growth within our existing LTL network. Increases in density allow us to maximize our asset utilization and labor productivity, which we measure over many different functional areas of our operations, including linehaul load factor and door pounds handled per hour. In addition to our focus on density and operating efficiencies, it is critical for us to obtain an appropriate yield, which is measured as revenue per hundredweight, on the shipments we handle to offset our cost inflation and support our ongoing investments in capacity and technology. Revenue per hundredweight is also a commonly used indicator for general pricing trends in the LTL industry and can be influenced by many other factors, such as changes in fuel surcharges, weight per shipment and length of haul. Therefore, changes in revenue per hundredweight may not necessarily indicate actual changes in underlying base rates. We regularly monitor the components of our pricing, including base freight rates, accessorial charges and fuel surcharges. The fuel surcharge is generally designed to offset fluctuations in the cost of the petroleum-based products used in our operations by passing changes in such costs on to customers and is indexed to diesel fuel prices published by the U.S. Department of Energy on a weekly basis. The impact of fuel on our results of operations depends on the relationship between the applicable surcharge, the fuel efficiency of our Company drivers, and the load factor achieved by our operation. Fluctuations in fuel prices in either direction could have a positive or negative impact on our margins, particularly in our LTL business where the weight of a shipment subject to the fuel surcharge on a given trailer can vary materially. We believe our yield management process focused on account level profitability, andcombined with ongoing improvements in operating efficiencies, are both key components of our ability to growachieve profitably.profitable growth.
The key operating statistics necessary to understand the operating results of our Expedited FrightFreight reportable segment are described below in more detail:
•Tonnage - —Total weight of shipments in pounds. The level of freight tonnage is affected by economic cycles and conditions, customers’ business cycles, changes in customers’ business practices and capacity in the truckload market.
•Weight Per Shipment - —Total pounds divided by the number of shipments. Fluctuations in weight per shipment can indicate changes in the mix of freight we receive from our customers, as well as changes in the number of units included in a shipment. Generally, increases in weight per shipment indicate higher demand and overall increased economic activity. Changes in weight per shipment can also be influenced by shifts between LTL and other modes of transportation, such as truckload, in response to capacity, service and pricing issues. Fluctuations in weight per shipment generally have an inverse effect on our revenue per hundredweight, as a decrease in weight per shipment will typically cause an increase in revenue per hundredweight.
•Revenue Per Hundredweight - —Network revenue per every 100 pounds of shipment weight. Our LTL transportation services are generally priced based on weight, commodity, and distance. Our pricing policies are reflective of the services we provide and can be influenced by competitive market conditions. Changes in the freight profile factors such as average shipment size, average length of haul, freight density, and customer and geographic mix can impact the revenue per hundredweight. Fuel surcharges and intercompany revenue between Network and Truckload are included in this measurement.
•Revenue Per Shipment - —Network revenue divided by the number of shipments. Fuel surcharges and intercompany revenue between Network and Truckload are included in this measurement.
•Average Length of Haul - —Total miles between origin and destination service centers for all shipments, with miles based on the size of shipments. Length of haul is used to analyze our tonnage and pricing trends for shipments with similar characteristics. Changes in length of haul generally have a direct effect on our revenue per hundredweight, as an increase in length of haul will typically cause an increase in revenue per hundredweight.
•Drayage Revenue Per Shipment - —Intermodal revenue divided by the number of drayage shipments. Revenue derived from container freight stationCFS warehouse and handling, and linehaul and LTL services is excluded from this measurement. Fuel surcharges and accessorial charges are included in this measurement.
Like other providers of freight transportation services, our business has been impacted by the macroeconomic conditions of the past few years. Industry freight volumes, as measured by the Cass Freight Index, decreased in the first quarterhalf of 2026 compared to the comparable period in 2025. Recent global disruptions, such as conflicts in the Middle East, have had an impact on freight demand, which has led to an overall continued decrease in total number of shipments. Such disruptions may continue with a resolution timeline remaining unclear. Intermodal volumes, heavily influenced by United States imports, have decreased due to a number of factors that impact import levels. For Truckload, starting in late 2025 and into 2026, tightening capacity levels with relatively stabilized demand have created a increase in spot market truckload rates.
For Truckload, starting in late 2025 and into 2026, tightening capacity levels with relatively stabilized demand have created an increase in spot market truckload rates. Spot rates have been further impacted by increases in fuel costs, which increase our fuel surcharge revenue and also increase the cost of purchased transportation.
In January 2025, the Board of Directors (the “Board”) announced that it had initiated a comprehensive review of strategic alternatives to maximize shareholder value and retained Goldman Sachs & Co. LLC to serve as its financial advisor. This process included extensive negotiations and discussions with multiple parties; however, due to a variety of factors, no actionable proposals for a sale of the Company were ultimately received.
ToAs enhance the executionpart of its ongoing efforts to execute the Company’s strategic plan toand drive value creation for all shareholders, the Board has determinedauthorized tothe pursueexploration aof potential saletransactions ofinvolving certain non-core assets, including the Company's Intermodal segment, and certain components of the Omni Logistics segment,segment. asThe partCompany ofexpects itssuch effortsactions, if consummated, to streamlinesupport andportfolio focusoptimization, itsenhance portfolio,liquidity, andreduce generate additional cash to further deleverageleverage, and strengthen its balance sheet. The Company completed the sale of two business units within its Omni Logistics segment, the first of which closed during the second quarter of 2026 and the second of which closed in July 2026. In addition to these actions, the Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value.
There can be no assurances that any additional sale or other transaction will be approved by the Board or otherwise consummated. The Company does not intend to disclose developments relating to these initiatives until it determines that further disclosure is appropriate or necessary.
WhileDuring nothe formalfirst noticesquarter of termination2026, havewe beencommenced delivered, the Company is currently in activepreliminary discussions with itsour largest customer (the “Customer”), regarding thea potential transition of a significant portion of the Customer’sCustomer's contract logistics business to other suppliers for reasons related to the Customer’sCustomer's operations and supplier diversification initiatives. ForwardDuring Airthe hassecond quarter of 2026, these discussions progressed, and we engaged in more advanced negotiations. We have provided the highest level of service excellence and exceeded all of itsour KPIs on a regular basis throughout the duration of itsour 25-year relationship.relationship with the Customer. The Customer continued growing their relationship with us over the past two years. Their revenue represented slightly less than 10% of our consolidated operating revenue for the year ended December 31, 2025, and approximately 12% of consolidated operating revenues for both the three and six months ended June 30, 2026. The Customer is concentrated in the Omni Logistics segment.
In July 2026, we entered into a non-binding memorandum of understanding (the “MOU”), pursuant to which we would retain approximately 50% of the services revenue provided to the Customer in 2025, with the potential of retaining an additional 25% of service revenues, subject to the execution of a definitive agreement. The transfer of the portion of the business that is expected to be transitioned to third parties is expected to begin in December 2026 with the transition continuing through 2027. We continue to negotiate the terms of the transition, including any related termination or disentanglement fees and the transfer of any leases. Additionally, we continue to explore all options to retain as much of this business as possible.
While there can be no assurances as to the portion of the business that will be transitioned, transition timing or transition plan, the Company’s existing agreements with the Customer contemplate a transition period in some cases of up to 24 months. Forward Air expects an orderly transition and is in the process of negotiating the scope of the transition, as well as disentanglement fees in respect of transition related costs. Forward Air is exploring all options to retain as much of this business as possible.
The Customer has been growing their relationship with the Company over the past two years and their revenue represented slightly less than 10% of the Company’s revenue for the year ended December 31, 2025, and approximately 12% of consolidated operating revenues for the three months ended March 31, 2026. The Customer is concentrated in the Omni Logistics segment. While these discussions did not result in a triggering event for impairment of the Company's reporting units during the three months ended March 31, 2026, there is no certainty that there will not be a triggering event in future periods. If such a triggering event were to occur, any potential decline in operating results and cash flows may result in an impairment of goodwill and other intangible assets in future periods.
TheWe Company remainsremain focused on delivering industry leading solutions and service to all of itsour global customer base and believesbelieve that continued execution of itsour strategy will allow itus to regain market share over time.
Results from Operations — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025
Results from Operations
The following table sets forth our consolidated financial data for the three months ended March 31, 2026 and 2025 (unaudited and in thousands):
Operating revenues decreasedincreased $31,235,$54.2 million, or 5.1%,8.8%, to $582,046$673.0 million for the three months ended MarchJune 31,30, 2026 compared to $613,281$618.8 million for the three months ended MarchJune 31,30, 2025. The decreaseincrease was primarily associated with thean Omniincrease Logistics'in groundtonnage operationsshipped and Intermodalrevenue revenue.per hundredweight in our Expedited Freight segment. The results for our reportable segments are discussed in detail in the following sections.below.
Operating expenses decreased $46,913, or 7.7%, to $561,605 for the three months ended March 31, 2026 compared to $608,518 for the three months ended March 31, 2025. The decrease was primarily due to lower salaries, wages and employee benefits and purchased transportation as a result of decreased revenue.
Income from Operations
IncomeOperating from operationsexpenses increased $15,678,$275.0 million, or 329.2%,45.9%, to income$874.3 of $20,441million for the three months ended MarchJune 31,30, 2026 compared to income$599.3 of $4,763million for the three months ended MarchJune 31,30, 2025. The increase was primarily due to effectivethe management$244.0 ofmillion operatinggoodwill expensesimpairment incharge associated with our Omni Logistics segment and cost increases associated with the currenthigher freightrevenues. businessRefer environmentto Note 5—Goodwill and anOther $11,112Intangible reductionAssets infor transactionadditional and acquisition costs.information.
Operating (Loss) Income
Operating loss was $201.3 million for the three months ended June 30, 2026 compared to operating income of $19.5 million for the three months ended June 30, 2025. The change in operating loss was primarily due to the $244.0 million goodwill impairment charge associated with our Omni Logistics segment, partially offset by profit improvement due to increased revenues in our Expedited Freight segment.
Total other expense increaseddecreased $12,481,$13.9 million, or 26.9%,24.6%, to expense of $58,846$42.7 million for the three months ended MarchJune 31,30, 2026 compared to an expense of $46,365$56.6 million for the three months ended MarchJune 31,30, 2025. The increasedecrease in total other expense was primarily due to a $16,707$1.2 million adjustment to decrease liabilities under the Tax Receivable Agreement in the three months ended June 30, 2026 compared to a $6.9 million adjustment to increase liabilities under the Tax Receivable Agreement.Agreement in the prior period. Additionally, foreign currency exchange decreased by $4.1 million. These decreases were partially offset by a gain of $3.6 million on the sale of a business unit within our Omni Logistics segment during the three months ended June 30, 2026.
The effective tax rate for the three months ended MarchJune 31,30, 2026 was (4.7)%0.1% compared to (47.1)%55.4% for the three months ended MarchJune 31,30, 2025. The effective tax rate for the three months ended MarchJune 31,30, 2026 and 2025 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of interest expense disallowances under IRC Section 163(j) for which a full valuation allowance was recorded on the deferred tax asset, noncontrolling interest, and foreign, state and local income taxes. Additionally, the effective tax rate for the three months ended June 30, 2026 varied from the statutory United States federal income tax rate of 21.0% due to the tax effects of the goodwill impairment and related change in the valuation allowance.
Net Loss Attributable to Noncontrolling Interest
The Company is organized as an umbrella partnership C Corporation. Net losses are allocated to noncontrolling interest holders based on the percentage ownership in Clue Opco LLC (“Opco”) of the Class B shareholders. Approximately 15.7% of consolidated net losses were attributed to noncontrolling interest for the three months ended June 30, 2026 compared to 38.2% for the three months ended June 30, 2025. The decrease in the percentage is due to exchanges of Class B shares to common stock from June 30, 2025 through June 30, 2026 and net losses for Forward Air Corporation, which are not allocated to noncontrolling interest and consist primarily of changes in the value of the Tax Receivable Agreement and the impact of income tax expense.
Net Loss
As a result of the foregoing factors, net loss improved by $20,993, to $40,198 for the three months ended March 31, 2026 compared to $61,191 net loss for the three months ended March 31, 2025.
Expedited Freight -— Three Months Ended MarchJune 31,30, 2026 compared to Three Months Ended MarchJune 31,30, 2025
(1)Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue.
The following table sets forth the financialoperating datastatistics of our Expedited Freight segment for the three months ended March 31, 2026 and 2025 (unaudited and in thousands):
(1)Excludes accessorial and Truckload products.
(2)Includes intercompany revenue between the Network and Truckload revenue streams.
Operating revenues increased $61.4 million, or 23.8%, to $319.1 million for the three months ended June 30, 2026 from $257.7 million for the three months ended June 30, 2025. The increase was primarily due to increased Network revenues reflecting a 6.7% increase in tonnage and a 9.3% increase in revenue per hundredweight as compared to the same period in 2025. The increase in tonnage reflects an increase in shipments per day of 1.7% and an increase in weight per shipment of 5.3%. The increase in shipments is due to stronger demand for our services as industry capacity tightens. The increase in Truckload revenues resulted from an increase of $17.2 million in intersegment revenues with Omni Logistics' Ground operations and $9.5 million in operating revenues from the conversion of certain customers previously serviced by Omni Logistics in the prior year period.
Operating revenues increased $23,326, or 9.4%, to $272,707 for the three months ended March 31, 2026 from $249,381 for the three months ended March 31, 2025. The increase was primarily due to increased Truckload revenue that resulted from a $19,976 increase in intersegment revenues with Omni Logistics' ground operations and $7,242 in operating revenues from the conversion of certain customers previously serviced by Omni Logistics in the prior year period. Network revenue decreased due to a 2.0% decrease in pounds per day, partially offset by a 0.8% increase in revenue per hundred weight as compared to the same period in 2025. The decrease in tonnage reflects fewer shipments per day of 4.3% that is partially offset by an increase in weight per shipment of 3.2%. The decrease in shipments is due to softer demand for our services.
Purchased Transportation
Purchased transportation increased $21,003,$43.5 million, or 17.4%,34.9%, to $141,683$167.9 million for the three months ended MarchJune 31,30, 2026 from $120,680$124.4 million for the three months ended MarchJune 31,30, 2025. Purchased transportation was 52.0%52.6% of Expedited Freight operating revenues for the three months ended MarchJune 31,30, 2026 compared to 48.4%48.3% for the same period in 2025. Expedited Freight purchasedPurchased transportation includes Leased Capacity Providers and third-party motor carriers and transportation intermediaries, while Company-employed drivers are included in salaries, wages and employee benefits. Purchased transportation primarily increased in correlation with the increase in intersegment revenues withperiod Omni'sover ground operationsperiod, and the conversionmix of certainrevenue customersbetween previouslyNetwork servicedand byTruckload Omniwhere LogisticsTruckload inrequires theadditional prioramounts yearof period.purchased transportation.
Salaries, wages and employee benefits increased $3,073,$3.6 million, or 5.8%,6.7%, to $55,650$57.6 million for the three months ended MarchJune 31,30, 2026 from $52,577$53.9 million for the three months ended MarchJune 31,30, 2025. Salaries, wages and employee benefits were 20.4%18.0% of Expedited Freight operating revenues for the three months ended MarchJune 31,30, 2026 compared to 21.1%20.9% for the same period in 2025. The increase in salaries, wages and employee benefits expense was primarily due to the intersegmental6.7% shiftincrease ofin personneltonnage formoved supportingperiod theover Truckload operations.period.
Omni Logistics -— Three Months Ended MarchJune 31,30, 2026 compared to Three Months Ended MarchJune 31,30, 2025
Operating revenues increased $10.2 million, or 3.1%, to $338.5 million for the three months ended June 30, 2026 from $328.3 million for the three months ended June 30, 2025. This was due to an increase in Contract Logistics and Air and Ocean services, partially offset by the decrease in Ground services. Contract Logistics and Air and Ocean services increased due to an increase in demand from our customers. Ground services during the three months ended June 30, 2026 decreased primarily due to the conversion of certain customers to Expedited Freight that were previously serviced by Omni Logistics in the prior period, as discussed above in the Expedited Freight segment section.
The following table sets forth the financial data of our Omni Logistics segment for the three months ended March 31, 2026 and 2025 (unaudited and in thousands):
Operating revenues decreased $21,052, or 6.5%, to $302,418 for the three months ended March 31, 2026 from $323,470 for the same period in 2025. This was due to decreased ground, air and ocean services, which was partially offset by the increase in contract logistics. Ground and air and ocean services have decreased due to softer demand from the segment's customers.
Purchased Transportation
Purchased transportation decreasedincreased $16,811,$5.1 million, or 9.1%,2.8%, to $168,923$190.2 million for the three months ended MarchJune 31,30, 2026 from $185,734$185.0 million for the three months ended MarchJune 31,30, 2025. Purchased transportation was 55.9%56.2% of operating revenues for the three months ended MarchJune 31,30, 2026 compared to 57.4%56.4% for the same period in 2025. ThePurchased decreasetransportation wasincreased primarily driven by a reduction in operatingcorrelation revenuewith and a favorable shift in product mix. This shift included anthe increase in contractrevenues logistics,period whichover generally require lower levels of purchase transportation compared to ground, air, and ocean services.period.
Other operating expenses decreased $4.2 million, or 17.2%, to $20.1 million for the three months ended June 30, 2026 from $24.3 million for the three months ended June 30, 2025. Other operating expenses were 5.9% of operating revenues for the three months ended June 30, 2026 compared to 7.4% for the same period in 2025. Other operating expenses primarily decreased as a result of cost reduction efforts initiated by the Company beginning in 2025.
Impairment of Goodwill
During the three months ended June 30, 2026, we recorded a $244.0 million goodwill impairment charge as a result of the anticipated decrease in future revenues from the Customer, together with a sustained decrease in our stock price. There were no impairment charges during the three months ended June 30, 2025. Refer to Note 5—Goodwill and Other Intangible Assets for additional information.
FWRD insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-06-18 | Svindland Paul C. |
Grant/award | 9,545 | — | — |
| 2026-06-18 | Boyles Dale W |
Grant/award | 9,545 | — | — |
| 2026-06-18 | Gorjanc Christine Marie |
Grant/award | 9,545 | — | — |
| 2026-04-29 | Stewart Shawn |
Shares withheld for tax | 4,136 | $21.51 | $89.0K |
Well-known investors holding FWRD (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| D. E. Shaw & Co. | 2026-06-30 | 1,000,105 | $13.5M | 0.01% | New position |
| Millennium Management (Israel Englander) | 2026-06-30 | 422,193 | $5.7M | 0.0% | Added 310% |
| Renaissance Technologies | 2026-06-30 | 190,739 | $2.6M | 0.0% | Reduced 10% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 186,574 | $2.5M | 0.0% | Reduced 55% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 149,756 | $2.0M | 0.0% | Added 174% |
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 46,555 | $777.9K | — | Sold out |
| Two Sigma Investments | 2026-06-30 | 53,537 | $723.3K | 0.0% | New position |