Werner Enterprises — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenues reached $950.5 million, a 23% increase year-over-year (YoY) compared to $771.5 million in Q3 2025.
• Operating income was $17.0 million, a turnaround from an operating loss of $13.0 million in Q3 2025; operating margin improved to 1.8% from (1.7)%.
• Non-GAAP adjusted operating income was $21.0 million, a 92% increase YoY; non-GAAP adjusted operating margin was 2.2%, up 80 basis points from 1.4%.
• Net income attributable to Werner was $6.6 million compared to a net loss of $20.6 million in Q3 2025.
• Diluted earnings per share (EPS) were $0.11 compared to a loss of $0.34 per share in Q3 2025.
• Non-GAAP adjusted diluted EPS was $0.16 compared to a loss of $0.03 per share in Q3 2025.
• Net interest expense increased $1.0 million to $9.5 million, driven by higher average debt outstanding.
• Cash flow from operations was $21.5 million, down 51% from $44.1 million in Q3 2025.
• Net capital expenditures were $37.3 million in Q3 2026 compared to $35.2 million in Q3 2025.
• Gains on sales of property and equipment were $8.0 million in Q3 2026 compared to $4.5 million in Q3 2025.
• Total debt outstanding, including finance lease liabilities, was $847.4 million as of September 30, 2026.
• Stockholders' equity was $1.4 billion as of September 30, 2026.

Guidance and Future Outlook:

• Updated 2026 guidance for TTS average truck count growth is 16% to 17% (previously 16% to 18%).
• Updated 2026 guidance for Dedicated RPTPW growth is 4% to 5% (previously 3% to 5%).
• Updated 2026 guidance for One-Way Truckload RPTM growth is 10% to 13% (previously 10% to 13% for Q3, now applied to Q4).
• Updated 2026 guidance for net capital expenditures is $190 million to $205 million (previously $215 million to $250 million).
• Updated 2026 guidance for effective income tax rate (GAAP) is 24.5% to 25.5% (previously 25.5% to 26.5%).
• Management anticipates accelerating tractor purchases in the fourth quarter of 2026 to further reduce fleet age.
• Management expressed confidence in the trajectory to capitalize on the early stages of a freight upcycle.

Business Segments and Product Lines:

• Truckload Transportation Services (TTS): Revenues increased 37% YoY to $714.0 million. Operating income turned to $23.2 million from a loss of $13.8 million. Non-GAAP adjusted operating income rose 172% to $24.3 million.
  • Dedicated unit trucks totaled 7,090 at quarter-end (81% of TTS fleet), up from 4,965 a year ago.
  • One-Way Truckload average revenues per truck per week increased 34.3% YoY.
  • The segment benefited from the acquisition of FirstFleet (acquired January 27, 2026), which contributed to a 43.8% YoY increase in Dedicated average trucks.
• Werner Logistics: Revenues decreased 7% YoY to $215.8 million. Operating loss was $0.4 million compared to $3.0 million income in Q3 2025. Non-GAAP adjusted operating income decreased 82% to $0.8 million.
  • Truckload Logistics Brokerage revenues decreased 13% due to a 40% drop in shipments, partially offset by a 44% increase in revenue per shipment.
  • Intermodal revenues increased 7% due to higher revenue per shipment and shipments.
  • Final Mile revenues increased 18% YoY.
• Corporate and Other: Operating loss was $5.9 million, driven primarily by acquisition expenses.

Market and Competitive Landscape:

• Industry capacity is tightening, prompting accelerated investments in driver recruiting and onboarding.
• The company is capitalizing on rising customer demand during the early stages of a freight upcycle.
• Rapidly rising fuel costs and elevated claims temporarily impacted near-term margins.
• One-Way Truckload restructuring efforts earlier in the year contributed to total miles per truck production gains of 22.4%.

Risks and Challenges:

• Rising fuel costs and elevated claims expenses are impacting margins.
• Acquisition expenses and integration costs are affecting Corporate and Other segment results.
• The company faces risks associated with industry capacity constraints and the need to recruit and onboard drivers.
• Litigation settlement costs of $21.4 million recorded in Q3 2025 did not recur in Q3 2026, providing a favorable comparison.

Management Commentary and Tone:

• Chairman and CEO Derek Leathers stated that results demonstrate "strong top-line momentum" with double-digit TTS revenue per truck growth.
• Management noted that the underlying strategy is working, driving a near-doubling of adjusted operating income.
• The tone was confident regarding the ability to capitalize on the freight upcycle despite temporary margin pressures.

Other Key Points:

• Acquisition: FirstFleet was acquired on January 27, 2026, generating over $600 million in unaudited 2025 revenues.
• Debt Refinancing: On October 5, 2026, the company entered into a new $1.1 billion unsecured credit facility, terminating the existing $1.075 billion facility. $465 million was borrowed under the new agreement to pay off the old facility.
• Share Repurchases: No shares were repurchased in Q3 2026; 5.0 million shares remain under the authorization.
• Fleet Age: Average truck age was 2.8 years and average trailer age was 6.5 years as of September 30, 2026.
• Liquidity: Available liquidity was $654.3 million as of September 30, 2026, and $603.1 million as of October 5, 2026, after the credit facility change.
• Litigation: A $18.0 million class action lawsuit settlement was fully accrued in Q3 2025 and distributed in Q3 2026 following court approval.