FORWARD AIR CORP 10-Q

Item 1. Financial Statements Forward Air Corporation Condensed Consolidated Balance Sheets (unaudited and in thousands, except per share amounts) June 30, 2026 December 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 139,448 $ 105,996 Accounts receivable, less allowance of $ 5,369 in 2026 and $ 3,749 in 2025 369,469 343,559 Other receivables 6,104 6,147 Prepaid expenses 26,465 28,045 Other current assets 41,630 37,254 Total current assets 583,116 521,001 Property and equipment, net of accumulated depreciation and amortization of $ 352,920 in 2026 and $ 340,021 in 2025 274,670 297,882 Operating lease right-of-use assets 361,426 412,535 Goodwill 278,706 522,712 Other intangible assets, net of accumulated amortization of $ 346,229 in 2026 and $ 301,453 in 2025 860,915 906,791 Other long-term assets 52,012 58,023 Total assets $ 2,410,845 $ 2,718,944 LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY Current liabilities: Accounts payable $ 118,651 $ 121,752 Accrued expenses 118,551 114,422 Other current liabilities 81,911 69,130 Current portion of finance lease obligations 14,961 15,995 Current portion of operating lease liabilities 107,497 107,026 Total current liabilities 441,571 428,325 Long-term debt 1,693,340 1,687,248 Liabilities under Tax Receivable Agreement 26,794 11,548 Finance lease obligations, less current portion 16,804 22,387 Operating lease liabilities, less current portion 277,379 327,011 Deferred income taxes 24,358 27,221 Other long-term liabilities 53,265 53,540 Total liabilities 2,533,511 2,557,280 Shareholders' (deficit) equity: Preferred stock, $ 0.01 par value; 5,000 shares authorized; no shares issued or outstanding as of June 30, 2026 and December 31, 2025 — — Series B preferred stock, $ 0.01 par value; 15 shares authorized; 7 and 9 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively — — Common stock, $ 0.01 par value; 50,000 shares authorized; 33,736 and 31,327 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively 337 313 Additional paid-in capital 575,818 559,551 Accumulated deficit ( 690,324 ) ( 447,100 ) Accumulated other comprehensive income ( 1,261 ) 580 Total Forward Air shareholders' (deficit) equity ( 115,430 ) 113,344 Noncontrolling interest ( 7,236 ) 48,320 Total shareholders' (deficit) equity ( 122,666 ) 161,664 Total liabilities and shareholders' (deficit) equity $ 2,410,845 $ 2,718,944 The accompanying notes are an integral part of the condensed consolidated financial statements. 2 Table of Contents Forward Air Corporation Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited and in thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Operating revenues $ 673,036 $ 618,844 $ 1,255,082 $ 1,232,125 Operating expenses: Purchased transportation 335,892 303,300 619,669 607,562 Salaries, wages and employee benefits 130,040 145,490 245,616 287,405 Operating leases 50,252 49,505 99,965 98,298 Depreciation and amortization 38,262 36,806 76,783 74,166 Insurance and claims 13,678 15,536 27,176 30,542 Fuel expense 6,644 5,278 11,571 10,927 Other operating expenses 55,574 43,407 111,167 98,940 Impairment of goodwill 244,006 — 244,006 — Total operating expenses 874,348 599,322 1,435,953 1,207,840 Operating (loss) income ( 201,312 ) 19,522 ( 180,871 ) 24,285 Other income and expenses: Interest expense, net ( 43,721 ) ( 45,326 ) ( 87,308 ) ( 90,873 ) Foreign exchange (loss) gain ( 566 ) ( 4,653 ) 1,132 ( 5,575 ) Other income (expense), net 1,569 ( 6,656 ) ( 15,388 ) ( 6,552 ) Total other expense ( 42,718 ) ( 56,635 ) ( 101,564 ) ( 103,000 ) Loss from continuing operations before income taxes ( 244,030 ) ( 37,113 ) ( 282,435 ) ( 78,715 ) Income tax (benefit) expense ( 174 ) ( 16,749 ) 1,619 2,840 Loss from continuing operations ( 243,856 ) ( 20,364 ) ( 284,054 ) ( 81,555 ) Loss from discontinued operations, net of tax ( 2,075 ) — ( 2,075 ) — Net loss ( 245,931 ) ( 20,364 ) ( 286,129 ) ( 81,555 ) Net loss attributable to noncontrolling interest ( 38,631 ) ( 7,781 ) ( 44,510 ) ( 18,335 ) Net loss attributable to Forward Air $ ( 207,300 ) $ ( 12,583 ) $ ( 241,619 ) $ ( 63,220 ) Basic and diluted net loss per share attributable to Forward Air: Continuing operations $ ( 6.33 ) $ ( 0.41 ) $ ( 7.49 ) $ ( 2.09 ) Discontinued operations ( 0.05 ) — ( 0.05 ) — Net loss per basic and diluted share $ ( 6.38 ) $ ( 0.41 ) $ ( 7.54 ) $ ( 2.09 ) Net loss $ ( 245,931 ) $ ( 20,364 ) $ ( 286,129 ) $ ( 81,555 ) Other comprehensive loss: Foreign currency translation adjustments ( 135 ) 4,561 ( 2,181 ) 4,826 Comprehensive loss ( 246,066 ) ( 15,803 ) ( 288,310 ) ( 76,729 ) Comprehensive loss attributable to noncontrolling interest ( 38,535 ) ( 7,781 ) ( 44,850 ) ( 18,335 ) Comprehensive loss attributable to Forward Air $ ( 207,531 ) $ ( 8,022 ) $ ( 243,460 ) $ ( 58,394 ) The accompanying notes are an integral part of the condensed consolidated financial statements. 3 Table of Contents Forward Air Corporation Condensed Consolidated Statements of Cash Flows (unaudited and in thousands) Six Months Ended June 30, 2026 2025 OPERATING ACTIVITIES: Net loss $ ( 286,129 ) $ ( 81,555 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 76,783 74,166 Impairment of goodwill 244,006 — Share-based compensation expense 4,032 7,669 Change in Tax Receivable Agreement liability 15,488 6,864 Deferred income tax benefit ( 2,774 ) ( 4,725 ) Non-cash interest expense 7,227 6,846 Gain on sale of business ( 3,649 ) — Other 4,191 2,399 Changes in operating assets and liabilities: Accounts receivable ( 36,020 ) ( 16,945 ) Other receivables ( 499 ) 309 Other current and noncurrent assets 932 9,719 Accounts payable, accrued expenses and other current liabilities 17,267 9,651 Net cash provided by operating activities 40,855 14,398 INVESTING ACTIVITIES: Proceeds from sale of property and equipment 2,553 1,495 Purchases of property and equipment ( 10,159 ) ( 16,650 ) Proceeds from sale of business, net 8,739 — Other — 31 Net cash provided by (used in) investing activities 1,133 ( 15,124 ) FINANCING ACTIVITIES: Repayments of finance lease obligations ( 8,374 ) ( 9,376 ) Proceeds from borrowings under credit facility — 85,000 Repayments of borrowings under credit facility — ( 85,000 ) Proceeds from common stock issued under employee stock purchase plan 734 434 Payment of minimum tax withholdings on share-based awards and other ( 805 ) ( 1,001 ) Net cash used in financing activities ( 8,445 ) ( 9,943 ) Effect of exchange rate changes on cash ( 91 ) 710 NET CHANGE IN CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS 33,452 ( 9,959 ) Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period 105,996 105,266 Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period $ 139,448 $ 95,307 Reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents Cash and cash equivalents $ 139,448 $ 95,128 Restricted cash and restricted cash equivalents — 179 Total cash, cash equivalents, restricted cash and restricted cash equivalents $ 139,448 $ 95,307 The accompanying notes are an integral part of the condensed consolidated financial statements. 4 Table of Contents Forward Air Corporation Condensed Consolidated Statements of Shareholders' (Deficit) Equity (unaudited and in thousands) Common Stock Preferred Stock - Class B Amount Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Non-controlling Interest Total Shares Amount Shares Amount Balance at December 31, 2025 31,327 $ 313 9 $ — $ 559,551 $ 580 $ ( 447,100 ) $ 48,320 $ 161,664 Net loss — — — — — — ( 34,319 ) ( 5,879 ) ( 40,198 ) Foreign currency translation adjustments — — — — — ( 1,610 ) — ( 436 ) ( 2,046 ) Issuance of share-based awards 191 2 — — ( 2 ) — — — — Payment of minimum tax withholdings on share-based awards and other ( 53 ) — — — 807 — ( 1,492 ) — ( 685 ) Series B conversions 133 1 — — 729 — — ( 730 ) — Share-based compensation expense — — — — 3,541 — — — 3,541 Balance at March 31, 2026 31,598 $ 316 9 $ — $ 564,626 $ ( 1,030 ) $ ( 482,911 ) $ 41,275 $ 122,276 Net loss — — — — — — ( 207,300 ) ( 38,631 ) ( 245,931 ) Foreign currency translation adjustments — — — — — ( 231 ) — 96 ( 135 ) Issuance of share-based awards 55 — — — — — — — — Payment of minimum tax withholdings on share-based awards and other ( 5 ) — — — 12 — ( 113 ) — ( 101 ) Series B conversions 2,059 21 ( 2 ) — 9,955 — — ( 9,976 ) — Common stock issued under employee stock purchase plan 29 — — — 734 — — — 734 Share-based compensation expense — — — — 491 — — — 491 Balance at June 30, 2026 33,736 $ 337 7 $ — $ 575,818 $ ( 1,261 ) $ ( 690,324 ) $ ( 7,236 ) $ ( 122,666 ) The accompanying notes are an integral part of the condensed consolidated financial statements. 5 Table of Contents Forward Air Corporation Condensed Consolidated Statements of Shareholders' (Deficit) Equity (continued) (unaudited and in thousands) Common Stock Preferred Stock - Class B Amount Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Retained (Deficit) Earnings Non-controlling Interest Total Shares Amount Shares Amount Balance at December 31, 2024 29,761 $ 298 10 $ — $ 542,392 $ ( 2,732 ) $ ( 338,230 ) $ 84,140 $ 285,868 Net loss — — — — — — ( 50,637 ) ( 10,554 ) ( 61,191 ) Foreign currency translation adjustments — — — — — 265 — — 265 Issuance of share-based awards 97 — — — — — — — — Payment of minimum tax withholdings on share-based awards ( 30 ) — — — — — ( 894 ) — ( 894 ) Series B conversions 585 6 ( 1 ) — 1,208 — — ( 1,214 ) — Share-based compensation expense — — — — 2,958 — — — 2,958 Balance at March 31, 2025 30,413 $ 304 9 $ — $ 546,558 $ ( 2,467 ) $ ( 389,761 ) $ 72,372 $ 227,006 Net loss — — — — — — ( 12,583 ) ( 7,781 ) ( 20,364 ) Foreign currency translation adjustments — — — — — 4,561 — — 4,561 Issuance of share-based awards 99 — — — — — — — — Payment of minimum tax withholdings on share-based awards ( 2 ) — — — — — ( 107 ) — ( 107 ) Series B conversions 80 1 — — 143 — — ( 144 ) — Common stock issued under employee stock purchase plan 17 1 — — 433 — — — 434 Share-based compensation expense — — — — 4,711 — — — 4,711 Balance at June 30, 2025 30,607 $ 306 9 $ — $ 551,845 $ 2,094 $ ( 402,451 ) $ 64,447 $ 216,241 The accompanying notes are an integral part of the condensed consolidated financial statements. 6 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 1 — Organization and Basis of Presentation Forward Air Corporation and its subsidiaries (the “Company,” “Forward Air,” “we,” “our,” or “us”) is a leading asset-light freight and logistics company. The Company has three reportable segments: Expedited Freight, Omni Logistics and Intermodal. The Company conducts business in North and South America, Europe, and Asia. The Expedited Freight segment provides expedited regional, inter-regional and national less-than-truckload (“LTL”) and truckload services in the United States. Expedited Freight also offers customers local pick-up and delivery and other services including shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling services. The Omni Logistics segment provides a full suite of global logistics services. Services include air and ocean freight consolidation and forwarding, customs brokerage, warehousing and distribution, value-added services, time-definite transportation services and other supply chain solutions. Omni Newco LLC (“Omni”) was acquired in January 2024 (the “Omni Acquisition”). The Intermodal segment provides first- and last-mile high value intermodal container drayage services both to and from seaports and railheads in the United States. Intermodal also offers dedicated contract and container freight station warehouse and handling services. Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature necessary to present fairly the Company’s financial position, results of operations, and cash flows for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Results for interim periods are not necessarily indicative of the results for the year. Certain immaterial prior period amounts have been reclassified to conform to current period presentation. These changes did not have a material impact on our financial position or results of operations. Note 2 — Indebtedness Long-term debt consisted of the following: June 30, 2026 December 31, 2025 Term Loan, expiring 2030 $ 1,045,000 $ 1,045,000 Senior Secured Notes, maturing 2031 725,000 725,000 Less: unamortized discount and debt issuance costs ( 76,660 ) ( 82,752 ) Total long-term debt $ 1,693,340 $ 1,687,248 The Term Loan is part of our Credit Agreement with Citibank, N.A., and includes a revolving credit facility. As of June 30, 2026, the revolving credit facility had $ 261 million of borrowings available and no borrowings outstanding. The Company was in compliance with all covenants required by the Credit Agreement as of June 30, 2026. Note 3 — Net Loss Per Share Basic net loss per common share is computed by dividing net loss attributable to Forward Air by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share assumes the exercise of outstanding stock options and the vesting of performance share awards using the treasury stock method when the effects of such assumptions are dilutive. 7 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) The Company's unvested restricted shares contain non-forfeitable rights to dividends and are therefore considered participating securities. As such, the Company computes net loss per share using the two-class method. The two-class method is an earnings allocation formula that determines net income (loss) per share for each class of common stock and participating security according to dividends declared (or accumulated) and their respective participation rights in undistributed earnings. However, because the participating securities do not have a contractual obligation to share in the losses of the Company, no losses were allocated to these securities in the calculation of net loss per share for the periods presented. A reconciliation of net loss attributable to Forward Air and weighted-average common shares outstanding for purposes of calculating basic and diluted net loss per share is as follows: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Numerator: Loss from continuing operations $ ( 243,856 ) $ ( 20,364 ) $ ( 284,054 ) $ ( 81,555 ) Less: Net loss from continuing operations attributable to noncontrolling interest ( 38,289 ) ( 7,781 ) ( 44,168 ) ( 18,335 ) Loss from continuing operations attributable to Forward Air ( 205,567 ) ( 12,583 ) ( 239,886 ) ( 63,220 ) Loss from discontinued operations, net of tax $ ( 2,075 ) $ — $ ( 2,075 ) $ — Less: Net loss from discontinued operations attributable to noncontrolling interest ( 342 ) — ( 342 ) — Loss from discontinued operations attributable to Forward Air ( 1,733 ) — ( 1,733 ) — Net loss attributable to Forward Air $ ( 207,300 ) $ ( 12,583 ) ( 241,619 ) ( 63,220 ) Denominator: Denominator for basic and diluted net loss per share—weighted-average number of common shares outstanding 32,481 30,429 32,043 30,319 Basic and diluted net loss per share attributable to Forward Air: Continuing operations $ ( 6.33 ) $ ( 0.41 ) $ ( 7.49 ) $ ( 2.09 ) Discontinued operations ( 0.05 ) — ( 0.05 ) — Net loss per basic and diluted share $ ( 6.38 ) $ ( 0.41 ) $ ( 7.54 ) $ ( 2.09 ) The following securities were excluded from the calculation of loss per share as their impact would be anti-dilutive: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Stock options 21 32 21 32 Performance shares 516 113 516 83 Restricted shares 737 496 737 319 Total anti-dilutive securities 1,274 641 1,274 434 8 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 4 — Income Taxes The Company is taxed as a C Corporation and is subject to federal and state income taxes. Forward Air Corporation’s sole material tax asset is Clue Opco, LLC (“Opco”), which is a limited liability company that is taxed as a partnership for federal and certain state and local income tax purposes. Opco’s net taxable income and related tax credits, if any, are passed through to its partners and included in the partner’s tax returns. The income tax burden on the earnings or losses taxed to the noncontrolling interest holders is not reported by the Company in its condensed consolidated financial statements. As a result, the Company's effective tax rate differs materially from the statutory rate. The Company recorded an income tax benefit of $ 174 and $ 16,749 for the three months ended June 30, 2026 and 2025, respectively, and income tax expense of $ 1,619 and $ 2,840 for the six months ended June 30, 2026 and 2025, respectively. The effective tax rate of 0.1 % and 55.4 % for the three months ended June 30, 2026 and 2025, respectively, and ( 0.6 )% and ( 3.6 )% for the six months ended June 30, 2026 and 2025, respectively, 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 state and local income taxes. Additionally, the effective tax rate for the three and six 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. In connection with the Omni Acquisition, the Company entered into a Tax Receivable Agreement with certain Omni Holders. As of June 30, 2026 and December 31, 2025, the Company has recorded a Tax Receivable Agreement liability of $ 12,057 and $ 10,580 , respectively, related to contingent consideration. The Company recorded a valuation allowance against any deferred tax assets associated with tax benefits generated in conjunction with and subsequent to the acquisition which are subject to the Tax Receivable Agreement. The Company subsequently concluded additional Tax Receivable Agreement payments related to the year ended December 31, 2025 would be probable based on estimates of future taxable income over the term of the Tax Receivable Agreement and recorded a payable of $ 968 . For the period ended June 30, 2026, the Company updated this estimate to a total estimated payable of $ 14,953 that is payable based on the 2025 taxable income and 2026 estimated taxable income. The $ 15,488 charge to increase the Tax Receivable Agreement liability is recorded in Other income (expense), net in the condensed consolidated statement of operations and comprehensive loss. If other tax attributes subject to the Tax Receivable Agreement are determined to be payable, additional Tax Receivable Agreement liabilities may be considered probable at that time. The determination of the Tax Receivable Agreement liability requires the Company to make judgments in estimating the amount of tax attributes as of the date of exchanges (such as cash to be received by the Company on a hypothetical sale of assets and allocation of gain or loss to the Company at the time of the exchanges taking into consideration partnership tax rules). The amounts payable under the Tax Receivable Agreement will also vary depending upon a number of factors, including tax rates in effect, as well as the amount, character, and timing of the taxable income in the future and the expected realization of tax benefits with respect to deferred tax assets related to tax attributes subject to the Tax Receivable Agreement. Furthermore, amounts payable under the Tax Receivable Agreement as a result of a change of control may be substantially in excess of the amounts set forth above due to, among other things, contractual provisions that require any such calculation to assume that all applicable tax benefits are used by the Company over the applicable tax years. The Company also maintains a full valuation allowance against its net deferred tax assets, which are primarily related to interest expense carryforwards. The Company assessed the likelihood that its deferred tax assets would be recovered from estimated future taxable income and available tax planning strategies. In making this assessment, all available evidence was considered including economic climate, as well as reasonable tax planning strategies. The Organization for Economic Co-operation and Development (“OECD”), continues to put forth various initiatives, including Pillar Two rules which include the introduction of a global minimum tax at a rate of 15%. European Union member states agreed to implement the OECD’s Pillar Two rules with effective dates of January 1, 2024 and January 1, 2025, for different aspects of the directive and most have already enacted legislation. A number of other countries are also implementing similar legislation. As of June 30, 2026, based on the countries in which we do business that have enacted legislation effective January 1, 2026, the impact of these rules to our financial statements was not material. This may change as other countries enact similar legislation and further guidance is released. We continue to closely monitor regulatory developments to assess potential impacts to our condensed consolidated financial statements. In general, it is the practice and intention of the Company to reinvest the earnings of its non-U.S. subsidiaries in those operations. As of June 30, 2026, the Company has not recorded a provision for U.S. or additional foreign withholding taxes on investments in foreign subsidiaries that are indefinitely reinvested. Generally, such amounts become subject to U.S. taxation upon the remittance of dividends and under certain other circumstances. 9 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 5 — Goodwill and Other Intangible Assets The Company has historically performed its annual goodwill impairment test as of June 30 and on an interim basis when events or circumstances indicate that the fair value of a reporting unit may be below its carrying value. As disclosed in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, the Company had commenced preliminary discussions with its largest customer (the “Customer”) during the first quarter of 2026 regarding a potential transition of a portion of the Customer’s contract logistics business to other suppliers. Based on the preliminary status of those discussions and the other facts and circumstances then known to management, the Company concluded that no triggering event had occurred with respect to any of its reporting units as of March 31, 2026. During the second quarter of 2026, these discussions progressed and the Company and the Customer engaged in more advanced negotiations regarding the potential transition of a portion of the Customer's contract logistics business to other suppliers for reasons related to the Customer's operations and supplier diversification initiatives. As a result of these continued discussions, the Company was, for the first time, able to reasonably estimate the scope and timing of the potential transition. 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. In addition, the Company's stock price decreased significantly in May 2026 and remained at decreased levels throughout the month of May. Subsequent to the measurement date, the Company received additional clarity and currently expects to retain a majority of the Customer’s business. Based on the anticipated decrease in future revenues from the Customer, together with a sustained decrease in the Company's stock price since early May 2026, management determined that a triggering event had occurred during the second quarter of 2026 and performed an interim goodwill impairment test as of May 31, 2026. The Company’s impairment analyses were performed as of May 31, 2026 for all reporting units given the stock price decrease negatively impacts the fair values of all reporting units. The estimated fair values of the Company's reporting units were determined using the discounted cash flow (“DCF”) method and a guideline public company method with the assistance of a third-party valuation specialist engaged by management. Under the DCF method, the fair value of a reporting unit is the present value of estimated future cash flows and is based on all known or knowable information at the measurement date. The inputs to the DCF method include estimates of future cash flows, an estimated growth rate and a discount rate. Under the guideline public company method, the fair value is based upon market multiples derived from publicly-traded companies with similar operating and investment characteristics as the reporting unit. The inputs to both the DCF and guideline public company methods are considered Level 3 valuation inputs. Additionally, the overall valuation considers the Company's market capitalization as of the assessment date, which was lower relative to the previous goodwill impairment test. The estimated fair values for the LTL, Truckload and Intermodal reporting units notably exceeded the respective reporting unit's carrying value; therefore, no impairment charge was required for the goodwill allocated to these reporting units. The LTL and Truckload reporting units operate within the Expedited Freight reportable segment. The Omni Logistics reporting unit’s calculated fair value was less than its carrying value. As a result, the Company recorded a non-cash goodwill impairment charge of $ 244,006 during the three months ended June 30, 2026 in connection with the preparation and review of the condensed consolidated financial statements of the Company as of and for the three months ended June 30, 2026, which reduced the carrying value of the goodwill allocated to the Omni Logistics reporting unit to zero. The goodwill impairment expense is included in Impairment of goodwill on the condensed consolidated statement of operations and comprehensive loss. Additionally, during the second quarter of 2026, the Company made the decision to voluntarily change the date of its annual goodwill impairment assessment from June 30 to October 1 to more closely align the annual goodwill impairment assessment date with the timing of its annual budgeting process. The Company determined the change in measurement date represents an immaterial change in the method of applying an accounting principle and no goodwill impairment assessment was omitted or delayed as a result of the change. During the second quarter of 2026, in connection with the preparation and review of the condensed consolidated financial statements, the Company also performed an impairment test for its long-lived assets, which include property and equipment, net and other intangible assets, net. No impairment charges were identified for long-lived assets for the six months ended June 30, 2026. 10 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Goodwill Goodwill represents the excess of the purchase price over the estimated fair value of the net tangible and identifiable assets acquired in business combinations. Changes in the carrying amount of goodwill are summarized as follows: Expedited Freight Omni Logistics Intermodal Total Balance as of December 31, 2025 Goodwill $ 167,406 $ 1,272,403 $ 136,986 $ 1,576,795 Accumulated impairment charges (1) ( 25,686 ) ( 1,028,397 ) — ( 1,054,083 ) Reported goodwill as of December 31, 2025 141,720 244,006 136,986 522,712 Impairment — ( 244,006 ) — ( 244,006 ) Balance as of June 30, 2026 Goodwill $ 167,406 $ 1,272,403 $ 136,986 $ 1,576,795 Accumulated impairment charges ( 25,686 ) ( 1,272,403 ) — ( 1,298,089 ) Reported goodwill as of June 30, 2026 $ 141,720 $ — $ 136,986 $ 278,706 (1) The Expedited Freight and Omni Logistics impairments were recorded during 2016 and 2024, respectively. Other Intangible Assets, Net Changes in the carrying amount of other intangible assets, net are summarized as follows: June 30, 2026 Gross Carrying Amount Accumulated Amortization Other Intangible Assets, Net Customer Relationships $ 1,157,714 $ ( 314,652 ) $ 843,062 Non-Compete Agreements 25,930 ( 19,508 ) 6,422 Trade Names 23,500 ( 12,069 ) 11,431 Total other intangible assets, net $ 1,207,144 $ ( 346,229 ) $ 860,915 December 31, 2025 Gross Carrying Amount Accumulated Amortization Other Intangible Assets, Net Customer Relationships $ 1,157,714 $ ( 274,408 ) $ 883,306 Non-Compete Agreements 25,930 ( 16,690 ) 9,240 Trade Names 24,600 ( 10,355 ) 14,245 Total other intangible assets, net $ 1,208,244 $ ( 301,453 ) $ 906,791 Amortization expense related to other intangible assets was $ 22,588 and $ 45,358 for the three and six months ended June 30, 2026, respectively, and $ 23,104 and $ 46,209 for the three and six months ended June 30, 2025, respectively. In January 2025, the Board of Directors (the “Board”) announced that it had initiated a comprehensive review of strategic alternatives to maximize shareholder value. During the second quarter of 2026, the Company completed the sale of a business unit within its Omni Logistics segment as part of these efforts and recognized a $ 3,649 gain on the sale, which is included in Other income (expense), net in the condensed consolidated statement of operations and comprehensive loss. 11 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 6 — Fair Value of Financial Instruments The Company categorizes its assets and liabilities into one of three levels based on the assumptions used in valuing the asset or liability. Fair value estimates of financial assets and liabilities are based on a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. In accordance with this guidance, fair value measurements are classified under the following hierarchy: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations in which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Model-derived valuations in which one or more significant inputs are unobservable. Assets and liabilities measured at fair value on a recurring basis are summarized below: As of June 30, 2026 Level 1 Level 2 Level 3 Total Liabilities under Tax Receivable Agreement $ — $ — $ 12,057 $ 12,057 As of December 31, 2025 Level 1 Level 2 Level 3 Total Liabilities under Tax Receivable Agreement $ — $ — $ 10,580 $ 10,580 A portion of the liabilities under the Tax Receivable Agreement relate to the contingent consideration associated with potential payments to be made for the tax benefits related to the 700 shares of Company common stock issued at the closing of the Omni Acquisition. The contingent consideration was remeasured based on the current expected future tax benefit payments to be made to certain Omni Holders and such remeasurement considered a range of potential payments of zero to $ 24,050 . The carrying values of cash and cash equivalents, accounts receivable, other receivables and accounts payable approximate their fair values due to the immediate or short-term nature of these financial instruments. The Company's long-term debt is recorded at cost. The fair value is estimated using Level 2 inputs based on observable prices of identical instruments in less active markets. The carrying value and fair value of the Company's long-term debt is as follows: June 30, 2026 December 31, 2025 Carrying value $ 1,693,340 $ 1,687,248 Fair value $ 1,689,504 $ 1,813,500 12 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 7 — Commitments and Contingencies Contingencies On September 26, 2023, Rodney Bell, Michael A. Roberts and Theresa Woods (collectively, the “Original Plaintiffs”), three of our shareholders, filed a complaint against the Company and certain of its directors and officers in the Third District Chancery Court (the “Chancery Court”) sitting in Greeneville, Tennessee (the “Shareholder Complaint”). The Shareholder Complaint alleges, among other things, that the Company’s shareholders had the right to vote on certain transactions contemplated by the Merger Agreement and sought an injunction against the consummation of the transactions until a shareholder vote was held. The court initially granted a temporary restraining order enjoining the transactions contemplated by the Merger Agreement from closing but later dissolved it on October 25, 2023. Thereafter, the parties to the Amended Merger Agreement completed the Omni Acquisition. On May 2, 2024, Original Plaintiff Michael Roberts, together with the Cambria County Employees Retirement System (together, “Plaintiffs”) filed a stipulation and proposed order seeking leave of court to file an amended class action complaint seeking damages, among other forms of relief. Upon receiving leave of court, on May 15, 2024, the Plaintiffs filed the amended complaint (“Second Amended Complaint”). Like the earlier Shareholder Complaint (and subsequent amendment), the Second Amended Complaint challenges the directors’ determination not to subject the Omni Acquisition to a shareholder vote and alleges that, in so doing, the Company and certain of its now former directors (collectively, “Defendants,” and together with Plaintiffs, the “Parties”) violated Tennessee corporate law. The Second Amended Complaint further alleges that certain of the Company’s now former directors breached their fiduciary duties to shareholders by depriving them of the right to vote on the Omni Acquisition. Thereafter, on June 14, 2024, Defendants removed the case to the United States District Court for the Eastern District of Tennessee (the “District Court”), Greeneville Division. Plaintiffs filed a motion to remand the case to the Chancery Court, and on March 31, 2025, the District Court granted the motion and remanded the case back to the Chancery Court. On September 12, 2025, the Parties informed the Chancery Court that they had reached an agreement in principle to resolve the Action (the “Settlement”). The entire settlement amount will be funded by the Company's D&O insurers. In exchange, the Plaintiffs and the class (as defined in the agreements memorializing the Settlement) will grant customary releases in favor of Defendants of all of their claims that were or could have been asserted in the Action. On March 6, 2026, the Chancery Court entered a Scheduling Order with Respect to Notice and Settlement Hearing, scheduling a hearing to, among other things, determine whether the Settlement should be approved and the Action dismissed with prejudice. The Settlement Hearing occurred on July 21, 2026. At the conclusion of the hearing, the Chancery Court orally granted Plaintiffs’ Motion for Final Approval of Class Action Settlement and Approval of Plan of Allocation and Plaintiffs’ counsel’s Motion for an Award of Attorneys’ Fees and Expenses, and for Service Awards to Plaintiffs. The Chancery Court advised the parties that a final written order memorializing the oral ruling and dismissing the Action with prejudice is forthcoming. By entering into the Settlement, the Defendants are in no way conceding or admitting liability for any of the claims that were or could have been asserted in the Action. The Defendants expressly have denied and continue to deny each and all of the claims asserted in the Action, and maintain that their conduct was at all times proper, in the best interests of the Company and its stockholders, and in compliance with applicable law. Nevertheless, Defendants have determined to enter into the Settlement solely to put the claims to rest, finally and forever, and to eliminate the uncertainty, risk, costs, and burdens inherent in any litigation, including the Action. Final Mile During the second quarter of 2026, the Company accrued $ 2,075 of expense related to the settlement of outstanding litigation and claims related to the Final Mile business, which was sold in 2023. The expense is presented under the caption Loss from discontinued operations, net of tax in the condensed consolidated statement of operations and comprehensive loss. There was no impact to cash flow during the period ended June 30, 2026. From time to time, the Company is also party to other litigation incidental to and arising in the normal course of its business, most of which involve claims for personal injury and property damage related to the transportation and hauling of freight, or workers’ compensation. The Company accrues for the estimated losses from these and other pending claims when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Based on the knowledge of the facts, the Company believes the resolution of such incidental claims and pending litigation, taking into account existing reserves, will not have a material adverse effect on its business, financial condition or results of operations. However, the results of complex legal proceedings are difficult to predict, and the Company’s view of these matters may change in the future as the litigation and related events unfold. 13 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Note 8 — Segment Reporting Our chief operating decision-maker, who is our Chief Executive Officer, analyzes the results of our business through the following reportable segments: Expedited Freight, Omni Logistics, and Intermodal. Our chief operating decision-maker regularly reviews the operating results and performance of our segments through segment profit to manage operations and make decisions regarding resource allocations. These financial metrics are used to view operating trends, perform analytical comparisons and benchmark performance between periods and to monitor budget-to-actual variances on a monthly basis. Our chief operating decision-maker does not utilize information on segment assets. The accounting policies applied to each segment are the same as those described in the Operations and Summary of Significant Accounting Policies as disclosed in Note 1 to the Annual Report on Form 10-K for the year ended December 31, 2025, except for certain self-insurance loss reserves related to vehicle liability and workers’ compensation. Each segment is allocated an insurance premium and deductible that corresponds to the self-insured retention limit for that particular segment. Any self-insurance loss exposure beyond the deductible allocated to each segment is recorded in Corporate. Within the Omni Logistics segment, Ground operating revenues include domestic freight forwarding and time-definite transportation services; Air and Ocean operating revenues include air and ocean freight consolidation and customs brokerage; and Contract Logistics operating revenues include warehousing and value-added services, and other supply chain solutions. Disaggregated external revenues and results from operations by segment are as follows: Three Months Ended June 30, 2026 Expedited Freight Omni Logistics Intermodal Corporate and Eliminations Total External revenues: Ground $ 275,861 $ 132,854 $ — $ — $ 408,715 Contract Logistics — 112,332 — — 112,332 Air and Ocean — 93,361 — — 93,361 Intermodal — — 58,628 — 58,628 Total external revenues 275,861 338,547 58,628 — 673,036 Intersegment revenues 43,201 — 1,096 ( 44,297 ) — Total consolidated revenues 319,062 338,547 59,724 ( 44,297 ) 673,036 Less: Purchased transportation 167,936 190,166 22,087 ( 44,297 ) 335,892 Salaries, wages and employee benefits 57,568 62,226 13,783 ( 3,537 ) 130,040 Operating leases 16,416 27,466 6,100 270 50,252 Depreciation and amortization 8,495 23,878 3,882 2,007 38,262 Insurance and claims 10,018 276 1,799 1,585 13,678 Fuel expense 3,668 457 2,541 ( 22 ) 6,644 Other operating expenses 20,068 20,082 3,431 11,993 55,574 Impairment of goodwill — 244,006 — — 244,006 Segment profit (loss) $ 34,893 $ ( 230,010 ) $ 6,101 $ ( 12,296 ) $ ( 201,312 ) Interest expense, net ( 43,721 ) Foreign exchange (loss) gain ( 566 ) Other income (expense), net 1,569 Loss from continuing operations before income taxes $ ( 244,030 ) 14 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Three Months Ended June 30, 2025 Expedited Freight Omni Logistics Intermodal Corporate and Eliminations Total External revenues: Ground $ 231,823 $ 155,430 $ — $ ( 142 ) $ 387,111 Contract Logistics — 97,469 — — 97,469 Air and Ocean — 75,417 — — 75,417 Intermodal — — 58,847 — 58,847 Total external revenues 231,823 328,316 58,847 ( 142 ) 618,844 Intersegment revenues 25,873 — 299 ( 26,172 ) — Total consolidated revenues 257,696 328,316 59,146 ( 26,314 ) 618,844 Less: Purchased transportation 124,448 185,040 20,049 ( 26,237 ) 303,300 Salaries, wages and employee benefits 53,938 61,584 15,385 14,583 145,490 Operating leases 17,355 25,686 5,336 1,128 49,505 Depreciation and amortization 10,357 22,419 4,502 ( 472 ) 36,806 Insurance and claims 10,693 1,248 3,147 448 15,536 Fuel expense 2,518 888 1,857 15 5,278 Other operating expenses 18,892 24,265 4,455 ( 4,205 ) 43,407 Segment profit (loss) $ 19,495 $ 7,186 $ 4,415 $ ( 11,574 ) $ 19,522 Interest expense, net ( 45,326 ) Foreign exchange (loss) gain ( 4,653 ) Other income (expense), net ( 6,656 ) Loss from continuing operations before income taxes $ ( 37,113 ) 15 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Six Months Ended June 30, 2026 Expedited Freight Omni Logistics Intermodal Corporate and Eliminations Total External revenues: Ground $ 503,034 $ 268,841 $ — $ — $ 771,875 Contract Logistics — 216,498 — — 216,498 Air and Ocean — 155,626 — — 155,626 Intermodal — — 111,083 — 111,083 Total external revenues 503,034 640,965 111,083 — 1,255,082 Intersegment revenues 88,735 — 1,733 ( 90,468 ) — Total consolidated revenues 591,769 640,965 112,816 ( 90,468 ) 1,255,082 Less: Purchased transportation 309,619 359,089 41,429 ( 90,468 ) 619,669 Salaries, wages and employee benefits 113,218 115,622 27,446 ( 10,670 ) 245,616 Operating leases 31,944 55,168 11,881 972 99,965 Depreciation and amortization 16,807 48,369 8,035 3,572 76,783 Insurance and claims 20,178 744 4,570 1,684 27,176 Fuel expense 5,721 961 4,911 ( 22 ) 11,571 Other operating expenses 39,343 46,286 7,219 18,319 111,167 Impairment of goodwill — 244,006 — — 244,006 Segment profit (loss) $ 54,939 $ ( 229,280 ) $ 7,325 $ ( 13,855 ) $ ( 180,871 ) Interest expense, net ( 87,308 ) Foreign exchange (loss) gain 1,132 Other income (expense), net ( 15,388 ) Loss from continuing operations before income taxes $ ( 282,435 ) 16 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) Six Months Ended June 30, 2025 Expedited Freight Omni Logistics Intermodal Corporate and Eliminations Total External revenues: Ground $ 459,019 $ 327,524 $ — $ — $ 786,543 Contract Logistics — 177,597 — — 177,597 Air and Ocean — 146,665 — — 146,665 Intermodal — — 121,320 — 121,320 Total external revenues 459,019 651,786 121,320 — 1,232,125 Intersegment revenues 48,058 — 318 ( 48,376 ) — Total consolidated revenues 507,077 651,786 121,638 ( 48,376 ) 1,232,125 Less: Purchased transportation 245,128 370,774 40,225 ( 48,565 ) 607,562 Salaries, wages and employee benefits 106,515 118,367 31,316 31,207 287,405 Operating leases 32,788 52,776 11,114 1,620 98,298 Depreciation and amortization 20,736 44,649 9,222 ( 441 ) 74,166 Insurance and claims 21,001 3,863 5,938 ( 260 ) 30,542 Fuel expense 4,989 1,905 4,012 21 10,927 Other operating expenses 40,791 48,891 9,854 ( 596 ) 98,940 Segment profit (loss) $ 35,129 $ 10,561 $ 9,957 $ ( 31,362 ) $ 24,285 Interest expense, net ( 90,873 ) Foreign exchange (loss) gain ( 5,575 ) Other income (expense), net ( 6,552 ) Loss from continuing operations before income taxes $ ( 78,715 ) Operating revenues from the individual services within the Expedited Freight segment are further sub-disaggregated in the table below: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Expedited Freight revenues: Network (1) $ 225,971 $ 193,829 $ 414,148 $ 383,991 Truckload 69,237 42,636 131,781 81,891 Other 23,854 21,231 45,840 41,195 Total Expedited Freight revenues $ 319,062 $ 257,696 $ 591,769 $ 507,077 (1) Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue. Note 9 — Noncontrolling Interest As of June 30, 2026, the Company holds 33,736 Class A Units in Opco and the existing direct and certain indirect equity holders of Omni (“Omni Holders”) hold 6,568 units of Opco designated as Class B Units (“Opco Class B Units”) and 6,568 corresponding Company Series B Preferred Units which together are exchangeable into 6,568 shares of common stock of the Company. 17 Table of Contents Forward Air Corporation Notes to Condensed Consolidated Financial Statements (unaudited and in thousands, except per share data) The following tables provide the exchange activity of the Opco Class B Units and the corresponding fully-diluted noncontrolling interest ownership percentage in the Company based on such exchange activity. Opco Class B Units Fully-diluted Ownership Outstanding units at December 31, 2025 8,760 22.0 % Exchanged into shares of common stock ( 133 ) Outstanding units at March 31, 2026 8,627 21.5 % Exchanged into shares of common stock ( 2,059 ) Outstanding units at June 30, 2026 6,568 16.4 % Opco Class B Units Fully-diluted Ownership Outstanding units at December 31, 2024 10,088 25.3 % Exchanged into shares of common stock ( 585 ) Outstanding units at March 31, 2025 9,503 23.8 % Exchanged into shares of common stock ( 80 ) Outstanding units at June 30, 2025 9,423 23.5 % As of June 30, 2026, there have been a total of 5,537 Opco Class B Units and corresponding Company Series B Preferred Units exchanged for 5,537 shares of common stock, and such actual exchanges and subsequent issuances represented 16.4 % of the outstanding shares of common stock as of the end of such period. Note 10 — Subsequent Event In July 2026, the Company completed the sale of a business unit within its Omni Logistics segment for net proceeds of approximately $ 16.5 million, subject to working capital adjustments. The Company expects to record a gain of approximately $ 8 million to $ 10 million on the sale. 18 Table of Contents