What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2023-02-23 compared with 2022-02-24 · 272 added, 304 removed, 1602 unchanged (26% of the section changed)

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We believe that our audits provide a reasonable basis for our opinion.

Critical audit matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Goodwill impairment assessment

As described further in the footnotes to the consolidated financial statements, management evaluates goodwill on an annual basis as of June 30, or more frequently if impairment indicators exist, at the reporting unit level.

Management estimates the fair values of its reporting units using a combination of the income and market approaches.

The determination of the fair value of the reporting units requires management to make significant estimates and assumptions related to forecasts of future revenues and operating expenses and discount rates.

Changes in these assumptions could materially affect the determination of the fair value of the reporting units, the amount of any goodwill impairment charge, or both.

We identified the goodwill impairment assessment of certain reporting units as a critical audit matter.

The principal consideration for this determination is that management utilized significant judgment when estimating the fair value of these reporting units.

In turn, auditing management’s judgments regarding forecasts of future revenues and

operating expenses, and the discount rates applied, involved a high degree of subjectivity due to the estimation uncertainty of management’s significant judgments.

Our audit procedures related to the goodwill impairment assessment included the following, among others:

• We tested the operating effectiveness of controls relating to the goodwill impairment assessment, including the determination of the fair value of the reporting units.

• We tested management’s process for determining the fair value of the reporting units.

This included evaluating the appropriateness of the valuation methods and testing the completeness, accuracy and relevance of data used by management.

• We evaluated the reasonableness of management’s significant assumptions, which included forecasted revenues and operating expenses.

We tested whether these forecasts were reasonable and consistent with historical performance, third-party market data, and other evidence obtained in other areas of the audit.

• We tested the Company’s discounted cash flow models for the reporting units with the assistance of valuation specialists, including the reasonableness of the utilized discount rates.

• We tested the Company’s use of the market approach with the assistance of valuation specialists, including the reasonableness of selected multiples.

Indefinite-lived intangible asset impairment assessment – trade name

As described further in the footnotes to the consolidated financial statements, management evaluates the trade names for impairment on an annual basis, or more frequently if impairment indictors exist.

The impairment test consists of a comparison of the carrying amount with the projected discounted cash flows from the use and eventual disposition of the asset group.

The determination of the fair value of the trade names requires management to make significant estimates and assumptions related to forecasts of future revenues, discount rates, and royalty rates.

Changes in these assumptions could materially affect the determination of the fair value of the trade names, the amount of any trade names impairment charge, or both.

We identified the trade name impairment assessment of a certain trade name as a critical audit matter.

The principal consideration for this determination is that management used significant judgment when estimating the fair value of the trade name.

In turn, auditing management’s judgments regarding forecasts of future revenue, the discount rate applied, and the royalty rate, involved a high degree of subjectivity due to the estimation uncertainty of management’s significant judgments.

Our audit procedures related to the trade name indefinite-lived intangible asset impairment assessment included the following, among others:

• We tested the operating effectiveness of controls relating to the trade name impairment assessment, including the determination of the fair value of the trade name.

• We tested management’s process for determining the fair value of the trade name.

This included evaluating the appropriateness of the valuation method, testing the completeness, accuracy and relevance of data used by management.

• We evaluated the reasonableness of management’s significant assumptions, which included forecasted revenues.

We tested whether these forecasts were reasonable and consistent with historical performance, third-party market data, and other evidence obtained in other areas of the audit.

• We tested the reasonableness of the Company’s discount rate and royalty rate with the assistance of valuation specialists.

Swift Auto liability and workers’ compensation claims reserve accrual

As described in the footnotes to the consolidated financial statements, the Company is self-insured for a portion of its risk related to auto liability and workers’ compensation.

Critical audit matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Swift auto liability claims accrual

As described in footnote 12 to the financial statements, the Company is self-insured for a portion of its risk related to auto liability claims.

The Company accrues for the cost of the uninsured portion of pending claims by evaluating the nature and severity of individual claims and by estimating future claims development based upon historical development trends.

The actual cost to settle self-insured claim liabilities may differ from the Company’s reserve estimates due to legal costs, claims that have been incurred but not reported, and various other uncertainties, including the inherent difficulty in estimating the severity of the claims and the potential judgment or settlement amount to dispose of the claim.

We identified the estimation of Swift’s auto liability and workers’ compensation claims accruals, subject to certain self-insured retention, as a critical audit matter.

Auto liability and workers’ compensation unpaid claim liabilities are determined by projecting the estimated ultimate loss related to a claim, less actual costs paid to date.

We identified the estimation of Swift’s auto liability claims accrual, which is subject to certain self-insured retention limits, as a critical audit matter.

Auto liability unpaid claim liabilities are determined by projecting the estimated ultimate loss related to a claim, less actual costs paid to date.

These estimates rely on the assumption that historical claim patterns are an accurate representation for future claims that have been incurred but not completely paid.

The principal considerations for assessing auto liability and workers’ compensation claims as a critical audit matter are the high level of estimation uncertainty related to determining the severity of these types of claims, as well as the inherent subjectivity in management’s judgment in estimating the total costs to settle or dispose of these claims.

principal considerations for assessing the auto liability claims accrual as a critical audit matter is the high level of estimation uncertainty related to determining the severity of these types of claims, as well as the inherent subjectivity in management’s judgment in estimating the total costs to settle or dispose of these claims.

Our audit procedures related to this critical audit matter included the following, among others:

• We tested the operating effectiveness of controls over auto liability and workers’ compensation claims, including the completeness and accuracy of claim expenses and payments.

• We tested management’s process for determining the auto liability and workers’ compensation accrual, including evaluating the reasonableness of the methods and assumptions used in estimating the ultimate claim losses with the assistance of an actuarial specialist.

• We tested the claims data used in the claims liability calculation by inspecting source documents to test key attributes of the claims data.

Customer relationships acquired with the AAA Cooper Transportation acquisition

As described further in the footnotes to the consolidated financial statements, on July 5, 2021, the Company acquired 100% of AAA Cooper Transportation.

The total purchase price consideration was $1.31 billion, which allocated $406.2 million to separately identified intangible assets, including customer relationships of $250.8 million.

The determination of the fair value of the customer relationships requires management to make significant estimates and assumptions related to forecasts of future revenues, expenses and the discount rate applied.

Changes in these assumptions could materially affect the determination of the fair value of the customer relationships.

We identified the fair value assigned to the customer relationships included on the opening balance sheet as a critical audit matter.

The principal considerations for our determination that the acquired customer relationships are a critical audit matter is that management utilized significant judgment when estimating the fair value assigned to the customer relationships.

In turn, auditing management’s judgments regarding the assigned fair value involved a high degree of subjectivity due to the estimation uncertainty of management’s significant judgments.

Our audit procedures related to the estimated fair value assigned to acquired customer relationships included the following, among others.

• We tested the operating effectiveness of controls relating to the identification of the acquired customer relationships, including the determination of the fair value.

• We tested management’s process for determining the fair value of the acquired customer relationships.

This included evaluating the appropriateness of the valuation method and testing the completeness, accuracy, and relevance of data used by management.

• We evaluated the reasonableness of management’s significant assumptions, which included forecasted revenues and operating expenses.

We tested whether these forecasts were reasonable and consistent with historical performance and third-party market data.

• We tested the reasonableness of the Company’s discount rate applied to the present value of the estimated future cash flows model with the assistance of valuation specialists.

• We tested the operating effectiveness of controls over auto liability claims, including the completeness and accuracy of claim expenses and payments and management’s review over actuarial calculations.

• We tested management’s process for determining the auto liability claims accrual, including evaluating the reasonableness of the methods and assumptions used in estimating the ultimate claim losses with the assistance of an actuarial specialist.

• We tested the claims data used in the actuarial calculation by selecting samples of historical claims data and inspecting source documents to test key attributes of the claims data.

/s/ GRANT THORNTON LLP

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Leasehold improvements 16,587 13,915

Total property and equipment 5,118,897 4,223,348

Gross property and equipment 5,740,383 5,118,897

accumulated depreciation and amortization ( 1,905,340 ) ( 1,563,533 )

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Operating lease liabilities – current portion 36,961 35,322

Accounts receivable securitization – current portion — 213,918

Total current liabilities 894,007 1,074,816

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Operating lease liabilities – less current portion 149,992 107,614

Accounts receivable securitization – less current portion 278,483 —

Accounts receivable securitization 418,561 278,483

Claims accruals – less current portion 201,838 210,714

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160,706 and 165,980 shares issued and outstanding as of December 31, 2022 and 2021, respectively.

Accumulated other comprehensive loss ( 563 ) —

Additional paid-in capital 4,392,266 4,350,913

Accumulated other comprehensive loss ( 2,436 ) ( 563 )

Retained earnings 2,553,567 2,181,142

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Interest expense ( 50,803 ) ( 21,140 ) ( 17,309 )

Other income, net 28,905 11,254 12,137

Other (expenses) income, net ( 25,958 ) 28,905 11,254

Total other (expenses) income, net ( 71,322 ) 8,938 ( 4,127 )

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Net income 771,118 743,748 410,635

Net income attributable to noncontrolling interest ( 360 ) ( 633 ) ( 972 )

Net loss (income) attributable to noncontrolling interest 207 ( 360 ) ( 633 )

Net income attributable to Knight-Swift $ 771,325 $ 743,388 $ 410,002

Other comprehensive loss ( 563 ) — —

Other comprehensive income (loss) ( 1,873 ) ( 563 ) —

Comprehensive income $ 769,452 $ 742,825 $ 410,002

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Consolidated Statements of Stockholders' Equity

Common Stock Additional Paid-in Capital Retained Earnings Accumulated

Comprehensive Loss Total

Knight-Swift Stockholders' Equity Noncontrolling Interest Total Stockholders' Equity

Common Stock Additional

Paid-in Capital Retained Earnings Accumulated

Comprehensive Loss Total Knight-Swift Stockholders' Equity Noncontrolling

Interest Total

Stockholders’ Equity

Shares Par Value

(In thousands)

(In thousands, except per share data)

Balances – December 31, 2019 170,688 $ 1,707 $ 4,269,043 $ 1,395,465 $ — $ 5,666,215 $ 2,088 $ 5,668,303

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( 54,661 ) ( 54,661 ) ( 54,661 )

Net income attributable to Knight-Swift 309,206 309,206 309,206

Distribution to noncontrolling interest ( 654 ) ( 654 )

Net income attributable to noncontrolling interest 972 972

Net income 410,002 410,002 633 410,635

Investment in noncontrolling interest ( 529 ) ( 529 )

Balances – December 31, 2020 166,553 $ 1,665 $ 4,301,424 $ 1,566,759 $ — $ 5,869,848 $ 2,192 $ 5,872,040

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Common stock issued to the Board 12 — 575 575 575

Common stock issued with ACT Acquisition 219 2 9,998 10,000 10,000

Common stock issued under ESPP 63 1 2,782 2,783 2,783

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( 63,587 ) ( 63,587 ) ( 63,587 )

Net income attributable to Knight-Swift 410,002 410,002 410,002

Distribution to noncontrolling interest ( 529 ) ( 529 )

Net income attributable to noncontrolling interest 633 633

Net income 743,388 743,388 360 743,748

Other comprehensive income ( 563 ) ( 563 ) ( 563 )

Noncontrolling interest associated with acquisition 10,281 10,281

Investment in noncontrolling interest ( 64 ) ( 64 )

Net acquisition of remaining ownership interest, previously noncontrolling ( 3,279 ) ( 3,279 ) ( 2,471 ) ( 5,750 )

Balances – December 31, 2021 165,980 $ 1,660 $ 4,350,913 $ 2,181,142 $ ( 563 ) $ 6,533,152 $ 10,298 $ 6,543,450

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Common stock issued to the Board 18 — 873 873 873

Common stock issued with ACT Acquisition 219 2 9,998 10,000 10,000

Common stock issued under ESPP 84 1 4,047 4,048 4,048

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( 78,396 ) ( 78,396 ) ( 78,396 )

Net income attributable to Knight-Swift 743,388 743,388 743,388

Net income 771,325 771,325 ( 207 ) 771,118

Other comprehensive income ( 1,873 ) ( 1,873 ) ( 1,873 )

Noncontrolling interest associated with acquisition 10,281 10,281

Distribution to noncontrolling interest ( 64 ) ( 64 )

Net income attributable to noncontrolling interest 360 360

Net acquisition of remaining ownership interest, previously noncontrolling ( 3,279 ) ( 3,279 ) ( 2,471 ) ( 5,750 )

Investment in noncontrolling interest 186 186

Balances – December 31, 2022 160,706 $ 1,607 $ 4,392,266 $ 2,553,567 $ ( 2,436 ) $ 6,945,004 $ 10,277 $ 6,955,281

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Non-cash lease expense 41,943 45,192 80,891

Loss (gain) on equity securities 52,274 ( 3,931 ) ( 3,737 )

Non-cash adjustment to fair value of convertible note — ( 12,631 ) —

Other adjustments to reconcile net income to net cash provided by operating activities 46,632 44,841 47,419

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Net cash, restricted cash, and equivalents invested in acquisitions ( 31,291 ) ( 1,496,208 ) ( 46,811 )

Investment in convertible notes ( 35,000 ) — —

Investment in convertible note — ( 35,000 ) —

Other cash flows from investing activities 4,233 ( 5,060 ) ( 42,320 )

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Proceeds from long-term debt — 1,200,000 —

Borrowings (repayments) on revolving lines of credit, net 50,000 ( 69,000 ) 84,000

(Repayments) borrowings on revolving lines of credit, net ( 217,000 ) 50,000 ( 69,000 )

Borrowings under accounts receivable securitization 140,000 80,000 61,000

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Other cash flows from financing activities ( 31,701 ) ( 14,357 ) ( 13,517 )

Net cash provided by (used in) financing activities 779,326 ( 443,884 ) ( 184,636 )

Net cash (used in) provided by financing activities ( 754,347 ) 779,326 ( 443,884 )

Net increase (decrease) in cash, restricted cash, and equivalents 35,322 152,746 ( 4,951 )

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Equipment acquired included in accounts payable $ 34,909 $ 10,489 $ 651

Equipment sales receivables 67 223 1,333

Financing provided to independent contractors for equipment sold 4,773 5,428 5,288

Transfer from property and equipment to assets held for sale 92,445 75,292 137,391

Transfers from property and equipment to assets held for sale 90,951 92,445 75,292

Noncontrolling interest associated with acquisition — 10,281 —

Contingent consideration associated with acquisition 6,250 16,200 —

Purchase price adjustment on acquisition 2,164 — —

Contingent consideration associated with acquisitions and investments 1,717 6,250 16,200

Value of common stock issued for acquisition — 10,000 —

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Right-of-use assets obtained in exchange for operating lease liabilities 86,910 22,771 12,406

Right-of-use assets obtained in exchange for new operating lease liabilities through acquisitions 50,988 12,356 —

Property and equipment obtained in exchange for new finance lease liabilities 181,234 137,097 —

Right-of-use assets obtained in exchange for operating lease liabilities through acquisitions — 50,988 12,356

Property and equipment obtained in exchange for finance lease liabilities 152,509 181,234 137,097

Property and equipment obtained in exchange for finance lease liabilities reclassified from operating lease liabilities 6,462 42,298 67,430

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The LTL segment operated an average 3,176 tractors and 8,431 trailers.

Additionally, the Intermodal segment operated an average of 597 tractors and 10,847 intermo dal cont ainers.

The Company's four reportable segments are Truckload, Logistics, LTL, and Intermodal.

Additionally, the Intermodal segment operated an average of 613 tractors and 11,786 intermodal containers.

The Company's four reportable segments are Truckload, LTL, Logistics, and Intermodal.

On September 8, 2017, the Company became Knight-Swift Transportation Holdings Inc.

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Similarly, references to "quarters", including "first", "second", "third", and "fourth" pertain to calendar quarters.

In the full truckload transportation industry, results of operations generally follow a seasonal pattern.

Freight volumes in the first quarter are typically lower due to less consumer demand, customers reducing shipments following the holiday season, and inclement weather.

At the same time, operating expenses generally increase, and tractor productivity of the Company's Truckload fleet, independent contractors, and third-party carriers decreases during the winter months due to decreased fuel efficiency, increased cold-weather-related equipment maintenance

Changes in Presentation

Beginning in the second quarter of 2022, the Company separately disclosed "Loss (gain) on equity securities" in the condensed consolidated statement of cash flows.

Accordingly, the amounts presented in the Company's 2021 and 2020 consolidated statement of cash flows were reclassified from "Other adjustments to reconcile net income to net cash provided by operating activities" to "Loss (gain) on equity securities" to align with the current year presentation.

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and repairs, and increased insurance claims and costs attributed to higher accident frequency from harsh weather.

In the full truckload transportation industry, results of operations generally follow a seasonal pattern.

Freight volumes in the first quarter are typically lower due to less consumer demand, customers reducing shipments following the holiday season, and inclement weather.

These factors typically lead to lower operating profitability, as compared to other parts of the year.

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• contingent obligations;

• calculation of projected pension benefit obligation;

• calculation of stock-based compensation;

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• valuation of financial instruments.

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Segments — The Company uses the "management approach" to determine its reportable segments, as well as to determine the basis of reporting the operating segment information.

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Operating income should not be viewed as a substitute for GAAP net income.

Management believes the

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presentation of operating income enhances the understanding of the Company's performance by highlighting the results of operations and the underlying profitability drivers of the business segments.

Management believes the presentation of operating income enhances the understanding of the Company's performance by highlighting the results of operations and the underlying profitability drivers of the business segments.

Operating income is defined as "Total revenue" less "Total operating expenses."

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Restricted Cash and Equivalents — The Company's wholly-owned captive insurance companies, Red Rock and Mohave, maintain certain operating bank accounts, working trust accounts, and investment accounts.

The cash and cash equivalents within these accounts are restricted by insurance regulations to fund the insurance claim losses to be paid by the captive insurance companies, and therefore, are classified as "Cash and cash equivalents – restricted" and within "Other long-term assets" in the consolidated balance sheets.

The cash and cash equivalents within these accounts are restricted by insurance regulations to fund the insurance claim losses to be paid by the captive insurance companies, and therefore, are classified as "Cash and cash equivalents – restricted" and included within "Other long-term assets" in the consolidated balance sheets.

Restricted Investments — The Company's investments are restricted by insurance regulations to fund the insurance claim losses to be paid by the captive insurance companies.

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See Note 5 for additional disclosures regarding the Company's restricted investments.

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Inventories and Supplies — Inventories and supplies, which are included in "Other current assets" in the consolidated balance sheets, primarily consist of spare parts, tires, fuel, and supplies and are stated at lower of cost or net realizable value.

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Maintenance and repairs are expensed as incurred.

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Net gains on the disposal of property and equipment are presented in the consolidated statements of comprehensive income within "Miscellaneous operating expenses."

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Furniture and fixtures 3 — 10

Leasehold improvements Life of the lease

Leasehold improvements Lesser of lease term or leasehold improvement life

*For finance leases involving revenue equipment, the depreciation period is equal to the term of the lease agreement.

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On a periodic basis, the Company assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than the carrying amount.

If the Company concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company conducts a quantitative goodwill impairment test.

If the Company concludes that it is more likely than

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not that the fair value of a reporting unit is less than its carrying amount, then the Company conducts a quantitative goodwill impairment test.

See Notes 4 and 10 for additional disclosures regarding the Company's goodwill.

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Certain trade names have indefinite useful lives and are not amortized, but are tested for impairment at least annually, unless events occur or circumstances change between annual tests that would more likely than not reduce the fair value.

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Management reviews its intangible assets for impairment whenever events or circumstances indicate that the carrying amount of the asset may not be recoverable, in accordance with ASC 350, Intangibles – Goodwill and Other.

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Options to renew or purchase the underlying assets are considered in the determination of the right-of-use asset and corresponding lease liability once reasonably certain of exercise.

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• Portfolio Approach — The Company typically leases its revenue equipment under master lease agreements, which contain general terms, conditions, definitions, representations, warranties, and other general language, while the specific contract provisions are contained within the various individual lease schedules that fall under a master lease agreement.

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Each individual real estate and other lease is accounted for at the individual asset level.

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• Nonlease Components — Management has elected to combine its nonlease components (such as fixed charges for common area maintenance, real estate taxes, utilities, and insurance) with lease components for each class of underlying asset, as applicable, as the nonlease components in the Company’s lease contracts typically are not material.

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Contingencies — See Note 19 for accounting policies and financial information related to contingencies.

Revenue Recognition — Management applies the five-step analysis to the Company's four reportable segments (Truckload, Logistics, LTL, and Intermodal).

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Revenue Recognition — Management applies the five-step analysis to the Company's four reportable segments (Truckload, LTL, Logistics, and Intermodal).

Contract Identification — Management has identified that a legally enforceable contract with its customers is executed by both parties at the point of pickup at the shipper's location, as evidenced by the bill of lading.

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The Company's delivery, accessorial, and dedicated operations truck capacity in its dedicated operations represent a bundle of services that are highly interdependent and have the same pattern of transfer to the customer.

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These services are not capable of being distinct from one another.

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Accordingly, revenue is recognized over time.

Management estimates the amount of revenue in transit at period end based on the number of days completed of the dispatch (which is generally one to three days for the Truckload, Logistics and LTL segments, but can be longer for intermodal operations).

Management estimates the amount of revenue in transit at period end based on the number of days completed of the dispatch (which is generally one to three days for the Truckload, LTL, and Logistics segments, but can be longer for intermodal operations).

Management believes this to be a faithful depiction of the transfer of services because if a load is dispatched, but terminates mid-route and the load is picked up by another carrier, then that carrier would not need to re-perform the services for the days already traveled.

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• Revenue Disaggregation — In considering the level at which the Company should disaggregate revenues pertaining to contracts with customers, management determined that there are no significant differences between segments in how the nature, amount, timing, and uncertainty of revenue or cash flows are affected by economic factors.

Additionally, management considered how and where the Company has communicated information about revenue for various purposes, including disclosures outside of the financial statements and how information is regularly reviewed by the Company's chief operating decision makers for evaluating financial performance of the Company's segments, among others.

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performance of the Company's segments, among others.

Based on these considerations, management determined that revenues should be disaggregated by reportable segment.

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Losses from lease defaults are recognized as offsets to revenue.

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Stock-based Compensation — The Company accounts for stock-based compensation expense in accordance with ASC 718, Compensation – Stock Compensation.

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Management judgment is necessary in determining the frequency at which the need for a valuation allowance is assessed, the accounting period in which to establish the valuation allowance, as well as the amount of the valuation allowance.

Unrecognized tax benefits are defined as the difference between a tax position taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to ASC 740, Income Taxes .

The Company does not recognize a tax benefit for uncertain tax positions unless it concludes that it is more likely than not that the benefit will be sustained on audit (including resolutions of any related appeals or litigation processes) by the taxing authority, based solely on the technical merits of the associated tax position.

If the recognition threshold is met, the Company recognizes a tax benefit measured at the largest amount of the tax benefit that, in management's judgment, is greater than 50 % likely to be realized.

The Company records expected incurred interest and penalties related to unrecognized tax positions in "Income tax expense" in the consolidated statements of comprehensive

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If the recognition threshold is met, the Company recognizes a tax benefit measured at the largest amount of the tax benefit that, in management's judgment, is greater than 50 % likely to be realized.

The Company records expected incurred interest and penalties related to unrecognized tax positions in "Income tax expense" in the consolidated statements of comprehensive income.

To the extent interest and penalties are not assessed with respect to uncertain tax positions, amounts accrued will be reduced and reflected as a reduction of the overall income tax provision.

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See Note 13 for additional disclosures regarding the Company's income taxes.

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Note 3 — Recently Issued Accounting Pronouncements

Date Issued Reference Description Expected Adoption Date and Method Financial Statement Impact

June 2022 ASU No.

Fair Value Measurements (ASC 820), Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions

The amendments in this ASU clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security, and not considered in measuring fair value.

January 2024, Prospective No material impact

March 2022 ASU No.

Financial Instruments – Credit Losses (ASC 326), Troubled Debt Restructurings and Vintage Disclosures

The amendments in this ASU require that a creditor incorporates troubled debt restructurings into the allowance for credit losses and disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases.

January 2023, Prospective Currently under evaluation, but not expected to be material

October 2021 ASU No.

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Since management is continuing to evaluate the impacts of the above standards, disclosures around these preliminary assessments are subject to change.

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Note 4 — Acquisitions

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This was funded through cash-on-hand and borrowing on the 2021 Revolver on the transaction date.

At closing, $ 2.8 million of the cash consideration was placed in escrow to secure certain of the sellers' indemnification obligations and remains subject to further adjustments.

At closing, $ 2.8 million of the cash consideration was placed in escrow to secure certain of the sellers' indemnification obligations.

During the fourth quarter of 2022, the escrow proceeds were released to the sellers pursuant to the SPA.

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The purchase of the equity interests of MME results in the historical tax basis of MME's assets continuing to be recovered and any intangible assets arising through purchase accounting will result in additional stock basis for tax purposes.

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The goodwill is not expected to be deductible for tax purposes.

During the measurement period, total goodwill related to the MME acquisition increased by $ 4.2 million during 2022 as a result of adjustments to valuations of deferred tax liabilities and accounts receivable as well as a $ 1.3 million actual versus estimated net working capital adjustment which increased the total purchase price consideration to $ 165.7 million.

The total purchase price consideration, as adjusted at the December 6, 2021 transaction date, is identified in the "Purchase Price Allocations" table within this footnote.

On July 5, 2021 , the Company acquired 100.0 % of Dothan, Alabama-based ACT.

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The SPA contains customary representations, warranties, and covenants.

The Company's consolidated financial statements for 2021 include ACT's operating results beginning July 5, 2021 (closing of the acquisition) through December 31, 2021.

During 2022, the Company's consolidated operating results included ACT's total revenue of $ 918.9 million and net income of $ 77.0 million.

ACT's net income during 2022 included $ 14.0 million related to the amortization of intangible assets acquired in the ACT Acquisition.

During 2021, the Company's consolidated operating results included ACT's total revenue of $ 386.8 million and net income of $ 23.1 million.

ACT's net income during 2021 included $ 7.0 million related to the amortization of intangible assets acquired in the ACT Acquisition.

The goodwill recognized represents expected synergies from combining the operations of ACT with the Company, including enhanced service offerings, as well as other intangible assets that did not meet the criteria for separate recognition.

The goodwill is expected to be deductible for tax purposes.

The total purchase price consideration, as if adjusted at the July 5, 2021 transaction date, is identified in the "Purchase Price Allocations" table within this footnote.

The purchase price allocation was open for adjustments through the end of the measurement period, which closed one year from the July 5, 2021 acquisition date.

Pro Forma Information (Unaudited) — The following unaudited pro forma information combines the historical operations of the Company and ACT giving effect to the ACT Acquisition, and related transactions as if consummated on January 1, 2020, the beginning of the comparative period presented.

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As a result of the ACT Acquisition, the Company incurred certain acquisition-related expenses totaling $ 2.9 million in 2021.

These expenses were eliminated in the presentation of the unaudited pro forma "Net income attributable to Knight-Swift" presented above.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

These expenses were eliminated in the presentation of the unaudited pro forma "Net income attributable to Knight-Swift" presented above.

The unaudited pro forma condensed combined financial information does not purport to represent the actual results of operations that Knight-Swift and ACT would have achieved had the companies been combined during the periods presented in the unaudited pro forma condensed combined financial statements and is not intended to project the future results of operations that the combined company may achieve after the identified transactions.

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The total purchase price consideration of $ 37.2 million, including cash-on-hand and net working capital adjustments, consisted of $ 32.2 million in cash to the sellers at closing, which was funded through cash-on-hand and borrowing on the 2017 Revolver on the transaction date.

At closing $ 2.25 million of the cash consideration was placed in escrow to secure certain of the sellers' indemnification obligations and remains subject to further adjustments.

At closing $ 2.25 million of the cash consideration was placed in escrow to secure certain of the sellers' indemnification obligations.

During the third quarter of 2022, the escrow proceeds were released to the sellers pursuant to the SPA.

The purchase price also included contingent consideration consisting of two additional annual payments of up to $ 2.5 million each ($ 5.0 million in total), representing the maximum possible annual deferred payments to the sellers based on operating ratio and revenue growth targets for each of the twelve-month periods ending May 31, 2022 and May 31, 2023.

As of December 31, 2022, $ 2.5 million is included in "Accrued liabilities" in the Company's consolidated balance sheets.

As of December 31, 2021, $ 2.5 million is included in "Accrued liabilities" and $ 2.5 million is included in "Other long-term liabilities" in the Company's consolidated balance sheets, depending on the expected payment dates.

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The goodwill is expected to be deductible for tax purposes.

The total purchase price consideration, as if adjusted at the June 1, 2021 transaction date, is identified in the "Purchase Price Allocations" table within this footnote.

The purchase price allocation was open for adjustments through the end of the measurement period, which closed one year from the June 1, 2021 acquisition date.

On February 1, 2021 , pursuant to a membership interest purchase agreement ("MIPA"), the Company, through a wholly owned subsidiary, acquired 79.44 % of the issued and outstanding membership interests of Eleos, a Greenville, South Carolina-based software provider, specializing in mobile driving platforms, which complement the Company's suite of services.

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At closing, $ 4.1 million of the cash consideration was placed in escrow to secure certain of the sellers' indemnification obligations and other items.

During the third quarter of 2022, the escrow proceeds were released to the sellers pursuant to the MIPA.

The MIPA included that both the buyer and sellers would file an election under the Internal Revenue Code Section 754 to adjust the tax basis of the Company's assets and liabilities, with respect to the buyer's purchase of the equity.

The MIPA contains customary representations, warranties, covenants, and indemnification provisions for transactions of this nature.

The goodwill recognized represents expected synergies from combining the operations of Eleos with the Company, including enhanced service offerings, as well as other intangible assets that did not meet the criteria for separate recognition.

The goodwill is expected to be deductible for tax purposes.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

The goodwill is expected to be deductible for tax purposes.

The total purchase price consideration, as if adjusted at the February 1, 2021 transaction date, is identified in the "Purchase Price Allocations" table within this footnote.

The purchase price allocation was open for adjustments through the end of the measurement period, which closed one year from the February 1, 2021 acquisition date.

Warehousing Co.

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During the fourth quarter of 2021, the Company paid the second annual payment of $ 8.1 million as a result of the achievement of Warehousing Co.’s EBIT performance target for the calendar year 2021.

As of December 31, 2021, the remaining estimated contingent consideration was $ 8.1 million representing the fair value of the remaining annual deferred payments for the annualized six-month period ending June 30, 2022, all of which was recorded in "Accrued liabilities" in the consolidated balance sheets.

As of December 31, 2020, the remaining contingent consideration was $ 16.2 million representing the fair value of the remaining annual deferred payments for the calendar year December 31, 2021 and the annualized six-month period ending June 30, 2022.

As of December 31, 2020, $ 8.1 million of the total was recorded in "Accrued liabilities" in the consolidated balance sheets and the remaining $ 8.1 million was recorded in "Other long-term liabilities" in the consolidated balance sheets.

During the fourth quarter of 2022, the Company paid the final annual payment of $ 8.1 million as a result of the achievement of Warehousing Co.’s EBIT performance target for the six-month period ended June 30, 2022.

As of December 31, 2022, all contingent consideration had been paid in full and no further liability was recorded.

As of December 31, 2021, the remaining contingent consideration was $ 8.1 million representing the fair value of the remaining annual deferred payments for the annualized six-month period ending June 30, 2022, all of which was recorded in "Accrued liabilities" in the consolidated balance sheets.

The SPA included an election under the Internal Revenue Code Section 338(h)(10).

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

Asset Purchase Agreement

On October 3, 2022 , the Company entered into an asset purchase agreement with a total purchase consideration of $ 30.0 million for the purchase of revenue equipment and certain intangibles.

The purchase price was allocated based on estimated fair values of the assets acquired and liabilities assumed at the acquisition date, resulting in the Company recording $ 19.4 million in "Revenue Equipment" and $ 10.4 million in "Customer Relationships" in the Company's consolidated balance sheets.

The purchase price allocation is preliminary and is open for adjustments through the end of the measurement period, which is one year from the October 3, 2022 acquisition date, pending completion of the valuation of acquired tangible assets, an independent valuation of certain acquired intangible assets, the calculation of deferred taxes based upon the underlying tax basis of assets acquired and liabilities assumed, and assessment of other tax related items as applicable.

Purchase Price Allocations

The purchase price allocations for the Company's acquisitions are preliminary, except for Warehousing Co., and have been allocated based on estimated fair values of the assets acquired and liabilities assumed at the acquisition dates, and among other things may be pending the completion of the valuation of acquired tangible assets, an independent valuation of certain acquired intangible assets, assessment of lease agreements, assessment of certain liabilities, the calculation of deferred taxes based upon the underlying tax basis of assets acquired and liabilities assumed, and assessment of other tax related items as applicable.

As the Company obtains more information, the preliminary purchase price allocations disclosed below are subject to change.

Any future adjustments to the preliminary purchase price allocations, including changes within identifiable intangible assets or estimation uncertainty impacted by market conditions, may impact future net earnings.

The purchase price allocation adjustments can be made through the end of the measurement periods, which are not to exceed one year from the respective acquisition dates.

MME ACT UTXL Eleos Warehousing Co.

The purchase price allocations for the Company's acquisitions have been allocated based on estimated fair values of the assets acquired and liabilities assumed at the acquisition dates.

The purchase price allocations were open for adjustment through the end of the measurement period, which closed one year from the acquisition dates.

ACT UTXL Eleos Warehousing Co.

December 6, 2021 Opening Balance Sheet as Reported at December 31, 2022 July 5, 2021 Opening Balance Sheet as Reported at December 31, 2022 June 1, 2021 Opening Balance Sheet as Reported at December 31, 2022 February 1, 2021 Opening Balance Sheet as Reported at December 31, 2022 January 1, 2020 Opening Balance Sheet as Reported at December 31, 2022

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Goodwill $ 57,443 $ 490,879 $ 12,315 $ 35,747 $ 3,983

1 See above for a description of the working capital adjustments made to Warehousing Co.'s purchase price allocation during the measurement period.

1 See above for a description of the adjustments made to MME's purchase price allocation during the measurement period.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

2 See above for a description of the working capital adjustments made to Warehousing Co.'s purchase price allocation during the measurement period.

3 Includes $ 372.2 million in customer relationships ($ 250.8 million attributed to ACT), $ 2.0 million in noncompete agreements ($ 0.8 million attributed to ACT), $ 10.5 million in internally developed software ($ 6.5 million attributable to ACT), and $ 168.0 million in trade names ($ 148.1 million attributed to ACT).

7 unchanged sentences

US corporate securities $ 5,978 $ — $ ( 44 ) $ 5,934

Government bonds 1,197 — ( 1 ) 1,196

Restricted investments, held-to-maturity $ 7,175 $ — $ ( 45 ) $ 7,130

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Restricted investments, held-to-maturity $ 5,866 $ — $ ( 7 ) $ 5,859

As of December 31, 2021, the contractual maturities of the restricted investments were one year or less.

There were eleven and sixteen securities that were in an unrealized loss position, all for less than twelve months as of December 31, 2021 and 2020, respectively.

As of December 31, 2022, the contractual maturities of the restricted investments were one year year or less.

There were fourteen and eleven securities that were in an unrealized loss position, all for less than twelve months as of December 31, 2022 and 2021, respectively.

The Company did no t recognize any impairment losses related to restricted investments during 2022, 2021, or 2020.

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TRP IV Coinvestment QLS – equity method investment 2

25.0 % $ 39,000 $ 9,735 $ —

TRP IV Coinvestment FFR – equity method investment 2

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13.3 % $ 30,000 $ 4,000 $ —

1 The Company's share of the results is included within "Other income, net" in the consolidated statements of comprehensive income.

2 In accordance with ASC 321, Investments – Equity Securities , these investments are recorded at cost minus impairment.

3 Management anticipates that $ 1.7 million will be due in 2022.

4 Management anticipates that the following amounts will be due:

$ 0.1 million in 2022, $ 0.1 million from 2023 through 2024, $ 0.5 million in 2025, and none thereafter .

1 The Company's share of the results is included within "Other (expenses) income, net" in the consolidated statements of comprehensive income.

2 The TRP III, TRP IV Coinvestments, TRP V, and TRP V Coinvest are unconsolidated majority interests.

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Knight's ownership interest reflects its ultimate ownership of the portfolio companies underlying the TRP III, TRP IV Coinvestment NTI, TRP IV Coninvestment QLS, TRP IV Coinvestment FFR, TRP V, and TRP V Coninvest legal entities.

3 In accordance with ASC 321, Investments – Equity Securities , these investments are recorded at cost minus impairment.

4 Management anticipates that the following amounts will be due:

$ 0.1 million in 2023, $ 0.5 million from 2024 through 2025, and none thereafter .

5 TRP IV Coinvestment NTI was liquidated during 2022.

6 Management anticipates that the following amounts will be due:

$ 5.6 million in 2023, $ 2.1 million from 2024 through 2025, $ 0.8 million from 2026 through 2027, and $ 2.3 million thereafter.

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Further, the Company acquired an additional $ 25.0 million in Embark's common stock pursuant to a common stock subscription agreement between the Company and Embark.

As of December 31, 2021, the fair value of the combined investment in Embark was $ 54.5 million, resulting in a net unrealized gain of $ 4.5 million recognized during 2021 in "Operating income, net" in the consolidated statements of comprehensive income.

As of December 31, 2022 and 2021, the fair value of the combined investment in Embark was $ 1.0 million and $ 54.5 million, respectively.

This resulted in a net unrealized loss of $ 53.4 million and net unrealized gain of $ 4.5 million recognized during 2022 and 2021, respectively, within "Operating income, net" in the consolidated statements of comprehensive income.

Other Equity Method Investments

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TRP V Coinvest – equity method investment 5,228 4,859

– equity method investment 2

38,821 40,335

Embark – equity investment 1,032 54,467

Other equity method investments – equity method investment 2

56,375 38,821

Total carrying value $ 104,549 $ 130,236

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Insurance premiums 61,696 43,455

30,316 18,477

Other 56,249 30,316

Trade receivables 865,274 932,999

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Trade receivables, net $ 842,294 $ 911,336

1 Prior year amounts within the table above have been reclassified to conform to current year presentation.

The following is a rollforward of the allowance for doubtful accounts for trade receivables:

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Ending balance $ 22,980 $ 21,663 $ 22,093

1 Represents allowance for doubtful trade accounts receivables assumed in 2021 from the Company's acquisitions.

1 Represents measurement period adjustment during 2022 related to the MME acquisition and allowance for doubtful trade accounts receivables assumed in 2021 from the Company's acquisitions.

See Note 4 for further details regarding these acquisitions.

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Long-term portion $ 3,529 $ 14,760

Convertible Note

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

Convertible Note

During the fourth quarter of 2021, the Company invested $ 10.0 million in a third-party company in exchange for a convertible note.

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Net gains on disposals, including disposals of property and equipment classified as assets held for sale, reported in "Miscellaneous operating expenses" in the consolidated statements of comprehensive income were $ 92.9 million during 2022, $ 74.8 million during 2021, and $ 9.7 million during 2020.

During 2021 , the Company incurred impairment losses of $ 0.3 million, primarily related to certain legacy trailer models.

During 2022 , the Company did not recognize impairment losses related to assets held for sale.

During 2021, t he Company incurred impairment losses of $ 0.3 million, primarily related to certain tractors and trailers as a result of a softer used equipment market.

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(In thousands)

Goodwill at beginning of period $ 2,922,964 $ 2,918,992 $ 2,919,176

Amortization relating to deferred tax assets ( 9 ) ( 11 ) ( 232 )

Acquisitions 1

Goodwill balance at beginning of period $ 3,515,135 $ 2,922,964 $ 2,918,992

Adjustments relating to deferred tax assets — ( 9 ) ( 11 )

Acquisition and measurement period adjustments 1

4,204 592,180 3,983

Goodwill at end of period $ 3,515,135 $ 2,922,964 $ 2,918,992

Goodwill balance at end of period $ 3,519,339 $ 3,515,135 $ 2,922,964

1 The goodwill associated with the ACT and MME acquisitions was allocated to the LTL segment.

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Truckload $ 2,658,086 $ 2,658,086

Logistics 54,827 42,512

LTL 548,322 544,118

Logistics 54,827 54,827

Intermodal 175,594 175,594

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Intangible assets, net $ 1,776,569 $ 1,831,049

1 The major categories of the Company's definite-lived intangible assets include customer relationships, non-compete agreements, internally-developed software, trade names, and others.

1 The Company's definite-lived intangible assets include customer relationships which have a gross carrying amount of $ 1.2 billion as of December 31, 2022 and 2021.

Other categories of the Company's definite-lived intangible assets include non-compete agreements, internally-developed software, trade names, and others.

Identifiable intangible assets subject to amortization have been recorded at fair value.

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Amortization of intangibles $ 64,843 $ 55,299 $ 45,895

As of December 31, 2021, management anticipates that the composition and amount of amortization associated with intangible assets will be $ 64.7 million in 2022, $ 64.2 million for each of the years 2023 and 2024, $ 64.1 million in 2025, and $ 62.7 million in 2026.

As of December 31, 2022, management anticipates that the composition and amount of amortization associated with intangible assets will be $ 64.7 million in for each of the years 2023 and 2024, $ 64.6 million for 2025, $ 63.2 million for 2026, and $ 62.3 million for 2027.

Actual amounts of amortization expense may differ from estimated amounts due to additional intangible asset acquisitions, impairment of intangible assets, accelerated amortization of intangible assets, and other events.

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Self Insurance

Automobile Liability, General Liability, and Excess Liability — Effective November 1, 2020, the Company has $ 100.0 million in excess auto liability ("AL") coverage.

Automobile Liability, General Liability, and Excess Liability — Effective November 1, 2020, the Company has $ 100.0 million in excess auto liability ("AL") coverage subject to aggregate limits.

Effective November 1, 2019, the Company had $ 130.0 million in excess AL coverage.

For prior years, Swift and Knight separately maintained varying excess AL and general liability limits.

During prior policy periods, Swift AL claims were subject to a $ 10.0 million self-insured retention ("SIR") per occurrence and Knight AL claims were subject to a $ 1.0 million to $ 3.0 million SIR per occurrence.

Additionally, Knight carried a $ 2.5 million aggregate deductible for any loss or losses within the $ 5.0 million excess of $ 5.0 million layer of coverage.

Effective March 1, 2020, Knight and Swift retain the same $ 10.0 million SIR per occurrence.

Effective March 1, 2020, Knight and Swift retain the same $ 10.0 million self-insured retention ("SIR") per occurrence.

While Swift AL claims were subject to a $ 10.0 million SIR per occurrence during policy periods prior to March 1, 2020, Knight AL claims were subject to varying SIR limits, including aggregate deductibles, not exceeding $ 10.0 million per occurrence.

Workers' Compensation and Employers' Liability — The Company is self-insured for workers' compensation coverage.

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Medical — Knight maintains primary and excess coverage for employee medical expenses, with a $ 0.4 million SIR per claimant.

Through December 31, 2019, Swift was fully insured on its medical benefits (subject to contributed premiums).

Effective January 1, 2020, Swift provides primary and excess coverage for employee medical expenses, with an SIR of $ 0.5 million per claimant to all employees.

Through December 31, 2019, Swift was fully insured on its medical benefits (subject to contributed premiums).

ACT — ACT maintains SIRs for claims on cargo losses, employee health and welfare, bodily injury and property, general liability and workers’ compensation.

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• Workers' compensation - $ 1.0 million

• Auto liability - $ 2.0 million (ACT maintains a $ 5.0 million annual corridor deductible subject to a $ 10.0 million three-year policy term aggregate cap.)

• Auto liability - Effective March 1, 2022, ACT, retains a $ 10.0 million SIR per occurrence, as compared to the previous policy, which included a $ 2.0 million per occurrence with a $ 5.0 million annual corridor deductible subject to a $ 10.0 million three-year policy term aggregate cap.

• Employee medical - $ 1.0 million.

See Note 2 for accounting policy regarding the Company's claims accruals.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

Third-party Carrier Insurance

Effective during 2020, the Company assumed premiums under a reinsurance agreement covering auto liability, including non-trucking auto liability, cargo and general liability coverages for individual members of an independent carrier safety association.

The per occurrence limits assumed were $ 1.0 million per occurrence for auto liability claims, $ 1.0 million per occurrence for general liability claims, and $ 0.3 million per occurrence for cargo liability claims.

Starting August 2022, the Company began assuming premiums under a reinsurance agreement covering automotive and physical damage with limits of $ 1.0 million per occurrence.

See Note 2 for accounting policy regarding the Company's claims accruals.

Note 13 — Income Taxes

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Computed "expected" tax expense $ 214,306 $ 204,673 $ 117,665

Increase (decrease) in income taxes resulting from:

Increase in income taxes resulting from:

State income taxes, net of federal income tax benefit 32,786 23,063 22,423

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Claims accrual $ 85,573 $ 79,496

Allowance for doubtful accounts 5,530 5,727

Amortization of stock options 8,192 7,712

Unrealized gain/loss on investment 11,815 —

Accrued liabilities 4,112 11,497

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Unrecognized tax benefits at beginning of year $ 1,735 $ 2,950 $ 4,083

Increases for tax positions taken prior to beginning of year — — 38

Decreases for tax positions taken prior to beginning of year — ( 1,215 ) ( 1,133 )

3 unchanged sentences

Management expects a decrease of $ 0.7 million in unrecognized tax benefits during the next twelve months.

Interest and Penalties — Accrued interest and penalties were approximately $ 0.2 million and $ 0.1 million as of December 31, 2022 and December 31, 2021, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

Interest and Penalties — Accrued interest and penalties were approximately $ 0.1 million and $ 0.3 million as of December 31, 2021 and December 31, 2020, respectively.

Tax Examinations — Certain of the Company's subsidiaries are currently under examination by federal and various state jurisdictions for tax years ranging from 2014 to 2020 .

Tax Examinations — Certain of the Company's subsidiaries are currently under examination by federal and state jurisdictions for tax years ranging from 2014 to 2018 .

At the completion of these examinations, management does not expect any adjustments that would have a material impact on the Company's effective tax rate.

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Note 14 — Accounts Receivable Securitization

On April 23, 2021, the Company entered into the 2021 RSA which further amended the 2018 RSA.

On October 3, 2022, the Company entered into the 2022 RSA which further amended the 2021 RSA.

The 2022 RSA is a secured borrowing that is collateralized by the Company's eligible receivables, for which the Company is the servicing agent.

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(Dollars in thousands)

Effective April 23, 2021 July 11, 2018

Final maturity date April 23, 2024 July 9, 2021

Effective date October 3, 2022 April 23, 2021

Final maturity date October 1, 2025 April 23, 2024

Borrowing capacity $ 475,000 $ 400,000

4 unchanged sentences

Program fees on outstanding balances 3

one month LIBOR + 82.5 basis points one month LIBOR + 80 to 100 basis points

one month SOFR + credit adjustment spread 10 basis points + 82.5 basis points one month LIBOR + 82.5 basis points

1 The accordion option increases the maximum borrowing capacity, subject to participation by the purchasers.

2 The 2022 RSA and 2021 RSA commitment fee rates are based on the percentage of the maximum borrowing capacity utilized.

3 Only the rate for the 2018 RSA program fee is subject to the Company's consolidated total net leverage ratio.

4 As identified within the 2021 RSA, the lender can trigger an amendment by identifying and deciding upon a replacement index for LIBOR.

3 As identified within the 2022 RSA and 2021 RSA, the lender can trigger an amendment by identifying and deciding upon a replacement index for SOFR and LIBOR, respectively.

Availability under the 2022 RSA and 2021 RSA is calculated as follows:

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Availability under accounts receivable securitization facilities $ 37,400 $ 55,700

1 As of December 31, 2022 and 2021, outstanding borrowings are included in "Accounts receivable securitization – less current portion" in the consolidated balance sheets and are offset by $ 0.4 million and $ 0.5 million of deferred loan costs, respectively.

Interest accrued on the aggregate principal balance at a rate of 5.1 % and 0.9 %, as of December 31, 2022 and 2021, respectively.

Table of Contents Glossary of Terms

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

1 As of December 31, 2021, outstanding borrowings are included in "Accounts receivable securitization – less current portion" in the consolidated balance sheets and are offset by $ 0.5 million of deferred loan costs.

As of December 31, 2020, outstanding borrowings are included in "Accounts receivable securitization – current portion" in the consolidated balance sheets and are offset by $ 0.1 million of deferred loan costs.

Interest accrued on the aggregate principal balance at a rate of 0.9 % and 1.0 %, as of December 31, 2021 and 2020, respectively.

Program fees and unused commitment fees are recorded in "Interest expense" in the consolidated statements of comprehensive income.

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2021 Term Loan A-2, due September 3, 2024, net 1 2

199,755 199,607

2021 Term Loan A-3, due September 3, 2026, net 1 2

2017 Term Loan, due October 2022, net 1 3

798,705 798,352

Prudential Notes, net 1

35,960 47,265

Other 3,042 5,069

5 unchanged sentences

2021 Revolver, due September 3, 2026 1 3

2017 Revolver, due October 2022 1 5

43,000 260,000

Long-term debt, including revolving line of credit $ 1,080,462 $ 1,509,969

1 Refer to Note 23 for information regarding the fair value of debt.

2 The carrying amounts of the 2021 Term Loan A-2 and 2021 Term Loan A-3 are net of $ 0.2 million and $ 1.3 million in deferred loan costs as of December 31, 2022, respectively.

The carrying amounts of the 2021 Term Loan A-1, 2021 Term Loan A-2, and 2021 Term Loan A-3 are net of $ 0.3 million, $ 0.4 million, and $ 1.6 million in deferred loan costs as of December 31, 2021, respectively.

3 Net of $ 1.1 million in deferred loan costs at December 31, 2020.

4 The Company also had outstanding letters of credit of $ 64.0 million under the 2021 Revolver, primarily related to workers' compensation and self-insurance liabilities, at December 31, 2021.

5 The Company also had outstanding letters of credit of $ 29.3 million under the 2017 Revolver, primarily related to workers' compensation and self-insurance liabilities, at December 31, 2020.

3 The Company also had outstanding letters of credit of $ 15.8 million and $ 64.0 million under the 2021 Revolver, primarily related to workers' compensation and self-insurance liabilities, at December 31, 2022 and December 31, 2021, respectively.

As of December 31, 2022, the Company also had outstanding letters of credit of $ 173.1 million under a separate bilateral agreement which do not impact the availability of the 2021 Revolver.

Table of Contents Glossary of Terms

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1 The interest rate margin for the 2021 Term Loan and 2021 Revolver is based on the Company's consolidated leverage ratio.

As of December 31, 2021, interest accrued at 1.022 % on the 2021 Term Loans and 1.064 % on the 2021 Revolver.

As of December 31, 2022, interest accrued at 4.757 % on the 2021 Term Loan A-2, 4.882 % on the 2021 Term Loan A-3, and 5.074 % on the 2021 Revolver.

2 The commitment fee for the unused portion of the 2021 Revolver is based on the Company's consolidated leverage ratio, and ranges from 0.07 % to 0.20 %.

22 unchanged sentences

As of December 31, 2022 , ACT had $ 90.7 million available under the agreement.

As of December 31, 2022, the Company was in compliance with the covenants under the 2021 Prudential Notes.

See Note 23 for fair value disclosures regarding the Company's debt instruments.

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Revenue equipment leases

Weighted average remaining lease term 1.6 years 4.0 years 2.0 years 3.6 years

Weighted average remaining lease term 1.0 year 3.8 years 1.6 years 4.0 years

Weighted average discount rate 2.3 % 2.6 % 2.3 % 1.9 %

36 unchanged sentences

Depreciation is calculated on a straight-line basis down to the residual value, as applicable, over the estimated useful life of the equipment.

Depreciation expense for these assets was $ 20.6 million for 2021 and 2020.

Depreciation expense for these assets was $ 15.9 million and $ 20.6 million for 2022 and 2021, respectively.

Additionally, the Company periodically leases or subleases out real estate for use by third parties.

28 unchanged sentences

The net pension liability recognized is as follows:

December 31, 2021

(In thousands)

2 unchanged sentences

Unfunded status

$ 1,877 $ 973

Accrued pension liability recognized 1

1 The pension liability is included in "Other long-term liabilities" in the consolidated balance sheets.

"Other comprehensive loss" in the consolidated statements of comprehensive income included a $ 0.6 million loss from pension plan adjustments during 2021.

"Other comprehensive loss" in the consolidated statements of comprehensive income included a $ 2.7 million and $ 0.6 million loss from pension plan adjustments during 2022 and 2021, respectively.

The provisions of the plan do not require compensation levels to be considered in determining the plan’s benefit obligation.

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Benefits paid 2,855 $ 2,981

A weighted-average discount rate of 2.53 % was used to determine benefit obligations as of December 31, 2021.

A weighted-average discount rate of 3.84 % and 2.53 % was used to determine benefit obligations as of December 31, 2022 and December 31, 2021, respectively.

The following weighted-average assumptions were used to determine net periodic pension cost:

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Cash and cash equivalents

Total 100 % 100 %

Pension plan assets

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Debt securities 70 % 70 %

Total 100 % 100 %

The investment policy includes various guidelines and procedures designed to ensure assets are invested in a manner necessary to meet expected future benefit payments.

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Note 18 — Purchase Commitments

As of December 31, 2021, the Company had outstanding commitments to acquire revenue equipment of $ 858.0 million in 2022 ($ 585.8 million of which were tractor commitments), $ 58.6 million in 2023 ($ 50.4 million of which were tractor commitments), and none thereafter.

As of December 31, 2022, the Company had outstanding commitments to acquire revenue equipment of $ 1.0 billion in 2023 ($ 772.1 million of which were tractor commitments) and none thereafter.

These purchases may be financed through any combination of operating leases, finance leases, debt, proceeds from sales of existing equipment, and cash flows from operations.

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Legal Proceedings

Information is provided below regarding the nature, status, and contingent loss amounts, if any, associated with the Company's pending legal matters.

Information is provided below regarding the nature, status, and contingent loss amounts, if any, associated with pending legal matters that may be material to the Company.

There are inherent uncertainties in these legal matters, some of which are beyond management's control, making the ultimate outcomes difficult to predict.

Moreover, management's views and estimates related to these matters may change in the future, as new events and circumstances arise and the matters continue to develop.

The Company has made accruals with respect to its legal matters where appropriate, which are included in

Table of Contents Glossary of Terms

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — CONTINUED

The Company has made accruals with respect to its legal matters where appropriate, which are included in "Accrued liabilities" in the consolidated balance sheets.

"Accrued liabilities" in the consolidated balance sheets.

The Company has recorded an aggregate accrual of approximately $ 11.0 million and $ 18.1 million relating to the Company's outstanding legal proceedings as of December 31, 2022 and 2021, respectively.

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EMPLOYEE COMPENSATION AND PAY PRACTICES MATTERS

CRST Expedited

The plaintiff alleges tortious interference with contract and unjust enrichment related to non-competition agreements entered into with certain of its drivers.

Plaintiff(s) Defendant(s) Date instituted Court or agency currently pending in

CRST Expedited, Inc.

Swift Transportation Co.

of Arizona LLC.

March 20, 2017

United States District Court for the Northern District of Iowa

Recent Developments and Current Status

In July 2019, a jury issued an adverse verdict in this lawsuit.

The court issued a decision granting in part and denying in part certain motions related to the jury’s verdict.

Both parties have appealed the court’s decision.

On August 6, 2021 a three-judge panel of the 8th Circuit Court of Appeals issued an opinion reversing the trial court’s decision.

On October 4, 2021 the 8th Circuit Court of Appeals denied a petition for rehearing.

The likelihood that a loss has been incurred is no longer probable, and the accrual for this lawsuit has accordingly been reversed as of December 31, 2021.

California Wage, Meal, and Rest Class Actions

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Swift Transportation Co., Inc., Interstate Equipment Leasing, Inc., Jerry Moyes, and Chad Killebrew December 22, 2009

Unites States District Court of Arizona and Ninth Circuit Court of Appeals

United States District Court of Arizona and Ninth Circuit Court of Appeals

Recent Developments and Current Status

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1 Individually and on behalf of all others similarly situated.

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Other Environmental

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As of December 31, 2022, the Company's estimate for its total legal liability for all such clean-up and remediation costs was approximately $ 1.3 million in the aggregate for all current and prior year claims.

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Note 20 — Share Repurchase Plans

On May 31, 2019, the Company announced that the Board approved the repurchase of up to $ 250.0 million worth of the Company's outstanding common stock (the "2019 Knight-Swift Share Repurchase Plan").

With the adoption of the 2019 Knight-Swift Share Repurchase Plan, the Company terminated the previous share repurchase plan.

There was approximately $ 0.2 million of authorized purchases remaining under the previous share repurchase plan upon termination.

On November 30, 2020, the Company announced that the Board approved the repurchase of up to $ 250.0 million worth of the Company's outstanding common stock (the "2020 Knight-Swift Share Repurchase Plan").

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There was approximately $ 54.1 million of authorized purchases remaining under the 2019 Knight-Swift Share Repurchase Plan upon termination.

On April 25, 2022, the Company announced that the Board approved the repurchase of up to $ 350.0 million of the Company's outstanding common stock (the "2022 Knight-Swift Share Repurchase Plan").

With the adoption of the 2022 Knight-Swift Share Repurchase Plan, the Company terminated the 2020 Knight-Swift Share Repurchase Plan, which had approximately $ 42.8 million of authorized purchases remaining upon termination.

The following table presents the Company's repurchases of its common stock under the respective share repurchase plans, excluding advisory fees:

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(in thousands)

$ 250,000 — — 4,841 179,585

November 24, 2020 1

$ 250,000 2,821 149,982 1,377 57,175

April 19, 2022 2

$ 350,000 3,180 149,959 — —

1 $ 192.8 million and $ 250.0 million remained available under the 2020 Knight-Swift Share Repurchase Plan as of December 31, 2021 and December 31, 2020, respectively .

Subsequent to December 31, 2021, the Company repurchased 0.7 million shares for $ 36.9 million under the 2020 Knight-Swift Share Repurchase Plan, leaving $ 155.9 million available as of February 22, 2022.

6,001 $ 299,941 1,377 $ 57,175

1 $ 192.8 million remained available under the 2020 Knight-Swift Share Repurchase Plan as of December 31, 2021.

2 $ 200.0 million remained available under the 2022 Knight-Swift Share Repurchase Plan as of December 31, 2022.

Note 21 — Stock-based Compensation

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As of December 31, 2022, the aggregate number of shares remaining available under the 2014 Stock Plan was approximately 4.3 million.

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Legacy Plans — In connection with the 2017 Merger, the registered securities under the Knight Amended and Restated 2003 Stock Option Plan, the Knight 2012 Equity Compensation Plan, the Knight Amended and Restated 2015 Omnibus Incentive Plan, and the Swift 2007 Omnibus Incentive Plan (collectively, the "Legacy Plans") were deregistered.

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See Note 2 regarding the Company's accounting policy for stock-based compensation.

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Stock-based Compensation Expense

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$ 4,201 $ 8,357 $ 4,949

1 Includes awards granted to executive management in November 2019 that, per the original agreement, would ultimately settle in cash upon fulfilling a requisite service period (for restricted stock units) and fulfilling a requisite service period and achieving performance targets (for performance units).

1 Includes awards granted to executive management that, per the original agreement, would ultimately settle in cash upon fulfilling a requisite service period (for restricted stock units) and fulfilling a requisite service period and achieving performance targets (for performance units).

During 2021, the Company amended the agreements for outstanding awards to ultimately settle in shares after each requisite service period.

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Performance units 118,520 112,690 146,036

Equity awards granted 674,711 868,535 691,595

Liability awards granted 1 2

Total stock awards granted 652,827 674,711 868,535

1 Includes 48,556 performance units in 2019.

2 Includes 32,371 restricted stock units in 2019.

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Income tax benefit $ 63 $ 1,304 $ 1,029

The following table is a rollforward of the Company's unvested stock options:

Unvested stock options:

Shares Weighted Average Fair Value

Unvested stock options at December 31, 2020 86,779 $ 6.78

Vested ( 83,707 ) 6.78

Forfeited and canceled ( 3,072 ) 6.78

Unvested stock options at December 31, 2021 — $ —

The total fair value of the shares vested during 2021, 2020, and 2019 was $ 0.6 million, $ 1.0 million, and $ 1.5 million, respectively.

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The total fair value of the shares vested during 2021 and 2020 was $ 0.6 million and $ 1.0 million, respectively.

Restricted Stock Units

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Employees generally forfeit their units if their employment terminates before the vesting date, with the exception of death, disability or retirement.

The following table is a rollforward of unvested restricted stock units, including restricted stock units classified as equity and those classified as liabilities:

The following table is a rollforward of unvested restricted stock units:

Unvested restricted stock units:

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1 The fair value of each restricted stock unit is based on the closing market price on the grant date.

2 Includes 170,280 shares withheld for taxes and 18,697 net units settled in cash which were excluded from the "Common stock issued to employees" activity within the consolidated statements of stockholders' equity.

2 Includes 195,274 shares withheld for taxes which were excluded from the "Common stock issued to employees" activity within the consolidated statements of stockholders' equity.

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Performance Units

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Performance units do not earn dividend equivalents.

The following table is a rollforward of unvested performance units, including performance units classified as equity and those classified as liabilities:

The following table is a rollforward of unvested performance units:

Unvested performance units:

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528,578 $ 49.11

1 Includes 63,815 shares withheld for taxes and 39,225 net units settled in cash which were excluded from the "Common stock issued to employees" activity within the consolidated statements of stockholders' equity.

2 The performance measurement period for performance units granted in 2018 is January 1, 2019 to December 31, 2021 (three full calendar years).

1 Includes 184,297 shares withheld for taxes which were excluded from the "Common stock issued to employees" activity within the consolidated statements of stockholders' equity.

2 The performance measurement period for performance units granted in 2019 is January 1, 2020 to December 31, 2022 (three full calendar years).

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All performance units will vest one month following the expiration of the performance measurement period.

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The following table presents the weighted average assumptions used in the fair value computation for performance units, including performance units classified as equity and those classified as liabilities:

The performance measurement period for units granted in 2022 is January 1, 2023 to December 31, 2025 (three full calendar years).

All performance units will vest one month following the expiration of the performance measurement period.

The following table presents the weighted average assumptions used in the fair value computation for performance units:

Performance unit fair value assumptions:

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5 Since the Monte Carlo Simulation valuation is an open form model that uses an expected life commensurate with the performance period, the expected life of the performance units was assumed to be the period from the grant date to the end of the performance period.

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Non-compensatory Stock Plan:

The Company's 2012 ESPP is administered by the Company, is intended to qualify under Section 423 of the Internal Revenue Code, and is considered noncompensatory.

Pursuant to the 2012 ESPP, the Co mpany is authorized to issue up to 1.4 million shares of its common stock to eligible employees who participate in the plan.

Pursuant to the 2012 ESPP, the Company is authorized to issue up to 1.4 million shares of its common stock to eligible employees who participate in the plan.

Employees are eligible to participate in the 2012 ESPP following at least 90 days of employment with the Company or any of its participating subsidiaries.

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As of December 31, 2022, the Company is authorized to issue an additional 0.9 million shares under the 2012 ESPP.

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Note 22 — Weighted Average Shares Outstanding

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The estimated fair value measurements maximize the use of observable inputs.

However, in situations where there is little, if any, market activity for the asset or liability at the measurement date, the estimated fair value measurement reflects management's own judgments about the assumptions that market participants would use in pricing the asset or liability.

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assumptions that market participants would use in pricing the asset or liability.

These judgments are developed by the Company based on the best information available under the circumstances.

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Pension Plan Assets — The estimated fair value of ACT's pension plan assets are based on quoted prices in active markets that are readily and regularly obtainable.

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Debt Instruments and Leases — For notes payable under the 2021 Revolver, the 2021 Term Loans, the 2021 Prudential Notes, the 2017 Revolver, and the 2017 Term Loan, fair value approximates the carrying value due to the variable interest rate.

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Long-term debt – less current portion 35,960 36,014 47,265 47,354

2021 RSA, due April 2024 4

2022 RSA, due October 2025 4

Accounts receivable securitization

– less current portion 418,561 419,000 — —

Contingent consideration associated with acquisition Accrued liabilities, Other long-term liabilities 13,100 13,100 16,200 16,200

2017 Term Loan, due October 2022 5

Long-term debt – less current portion $ — $ — $ 298,907 $ 300,000

2017 Revolver, due October 2022

Revolving line of credit — — 210,000 210,000

2018 RSA, due July 2021 6

Contingent consideration Accrued liabilities, Other long-term liabilities 4,217 4,217 13,100 13,100

2021 RSA, due April 2024 5

Accounts receivable securitization

– current portion — — 213,918 214,000

– less current portion — — 278,483 279,000

1 Refer to Note 5 for the differences between the carrying amounts and estimated fair values of the Company's restricted investments, held-to-maturity.

2 The carrying amounts of the 2021 Term Loan A-1, 2021 Term Loan A-2, and 2021 Term Loan A-3 are net of $ 0.3 million, $ 0.4 million, and $ 1.6 million in deferred loan costs as of December 31, 2021, respectively.

3 The carrying amount of the 2021 Prudential Notes is net of $0.1 million in deferred loan costs and $ 2.4 million in fair value adjustments as of December 31, 2021 .

2 As of December 31, 2022, the carrying amounts of the 2021 Term Loan A-2 and 2021 Term Loan A-3 are net of $ 0.2 million and $ 1.3 million in deferred loan costs, respectively.

As of December 31, 2021, the carrying amounts of the 2021 Term Loan A-1, 2021 Term Loan A-2, and 2021 Term Loan A-3 are net of $ 0.3 million, $ 0.4 million, and $ 1.6 million in deferred loan costs, respectively.

3 As of December 31, 2022, the carrying amount of the 2021 Prudential Notes is net of $ 0.1 million in deferred loan costs and $ 1.7 million in fair value adjustments.

As of December 31, 2021 , the carrying amount of the 2021 Prudential Notes is net of $ 0.1 million in deferred loan costs and $ 2.4 million in fair value adjustments.

4 The carrying amount of the 2022 RSA is net of $ 0.4 million in deferred loan costs as of December 31, 2022.

5 The carrying amount of the 2017 Term Loan is net of $ 1.1 million in deferred loan costs as of December 31, 2020

5 The carrying amount of the 2021 RSA is net of $ 0.5 million in deferred loan costs as of December 31, 2021 .

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Fair Value Measurements at Reporting Date Using

Estimated Fair Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Unrealized Gain Position

Estimated Fair Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Unrealized Gain (Loss) Position

(In thousands)

As of December 31, 2022

Convertible note 1

Convertible notes 1

$ 11,341 $ — $ — $ 11,341 $ 1,341

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As of December 31, 2021

Convertible notes 1

10,141 — — 10,141 141

Investments in equity securities 2

74,201 74,201 — — 14,456

1 The Company recognized $ 0.1 million of unrealized gains on the convertible note during 2021, which is included within "Other income, net" within the consolidated statements of comprehensive income.

The fair value of the note was determined using a discounted cash flow analysis based on the probability of exit event options and exit event dates.

2 Fair value activity from the investments in equity securities is recorded in "Other income, net" within the consolidated statements of comprehensive income.

During 2021, the Company recognized $ 16.4 million in gains on these investments in equity securities, consisting of $ 10.9 million in unrealized gains and $ 5.5 million in realized gains.

3 Fair value activity from the investments in equity securities is recorded in "Other income, net" within the consolidated statements of comprehensive income.

During 2020, the Company recognized $ 3.7 million in unrealized gains on these investments in equity securities.

1 Convertible notes — The consolidated statements of comprehensive income include the fair value activities from the Company's convertible notes within "Other (expenses) income, net".

The estimated fair value is based on probability-weighted discounted cash flow analysis of the corresponding pay-off/redemption.

During 2022, the Company recognized $ 1.2 million of unrealized gains associated with the $ 10.0 million face value convertible note, discussed above.

During 2021, the Company recognized an unrealized gain on its convertible note with Embark of $ 12.6 million.

2 Investments in equity securities — The consolidated statements of comprehensive income include the fair value activities from the Company's investments in equity securities within "Other (expenses) income, net".

The estimated fair value is based on quoted prices in active markets that are readily and regularly obtainable.

During 2022, the Company recognized a loss of $ 52.6 million, which consisted of $ 64.0 million in unrealized losses, primarily from mark-to-market adjustments of the Company's investment in Embark.

This was partially offset by $ 11.4 million in realized gains from the Company's other investments in equity securities.

During 2021, the Company recognized an $ 16.4 million gain from its investments in equity securities, which consisted of $ 10.9 million in unrealized gains and $ 5.5 million in realized gains from its other equity investments.

Recurring Fair Value Measurements (Liabilities) — The following table depicts the level in the fair value hierarchy of the inputs used to estimate the fair value of liabilities measured on a recurring basis as of December 31, 2022 and 2021.

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As of December 31, 2022

Contingent consideration associated with acquisition 1

Contingent consideration 1

$ 4,217 $ — $ — $ 4,217 $ —

As of December 31, 2021

Contingent consideration associated with acquisition 2

Contingent consideration 1

13,100 — — 13,100 —

1 The Company did no t recognize any gains (losses) during 2021 related to the revaluation of these liabilities.

1 The Company did no t recognize any gains (losses) during 2022 and 2021 related to the revaluation of these liabilities.

Refer to Note 4 for information regarding the components of these liabilities.

2 During the fourth quarter of 2020, the Company increased the estimated fair value of the remaining contingent consideration representing the final two annual payments, resulting in a $ 6.7 million fair value adjustment of the deferred earnout, which was recorded in “Miscellaneous operating expenses” in the consolidated statement of comprehensive income.

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— — — — ( 299 )

1 Reflects the non-cash impairment of building improvements (within the non-reportable segments).

2 Reflects the non-cash impairment of certain revenue equipment held for sale (within the non-reportable segments and the Truckload segment).

2 Reflects the non-cash impairment of certain alternative fuel technology (within the non-reportable segments) and certain revenue equipment held for sale (within the Truckload segment).

The Company recognized $ 5.3 million of impairments during 2020.

Nonrecurring Fair Value Measurements (Liabilities) — As of December 31, 2022 and 2021 there were no liabilities included in the Company's consolidated balance sheets at estimated fair value that were measured on a nonrecurring basis.

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Total pension plan assets $ 52,535 $ 52,535 $ — $ —

As of December 31, 2021

US equity funds $ 14,877 $ 14,877 $ — $ —

International equity funds 6,304 6,304 — —

Fixed income funds 47,873 47,873 — —

Cash and cash equivalents 1,413 1,413 — —

Total pension plan assets $ 70,467 $ 70,467 $ — $ —

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SME Industries 1

— — 56 — 345 —

Total $ — $ — $ — $ — $ 7,893 $ —

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$ — $ — $ — $ — $ 48 $ 277

Other Affiliates 1

Certain affiliates 1

— 284 — 311 11 229

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$ — $ — $ — $ — $ 427 $ —

— — — 33 — 220

Other Affiliates 1

Certain affiliates 1

94 35 31 35 15 35

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1 Entities affiliated with former Board member Jerry Moyes include Central Freight Lines, SME Industries, and DPF Mobile.

"Other affiliates" includes entities that are associated with various board members and executives and require approval by the Board prior to completing transactions.

"Certain affiliates" includes entities that are associated with various board members and executives and require approval by the Board prior to completing transactions.

Transactions with these entities generally include freight services, facility and equipment leases, equipment sales, and other services.

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Receivables and payables pertaining to related party transactions were:

December 31, 2022 December 31, 2021

Receivable Payable Receivable Payable

(In thousands)

Central Freight Lines $ — $ — $ 133 $ —

DPF Mobile — — — 41

Other Affiliates 14 44 2 10

Certain affiliates 1

Total $ 24 $ 39 $ 14 $ 44

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The Company has four reportable segments:

Truckload, Logistics, LTL, and Intermodal, as well as the non-reportable segments, discussed below.

Truckload, LTL, Logistics, and Intermodal, as well as the non-reportable segments, discussed below.

Based on how economic factors affect the nature, amount, timing, and uncertainty of revenue or cash flows, the Company disaggregates revenues by reportable segment for the purposes of applying the ASC 606 guidance.

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The Truckload reportable segment consists of irregular route and dedicated, refrigerated, expedited, flatbed, and cross-border operations.

The Logistics reportable segment is comprised of six logistics operating segments that provide similar transportation services to the Company's customers and primarily consist of brokerage and other freight management services utilizing third-party transportation providers and their equipment.

Our LTL segment, established in 2021 through the ACT and MME acquisitions, is comprised of two operating segments and provides our customers with regional LTL transportation services through a network of approximately 110 service centers in the Company's geographical footprint.

The Company's LTL service also includes national coverage to customers by utilizing partner carriers for areas outside of the Company's direct network.

The Logistics reportable segment is comprised of four logistics operating segments that provide similar transportation services to the Company's customers and primarily consist of brokerage and other freight management services utilizing third-party transportation providers and their equipment.

The Intermodal reportable segment is comprised of two intermodal operating segments that provide similar transportation services to the Company's customers.

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Non-reportable

The non-reportable segments include five operating segments that consist of support services provided to the Company's customers and independent contractors (including repair and maintenance shop services, equipment leasing, warranty services, and insurance), trailer parts manufacturing, warehousing, and certain driving academy activities, as well as certain corporate expenses (such as legal settlements and accruals, certain impairments, and amortization of intangibles related to the 2017 Merger and various acquisitions).

The non-reportable segments include seven operating segments that consist of support services provided to the Company's customers and independent contractors (including repair and maintenance shop services, equipment leasing, warranty services, and insurance), trailer parts manufacturing, warehousing, and certain driving academy activities, as well as certain corporate expenses (such as legal settlements and accruals, certain impairments, and amortization of intangibles related to the 2017 Merger and various acquisitions).

Intersegment Eliminations

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Truckload $ 4,531,115 61.0 % $ 4,098,005 68.3 % $ 3,786,030 81.0 %

Logistics $ 817,003 13.6 % $ 375,841 8.0 % $ 352,988 7.3 %

LTL $ 1,069,554 14.4 % $ 396,308 6.6 % $ — — %

Logistics $ 920,707 12.4 % $ 817,003 13.6 % $ 375,841 8.0 %

Intermodal $ 485,786 6.5 % $ 458,867 7.7 % $ 391,462 8.4 %

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Truckload $ 746,581 68.4 % $ 784,436 81.2 % $ 578,512 102.5 %

Logistics $ 93,920 9.7 % $ 20,245 3.6 % $ 21,869 5.1 %

LTL $ 126,609 11.6 % $ 31,169 3.2 % $ — — %

Logistics $ 133,942 12.3 % $ 93,920 9.7 % $ 20,245 3.6 %

Intermodal $ 48,167 4.4 % $ 42,060 4.4 % $ ( 943 ) ( 0.2 %)

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Truckload $ 453,562 76.2 % $ 422,558 80.9 % $ 390,417 84.7 %

Logistics $ 1,357 0.3 % $ 829 0.2 % $ 728 0.2 %

LTL $ 61,819 10.4 % $ 24,844 4.8 % $ — — %

Logistics $ 2,407 0.4 % $ 1,357 0.3 % $ 829 0.2 %

Intermodal $ 16,727 2.8 % $ 15,345 2.9 % $ 14,377 3.1 %

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Non-reportable segments $ 60,466 10.2 % $ 58,492 11.1 % $ 55,152 12.0 %

Consolidated depreciation and amortization of property and equipment $ 522,596 100.0 % $ 460,775 100.0 % $ 420,082 100.0 %

Depreciation and amortization of property and equipment $ 594,981 100.0 % $ 522,596 100.0 % $ 460,775 100.0 %

Geographical Information

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data