What changed in this filing

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Item 1. Financial Statements

2025-05-13 compared with 2024-10-30 · 132 added, 180 removed, 305 unchanged (51% of the section changed)

4 unchanged sentences

and do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements.

Operating results for the thirty-nine weeks ended September 28, 2024 are not necessarily indicative of the results that may be expected for the entire fiscal year ending December 28, 2024.

Operating results for the thirteen weeks ended March 29, 2025 are not necessarily indicative of the results that may be expected for the entire fiscal year ending December 27, 2025.

These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s 2024 Annual Report on Form 10-K.

3 unchanged sentences

(Dollars in thousands, except per share amounts)

September 28,

Current Assets

13 unchanged sentences

Dividends payable

Contractor escrow

Other current liabilities

17 unchanged sentences

(Dollars in thousands, except per share amounts)

Thirty-Nine Weeks Ended

Thirteen Weeks Ended

September 28,

September 30,

September 28,

September 30,

Investment income

18 unchanged sentences

(Dollars in thousands)

Thirty-Nine Weeks Ended

Thirteen Weeks Ended

September 28,

September 30,

September 28,

September 30,

Other comprehensive (loss) income:

Other comprehensive income (loss):

Unrealized holding gains on available-for-sale

investments, net of tax expense of $ 828 ,

$ 263 , $ 624 and $ 49

Foreign currency translation (losses) gains

Other comprehensive (loss) income

investments, net of tax expense of $ 264 and $ 92

Foreign currency translation gains (losses)

Other comprehensive income

Comprehensive income

4 unchanged sentences

(Dollars in thousands)

Thirty-Nine Weeks Ended

September 28,

September 30,

Thirteen Weeks Ended

OPERATING ACTIVITIES

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Changes in operating assets and liabilities:

Decrease in trade and other accounts receivable

Increase in other assets

(Increase) decrease in trade and other accounts receivable

Decrease in other assets

Increase (decrease) in accounts payable

Decrease in other liabilities

Increase in other liabilities

Increase (decrease) in insurance claims

5 unchanged sentences

Proceeds from sales of operating property

NET CASH USED BY INVESTING ACTIVITIES

NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES

FINANCING ACTIVITIES

1 unchanged sentence

Dividends paid

Proceeds from exercises of stock options

Taxes paid in lieu of shares issued related to stock-based compensation plans

3 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents

(Decrease) increase in cash and cash equivalents

Decrease in cash and cash equivalents

Cash and cash equivalents at beginning of period

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

Thirty-Nine and Thirteen Weeks Ended September 28, 2024 and September 30, 2023

Thirteen Weeks Ended March 29, 2025 and March 30, 2024

(Dollars in thousands)

4 unchanged sentences

Dividends ($ 0.36 per share)

Issuance of stock related to stock-based compensation plans

Stock-based compensation

Other comprehensive income

Balance March 30, 2024

Dividends ($ 0.33 per share)

Purchases of common stock

1 unchanged sentence

Stock-based compensation

Other comprehensive loss

Balance June 29, 2024

Dividends ($ 0.36 per share)

Purchases of common stock

Issuance of stock related to stock-based compensation plans

Stock-based compensation

Other comprehensive income

Balance September 28, 2024

Balance March 29, 2025

Treasury Stock at Cost

3 unchanged sentences

Dividends ($ 0.33 per share)

Purchases of common stock

Issuance of stock related to stock-based compensation plans

1 unchanged sentence

Other comprehensive income

Balance April 1, 2023

Dividends ($ 0.30 per share)

Issuance of stock related to stock-based compensation plans

Stock-based compensation

Other comprehensive income

Balance July 1, 2023

Dividends ($ 0.33 per share)

Issuance of stock related to stock-based compensation plans

Stock-based compensation

Other comprehensive loss

Balance September 30, 2023

Balance March 30, 2024

See accompanying notes to consolidated financial statements.

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Revenue from Contracts with Customers – Disaggregation of Revenue

The following table summarizes (i) the percentage of consolidated revenue generated by mode of transportation and (ii) the total amount of truck transportation revenue hauled by BCO Independent Contractors and Truck Brokerage Carriers generated by equipment type during the thirty-nine-week and thirteen-week periods ended September 28, 2024 and September 30, 2023 (dollars in thousands):

Thirty-Nine Weeks Ended

The following table summarizes (i) the percentage of consolidated revenue generated by mode of transportation and (ii) the total amount of truck transportation revenue hauled by BCO Independent Contractors and Truck Brokerage Carriers generated by equipment type during the thirteen-week periods ended March 29, 2025 and March 30, 2024 (dollars in thousands):

Thirteen Weeks Ended

September 28,

September 30,

September 28,

September 30,

Truck – BCO Independent Contractors

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Share-based Payment Arrangements

of September 28, 2024, the Company has an employee equity incentive plan, the 2011 equity incentive plan (the “2011 EIP”).

As of March 29, 2025, the Company has an employee equity incentive plan, the 2011 equity incentive plan (the “2011 EIP”).

The Company also has a stock compensation plan for members of its Board of Directors, the 2022 Directors Stock Compensation Plan (the “2022 DSCP”).

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The 2011 EIP and 2022 DSCP are each referred to herein as a “Plan,” and, collectively, as the “Plans.” Amounts recognized in the financial statements with respect to these Plans are as follows (in thousands):

Thirty-Nine Weeks Ended

Thirteen Weeks Ended

September 28,

September 30,

September 28,

September 30,

Total cost of the Plans during the period

1 unchanged sentence

Net cost of the Plans during the period

Included in income tax benefits recognized in the thirty-nine-week periods ended September 28, 2024 and September 30, 2023 were excess tax benefits from stock-based awards of $ 1,122,000 and $ 2,830,000 , respectively.

As of September 28, 2024, there were 181,450 shares of the Company’s common stock reserved for issuance under the 2022 DSCP and 2,800,060 shares of the Company’s common stock reserved for issuance under the 2011 EIP.

Included in income tax benefits recognized in the thirteen-week periods ended March 29, 2025 and March 30, 2024 were tax deficiencies (excess tax benefits) from stock-based awards of $

51,000 and ($ 729,000 ), respectively.

As of March 29, 2025, there were 181,450 shares of the Company’s common stock reserved for issuance under the 2022 DSCP and 2,671,437 shares of the Company’s common stock reserved for issuance under the 2011 EIP.

Restricted Stock Units

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Outstanding at December 28, 2024

Shares earned in excess of target (1)

Vested shares

Outstanding at September 28, 2024

Represents additional shares earned under the April 24, 2018 and July 1, 2019 RSU awards as total shareholder return during the applicable performance period exceeded target performance level under each of those awards.

During the thirty-nine-week period ended September 28, 2024, the Company granted RSUs with a performance condition and RSUs with a market condition, as further described below.

Outstanding RSUs at both December 30, 2023 and September 28, 2024 include RSUs with a performance condition and RSUs with a market condition, as further described below and in the Company’s 2023 Annual Report on Form 10-K.

RSUs with a performance condition granted on February 2, 2024 may vest on January 31 of 2027, 2028 and 2029 based on growth in operating income and pre-tax

Outstanding at March 29, 2025

During the thirteen-week period ended March 29, 2025, the Company granted RSUs with a performance condition and RSUs with a market condition, as further described below.

Outstanding RSUs at both December 28, 2024 and March 29, 2025 include RSUs with a performance condition and RSUs with a market condition, as further described below and in the Company’s 2024 Annual Report on Form 10-K.

RSUs with a performance condition granted on January 31, 2025 and February 3, 2025 may vest on January 31 of 2028, 2029 and 2030 based on growth in operating income and pre-tax

income per diluted share from continuing operations as compared to the results from the 2024 fiscal year.

On February 2, 2024, the Company granted 58,268 RSUs that vest based on a market condition.

On January 31, 2025, the Company granted 6,050 RSUs that vest based on a market condition.

These RSUs may vest based on the achievement of the target Company’s total shareholder return (“TSR”) compound annual growth rate, adjusted to reflect dividends (if any) paid during such periods and capital adjustments as may be necessary, and are eligible to vest annually starting after the sixth anniversary of the grant date and concluding after the tenth anniversary of the grant date.

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Previously recognized compensation cost would be reversed only if the employee did not complete the requisite service period due to termination of employment.

The Company recognized approximately $ 408,000 and $ 1,503,000 of share-based compensation expense related to RSU awards in the thirty-nine-week periods ended September 28, 2024 and September 30, 2023, respectively.

As of September 28, 2024, there was a maximum of $ 40.7 million of total unrecognized compensation cost related to RSU awards granted under the Plans with an expected average remaining life of approximately 3.6 years.

The Company recognized approximately $ 857,000 and $ 632,000 of share-based compensation expense related to RSU awards in the thirteen-week periods ended March 29, 2025 and March 30, 2024, respectively.

As of March 29, 2025, there was a maximum of $ 53.3 million of total unrecognized compensation cost related to RSU awards granted under the Plans with an expected average remaining life of approximately 3.5 years.

With respect to RSU awards with a performance condition, the amount of future compensation expense to be recognized will be determined based on future operating results.

3 unchanged sentences

Number of Shares

and Deferred Stock

Weighted Average

at December 28, 2024

at September 28, 2024

at March 29, 2025

The fair value of each share of non-vested

6 unchanged sentences

However, Deferred Stock Units do contain the right to receive dividend equivalent payments prior to settlement into shares.

As of September 28, 2024, there was $ 5,754,000 of total unrecognized compensation cost related to non-vested

As of March 29, 2025, there was $ 7,119,000 of total unrecognized compensation cost related to non-vested

shares of restricted stock and Deferred Stock Units granted under the Plans.

1 unchanged sentence

shares of restricted stock and Deferred Stock Units is expected to be recognized over a weighted average period of 2.2 years.

Stock Options

The Company had no issued and outstanding vested or unvested stock options or unrecognized compensation costs related to non-vested

stock options granted under the Plans as of December 30, 2023 or September 28, 2024.

The total intrinsic value of stock options exercised during the thirty-nine-week period ended September 30, 2023 was $ 218,000 .

(3) Income Taxes

provisions for income taxes for the 2024 and 2023 thirty-nine-week periods were based on estimated annual effective income tax rates of 24.3 % and 24.4 %, respectively, adjusted for discrete events, such as benefits resulting from stock-based awards.

The effective income tax rate for the 2024 thirty-nine-week period was 23.4 %.

The effective income tax rate was higher than the statutory federal income tax rate of 21 % in the 2024 period primarily attributable to state taxes, partially offset by federal tax credits.

The effective income tax rate for the 2023 thirty-nine-week period was 24.0 %.

The provisions for income taxes for the 2025 and 2024 thirteen-week periods were based on estimated annual effective income tax rates of 24.3 % and 24.5 %, respectively, adjusted for discrete events, such as benefits resulting from stock-based awards.

The effective income tax rate for the 2025 thirteen-week period was 24.7 %.

The effective income tax rate was higher than the statutory federal income tax rate of 21 % in the 2025 period primarily attributable to state taxes.

The effective income tax rate for the 2024 thirteen-week period was 23.5 %.

The effective income tax rate was higher than the statutory federal income tax rate of 21 % in the 2024 period primarily attr ibut

able to state taxes.

Earnings Per Share

earnings per common share are based on the weighted average number of shares outstanding, which includes outstanding non-vested

Basic earnings per common share are based on the weighted average number of shares outstanding, which includes outstanding non-vested

restricted stock and outstanding Deferred Stock Units.

Diluted earnings per share are based on the weighted average number of common shares outstanding plus the incremental shares that would have been outstanding upon the assumed exercise of all dilutive stock options.

For each of the thirty-nine-week and thirteen-week periods ended September 28, 2024 and September 30, 2023, the weighted-average number of common shares outstanding is the same for purposes of the calculations of both basic and diluted earnings per share.

During and as of the thirty-nine-week period ended September 28, 2024, there were no outstanding stock options issued by the Company.

For the thirty-nine-week period ended September 30, 2023, the impact on earnings per share of future compensation expense related to outstanding, unvested time-based awards was greater than the incremental impact of outstanding dilutive stock options, and would therefore have an anti-dilutive effect on earnings per share if included in the calculation of earnings per share.

Accordingly, the Company had no reconciling items between the average number of common shares outstanding used to calculate basic earnings per common share and the average number of common shares and common share equivalents outstanding used to calculate diluted earnings per share during each of the 2024 and 2023 thirty-nine-week and thirteen-week periods.

Outstanding RSUs were excluded from the calculation of diluted earnings per share for all periods because the performance metric requirements or market condition for vesting had not been

Diluted earnings per share are based on the weighted average number of common shares outstanding plus the dilutive effect of outstanding stock awards, if applicable.

Outstanding RSUs were excluded from the calculation of diluted earnings per share for all periods because the performance metric requirements or market condition for vesting had not been satisfied.

Additional Cash Flow Information

nine -week period, Landstar paid income taxes and interest of $

45,638,000 and $

2,641,000 , respectively.

nine -week period, Landstar paid income taxes and interest of $

68,136,000 and $

2,814,000 , respectively.

During the 2025 thirteen-week period, Landstar paid income taxes and interest of $ 480,000 and $ 1,446,000 , respectively.

During the 2024 thirteen-week period, Landstar received income tax refunds, net of income tax payments, of $ 495,000 and paid interest of $ 825,000 .

Landstar did not acquire any operating property by entering into finance leases in the 2025 thirteen-week period.

Landstar acquired operating property by entering into finance leases in the amount of $

24,238,000 in the

nine -week period.

Landstar acquired $

6,690,000 of operating property for which the Company accrued a corresponding liability in accounts payable of $

1,201,000 and in other noncurrent liabilities of $

5,489,000 as of September

Landstar did not acquire any operating property by entering into finance leases in the

nine -week period.

nine -week period, the Company purchased its common stock at a total cost of $

1,325,000 in the 2024 thirteen-week period.

During the 2025 thirteen-week period, the Company purchased its common stock at a total cost of $

60,945 ,000, including $

78,697 ,000 in cash purchases and accrued excise tax of $

691,000 , which is included in other current liabilities in the consolidated balance sheet at September

60,361 ,000 in cash purchases and acc

ued excise tax of $

which is included in other current liabilities in the consolidated balance sheet at March 29, 2025.

During the 2024 thirteen-week period, the Company did not purchase any shares of its common stock.

Segment Information

The following

table summarizes information about the Company’s reportable business segments

as of and for the thirty-

nine -week and

thirteen -week periods ended September

2024 and September

2023 (in thousands):

Thirty-Nine Weeks Ended

September 28, 2024

September 30, 2023

Transportation

The Company reports the results of two operating segments:

the transportation logistics segment and the insurance segment.

The Company’s chief

operating decision maker (“CODM”) is our Chief Executive Officer.

The CODM evaluates each segment’s performance and makes decisions about resource allocations primarily based on operating income, which is the principal financial metric utilized to monitor budgeted versus actual results by segment of the Company.

Asset information by segment is not typically provided to the CODM for purposes of evaluating performance or allocating resources, and therefore such information has not been presented.

The following tables summarize information about the Company’s reportable business segments as of and for the thirteen-week periods ended March 29, 2025 and March 30, 2024 (in thousands):

Transportation

1 unchanged sentence

Internal revenue

Total revenue

Investment income

Purchased transportation

Commissions to agents

Other operating costs, net of gains on asset sales/dispositions

Insurance and claims

Selling, general and administrative

Depreciation and amortization

Operating income

Expenditures on long-lived assets

Thirteen Weeks Ended

September 28, 2024

September 30, 2023

Transportation

External revenue

Internal revenue

Total revenue

Investment income

Purchased transportation

Commissions to agents

Other operating costs, net of gains on asset sales/dispositions

Insurance and claims

Selling, general and administrative

Depreciation and amortization

Operating income

Expenditures on long-lived assets

In the thirty-nine-week periods ended September 28, 2024 and September 30, 2023, no single customer accounted for more than 10 % of the Company’s consolidated revenue.

Thirteen Weeks Ended

Operating income

Interest and debt (income) expense (1)

Income before income taxes

Interest and debt (income) expense includes (i) interest income earned on cash balances held by the transportation logistics segment of $ 1,668 and $ 2,500 in the 2025 and 2024 thirteen-week periods, respectively and (ii) consolidated total interest expense of $ 1,509 and $ 889 in the 2025 and 2024 thirteen-week periods, respectively

In the thirteen-week periods ended March 29, 2025 and March 30, 2024, no single customer acco u

nted for more than 10 % of the Company’s consolidated revenue.

Other Comprehensive Income

following table presents the components

of and changes in accumulated other comprehensive (loss) income, net of related income taxes, as of and for the thirty-nine-week period ended September 28, 2024 (in thousands):

The following

table presents the components of and changes in accumulated other comprehensive (loss) income, net of related income taxes, as of and for the thirteen-week period ended March 29, 2025 (in thousands):

Holding (Losses)

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Balance as of December 28, 2024

Other comprehensive income (loss)

Balance as of September 28, 2024

Amounts reclassified from accumulated other comprehensive income to investment income due to the realization of previously unrealized gains and losses in the accompanying consolidated statements of income were not significant for the thirty-nine-week period ended September 28, 2024.

(8) Investments

include primarily investment-grade corporate bonds, asset-backed securities and commercial paper having maturities of up to five years (the “bond portfolio”) and money market investments.

Other comprehensive income

Balance as of March 29, 2025

Investments include primarily investment-grade corporate bonds, asset-backed securities, commercial paper and U.S.

treasury obligations having maturities of up to five years (the “bond portfolio”) and money market investments.

Investments in the bond portfolio are reported as available-for-sale

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investments to determine whether an allowance for credit loss is necessary.

Unrealized losses, representing the excess of the purchase price of an investment over its fair value as of the end of a period, considered to be a result of credit-related factors, are to be included as a charge in the statements of income, while unrealized losses considered to be a result of non-credit-related

Unrealized losses, representing the excess of the purchase price of an investment over its fair value as of the end of a period, considered to be a result of credit-related factors, are to be included as a charge in the statement of income, while unrealized losses considered to be a result of non-credit-related

factors are to be included as a component of shareholders’ equity.

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Any transfers between levels are recognized as of the beginning of any reporting period.

Fair value of the bond portfolio was determined using Level 1 inputs related to money market investments and Level 2 inputs related to investment-grade corporate bonds, asset-backed securities, commercial paper and direct obligations of government agencies.

Unrealized losses, net of unrealized gains, on the investments in the bond portfolio

were $ 2,531,000 and $ 6,382,000 at September 28, 2024 and December 30, 2023, respectively.

Fair value of the bond portfolio was determined using Level 1 inputs related to U.S.

Treasury obligations and money market investments and Level 2 inputs related to investment-grade corporate bonds, asset-backed securities, commercial paper and direct obligations of government agencies.

Unrealized losses, net of unrealized gains, on the investments in the bond portfolio were $ 2,345,000 and $ 3,573,000 at March 29, 2025 and December 28, 2024, respectively.

The amortized cost and fair values of available-for-sale

investments are as follows at September 28, 2024 and December 30, 2023 (in thousands):

September 28, 2024

investments are as follows at March 29, 2025 and December 28, 2024 (in thousands):

March 29, 2025

Money market investments

Asset-backed securities

Corporate bonds, commercial paper and direct obligations of government

Corporate bonds, commercial paper and direct obligations of government agencies

Treasury obligations

December 28, 2024

1 unchanged sentence

Asset-backed securities

Corporate bonds, commercial paper and direct obligations of government

Treasury obligations

For those available-for-sale

investments with unrealized losses at September 28, 2024 and December 30, 2023, the following table summarizes the duration of the unrealized loss (in thousands):

Corporate bonds, commercial paper and direct obligations of government agencies

For those available

investments with unrealized losses at March 29, 2025 and December 28, 2024, the following table summarizes the duration of the unrealized loss (in thousands):

Less than 12 months

12 months or longer

September 28, 2024

March 29, 2025

Asset-backed securities

3 unchanged sentences

Corporate bonds, commercial paper, and direct obligations of government agencies

Treasury obligations

The Company believes unrealized losses on investments were primarily caused by rising interest rates rather than changes in credit quality.

The Company expects to recover, through collection of all of the contractual cash flows of each security, the amortized cost basis of these securities as it does not intend to sell, and does not anticipate being required to sell, these securities before recovery of the cost basis.

For these reasons, no losses have been recognized in the Company’s consolidated statements of income.

noncancelable leases are primarily comprised of finance leases for the acquisition of new trailing equipment.

For these reasons, no losses have been recognized

in the Company’s consolidated statements of income.

Landstar’s noncancelable leases are primarily comprised of finance leases for the acquisition of new trailing equipment.

Each finance lease for the acquisition of trailing equipment is a five year lease with a $ 1 purchase option for the applicable equipment at lease expiration.

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therefore, based on the applicable lease terms and the current economic environment, the Company applies a portfolio approach for determining the incremental borrowing rate.

The components of lease cost for finance leases and operating leases for the thirty-nine weeks ended September 28, 2024 were (in thousands):

The components of lease cost for finance leases and operating leases for the thirteen weeks ended March 29, 2025 were (in thousands):

Finance leases:

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Total net lease cost

A summary of the lease classification on the Company’s consolidated balance sheet as of September 28, 2024 is as follows (in thousands):

A summary of the lease classification on the Company’s consolidated balance sheet as of March 29, 2025 is as follows (in thousands):

Operating lease right-of-use

Finance lease assets

Operating property, less accumulated

depreciation and amortization

Operating property, less accumulated depreciation and amortization

Total lease assets

The following table reconciles the undiscounted cash flows for the finance and operating leases to the finance and operating lease liabilities recorded on the balance sheet at September 28, 2024 (in thousands):

The following table reconciles the undiscounted cash flows for the finance and operating leases to the finance and operating lease liabilities recorded on the balance sheet at March 29, 2025 (in thousands):

2025 Remainder

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Deferred income taxes and other noncurrent liabilities

The weighted average remaining lease term and the weighted average discount rate for finance and operating leases as of September 28, 2024 were:

average remaining lease term and the weighted average discount rate for finance and operating leases as of March 29, 2025 were:

Finance Leases

2 unchanged sentences

Weighted average discount rate

than the finance lease obligations as presented on the consolidated balance sheets, the Company had no outstanding debt as of September 28, 2024 and December 30, 2023.

Other than the finance lease obligations as presented on the consolidated balance sheets, the Company had no outstanding debt as of March 29, 2025 and December 28, 2024.

On July 1, 2022 , Landstar entered into a second amended and restated credit agreement with a bank syndicate led by JPMorgan Chase Bank, N.A., as administrative agent (as further amended as of June 21, 2024, the “Credit Agreement”).

1 unchanged sentence

The Credit Agreement also includes an “accordion” feature providing for a possible increase of up to an aggregate amount of borrowing capacity of $ 600,000,000 .

As of September 28, 2024, the Company had no borrowings outstanding under the Credit Agreement.

As of March 29, 2025, the Company had no borrowings outstanding under the Credit Agreement.

The revolving credit loans under the Credit Agreement, at the option of Landstar, bear interest at (i) a forward-looking term rate based on the secured overnight financing rate plus 0.10 % and an applicable margin ranging from 1.25 % to 2.00 %, or (ii) an alternate base rate plus an applicable margin ranging from 0.25 % to 1.00 %, in each case with the applicable margin determined based upon the Company’s Leverage Ratio, as defined in the Credit Agreement, at the end of the most recent applicable fiscal quarter for which financial statements have been delivered.

3 unchanged sentences

The Credit Agreement provides for a restriction on cash dividends and other distributions to stockholders on the Company’s capital stock to the extent there is a default under the Credit Agreement.

In addition, the Credit Agreement under certain circumstances limits the amount of such cash dividends and other distributions to stockholders to the extent that, after giving effect to any payment made to effect such cash dividend or other distribution, the Leverage Ratio would exceed 2.5

to 1 on a pro forma basis as of the end of the Company’s most recently completed fiscal quarter.

The Credit Agreement provides for an event of default in the event that, among other things, a person or group acquires 35 % or more of the outstanding capital stock of the Company or obtains power to elect a majority of the Company’s directors or the directors cease to consist of a majority of Continuing Directors, as defined in the Credit Agreement.

3 unchanged sentences

Interest rates on borrowings under finance leases approximate the interest rates that would currently be available to the Company under similar terms and, as such, carrying value approximates fair value.

(11) Commitments and Contingencies

investments include $ 62,451,000 in current maturities of investments held by the Company’s insurance segment at September 28, 2024.

and Contingencies

Short-term investments include $ 56,016,000 in current maturities of investments held by the Company’s insurance segment at March 29, 2025.

The non-current

2 unchanged sentences

investments, provide collateral for the $ 74,321,000 of letters of credit issued to guarantee payment of insurance claims.

As of September 28, 2024, Landstar also had $ 35,250,000 of additional letters of credit outstanding under the Company’s Credit Agreement.

The Company is involved in certain claims and pending litigation arising from the normal conduct of business.

As of March 29, 2025, Landstar also had $ 35,250,000 of additional letters of credit outstanding under the Company’s Credit Agreement.

is involved in certain claims and pending litigation arising from the normal conduct of business.

Many of these claims are covered in whole or in part by insurance.

1 unchanged sentence

Change in Accounting Estimate for Self-Insured Claims

provides for the estimated costs of self-insured claims primarily on an actuarial basis.

Landstar provides for the estimated costs of self-insured claims primarily on an actuarial basis.

The amount recorded for the estimated liability for claims incurred is based upon the facts and circumstances known on the applicable balance sheet date.

2 unchanged sentences

Historically, the Company has experienced both favorable and unfavorable development of prior years’ claims estimates within its various programs.

The following table summarizes the adverse effect of the increase in the cost of insurance claims resulting from unfavorable development of prior year self-insured claims estimates on operating income, net income and basic and diluted earnings per share set forth in the consolidated statements of income for the thirty-nine-week and thirteen-week periods ended September 28, 2024 and September 30, 2023 (in thousands, except per share

Thirty-Nine Weeks Ended

The following table summarizes the adverse effect of the increase in the cost of insurance claims resulting from unfavorable development of prior year self-insured claims estimates on operating income, net income and basic and diluted earnings per share set forth in the consolidated statements of income for the thirteen-week periods ended March 29, 2025 and March 30, 2024 (in thousands, except per share amounts):

Thirteen Weeks Ended

September 28,

September 30,

September 28,

September 30,

Operating income

Basic and diluted earnings per share

The unfavorable development of prior years’ claims during the thirteen-week period ended March 29, 2025 was primarily attributable to elevated cargo loss experience as a result of fraud and theft in the supply chain and several specific commercial trucking claims.

Recent Accounting Pronouncements

Accounting Standards Issued But Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07,

Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures

(“ASU 2023-07”),

which expands disclosures about a public entity’s reportable segments and requires more enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how a public entity’s chief operating decision maker uses reported segment profit or loss information in assessing segment performance and allocating resources.

is effective for annual periods beginning after December 15, 2023.

The Company expects ASU 2023-07

to impact only its disclosures with no impacts to its financial condition, results of operations or cash flows.

In December 2023, the FASB issued ASU 2023-09,

6 unchanged sentences

is not expected to have a material impact on the Company’s consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03,

Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses

(“ASU 2024-03”),

which expands disclosures about certain categories of expenses.

is effective for annual periods beginning after December 15, 2026.

The Company is currently evaluating the impact of ASU 2024-03

on its consolidated financial statements and disclosures.

Supply Chain Fraud Matter

During the last week of the Company’s 2025 first quarter, the Company identified a supply chain fraud relating to the Company’s international freight forwarding operations.

This supply chain fraud matter does not involve the Company’s core North American truckload services.

In connection with this supply chain fraud matter, consolidated revenue and purchased transportation as reported in the Company’s fiscal year 2024, 2023 and 2022 financial results were each overstated by approximately 2 %, 1 %, and less than 0.5 %, respectively.

As the overstated amount of revenue was approximately equal to the overstated amount of purchased transportation, the impact on each of operating income and net income, as reported, was less than 1 % in fiscal year 2024 and less than 0.2 % in fiscal years 2023 and 2022, respectively.

The Company has performed a quantitative and qualitative analysis of the impact of this supply chain fraud matter in respect of the 2025 first quarter and the financial statements for each prior fiscal year period during which identified instances of fraud relating to this matter occurred.

In connection therewith, the Company concluded that such impact was immaterial with respect to each such fiscal period.

While remediation and collection efforts continue, the Company’s 2025 first quarter financial results included a

$ 4.8 million

$ 0.10 per basic and diluted share, relating to this matter.

This expense reflects the total currently anticipated aggregate adverse financial impact to Landstar relating to the fraud, net of certain actual and anticipated recoveries and before taking into account the cost of legal and other professional fees as well as additional potential recoveries in the future.

This expense is reflected in 2025 first quarter selling, general & administrative costs as an increase to the provision for customer bad debt expense, resulting in an increase in the allowance for doubtful accounts related to trade accounts receivable.

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-Q

Item 1. Financial Statements