What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-06 compared with 2026-05-08 · 200 added, 67 removed, 458 unchanged (37% of the section changed)

28 unchanged sentences

192,000,000 shares authorized;

81,589,135 shares at March 31, 2026, and 81,542,174 shares at December 31, 2025, issued and outstanding

81,661,669 shares at June 30, 2026, and 81,542,174 shares at December 31, 2025, issued and outstanding

Additional paid-in capital

5 unchanged sentences

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

Ended March 31,

Ended June 30,

(In thousands, except per share information)

29 unchanged sentences

Dividends on common stock, $ 0.06 per share

Balance at June 30, 2026

The accompanying notes are an integral part of these consolidated condensed financial statements.

MARTEN TRANSPORT, LTD.

CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS ’ EQUITY

(In thousands)

Balance at December 31, 2024

4 unchanged sentences

Balance at March 31, 2025

Issuance of common stock from share-based payment arrangement exercises

Share-based payment arrangement compensation expense

Dividends on common stock, $ 0.06 per share

Balance at June 30, 2025

The accompanying notes are an integral part of these consolidated condensed financial statements.

1 unchanged sentence

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

Ended March 31,

Ended June 30,

(In thousands)

11 unchanged sentences

Net cash provided by operating activities

Cash flows used for investing activities:

Cash flows provided by/(used for) investing activities:

Revenue equipment additions

2 unchanged sentences

Proceeds from buildings and land, office equipment and other dispositions

Net cash used for investing activities

Net cash provided by/(used for) investing activities

Cash flows used for financing activities:

10 unchanged sentences

Operating lease assets and liabilities acquired

Supplemental disclosure of cash flow information:

Cash paid for income taxes

Reconciliation of cash and cash equivalents and escrow deposit in the consolidated condensed balance sheets:

5 unchanged sentences

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2026

SIX MONTHS ENDED JUNE 30, 2026

(1) Consolidated Condensed Financial Statements

7 unchanged sentences

Basic and diluted earnings per common share were computed as follows:

Ended March 31,

Ended June 30,

(In thousands, except per share amounts)

4 unchanged sentences

Diluted earnings per common share

Options totaling 572,100 and 605,371 equivalent shares were outstanding but were not included in the calculation of diluted earnings per share for the three-month periods ended March 31, 2026 and March 31, 2025, respectively, because including the options in the denominator would be antidilutive, or decrease the number of weighted-average shares, due to their exercise prices exceeding the average market price of the common shares, or because inclusion of average unrecognized compensation expense in the calculation would cause the options to be antidilutive.

Unvested performance awards totaling 108,512 and 114,276 equivalent shares for the three-month periods ended March 31, 2026 and March 31, 2025, respectively, were considered outstanding but were not included in the calculation of diluted earnings per share because inclusion of average unrecognized compensation expense in the calculation would cause the performance awards to be antidilutive.

Options totaling 489,600 and 563,300 equivalent shares for the three-month and six-month periods ended June 30, 2026, respectively, and 638,071 and 615,898 equivalent shares for the three-month and six-month periods ended June 30, 2025, respectively, were outstanding but were not included in the calculation of diluted earnings per share because including the options in the denominator would be antidilutive, or decrease the number of weighted-average shares, due to their exercise prices exceeding the average market price of the common shares, or because inclusion of average unrecognized compensation expense in the calculation would cause the options to be antidilutive.

Unvested performance awards totaling 168,978 equivalent shares for each of the three-month and six-month periods ended June 30, 2026, and 181,111 equivalent shares for each of the three-month and six-month periods ended June 30, 2025, were considered outstanding but were not included in the calculation of diluted earnings per share because inclusion of average unrecognized compensation expense in the calculation would cause the performance awards to be antidilutive.

(3) Long-Term Debt

1 unchanged sentence

The credit agreement amends, restates and continues in its entirety our previous credit agreement, as amended.

At March 31, 2026, there was no outstanding principal balance on the facility.

In June 2026, the credit agreement was amended to increase the aggregate principal amount to $ 35.0 million.

At June 30, 2026, there was no outstanding principal balance on the facility.

As of that date, we had outstanding standby letters of credit to guarantee settlement of self-insurance claims of $ 33.2 million and remaining borrowing availability of $ 1.8 million.

2 unchanged sentences

This facility bears interest at a variable rate based on the Term SOFR Rate plus applicable margins.

The interest rate for the facility that would apply to outstanding principal balances was 6.75 % at March 31, 2026.

The interest rate for the facility that would apply to outstanding principal balances was 6.75 % at June 30, 2026.

Our credit agreement effective in August 2022 prohibits us from paying, in any fiscal year, stock redemptions and dividends in excess of $ 150 million.

The credit agreement also contains restrictive covenants which, among other matters, require us to maintain compliance with cash flow leverage and fixed charge coverage ratios.

We were in compliance with all covenants at March 31, 2026 and December 31, 2025.

We were in compliance with all covenants at June 30, 2026 and December 31, 2025.

(4) Related Party Transactions

We purchase tires and obtain related services from a company in which one of our directors is the chairman of the board and chief executive officer.

We paid that company $ 40,000 in the first three months of 2026 and $ 100 in the first three months of 2025 for tires and related services.

In addition, we paid $ 289,000 in the first three months of 2026 and $ 166,000 in the first three months of 2025 to tire manufacturers for tires that were provided by the same company.

We paid that company $ 48,000 in the first six months of 2026 and $ 13,000 in the first six months of 2025 for tires and related services.

In addition, we paid $ 544,000 in the first six months of 2026 and $ 613,000 in the first six months of 2025 to tire manufacturers for tires that were provided by the same company.

The same company received commissions from the tire manufacturers related to these purchases.

5 unchanged sentences

We have not repurchased any shares under this program since the second quarter of 2022.

As of March 31, 2026, future repurchases of up to $ 33.2 million were available in the share repurchase program.

As of June 30, 2026, future repurchases of up to $ 33.2 million were available in the share repurchase program.

(6) Dividends

In 2010, we announced a regular cash dividend program to our stockholders, subject to approval each quarter.

Quarterly cash dividends of $ 0.06 per share of common stock were paid in each of the first quarters of 2026 and 2025 which totaled $ 4.9 million in each period.

Quarterly cash dividends of $ 0.06 per share of common stock were paid in each of the first two quarters of 2026 and 2025 which totaled $ 9.8 million in each period.

(7) Accounting for Share-based Payment Arrangement Compensation

We account for share-based payment arrangements in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, 718, Compensation – Stock Compensation .

During the first three months of 2026, there were no significant changes to the structure of our stock-based award plans.

Pre-tax compensation expense related to stock options and performance awards recorded in the first three months of 2026 and 2025 was $ 135,000 and $ 407,000 , respectively.

During the first six months of 2026, there were no significant changes to the structure of our stock-based award plans.

Pre-tax compensation expense related to stock options and performance awards recorded in the first six months of 2026 and 2025 was $ 756,000 and $ 1.3 million, respectively.

(8) Fair Value of Financial Instruments

3 unchanged sentences

Operating lease obligation expenditures through 2028 total $ 358,000 .

We self-insure, in part, for losses relating to workers’ compensation, auto liability, general liability, cargo and property damage claims, along with employees’ health insurance, with varying risk retention levels.

We self-insure, in part, for losses relating to workers’ compensation, auto liability, broker liability, general liability, cargo and property damage claims, along with employees’ health insurance, with varying risk retention levels.

We renewed our liability insurance policies effective June 1, 2026, and are responsible for the first $ 5.0 million on each auto liability claim.

For the policy year effective June 1, 2024, we are responsible for the first $ 2.0 million on each auto liability claim.

For both policy years, we are also responsible for an annual $ 5.0 million aggregate for claims between $ 10.0 million and $ 20.0 million.

For the policy years effective June 1, 2025 and June 1, 2024, we are responsible for the first $ 3.0 million and $ 2.0 million on each auto liability claim, respectively.

For the policy year effective June 1, 2026, we are also responsible for an annual $ 5.0 million aggregate for claims between $ 5.0 million and $ 10.0 million.

For each of the three policy years, we are also responsible for an annual $ 5.0 million aggregate for claims between $ 10.0 million and $ 20.0 million.

We continue to be responsible for the first $ 750,000 on each workers’ compensation claim.

60 unchanged sentences

We base our calculation of the amount of revenue to record in each period for individual loads picking up in one period and delivering in the following period using the number of hours estimated to be incurred within each period applied to each estimated transaction price.

Contract assets for this estimated revenue which are classified within prepaid expenses and other within our consolidated condensed balance sheets were $ 1.8 million and $ 1.4 million as of March 31, 2026 and December 31, 2025, respectively.

We had no impairment losses on contract assets in the first three months of 2026 or in 2025.

We had no impairment losses on contract assets in the first six months of 2026 or in 2025.

As a practical expedient as permitted under FASB ASC 606-10-50-14, we do not disclose the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less.

We bill our customers for loads after delivery is complete with standard payment terms of 30 days.

5 unchanged sentences

The following table sets forth for the periods indicated our operating revenue and operating income by segment.

Ended March 31,

Ended June 30,

(In thousands)

15 unchanged sentences

We do not prepare separate balance sheets by segment and, as a result, assets are not separately identifiable by segment.

Three Months Ended March 31, 2026 Segment Operating Results

Three Months Ended June 30, 2026 Segment Operating Results

(In thousands)

10 unchanged sentences

Total operating expenses

Operating income

Operating ratio

Operating ratio, net of fuel surcharges

Six Months Ended June 30, 2026 Segment Operating Results

(In thousands)

Operating revenue

Operating expense (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income

Operating ratio

Operating ratio, net of fuel surcharges

Three Months Ended June 30, 2025 Segment Operating Results

(In thousands)

Operating revenue

Operating expense (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income/(loss)

1 unchanged sentence

Operating ratio, net of fuel surcharges

Three Months Ended March 31, 2025 Segment Operating Results

Six Months Ended June 30, 2025 Segment Operating Results

(In thousands)

22 unchanged sentences

This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions.

Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including but not limited to those included in our Form 10-K, Part I, Item 1A for the year ended December 31, 2025, and in this Form 10-Q, Part II, Item 1A.

We do not assume, and specifically disclaim, any obligation to update any forward-looking statement contained in this report.

19 unchanged sentences

In addition to the factors discussed above, our operating revenue is also affected by, among other things, the United States economy, inventory levels, the level of truck and rail capacity in the transportation market, a contracting driver market, severe weather conditions and specific customer demand.

Our operating revenue decreased $19.6 million, or 8.8%, in the first three months of 2026 from the first three months of 2025.

Our operating revenue, net of fuel surcharges, decreased $18.6 million, or 9.5%, compared with the first three months of 2025.

Truckload segment revenue, net of fuel surcharges, decreased 0.9% from the first three months of 2025, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Dedicated segment revenue, net of fuel surcharges, decreased 14.8% from the first three months of 2025, also primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Brokerage segment revenue increased 5.0% from the first three months of 2025, primarily due to an increase in our number of loads, partially offset by a decrease in our revenue per load.

Intermodal segment revenue, net of fuel surcharges, decreased 100% from the first three months of 2025.

Fuel surcharge revenue decreased to $26.4 million in the first three months of 2026 from $27.4 million in the first three months of 2025.

Our operating revenue decreased $26.0 million, or 5.7%, in the first six months of 2026 from the first six months of 2025.

Our operating revenue, net of fuel surcharges, decreased $37.2 million, or 9.3%, compared with the first six months of 2025.

Truckload segment revenue, net of fuel surcharges, decreased 0.3% from the first six months of 2025, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Dedicated segment revenue, net of fuel surcharges, decreased 14.5% from the first six months of 2025, also primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Brokerage segment revenue increased 2.4% from the first six months of 2025, primarily due to an increase in our number of loads, partially offset by a decrease in our revenue per load.

Intermodal segment revenue, net of fuel surcharges, decreased 100% from the first six months of 2025.

Fuel surcharge revenue increased to $64.7 million in the first six months of 2026 from $53.5 million in the first six months of 2025.

Our profitability is impacted by the variable costs of transporting freight for our customers, fixed costs, and expenses containing both fixed and variable components.

10 unchanged sentences

This expense is included within purchased transportation in our consolidated condensed statements of operations.

Our operating income declined 72.8% to $1.6 million in the first three months of 2026 from $5.9 million in the first three months of 2025.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 99.2% in the first three months of 2026 and 97.4% in the first three months of 2025.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, increased to 99.1% in the first three months of 2026 from 97.0% in the first three months of 2025.

Our net income declined 68.1% to $1.4 million, or $0.02 per diluted share, in the first three months of 2026 from $4.3 million, or $0.05 per diluted share, in the first three months of 2025.

Our operating income declined 45.4% to $8.5 million in the first six months of 2026 from $15.6 million in the first six months of 2025.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 98.0% in the first six months of 2026 and 96.6% in the first six months of 2025.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, increased to 97.7% in the first six months of 2026 from 96.1% in the first six months of 2025.

Our net income declined 41.7% to $6.7 million, or $0.08 per diluted share, in the first six months of 2026 from $11.5 million, or $0.14 per diluted share, in the first six months of 2025.

Our business requires substantial ongoing capital investments, particularly for new tractors and trailers.

At March 31, 2026, we had $74.8 million of cash and cash equivalents and an escrow deposit, $764.2 million in stockholders’ equity and no long-term debt outstanding.

In the first three months of 2026, net cash flows provided by operating activities of $33.0 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $2.7 million and to pay cash dividends of $4.9 million, resulting in a $26.5 million increase in cash and cash equivalents and an escrow deposit.

At June 30, 2026, we had $109.0 million of cash and cash equivalents and an escrow deposit, $766.0 million in stockholders’ equity and no long-term debt outstanding.

In the first six months of 2026, net cash flows provided by operating activities totaled $60.7 million.

Net cash flows provided by investing activities totaled $9.1 million, primarily reflecting proceeds from the sale of used revenue equipment, net of purchases of new equipment.

In addition, the Company paid $9.8 million in cash dividends.

As a result of these activities, cash and cash equivalents and an escrow deposit increased by $60.7 million during the period.

We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $109 million for the remainder of 2026.

Quarterly cash dividends of $0.06 per share of common stock were paid in the first three months of 2026, which totaled $4.9 million.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first two quarters of 2026, which totaled $9.8 million.

We believe our sources of liquidity are adequate to meet our current and anticipated needs for at least the next twelve months.

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The following table sets forth for the periods indicated certain operating statistics regarding our revenue and operations:

Ended March 31,

Ended June 30,

Truckload Segment:

16 unchanged sentences

Includes tractors driven by both company-employed drivers and independent contractors.

Independent contractors provided 77 and 82 tractors as of March 31, 2026 and 2025, respectively.

Comparison of Three Months Ended March 31, 2026 to Three Months Ended March 31, 2025

Independent contractors provided 81 and 80 tractors as of June 30, 2026 and 2025, respectively.

Comparison of Three Months Ended June 30, 2026 to Three Months Ended June 30, 2025

The following table sets forth for the periods indicated our operating revenue, operating income and operating ratio by segment, along with the change for each component:

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Our operating revenue, net of fuel surcharges, decreased $18.5 million, or 9.1%, to $185.2 million in the 2026 period from $203.8 million in the 2025 period.

This decrease in the 2026 period was primarily due to a $9.2 million decrease in Dedicated revenue, net of fuel surcharges, a $796,000 decrease in Truckload revenue, net of fuel surcharges, a $1.7 million increase in Brokerage revenue and a $10.3 million decrease in Intermodal revenue, net of fuel surcharges.

Fuel surcharge revenue decreased to $26.4 million in the 2026 period from $27.4 million in the 2025 period.

Truckload segment revenue increased $999,000, or 1.0%, to $105.4 million in the 2026 period from $104.4 million in the 2025 period.

Truckload segment revenue, net of fuel surcharges, decreased $796,000, or 0.9%, to $89.3 million in the 2026 period from $90.1 million in the 2025 period, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

This decrease in the 2026 period was primarily due to an $8.8 million decrease in Dedicated revenue, net of fuel surcharges, and a $10.1 million decrease in Intermodal revenue, net of fuel surcharges.

Fuel surcharge revenue increased to $38.3 million in the 2026 period from $26.1 million in the 2025 period.

Truckload segment revenue increased $9.8 million, or 9.2%, to $116.3 million in the 2026 period from $106.5 million in the 2025 period.

Truckload segment revenue, net of fuel surcharges, increased $237,000, or 0.3%, to $92.7 million in the 2026 period from $92.5 million in the 2025 period, primarily due to an increase in our average revenue per tractor, partially offset by a decrease in our average fleet size.

The operating ratio was 97.9% in the 2026 period and 97.8% in the 2025 period.

Impacting the 2026 period operating ratio was higher fuel costs, partially offset by lower company driver compensation, both as a percentage of revenue, along with improved average revenue per tractor.

Impacting the 2026 period operating ratio was higher fuel costs and a lower gain on disposition of revenue equipment, partially offset by lower company driver compensation and insurance and claims costs, all as a percentage of revenue, along with the improved average revenue per tractor.

Dedicated segment revenue decreased $4.6 million, or 6.4%, to $67.3 million in the 2026 period from $71.9 million in the 2025 period.

1 unchanged sentence

The operating ratio increased to 96.4% in the 2026 period from 92.4% in the 2025 period.

Impacting the 2026 period operating ratio was higher fuel, non-driver compensation and insurance and claims costs, all as a percentage of revenue, partially offset by increased average revenue per tractor.

Brokerage segment revenue increased $1.7 million, or 5.0%, to $34.7 million in the 2026 period from $33.0 million in the 2025 period, primarily due to an increase in our number of loads, partially offset by a decrease in our revenue per load.

Impacting the 2026 period operating ratio was higher fuel costs and a lower gain on disposition of revenue equipment, partially offset by lower insurance and claims and company driver compensation costs, all as a percentage of revenue, along with the improved average revenue per tractor.

Brokerage segment revenue increased 0.2% and was $39.9 million in each of the 2026 and 2025 periods, primarily due to an increase in our number of loads, partially offset by a decrease in our revenue per load.

The operating ratio in the 2026 period of 94.8% was up from 93.2% in the 2025 period.

This increase was primarily due to an increase in the amounts payable to carriers for transportation services which we arranged and higher insurance and claims costs, both as a percentage of revenue.

This increase was primarily due to an increase in the amounts payable to carriers for transportation services which we arranged, partially offset by lower insurance and claims costs, both as a percentage of revenue.

Intermodal segment revenue was $11.7 million and revenue net of fuel surcharges was $10.1 million in the 2025 period.

28 unchanged sentences

The portion of purchased transportation expense related to independent contractors within our Truckload and Dedicated segments, including fuel surcharges, increased by $498,000 in the 2026 period.

Fuel and fuel taxes increased by $790,000, or 2.4%, in the 2026 period from the 2025 period.

Fuel and fuel taxes increased by $13.2 million, or 40.4%, in the 2026 period from the 2025 period.

Net fuel expense (fuel and fuel taxes net of fuel surcharge revenue and surcharges passed through to independent contractors, outside drayage carriers and railroads) increased $187,000, or 2.3%, to $8.5 million in the 2026 period from $8.3 million in the 2025 period.

Fuel surcharges passed through to independent contractors, outside drayage carriers and railroads decreased to $658,000 from $1.9 million in the 2025 period.

Fuel surcharges passed through to independent contractors, outside drayage carriers and railroads decreased to $1.0 million from $1.8 million in the 2025 period.

The United States Department of Energy, or DOE, national average cost of fuel increased to $5.35 per gallon from $3.56 per gallon in the 2025 period.

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These expenses will vary primarily based upon the frequency and severity of our accident experience, our self-insured retention levels and the market for insurance.

The $132,000, or 1.0%, decrease in insurance and claims in the 2026 period was primarily due to a decrease in our self-insured auto liability claim costs, partially offset by increases in both our self-insured costs of physical damage claims related to our revenue equipment and brokerage claim costs.

The $6.5 million, or 41.3%, decrease in insurance and claims in the 2026 period was primarily due to decreases in our self-insured auto liability, brokerage liability and workers’ compensation claim costs, along with decreases in our self-insured costs of physical damage claims related to our revenue equipment and in insurance premiums.

Our significant self-insured retention exposes us to the possibility of significant fluctuations in claims expense between periods which could materially impact our financial results depending on the frequency, severity and timing of claims.

1 unchanged sentence

Future gains or losses on dispositions of revenue equipment will be impacted by the market for used revenue equipment, which is beyond our control.

The $2.2 million, or 26.4%, decrease in other operating expenses in the 2026 period was primarily due to decreases in legal costs and chassis rental expense.

Our operating income declined 29.0% to $6.9 million in the 2026 period from $9.7 million in the 2025 period as a result of the foregoing factors.

4 unchanged sentences

As a result of the factors described above, net income declined 25.7% to $5.3 million, or $0.07 per diluted share, in the 2026 period from $7.2 million, or $0.09 per diluted share, in the 2025 period.

Comparison of Six Months Ended June 30, 2026 to Six Months Ended June 30, 2025

The following table sets forth for the periods indicated our operating revenue, operating income and operating ratio by segment, along with the change for each component:

(Dollars in thousands)

Operating revenue:

Truckload revenue, net of fuel surcharge revenue

Truckload fuel surcharge revenue

Total Truckload revenue

Dedicated revenue, net of fuel surcharge revenue

Dedicated fuel surcharge revenue

Total Dedicated revenue

Brokerage revenue

Intermodal revenue, net of fuel surcharge revenue

Intermodal fuel surcharge revenue

Total Intermodal revenue

Total operating revenue

Operating income/(loss):

Total operating income

Operating ratio:

Consolidated operating ratio

Operating ratio, net of fuel surcharges:

Consolidated operating ratio, net of fuel surcharges

Our operating revenue decreased $26.0 million, or 5.7%, to $427.1 million in the 2026 period from $453.1 million in the 2025 period.

Our operating revenue, net of fuel surcharges, decreased $37.2 million, or 9.3%, to $362.4 million in the 2026 period from $399.6 million in the 2025 period.

This decrease in the 2026 period was primarily due to an $18.0 million decrease in Dedicated revenue, net of fuel surcharges, a $559,000 decrease in Truckload revenue, net of fuel surcharges, and a $20.4 million decrease in Intermodal revenue, net of fuel surcharges, partially offset by a $1.7 million increase in Brokerage revenue.

Fuel surcharge revenue increased to $64.7 million in the 2026 period from $53.5 million in the 2025 period.

Truckload segment revenue increased $10.8 million, or 5.1%, to $221.7 million in the 2026 period from $210.9 million in the 2025 period.

Truckload segment revenue, net of fuel surcharges, decreased $559,000, or 0.3%, to $182.0 million in the 2026 period from $182.6 million in the 2025 period, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

The operating ratio was 99.3% in the 2026 period and 99.0% in the 2025 period.

Dedicated segment revenue decreased $14.7 million, or 10.1%, to $130.8 million in the 2026 period from $145.5 million in the 2025 period.

Dedicated segment revenue, net of fuel surcharges, decreased 14.5%, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

The operating ratio increased to 96.9% in the 2026 period from 92.9% in the 2025 period.

Impacting the 2026 period operating ratio was higher fuel costs and a lower gain on disposition of revenue equipment, partially offset by lower insurance and claims costs, all as a percentage of revenue, along with the improved average revenue per tractor.

Brokerage segment revenue increased $1.7 million, or 2.4%, to $74.6 million in the 2026 period from $72.9 million in the 2025 period, primarily due to an increase in our number of loads, partially offset by a decrease in our revenue per load.

The operating ratio in the 2026 period of 96.0% was up from 93.3% in the 2025 period.

This increase was primarily due to an increase in the amounts payable to carriers for transportation services which we arranged, as a percentage of revenue.

Intermodal segment revenue was $23.8 million and revenue net of fuel surcharges was $20.4 million in the 2025 period.

The operating ratio was 106.7% in the 2025 period.

The following table sets forth for the periods indicated the dollar and percentage increase or decrease of the items in our unaudited consolidated condensed statements of operations, and those items as a percentage of operating revenue:

Percentage of

Operating Revenue

(Dollars in thousands)

Operating revenue

Operating expenses (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income

Income before income taxes

Income taxes expense

Salaries, wages and benefits expense decreased $12.7 million, or 8.1%, in the 2026 period from the 2025 period.

This decrease resulted primarily from reductions in company driver compensation expense of $11.1 million.

Purchased transportation expense decreased $8.5 million in total, or 10.5%, in the 2026 period from the 2025 period.

Amounts payable to carriers for transportation services we arranged in our Brokerage segment increased $3.8 million to $65.0 million in the 2026 period from $61.2 million in the 2025 period, primarily due to an increase in our number of loads.

Amounts payable to railroads and drayage carriers for transportation services within our Intermodal operations that were sold effective September 30, 2025 decreased by $12.8 million from the 2025 period.

The portion of purchased transportation expense related to independent contractors within our Truckload and Dedicated segments, including fuel surcharges, increased by $520,000 in the 2026 period.

Fuel and fuel taxes increased by $14.0 million, or 21.3%, in the 2026 period from the 2025 period.

Net fuel expense (fuel and fuel taxes net of fuel surcharge revenue and surcharges passed through to independent contractors, outside drayage carriers and railroads) increased $705,000, or 4.4%, to $16.7 million in the 2026 period from $16.0 million in the 2025 period.

Fuel surcharges passed through to independent contractors, outside drayage carriers and railroads decreased to $1.7 million from $3.8 million in the 2025 period.

The DOE national average cost of fuel increased to $4.74 per gallon from $3.59 per gallon in the 2025 period.

This price increase primarily drove the increase in our net fuel expense to 5.8% of Truckload, Dedicated and Intermodal segment revenue, net of fuel surcharges, in the 2026 period from 4.9% in the 2025 period.

The $5.0 million, or 9.1%, decrease in depreciation in the 2026 period was primarily due to a decrease in our average tractor, trailer and refrigerated container fleet size, partially offset by higher prices of new equipment.

The $6.7 million, or 22.8%, decrease in insurance and claims in the 2026 period was primarily due to decreases in each of our self-insured auto liability claims and insurance premiums.

Gain on disposition of revenue equipment decreased to $3.1 million in the 2026 period from $6.8 million in the 2025 period due to a reduction in the number of units sold, partially offset by an increase in the average gain for our tractor and trailer sales.

The $2.5 million, or 15.8%, decrease in other operating expenses in the 2026 period was primarily due to decreases in chassis rental and legal costs.

Our operating income declined 45.4% to $8.5 million in the 2026 period from $15.6 million in the 2025 period as a result of the foregoing factors.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 98.0% in the 2026 period and 96.6% in the 2025 period.

The operating ratio for our Truckload segment was 99.3% in the 2026 period and 99.0% in the 2025 period, for our Dedicated segment was 96.9% in the 2026 period and 92.9% in the 2025 period, for our Brokerage segment was 96.0% in the 2026 period and 93.3% in the 2025 period and for our Intermodal segment was 106.7% in the 2025 period.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 97.7% in the 2026 period and 96.1% in the 2025 period.

Our effective income tax rate increased to 30.6% in the 2026 period from 29.7% in the 2025 period primarily due to increases in per diem and other non-deductible expenses as a percentage of earnings.

As a result of the factors described above, net income declined 41.7% to $6.7 million, or $0.08 per diluted share, in the 2026 period from $11.5 million, or $0.14 per diluted share, in the 2025 period.

Liquidity and Capital Resources

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We have no capital expenditure requirements relating to those drivers who own their tractors or obtain financing through third parties.

The table below reflects our net cash flows provided by operating activities, net cash flows used for investing activities and net cash flows used for financing activities for the periods indicated.

Ended March 31,

The table below reflects our net cash flows provided by operating activities, net cash flows provided by/(used for) investing activities and net cash flows used for financing activities for the periods indicated.

Ended June 30,

(In thousands)

Net cash flows provided by operating activities

Net cash flows used for investing activities

Net cash flows provided by/(used for) investing activities

Net cash flows used for financing activities

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We have not repurchased any shares under this program since the second quarter of 2022.

As of March 31, 2026, future repurchases of up to $33.2 million were available in the share repurchase program.

In the first three months of 2025, net cash flows provided by operating activities of $36.2 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $6.0 million, to pay cash dividends of $4.9 million and to purchase other assets in the amount of $2.4 million, resulting in a $22.6 million increase in cash and cash equivalents.

As of June 30, 2026, future repurchases of up to $33.2 million were available in the share repurchase program.

In the first six months of 2026, net cash flows provided by operating activities totaled $60.7 million.

Net cash flows provided by investing activities totaled $9.1 million, primarily reflecting proceeds from the sale of used revenue equipment, net of purchases of new equipment.

In addition, the Company paid $9.8 million in cash dividends.

As a result of these activities, cash and cash equivalents and an escrow deposit increased by $60.7 million during the period.

In the first six months of 2025, net cash flows provided by operating activities of $69.4 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $38.8 million, to pay cash dividends of $9.8 million and to purchase other assets in the amount of $2.7 million, resulting in a $17.8 million increase in cash and cash equivalents.

We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $109 million for the remainder of 2026.

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Additionally, operating lease obligations total $358,000 through 2028.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first quarters of 2026 and 2025, which totaled $4.9 million in each period.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first two quarters of 2026 and 2025, which totaled $9.8 million in each period.

We currently expect to continue to pay quarterly cash dividends in the future.

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The credit agreement amends, restates and continues in its entirety our previous credit agreement, as amended.

At March 31, 2026, there was no outstanding principal balance on the facility.

In June 2026, the credit agreement was amended to increase the aggregate principal amount to $35.0 million.

At June 30, 2026, there was no outstanding principal balance on the facility.

As of that date, we had outstanding standby letters of credit to guarantee settlement of self-insurance claims of $33.2 million and remaining borrowing availability of $1.8 million.

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This facility bears interest at a variable rate based on the Term SOFR Rate plus applicable margins.

The interest rate for the facility that would apply to outstanding principal balances was 6.75% at March 31, 2026.

The interest rate for the facility that would apply to outstanding principal balances was 6.75% at June 30, 2026.

Our credit agreement effective in August 2022 prohibits us from paying, in any fiscal year, stock redemptions and dividends in excess of $150 million.

The credit agreement also contains restrictive covenants which, among other matters, require us to maintain compliance with cash flow leverage and fixed charge coverage ratios.

We were in compliance with all covenants at March 31, 2026 and December 31, 2025.

Other than our obligations for revenue equipment and operating lease expenditures, along with our outstanding standby letters of credit to guarantee settlement of self-insurance claims, which are each mentioned above, we did not have any material off-balance sheet arrangements at March 31, 2026.

We were in compliance with all covenants at June 30, 2026 and December 31, 2025.

Our tractor productivity generally decreases during the winter season because inclement weather impedes operations and some shippers reduce their shipments.

4 unchanged sentences

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