What changed in this filing

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Item 1. Financial Statements

2025-10-30 compared with 2025-07-31 · 111 added, 89 removed, 467 unchanged (30% of the section changed)

1 unchanged sentence

Condensed Consolidated Balance Sheets

June 30, December 31,

September 30, December 31,

(In millions, except per share data) 2025 2024

8 unchanged sentences

Goodwill 1,546 1,461

Identifiable intangible assets, net of $ 552 and $ 499 in accumulated amortization, respectively

Identifiable intangible assets, net of $ 565 and $ 499 in accumulated amortization,

Other long-term assets 214 254

19 unchanged sentences

300 shares authorized;

118 and 117 shares issued and

outstanding as of June 30, 2025 and December 31, 2024, respectively

117 shares issued and

outstanding as of September 30, 2025 and December 31, 2024, respectively

Additional paid-in capital 1,196 1,274

6 unchanged sentences

Condensed Consolidated Statements of Income

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions, except per share data) 2025 2024 2025 2024

5 unchanged sentences

Insurance and claims 43 33 118 105

Gains on sales of property and equipment ( 1 ) ( 4 ) ( 3 ) ( 5 )

(Gains) losses on sales of property and equipment 1 — ( 2 ) ( 5 )

Depreciation and amortization expense 134 126 388 365

Pre-Con-way acquisition environmental matter 35 — 35 —

Legal matter — — ( 13 ) —

5 unchanged sentences

Interest expense 54 56 166 170

Income before income tax provision (benefit) 143 147 234 237

Income tax provision (benefit) 37 ( 3 ) 59 20

Income before income tax provision 112 135 346 372

Income tax provision 30 40 89 60

Net income $ 82 $ 95 $ 257 $ 312

8 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

11 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions) 2025 2024

16 unchanged sentences

Proceeds from sale of property and equipment 18 17

Proceeds from sale of investment — 8

Net cash used in investing activities ( 532 ) ( 598 )

Cash flows from financing activities

Repurchase of debt ( 50 ) —

Repayment of debt and finance leases ( 56 ) ( 64 )

6 unchanged sentences

Effect of exchange rates on cash, cash equivalents and restricted cash ( 1 ) 5

Net decrease in cash, cash equivalents and restricted cash ( 65 ) ( 162 )

Net increase (decrease) in cash, cash equivalents and restricted cash 42 ( 33 )

Cash, cash equivalents and restricted cash, beginning of period 298 419

1 unchanged sentence

Supplemental disclosure of cash flow information

Unsettled repurchase of common stock $ ( 3 ) $ —

Leased assets obtained in exchange for new operating lease liabilities 155 175

1 unchanged sentence

Cash paid for interest 158 148

Cash paid for income taxes, net of refunds 31 32

Cash paid (received) for income taxes, net of refunds ( 11 ) 71

Amounts may not add due to rounding.

3 unchanged sentences

Comprehensive Loss Total Equity

Balance as of March 31, 2025 117,788 $ — $ 1,227 $ 641 $ ( 228 ) $ 1,640

Balance as of June 30, 2025 117,745 $ — $ 1,233 $ 747 $ ( 199 ) $ 1,781

Net income — — — 82 — 82

Other comprehensive income — — — — 29 29

Other comprehensive loss — — — — ( 9 ) ( 9 )

Exercise and vesting of stock compensation awards

4 unchanged sentences

— — 16 — — 16

Balance as of June 30, 2025 117,745 $ — $ 1,233 $ 747 $ ( 199 ) $ 1,781

Balance as of September 30, 2025 117,384 $ — $ 1,196 $ 829 $ ( 208 ) $ 1,817

(Shares in thousands, dollars in millions) Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other

10 unchanged sentences

— — 46 — — 46

Balance as of June 30, 2025 117,745 $ — $ 1,233 $ 747 $ ( 199 ) $ 1,781

Balance as of September 30, 2025 117,384 $ — $ 1,196 $ 829 $ ( 208 ) $ 1,817

(Shares in thousands, dollars in millions) Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other

Comprehensive Loss Total Equity

Balance as of March 31, 2024 116,312 $ — $ 1,302 $ 252 $ ( 222 ) $ 1,332

Balance as of June 30, 2024 116,344 $ — $ 1,322 $ 402 $ ( 225 ) $ 1,499

Net income — — — 95 — 95

Other comprehensive loss — — — — ( 3 ) ( 3 )

Other comprehensive income — — — — 29 29

Exercise and vesting of stock compensation awards

3 unchanged sentences

— — 22 — — 22

Balance as of June 30, 2024 116,344 $ — $ 1,322 $ 402 $ ( 225 ) $ 1,499

Balance as of September 30, 2024 116,401 $ — $ 1,340 $ 496 $ ( 195 ) $ 1,641

(Shares in thousands, dollars in millions) Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other

2 unchanged sentences

Net income — — — 312 — 312

Other comprehensive loss — — — — ( 8 ) ( 8 )

Other comprehensive income — — — — 21 21

Exercise and vesting of stock compensation awards

4 unchanged sentences

— — 64 — — 64

Balance as of June 30, 2024 116,344 $ — $ 1,322 $ 402 $ ( 225 ) $ 1,499

Balance as of September 30, 2024 116,401 $ — $ 1,340 $ 496 $ ( 195 ) $ 1,641

Amounts may not add due to rounding.

16 unchanged sentences

The Condensed Consolidated Financial Statements are not audited but reflect all adjustments that are of a normal recurring nature and are necessary for a fair presentation of the financial condition, operating results and cash flows for the interim periods presented.

Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

Operating results for the three and nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

Within our Condensed Consolidated Financial Statements and the accompanying notes, certain amounts may not add due to the use of rounded numbers.

1 unchanged sentence

Restricted Cash

As of June 30, 2025 and December 31, 2024, our restricted cash included in Other long-term assets on our Condensed Consolidated Balance Sheets was $ 8 million and $ 53 million, respectively.

As of September 30, 2025 and December 31, 2024, our restricted cash included in Other long-term assets on our Condensed Consolidated Balance Sheets was $ 5 million and $ 53 million, respectively.

Our restricted cash balance as of December 31, 2024 included approximately $ 47 million of proceeds received from the sale of a service center in our North American LTL segment in December 2024.

4 unchanged sentences

We use trade receivables securitization and factoring programs to help manage our cash flows and offset the impact of extended payment terms for some of our customers.

The maximum amount of net cash proceeds available at any one time under our securitization program, inclusive of any unsecured borrowings, is € 200 million (approximately $ 236 million as of June 30, 2025).

As of June 30, 2025, € 1 million (approximately $ 2 million) was available under the program.

The weighted average interest rate was 4.80 % as of June 30, 2025.

The maximum amount of net cash proceeds available at any one time under our securitization program, inclusive of any unsecured borrowings, is € 200 million (approximately $ 235 million as of September 30, 2025).

As of September 30, 2025, € 1 million (approximately $ 1 million) was available under the program.

The weighted average interest rate was 3.95 % as of September 30, 2025.

The program expires in July 2026.

Information related to the trade receivables sold was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

16 unchanged sentences

We base our fair value estimates on market assumptions and available information.

The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and current maturities of long-term debt approximated their fair values as of June 30, 2025 and December 31, 2024 due to their short-term nature and/or being receivable or payable on demand.

The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and current maturities of long-term debt approximated their fair values as of September 30, 2025 and December 31, 2024 due to their short-term nature and/or being receivable or payable on demand.

The Level 1 cash equivalents include money market funds valued using quoted prices in active markets and a cash deposit for the securitization program.

1 unchanged sentence

(In millions) Carrying Value Fair Value Level 1

June 30, 2025 $ 196 $ 196 $ 196

September 30, 2025 $ 304 $ 304 $ 304

December 31, 2024 205 205 205

We measure Level 1 equity investments at fair value on a recurring basis using quoted prices in active markets.

We have no equity investments as of June 30, 2025 and, as of December 31, 2024, the value of our equity investment, reflected within Other current assets on our Condensed Consolidated Balance Sheets, was not material.

During the first quarter of 2024, we recognized a gain on equity investments of $ 3 million in Other income on our Condensed Consolidated Statements of Income.

There was no material gain on equity investments in the second quarter of 2024 or in 2025.

We have no equity investments as of September 30, 2025 and, as of December 31, 2024, the value of our equity investment, reflected within Other current assets on our Condensed Consolidated Balance Sheets, was not material.

During the three and nine months ended September 30, 2024, we recognized a gain on equity investments of $ 9 million and $ 13 million, respectively, in Other income on our Condensed Consolidated Statements of Income.

There was no material gain on equity investments in 2025.

For information on the fair value hierarchy of our derivative instruments and financial liabilities, see Note 5—Derivative Instruments and Note 6—Debt, respectively.

Accounting Pronouncements Issued but Not Yet Effective

In November 2024, the Financial Accounting Standards Board (“FASB”) issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40).” The ASU requires new tabular disclosures disaggregating prescribed expense categories within relevant income statement captions.

In September 2025, the Financial Accounting Standards Board (“FASB”) issued ASU 2025-06, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40).” The ASU updates the guidance on accounting for internal-use software costs by (i) removing all references to software development stages, and (ii) requiring that an entity capitalize software costs when both management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function intended.

This ASU is effective for annual and interim periods beginning in 2028.

Early adoption is permitted.

We are currently evaluating the impact of the new standard.

In July 2025, the FASB issued ASU 2025-05, “Financial Instruments – Credit Losses (Topic 326).” In developing forecasts as part of estimating expected credit losses, the ASU allows entities to elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset.

This ASU is effective for annual and interim periods beginning in 2026.

Early adoption is permitted.

We do not expect the new standard to have a material impact on our financial statements.

In November 2024, the FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40).” The ASU requires new tabular disclosures disaggregating prescribed expense categories within relevant income statement captions.

In addition, the ASU requires disclosure of the total amount of selling expenses and, in annual periods, an entity’s definition of selling expenses, among other disclosure requirements.

6 unchanged sentences

Early adoption is permitted.

We are currently evaluating the impact of the new standard, which is limited to financial statement disclosures.

The company expects to adopt the guidance as of the effective date.

We plan to update our income tax financial statement disclosures to comply with the new standard as of the effective date.

Segment Reporting

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We do not provide asset information by segment to the CODM.

Our CODM evaluates segment profit (loss) based on adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), which we define as income before debt extinguishment loss, interest expense, income tax provision (benefit), depreciation and amortization expense, legal matters, transaction and integration costs, restructuring costs and other adjustments.

Our CODM evaluates segment profit (loss) based on adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), which we define as income before debt extinguishment loss, interest expense, income tax provision, depreciation and amortization expense, legal matters, transaction and integration costs, restructuring costs and other adjustments.

Our CODM uses adjusted EBITDA to allocate resources, including property and equipment and financial or capital resources, to the segments and to assess their performance by monitoring budget-to-actual and year-over-year variances.

The following tables present revenue and significant segment expenses that are included within adjusted EBITDA:

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

(In millions) North American LTL European Transportation Corporate (1)

8 unchanged sentences

Adjusted EBITDA $ 308 $ 38 $ ( 4 ) $ 342

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In millions) North American LTL European Transportation Corporate (1)

7 unchanged sentences

Pension (income) expense ( 6 ) — — ( 6 )

Other (income) expense — 1 ( 9 ) ( 9 )

Adjusted EBITDA $ 284 $ 44 $ 5 $ 333

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(In millions) North American LTL European Transportation Corporate (1)

7 unchanged sentences

Pension (income) expense ( 5 ) — — ( 4 )

Other (income) expense — 1 ( 1 ) —

Adjusted EBITDA $ 857 $ 115 $ ( 12 ) $ 960

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In millions) North American LTL European Transportation Corporate (1)

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Adjusted EBITDA $ 836 $ 131 $ ( 3 ) $ 964

(1) Primarily represents unallocated corporate costs, as well as investment income of approximately $ 3 million within Other (income) expense in the first quarter of 2024.

(1) Primarily represents unallocated corporate costs, as well as investment income of approximately $ 9 million and $ 13 million, respectively, within Other (income) expense for the three and nine months ended September 30, 2024.

The following table presents adjusted EBITDA by segment and provides a reconciliation to consolidated net income:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

6 unchanged sentences

Interest expense 54 56 166 170

Income tax provision (benefit) 37 ( 3 ) 59 20

Income tax provision 30 40 89 60

Depreciation and amortization expense 134 126 388 365

Pre-Con-way acquisition environmental

Legal matter (2)

( 2 ) — ( 13 ) —

Transaction and integration costs 1 13 7 39

1 unchanged sentence

Net Income $ 82 $ 95 $ 257 $ 312

(1) Relates to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO's acquisition of Con-way in 2015.

(2) Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to our acquisition of Norbert Dentressangle SA in 2015.

The following table presents depreciation and amortization expense by segment:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

4 unchanged sentences

Total $ 134 $ 126 $ 388 $ 365

As of June 30, 2025 and December 31, 2024, we held long-lived tangible assets outside of the U.S., including right of use assets, of $ 789 million and $ 715 million, respectively.

As of September 30, 2025 and December 31, 2024, we held long-lived tangible assets outside of the U.S., including right of use assets, of $ 793 million and $ 715 million, respectively.

Revenue Recognition

1 unchanged sentence

Our revenue disaggregated by geographic area based on sales office location was as follows:

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

(In millions) North American LTL European Transportation Total

5 unchanged sentences

Total $ 1,255 $ 857 $ 2,111

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In millions) North American LTL European Transportation Total

5 unchanged sentences

Total $ 1,251 $ 803 $ 2,053

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(In millions) North American LTL European Transportation Total

5 unchanged sentences

Total $ 3,667 $ 2,479 $ 6,146

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In millions) North American LTL European Transportation Total

9 unchanged sentences

Our restructuring-related activity was as follows:

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(In millions) Reserve Balance

December 31, 2024 Charges Incurred Payments Reserve Balance

June 30, 2025

September 30, 2025

North American LTL $ 3 $ 4 $ ( 4 ) $ 2

2 unchanged sentences

Total $ 5 $ 22 $ ( 16 ) $ 11

In addition to the severance charges noted in the table above, we recorded non-cash charges in our European Transportation segment of $ 2 million during the first six months of 2025.

We expect that the majority of the cash outlays related to the severance charges incurred in the first six months of 2025 will be completed within 12 months.

In addition to the severance charges noted in the table above, we recorded non-cash charges in our European Transportation segment of $ 4 million during the first nine months of 2025.

We expect that the majority of the cash outlays related to the severance charges incurred in the first nine months of 2025 will be completed within 12 months.

Derivative Instruments

5 unchanged sentences

The fair value of our derivative instruments and the related notional amounts were as follows:

June 30, 2025

September 30, 2025

Derivative Assets Derivative Liabilities

16 unchanged sentences

Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) on Derivatives Amount of Gain Reclassified from AOCI into Net Income Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)

Three Months Ended June 30,

Three Months Ended September 30,

(In millions) 2025 2024 2025 2024 2025 2024

4 unchanged sentences

Total $ 4 $ ( 24 ) $ 1 $ — $ 3 $ 2

Six Months Ended June 30,

Amount of Loss Recognized in Other Comprehensive Income (Loss) on Derivatives Amount of Gain Reclassified from AOCI into Net Income Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)

Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024 2025 2024

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We designated the interest rate swaps as qualifying hedging instruments and account for these derivatives as cash flow hedges.

In the second quarter of 2025, we extended our outstanding interest rate swaps through the fourth quarter of 2026.

Our outstanding interest rate swaps mature in the fourth quarter of 2026.

We record gains and losses resulting from fair value adjustments to the designated portion of interest rate swaps in AOCI and reclassify them to Interest expense on the dates that interest payments accrue.

Cash flows related to the interest rate swaps are included in Cash flows from operating activities on our Condensed Consolidated Statements of Cash Flows.

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(In millions) Principal Balance Carrying Value Principal Balance Carrying Value

14 unchanged sentences

(In millions) Fair Value Level 1 Level 2

June 30, 2025 $ 3,593 $ 2,246 $ 1,346

September 30, 2025 $ 3,537 $ 2,253 $ 1,284

December 31, 2024 3,541 2,223 1,318

5 unchanged sentences

The maturity date of the Revolving Credit Facility is April 30, 2030.

As of June 30, 2025, we have $ 599 million available to draw under our Revolving Credit Facility, after considering outstanding letters of credit of less than $ 1 million.

As of September 30, 2025, we have approximately $ 600 million available to draw under our Revolving Credit Facility, after considering outstanding letters of credit of less than $ 1 million.

Our borrowings under the Revolving Credit Facility bear interest at a rate equal to:

1 unchanged sentence

Dollars, Term Secured Overnight Financing Rate (“SOFR”) or the Base Rate and (b) for loans denominated in Canadian Dollars, Term Canadian Overnight Repo Rate (“CORRA”) or the Canadian base rate plus (i) in the case of base rate loans, an applicable rate ranging from 0.25 % to 1.00 % or, (ii) in the case of Term SOFR or Term CORRA loans, an applicable rate ranging from 1.25 % to 2.00 %, which is determined based on our Consolidated Total Net Leverage Ratio (as defined in the Revolving Credit Agreement).

In addition, we are required to pay an unused

commitment fee of between 0.20 % and 0.30 % on the undrawn commitments under the Revolving Credit Facility, determined based on our Consolidated Total Net Leverage Ratio.

In addition, we are required to pay an unused commitment fee of between 0.20 % and 0.30 % on the undrawn commitments under the Revolving Credit Facility, determined based on our Consolidated Total Net Leverage Ratio.

The Revolving Credit Facility is secured by a lien on substantially all of our assets and the assets of our guarantors, with certain exceptions, and contains representations and warranties, affirmative and negative covenants, and events of default customary for agreements of this nature.

Security interests and certain covenants under the Revolving Credit Agreement will release, terminate or be amended upon, among other things, the Company’s achievement of investment grade ratings from at least two rating agencies.

As of June 30, 2025, we were in compliance with the Revolving Credit Facility’s financial covenants.

As of September 30, 2025, we were in compliance with the Revolving Credit Facility’s financial covenants.

Letters of Credit Facility

As of June 30, 2025, we had issued $ 133 million in aggregate face amount of letters of credit under our $ 200 million uncommitted secured evergreen letter of credit facility.

As of September 30, 2025, we had issued $ 133 million in aggregate face amount of letters of credit under our $ 200 million uncommitted secured evergreen letter of credit facility.

Term Loan Facility

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We recorded a debt extinguishment loss of $ 5 million in the first quarter of 2025 due to this refinancing.

In July 2025, we used cash on hand to repay $ 50 million of outstanding principal under the Refinancing Term Loan B-2 Facility, which was scheduled to mature in 2028.

In September 2025, we gave notice to repay an additional $ 65 million of outstanding principal under the Refinancing Term Loan B-2 Facility to occur in October 2025.

As a result, as of September 30, 2025, we classified $ 65 million of the Refinancing Term Loan B-2 Facility within Short-term borrowings and current maturities of long-term debt.

In October 2025, we used cash on hand to repay $ 65 million of outstanding principal under this loan.

The Refinancing Term Loan Facilities bear interest at a rate per annum equal to, at the Company’s option, either alternate base rate (“ABR”) or Term SOFR plus (i) in the case of ABR Loans, 0.75 % or, (ii) in the case of Term SOFR Loans, 1.75 %, which, in each case after September 30, 2025, shall be reduced by 0.25 % upon the achievement of a Consolidated First Lien Net Leverage Ratio (as defined in the Amended Term Loan Credit Agreement) of less than or equal to 1.21 to 1.00.

1 unchanged sentence

The Amended Term Loan Credit Agreement contains customary mandatory prepayment requirements, representations and warranties, events of default, reporting and other affirmative covenants and negative covenants, including limitations on indebtedness, liens, investments, dividends, repayments of junior financings and asset sales, in each case subject to a number of important exceptions and qualifications.

The weighted average interest rate of our term loans was approximately 6.08 % as of June 30, 2025.

The weighted average interest rate of our term loans was approximately 5.88 % as of September 30, 2025.

Stockholders’ Equity

2 unchanged sentences

The repurchase authorization permits us to purchase shares in both the open market and in private transactions, with the timing and number of shares dependent on a variety of factors, including price, general business and market conditions, alternative investment opportunities and funding considerations.

We retire common shares that we repurchase upon settlement.

The new share repurchase program has no expiration date and may be utilized over time, with no obligation to repurchase any specific number of shares.

1 unchanged sentence

This plan replaced our previous share repurchase plan, authorized in February 2019.

In the second quarter of 2025, we repurchased and retired 0.1 million shares of common stock with an aggregate value of $ 10 million at an average price of $ 120.41 per share.

In the third quarter of 2025, we repurchased 388 thousand shares of common stock with an aggregate value of $ 50 million at an average price of $ 128.86 per share.

In the first nine months of 2025, we repurchased 471 thousand shares of common stock with an aggregate value of $ 60 million at an average price of $ 127.37 per share.

The share repurchases were funded by cash on hand.

As of June 30, 2025, our remaining share repurchase authorization was $ 740 million.

On July 4, 2025, the One Big Beautiful Bill Act was signed into law.

As of September 30, 2025, our remaining share repurchase authorization was $ 690 million.

In July 2025, the One Big Beautiful Bill Act was signed into law.

The legislation includes modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions including 100% bonus depreciation for qualified property placed in service after January 19, 2025, immediate expensing of domestic research and experimental costs, and business interest expense limitations.

We are evaluating the full effects of the legislation on our financial statements, but we anticipate cash tax savings with an immaterial impact on our effective tax rate.

During the second quarter of 2024, the Company executed a legal entity reorganization in our European Transportation business that resulted in a one-time tax benefit of $ 41 million in the second quarter of 2024.

We recognized the effects of the legislation during the third quarter for the provisions currently enacted, which increased our deferred tax liability.

We anticipate that the legislation will reduce our federal income tax liability and related tax payments for current and future years but will not have a significant impact on our annual effective tax rate.

In 2024, we made tax payments of $ 7 million related to the legal entity reorganization and, in the third quarter of 2025, we received a cash refund of approximately $ 49 million.

We expect to receive an additional $ 3 million cash refund in the fourth quarter of 2025 or early 2026.

Earnings per Share

The computations of basic and diluted earnings per share were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions, except per share data) 2025 2024 2025 2024

20 unchanged sentences

Insurance Contribution Litigation

In April 2012, Allianz Global Risks US Insurance Company sued eighteen insurance companies in a case captioned Allianz Global Risks US Ins.

We have been engaged in litigation in a case captioned Allianz Global Risks US Ins.

ACE Property & Casualty Ins.

Co., et al., Multnomah County Circuit Court (Case No.

Allianz Global Risks US Ins.

(“Allianz”) sought contribution on environmental and product liability claims that Allianz agreed to defend and indemnify on behalf of its insured, Daimler Trucks North America (“DTNA”).

Defendants had insured Freightliner’s assets, which DTNA acquired in 1981.

Con-way, Freightliner’s former parent company, intervened.

We acquired Con-way in 2015.

Con-way and Freightliner had self-insured under fronting agreements with defendant insurers ACE, Westport, and General.

1204-04552) since we acquired Con-way in 2015.

In April 2012, prior to the acquisition, Allianz Global Risks US Ins.

(“Allianz”) filed suit against eighteen insurance companies seeking contribution on environmental and product liability claims that Allianz agreed to defend and indemnify on behalf of its insured, Daimler Trucks North America (“DTNA”).

These claims involved truck and part manufacturing plants of Freightliner, a former subsidiary of Con-way, which Con-way sold to DTNA in 1981.

The defendants had insured Freightliner’s assets and Con-way and Freightliner had self-insured under fronting agreements with three of the defendant insurers, ACE, Westport, and General.

Under those agreements, Con-way agreed to indemnify the fronting carriers for damages assessed under the fronting policies.

Con-way’s captive insurer, Centron, was also a named defendant.

After a seven-week jury trial in 2014, the jury found that Con-way and the fronting insurers never intended that the insurers defend or indemnify any claims against Freightliner.

In connection with the acquisition of Con-way, we became responsible for any potential liability of Con-way related to this matter.

After a seven-week jury trial in 2014, the jury found that Con-way and the fronting insurers never intended that the fronting insurers defend or indemnify any claims against Freightliner.

In June 2015, Allianz appealed to the Oregon Court of Appeals.

1 unchanged sentence

In September 2019, Allianz appealed to the Oregon Supreme Court.

In March 2021, the Oregon Supreme Court reversed the jury verdict, holding that it was an error to allow the jury to decide how the parties intended the fronting policies to operate, and also holding that the trial court improperly instructed the jury concerning one of the pollution exclusions at issue.

In July 2021, the matter was remanded to the trial court for further proceedings consistent with the Oregon Supreme Court’s decision.

In June 2023, the trial court decided the parties’ cross-motions for summary judgment, leaving open the pollution exclusion and allocation issues.

The trial on the pollution exclusion issue took place in October 2024 where the jury issued a favorable verdict for the Company, finding that the pollution exclusion applied to the General policy over several years for which Allianz seeks contribution.

The trial on allocation of defense and indemnity costs among the applicable insurance policies took place during the first half of 2025, with final hearings on allocation currently scheduled for October 2025.

We have accrued an immaterial amount for the potential exposure associated with ultimate allocation to the relevant policies;

however, any losses that may arise in connection with the fronting policies issued by defendant insurers ACE, Westport, and General are not reasonably estimable at this time.

Subsequent Events

In July 2025, we used cash on hand to repay $ 50 million of outstanding principal under the Refinancing Term Loan B-2 Facility, which was scheduled to mature in 2028.

In June 2023, the trial court decided the parties’ cross-motions for summary judgment and determined that the fronting policies do provide coverage for the environmental and product liability claims.

The pollution exclusion and allocation issues remained open.

The trial on the pollution exclusion issue took place in October 2024, where the jury issued a favorable verdict, finding that the pollution exclusion applied to the General policy over several years for which Allianz seeks contribution.

The trial addressing legal and factual issues relating to the allocation of defense and indemnity costs among the applicable insurance policies took place during the first half of 2025 and final hearings on allocation took place in early October 2025.

While the court has not entered a final judgment, we revised our estimate for our share of the liability associated with this matter and recognized a charge of approximately $ 35 million in the third quarter of 2025.

The additional charge we recognized includes an allocation of defense and indemnity costs already incurred by Allianz as well as an estimate of future allocated defense and indemnity costs.

This matter is solely related to a legacy Con-way truck manufacturing business and is unrelated to our current Less-than-Truckload operations.

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