Heartland Express Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 5 August 2026: press release. Guidance figures: 2 lowered, 1 kept. The quarter’s numbers.

Key takeaways

Net income improved to $10.6M: Company posted net income of $10.6 million in second quarter 2026, a swing from net loss of $10.9 million in second quarter 2025. Basic earnings per share was $0.14 versus loss of $0.14 in prior year period. Source
Operating ratio improved 1,490 basis points: Operating ratio of 91.0% in Q2 2026 represents 1,490 basis point improvement versus 105.9% in Q2 2025. Non-GAAP adjusted operating ratio improved to 88.3% from 106.0%. Sequential improvement continued from Q1 2026 at 101.9%. Source
Management attributed improvement to market and operational factors: Improved results reflected stronger freight volumes and improved customer pricing from industry capacity reductions, plus reduced operating costs and strategic asset disposals. Source
Debt reduction accelerated to $135M: Total debt was $134.9 million at June 30, 2026, down from $149.9 million at March 31, 2026. Cumulative debt reduction from initial $494 million in 2022 plus $46.8 million assumed debt totals $406 million reduction. Source

“We are pleased with our operational improvements and profitability as we continue toward our foundational goal of an operating ratio of 85.0% or lower and return to a debt-free balance sheet.”
Mike Gerdin, Chief Executive Officer

Guidance

Area	Period	Figure	Against last quarter
Capital expenditures Source	remainder of 2026	$8 to $14 million	Lowered from $10 to $20 million (full year 2026)
Gains on disposal of property and equipment Source	remainder of 2026	$13 to $19 million	Lowered from $25 to $35 million (full year 2026)
Operating ratio goal Source	ongoing	85.0% or lower	Kept

What changed from last quarter

Guidance lowered: Capital expenditure guidance for remainder of 2026 narrowed to $8-14 million from $10-20 million for full year. Source
Guidance lowered: Gains on disposal of property guidance reduced to $13-19 million for remainder from $25-35 million for full year 2026. Source

Operating profit swing

Net income improved to $10.6M: Company posted net income of $10.6 million in second quarter 2026, a swing from net loss of $10.9 million in second quarter 2025. Basic earnings per share was $0.14 versus loss of $0.14 in prior year period. Source

Operating ratio improvement

Operating ratio improved 1,490 basis points: Operating ratio of 91.0% in Q2 2026 represents 1,490 basis point improvement versus 105.9% in Q2 2025. Non-GAAP adjusted operating ratio improved to 88.3% from 106.0%. Sequential improvement continued from Q1 2026 at 101.9%. Source
Management attributed improvement to market and operational factors: Improved results reflected stronger freight volumes and improved customer pricing from industry capacity reductions, plus reduced operating costs and strategic asset disposals. Source

“The improved financial results delivered reflect stronger freight volumes and improved customer pricing resulting from ongoing industry capacity reductions along with reduced operating costs and strategic disposals of under-utilized assets.”
Mike Gerdin, Chief Executive Officer

Revenue trends

Operating revenue declined due to market consolidation: Operating revenue was $184.1 million in Q2 2026, down from $210.4 million in Q2 2025. Fuel surcharge revenue increased to $31.7 million from $24.5 million, indicating base freight pricing challenges. Source
Six-month revenue declined amid industry consolidation: First half 2026 operating revenue was $360.4 million versus $429.8 million in first half 2025. Fuel surcharge component increased to $54.2 million from $50.8 million, representing modest pricing improvement. Source

Cost management and labor

Salaries and labor costs declined significantly: Salaries, wages and benefits were $69.1 million in Q2 2026 versus $87.2 million in Q2 2025, a reduction of $18.1 million or 20.8%, reflecting driver optimization and operational efficiency improvements. Source
Operations and maintenance expenses reduced: Operations and maintenance costs fell to $12.8 million from $17.4 million year-over-year, a $4.7 million or 27% reduction through improved fleet utilization and maintenance efficiency. Source
Insurance costs decreased with lower claims: Insurance and claims expenses were $11.8 million in Q2 2026 compared to $14.2 million in Q2 2025, reflecting improved safety and loss control. Source

Balance sheet and liquidity

Debt reduction accelerated to $135M: Total debt was $134.9 million at June 30, 2026, down from $149.9 million at March 31, 2026. Cumulative debt reduction from initial $494 million in 2022 plus $46.8 million assumed debt totals $406 million reduction. Source
Smith Transport debt fully retired: All acquisition-related debt and finance lease obligations from Smith Transport acquisition were fully retired in the first three months of 2026, eliminating a historical obligation. Source

Capital allocation and investments

Fleet modernization underway: Average tractor fleet age improved to 2.3 years at June 30, 2026, from 2.6 years at June 30, 2025. Trailer fleet average age improved to 7.1 years from 7.5 years. Company continues disposing excess trailers as market conditions improve. Source
Dividend commitment maintained at $0.02 per share: Company declared regular dividend of $0.02 per share in Q2 2026 and paid on July 6, 2026. Cumulative dividends paid reached $564.5 million over 92 consecutive quarters since 2003, including four special dividends. Source

Strategic initiatives

CFI integration consolidation completed: During first quarter 2026, company completed consolidation of CFI's domestic operations into Heartland Express, including corporate and tractor rebranding. Driver retention was strong during transition, and company identified additional freight options not previously available to CFI.
Operational focus areas outlined: Management continued emphasis on driver utilization, reduction of unproductive miles, and other cost control initiatives. Focus included achieving 85.0% operating ratio goal and returning to debt-free balance sheet.
Fleet investment planned for remainder of 2026: Management expects to invest in fleet of tractors and trailers during remainder of 2026 using positive operating cash flows, alongside continued acquisition debt reduction. Source

Coming up, as management said on 5 August 2026

Fleet tractor and trailer investment: Company expects to make significant investment in fleet tractors and trailers during remainder of 2026 using operating cash flows. Source
Further acquisition debt reduction: Management plans additional reductions of remaining acquisition-related debt using positive operating cash flows. Source
Continued asset disposal as market conditions allow: Company will continue disposing excess trailers within fleet as used equipment market conditions improve. Source

Risks management discussed

External: Industry capacity levels and freight supply-demand dynamics affect pricing power. Management noted improvements resulting from ongoing industry capacity reductions, which could reverse if competitive capacity returns. Source
Operational: Seasonality and weather events impact quarterly results and utilization. Q1 2026 was challenged by normal seasonality combined with significant negative weather events affecting freight volumes.
Financial: Fuel price volatility affects operating costs. Q1 experienced headwind of higher fuel prices compared to beginning of quarter, though fuel surcharge mechanism provides partial offset.

Earlier plans management reported on

On track: Management reaffirmed goal of achieving 85.0% or lower operating ratio. Q2 2026 achieved 91.0%, continuing sequential improvement from 101.9% in Q1 and well below 105.9% in Q2 2025. Source
On track: Debt reduced from initial $494 million (2022) plus $46.8 million assumed to $135 million currently, representing $406 million cumulative reduction. Company using operating cash flows for continued debt reduction. Source
Met: Company maintained regular dividend of $0.02 per share and paid cumulative dividends of $564.5 million over 92 consecutive quarters since 2003. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

July 30, 2026 For Immediate Release

Heartland Express, Inc. Reports Net Income and Financial Results for the Second Quarter of 2026

NORTH LIBERTY, IOWA - July 30, 2026 - Heartland Express, Inc. (Nasdaq: HTLD) announced today financial results for the three and six months ended June 30, 2026.

Three months ended June 30, 2026:

Operating Revenue of $184.1 million,
Net Income of $10.6 million,
Basic Earnings per Share of $0.14,
Operating Ratio of 91.0% (a 1,490bp improvement to Q2 2025) and 88.3% Non-GAAP Adjusted Operating Ratio,
Purchased 172,061 shares of our common stock for $2.3 million,
Payments of $15 million to reduce outstanding acquisition-related debt,
Total Assets of $1.2 billion, including $62.4 million of Cash,
Stockholders' Equity of $756.3 million.

Six months ended June 30, 2026:

Operating Revenue of $360.4 million,
Net Income of $5.8 million,
Basic Earnings per Share of $0.07,
Operating Ratio of 96.3% and 94.9% Non-GAAP Adjusted Operating Ratio,
Smith Transport debt and equipment leases eliminated,
Payments of $25 million to reduce outstanding debt and finance lease obligations. Acquisition-related debt and finance lease obligations reduced from $494 million in 2022 to $135 million.

Heartland Express Chief Executive Officer Mike Gerdin commented on the quarterly operating results and ongoing initiatives of the Company, "Our consolidated operating results for the three months ended June 30, 2026, reflect significant operating ratio improvement (91.0%) as compared to the second quarter of 2025 (105.9%) and sequential non-GAAP adjusted operating ratio improvement in each quarter since the first quarter of 2025. We are pleased with our operational improvements and profitability as we continue toward our foundational goal of an operating ratio of 85.0% or lower and return to a debt-free balance sheet. The improved financial results delivered reflect stronger freight volumes and improved customer pricing resulting from ongoing industry capacity reductions along with reduced operating costs and strategic disposals of under-utilized assets. We expect to rely on our positive cash flows from operations to make a significant investment in our fleet of tractors and trailers over the remainder of the year along with additional reductions of the remaining acquisition-related debt."

Financial Results

For the three months ended June 30, 2026, the Company delivered operating revenues of $184.1 million, compared to $210.4 million in the same period of 2025. Operating revenues for the quarter included fuel surcharge revenues of $31.7 million, compared to $24.5 million in the same period of 2025. Net income was $10.6 million, as compared to a net loss of ($10.9) million in the second quarter of 2025. Basic earnings per share was $0.14 during the quarter, as compared to basic loss per share of $(0.14) in the same period of 2025. The Company posted an operating ratio of 91.0%, non-GAAP adjusted operating ratio of 88.3%, and net income as a percentage of operating revenues of 5.7% in the second quarter of 2026 compared to 105.9%, 106.0%, and (5.2)% (net loss as a percentage of operating revenues) respectively, in the second quarter of 2025.

For the six months ended June 30, 2026, the Company delivered operating revenues of $360.4 million, compared to $429.8 million in the same period of 2025. Operating revenues for the period included fuel surcharge revenues of $54.2 million, compared to $50.8 million in the same period of 2025. Operating income for the six-month period ended June 30, 2026 was $13.3 million, compared to an operating loss of $(27.3) million in the same period of the prior year. Net income was $5.8 million, compared to net loss of $(24.7) million in the same period of the prior year. Basic earnings per share was $0.07 during the six-month period as compared to $(0.32) basic loss per share during the same period of 2025. The Company posted an operating ratio of 96.3%, non-GAAP adjusted operating ratio of 94.9%, and net income as a percentage of operating revenues of 1.6% for the six months ended June 30, 2026 compared to 106.4%, 106.5%, and (5.8)% (net loss as a percentage of operating revenues) respectively, in the same period of the prior year.

Balance Sheet, Liquidity, and Capital Expenditures

As of June 30, 2026, the Company had $62.4 million in cash balances, an increase of $43.9 million since December 31, 2025. Debt of $134.9 million remains at June 30, 2026, down from the initial $447.3 million of borrowings less associated fees for the CFI acquisition in August 2022 along with $46.8 million debt and finance lease obligations assumed from the Smith acquisition in May 2022. The acquisition-related debt and finance lease obligations of Smith Transport were fully retired in the first three months of 2026. There were no borrowings under the Company's unsecured line of credit at June 30, 2026. The Company had $88.8 million in available borrowing capacity on the line of credit as of June 30, 2026 after consideration of $11.2 million of outstanding letters of credit. The Company continues to be in compliance with associated financial covenants. The Company ended the quarter with total assets of $1.2 billion and stockholders' equity of $756.3 million.

Net cash flows from operations for the first six months of 2026 were $36.0 million or 10.0% of operating revenue. The primary uses of cash for financing activities were $25 million used for repayment of debt and financing leases along with $3.1 million for dividends paid and $2.3 million for repurchases of common stock. Cash provided by investing activities included $39.2 million from net property and equipment transactions.

The average age of the Company's consolidated tractor fleet was 2.3 years as of June 30, 2026 compared 2.6 years as of June 30, 2025. The average age of the Company's consolidated trailer fleet was 7.1 years as of June 30, 2026 compared to 7.5 years as of June 30, 2025. We expect to continue to dispose of excess trailers within our fleet as used equipment market conditions improve. For the remainder of 2026, we currently expect net capital expenditures to be approximately $8 to $14 million and $13 to $19 million of gains on disposal of property and equipment.

The Company continues its commitment to stockholders through the payment of cash dividends. Our regular dividend of $0.02 per share was declared during the second quarter of 2026 and paid on July 6, 2026. The Company has now paid cumulative cash dividends of $564.5 million, including four special dividends, ($2.00 in 2007, $1.00 in 2010, $1.00 in 2012, and $0.50 in 2021) over the past ninety-two consecutive quarters since 2003. Our outstanding shares at June 30, 2026 were 77.3 million. A total of 3.0 million shares of common stock have been repurchased for $37.0 million over the past five years. The Company has the ability to repurchase an additional 4.7 million shares under the current authorization which would result in 72.7 million outstanding shares if fully executed.

Other Information

During the second quarter of 2026, our family of operating brands continued to deliver award-winning service and earn corporate trust as Millis Transfer was recognized by Newsweek as one of America's Greatest Midsize Workplaces for Culture, Belonging & Community in 2026.

Operating revenue excluding fuel surcharge revenue, adjusted operating income (loss), and adjusted operating ratio are non-GAAP financial measures and are not intended to replace financial measures calculated in accordance with GAAP. These non-GAAP financial measures supplement our GAAP results. We believe that using these measures affords a more consistent basis for comparing our results of operations from period to period. The information required by Item 10(e) of Regulation S-K under the Securities Act of 1933 and the Securities Exchange Act of 1934 and Regulation G under the Securities Exchange Act of 1934, including a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP, is included in the table at the end of this press release.

Forward-looking statements notice

This press release may contain statements that might be considered as forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases such as “seek,” “expects,” “estimates,” “anticipates,” “projects,” “believes,” “hopes,” “plans,” “goals,” “intends,” “may,” “might,” “likely,” “will,” “should,” “would,” “could,” “potential,” “predict,” “continue,” “strategy,” “future,” “ensure,” “outlook,” and similar terms and phrases. In this press release, the statements relating to freight supply and demand, our ability to react to and capitalize on changing market conditions, the expected impact of operational improvements and strategic changes, progress toward our goals, future capital expenditures, future dispositions of revenue equipment and property and gains therefrom, future profitability, and future stock repurchases, dividends, and debt repayment are forward-looking statements. Such statements are based on management's belief or interpretation of information currently available. These statements and assumptions involve certain risks and uncertainties, and undue reliance should not be placed on such statements. Actual events may differ materially from those set forth in, contemplated by, or underlying such statements as a result of numerous factors, including, without limitation, those specified in the Company's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the quarter ended March 31,

2026. The Company assumes no obligation to update any forward-looking statements, which speak as of their respective dates.

Contact: Heartland Express, Inc. (319-645-7060) Mike Gerdin, Chief Executive Officer Chris Strain, Chief Financial Officer

HEARTLAND EXPRESS, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(unaudited)

	Three Months Ended June 30,		Six Months Ended June 30,
	2026	2025	2026	2025
OPERATING REVENUE	$184,126	$210,387	$360,383	$429,807
OPERATING EXPENSES:
Salaries, wages, and benefits	$69,135	$87,159	$138,230	$180,396
Rent and purchased transportation	10,791	13,343	21,256	27,617
Fuel	40,549	33,709	73,286	71,627
Operations and maintenance	12,784	17,439	24,649	34,718
Operating taxes and licenses	3,765	4,422	7,717	9,163
Insurance and claims	11,783	14,154	24,562	26,076
Communications and utilities	1,977	2,206	3,574	4,471
Depreciation and amortization	32,306	41,463	67,463	83,091
Other operating expenses	9,537	11,693	18,759	24,531
Gain on disposal of property and equipment	(25,050)	(2,782)	(32,367)	(4,566)
	167,577	222,806	347,129	457,124
Operating income (loss)	16,549	(12,419)	13,254	(27,317)
Interest income	370	198	578	326
Interest expense	(1,878)	(2,962)	(4,088)	(6,066)
Income (loss) before income taxes	15,041	(15,183)	9,744	(33,057)
Federal and state income tax (benefit)	4,458	(4,328)	3,982	(8,329)
Net Income (loss)	$10,583	$(10,855)	$5,762	$(24,728)
Income (loss) per share
Basic	$0.14	$(0.14)	$0.07	$(0.32)
Diluted	$0.14	$(0.14)	$0.07	$(0.32)
Weighted average shares outstanding
Basic	77,404	78,079	77,430	78,308
Diluted	77,437	78,142	77,463	78,375
Dividends declared per share	$0.02	$0.02	$0.04	$0.04

	June 30,		December 31,
HEARTLAND EXPRESS, INC.AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except per share amounts)(unaudited)
ASSETS		2026		2025
CURRENT ASSETS
Cash and cash equivalents	$62,385		$18,475
Trade receivables, net	76,658		74,172
Prepaid tires	11,055		11,626
Other current assets	35,696		9,181
Income taxes receivable	-		1,146
Total current assets	185,794		114,600
PROPERTY AND EQUIPMENT	1,003,181		1,148,693
Less accumulated depreciation	432,010		481,471
	571,171		667,222
GOODWILL	322,597		322,597
OTHER INTANGIBLES, NET	67,003		69,512
OTHER ASSETS	15,402		14,686
DEFERRED INCOME TAXES, NET	1,311		1,353
OPERATING LEASE RIGHT OF USE ASSETS	11,513		1,647
	$1,174,791		$1,191,617
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$34,253		$33,479
Compensation and benefits	25,387		25,061
Insurance accruals	28,761		31,437
Long-term debt and finance lease liabilities - current portion	-		5,714
Operating lease liabilities - current portion	3,202		1,330
Other accruals	14,691		13,143
Income taxes payable	10,935		-
Total current liabilities	117,229		110,164
LONG-TERM LIABILITIES
Income taxes payable	5,839		5,427
Long-term debt and finance lease liabilities less current portion	134,890		154,059
Operating lease liabilities less current portion	8,311		317
Deferred income taxes, net	122,550		133,629
Insurance accruals less current portion	29,695		32,702
Total long-term liabilities	301,285		326,134
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Capital stock, common, $.01 par value; authorized 395,000 shares; issued 90,689 in 2026 and 2025; outstanding 77,328 and 77,445 in 2026 and 2025, respectively	907		907
Additional paid-in capital	2,588		2,979
Retained earnings	968,070		965,405
Treasury stock, at cost; 13,361 and 13,244 in 2026 and 2025, respectively	(215,288)		(213,972)
	756,277		755,319
	$1,174,791		$1,191,617

	Three Months Ended June 30,		Six Months Ended June 30,
	2026	2025	2026	2025
	(Unaudited, in thousands)		(Unaudited, in thousands)
GAAP to Non-GAAP Reconciliation Schedule:
Operating revenue excluding fuel surcharge revenue, adjusted operating expenses, adjusted operating income (loss), and adjusted operating ratio reconciliation (a)
Operating revenue	$184,126	$210,387	$360,383	$429,807
Less: Fuel surcharge revenue	31,743	24,509	54,186	50,830
Operating revenue, excluding fuel surcharge revenue	152,383	185,878	306,197	378,977
Operating expenses	167,577	222,806	347,129	457,124
Less: Fuel surcharge revenue	31,743	24,509	54,186	50,830
Less: Amortization of intangibles	1,254	1,254	2,509	2,509
Adjusted operating expenses	134,580	197,043	290,434	403,785
Operating income (loss)	16,549	(12,419)	13,254	(27,317)
Adjusted operating income (loss)	$17,803	$(11,165)	$15,763	$(24,808)
Operating ratio	91.0%	105.9%	96.3%	106.4%
Adjusted operating ratio	88.3%	106.0%	94.9%	106.5%

(a) Operating revenue excluding fuel surcharge revenue, as reported in this press release is based upon operating revenue minus fuel surcharge revenue. Adjusted operating income (loss) as reported in this press release is based upon operating revenue excluding fuel surcharge revenue, less operating expenses, net of fuel surcharge revenue, and non-cash amortization expense related to intangible assets. Adjusted operating ratio as reported in this press release is based upon operating expenses, net of fuel surcharge revenue, and amortization of intangibles, as a percentage of operating revenue excluding fuel surcharge revenue. We believe that operating revenue excluding fuel surcharge revenue, adjusted operating income (loss), and adjusted operating ratio are more representative of our underlying operations by excluding the volatility of fuel prices, which we cannot control. Operating revenue excluding fuel surcharge revenue, adjusted operating income (loss), and adjusted operating ratio are not substitutes for operating revenue, operating income (loss), or operating ratio measured in accordance with GAAP. There are limitations to using non-GAAP financial measures. Although we believe that operating revenue excluding fuel surcharge revenue, adjusted operating income (loss), and adjusted operating ratio improve comparability in analyzing our period-to-period performance, they could limit comparability to other companies in our industry if those companies define such measures differently. Because of these limitations, operating revenue excluding fuel surcharge revenue, adjusted operating income (loss), and adjusted operating ratio should not be considered measures of income generated by our business or discretionary cash available to us to invest in the growth of our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.