Knight-Swift Transportation (KNX) Q1 2026 earnings summary

Executive summary

• Q1 2026 results were significantly impacted by $18M in LTL arbitration expense, $4.1M Mexico VAT charge, and $12–14M from severe winter weather and fuel costs, resulting in a net loss of $1.3M and a 57.1% drop in operating income, but core operations remain well positioned as market conditions improve.

• Adjusted EPS was $0.09, down from $0.28 in Q1 2025; GAAP EPS was $(0.01) versus $0.19 last year.

• Warehousing saw an ~$11M impact from project deferrals, with costs incurred but revenue delayed to future quarters.

• Market conditions are improving, with tightening truckload capacity, rising spot rates, and shippers increasingly favoring asset-based carriers.

• Regulatory actions are reducing non-compliant capacity, supporting a stronger pricing environment and improved bid activity.

Financial highlights

• Total revenue increased 1.4% year-over-year to $1.85B, with revenue excluding fuel surcharges flat; consolidated operating income fell 57.1% to $28.6M.

• Adjusted operating income declined 42.5% year-over-year; adjusted operating ratio rose to 97.0%, up from 94.7% last year.

• Net income dropped 104.3% year-over-year; adjusted net income was $14.3M, down 68.6%.

• Effective tax rate was 7% GAAP and 28% non-GAAP.

• Free cash flow for the quarter was $56.9M.

Outlook and guidance

• Adjusted EPS for Q2 2026 is projected at $0.45–$0.49, reflecting a strong sequential rebound as Q1 headwinds are not expected to recur.

• Truckload and LTL revenue (ex-fuel surcharge) projected to grow low single digits year-over-year in Q2, with margin improvement and LTL adjusted operating ratio in the low 90s.

• Logistics revenue expected up low-to-mid single digits; Intermodal load count up high single to low double digits sequentially.

• Net cash capital expenditures for 2026 expected at $600M–$650M; effective tax rate for adjusted results at 25.5%–26.5%.

• Margin expansion is expected to accelerate in Q3 and Q4 as new contract rates take effect and market fundamentals improve.