Paccar (PCAR) Q4 2025 earnings summary

Executive summary

• 2025 revenues reached $28.44 billion with adjusted net income of $2.64 billion, excluding a $264.5 million after-tax charge for EC-related claims, marking the fourth highest profit year and 87 consecutive years of profitability.

• Fourth quarter revenues were $6.82 billion with net income of $557 million.

• PACCAR Parts and Financial Services achieved record annual revenues and profits, contributing to a structurally stronger business.

• Truck segment accounted for 68% of revenues, parts 24%, and financial services 8%.

• Introduced next-generation battery-electric trucks and opened new facilities, including a parts distribution center in Calgary and an engine remanufacturing facility in Mississippi.

Financial highlights

• Adjusted after-tax return on revenue was 9.3% for 2025; full-year after-tax return on revenues was 8.4%.

• PACCAR Parts annual revenues rose to $6.87 billion, with pre-tax profits of $1.67 billion; fourth quarter revenues increased 4% to $1.74 billion.

• PACCAR Financial Services posted record annual revenues of $2.21 billion and pre-tax income of $485.4 million.

• Fourth quarter truck parts and other gross margins were 12%, with Q1 2026 gross margins expected to rise to 12.5%-13%; parts gross margin in Q4 was 29.5%.

• Cash provided by operations totaled $4.42 billion; dividends declared were $1.43 billion.

Outlook and guidance

• U.S. and Canadian Class 8 truck market forecast for 2026 is 230,000-270,000 vehicles; European above-16-ton truck market expected at 280,000-320,000 registrations; South American above-16-ton market forecasted at 100,000-110,000 trucks.

• Parts sales projected to grow 4%-8% in 2026, with growth accelerating through the year.

• Capital investments planned at $725 million-$775 million and R&D expenses at $450 million-$500 million for 2026.

• Company remains structurally strong and positioned for future growth, emphasizing new truck models, parts growth, and global expansion.