Werner Enterprises Inc 10-Q for FY2025 Q3
Werner Enterprises Inc (WERN)
10-Q
2025-11-07
For: 2025-09-30
View Original
Added on
April 12, 2026
About this 10-Q
Werner Enterprises Inc filed this 10-Q on November 7, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).
Headline figures
Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $771.5M
- up 3.5% from $745.7M a year earlier
- Net loss
- $20.58M
- compared with net income of $6.57M a year earlier
- Diluted EPS
- -$0.34
- compared with $0.11 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
| [Mark | one] | ||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2025
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
Commission File Number: 0-14690
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
| , | ||||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
(402 ) 895-6640
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | ||||||||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||||||||
| Emerging growth company | ||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of October 31, 2025, 59,830,317 shares of the registrant’s common stock, par value $0.01 per share, were outstanding.
WERNER ENTERPRISES, INC.
INDEX
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| Item 2. | ||||||||
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| Item 6. | ||||||||
2
PART I
FINANCIAL INFORMATION
Cautionary Note Regarding Forward-Looking Statements:
This Quarterly Report on Form 10-Q contains historical information and forward-looking statements based on information currently available to our management. The forward-looking statements in this report, including those made in Item 2 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) of Part I, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These safe harbor provisions encourage reporting companies to provide prospective information to investors. Forward-looking statements can be identified by the use of certain words, such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project” and other similar terms and language. We believe the forward-looking statements are reasonable based on currently available information. However, forward-looking statements involve risks, uncertainties and assumptions, whether known or unknown, that could cause our actual results, business, financial condition and cash flows to differ materially from those anticipated in the forward-looking statements. A discussion of important factors relating to forward-looking statements is included in Part I, Item 1A (Risk Factors) of our Annual Report on Form 10-K for the year ended December 31, 2024 (“2024 Form 10-K”). Readers should not unduly rely on the forward-looking statements included in this Form 10-Q because such statements speak only to the date they were made. Unless otherwise required by applicable securities laws, we undertake no obligation or duty to update or revise any forward-looking statements contained herein to reflect subsequent events or circumstances or the occurrence of unanticipated events.
3
Item 1. Financial Statements.
WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (In thousands, except per share amounts) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Operating revenues | $ | $ | $ | $ | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Salaries, wages and benefits | |||||||||||||||||||||||
| Fuel | |||||||||||||||||||||||
| Supplies and maintenance | |||||||||||||||||||||||
| Taxes and licenses | |||||||||||||||||||||||
| Insurance and claims | |||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||
| Rent and purchased transportation | |||||||||||||||||||||||
| Communications and utilities | |||||||||||||||||||||||
| Other | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Operating income (loss) | ( | ||||||||||||||||||||||
| Other expense (income): | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Interest income | ( | ( | ( | ( | |||||||||||||||||||
| Loss (gain) on investments in equity securities | ( | ( | |||||||||||||||||||||
| Loss (earnings) from equity method investment | ( | ( | ( | ||||||||||||||||||||
| Other | ( | ( | |||||||||||||||||||||
| Total other expense, net | |||||||||||||||||||||||
| Income (loss) before income taxes | ( | ||||||||||||||||||||||
| Income tax expense (benefit) | ( | ||||||||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | |||||||||||||||||||||||
| Net income (loss) attributable to Werner | $ | ( | $ | $ | $ | ||||||||||||||||||
| Earnings (loss) per share: | |||||||||||||||||||||||
| Basic | $ | ( | $ | $ | $ | ||||||||||||||||||
| Diluted | $ | ( | $ | $ | $ | ||||||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited).
4
WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (In thousands) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net income (loss) | $ | ( | $ | $ | $ | ||||||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | |||||||||||||||||||||
| Change in fair value of interest rate swaps, net of tax | ( | ( | ( | ( | |||||||||||||||||||
| Other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Comprehensive loss attributable to noncontrolling interest | |||||||||||||||||||||||
| Comprehensive income (loss) attributable to Werner | $ | ( | $ | ( | $ | $ | |||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited).
5
WERNER ENTERPRISES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
| (In thousands, except share amounts) | September 30, 2025 | December 31, 2024 | |||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, trade, less allowance of $ | |||||||||||
| Other receivables | |||||||||||
| Inventories and supplies | |||||||||||
| Prepaid expenses | |||||||||||
| Other current assets | |||||||||||
| Total current assets | |||||||||||
| Property and equipment, at cost | |||||||||||
| Less – accumulated depreciation | |||||||||||
| Property and equipment, net | |||||||||||
| Goodwill | |||||||||||
| Intangible assets, net | |||||||||||
| Other non-current assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Current portion of long-term debt | |||||||||||
| Insurance and claims accruals | |||||||||||
| Accrued payroll | |||||||||||
| Accrued expenses | |||||||||||
| Other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt, net of current portion | |||||||||||
| Other long-term liabilities | |||||||||||
| Insurance and claims accruals, net of current portion | |||||||||||
| Deferred income taxes | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies | |||||||||||
| Temporary equity - redeemable noncontrolling interest | |||||||||||
| Stockholders’ equity: | |||||||||||
Common stock, $ | |||||||||||
| Paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
Treasury stock, at cost; | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities, temporary equity and stockholders’ equity | $ | $ | |||||||||
See Notes to Consolidated Financial Statements (Unaudited).
6
WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| (In thousands) | 2025 | 2024 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Deferred income taxes | ( | ||||||||||
| Gain on disposal of property and equipment | ( | ( | |||||||||
| Non-cash equity compensation | |||||||||||
| Insurance and claims accruals, net of current portion | ( | ( | |||||||||
| Loss (gain) on investments in equity securities | ( | ||||||||||
| Earnings from equity method investment | ( | ( | |||||||||
| Gain on contingent earnout liability settlement | ( | ||||||||||
| Other | ( | ( | |||||||||
| Changes in certain working capital items: | |||||||||||
| Accounts receivable, net | ( | ||||||||||
| Other current assets | ( | ||||||||||
| Accounts payable | ( | ||||||||||
| Other current liabilities | ( | ||||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Additions to property and equipment | ( | ( | |||||||||
| Proceeds from sales of property and equipment | |||||||||||
| Investment in equity securities | ( | ( | |||||||||
| Payments to acquire equity method investment | ( | ( | |||||||||
| Collections of notes receivable | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Repayments of short-term debt | ( | ( | |||||||||
| Proceeds from issuance of short-term debt | |||||||||||
| Repayments of long-term debt | ( | ( | |||||||||
| Proceeds from issuance of long-term debt | |||||||||||
| Dividends on common stock | ( | ( | |||||||||
| Repurchases of common stock | ( | ( | |||||||||
| Tax withholding related to net share settlements of restricted stock awards | ( | ( | |||||||||
| Other | ( | ||||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Effect of exchange rate fluctuations on cash | ( | ||||||||||
| Net increase (decrease) in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents, beginning of period | |||||||||||
| Cash and cash equivalents, end of period | $ | $ | |||||||||
| Supplemental disclosures of cash flow information: | |||||||||||
| Interest paid | $ | $ | |||||||||
| Income taxes paid | |||||||||||
| Supplemental schedule of non-cash investing and financing activities: | |||||||||||
| Notes receivable issued upon sale of property and equipment | $ | $ | |||||||||
| Change in fair value of interest rate swaps | ( | ( | |||||||||
| Property and equipment acquired included in accounts payable | |||||||||||
| Dividends accrued but not yet paid at end of period | |||||||||||
7
WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND
TEMPORARY EQUITY - REDEEMABLE NONCONTROLLING INTEREST
(Unaudited)
| Three Months Ended September 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| (In thousands, except share and per share amounts) | Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total Stockholders’ Equity | Temporary Equity - Redeemable Noncontrolling Interest | ||||||||||||||||||||||||||||||||||
| BALANCE, June 30, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Net loss attributable to Werner | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividends on common stock ($ | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||
| Non-cash equity compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Distribution to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| BALANCE, September 30, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Three Months Ended September 30, 2024 | |||||||||||||||||||||||||||||||||||||||||
| (In thousands, except share and per share amounts) | Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total Stockholders’ Equity | Temporary Equity - Redeemable Noncontrolling Interest | ||||||||||||||||||||||||||||||||||
| BALANCE, June 30, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Net income attributable to Werner | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||
Dividends on common stock ($ | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||
| Non-cash equity compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| BALANCE, September 30, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited).
8
WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND
TEMPORARY EQUITY - REDEEMABLE NONCONTROLLING INTEREST (CONTINUED)
(Unaudited)
| Nine Months Ended September 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| (In thousands, except share and per share amounts) | Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total Stockholders’ Equity | Temporary Equity - Redeemable Noncontrolling Interest | ||||||||||||||||||||||||||||||||||
| BALANCE, December 31, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Net income attributable to Werner | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Repurchases of common stock, | — | — | — | — | ( | ( | — | ||||||||||||||||||||||||||||||||||
Dividends on common stock ($ | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||
Common stock issued for stock-based compensation, including tax effects, | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Non-cash equity compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Distribution to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| BALANCE, September 30, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, 2024 | |||||||||||||||||||||||||||||||||||||||||
| (In thousands, except share and per share amounts) | Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total Stockholders’ Equity | Temporary Equity - Redeemable Noncontrolling Interest | ||||||||||||||||||||||||||||||||||
| BALANCE, December 31, 2023 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| Net income attributable to Werner | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||
Repurchases of common stock, | — | — | — | — | ( | ( | — | ||||||||||||||||||||||||||||||||||
Dividends on common stock ($ | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||
Common stock issued for stock-based compensation, including tax effects, | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||
| Non-cash equity compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| BALANCE, September 30, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited).
9
WERNER ENTERPRISES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(1) Basis of Presentation and Recent Accounting Pronouncements
Basis of Presentation
The accompanying unaudited interim consolidated financial statements include the accounts of Werner Enterprises, Inc. and its subsidiaries (collectively, the “Company” or “Werner”). Redeemable noncontrolling interest on the consolidated condensed balance sheets represents the portion of a consolidated entity in which we do not have a direct equity ownership. In these notes, the terms “we,” “us,” or “our” refer to Werner Enterprises, Inc. and its subsidiaries. All significant intercompany accounts and transactions relating to these entities have been eliminated.
These consolidated financial statements have been prepared in accordance with the U.S. Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and, in the opinion of management, reflect all adjustments, which are all of normal recurring nature, necessary to present fairly the financial condition, results of operations and cash flows for the periods presented in conformity with U.S. generally accepted accounting principles (“GAAP”). These consolidated financial statements do not include all information and footnotes required by GAAP for complete financial statements; although in management’s opinion, the disclosures are adequate so that the information presented is not misleading.
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. In the opinion of management, the information set forth on the accompanying consolidated condensed balance sheets is fairly stated in all material respects in relation to the consolidated balance sheets from which it has been derived.
These consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and accompanying notes contained in our 2024 Form 10-K.
Recently Issued Accounting Pronouncements, Not Yet Effective
In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures, with the objective of enhancing the transparency and decision usefulness of income tax information through income tax disclosure improvements, primarily related to the rate reconciliation and income taxes paid information. The provisions of this update are effective for our annual period ending December 31, 2025, using a prospective approach. We expect the adoption of ASU 2023-09 to impact our disclosures but not our results of operations, cash flows, and financial condition.
In November 2024, the FASB issued ASU 2024-03 Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public business entities to disclose additional information about specific expense categories in the notes to the financial statements at interim and annual reporting periods, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The provisions of this update are effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, using either a prospective or retrospective approach. We are evaluating the impact of adopting ASU 2024-03, and we expect this ASU to impact our disclosures but not our results of operations, cash flows, and financial condition.
In July 2025, the FASB issued ASU 2025-05 Financial Instruments – Credit Losses (Topic 326) – Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient permitting entities to assume that conditions at the balance sheet date remain unchanged for the remaining life of the asset when estimating expected credit losses for current accounts receivable and current contract assets under Topic 606 – Revenue from Contracts with Customers. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and for interim periods within those annual reporting periods, using a prospective approach. We plan to elect the practical expedient upon the adoption of ASU 2025-05 on January 1, 2026, and we do not expect it to have a material impact to our results of operations, cash flows, and financial condition.
In September 2025, the FASB issued ASU 2025-06 Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40), which simplifies the capitalization guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. The amendments in this update permit an entity to apply the new guidance using a prospective, retrospective or modified transition approach. We plan to adopt this ASU for our fiscal year beginning January 1, 2028 using a
10
prospective approach. Although we are evaluating the impact of adopting ASU 2025-06 on our results of operations, cash flows, and financial position, we do not expect a material effect upon adoption.
(2) Revenue
Revenue Recognition
Revenues are recognized over time as control of the promised services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services.
The following table presents our revenues disaggregated by revenue source (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Truckload Transportation Services | $ | $ | $ | $ | |||||||||||||||||||
| Werner Logistics | |||||||||||||||||||||||
| Inter-segment eliminations | ( | ( | ( | ( | |||||||||||||||||||
| Transportation services | |||||||||||||||||||||||
| Other revenues | |||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | |||||||||||||||||||
The following table presents our revenues disaggregated by geographic areas in which we conduct business (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| Mexico | |||||||||||||||||||||||
| Canada | |||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | |||||||||||||||||||
Operating revenues for foreign countries include revenues for (i) shipments with an origin or destination in that country and (ii) other services provided in that country. If both the origin and destination are in a foreign country, the revenues are attributed to the country of origin.
Contract Balances and Accounts Receivable
A receivable is an unconditional right to consideration and is recognized when shipments have been completed and the related performance obligation has been fully satisfied. At September 30, 2025 and December 31, 2024, the accounts receivable, trade, net, balance was $437.5 million and $391.7 million, respectively. Contract assets represent a conditional right to consideration in exchange for goods or services and are transferred to receivables when the rights become unconditional. At September 30, 2025 and December 31, 2024, the balance of contract assets was $7.8 million and $6.3 million, respectively. We have recognized contract assets within the other current assets financial statement caption on the consolidated condensed balance sheets. These contract assets are considered current assets as they will be settled in less than 12 months.
Contract liabilities represent advance consideration received from customers and are recognized as revenues over time as the related performance obligation is satisfied. At September 30, 2025 and December 31, 2024, the balance of contract liabilities was $1.4 1.4 million. We have recognized contract liabilities within the accounts payable and other current liabilities financial statement captions on the consolidated condensed balance sheets. These contract liabilities are considered current liabilities as they will be settled in less than 12 months.
Performance Obligations
We have elected to apply the practical expedient in Accounting Standards Codification (“ASC”) Topic 606, Revenue From Contracts With Customers, to not disclose the value of remaining performance obligations for contracts with an original expected length of one year or less. Remaining performance obligations represent the transaction price allocated to future
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reporting periods for freight shipments started but not completed at the reporting date that we expect to recognize as revenue in the period subsequent to the reporting date; transit times generally average approximately 3 days.
During the nine months ended September 30, 2025 and 2024, revenues recognized from performance obligations related to prior periods (for example, due to changes in transaction price) were not material.
(3) Goodwill and Intangible Assets
Goodwill represents the excess of cost over the fair value of net identifiable tangible and intangible assets acquired in business combinations. There were no changes in the carrying amount of goodwill by segment for the nine months ended September 30, 2025.
The following table presents acquired intangible assets (in thousands):
| September 30, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||||||||||||
Customer relationships | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Trade names | ( | ( | |||||||||||||||||||||||||||||||||
Total intangible assets | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
(4) Leases
We have entered into operating leases primarily for real estate. The leases have terms which range from 2 years to 18 years, and some include options to renew. Renewal terms are included in the lease term when it is reasonably certain that we will exercise the option to renew.
Operating leases are included in other non-current assets, other current liabilities and other long-term liabilities on the consolidated condensed balance sheets. These assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date, using our incremental borrowing rate because the rate implicit in each lease is not readily determinable. We have certain contracts for real estate that may contain lease and non-lease components which we have elected to treat as a single lease component. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense is reported in rent and purchased transportation on the consolidated statements of income.
The following table presents balance sheet and other operating lease information (dollars in thousands):
| September 30, 2025 | December 31, 2024 | ||||||||||
| $ | $ | ||||||||||
| $ | $ | ||||||||||
| Total operating lease liabilities | $ | $ | |||||||||
| Weighted-average remaining lease term for operating leases | |||||||||||
| Weighted-average discount rate for operating leases | % | % | |||||||||
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The following table presents the maturities of operating lease liabilities as of September 30, 2025 (in thousands):
| 2025 (remaining) | $ | ||||
| 2026 | |||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| Thereafter | |||||
| Total undiscounted operating lease payments | |||||
| Less: Imputed interest | ( | ||||
| Present value of operating lease liabilities | $ | ||||
Cash Flows
During the nine months ended September 30, 2025 and 2024, right-of-use assets of $3.4 million and $14.8 million, respectively, were recognized as non-cash asset additions that resulted from new operating lease liabilities. Cash paid for amounts included in the present value of operating lease liabilities was $13.3 million and $8.9 million for the nine months ended September 30, 2025 and 2024, respectively, and are included in operating cash flows.
Operating Lease Expense
Operating lease expense was $7.3 million and $20.5 million for the three and nine months ended September 30, 2025, respectively, and $4.8 million and $14.2 million for the three and nine months ended September 30, 2024, respectively. This expense included $4.5 million and $13.5 million for the three and nine months ended September 30, 2025, respectively, and $3.2 million and $9.1 million for the three and nine months ended September 30, 2024, respectively, for long-term operating leases, with the remainder for variable and short-term lease expense.
Lessor Operating Leases
We are the lessor of tractors and trailers (revenue equipment) under operating leases with initial terms of 1 year to 10 years. At times, we also lease or sublease real estate to third parties. We recognize revenue for such leases on a straight-line basis over the term of the lease. were $3.1 million and $8.6 million for the three and nine months ended September 30, 2025, respectively, and $2.3 million and $7.1 million for the three and nine months ended September 30, 2024, respectively.
The following table presents information about the maturities of these operating leases as of September 30, 2025 (in thousands):
| 2025 (remaining) | $ | ||||
| 2026 | |||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| Thereafter | |||||
| Total | $ | ||||
The owned assets underlying our leases as lessor primarily consist of revenue equipment. As of September 30, 2025 and December 31, 2024, the gross carrying value of such revenue equipment underlying these leases was $66.0 million and $61.8 million, respectively, and accumulated depreciation was $28.2 million and $26.7 million, respectively. Depreciation expense for these assets was $2.2 million and $6.3 million for the three and nine months ended September 30, 2025, respectively, and $1.8 million and $5.4 million for the three and nine months ended September 30, 2024, respectively.
(5) Fair Value
Fair Value Measurement — Definition and Hierarchy
ASC 820-10, Fair Value Measurement, defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.
ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable
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inputs reflect the assumptions market participants would use in pricing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances.
The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows:
Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access.
Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Such inputs include quoted prices in markets that are not active, quoted prices for similar assets and liabilities in active and inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3 — Unobservable inputs for the asset or liability, where there is little, if any, observable market activity or data for the asset or liability.
In general, and where applicable, we use quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology applies to our Level 1 assets and liabilities. If quoted prices in active markets for identical assets and liabilities are not available to determine fair value, then we use quoted prices for similar assets and liabilities or inputs other than the quoted prices that are observable, either directly or indirectly. This pricing methodology would apply to Level 2 assets and liabilities.
The following table presents the fair value hierarchy for our assets and liabilities measured at fair value on a recurring basis (in thousands):
| Level in Fair Value Hierarchy | Fair Value | |||||||||||||||||||
| September 30, 2025 | December 31, 2024 | |||||||||||||||||||
| Assets: | ||||||||||||||||||||
| Other non-current assets: | ||||||||||||||||||||
Pay-fixed interest rate swaps (1) | 2 | $ | $ | |||||||||||||||||
Equity securities (2) | 2 | |||||||||||||||||||
| Total other non-current assets | $ | $ | ||||||||||||||||||
| Liabilities: | ||||||||||||||||||||
| Other current liabilities: | ||||||||||||||||||||
Pay-fixed interest rate swaps (1) | 2 | $ | $ | |||||||||||||||||
| Other long-term liabilities: | ||||||||||||||||||||
Pay-fixed interest rate swaps (1) | 2 | |||||||||||||||||||
| Contingent consideration associated with acquisition | 3 | |||||||||||||||||||
| Total other long-term liabilities | ||||||||||||||||||||
| Total liabilities at fair value | $ | $ | ||||||||||||||||||
(1) Pay-fixed interest rate swaps are measured on a recurring basis by netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on the expectation of future interest rates (forward curves) derived from observed market interest rate curves. See Note 7 – Debt and Credit Facilities for further information on our interest rate swaps.
(2) Represents our investment in an autonomous technology company. For additional information regarding the valuation of this equity security, see Note 6 – Investments.
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The following table presents changes in the fair value of our contingent earnout liability (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
Balance at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Payment for contingent consideration (1) | ( | |||||||||||||||||||||||||
Change in fair value (2) | ( | |||||||||||||||||||||||||
Balance at end of period | $ | $ | $ | $ | ||||||||||||||||||||||
(1) The final outcome of the contingent consideration arrangement related to the Baylor Trucking, Inc. acquisition was negotiated and paid in April 2025, as certain financial performance goals were achieved.
(2) Represents a net favorable change to the contingent earnout liability during the nine months ended September 30, 2025, resulting from the finalization of the Baylor Trucking, Inc. contingent consideration arrangement in April 2025.
The estimated fair value of our contingent consideration arrangement was based upon probability-adjusted inputs for the acquired entity. Additionally, as the liability was stated at present value, the passage of time alone increased the estimated fair value of the liability each reporting period. Change in fair value is recorded in other operating expenses on the consolidated statements of income.
We have ownership interests in investments, primarily Mastery Logistics Systems, Inc. (“MLSI”), which do not have readily determinable fair values and are accounted for using the measurement alternative in ASC 321, Investments - Equity Securities. Our ownership interest in Autotech Fund III, L.P. (the “Autotech Fund”) is accounted for under ASC 323, Investments - Equity Method and Joint Ventures. For additional information regarding the valuation of these investments, see Note 6 – Investments.
Fair Value of Financial Instruments Not Recorded at Fair Value
Cash and cash equivalents, accounts receivable trade, and accounts payable are short-term in nature and accordingly are carried at amounts that approximate fair value. The carrying amount of our variable-rate long-term debt approximates fair value due to the duration of our credit arrangements and the variable interest rates.
(6) Investments
Equity Investments without Readily Determinable Fair Values
Our strategic equity investments without readily determinable fair values primarily consist of our investment in MLSI, a transportation management systems company. MLSI has developed a cloud-based transportation management system using its SaaS technology, and we have obtained a license. Our investments are being accounted for under ASC 321 using the measurement alternative and are recorded in other noncurrent assets on the consolidated condensed balance sheets. We record changes in the values of our investments based on events that occur that would indicate the values have changed, in loss (gain) on investments in equity securities on the consolidated statements of income. As of September 30, 2025 and December 31, 2024, the value of our investment in MLSI was $109.9 million and $103.9 million, respectively, and the value of our other equity investments without readily determinable fair values was $390 thousand and $358 thousand, respectively. No gains or losses were recorded for the three and nine months ended September 30, 2025 and 2024.
The following table summarizes the activity related to our equity investments without readily determinable fair values during the periods presented (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
Investment in equity securities | $ | $ | $ | $ | |||||||||||||||||||
As of September 30, 2025, cumulative upward adjustments on our equity securities without readily determinable fair values totaled $64.9 million.
Equity Investments with Readily Determinable Fair Values
We own a strategic minority equity investment in an autonomous technology company, which is being accounted for under ASC 321 and is recorded in other noncurrent assets on the consolidated condensed balance sheets. As of September 30, 2025 and December 31, 2024, the value of this investment was $0.1
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The following table summarizes the activity related to our equity investments with readily determinable fair values during the periods presented (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Loss (gain) on investments in equity securities | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Equity Method Investment
In January 2023, we committed to make a $20.0 million investment in the Autotech Fund pursuant to a limited partnership agreement. The Autotech Fund is managed by Autotech Ventures, a venture capital firm focused on ground transportation technology. Our interest, which represents an ownership percentage of less than 20 %, is being accounted for under ASC 323. As a limited partner, we will make periodic capital contributions toward this total commitment amount. As of September 30, 2025 and December 31, 2024, the value of our investment in the Autotech Fund was $10.3 million and $6.7 million, respectively, and is recorded in other noncurrent assets on the consolidated condensed balance sheets. The carrying amount of the Autotech Fund as of September 30, 2025 was updated using operating results through June 30, 2025, as this is the most recent information available to us at this time.
The following table summarizes the activity related to our equity method investment during the periods presented (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Capital contributions | $ | $ | $ | $ | ||||||||||||||||||||||
| Loss (earnings) from equity method investment | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
(7) Debt and Credit Facilities
On December 20, 2022, we entered into a $1.075 billion unsecured credit facility with a group of lenders (the “2022 Credit Agreement”), replacing our previous credit facilities. The 2022 Credit Agreement is scheduled to mature on December 20, 2027, and has a $100.0 million maximum limit for the aggregate amount of letters of credit issued.
Revolving credit loans drawn under the 2022 Credit Agreement bear interest, at our option, at (i) the Base Rate (the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus 0.50 %, or (c) the one-month Term Secured Overnight Financing Rate (“SOFR”) plus 1.10 %), plus a margin ranging between 0.125 % and 0.750 %, or (ii) Term SOFR plus 0.10 % and a margin ranging between 1.125 % and 1.750 %. Swingline loans drawn under the 2022 Credit Agreement bear interest at the Base Rate, as defined above, plus a margin ranging between 0.125 % and 0.750 %. The 2022 Credit Agreement also requires us to pay quarterly (i) a letter of credit commission on the daily amount available to be drawn under such standby letters of credit at rates ranging between 1.125 % and 1.750 % per annum and (ii) a nonrefundable commitment fee on the average daily unused amount of the commitment at rates ranging between 0.125 % and 0.250 % per annum. The margin, letter of credit commission, and commitment fee rates are based on our ratio of net funded debt to earnings before interest, income taxes, depreciation and amortization (“EBITDA”). There are no scheduled principal payments due on the 2022 Credit Agreement until the maturity date, and interest is payable in arrears at periodic intervals not to exceed three months.
Availability of such funds under the 2022 Credit Agreement is conditional upon various customary terms and covenants. Such covenants include, among other things, two financial covenants requiring us (i) not to exceed a maximum ratio of net funded debt to EBITDA and (ii) to exceed a minimum ratio of EBITDA to interest expense. As of September 30, 2025, we were in compliance with these covenants.
We have entered into variable-for-fixed interest rate swap agreements in order to limit our exposure to increases in interest rates on a portion of our variable-rate indebtedness. Under the terms of our interest rate swap agreements, we receive monthly variable-rate interest payments based on one-month Term SOFR and make monthly fixed-rate interest payments as specified in the interest rate swap agreements. We have designated our interest rate swap agreements as cash flow hedges. Changes in fair value of outstanding derivatives in cash flow hedges are recorded in other comprehensive income (loss) in the consolidated statements of comprehensive income until earnings are impacted by the hedged transactions. In July 2025, two variable-for-fixed interest rate swap agreements with an aggregate notional amount of $40.0 million matured and we entered into two variable-for-fixed interest rate swap agreements with an aggregate notional amount of $60.0 million, maturing in July 2028.
On March 27, 2025, the Company and Werner Receivables Company, LLC (“WRC”), a newly-formed wholly-owned subsidiary of the Company, entered into a Loan Security Agreement (“LSA”) with various lenders. The LSA is scheduled to terminate on March 27, 2028, unless extended by the parties and is subject to earlier termination as provided in the LSA. The
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LSA is a secured borrowing that is collateralized by eligible receivables, for which the Company is the servicing agent. WRC is a bankruptcy remote, special purpose entity and the borrower under the LSA. The Company has contributed and from time to time sells a designated pool of eligible accounts receivables to WRC which, in turn, may borrow funds under the LSA on a revolving basis. The collateral is available to satisfy the claims related to the lenders’ interests in the receivables and unavailable to satisfy claims of the Company and its subsidiaries. The LSA does not qualify for sale treatment. Accordingly, the Company’s eligible receivables remain on our condensed consolidated balance sheets in accounts receivable, trade, less allowance.
Subject to eligible receivables, the maximum amount of funding available to WRC is $300.0 million, which may increase to $350.0 million upon WRC’s request and acceptance by the lenders. Subsequent to the end of the quarter, on October 7, 2025, we entered into an amendment to the LSA, increasing the maximum funding available from $300.0 million to $325.0 million. Borrowings under the LSA bear interest at (i) a commercial paper rate or (ii) one-month Term SOFR, plus 0.10 %. The LSA also requires us to pay nonrefundable drawn and undrawn fees on the average daily used and unused amounts of the commitment, respectively.
The LSA is subject various affirmative and negative covenants, representations and warranties, and default and termination provisions customary for facilities of this type, including a minimum borrower’s net worth covenant. As of September 30, 2025, we were in compliance with these covenants.
The following table presents total debt (in thousands):
| September 30, 2025 | December 31, 2024 | ||||||||||
| Current portion of long-term debt | |||||||||||
2022 Credit Agreement | $ | $ | |||||||||
| Long-term debt, net of current portion | |||||||||||
2022 Credit Agreement (1) | |||||||||||
LSA (weighted average interest rate of | |||||||||||
| Total long-term debt, net of current portion | |||||||||||
| Total debt | $ | $ | |||||||||
(1) As of September 30, 2025, our outstanding revolving credit loan balance under the 2022 Credit Agreement consisted of:
•$50.0 million at a weighted average variable interest rate of 5.85 %;
•$90.0 million which is effectively fixed at 6.12 % with interest rate swap agreements through July 2026;
•$75.0 million which is effectively fixed at 6.23 % with an interest rate swap agreement through April 2027;
•$75.0 million which is effectively fixed at 6.09 % with an interest rate swap agreement through May 2027;
•$75.0 million which is effectively fixed at 5.14 % with an interest rate swap agreement through August 2028; and
•$60.0 million which is effectively fixed at 5.15 % with interest rate swap agreements through July 2028.
Our total available borrowing capacity was $644.1 million as of September 30, 2025, consisting of $644.1 million under the 2022 Credit Agreement after considering $5.9 million in stand-by letters of credit under which we are obligated. As of September 30, 2025, no borrowing capacity was available under the LSA.
Availability under the LSA is calculated as follows (in thousands):
| September 30, 2025 | |||||||||||
| Borrowing base, based on eligible receivables | $ | ||||||||||
| Less: outstanding borrowings | ( | ||||||||||
| Availability under LSA | $ | ||||||||||
During October 2025, subsequent to entering into the LSA amendment, we borrowed an additional $25.0 million under our LSA and we repaid $10.0 million on our revolving line of credit.
For information regarding the fair value of our debt, see Note 5 – Fair Value.
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At September 30, 2025, the aggregate maturities of future debt principal payments are as follows (in thousands):
| 2025 (remaining) | $ | ||||
| 2026 | |||||
| 2027 | |||||
| 2028 | |||||
| Total | $ | ||||
(8) Income Taxes
On July 4, 2025, the United States enacted a budget reconciliation package known as the One Big Beautiful Bill Act (“OBBBA”), which includes significant provisions such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017 and the restoration of favorable tax treatments for certain business provisions. ASC 740, Income Taxes, requires entities to recognize the effects of new income tax legislation on deferred tax balances in the reporting period in which the legislation is enacted. We recorded the effects of the OBBBA on deferred tax balances during the third quarter ended September 30, 2025. The new legislation did not have a material effect on our results of operations and financial condition but it did have a favorable impact on our cash flows for the nine months ended September 30, 2025, resulting from the reinstatement of 100% bonus depreciation for qualified property.
(9) Commitments and Contingencies
We have committed to property and equipment purchases of approximately $82.1 million at September 30, 2025.
We are involved in certain claims and pending litigation, including those described herein, arising in the ordinary course of business. The majority of these claims relate to bodily injury, property damage, cargo and workers’ compensation incurred in the transportation of freight, as well as certain class action litigation related to personnel and employment matters. We accrue for the uninsured portion of contingent losses from these and other pending claims when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on the knowledge of the facts, management believes the resolution of claims and pending litigation, taking into account existing reserves, will not have a material adverse effect on our consolidated financial statements. Moreover, the results of complex legal proceedings are difficult to predict, and our view of these matters may change in the future as the litigation and related events unfold.
On May 17, 2018, in Harris County District Court in Houston, Texas, a jury rendered an adverse verdict against the Company in a lawsuit arising from a December 30, 2014 accident between a Werner tractor-trailer and a passenger vehicle. On July 30, 2018, the court entered a final judgment against Werner for $92.0 million, including pre-judgment interest. The Company pursued an appeal of this verdict, and on May 18, 2023, the Texas Court of Appeals overruled Werner’s appeal and affirmed the trial court’s judgment. The Company filed a Petition for Review with the Texas Supreme Court and, on August 30, 2024 the Texas Supreme Court granted the Company’s Petition for Review. Oral argument of the appeal was held on December 3, 2024. On June 27, 2025, the Texas Supreme Court reversed the verdict and rendered a judgment in the Company’s favor. The plaintiffs filed a Motion for Rehearing and, on September 26, 2025, the Texas Supreme Court denied the Motion, ending the case in favor of Werner.
Under the Company’s insurance policies in effect on the date of this accident, the Company’s maximum liability for this accident was $10.0 million (plus pre-judgment and post-judgment interest) with premium-based coverage that exceeded the 2018 jury verdict amount. As a result of the June 27, 2025 decision, the Company reversed a $45.7 million liability (including interest) through insurance and claims expense on the statements of income during the three months ended June 30, 2025. In June 2025, the Company also reversed a $79.2
In October 2025, we reached an agreement with the plaintiffs in the consolidated class action lawsuits entitled Abarca et al. v. Werner that are pending in the United States District Court for the District of Nebraska, to settle these cases for a combined $18.0 million after more than a decade of litigation. The proceeding was instituted on June 4, 2014 in the Superior Court for Alameda County, California and was transferred to the United States District Court for the District of Nebraska on October 20,
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(10) Earnings (Loss) Per Share
Basic earnings (loss) per share is computed by dividing net income (loss) attributable to Werner by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income (loss) attributable to Werner by the weighted average number of common shares outstanding plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding restricted stock awards. Performance awards are excluded from the calculation of dilutive potential common shares until the threshold performance conditions have been satisfied. Since the Company had a net loss for the three months ended September 30, 2025, diluted loss per share is the same as basic loss per share as the inclusion of potential common shares outstanding would have been antidilutive. The potential shares of common stock that were excluded from the computation of diluted loss per share for the three months ended September 30, 2025, were 180 shares. There are no differences in the numerators of our computations of basic and diluted earnings (loss) per share for any periods presented.
The computation of basic and diluted earnings (loss) per share is shown below (in thousands, except per share amounts).
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income (loss) attributable to Werner | $ | ( | $ | $ | $ | ||||||||||||||||||
| Weighted average common shares outstanding | |||||||||||||||||||||||
| Dilutive effect of stock-based awards | |||||||||||||||||||||||
| Shares used in computing diluted earnings (loss) per share | |||||||||||||||||||||||
| Basic earnings (loss) per share | $ | ( | $ | $ | $ | ||||||||||||||||||
| Diluted earnings (loss) per share | $ | ( | $ | $ | $ | ||||||||||||||||||
(11) Segment Information
We have two reportable segments – Truckload Transportation Services (“TTS”) and Werner Logistics.
The TTS reportable segment consists of two operating segments, Dedicated and One-Way Truckload. These operating segments are aggregated because they have similar economic characteristics and meet the other aggregation criteria described in the accounting guidance for segment reporting. Dedicated provides truckload services dedicated to a specific customer, generally for a retail distribution center or manufacturing facility, utilizing either dry van or specialized trailers. One-Way Truckload is comprised of the following operating fleets: (i) the medium-to-long-haul van (“Van”) fleet transports a variety of consumer nondurable products and other commodities in truckload quantities over irregular routes using dry van trailers, including Mexico cross-border routes; (ii) the expedited (“Expedited”) fleet provides time-sensitive truckload services utilizing driver teams; (iii) the regional short-haul (“Regional”) fleet provides comparable truckload van service within geographic regions across the United States; and (iv) the Temperature Controlled fleet provides truckload services for temperature sensitive products over irregular routes utilizing temperature-controlled trailers. Revenues for the TTS segment include a small amount of non-trucking revenues which consist primarily of the intra-Mexico portion of cross-border shipments delivered to or from Mexico where we utilize a third-party capacity provider.
The Werner Logistics segment provides non-asset-based transportation and logistics services. Werner Logistics provides services throughout North America and generates the majority of our non-trucking revenues through three divisions. These three Werner Logistics divisions are as follows: (i) Truckload Logistics, which uses contracted carriers to complete shipments for brokerage customers and freight management customers for which we offer a full range of single-source logistics management services and solutions; (ii) the Intermodal (“Intermodal”) division offers rail transportation through alliances with rail and drayage providers as an alternative to truck transportation; and (iii) Werner Final Mile (“Final Mile”) offers residential and commercial deliveries of large or heavy items using third-party agents, independent contractors, and Company employees with two-person delivery teams operating a liftgate straight truck.
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The accounting policies of the segments are the same as those described in the summary of significant accounting policies contained in our 2024 Form 10-K. Inter-segment transactions between reporting segments have been recorded at amounts approximating market and are eliminated in consolidation.
The chief operating officer of the Company is our chief operating decision maker (“CODM”). Our CODM evaluates the operating results of each individual segment, using monthly divisional financial statements, to asses performance and to allocate resources to each segment. Our divisional financial statements detail the revenues and operating expenses of each individual segment netting to operating income (loss) that allows the CODM to make operational decisions regarding each individual segment.
We do not prepare separate balance sheets by segment and, as a result, assets are not separately identifiable by segment. Based on our operations, certain revenue-generating assets (primarily tractors and trailers) are interchangeable between segments. Depreciation for these interchangeable assets is allocated to segments based on the actual number of units utilized by the segment during the period. Other depreciation and amortization is allocated to segments based on specific identification or as a percentage of a metric such as average number of tractors.
The following tables summarize our segment information (in thousands):
| Three Months Ended September 30, 2025 | |||||||||||||||||
| Truckload Transportation Services | Werner Logistics | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Inter-segment revenues | |||||||||||||||||
| Reportable segment revenues | |||||||||||||||||
Reconciliation of revenues: | |||||||||||||||||
Other revenues (1) | |||||||||||||||||
| Elimination of inter-segment revenues | ( | ||||||||||||||||
| Consolidated revenues | $ | ||||||||||||||||
Less operating expenses: (2) | |||||||||||||||||
Salaries, wages and benefits (3) | |||||||||||||||||
| Fuel | |||||||||||||||||
| Supplies and maintenance | |||||||||||||||||
| Taxes and licenses | |||||||||||||||||
| Insurance and claims | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Rent and purchased transportation | |||||||||||||||||
| Communications and utilities | |||||||||||||||||
| Gains on sales of property and equipment | ( | ( | ( | ||||||||||||||
Other segment items (5) | |||||||||||||||||
| Reportable segment operating expenses | |||||||||||||||||
| Reportable segment operating income (loss) | $ | ( | $ | $ | ( | ||||||||||||
Reconciliation of operating income: | |||||||||||||||||
Other operating loss (1) | ( | ||||||||||||||||
| Consolidated operating loss | $ | ( | |||||||||||||||
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| Three Months Ended September 30, 2024 | |||||||||||||||||
| Truckload Transportation Services | Werner Logistics | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Inter-segment revenues | |||||||||||||||||
| Reportable segment revenues | |||||||||||||||||
Reconciliation of revenues: | |||||||||||||||||
Other revenues (1) | |||||||||||||||||
| Elimination of inter-segment revenues | ( | ||||||||||||||||
| Consolidated revenues | $ | ||||||||||||||||
Less operating expenses: (2) | |||||||||||||||||
| Salaries, wages and benefits | |||||||||||||||||
| Fuel | |||||||||||||||||
| Supplies and maintenance | |||||||||||||||||
| Taxes and licenses | |||||||||||||||||
| Insurance and claims | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Rent and purchased transportation | |||||||||||||||||
| Communications and utilities | |||||||||||||||||
| Gains on sales of property and equipment | ( | ( | ( | ||||||||||||||
Other segment items (5) | |||||||||||||||||
| Reportable segment operating expenses | |||||||||||||||||
| Reportable segment operating income (loss) | $ | $ | ( | $ | |||||||||||||
Reconciliation of operating income: | |||||||||||||||||
Other operating loss (1) | ( | ||||||||||||||||
| Consolidated operating income | $ | ||||||||||||||||
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| Nine Months Ended September 30, 2025 | |||||||||||||||||
| Truckload Transportation Services | Werner Logistics | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Inter-segment revenues | |||||||||||||||||
| Reportable segment revenues | |||||||||||||||||
Reconciliation of revenues: | |||||||||||||||||
Other revenues (1) | |||||||||||||||||
| Elimination of inter-segment revenues | ( | ||||||||||||||||
| Consolidated revenues | $ | ||||||||||||||||
Less operating expenses: (2) | |||||||||||||||||
Salaries, wages and benefits (3) | |||||||||||||||||
| Fuel | |||||||||||||||||
| Supplies and maintenance | |||||||||||||||||
| Taxes and licenses | |||||||||||||||||
Insurance and claims (4) | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Rent and purchased transportation | |||||||||||||||||
| Communications and utilities | |||||||||||||||||
| Gains on sales of property and equipment | ( | ( | ( | ||||||||||||||
Other segment items (5) | |||||||||||||||||
| Reportable segment operating expenses | |||||||||||||||||
| Reportable segment operating income | $ | $ | $ | ||||||||||||||
Reconciliation of operating income: | |||||||||||||||||
Other operating loss (1) | ( | ||||||||||||||||
| Consolidated operating income | $ | ||||||||||||||||
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| Nine Months Ended September 30, 2024 | |||||||||||||||||
| Truckload Transportation Services | Werner Logistics | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Inter-segment revenues | |||||||||||||||||
| Reportable segment revenues | |||||||||||||||||
Reconciliation of revenues: | |||||||||||||||||
Other revenues (1) | |||||||||||||||||
| Elimination of inter-segment revenues | ( | ||||||||||||||||
| Consolidated revenues | $ | ||||||||||||||||
Less operating expenses: (2) | |||||||||||||||||
| Salaries, wages and benefits | |||||||||||||||||
| Fuel | |||||||||||||||||
| Supplies and maintenance | |||||||||||||||||
| Taxes and licenses | |||||||||||||||||
| Insurance and claims | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Rent and purchased transportation | |||||||||||||||||
| Communications and utilities | |||||||||||||||||
| Gains on sales of property and equipment | ( | ( | ( | ||||||||||||||
Other segment items (5) | |||||||||||||||||
| Reportable segment operating expenses | |||||||||||||||||
| Reportable segment operating income (loss) | $ | $ | ( | $ | |||||||||||||
Reconciliation of operating income: | |||||||||||||||||
Other operating loss (1) | ( | ||||||||||||||||
| Consolidated operating income | $ | ||||||||||||||||
(1) Revenues and operating income or loss from segments below the quantitative thresholds for determining reportable segments. Those segments include driver training schools, transportation-related activities such as third-party equipment maintenance and equipment leasing, other business activities, and corporate related items which are incidental to our activities and are not attributable to any of our operating segments.
(2) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. Inter-segment expenses are included within the amounts shown.
(3) During the three and nine months ended September 30, 2025, salaries, wages and benefits for the TTS segment included costs of $18.0 0.9 million and $0.4 million, respectively, related to cost saving initiatives.
(4) During the nine months ended September 30, 2025, insurance and claims expense for the TTS segment was offset by a $45.7 million liability reversal as a result of a favorable decision related to a lawsuit arising from a December 2014 accident. For additional information regarding legal proceedings, see Note 9 – Commitments and Contingencies.
(5) Other segment items for each reportable segment primarily includes costs for professional services. During the three months ended September 30, 2025, the TTS segment incurred legal fees of $3.4 million related to the Abarca et al. v. Werner litigation discussed above. During the nine months ended September 30, 2025, other segment items for the TTS segment were partially offset by a net favorable change of $7.8 million to the contingent earnout liability related to the Baylor Trucking, Inc. acquisition. For additional information regarding this contingent consideration arrangement, see Note 5 – Fair Value.
(12) Subsequent Events
On October 7, 2025, we entered into an amendment to the LSA, increasing the maximum funding available from $300.0 million to $325.0 million. During October 2025, subsequent to entering into this amendment, we borrowed an additional $25.0 million
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under our LSA and we repaid $10.0 million on our revolving line of credit. For additional information regarding our credit facilities, see Note 7 – Debt and Credit Facilities.
In October 2025, we reached an agreement with the plaintiffs in the consolidated class action lawsuits entitled Abarca et al. v. Werner that are pending in the United States District Court for the District of Nebraska, to settle these cases for a combined $18.0 million after more than a decade of litigation. The settlement is subject to court approval. The cases involved a variety of allegations brought by a small group of drivers and later certified as a class action with tens of thousands of class members, covering the years from mid-2010 to late 2023. For additional information regarding legal proceedings, see Note 9 – Commitments and Contingencies.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Management’s Discussion and Analysis of Financial Condition and Results of Operations (the “MD&A”) summarizes the financial statements from management’s perspective with respect to our financial condition, results of operations, liquidity and other factors that may affect actual results. The MD&A is organized in the following sections:
•Overview
•Results of Operations
•Liquidity and Capital Resources
•Regulations
•Critical Accounting Estimates
The MD&A should be read in conjunction with our 2024 Form 10-K.
Overview:
We have two reportable segments, TTS and Werner Logistics, and we operate in the truckload and logistics sectors of the transportation industry. In the truckload sector, we focus on transporting consumer nondurable products that generally ship more consistently throughout the year. In the logistics sector, besides managing transportation requirements for individual customers, we provide additional sources of truck capacity, alternative modes of transportation, a North American delivery network and systems analysis to optimize transportation needs. Our success depends on our ability to efficiently and effectively manage our resources in the delivery of truckload transportation and logistics services to our customers. Resource requirements vary with customer demand, which may be subject to seasonal or general economic conditions. Our ability to adapt to changes in customer transportation requirements is essential to efficiently deploy resources and make capital investments in tractors and trailers (with respect to our TTS segment) or obtain qualified third-party capacity at a reasonable price (with respect to our Werner Logistics segment). We may also be affected by our customers’ financial failures or loss of customer business.
Revenues for the operating segments (Dedicated and One-Way Truckload) within our TTS reportable segment are typically generated on a per-mile basis and also include revenues such as stop charges, loading and unloading charges, equipment detention charges and equipment repositioning charges. To mitigate our risk to fuel price increases, we recover additional fuel surcharge revenues from our customers that generally recoup a majority of the increased fuel costs; however, we cannot assure that current recovery levels will continue in future periods. Because fuel surcharge revenues fluctuate in response to changes in fuel costs, we identify them separately and exclude them from the statistical calculations to provide a more meaningful comparison between periods. The key statistics used to evaluate trucking revenues, net of fuel surcharge, are (i) average revenues per tractor per week, (ii) One-Way Truckload average revenues per total mile, (iii) average percentage of empty miles (miles without trailer cargo), (iv) average trip length (in loaded miles) and (v) average number of tractors in service. General economic conditions, seasonal trucking industry freight patterns and industry capacity are important factors that impact these statistics. Our TTS segment also generates a small amount of revenues categorized as non-trucking revenues, which consist primarily of the intra-Mexico portion of cross-border shipments delivered to or from Mexico where the TTS segment utilizes a third-party capacity provider. We exclude such revenues from the statistical calculations.
Our most significant resource requirements are company drivers, independent contractors, tractors, and trailers with respect to our TTS segment and qualified third-party capacity providers with respect to our Werner Logistics segment. Independent contractors supply their own tractors and drivers and are responsible for their operating expenses. Our financial results are affected by company driver and independent contractor availability and the markets for new and used revenue equipment. We are self-insured for a significant portion of bodily injury, property damage and cargo claims; workers’ compensation claims; and associate health claims (supplemented by premium-based insurance coverage above certain dollar levels). For that reason, our financial results may also be affected by driver safety, medical costs, weather, legal and regulatory environments and insurance coverage costs to protect against catastrophic losses.
The operating ratio is a common industry measure used to evaluate our profitability and that of our TTS segment operating fleets. The operating ratio consists of operating expenses expressed as a percentage of operating revenues. The most significant
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variable expenses that impact the TTS segment are driver salaries and benefits, fuel, fuel taxes (included in taxes and licenses expense), payments to independent contractors (included in rent and purchased transportation expense), supplies and maintenance and insurance and claims. As discussed further in the comparison of operating results for third quarter 2025 to third quarter 2024, several industry-wide issues have caused, and could continue to cause, costs to increase in future periods. These issues include shortages of drivers or independent contractors, changing fuel prices, changing used truck and trailer pricing, compliance with new or proposed regulations and tightening of the commercial truck liability insurance market. Our main fixed costs include depreciation expense for tractors and trailers and non-driver salaries, wages and benefits. The TTS segment requires substantial cash expenditures for tractor and trailer purchases. We fund these purchases with net cash from operations and financing available under our existing credit facilities, as management deems necessary.
We provide non-trucking services primarily through the three divisions within our Werner Logistics segment (Truckload Logistics, Intermodal, and Final Mile). Unlike our TTS segment, the Werner Logistics segment is less asset-intensive and is instead dependent upon qualified associates, information systems and qualified third-party capacity providers. The largest expense item related to the Werner Logistics segment is the cost of purchased transportation we pay to third-party capacity providers. This expense item is recorded as rent and purchased transportation expense. Other operating expenses consist primarily of salaries, wages and benefits, as well as depreciation and amortization, supplies and maintenance, and other general expenses. We evaluate the Werner Logistics segment’s financial performance by reviewing operating expenses and operating income expressed as a percentage of revenues. Purchased transportation expenses as a percentage of revenues can be impacted by the rates charged to customers and the costs of securing third-party capacity. We have a mix of contracted long-term rates and variable rates for the cost of third-party capacity, and we cannot assure that our operating results will not be adversely impacted in the future if our ability to obtain qualified third-party capacity providers changes or the rates of such providers increase.
Results of Operations:
The following table sets forth the consolidated statements of income in dollars and as a percentage of total operating revenues and the percentage increase or decrease in the dollar amounts of those items compared to the prior year.
| Three Months Ended (3ME) September 30, | Nine Months Ended (9ME) September 30, | Percentage Change in Dollar Amounts | |||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | 3ME | 9ME | ||||||||||||||||||||||||||||||||||||
| (in thousands) | $ | % | $ | % | $ | % | $ | % | % | % | |||||||||||||||||||||||||||||||
| Operating revenues | $ | 771,499 | 100.0 | $ | 745,701 | 100.0 | $ | 2,236,761 | 100.0 | $ | 2,275,579 | 100.0 | 3.5 | (1.7) | |||||||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||||||||||||
| Salaries, wages and benefits | 268,720 | 34.8 | 258,335 | 34.6 | 762,396 | 34.1 | 783,492 | 34.4 | 4.0 | (2.7) | |||||||||||||||||||||||||||||||
| Fuel | 64,059 | 8.3 | 64,886 | 8.7 | 187,552 | 8.4 | 214,506 | 9.4 | (1.3) | (12.6) | |||||||||||||||||||||||||||||||
| Supplies and maintenance | 65,496 | 8.5 | 61,548 | 8.2 | 187,796 | 8.4 | 185,311 | 8.2 | 6.4 | 1.3 | |||||||||||||||||||||||||||||||
| Taxes and licenses | 23,189 | 3.0 | 23,565 | 3.2 | 68,633 | 3.1 | 74,223 | 3.3 | (1.6) | (7.5) | |||||||||||||||||||||||||||||||
| Insurance and claims | 38,060 | 4.9 | 27,678 | 3.7 | 75,024 | 3.4 | 95,937 | 4.2 | 37.5 | (21.8) | |||||||||||||||||||||||||||||||
| Depreciation and amortization | 72,184 | 9.4 | 71,584 | 9.6 | 212,990 | 9.5 | 218,526 | 9.6 | 0.8 | (2.5) | |||||||||||||||||||||||||||||||
| Rent and purchased transportation | 243,115 | 31.5 | 211,667 | 28.4 | 677,537 | 30.3 | 626,009 | 27.5 | 14.9 | 8.2 | |||||||||||||||||||||||||||||||
| Communications and utilities | 3,967 | 0.5 | 4,186 | 0.6 | 12,054 | 0.5 | 13,019 | 0.6 | (5.2) | (7.4) | |||||||||||||||||||||||||||||||
| Other | 5,730 | 0.8 | 4,657 | 0.6 | 5,311 | 0.2 | 11,762 | 0.5 | 23.0 | (54.8) | |||||||||||||||||||||||||||||||
| Total operating expenses | 784,520 | 101.7 | 728,106 | 97.6 | 2,189,293 | 97.9 | 2,222,785 | 97.7 | 7.7 | (1.5) | |||||||||||||||||||||||||||||||
| Operating income (loss) | (13,021) | (1.7) | 17,595 | 2.4 | 47,468 | 2.1 | 52,794 | 2.3 | (174.0) | (10.1) | |||||||||||||||||||||||||||||||
| Total other expense, net | 8,884 | 1.1 | 9,051 | 1.2 | 23,671 | 1.0 | 22,804 | 1.0 | (1.8) | 3.8 | |||||||||||||||||||||||||||||||
| Income (loss) before income taxes | (21,905) | (2.8) | 8,544 | 1.2 | 23,797 | 1.1 | 29,990 | 1.3 | (356.4) | (20.7) | |||||||||||||||||||||||||||||||
| Income tax expense (benefit) | (822) | (0.1) | 2,004 | 0.3 | 11,479 | 0.5 | 8,002 | 0.3 | (141.0) | 43.5 | |||||||||||||||||||||||||||||||
| Net income (loss) | (21,083) | (2.7) | 6,540 | 0.9 | 12,318 | 0.6 | 21,988 | 1.0 | (422.4) | (44.0) | |||||||||||||||||||||||||||||||
| Net loss attributable to noncontrolling interest | 508 | — | 25 | — | 1,071 | — | 354 | — | 1,932.0 | 202.5 | |||||||||||||||||||||||||||||||
| Net income (loss) attributable to Werner | $ | (20,575) | (2.7) | $ | 6,565 | 0.9 | $ | 13,389 | 0.6 | $ | 22,342 | 1.0 | (413.4) | (40.1) | |||||||||||||||||||||||||||
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The following tables set forth the operating revenues, operating expenses and operating income (loss) for the TTS segment and certain statistical data regarding our TTS segment operations, as well as statistical data for One-Way Truckload and Dedicated operations within TTS.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||||||||||||||||||||||||
| TTS segment (in thousands) | $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||||||||||||
| Trucking revenues, net of fuel surcharge | $ | 451,960 | $ | 449,864 | $ | 1,335,936 | $ | 1,377,883 | |||||||||||||||||||||||||||||||||||||||
| Trucking fuel surcharge revenues | 59,456 | 62,749 | 172,297 | 205,698 | |||||||||||||||||||||||||||||||||||||||||||
| Non-trucking and other operating revenues | 8,370 | 10,190 | 31,075 | 27,417 | |||||||||||||||||||||||||||||||||||||||||||
| Operating revenues | 519,786 | 100.0 | 522,803 | 100.0 | 1,539,308 | 100.0 | 1,610,998 | 100.0 | |||||||||||||||||||||||||||||||||||||||
| Operating expenses | 533,618 | 102.7 | 501,196 | 95.9 | 1,489,967 | 96.8 | 1,547,553 | 96.1 | |||||||||||||||||||||||||||||||||||||||
| Operating income (loss) | $ | (13,832) | (2.7) | $ | 21,607 | 4.1 | $ | 49,341 | 3.2 | $ | 63,445 | 3.9 | |||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| TTS segment | 2025 | 2024 | % Change | 2025 | 2024 | % Change | |||||||||||||||||||||||||||||
| Average tractors in service | 7,503 | 7,414 | 1.2 | % | 7,469 | 7,660 | (2.5) | % | |||||||||||||||||||||||||||
Average revenues per tractor per week (1) | $ | 4,633 | $ | 4,667 | (0.7) | % | $ | 4,585 | $ | 4,612 | (0.6) | % | |||||||||||||||||||||||
| Total tractors (at quarter end) | |||||||||||||||||||||||||||||||||||
| Company | 7,120 | 7,155 | (0.5) | % | 7,120 | 7,155 | (0.5) | % | |||||||||||||||||||||||||||
| Independent contractor | 325 | 290 | 12.1 | % | 325 | 290 | 12.1 | % | |||||||||||||||||||||||||||
| Total tractors | 7,445 | 7,445 | — | % | 7,445 | 7,445 | — | % | |||||||||||||||||||||||||||
| Total trailers (at quarter end) | 24,625 | 25,860 | (4.8) | % | 24,625 | 25,860 | (4.8) | % | |||||||||||||||||||||||||||
One-Way Truckload | |||||||||||||||||||||||||||||||||||
| Trucking revenues, net of fuel surcharge (in 000’s) | $ | 159,501 | $ | 164,577 | (3.1) | % | $ | 478,005 | $ | 502,697 | (4.9) | % | |||||||||||||||||||||||
| Average tractors in service | 2,638 | 2,605 | 1.3 | % | 2,635 | 2,707 | (2.7) | % | |||||||||||||||||||||||||||
| Total tractors (at quarter end) | 2,480 | 2,540 | (2.4) | % | 2,480 | 2,540 | (2.4) | % | |||||||||||||||||||||||||||
| Average percentage of empty miles | 15.65 | % | 15.33 | % | 2.1 | % | 15.72 | % | 14.98 | % | 4.9 | % | |||||||||||||||||||||||
Average revenues per tractor per week (1) | $ | 4,649 | $ | 4,860 | (4.3) | % | $ | 4,650 | $ | 4,763 | (2.4) | % | |||||||||||||||||||||||
Average % change in revenues per total mile (1) | 0.4 | % | 0.3 | % | 1.2 | % | (1.2) | % | |||||||||||||||||||||||||||
| Average % change in total miles per tractor per week | (4.7) | % | 6.6 | % | (3.5) | % | 5.9 | % | |||||||||||||||||||||||||||
| Average completed trip length in miles (loaded) | 558 | 578 | (3.5) | % | 572 | 586 | (2.4) | % | |||||||||||||||||||||||||||
Dedicated | |||||||||||||||||||||||||||||||||||
| Trucking revenues, net of fuel surcharge (in 000’s) | $ | 292,459 | $ | 285,287 | 2.5 | % | $ | 857,931 | $ | 875,186 | (2.0) | % | |||||||||||||||||||||||
| Average tractors in service | 4,865 | 4,809 | 1.2 | % | 4,834 | 4,953 | (2.4) | % | |||||||||||||||||||||||||||
| Total tractors (at quarter end) | 4,965 | 4,905 | 1.2 | % | 4,965 | 4,905 | 1.2 | % | |||||||||||||||||||||||||||
Average revenues per tractor per week (1) | $ | 4,624 | $ | 4,563 | 1.3 | % | $ | 4,549 | $ | 4,531 | 0.4 | % | |||||||||||||||||||||||
(1)Net of fuel surcharge revenues.
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The following tables set forth the Werner Logistics segment’s revenues, purchased transportation expense, other operating expenses (primarily salaries, wages and benefits expense), total operating expenses, and operating income (loss), as well as certain statistical data regarding the Werner Logistics segment.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||||||||||||||||||||||||
| Werner Logistics segment (in thousands) | $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||||||||||||
| Operating revenues | $ | 232,585 | 100.0 | $ | 206,774 | 100.0 | $ | 649,320 | 100.0 | $ | 618,168 | 100.0 | |||||||||||||||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||||||||||||||||||
| Purchased transportation expense | 199,616 | 85.8 | 176,205 | 85.2 | 555,100 | 85.5 | 525,758 | 85.1 | |||||||||||||||||||||||||||||||||||||||
| Other operating expenses | 29,955 | 12.9 | 30,914 | 15.0 | 87,353 | 13.4 | 94,534 | 15.2 | |||||||||||||||||||||||||||||||||||||||
| Total operating expenses | 229,571 | 98.7 | 207,119 | 100.2 | 642,453 | 98.9 | 620,292 | 100.3 | |||||||||||||||||||||||||||||||||||||||
| Operating income (loss) | $ | 3,014 | 1.3 | $ | (345) | (0.2) | $ | 6,867 | 1.1 | $ | (2,124) | (0.3) | |||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| Werner Logistics segment | 2025 | 2024 | % Change | 2025 | 2024 | % Change | |||||||||||||||||||||||||||||
| Average tractors in service | 23 | 20 | 15.0 | % | 24 | 22 | 9.1 | % | |||||||||||||||||||||||||||
| Total tractors (at quarter end) | 23 | 20 | 15.0 | % | 23 | 20 | 15.0 | % | |||||||||||||||||||||||||||
| Total trailers (at quarter end) | 4,010 | 3,475 | 15.4 | % | 4,010 | 3,475 | 15.4 | % | |||||||||||||||||||||||||||
| Total containers (at quarter end) | 375 | 200 | 87.5 | % | 375 | 200 | 87.5 | % | |||||||||||||||||||||||||||
Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024
Operating Revenues and Operating Profitability
Operating revenues increased 3.5% for the three months ended September 30, 2025, compared to the same period of the prior year. When comparing third quarter 2025 to third quarter 2024, TTS segment revenues decreased $3.0 million, or 0.6%, and Werner Logistics revenues increased $25.8 million, or 12.5%. We had an operating loss of $13.0 million in third quarter 2025 compared to $17.6 million operating income in third quarter 2024, and our operating margin percentage decreased to (1.7)% in third quarter 2025 from 2.4% in third quarter 2024. TTS segment had an operating loss of $13.8 million in third quarter 2025 compared to $21.6 million operating income in third quarter 2024, and its operating margin percentage decreased to (2.7)% in third quarter 2025 from 4.1% in third quarter 2024. Our third quarter 2025 consolidated and TTS segment operating results were negatively impacted by an $18.0 million litigation settlement agreement and $3.4 million of related legal fees. In October 2025, we reached an agreement with the plaintiffs in the consolidated class action lawsuits entitled Abarca et al. v. Werner that are pending in the United States District Court for the District of Nebraska, to settle these cases for a combined $18.0 million. An accrual for this settlement was recorded as of September 30, 2025. The settlement is subject to court approval (see Note 9 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for information regarding legal proceedings). Werner Logistics had operating income $3.0 million in third quarter 2025 compared to an operating loss of $0.3 million in third quarter 2024, and its operating margin percentage increased to 1.3% in third quarter 2025 from (0.2)% in third quarter 2024. The increase in Werner Logistics operating margin was pressured during third quarter 2025, as the conclusion of higher margin project work was replaced with contractual business.
Dedicated retention and pipeline remains strong, as we are continuing to see steady momentum in adding new business. Overall demand was below normal seasonality for most of the third quarter 2025, however we did see improvement in One-Way Truckload demand through September and October 2025. The 2025 peak season shipments are projected to be lower while 2025 peak revenue per shipment is expected to be flat compared to 2024. Spot freight rates, which have trended positively recently in late September and into October 2025, continue an upward trend which is consistent with normal seasonality. Industry capacity has continued to contract following recent regulatory and enforcement actions related to non-domiciled commercial driver's licenses (“CDLs”), B1 Visas, and English Language Proficiency standards. As challenging operating conditions continue, we are also seeing an increase in bankruptcies in the trucking industry further limiting capacity.
Trucking revenues, net of fuel surcharge, increased 0.5% in third quarter 2025 compared to third quarter 2024 due to a 1.2% increase in the average number of tractors in service. TTS average revenues per tractor per week, net of fuel surcharge, decreased 0.7%, due primarily to a 4.7% decrease in One-Way Truckload average total miles per tractor per week, partially offset by a 0.4% increase in One-Way Truckload revenues per total mile, net of fuel surcharge. One-Way Truckload average tractors in service increased 1.3%. We expect One-Way Truckload fleet average revenues per total mile, net of fuel surcharge, to decrease 1% or increase up to 1% in fourth quarter 2025 compared to fourth quarter 2024. Although One-Way Truckload average total miles per tractor per week decreased in third quarter 2025, we believe this decrease is temporary as One-Way
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Truckload production has been recovering throughout October 2025. Despite inefficiencies from new Dedicated fleet startups during third quarter 2025, Dedicated average revenues per tractor per week, net of fuel surcharge, increased 1.3%. We have observed that it often takes 90 days or more before new fleets meet targeted levels. We expect Dedicated average revenues per tractor per week, net of fuel surcharge, will remain flat or increase up to 1.5% in 2025 compared to 2024.
The average number of tractors in service in the TTS segment increased 1.2% to 7,503 in third quarter 2025 from 7,414 in third quarter 2024. We ended third quarter 2025 and 2024 with 7,445 tractors in the TTS segment, flat year-over-year, and a sequential decrease of 100 tractors compared to the end of the second quarter 2025. Within TTS, Dedicated ended third quarter 2025 with 4,965 tractors (or 67% of our total TTS segment fleet) compared to 4,905 tractors (or 66%) a year ago. We are lowering our expectation for our TTS segment fleet size at the end of 2025 to decrease 2% or remain flat when compared to the fleet size at the end of 2024. Implementations of new fleets in Dedicated remain ongoing, and over the remainder of 2025, One-Way Truckload fleet is expected to further decline. We cannot predict whether future driver shortages, if any, would have a further adverse effect on our fleet size. If such a driver market shortage were to occur, it could result in further fleet size reductions, and our results of operations could be adversely affected.
Trucking fuel surcharge revenues decreased 5.2% to $59.5 million in third quarter 2025 from $62.7 million in third quarter 2024 due primarily to the impact of 7.4 million fewer company tractor miles, partially offset by higher average diesel fuel prices in third quarter 2025. These revenues represent collections from customers for the increase in fuel and fuel-related expenses, including the fuel component of our independent contractor cost (recorded as rent and purchased transportation expense) and fuel taxes (recorded in taxes and licenses expense), when diesel fuel prices rise. Conversely, when fuel prices decrease, fuel surcharge revenues decrease. To lessen the effect of fluctuating fuel prices on our margins, we collect fuel surcharge revenues from our customers for the cost of diesel fuel and taxes in excess of specified base fuel price levels according to terms in our customer contracts. Fuel surcharge rates generally adjust weekly based on an independent U.S. Department of Energy fuel price survey which is released every Monday. Our fuel surcharge programs are designed to (i) recoup higher fuel costs from customers when fuel prices rise and (ii) provide customers with the benefit of lower fuel costs when fuel prices decline. These programs generally enable us to recover a majority, but not all, of the fuel price increases. The remaining portion is generally not recoverable because it results from empty and out-of-route miles (which are not billable to customers) and tractor idle time. Fuel prices that change rapidly in short time periods also impact our recovery because the surcharge rate in most programs only changes once per week.
Werner Logistics revenues are generated by its three divisions. Werner Logistics recorded revenue and brokered freight expense of $0.2 million in third quarter 2025 and $3.2 million in third quarter 2024 for certain shipments performed by the TTS segment (also recorded as trucking revenue by the TTS segment), and these transactions between reporting segments are eliminated in consolidation. In third quarter 2025, Werner Logistics revenues increased $25.8 million, or 12.5%, compared to third quarter 2024. Truckload Logistics revenues (75% of total Werner Logistics segment revenues) increased $19.8 million, or 13%, in third quarter 2025, driven by a 12% increase in shipments. The Power Only solution, which utilizes third-party carriers who provide only a driver and a tractor, represented a growing portion of Truckload Logistics operations in third quarter 2025. Power Only revenues increased 26% while traditional brokerage recorded mid-single digit revenue growth in third quarter 2025 compared to third quarter 2024. Truckload Logistics volume in October has weakened and margins have been pressured as purchased transportation costs have increased. Intermodal revenues (15% of total Werner Logistics segment revenues) increased $6.4 million, or 23%, in third quarter 2025, due to a 22% increase in shipments and relatively stable revenue per shipment. Final Mile revenues (10% of total Werner Logistics segment revenues) decreased $0.3 million, or 1%, in third quarter 2025, but increased 4% sequentially.
Operating Expenses
Our operating ratio (operating expenses expressed as a percentage of operating revenues) was 101.7% in third quarter 2025 compared to 97.6% in third quarter 2024. Expense items that impacted the overall operating ratio are described on the following pages. The tables on pages 25 through 27 show the consolidated statements of income in dollars and as a percentage of total operating revenues and the percentage increase or decrease in the dollar amounts of those items compared to the same period of the prior year, as well as the operating ratios, operating margins, and certain statistical information for our two reportable segments, TTS and Werner Logistics.
Salaries, wages and benefits increased $10.4 million or 4.0% in third quarter 2025 compared to third quarter 2024 and increased 0.2% as a percentage of operating revenues. The higher dollar amount of salaries, wages and benefits expense in the third quarter of 2025 was due primarily to the impact of an $18.0 million litigation settlement agreement discussed above, partially offset by the impact of 7.4 million fewer company tractor miles and decreased non-driver pay. The $18.0 million litigation settlement is included in our TTS segment. The decrease in non-driver pay was due primarily to a smaller average number of non-driver employees. Non-driver salaries, wages and benefits in our non-trucking Werner Logistics segment decreased 10% in third quarter 2025 compared to third quarter 2024.
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We renewed our workers’ compensation insurance coverage on April 1, 2025. Our coverage levels are the same as the prior policy year. We continue to maintain a self-insurance retention of $2.0 million per claim. Our workers’ compensation insurance premiums for the policy year beginning April 2025 are $0.1 million lower than the previous policy year.
While we currently believe the driver recruiting and retention market may be less difficult in the near term, a competitive driver market presents labor challenges for customers and carriers alike. Several factors impacting the driver market include a declining number of, and increased competition for, driver training school graduates, aging truck driver demographics and increased truck safety regulations. We continue to take significant actions to strengthen our driver recruiting and retention as we strive to be the truckload employer of choice, including competitive driver pay, providing a modern tractor and trailer fleet with the latest safety equipment and technology, investing in our driver training school network and offering a wide variety of driving positions including daily and weekly home time opportunities. We are unable to predict whether we will experience future driver shortages or maintain our current driver retention rates. If such a driver shortage were to occur and driver pay rate increases became necessary to attract and retain drivers, our results of operations would be negatively impacted to the extent that we could not obtain corresponding freight rate increases.
Fuel decreased $0.8 million or 1.3% in third quarter 2025 compared to third quarter 2024 and decreased 0.4% as a percentage of operating revenues, due to the impact of 7.4 million fewer company tractor miles, partially offset by higher average diesel fuel prices in third quarter 2025. Average diesel fuel prices were 5 cents per gallon higher in third quarter 2025 than in third quarter 2024 and were 19 cents per gallon higher than in second quarter 2025.
We continue to employ measures to improve our fuel mpg such as (i) limiting tractor engine idle time by installing auxiliary power units, (ii) optimizing the speed, weight and specifications of our equipment and (iii) implementing mpg-enhancing equipment changes to our fleet including new tractors, more aerodynamic tractor features, idle reduction systems, trailer tire inflation systems, trailer skirts and automated manual transmissions to reduce our fuel gallons purchased. However, fuel savings from mpg improvement is partially offset by higher depreciation expense and the additional cost of diesel exhaust fluid. Although our fuel management programs require significant capital investment and research and development, we intend to continue these and other environmentally conscious initiatives, including our active participation as a U.S. Environmental Protection Agency (“EPA”) SmartWay Transport Partner. The SmartWay Transport Partnership is a national voluntary program developed by the EPA and freight industry representatives to reduce greenhouse gases and air pollution and promote cleaner, more efficient ground freight transportation.
For October 2025, the average diesel fuel price per gallon was 5 cents higher than the average diesel fuel price per gallon in October 2024 and 8 cents higher than in fourth quarter 2024.
Shortages of fuel, increases in fuel prices and petroleum product rationing can have a material adverse effect on our operations and profitability. We are unable to predict whether fuel price levels will increase or decrease in the future or the extent to which fuel surcharges will be collected from customers. As of September 30, 2025, we had no derivative financial instruments to reduce our exposure to fuel price fluctuations.
Supplies and maintenance increased $3.9 million or 6.4% in third quarter 2025 compared to third quarter 2024 and increased 0.3% as a percentage of operating revenues. Supplies and maintenance expense increased due primarily to higher costs for tires, tolls, over-the-road trailer maintenance, and driver and placement driver-related costs such as driver advertising and lodging. These increases were partially offset by lower costs for over-the-road tractor maintenance and the impact of 7.4 million fewer company tractor miles in third quarter 2025.
Taxes and licenses decreased $0.4 million or 1.6% in third quarter 2025 compared to third quarter 2024 and decreased 0.2% as a percentage of operating revenues due primarily to lower costs for fuel taxes. The decrease in fuel tax expense in the third quarter of 2025 was impacted by 7.4 million fewer company tractor miles.
Insurance and claims increased $10.4 million or 37.5% in third quarter 2025 compared to third quarter 2024 and increased 1.2% as a percentage of operating revenues. We had higher expense for small dollar liability claims, resulting primarily from higher expense for new claims and a lower amount of favorable reserve development. Our expense for large dollar liability claims was also higher, primarily due to a higher amount of unfavorable reserve development, partially offset by lower expense for new claims. The expense for new claims was impacted by increased cost per claim in third quarter 2025 compared to the same period in 2024. We also incurred insurance and claims expense of $1.5 million for third quarter of the prior year for accrued interest related to the adverse jury verdict rendered on May 17, 2018. We continued to accrue pre-tax insurance and claims expense for interest at $0.5 million per month (excluding months where the plaintiffs requested an extension of time to respond to our petition for review) until our appeal was finalized in second quarter 2025. The majority of our insurance and claims expense results from our claim experience and claim development under our self-insurance program; the remainder results from insurance premiums for claims in excess of our self-insured limits. We believe our elevated insurance and claims expense is a
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reflection of the ongoing unprecedented rise in verdicts and litigation settlements across the industry, particularly for larger carriers.
We renewed our liability insurance policies on August 1, 2025, and are responsible for the first $15.0 million per claim on all claims with an annual $7.5 million aggregate for claims between $15.0 million and $20.0 million. For the policy year that began August 1, 2024, we were responsible for the first $15.0 million per claim on all claims with an annual $7.5 million aggregate for claims between $15.0 million and $20.0 million. We maintain liability insurance coverage with insurance carriers in excess of the $15.0 million per claim. Our liability insurance premiums for the policy year that began August 1, 2025 are slightly higher than premiums for the previous policy year.
Depreciation and amortization expense increased $0.6 million or 0.8% in third quarter 2025 compared to third quarter 2024 and decreased 0.2% as a percentage of operating revenues due primarily to an increase in depreciation of trailers, as we incurred higher costs for recent specialty trailer purchases. The increase was partially offset by a decrease in technology equipment depreciation as we continue to transition to more cloud-based technology solutions.
The average age of our tractor fleet remains low by industry standards and was 2.5 years as of September 30, 2025, and the average age of our trailers was 5.5 years. We are continuing to invest in new tractors and trailers, technology, and our terminal network in 2025 to improve our driver experience, increase operational efficiency and more effectively manage our maintenance, safety and fuel costs.
Rent and purchased transportation expense increased $31.4 million or 14.9% in third quarter 2025 compared to third quarter 2024, and increased 3.1% as a percentage of operating revenues. Rent and purchased transportation expense consists mostly of payments to third-party capacity providers in the Werner Logistics segment and other non-trucking operations, payments to independent contractors in the TTS segment, and cloud-based technology fees. The payments to third-party capacity providers generally vary depending on changes in the volume of services generated by the Werner Logistics segment. Werner Logistics recorded revenue and brokered freight expense of $0.2 million in third quarter 2025 and $3.2 million in third quarter 2024 for certain shipments performed by the TTS segment (also recorded as trucking revenue by the TTS segment), and these transactions between reporting segments are eliminated in consolidation. Werner Logistics purchased transportation expense increased $23.4 million in third quarter 2025 as a result of higher logistics revenues, and increased to 85.8% as a percentage of Werner Logistics revenues in third quarter 2025 from 85.2% in third quarter 2024.
Rent and purchased transportation expense for the TTS segment increased $3.1 million in third quarter 2025 compared to third quarter 2024 due primarily to more independent contractor miles. Independent contractor miles increased 1.9 million miles in third quarter 2025 and as a percentage of total miles were 6.4% in third quarter 2025 compared to 5.1% in third quarter 2024. Because independent contractors supply their own tractors and drivers and are responsible for their operating expenses, the increase in independent contractor miles as a percentage of total miles shifted costs from other expense categories, including (i) salaries, wages and benefits, (ii) fuel, (iii) depreciation, (iv) supplies and maintenance and (v) taxes and licenses to the rent and purchased transportation category.
Challenging operating conditions continue to make independent contractor recruitment and retention difficult. Such conditions include inflationary cost increases that are the responsibility of independent contractors and a shortage of financing available to independent contractors for equipment purchases. Historically, we have been able to add company tractors and recruit additional company drivers to offset any decrease in the number of independent contractors. If a shortage of independent contractors and company drivers were to occur, increases in per-mile settlement rates (for independent contractors) and driver pay rates (for company drivers) may become necessary to attract and retain these drivers. These increased expenses could negatively affect our results of operations to the extent that we would not be able to obtain corresponding freight rate increases.
Other operating expenses increased $1.1 million in third quarter 2025 compared to third quarter 2024 and increased 0.2% as a percentage of operating revenues due primarily to $3.4 million of legal fees related to the Abarca et al. v. Werner litigation discussed above and increased bad debt expense. These increases were partially offset by higher gains on sales of property and equipment (primarily used tractors and trailers) and decreased costs associated with professional services. Gains on sales of property and equipment are reflected as a reduction of other operating expenses and are reported net of sales-related expenses (which include costs to prepare the equipment for sale). Gains on sales of property and equipment were $4.5 million in third quarter 2025 compared to $2.6 million. We sold fewer tractors and trailers in third quarter 2025 compared to third quarter 2024 and realized much higher average gains per tractor and trailer. Recently, used tractor values have been elevated due largely to tariff uncertainties. We expect used equipment values to remain stable in the near term given manufacturing production constraints and the evolving regulatory environment that will be an incentive towards higher quality used assets, including assets with lower miles and remaining warranties. As a result, we are narrowing our full-year guidance range for gains on our used equipment from a range of $12 million and $18 million to a range of $14 million to $16 million in 2025.
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Other Expense (Income)
Other expense, net of other income, decreased $0.2 million in third quarter 2025 compared to third quarter 2024, due primarily to a $0.7 million decrease in net interest expense, partially offset by a $0.5 million decrease in the amount of net earnings recognized from our investments (see Note 6 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for information regarding our investments). Net interest expense decreased primarily due to a decrease in average interest rates, partially offset by an increase in average debt outstanding. During the first quarter 2025, we entered into a LSA, which bears interest at a lower rate than the 2022 Credit Agreement (see Note 7 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for information regarding our credit facilities and interest rate swaps). We continue to expect net interest expense for full-year 2025 to be flat-to-down compared to 2024, as we start to benefit from lower interest rates under the LSA.
Income Tax Expense (Benefit)
We had an income tax benefit of $0.8 million in third quarter 2025 compared to income tax expense of $2.0 million in third quarter 2024. Our effective income tax rate (income taxes expressed as a percentage of income (loss) before income taxes) decreased to 3.8% in third quarter 2025 compared to 23.5% in third quarter 2024 due primarily to the impact of $4.7 million of unfavorable return to provision adjustments related to changes in deferred tax assets and liabilities for certain acquired entities and a subsidiary located in Mexico. We estimate our fourth quarter 2025 effective income tax rate to be approximately 26.0% to 27.0%.
Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024
Operating Revenues and Operating Profitability
Operating revenues decreased 1.7% for the first nine months of 2025, compared to the same period of the prior year. When comparing the first nine months of 2025 to the first nine months of 2024, TTS segment revenues decreased $71.7 million, or 4.5%, and Werner Logistics revenues increased $31.2 million, or 5.0%. In the TTS segment, trucking revenues, net of fuel surcharge, decreased $41.9 million, due primarily to a 2.5% decrease in average tractors in service and a 0.6% decrease in average revenues per tractor per week, net of fuel surcharge. TTS segment fuel surcharge revenues for the first nine months 2025 decreased $33.4 million, or 16.2%, when compared to the same period of the prior year due to the impact of 36.9 million fewer company tractor miles and lower average diesel fuel prices. The increase in Werner Logistics revenues was primarily due to higher volumes in Truckload Logistics. We had operating income of $47.5 million for the first nine months of 2025 compared to $52.8 million for the first nine months of 2024, and our operating margin percentage decreased to 2.1% for the first nine months of 2025 from 2.3% for the first nine months of 2024. TTS segment had operating income of $49.3 million for the first nine months of 2025 compared to $63.4 million for the first nine months of 2024, and its operating margin percentage decreased to 3.2% for the first nine months of 2025 from 3.9% for the first nine months of 2024. Our consolidated and TTS segment operating results for the nine months ended September 30, 2025 were positively impacted by a $45.7 million liability reversal through insurance and claims expense as a result of a favorable decision related to a lawsuit arising from a December 2014 accident, and a net favorable change of $7.9 million to the contingent earnout liability related to the Baylor Trucking, Inc. acquisition. The Baylor Trucking, Inc. contingent consideration arrangement was finalized through negotiations in April 2025. These positive impacts were partially offset by an $18.0 million settlement agreement and $3.4 million of related legal fees related to the Abarca et al. v. Werner litigation as discussed above. For additional information related to legal proceedings and the contingent consideration arrangement, see Notes 9 and 5, respectively, in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report. Werner Logistics had operating income of $6.9 million for the first nine months of 2025 compared to an operating loss of $2.1 million for the first nine months of 2024, and its operating margin percentage increased to 1.1% for the first nine months of 2025 from (0.3)% for the first nine months of 2024.
Operating Expenses
Our operating ratio (operating expenses expressed as a percentage of operating revenues) was 97.9% for the nine months ended September 30, 2025 and 97.7% for the nine months ended September 30, 2024. Expense items that impacted the overall operating ratio are described on the following pages. The tables on pages 25 through 27 show the consolidated statements of income in dollars and as a percentage of total operating revenues and the percentage increase or decrease in the dollar amounts of those items compared to the same period of the prior year, as well as the operating ratios, operating margins, and certain statistical information for our two reportable segments, TTS and Werner Logistics.
Salaries, wages and benefits decreased $21.1 million, or 2.7%, in the first nine months of 2025 compared to the same period in 2024 and decreased 0.3% as a percentage of operating revenues. The lower dollar amount of salaries, wages and benefits expense in the first nine months of 2025 was due primarily to the impact of 36.9 million fewer company tractor miles and decreased non-driver pay, partially offset by the impact of an $18.0 million litigation settlement agreement discussed above. The $18.0 million litigation settlement is included in our TTS segment. The decrease in non-driver pay was due primarily to a smaller average number of non-driver employees, partially offset by severance expense of $1.3 million from cost saving
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initiatives. Non-driver salaries, wages and benefits in our non-trucking Werner Logistics segment decreased 12% in the first nine months of 2025 compared to the same period in 2024.
Fuel decreased $27.0 million, or 12.6%, in the first nine months of 2025 compared to the same period in 2024 and decreased 1.0% as a percentage of operating revenues due to lower average diesel fuel prices and 36.9 million fewer company tractor miles in the first nine months of 2025. Average diesel fuel prices were 18 cents per gallon lower in the first nine months of 2025 than in same period in 2024.
Supplies and maintenance increased $2.5 million, or 1.3%, in the first nine months of 2025 compared to the same period in 2024 and increased 0.2% as a percentage of operating revenues. Supplies and maintenance expense increased due primarily to higher costs for tires and advertising, partially offset by lower costs for over-the-road tractor maintenance and the impact of 36.9 million fewer company tractor miles.
Taxes and licenses decreased $5.6 million or 7.5% in first nine months of 2025 compared to the same period in 2024 and decreased 0.2% as a percentage of operating revenues due primarily to lower costs for fuel taxes. The decrease in fuel tax expense in first nine months of 2025 was impacted by 36.9 million fewer company tractor miles.
Insurance and claims decreased $20.9 million, or 21.8%, in the first nine months of 2025 compared to the same period in 2024 and decreased 0.8% as a percentage of operating revenues due primarily to the impact of a $45.7 million liability reversal through insurance and claims expense as a result of a favorable decision in second quarter 2025 related to an adverse jury verdict rendered on May 17, 2018 for a December 2014 accident, effectively ending the lawsuit in favor of Werner. For additional information related to this lawsuit, see Note 9 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report. The favorable impact of the liability reversal was partially offset by higher expense for liability claims. We had higher expense for large dollar liability claims, resulting primarily from higher amount of unfavorable reserve development, partially offset by lower expense for new claims. Our expense for small dollar liability claims was also higher, primarily due to a lower amount of favorable reserve development and higher expense for new claims. The expense for new claims was impacted by decreased cost per claim in first nine months of 2025 compared to the same period in 2024.
Depreciation and amortization expense decreased $5.5 million, or 2.5%, in the first nine months of 2025 compared to the same period in 2024 and decreased 0.1% as a percentage of operating revenues due primarily to decreases in depreciation of tractors as we had fewer average tractors in service, and technology equipment as we continue to transition to more cloud-based technology solutions. These decreases were partially offset by an increase in depreciation for trailers due to higher costs for recent specialty trailers purchases.
Werner Logistics purchased transportation expense increased $29.3 million in the first nine months of 2025 as a result of higher logistics revenues, and increased 0.4% as a percentage of Werner Logistics revenues to 85.5% in the first nine months of 2025 from 85.1% in the same period in 2024. Rent and purchased transportation expense for the TTS segment increased $15.4 million in the first nine months of 2025 compared to the same period in 2024 due primarily to more independent contractor miles, higher technology-related costs, and additional operational facility costs. Independent contractor miles increased 5.4 million miles in the first nine months of 2025 and as a percentage of total miles were 9.0% in the first nine months of 2025 compared to 4.7% in the first nine months of 2024. These increases were partially offset by lower reimbursements to independent contractors because of lower average diesel fuel prices in first nine months of 2025.
Other operating expenses decreased $6.5 million in the first nine months of 2025 compared to the same period in 2024 and decreased 0.3% as a percentage of operating revenues due primarily to the impact of a $7.8 million net favorable change to the contingent earnout liability related to the Baylor Trucking, Inc. acquisition and higher gains on sales of property and equipment (primarily used tractors and trailers), partially offset by legal fees related to the Abarca et al. v. Werner litigation discussed above and increased bad debt expense. Gains on sales of property and equipment were $13.3 million in the first nine months of 2025 compared to $8.8 million, including $1.8 million from the sale of real estate, in the same period in 2024. We sold fewer tractors and trailers in the first nine months of 2025 compared to the same period in 2024 and realized much higher average gains per tractor and trailer, as used equipment values have been elevated due largely to global trade policy.
Other Expense (Income)
Other expense, net of income, increased $0.9 million in the first nine months of 2025 compared to the same period in 2024 due primarily to a $1.7 million increase in net interest expense, partially offset by a $0.8 million increase in the amount of net earnings recognized from our investments (see Note 6 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for information regarding our investments). Net interest expense increased primarily due to the impact of replacing lower-cost debt and interest rate swaps with higher-cost debt and interest rate swaps upon certain maturities in the second quarter of 2024 (see Note 7 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for further information on our debt and interest rate swaps) and an increase in average debt outstanding.
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Income Tax Expense
Income tax expense increased $3.5 million in the first nine months of 2025 compared to the same period in 2024, due primarily to an increase in the effective income tax rate. Our effective income tax rate increased to 48.2% in the first nine months of 2025 compared to 26.7% in the first nine months of 2024 due primarily to the impact of $4.7 million of unfavorable return to provision adjustments related to changes in deferred tax assets and liabilities for certain acquired entities and a subsidiary located in Mexico.
Liquidity and Capital Resources:
We closely manage our liquidity and capital resources. Our liquidity requirements depend on key variables, including the level of investment needed to support business strategies, the performance of the business, capital expenditures, borrowing arrangements, and working capital management. Capital expenditures, business acquisitions, stock repurchases, and dividend payments are components of our cash flow and capital management strategy, which to a large extent, can be adjusted in response to economic and other changes in the business environment. Management’s approach to capital allocation focuses on investing in key priorities that support our business and growth strategies and providing stockholder returns, while funding ongoing operations.
Management believes our financial position at September 30, 2025 is strong. As of September 30, 2025, we had $51.0 million of cash and cash equivalents and $1.4 billion of stockholders’ equity. Cash is invested primarily in short-term money market funds. In addition, we have a maximum borrowing capacity of $1.375 billion under our credit facilities, for which our total available borrowing capacity was $644.1 million as of September 30, 2025 (see Note 7 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for information regarding our credit facilities). We believe the six commercial banks in our $1.075 billion syndicated credit facility all have strong tier-one capital ratios and good loan-to-deposit ratios. We believe our liquid assets, cash generated from operating activities, and borrowing capacity under our existing credit facilities will provide sufficient funds to meet our cash requirements and our planned stockholder returns for the foreseeable future.
Item 7 of Part II of our 2024 Form 10-K includes our disclosure of material cash requirements as of December 31, 2024. There were no material changes in the nature of these items during the nine months ended September 30, 2025.
Cash Flows
During the nine months ended September 30, 2025, we generated cash flow from operations of $119.5 million, a 53.8% or $139.2 million decrease in cash flows compared to the same nine-month period a year ago. The decrease in net cash provided by operating activities was due primarily to working capital changes and a decrease in net income for the nine-month period ended September 30, 2025. We were able to make net capital expenditures, make strategic investments, pay dividends, and repurchase company stock with the net cash provided by operating activities, supplemented by borrowings under our existing credit facilities.
Net investing activities used $99.8 million for the nine-month period ended September 30, 2025, and $206.5 million during the same period in 2024. Net property and equipment additions (primarily revenue equipment) were $93.3 million for the nine-month period ended September 30, 2025, compared to $206.1 million during the same period of 2024. We currently estimate net capital expenditures (primarily revenue equipment) in 2025 to be in the range of $155 million to $175 million, compared to net capital expenditures in 2024 of $234.9 million. Given our strong balance sheet and proactive fleet management, we entered 2025 with a higher-than-normal inventory of new tractors ready to support growth. These factors, combined with a deliberate shift to a more asset light operational mix are expected to result in net capital expenditures below our historical range in 2025. We intend to fund these net capital expenditures through cash flows from operations and financing available under our existing credit facilities, if necessary. As of September 30, 2025, we were committed to property and equipment purchases of approximately $82.1 million.
Net financing activities used $10.9 million during the nine months ended September 30, 2025 compared to $56.4 million during the same period in 2024. We had net borrowings on our debt of $75.0 million during the nine months ended September 30, 2025, increasing our outstanding debt to $725.0 million at September 30, 2025. We had net borrowings on our debt of $41.3 million during the nine months ended September 30, 2024. We paid dividends of $25.7 million during the nine months ended September 30, 2025 and $26.4 million during the same period in 2024. We currently plan to continue paying a quarterly dividend.
Financing activities for the nine months ended September 30, 2025, also included stock repurchases of 2,113,007 shares at a cost of $55.6 million, including broker commissions and excise taxes. Financing activities for the same period in 2024 included common stock repurchases of 1,787,810 shares at a cost of $67.1 million, including broker commissions and excise taxes. On August 7, 2025, the Board of Directors approved a new stock repurchase program under which the Company is authorized to
33
repurchase up to 5,000,000 shares of its common stock. Upon approval of the new program, the Board of Directors withdrew the previous stock repurchase authorization, which had 1,783,342 shares remaining available for repurchase. As of September 30, 2025, the Company had not purchased any shares pursuant to the new authorization and had 5,000,000 shares remaining available for repurchase. The Company has repurchased, and may continue to repurchase, shares of the Company’s common stock. The timing and amount of such purchases depend upon economic and stock market conditions and other factors.
Regulations:
Item 1 of Part I of our 2024 Form 10-K includes a discussion of pending proposed and recently enacted federal, state, and local regulations that could have an impact on our operations. The following is an update to the regulations set forth in our 2024 Form 10-K.
In January 2025, California voluntarily withdrew the Advanced Clean Fleets (“ACF”) waiver request from the U.S. Environmental Protection Agency. Also, in June 2025, Congress rescinded the previously granted waivers for Advanced Clean Trucks (“ACT”). In September 2025, the California Air Resources Board, voted to repeal the ACF regulations from the California Administrative Code. Werner continues to monitor any California Air Resources Board-related regulatory developments. The rescission of the waiver request, approved waivers, and state regulations will potentially impact tractor prices, availability, performance, and efficiency.
In September 2025, the U.S. Department of Transportation enacted an emergency rule to strengthen federal oversight of how states issue non-domiciled commercial learner’s permits (“CLPs”) and CDLs. The rule comes in response to a nationwide review conducted by the Federal Motor Carrier Safety Administration revealing widespread non-compliance among state driver licensing agencies. The rule tightens eligibility for non-domiciled CLPs and CDLs, strengthens safeguards, and makes clear when these licenses must be canceled or revoked.
There have been no other material changes in the status of the proposed regulations previously disclosed in the 2024 Form 10-K.
Critical Accounting Estimates:
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the (i) reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and (ii) reported amounts of revenues and expenses during the reporting period. We evaluate these estimates on an ongoing basis as events and circumstances change, utilizing historical experience, consultation with experts and other methods considered reasonable in the particular circumstances. Actual results could differ from those estimates and may significantly impact our results of operations from period to period. It is also possible that materially different amounts would be reported if we used different estimates or assumptions.
Information regarding our Critical Accounting Estimates can be found in our 2024 Form 10-K. Estimates of accrued liabilities for insurance and claims for bodily injury and property damage is a critical accounting estimate that requires us to make significant judgments and estimates and affects our financial statements.
There have been no material changes to this critical accounting estimate from that discussed in our 2024 Form 10-K.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are exposed to market risk from changes in commodity prices, foreign currency exchange rates, and interest rates.
Commodity Price Risk
The price and availability of diesel fuel are subject to fluctuations attributed to changes in the level of global oil production, refining capacity, regulatory changes, seasonality, weather and other market factors. Historically, we have recovered a majority, but not all, of fuel price increases from customers in the form of fuel surcharges. We implemented customer fuel surcharge programs with most of our customers to offset much of the higher fuel cost per gallon. However, we do not recover all of the fuel cost increase through these surcharge programs. As of September 30, 2025, we had no derivative financial instruments to reduce our exposure to fuel price fluctuations.
Foreign Currency Exchange Rate Risk
We conduct business in foreign countries, primarily in Mexico. To date, most foreign revenues are denominated in U.S. Dollars, and we receive payment for foreign freight services primarily in U.S. Dollars to reduce direct foreign currency risk. Assets and liabilities maintained by a foreign subsidiary company in the local currency are subject to foreign exchange gains or losses. Foreign currency translation gains and losses primarily relate to changes in the value of revenue equipment owned by a
34
subsidiary in Mexico, whose functional currency is the Peso. Foreign currency translation gains were $0.9 million for third quarter 2025 and losses were $2.4 million for third quarter 2024. These gains and losses were recorded in accumulated other comprehensive loss within stockholders’ equity on the consolidated condensed balance sheets.
Interest Rate Risk
We manage interest rate exposure through a mix of variable interest rate debt and interest rate swap agreements. We had $375.0 million of variable interest rate debt outstanding at September 30, 2025, for which the interest rate is effectively fixed at 5.78% with interest rate swap agreements to reduce our exposure to interest rate increases. In addition, we had $350.0 million of variable interest rate debt outstanding at September 30, 2025. Interest on our credit facilities is based on variable rates, including the Secured Overnight Financing Rate (“SOFR”) and commercial paper rate. See Note 7 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report for further detail of our debt and interest rate swaps. Assuming this level of borrowing, a hypothetical one-percentage point increase in the SOFR and commercial paper rate would increase our interest expense by approximately $3.7 million for the next 12-month period.
Item 4. Controls and Procedures.
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”). Our disclosure controls and procedures are designed to provide reasonable assurance of achieving the desired control objectives. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective at a reasonable assurance level in enabling us to record, process, summarize and report information required to be included in our periodic filings with the SEC within the required time period and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Management, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, concluded that no changes in our internal control over financial reporting occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We have confidence in our internal controls and procedures. Nevertheless, our management, including the Chief Executive Officer and Chief Financial Officer, does not expect that the internal controls or disclosure procedures and controls will prevent all errors or intentional fraud. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of such internal controls are met. Further, the design of an internal control system must reflect that resource constraints exist, and the benefits of controls must be evaluated relative to their costs. Because of the inherent limitations in all internal control systems, no evaluation of controls can provide absolute assurance that all control issues, misstatements and instances of fraud, if any, have been prevented or detected.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
For information regarding legal proceedings, see Note 9 in the Notes to Consolidated Financial Statements (Unaudited) set forth in Part I of this report.
Item 1A. Risk Factors.
In addition to the other information set forth in this report, you should carefully consider the factors discussed under Item 1A (Risk Factors) in our 2024 Form 10-K, which could materially affect our business, financial condition, and future results of operations. The risks described in our 2024 Form 10‑K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and results of operations.
There have been no material changes from the risk factors disclosed in our 2024 Form 10-K.
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities.
On August 7, 2025, the Board of Directors approved a new stock repurchase program under which the Company is authorized to repurchase up to 5,000,000 shares of its common stock. We disclosed this authorization on August 11, 2025 in a Form 8-K.
35
Upon approval of the new program, the Board of Directors withdrew the previous stock repurchase authorization that was approved on May 14 2024, which had 1,783,342 shares remaining available for repurchase. As of September 30, 2025, the Company had not purchased any shares pursuant to the new authorization and had 5,000,000 shares remaining available for repurchase. The Company may purchase shares from time to time depending on market, economic, and other factors. The authorization will continue unless withdrawn by the Board of Directors.
No shares of common stock were repurchased during third quarter 2025 by either the Company or any “affiliated purchaser,” as defined by Rule 10b-18 of the Exchange Act.
Item 5. Other Information
Director and Officer Trading Arrangements
During third quarter 2025, no Company director or officer adopted terminated
36
Item 6. Exhibits.
| Exhibit No. | Exhibit | Incorporated by Reference to: | ||||||||||||
| 101 | The following unaudited financial information from Werner Enterprises’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, formatted in iXBRL (Inline Extensible Business Reporting Language) includes: (i) Consolidated Statements of Income for the three and nine months ended September 30, 2025 and 2024, (ii) Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2025 and 2024, (iii) Consolidated Condensed Balance Sheets as of September 30, 2025 and December 31, 2024, (iv) Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024, (v) Consolidated Statements of Stockholders’ Equity and Temporary Equity - Redeemable Noncontrolling Interest for the three and nine months ended September 30, 2025 and 2024, and (vi) the Notes to Consolidated Financial Statements (Unaudited) as of September 30, 2025. | |||||||||||||
| 104 | The cover page from this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, formatted in Inline XBRL (included as Exhibit 101). | |||||||||||||
37
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| WERNER ENTERPRISES, INC. | |||||||||||
Date: November 7, 2025 | By: | /s/ Christopher D. Wikoff | |||||||||
| Christopher D. Wikoff | |||||||||||
| Executive Vice President, Treasurer and Chief Financial Officer | |||||||||||
Date: November 7, 2025 | By: | /s/ James L. Johnson | |||||||||
| James L. Johnson | |||||||||||
| Executive Vice President and Chief Accounting Officer | |||||||||||
38
Exhibit 10.1
EXECUTION VERSION
AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT
This AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT, dated as of October 7, 2025 (this “Amendment”), is among WERNER RECEIVABLES COMPANY, LLC, as Borrower (in such capacity, the “Borrower”), WERNER ENTERPRISES, INC. (“Werner”), as initial Servicer (in such capacity, the “Servicer”), WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Committed Lender and as a Group Agent, GTA FUNDING LLC, as a Conduit Lender, and THE TORONTO-DOMINION BANK (“TD Bank”), as a Related Committed Lender, as a Group Agent and as Administrative Agent (in such capacity, the “Administrative Agent”).
W I T N E S S E T H :
WHEREAS, the Servicer, the Borrower, the Lenders and Group Agents from time to time party thereto and the Administrative Agent have heretofore entered into that certain Loan and Security Agreement, dated as of March 27, 2025 (as amended, restated, supplemented, assigned or otherwise modified from time to time, the “Agreement”);
WHEREAS, the Borrower, the Servicer, the Lenders, the Group Agents and Administrative Agent are entering into that certain Amended and Restated Fee Letter, dated as of the date hereof (the “Fee Letter”); and
WHEREAS, the parties hereto wish to modify the Agreement upon the terms hereof.
NOW, THEREFORE, in exchange for good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged and confirmed), the parties hereto agree as follows:
A G R E E M E N T:
1.Definitions. Unless otherwise defined or provided herein, capitalized terms used herein (including in the recitals) have the meanings attributed thereto in (or by reference in) the Agreement.
2.Amendment to the Agreement. Effective as of the date hereof, the Agreement is hereby amended to incorporate the changes shown on the marked pages of the Agreement attached hereto as Exhibit A.
3.Conditions to Effectiveness. This Amendment shall be effective as of the date hereof upon satisfaction of the following conditions precedent:
(a)Execution of the Amendment. The Administrative Agent shall have received a counterpart of this Amendment duly executed by each of the other parties hereto.
(b)Execution of the Fee Letter. The Administrative Agent shall have received a counterpart of the Fee Letter duly executed by each of the other parties thereto.
(c)Receipt of the Upfront Fee. The Administrative Agent shall have received evidence that the Upfront Fee (as defined in the Fee Letter) has been received by each Group Agent.
(d)Additional Deliverables. The Administrative Agent shall have received on or before the date hereof such other documents, agreements, certificates, instruments, reports and opinions listed on the closing memorandum attached as Annex A hereto, in each case, in form and substance satisfactory to the Administrative Agent.
4.Certain Representations and Warranties. Each of the Servicer and the Borrower represents and warrants to each Credit Party as follows:
(a)Representations and Warranties. The representations and warranties made by such party in the Agreement and in any other Transaction Document to which it is a party are true and correct in all material respects both before and immediately after giving effect to this Amendment, as though made on and as of the date hereof unless such representations and warranties by their terms refer to an earlier date, in which case they shall be true and correct in all material respects on and as of such earlier date.
(b)Power and Authority; Due Authorization. It (i) has all necessary power, authority and legal right to (A) execute and deliver this Amendment and (B) carry out the terms of and perform its obligations under the Transaction Documents to which it is a party (as amended by this Amendment) and (ii) has duly authorized by all necessary corporate or limited liability company action, as applicable, the execution, delivery and performance of this Amendment.
(c)Binding Obligations. This Amendment constitutes the legal, valid and binding obligations of it, enforceable against it in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar Applicable Laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law.
(d)No Violation. The consummation of the transactions contemplated by this Amendment and the fulfillment of the terms hereof by it will not, (i) conflict with, result in any breach or (without notice or lapse of time or both) a default under, (A) its certificate of formation, limited liability company agreement, articles of incorporation or bylaws, as applicable, or (B) any indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which it is a party or by which it or any of its properties is bound, (ii) result in the creation or imposition of any Adverse Claim upon any of its properties pursuant to the terms of any such indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which it is a party or by which it or any of its properties is bound, other than any Adverse Claim created in connection with the Agreement and the other Transaction Documents or otherwise permitted by the Agreement or the other Transaction Documents, or (iii) violate any Applicable Law applicable to it or any of its properties if such violation of Applicable Law could reasonably be expected to have a Material Adverse Effect.
2
(e)No Defaults. No event has occurred and is continuing and no condition exists or would result from this Amendment or any of the transactions contemplated hereby, that constitutes or would result in an Event of Default or Unmatured Event of Default.
5.Reference to, and Effect on the Agreement and the Transaction Documents.
(a)The Agreement (except as specifically amended herein) shall remain in full force and effect and the Agreement and each of the other Transaction Documents are hereby ratified and confirmed in all respects by each of the parties hereto.
(b)On and after the execution and delivery of this Amendment, each reference in the Agreement to “this Agreement”, “hereof”, “hereunder” or words of like import referring to the Agreement, and each reference in any other Transaction Document to “the Loan and Security Agreement”, “thereunder”, “thereof” or words of like import referring to the Agreement, shall mean and be a reference to the Agreement, as amended by this Amendment.
(c)The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Administrative Agent, the Group Agents or the Lenders under, nor constitute a waiver of any provision of, the Agreement or any other Transaction Document.
(d)To the extent that the consent of any party hereto, in any capacity, is required under the Transaction Documents or any other agreement entered into in connection with the Transaction Documents with respect to any of the amendments set forth herein, such party hereby grants such consent.
6.Transaction Document. This Amendment shall be a Transaction Document under (and as defined in) the Agreement.
7.Costs and Expenses. The Borrower agrees to pay on demand all reasonable and documented out-of-pocket costs and expenses in connection with the preparation, negotiation, execution and delivery of this Amendment, including the reasonable Attorney Costs for the Administrative Agent and the other Credit Parties with respect thereto.
8.Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and assigns.
9.Execution in Counterparts. This Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. Delivery of an executed counterpart hereof by facsimile or other electronic means shall be equally effective as delivery of an originally executed counterpart.
10.GOVERNING LAW. THIS AMENDMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING
3
SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF).
11.CONSENT TO JURISDICTION. (a) EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO (I) WITH RESPECT TO THE BORROWER AND THE SERVICER, THE EXCLUSIVE JURISDICTION, AND (II) WITH RESPECT TO EACH OF THE OTHER PARTIES HERETO, THE NON-EXCLUSIVE JURISDICTION, IN EACH CASE, OF ANY NEW YORK STATE OR FEDERAL COURT SITTING IN NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AMENDMENT, AND EACH PARTY HERETO HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING (I) IF BROUGHT BY THE BORROWER, THE SERVICER OR ANY AFFILIATE THEREOF, SHALL BE HEARD AND DETERMINED, AND (II) IF BROUGHT BY ANY OTHER PARTY TO THIS AMENDMENT, MAY BE HEARD AND DETERMINED, IN EACH CASE, IN SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE BORROWER AND THE SERVICER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING. THE PARTIES HERETO AGREE THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
(b) EACH OF THE BORROWER AND THE SERVICER CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO IT AT ITS ADDRESS SPECIFIED IN THE AGREEMENT. NOTHING IN THIS SECTION 11 SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY OTHER CREDIT PARTY TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
12.Severability. Any provisions of this Amendment which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
13.Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment or be given any substantive effect.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written.
WERNER RECEIVABLES COMPANY, LLC,
as the Borrower
By: /s/ Christopher D. Wikoff
Name: Christopher D. Wikoff
Title: Treasurer
WERNER ENTERPRISES, INC.,
as the Servicer
By: /s/ Christopher D. Wikoff
Name: Christopher D. Wikoff
Title: EVP, Chief Financial Officer & Treasurer
Amendment No. 2 to LSA
(Werner)
THE TORONTO-DOMINION BANK,
as Administrative Agent
By: /s/ Luna Mills
Name: Luna Mills
Title: Managing Director
THE TORONTO-DOMINION BANK,
as Group Agent for the TD Bank Group
By: /s/ Luna Mills
Name: Luna Mills
Title: Managing Director
THE TORONTO-DOMINION BANK,
as Related Committed Lender for GTA Funding
By: /s/ Luna Mills
Name: Luna Mills
Title: Managing Director
GTA FUNDING LLC,
as a Conduit Lender for the TD Bank Group
By: /s/ Kevin J. Corrigan
Name: Kevin J. Corrigan
Title: Vice President
Amendment No. 2 to LSA
(Werner)
S-2
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Group Agent for the Wells Fargo Group
By: /s/ Bria Brown
Name: Bria Brown
Title: Executive Director
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as a Committed Lender
By: /s/ Bria Brown
Name: Bria Brown
Title: Executive Director
Amendment No. 2 to LSA
(Werner)
S-3
EXHIBIT A
Amendments to the Agreement
(Attached)
Amendment No. 2 to LSA
(Werner)
CONFORMED COPY
CONFORMED THROUGHEXHIBIT A TO AMENDMENT NO. 12 TO LOAN AND SECURITY AGREEMENT, DATED JULY 16OCTOBER 7, 2025
LOAN AND SECURITY AGREEMENT
Dated as of March 27, 2025 by and among
WERNER RECEIVABLES COMPANY, LLC,
as Borrower,
THE PERSONS FROM TIME TO TIME PARTY HERETO,
as Lenders and as Group Agents,
THE TORONTO-DOMINION BANK,
as Administrative Agent, and
WERNER ENTERPRISES, INC.,
as initial Servicer
respect of such Person shall be entered in an involuntary case under federal bankruptcy laws or other similar Applicable Laws now or hereafter in effect; or
(b) such Person (i) shall commence a voluntary case or other proceeding under any applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other similar law now or hereafter in effect, (ii) shall consent to the appointment of or taking possession by a receiver, liquidator, examiner, assignee, trustee, custodian, sequestrator (or other similar official) for, such Person or for any substantial part of its property, or (iii) shall make any general assignment for the benefit of creditors, or shall fail to, or admit in writing its inability to, pay its debts generally as they become due, or, if a corporation or similar entity, its board of directors (or any board or Person holding similar rights to control the activities of such Person) shall vote to implement any of the foregoing.
“Event of Default” has the meaning specified in Section 10.01. For the avoidance of doubt, any Event of Default that occurs shall be deemed to be continuing at all times thereafter unless and until waived in accordance with Section 14.01.
“Exchange Act” means the Securities Exchange Act of 1934, as amended or otherwise modified from time to time.
“Excluded Obligor” means each Person listed on Schedule VI hereto.
“Excluded Receivable” means each Receivable (without giving effect to the exclusion of “Excluded Receivable” from the definition thereof), the Obligor of which is an Excluded Obligor.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to an Affected Person or required to be withheld or deducted from a payment to an Affected Person:
(a) Taxes imposed on or measured by net income (however denominated), franchise Taxes and branch profits Taxes, in each case, (i) imposed as a result of such Affected Person being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in the Loans or Commitment pursuant to a law in effect on the date on which (i) such Lender becomes a party to this Agreement (other than pursuant to an assignment requested by the Borrower) or (ii) such Lender changes its lending office, except in each case to the extent that amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office and (c) any U.S. federal withholding Taxes imposed pursuant to FATCA.
“Exiting Group” has the meaning set forth in Section 2.02(g).
“Facility Limit” means $300,000,000325,000,000 as reduced or increased from time to time pursuant to Section 2.02(e) or Section 2.02(h). References to the unused portion of the
18
“Representatives” has the meaning set forth in Section 14.06(c).
“Required Capital Amount” means $17,500,00019,000,000.
“Required Reserve Percentage” means, on any day, the sum of (a) the Yield Reserve Percentage, plus (b) the greater of (i) the sum of (A) the Dynamic Loss Reserve Percentage, plus
(B) the Dilution Reserve Percentage and (ii) the sum of (A) the Loss Reserve Floor Percentage, plus (B) the Dilution Reserve Floor Percentage.
“Required Reserves” means, on any day, an amount determined as follows:
RRP x NPB | ||||||||
where: | ||||||||
| RRP | = | the Required Reserve Percentage on such day; and | ||||||
NPB | = | the Net Pool Balance on such day. | ||||||
“Responsible Officer” means the chief executive officer, president, general counsel, any vice president, the chief financial officer, the controller, the treasurer or the assistant treasurer or other similar officer of the applicable Werner Party or any employee of any Werner Party responsible for the administration of the obligations of any Werner Party under this Agreement or any other Transaction Document.
“S&P” means Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services LLC business, and any successor thereto that is a nationally recognized statistical rating organization.
“Sanctioned Country” means at any time, a country, region or territory which is itself (or whose government is) the subject or target of any Sanctions (including, as of the Closing Date, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic or Luhansk People’s Republic regions of Ukraine, Cuba, Iran, North Korea and Syria).
“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC (including OFAC’s Specially Designated Nationals and Blocked Persons List and OFAC’s Consolidated Non-SDN List), the U.S. Department of State, the United Nations Security Council, the European Union, any European member state, His Majesty’s Treasury, or other relevant sanctions authority, (b) any Person operating, organized or resident in a Sanctioned Country, (c) any Person owned or controlled by, or acting or purporting to act for or on behalf of, directly or indirectly, any such Person or Persons described in clauses (a) and (b), including a Person that is deemed by OFAC to be a Sanctions target based on the ownership of such legal entity by Sanctioned Person(s) or (d) any Person otherwise a target of Sanctions, including vessels and aircraft, that are designated under any Sanctions program.
“Sanctions” means any and all economic or financial sanctions, sectoral sanctions, secondary sanctions, trade embargoes and restrictions and anti-terrorism laws, including but not limited to those imposed, administered or enforced from time to time by the U.S. government
31
SCHEDULE I
Commitments
Party | Capacity | Commitment | ||||||
TD Bank | Committed Lender | $180,000,000195,000,000 | ||||||
Wells Fargo | Committed Lender | $120,000,000130,000,000 | ||||||
Schedule I
ANNEX A
(Attached)
Amendment No. 2 to LSA
(Werner)
Closing Memorandum
AMENDMENT TO LOAN AND SECURITY AGREEMENT
among
WERNER RECEIVABLES COMPANY, LLC,
as Borrower
WERNER ENTERPRISES, INC.,
as Servicer
THE PERSONS FROM TIME TO TIME PARTY THERETO,
as Lenders and Group Agents
and
THE TORONTO-DOMINION BANK,
as Administrative Agent
For October 7, 2025 Closing
| Parties and Abbreviations: | |||||
| Administrative Agent | TD Bank | ||||
| Baird | Baird Holm LLP, Nebraska counsel to the Werner Parties | ||||
| Ballard Spahr | Ballard Spahr LLP, counsel to the Werner Parties | ||||
| Borrower | Werner Receivables Company, LLC, a newly formed Delaware limited liability company structured as a typical bankruptcy- remote special purpose entity with at least one independent director | ||||
| Committed Lenders | TD Bank and Wells Fargo | ||||
| Conduit Lender | GTA Funding | ||||
| Deposit Account Bank | BMO Bank N.A. | ||||
| Group Agents | TD Bank and Wells Fargo | ||||
| GTA Funding | GTA Funding LLC | ||||
| Independent Director | Jessica L.M. Woodward, an employee of Corporation Service Company | ||||
| Lenders | Conduit Lender and Committed Lenders | ||||
| MB | Mayer Brown LLP, counsel to the Administrative Agent | ||||
| Originator | Werner | ||||
| Servicer | Werner | ||||
| TD Bank | The Toronto-Dominion Bank | ||||
| Wells Fargo | Wells Fargo Bank, National Association | ||||
| Werner | Werner Enterprises, Inc., a Nebraska corporation | ||||
| Werner Parties | Borrower, Originator and Servicer | ||||
Document | ||
A. BASIC DOCUMENTS | ||
1. Amendment No. 2 to Loan and Security Agreement (the “LSA”) Exhibit A to Amendment No. 2 to LSA | ||
2. Amended and Restated Fee Letter | ||
B. LEGAL OPINIONS | ||
3. Opinion of counsel to the Werner Parties re: general corporate matters, enforceability, no-conflicts with organizational documents, material agreements, New York, Delaware and Federal law, ’40 Act and Volcker Rule (i.e. the Borrower is not a “covered fund”) and other customary corporate opinions | ||
C. DOCUMENTATION AS TO AUTHORITY, INCUMBENCY AND OTHER MATTERS WITH RESPECT TO SERVICER AND BORROWER | ||
4.Secretary’s Certificate of Werner a.Authorizing Resolutions b.Certificate of Incorporation c.Bylaws d.Incumbency and signatures | ||
5.Secretary’s Certificate of Borrower a.Authorizing Resolutions b.Certificate of Formation c.Limited Liability Company Agreement d.Incumbency and signatures | ||
6. Good Standing Certificate of Werner from its jurisdiction of organization | ||
7. Good Standing Certificate of Borrower from the State of Delaware | ||
D. MISCELLANEOUS | ||
8. Payment of Administrative Agent’s and Lenders’ fees and expenses | ||
EXHIBIT 31.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)
I, Derek J. Leathers, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Werner Enterprises, Inc.; | ||||
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||||
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||||
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||||
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||||
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||||||
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |||||||
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |||||||
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): | ||||
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |||||||
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |||||||
Date: November 7, 2025
| /s/ Derek J. Leathers | ||
| Derek J. Leathers | ||
| Chairman and Chief Executive Officer | ||
EXHIBIT 31.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)
I, Christopher D. Wikoff, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Werner Enterprises, Inc.; | ||||
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||||
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||||
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||||
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||||
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||||||
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |||||||
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |||||||
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): | ||||
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |||||||
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |||||||
Date: November 7, 2025
| /s/ Christopher D. Wikoff | ||
| Christopher D. Wikoff | ||
| Executive Vice President, Treasurer and Chief Financial Officer | ||
EXHIBIT 32.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350
(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)
In connection with the Quarterly Report of Werner Enterprises, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2025 (the “Report”), filed with the Securities and Exchange Commission, I, Derek J. Leathers, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | ||||
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. | ||||
| November 7, 2025 | /s/ Derek J. Leathers | |||||||
| Derek J. Leathers | ||||||||
| Chairman and Chief Executive Officer | ||||||||
EXHIBIT 32.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350
(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)
In connection with the Quarterly Report of Werner Enterprises, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2025 (the “Report”), filed with the Securities and Exchange Commission, I, Christopher D. Wikoff, Executive Vice President, Treasurer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | ||||
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. | ||||
| /s/ Christopher D. Wikoff | ||||||||
| November 7, 2025 | Christopher D. Wikoff | |||||||
| Executive Vice President, Treasurer and Chief Financial Officer | ||||||||