What Schneider National (SNDR) Said on Its Q3 Earnings Call

Key Points

• Schneider’s Q3 results improved sharply: Adjusted operating income rose 66% to $63.8 million, adjusted EPS increased to $0.29, and the operating ratio improved to 95.3%, supported by pricing, productivity and cost controls despite uneven freight demand.
• The company is expanding its intermodal strategy: Norfolk Southern will become the primary rail provider for Schneider’s eastern intermodal network starting January 2027, with the agreement intended to broaden market reach and shift more truckload freight to rail.
• Schneider raised its 2026 outlook: Adjusted EPS guidance increased to $1.00–$1.10, while capital expenditure expectations were reduced to $325 million–$350 million as management cited continued pricing recovery and additional efficiency gains.

Schneider National NYSE: SNDR reported higher third-quarter earnings as pricing gains, productivity improvements and cost-control efforts helped offset uneven freight demand and lower equipment counts in parts of its truckload operation.

Adjusted income from operations rose 66% from a year earlier to $63.8 million, while adjusted diluted earnings per share increased to $0.29 from $0.12. Revenue excluding fuel surcharge increased about 3% to $1.35 billion. The company’s adjusted operating ratio improved 170 basis points year over year to 95.3%.

President and Chief Executive Officer Jim Filter said the company continues to pursue profitable organic growth through its multimodal platform, a lower-cost operating model and returns-focused investment decisions. Schneider remains on track to achieve its $40 million cost-savings target, according to management.

Norfolk Southern Agreement Targets Intermodal Growth

Schneider announced an agreement with Norfolk Southern under which the railroad will become the primary rail provider for Schneider’s eastern intermodal network beginning Jan. 1, 2027. Filter said the arrangement is expected to expand the company’s eastern reach, create opportunities with existing and new customers, and support conversion of truckload freight to intermodal service.

The company plans to use its company-owned containers and chassis, along with its company-operated dray fleet, in the network. Schneider has formed a transition team with Norfolk Southern and said it expects to begin moving some freight to the railroad in November ahead of the formal implementation date.

Filter said a potential combination of Norfolk Southern and Union Pacific could create further opportunities through single-line transcontinental rail service and new intermodal lanes, although Schneider is not including those potential benefits in its current expectations.

“This agreement on its own stands, it is economically and strategically beneficial for our organization,” Filter said during the question-and-answer session. He added that Schneider’s experience with single-line service in Mexico following the creation of CPKC reinforced its view of the potential service, speed and reliability benefits from a broader rail network.

Truckload Earnings More Than Double

Truckload revenue excluding fuel surcharge was $625 million, essentially unchanged from the prior-year quarter. Revenue per truck per week increased approximately 8% year over year, offsetting a lower tractor count. Truckload operating income more than doubled to $44 million, and the segment’s operating ratio improved 380 basis points to 93%.

Network revenue per truck per week rose more than 20% year over year, aided by pricing and productivity improvements. Filter said the business benefited from better freight selection, premium freight opportunities and greater asset utilization. Network also produced its first positive quarterly earnings result in more than three years, according to Chief Financial Officer Darrell Campbell.

Dedicated operations were affected by the loss of a large customer, which Schneider had previously anticipated. Filter said the company has sold nearly 850 trucks across its brands year to date as it addresses underperforming accounts, while continuing to pursue opportunities in specialty dedicated services.

Management said driver availability remains a constraint on truck capacity. Schneider is making selective investments in pay, recruiting and AI-enabled tools while tying compensation increases to rate recovery and expected returns.

Intermodal Margins Improve Despite Volume Decline

Intermodal revenue excluding fuel surcharge rose about 2% to $288 million. Volumes declined modestly after nine consecutive quarters of growth, reflecting difficult comparisons, moderating import activity and the company’s focus on profitable freight amid higher third-party dray costs.

Revenue per order increased approximately 3% from a year earlier and nearly 4% sequentially, despite shorter lengths of haul. Intermodal operating income rose 35% to $23 million, while the operating ratio improved 190 basis points to 92.1%.

Filter said intermodal renewal pricing reached its strongest level since the pandemic, though he said rate gains were in the mid-single-digit range and below the increases achieved in truckload network operations. He said Schneider expects the pricing gap between truckload and intermodal to narrow as service levels improve.

Logistics revenue excluding fuel surcharge increased more than 12% to $373 million, but segment operating income was approximately breakeven, compared with $6 million a year earlier. Campbell said results were affected by lower project-based activity and a confidential brokerage-related claim settlement. The company does not view the settlement’s impact as representative of the segment’s ongoing run rate.

A separate favorable settlement resulted in a $7 million reversal of interest accruals, a non-cash item that increased adjusted earnings per share by about $0.03 in the quarter. Campbell said that benefit will not recur in the fourth quarter.

Guidance Raised as Pricing Recovery Continues

Management said freight activity softened modestly from the second quarter, consistent with seasonal patterns after the Fourth of July period. Consumer spending remained resilient overall but varied by category, while housing and automotive end markets continued to face pressure from higher interest rates and affordability concerns.

Filter said supply conditions remain constrained by driver availability, operating costs and higher barriers to entry. The company expects regulatory enforcement related to driver training and electronic logging devices to further limit non-compliant capacity.

Schneider raised its full-year 2026 adjusted diluted earnings-per-share outlook to a range of $1.00 to $1.10. The outlook assumes continued pricing improvement and additional gains from productivity and cost initiatives, while accounting for uncertainty around holiday demand and capacity conditions.

For the full year, Schneider now expects net capital expenditures of $325 million to $350 million, compared with its previous outlook for a higher range. As of Sept. 30, the company had $326 million in cash and cash equivalents, $394 million in debt and finance lease obligations, and net debt leverage of about 0.1 times.

About Schneider National (NYSE:SNDR)

Schneider National, Inc NYSE: SNDR is a transportation and logistics company headquartered in Green Bay, Wisconsin. Founded in 1935 by Al Schneider, the company began as a one-truck operation and has grown into a provider of freight transportation and supply chain services.

Schneider's services include truckload transportation, dedicated transportation, intermodal transportation, brokerage, and logistics management. Its offerings support a range of shipping needs, including long-haul freight, dedicated fleet operations, rail-connected transportation, port drayage, and supply chain planning.

The company primarily serves customers throughout the United States, Canada, and Mexico.

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