KNX · Knight-Swift Transportation Holdings Inc.

Notes & Operating Detail

Balance Sheet & Liquidity

Total assets stood at $12.6 billion as of September 30, 2025, essentially flat versus year-end 2024. Cash and cash equivalents (including restricted) totaled $294.4 million, down from $365.9 million at December 31, 2024, primarily driven by investing activities. The company had $1.85 billion in total debt (including revolver), up from $1.83 billion at year-end. Net debt (total debt minus total cash) increased to $1.56 billion from $1.46 billion. The current portion of debt and finance leases declined to $204.7 million from $288.4 million. The accounts receivable securitization facility was reclassified from current to non-current, reflecting the extension of the maturity to October 2028 under the new 2025 RSA. Shareholders' equity remained stable at $7.12 billion.

Commitments & Contractual Obligations

The company disclosed $142.2 million in outstanding commitments to purchase revenue equipment for the remainder of 2025 (none thereafter), with $114.0 million specifically for tractors. Additionally, $155.0 million in commitments for facilities and non-revenue equipment were outstanding, with $67.4 million due in 2025, $76.7 million in 2026-2027, and $10.9 million in 2028-2029. There were no disclosed long-term supply or capacity purchase agreements.

Capital Allocation (buybacks, dividends, debt, capex)

No share repurchases occurred during the quarter or year-to-date periods; $200.0 million remained authorized under the 2022 plan. Dividends were increased to $0.18 per share quarterly ($0.72 annualized), up 12.5% from $0.16 in the prior year, totaling $88.3 million year-to-date. Capital expenditures on property and equipment were $641.6 million, representing 11.4% of total revenue. Debt issuance included $1.0 billion from a new term loan A-1 and A-2, while repayments totaled $1.56 billion (including revolver activity), resulting in net debt increase of $185.8 million.

Segment / Geographic Mix (if disclosed at note level)

The company operates four reportable segments: Truckload, LTL, Logistics, and Intermodal, plus All Other Segments. In Q3 2025, LTL revenue jumped 21.2% YoY to $394.5 million, including the DHE acquisition impact, but operating income swung to a loss of $1.7 million (operating ratio 100.4%) from a $24.6 million profit in Q3 2024. Truckload revenue fell 1.7% to $1.24 billion, with operating margin declining to 2.9% (operating ratio 97.1%) from 3.6% a year ago. Logistics revenue declined 2.2%; Intermodal dropped 8.4%; All Other Segments grew 29.9%. Geographic concentration remains domestic (less than 5% international revenue).

Cash Flow Quality

Cash Flow Quality

• CFO vs Net Income: CFO of $543M significantly exceeded net income of $72M, primarily due to large non-cash charges (depreciation $591M, impairments $45M) and a gain on asset sales of $55M. This indicates strong cash generation relative to earnings.
• Capex Intensity: Capital expenditures of $642M outpaced CFO, resulting in negative free cash flow (not computed but implied). The company is investing heavily in equipment, with proceeds from asset sales ($234M) partially offsetting outflows.
• Capital Returns: Dividends paid of $88M represent a payout ratio of 121% of net income, but only 16% of CFO. No share repurchases occurred.
• Working Capital Changes: Cash flow was negatively impacted by a $70M increase in trade receivables and a $86M decrease in accounts payable, reflecting tighter payment terms or lower payables. Income taxes paid spiked to $42M from $10M, a significant use of cash.
• Investing Activities: Besides capex, cash used in acquisitions was nil in 2025 vs. $185M in 2024, a major swing. Proceeds from asset sales increased to $234M.
• Financing Activities: The company raised $1.0B in long-term debt and $907M in revolver borrowings, while repaying $1.56B in debt, resulting in net repayment. This suggests deleveraging or refinancing.