0001193125-26-054689
SEC filingTFI International's 2025 revenue and operating income declined due to a weakened freight market, though free cash flow improved on lower capital expenditures.
For the fiscal year ended December 31, 2025, TFI International reported total revenue of $7.88 billion, a decrease of 6.1% compared to $8.40 billion in 2024. The decline was primarily attributable to a weakened market resulting in lower volumes across all segments, partially offset by contributions from business acquisitions of $346.1 million. Operating income fell to $565.3 million from $719.0 million in the prior year, a decline of 21.4%, driven by the revenue decrease and partially offset by $19.7 million in restructuring expenses related to the Daseke acquisition in the second quarter of 2024. Net income was $310.6 million, or $3.72 per diluted share, compared to $422.5 million, or $4.96 per diluted share, in 2024. Adjusted net income, a non-IFRS measure, was $364.9 million, or $4.37 per diluted share, versus $489.5 million, or $5.75 per diluted share, in the prior year.
As of December 31, 2025, total assets were $7.51 billion, up from $7.17 billion at the end of 2024. Total liabilities increased to $4.83 billion from $4.49 billion, primarily due to higher long-term debt and lease liabilities. Shareholders' equity remained relatively flat at $2.68 billion compared to $2.67 billion. The company's debt-to-equity ratio was 0.96, up from 0.90 in the prior year. The company had $210.2 million in cash and cash equivalents at year-end, compared to zero at the end of 2024. The company maintained compliance with its financial covenants, with a funded debt-to-EBITDA ratio of 2.49 (covenant requirement < 3.50) and an EBITDAR coverage ratio of 3.83 (covenant requirement > 1.75).
Net cash from operating activities was $977.8 million in 2025, compared to $1.06 billion in 2024. The decrease was primarily due to lower net income and higher benefit payments, partially offset by an increase in non-cash operating working capital. Free cash flow, a non-IFRS measure, increased to $832.3 million from $768.6 million in 2024, as lower capital expenditures ($273.2 million vs. $392.8 million) and higher proceeds from asset sales more than offset the decline in operating cash flow. The company used $225.8 million for share repurchases and paid $151.1 million in dividends. Net debt increased by $175.1 million, primarily to fund business acquisitions.
Management attributed the revenue decline to a weakened market and lower volumes, noting that the North American economic growth forecast has slightly improved despite higher tariffs and ongoing concerns over inflation and interest rate uncertainty. The company's diversification across industrial and consumer end markets and multiple modes of transportation, along with a sharp focus on quality of revenue and enhanced operational efficiencies, served as mitigating factors. Management believes that as industry supply rationalizes and the freight cycle improves, recent cost structure enhancements and well-timed investments will drive stronger results. The company remains vigilant in monitoring potential emerging risks, including escalating international trade friction that may result in freight volume declines and higher costs. Looking beyond near-term industry challenges, diverse industrial exposure through TFI's specialized TL and LTL segments should help it capitalize on a potential shift toward domestic manufacturing, data center and electric grid related industry growth, as well as bonus depreciation from new U.S. tax rules.
Segment performance varied significantly. The Less-Than-Truckload segment saw revenue decline 11.5% to $2.73 billion, with operating income falling 28.0% to $260.0 million. The Truckload segment revenue increased 7.1% to $2.73 billion, driven by business acquisitions, but operating income decreased 12.8% to $220.1 million. The Logistics segment revenue declined 12.6% to $1.50 billion, with operating income down 28.0% to $131.3 million. The company acquired four businesses during 2025, including Hearn Industrial Services for $304.3 million, which was reported in the Logistics segment. The company repurchased 2.48 million common shares at a weighted average price of $91.00 per share for a total of $225.8 million. The company declared quarterly dividends totaling $1.82 per share, up from $1.65 in 2024. The effective tax rate for 2025 was 23.4%, compared to 24.7% in 2024.