KNX · Knight-Swift Transportation Holdings Inc.

Knight-Swift Transportation Holdings Inc. announced a significant downward revision to its first-quarter 2026 Adjusted EPS guidance, now expecting $0.08-$0.10 compared to the previously announced $0.28-$0.32. This revision reflects four specific negative developments affecting both GAAP and non-GAAP results: a $0.08 per share impact from claims development in the less-than-truckload segment primarily related to an unfavorable arbitration award on a 2022 incident; a $0.05 per share impact from deferred project business in the warehousing segment partly due to weather-related disruption; a $0.02 per share impact from an adverse VAT reimbursement decision in Mexico related to prior tax years; and an estimated $0.05-$0.06 per share impact from severe winter weather disruptions in January and sharply rising fuel prices in March. The company simultaneously introduced second-quarter 2026 Adjusted EPS guidance of $0.45-$0.49, which represents a larger than normal sequential increase. Management attributes this expected improvement to the non-recurrence of first-quarter events and improving freight market fundamentals exiting the quarter. CEO Adam Miller commented that while winter weather negatively impacted volumes and operating costs more than typical, it also exposed the reduction in truckload capacity to stakeholders, which is meaningful for ongoing bid activity. Similarly, the rapid increase in fuel costs was a headwind in March but is believed to add to the existing downward trend in truckload industry supply. The company notes the truckload market continues to tighten, the bid environment is rapidly evolving, and its leading presence in the one-way market grows increasingly valuable to shippers. Management expressed increased optimism about earnings opportunities over the next several quarters compared to three months ago, expecting to build momentum as more bids run their course, new pricing and volume awards are realized, cost and operational initiatives continue, and more spot and project opportunities emerge than seen in recent years.