Knight-Swift Q4 2024: Diverging Trends in Truckload and LTL Performance Amid Market Recovery

Truckload Segment Performance:
- Knight-Swift's Truckload revenue, excluding fuel surcharge, decreased 4.4% year-over-year in Q4, with a 170 basis point improvement in adjusted operating ratio.
- The decline in revenue was due to a 3.7% decrease in loaded miles and a slight 0.7% decline in revenue per loaded mile, though revenue per tractor increased 1.7%.
- Improvements in cost-cutting initiatives and operational efficiencies contributed to the improved margin.

LTL Network Expansion:
- The LTL segment saw a 20.2% increase in revenue, excluding fuel surcharge, year-over-year, driven by a 13.3% increase in shipments.
- The segment experienced a 54.9% decline in adjusted operating income due to integration costs and facility expansions.
- The significant network growth and expansion into new territories, particularly the Southwest and California, are strategic investments aimed at building long-term value and market penetration.

Guidance and Market Outlook:
- Knight-Swift's adjusted EPS guidance for Q1 2025 is $0.29 to $0.33, and for Q2 2025, it is $0.46 to $0.50.
- The company anticipates a gradual recovery in market conditions, driven by seasonal improvements, favorable contractual rate trends, and more balanced market conditions.

Intermodal Business Enhancements:
- The Intermodal segment reported a 4.9% increase in revenue year-over-year, supported by a 10.2% increase in load count, despite a 4.8% decrease in revenue per load.
- The improvement was driven by better volume progress, operational cost reductions, and strategic customer diversification.
- The expectation is for market share gains and profitability improvements in 2025 by enhancing network balance and asset efficiency.