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- **Heavy Haul Strength**: 17% YoY revenue growth in specialized freight, driven by 8% volume and 9% pricing gains.
- **BCO Fleet Expansion**: First sequential truck count increase since 2022, with turnover improving to 31.5%.
- **Noncash Charges**: $30.1M in impairments (Landstar Metro, Blue TMS, tech investment) weighed on GAAP EPS, but adjusted EPS was $1.22.
- **AI Investment**: Rolling out tools to improve agent efficiency, BCO retention, and internal operations.
- **Dividend Discipline**: $111M dividends paid YTD, with $0.40 dividend declared for December.

**【CEO Summary Section】**
- **Challenging Market with Positive Signs**: Despite a 1% year-over-year decline in total revenue, Landstar saw a 17% increase in heavy haul revenue (to $147M) driven by 8% higher volume and 9% better pricing. This reflects strength in specialized freight services.
- **BCO Truck Count Growth**: BCO count increased by 7 trucks sequentially (first growth since Q1 2022), with a 31.5% trailing 12-month turnover rate (down from 34.5%).
- **Non-Recurring Charges**: GAAP EPS of $0.56 included $30.1M in noncash impairments ($16.1M from Landstar Metro sale, $9M from Blue TMS shutdown, $5M from a tech investment write-off). Adjusted EPS was $1.22.
- **AI and Technology Investment**: Rolling out AI tools for agents and BCOs, including a customer service solution and digital tools for load matching and safety.
- **Dividend and Buybacks**: $111M in dividends paid YTD and $143M in share repurchases, with a $0.40 dividend declared for December.

**【CFO Financial Commentary】**
- **Revenue Performance**: Truck revenue per load flat YoY, but heavy haul revenue as a share of unsided/platform rose to 38% (from 34%).
- **Cost Management**: SG&A up 11% to $57M due to IT and compensation, but headcount down 40 since 2025 start. Insurance claims rose 8% to $33M due to higher severity.
- **Balance Sheet Strength**: $434M cash, $152M operating cash flow YTD, and no debt. Free cash flow used for buybacks and dividends.
- **Regulatory Impact**: No BCOs with ELP violations, but potential long-term benefits from tighter trucker regulations.

**【Q&A Highlights】**
- **Truckload Market Trends**: October loads down 3% YoY, revenue per load flat. Seasonal Q3-Q4 trends underperformed (1% load growth vs. typical 1.5%).
- **BCO Retention**: Gross adds up 15% YoY, turnover improving to 31.5%. Growth depends on rate environment.
- **Government Shutdown Impact**: October government-related loads down 30%, but expected to rebound quickly post-shutdown.
- **AI Implementation**: Tools for agents (pricing suggestions), BCO retention analytics, and internal efficiency improvements.
- **2026 Outlook**: Cautious optimism on BCO count growth and margin recovery, but dependent on rate environment and regulatory enforcement.

Landstar System, Inc. (LSTR) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

LSTR

LSTR fundamentals

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