Heartland Express posted another quarterly loss as the prolonged freight recession continued to blunt pricing and utilization, but management highlighted steady month-to-month improvement and said a broad market turn is still more likely next year than in the coming months. The truckload carrier reported third-quarter operating revenue of $196.5 million and a net loss of $8.3 million (11 cents per share), with a reported operating ratio of 103.7% and 103.5% on an adjusted basis. Executives reiterated that freight demand remains below available capacity and that they do not expect “material” market improvement until sometime in 2026.
The quarter underscored a split picture across Heartland’s portfolio. The legacy Heartland fleet and Millis Transfer operated profitably at low-90s operating ratios, and Smith Transport moved back into the black. Contract Freighters Inc. (CFI) improved sequentially but was still unprofitable, even as its fleet completed a telematics transition following a major transportation management system (TMS) conversion earlier in the year. Importantly, all four operating brands are now running on a common TMS—a milestone the company says should reduce unproductive miles and improve driver utilization as integration work continues.
Investors looking for a clean beat didn’t get it. Revenue came in roughly 8% below consensus and EPS matched expectations, reflecting a still-tense spot and bid environment. The miss was concentrated on the top line, which remains pressured by weak volumes and restrained pricing despite some sequential operating improvement within the quarter.
Under the hood, the cost story showed where the pain—and progress—resides. Year over year, salaries, wages and benefits as well as purchased transportation expenses were lower, consistent with a smaller, more selectively deployed fleet. However, insurance and claims rose and depreciation and amortization remained heavy, keeping the consolidated OR above 100 despite better execution. Gains on equipment sales provided some relief versus last year, but not enough to change the headline result.
On the balance sheet, Heartland continues to protect optionality. Cash ended the quarter at $32.7 million and total debt and finance lease obligations were trimmed to $185.4 million—down more than $300 million from levels tied to the 2022 acquisitions. The company generated $74.4 million in operating cash flow through the first nine months of 2025, repurchased $1.4 million of stock in the third quarter, and kept its revolver undrawn. Those moves leave room to keep refreshing the fleet and pursuing selective growth once rates and volumes firm.
For shippers and competing carriers, the read-through is twofold. First, integration matters: putting four brands on one TMS should help Heartland squeeze out empty miles and better match drivers to freight—tactical levers that matter when price is scarce. Second, the company’s message that a meaningful demand/capacity rebalance is a 2026 story cautions anyone expecting a quick Q4 or early-2025 snapback. Until contract bids reset higher and tender volumes consistently outrun seated tractors, even well-capitalized carriers will be playing defense more often than offense.
Shares showed a modest uptick around the release, reflecting incremental progress and a cleaner integration path, but the setup remains a grind: revenue softness and elevated fixed costs continue to cap earnings power near-term. With a leaner network, common systems, and less leverage than a year ago, Heartland’s operating model is positioned to benefit quickly once volumes and rates finally turn—just not on the company’s 2025 calendar.
Sources: FreightWaves, GlobeNewswire (Heartland Express), Seeking Alpha, Zacks, MarketScreener
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