Schneider National’s Earnings Call: Balancing Growth and Challenges

Schneider National ((SNDR)) has held its Q3 earnings call. Read on for the main highlights of the call.

The recent earnings call for Schneider National presented a balanced sentiment, reflecting both positive strategic initiatives and notable financial challenges. The company reported solid volume growth in its Intermodal and Dedicated segments, alongside successful cost savings measures. However, these positives were countered by significant claims-related costs, sub-seasonal market conditions, and a decline in profitability and earnings per share.

Intermodal Volume Growth

The Intermodal segment of Schneider National experienced a remarkable 10% volume growth in the third quarter, significantly outpacing the industry rate. This growth was attributed to strategic actions and market share gains, showcasing the company’s effective operational strategies.

Dedicated Segment Pipeline Success

Schneider’s Dedicated segment achieved substantial success, with wins from both new and existing customers occurring at a rate three times higher than in the first half of the year. The segment continues to maintain a robust pipeline, indicating strong future performance.

Logistics Power Only Resilience

The Logistics segment demonstrated resilience with its Power Only revenues growing for the sixth consecutive quarter. Net revenue per order improved by a high single-digit percentage year-over-year, highlighting the segment’s consistent performance.

Cost Savings Initiatives

Schneider made significant progress towards its $40 million structural cost savings target, including synergies from the Cowan Systems acquisition. These initiatives are crucial for enhancing the company’s financial health amidst challenging market conditions.

Claims-Related Costs Impact

Unexpected claims-related costs amounted to $16 million more than anticipated, significantly impacting Schneider’s third-quarter results. This unforeseen expense underscores the financial challenges the company faces.

Sub-Seasonal Freight Market

The freight market in August and September was largely sub-seasonal, with softer volumes, retreating spot rates, and modest peak activity. These conditions posed challenges for Schneider’s operational performance.

Truckload Segment Profitability

The Truckload segment saw a 16% decline in operating income year-over-year, with a 130 basis point increase in the operating ratio due to claims-related costs and churn. This decline highlights the financial pressures within this segment.

Adjusted Earnings Per Share Decline

Schneider reported a 33% decline in adjusted diluted earnings per share for the third quarter, dropping from $0.18 in 2024 to $0.12 in 2025. This decline reflects the broader financial challenges faced by the company.

Forward-Looking Guidance

In its forward-looking guidance, Schneider National reported enterprise revenues, excluding fuel surcharge, at $1.3 billion, marking a 10% year-over-year increase. Despite a 13% decrease in adjusted income from operations, the company remains committed to strategic initiatives, including a $40 million cost reduction target and a focus on productivity improvements. For the full year 2025, Schneider updated its EPS guidance to approximately $0.70 and revised its net CapEx expectation to around $300 million. The company anticipates potential supply-side catalysts, such as regulatory changes, which could lead to a more favorable market environment in 2026.

In summary, Schneider National’s earnings call reflected a balanced sentiment, with solid growth in key segments and successful cost-saving initiatives. However, significant financial challenges, including unexpected claims-related costs and a sub-seasonal freight market, impacted profitability. The company’s forward-looking guidance remains optimistic, with strategic initiatives aimed at enhancing future performance.