FWRD Filings — Forward Air Corp

FWRD Filings — Forward Air Corp - FilingSpy

10-Q · Quarter ended Jun 30, 2026 · SEC filing ↗

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Original filing text

Management's Discussion and Analysis

Cautionary Statement Regarding Forward-Looking Statements This Quarterly Report on Form 10-Q (our “Quarterly Report”) contains “forward-looking statements,” as defined in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance. Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects,” “expects.” or the negative thereof. However, the absence of these words does not mean that the statements are not forward-looking. These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause or contribute to a material difference include those risks discussed under Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 (our “Annual Report”), as well updates to the risks included in Part II, Item 1A. “Risk Factors” in this Quarterly Report and our other filings with the Securities and Exchange Commission. All forward looking statements set forth in this Quarterly Report are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence to or effects on the Company or its business or operations. Forward-looking statements set forth in this Quarterly Report speak only as of the date hereof, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The following management’s discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in Part I, Item 1 in this Quarterly Report and our audited consolidated financial statements as of December 31, 2025, included in our Annual Report. Overview Forward Air Corporation and its subsidiaries (collectively, the “Company,” “Forward Air,” “we,” “our,” or “us”) is a leading asset-light provider of transportation services. We provide ground transportation, air and ocean forwarding, intermodal drayage services and contract logistics across North and South America, Europe and Asia. We also provide customized asset-light, high-touch logistics and supply chain management solutions with deep customer relationships in high-growth end markets. We offer premium services that typically require precision execution, such as expedited transit, delivery during tight time windows and special handling. We utilize an asset-light strategy to minimize our investments in equipment and facilities and to reduce our capital expenditures. Our services are classified into three reportable segments: Expedited Freight, Omni Logistics and Intermodal. Our Expedited Freight segment provides expedited regional, inter-regional and national Less-Than-Truckload (“LTL”) services. Expedited Freight also offers customers local pick-up and delivery and other services including truckload, shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling. Our Omni Logistics segment provides a full suite of global logistics services. Services include air and ocean freight consolidation and forwarding, customs brokerage, time-definite transportation services, contract logistics, which includes warehousing and value-added services, as well as other supply chain solutions. Our Intermodal segment provides first- and last-mile high value intermodal container drayage services both to and from seaports and railheads. Intermodal also offers dedicated contract and Container Freight Station (“CFS”) warehouse and handling services, and in select locations, linehaul and LTL services. Our operations, particularly our network of hubs and terminals, involve substantial fixed costs. Accordingly, our ability to improve earnings depends in significant part on our ability to increase freight volumes and enhance revenue per pound or per shipment for freight shipped or moved through our network. In addition, our earnings are affected by the growth of other services, such as LTL pickup and delivery, which support revenue growth in a challenging freight environment. We continue to focus on creating synergies across our service offerings, particularly those within our Expedited Freight reportable segment. These synergies include the ability to share resources, especially our fleet. 19 Table of Contents With respect to our Expedited Freight and Intermodal reportable segments, in addition to monitoring our financial results, we monitor and analyze a number of key operating statistics in order to manage these segments and evaluate their operating performance. These key operating statistics are defined below and are referred to throughout the discussion of the financial results of our Expedited Freight and Intermodal reportable segments. Our key operating statistics should not be interpreted as better measurements of our results than operating income as determined under GAAP. As we continue to integrate the legacy Omni business, we measure and manage the performance of the Omni Logistics segment based on its revenue and income. We have not identified, nor do we utilize, any key operating statistics to manage this segment and evaluate the operations of our Omni Logistics reportable segment. Key Operating Statistics Within our Expedited Freight reportable segment, our primary revenue focus is to optimize density, which is to obtain appropriate pricing of our services that allows for profitable shipments and tonnage growth within our existing LTL network. Increases in density allow us to maximize our asset utilization and labor productivity, which we measure over many different functional areas of our operations, including linehaul load factor and door pounds handled per hour. In addition to our focus on density and operating efficiencies, it is critical for us to obtain an appropriate yield, which is measured as revenue per hundredweight, on the shipments we handle to offset our cost inflation and support our ongoing investments in capacity and technology. Revenue per hundredweight is also a commonly used indicator for general pricing trends in the LTL industry and can be influenced by many other factors, such as changes in fuel surcharges, weight per shipment and length of haul. Therefore, changes in revenue per hundredweight may not necessarily indicate actual changes in underlying base rates. We regularly monitor the components of our pricing, including base freight rates, accessorial charges and fuel surcharges. The fuel surcharge is generally designed to offset fluctuations in the cost of the petroleum-based products used in our operations by passing changes in such costs on to customers and is indexed to diesel fuel prices published by the U.S. Department of Energy on a weekly basis. The impact of fuel on our results of operations depends on the relationship between the applicable surcharge, the fuel efficiency of our Company drivers, and the load factor achieved by our operation. Fluctuations in fuel prices in either direction could have a positive or negative impact on our margins, particularly in our LTL business where the weight of a shipment subject to the fuel surcharge on a given trailer can vary materially. We believe our yield management process focused on account level profitability, combined with ongoing improvements in operating efficiencies, are key components of our ability to achieve profitable growth. The key operating statistics necessary to understand the operating results of our Expedited Freight reportable segment are described below in more detail: •Tonnage—Total weight of shipments in pounds. The level of freight tonnage is affected by economic cycles and conditions, customers’ business cycles, changes in customers’ business practices and capacity in the truckload market. •Weight Per Shipment—Total pounds divided by the number of shipments. Fluctuations in weight per shipment can indicate changes in the mix of freight we receive from our customers, as well as changes in the number of units included in a shipment. Generally, increases in weight per shipment indicate higher demand and overall increased economic activity. Changes in weight per shipment can also be influenced by shifts between LTL and other modes of transportation, such as truckload, in response to capacity, service and pricing issues. Fluctuations in weight per shipment generally have an inverse effect on our revenue per hundredweight, as a decrease in weight per shipment will typically cause an increase in revenue per hundredweight. •Revenue Per Hundredweight—Network revenue per every 100 pounds of shipment weight. Our LTL transportation services are generally priced based on weight, commodity, and distance. Our pricing policies are reflective of the services we provide and can be influenced by competitive market conditions. Changes in the freight profile factors such as average shipment size, average length of haul, freight density, and customer and geographic mix can impact the revenue per hundredweight. Fuel surcharges and intercompany revenue between Network and Truckload are included in this measurement. •Revenue Per Shipment—Network revenue divided by the number of shipments. Fuel surcharges and intercompany revenue between Network and Truckload are included in this measurement. •Average Length of Haul—Total miles between origin and destination service centers for all shipments, with miles based on the size of shipments. Length of haul is used to analyze our tonnage and pricing trends for shipments with similar characteristics. Changes in length of haul generally have a direct effect on our revenue per hundredweight, as an increase in length of haul will typically cause an increase in revenue per hundredweight. 20 Table of Contents Within our Intermodal reportable segment, our primary revenue focus is to increase the number of shipments. The key operating statistic necessary to understand the operating results of our Intermodal reportable segment is described below in more detail: •Drayage Revenue Per Shipment—Intermodal revenue divided by the number of drayage shipments. Revenue derived from CFS warehouse and handling, and linehaul and LTL services is excluded from this measurement. Fuel surcharges and accessorial charges are included in this measurement. Trends and Developments Economy Our business is highly susceptible to changes in economic conditions. Our products and services are directly tied to the production and sale of goods and, more generally, to the global economy. Participants in the transportation industry have historically experienced cyclical fluctuations in financial results due to economic recessions, downturns in the business cycles of customers, volatility in the prices charged by third-party carriers, interest rate fluctuations and other U.S. and global macroeconomic developments. During economic downturns, reductions in overall demand for transportation services will likely reduce demand for our services and exert downward pressure on our rates and margins. In periods of strong economic growth, overall demand may exceed the available supply of transportation resources. While this may present an opportunity to increase economies of scale in our network and enhanced pricing and margins, these benefits may be lessened by increased network congestion and operating inefficiencies. Like other providers of freight transportation services, our business has been impacted by the macroeconomic conditions of the past few years. Industry freight volumes, as measured by the Cass Freight Index, decreased in the first half of 2026 compared to the comparable period in 2025. Recent global disruptions, such as conflicts in the Middle East, have had an impact on freight demand, which has led to an overall continued decrease in total number of shipments. Such disruptions may continue with a resolution timeline remaining unclear. Intermodal volumes, heavily influenced by United States imports, have decreased due to a number of factors that impact import levels. For Truckload, starting in late 2025 and into 2026, tightening capacity levels with relatively stabilized demand have created an increase in spot market truckload rates. Spot rates have been further impacted by increases in fuel costs, which increase our fuel surcharge revenue and also increase the cost of purchased transportation. Strategic Review In January 2025, the Board of Directors (the “Board”) announced that it had initiated a comprehensive review of strategic alternatives to maximize shareholder value and retained Goldman Sachs & Co. LLC to serve as its financial advisor. This process included extensive negotiations and discussions with multiple parties; however, due to a variety of factors, no actionable proposals for a sale of the Company were ultimately received. As part of its ongoing efforts to execute the Company’s strategic plan and drive value creation for all shareholders, the Board has authorized the exploration of potential transactions involving certain non-core assets, including the Company's Intermodal segment, and certain components of the Omni Logistics segment. The Company expects such actions, if consummated, to support portfolio optimization, enhance liquidity, reduce leverage, and strengthen its balance sheet. The Company completed the sale of two business units within its Omni Logistics segment, the first of which closed during the second quarter of 2026 and the second of which closed in July 2026. In addition to these actions, the Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value. There can be no assurances that any additional sale or other transaction will be approved by the Board or otherwise consummated. The Company does not intend to disclose developments relating to these initiatives until it determines that further disclosure is appropriate or necessary. Customer Update During the first quarter of 2026, we commenced preliminary discussions with our largest customer (the “Customer”) regarding a potential transition of a portion of the Customer's contract logistics business to other suppliers for reasons related to the Customer's operations and supplier diversification initiatives. During the second quarter of 2026, these discussions progressed, and we engaged in more advanced negotiations. We have provided the highest level of service excellence and exceeded all of our KPIs on a regular basis throughout the duration of our 25-year relationship with the Customer. The Customer continued growing their relationship with us over the past two years. Their revenue represented slightly less than 10% of our consolidated operating revenue for the year ended December 31, 2025, and approximately 12% of consolidated operating revenues for both the three and six months ended June 30, 2026. The Customer is concentrated in the Omni Logistics segment. 21 Table of Contents In July 2026, we entered into a non-binding memorandum of understanding (the “MOU”), pursuant to which we would retain approximately 50% of the services revenue provided to the Customer in 2025, with the potential of retaining an additional 25% of service revenues, subject to the execution of a definitive agreement. The transfer of the portion of the business that is expected to be transitioned to third parties is expected to begin in December 2026 with the transition continuing through 2027. We continue to negotiate the terms of the transition, including any related termination or disentanglement fees and the transfer of any leases. Additionally, we continue to explore all options to retain as much of this business as possible. We remain focused on delivering industry leading solutions and service to all of our global customer base and believe that continued execution of our strategy will allow us to regain market share over time. Results from Operations — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025 Three Months Ended June 30, (in thousands) 2026 2025 $ Change % Change Operating revenues: Expedited Freight $ 319,062 $ 257,696 $ 61,366 23.8 % Omni Logistics 338,547 328,316 10,231 3.1 % Intermodal 59,724 59,146 578 1.0 % Corporate and Eliminations (44,297) (26,314) (17,983) (68.3) % Total operating revenues 673,036 618,844 54,192 8.8 % Operating expenses: Purchased transportation 335,892 303,300 32,592 10.7 % Salaries, wages and employee benefits 130,040 145,490 (15,450) (10.6) % Operating leases 50,252 49,505 747 1.5 % Depreciation and amortization 38,262 36,806 1,456 4.0 % Insurance and claims 13,678 15,536 (1,858) (12.0) % Fuel expense 6,644 5,278 1,366 25.9 % Other operating expenses 55,574 43,407 12,167 28.0 % Impairment of goodwill 244,006 — 244,006 nm Total operating expenses 874,348 599,322 275,026 45.9 % Operating (loss) income: Expedited Freight 34,893 19,495 15,398 79.0 % Omni Logistics (230,010) 7,186 (237,196) nm Intermodal 6,101 4,415 1,686 38.2 % Corporate and Eliminations (12,296) (11,574) (722) (6.2) % Total operating (loss) income (201,312) 19,522 (220,834) nm Other income and expenses: Interest expense, net (43,721) (45,326) 1,605 3.5 % Foreign exchange (loss) gain (566) (4,653) 4,087 87.8 % Other income (expense), net 1,569 (6,656) 8,225 123.6 % Total other expense (42,718) (56,635) 13,917 24.6 % Loss from continuing operations before income taxes (244,030) (37,113) (206,917) (557.5) % Income tax (benefit) expense (174) (16,749) 16,575 99.0 % Loss from continuing operations (243,856) (20,364) (223,492) nm Loss from discontinued operations, net of tax (2,075) — (2,075) nm Net loss (245,931) (20,364) (225,567) nm Net loss attributable to noncontrolling interest (38,631) (7,781) (30,850) (396.5) % Net loss attributable to Forward Air $ (207,300) $ (12,583) $ (194,717) nm nm = not meaningful 22 Table of Contents Operating Revenues Operating revenues increased $54.2 million, or 8.8%, to $673.0 million for the three months ended June 30, 2026 compared to $618.8 million for the three months ended June 30, 2025. The increase was primarily associated with an increase in tonnage shipped and revenue per hundredweight in our Expedited Freight segment. The results for our reportable segments are discussed in detail below. Operating Expenses Operating expenses increased $275.0 million, or 45.9%, to $874.3 million for the three months ended June 30, 2026 compared to $599.3 million for the three months ended June 30, 2025. The increase was primarily due to the $244.0 million goodwill impairment charge associated with our Omni Logistics segment and cost increases associated with the higher revenues. Refer to Note 5—Goodwill and Other Intangible Assets for additional information. Operating (Loss) Income Operating loss was $201.3 million for the three months ended June 30, 2026 compared to operating income of $19.5 million for the three months ended June 30, 2025. The change in operating loss was primarily due to the $244.0 million goodwill impairment charge associated with our Omni Logistics segment, partially offset by profit improvement due to increased revenues in our Expedited Freight segment. Total Other Expense Total other expense decreased $13.9 million, or 24.6%, to expense of $42.7 million for the three months ended June 30, 2026 compared to an expense of $56.6 million for the three months ended June 30, 2025. The decrease in total other expense was primarily due to a $1.2 million adjustment to decrease liabilities under the Tax Receivable Agreement in the three months ended June 30, 2026 compared to a $6.9 million adjustment to increase liabilities under the Tax Receivable Agreement in the prior period. Additionally, foreign currency exchange decreased by $4.1 million. These decreases were partially offset by a gain of $3.6 million on the sale of a business unit within our Omni Logistics segment during the three months ended June 30, 2026. Income Taxes The effective tax rate for the three months ended June 30, 2026 was 0.1% compared to 55.4% for the three months ended June 30, 2025. The effective tax rate for the three months ended June 30, 2026 and 2025 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of interest expense disallowances under IRC Section 163(j) for which a full valuation allowance was recorded on the deferred tax asset, noncontrolling interest, and foreign, state and local income taxes. Additionally, the effective tax rate for the three months ended June 30, 2026 varied from the statutory United States federal income tax rate of 21.0% due to the tax effects of the goodwill impairment and related change in the valuation allowance. Net Loss Attributable to Noncontrolling Interest The Company is organized as an umbrella partnership C Corporation. Net losses are allocated to noncontrolling interest holders based on the percentage ownership in Clue Opco LLC (“Opco”) of the Class B shareholders. Approximately 15.7% of consolidated net losses were attributed to noncontrolling interest for the three months ended June 30, 2026 compared to 38.2% for the three months ended June 30, 2025. The decrease in the percentage is due to exchanges of Class B shares to common stock from June 30, 2025 through June 30, 2026 and net losses for Forward Air Corporation, which are not allocated to noncontrolling interest and consist primarily of changes in the value of the Tax Receivable Agreement and the impact of income tax expense. 23 Table of Contents Expedited Freight — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025 Three Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenues: Network (1) $ 225,971 70.8 % $ 193,829 75.2 % $ 32,142 16.6 % Truckload 69,237 21.7 % 42,636 16.5 % 26,601 62.4 % Other 23,854 7.5 % 21,231 8.3 % 2,623 12.4 % Total operating revenues 319,062 100.0 % 257,696 100.0 % 61,366 23.8 % Operating expenses: Purchased transportation 167,936 52.6 % 124,448 48.3 % 43,488 34.9 % Salaries, wages and employee benefits 57,568 18.0 % 53,938 20.9 % 3,630 6.7 % Operating leases 16,416 5.1 % 17,355 6.7 % (939) (5.4) % Depreciation and amortization 8,495 2.7 % 10,357 4.0 % (1,862) (18.0) % Insurance and claims 10,018 3.1 % 10,693 4.1 % (675) (6.3) % Fuel expense 3,668 1.1 % 2,518 1.0 % 1,150 45.7 % Other operating expenses 20,068 6.5 % 18,892 7.4 % 1,176 6.2 % Total operating expenses 284,169 89.1 % 238,201 92.4 % 45,968 19.3 % Operating income $ 34,893 10.9 % $ 19,495 7.6 % $ 15,398 79.0 % (1)Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue. The following table sets forth the operating statistics of our Expedited Freight segment: Three Months Ended June 30, (in thousands, except per shipment and per hundredweight) 2026 2025 % Change Business days 64 64 — % Tonnage (1) Total pounds 665,073 623,394 6.7 % Pounds per day 10,392 9,741 6.7 % Shipments (1) Total shipments 749 739 1.4 % Shipments per day 11.7 11.5 1.7 % Weight per shipment 888 843 5.3 % Revenue per hundredweight (2) $ 33.98 $ 31.09 9.3 % Revenue per hundredweight, ex fuel (2) $ 24.26 $ 24.82 (2.3) % Revenue per shipment (2) $ 301.75 $ 261.82 15.3 % Revenue per shipment, ex fuel (2) $ 215.41 $ 209.24 2.9 % (1)Excludes accessorial and Truckload products. (2)Includes intercompany revenue between the Network and Truckload revenue streams. 24 Table of Contents Operating Revenues Operating revenues increased $61.4 million, or 23.8%, to $319.1 million for the three months ended June 30, 2026 from $257.7 million for the three months ended June 30, 2025. The increase was primarily due to increased Network revenues reflecting a 6.7% increase in tonnage and a 9.3% increase in revenue per hundredweight as compared to the same period in 2025. The increase in tonnage reflects an increase in shipments per day of 1.7% and an increase in weight per shipment of 5.3%. The increase in shipments is due to stronger demand for our services as industry capacity tightens. The increase in Truckload revenues resulted from an increase of $17.2 million in intersegment revenues with Omni Logistics' Ground operations and $9.5 million in operating revenues from the conversion of certain customers previously serviced by Omni Logistics in the prior year period. Purchased Transportation Purchased transportation increased $43.5 million, or 34.9%, to $167.9 million for the three months ended June 30, 2026 from $124.4 million for the three months ended June 30, 2025. Purchased transportation was 52.6% of operating revenues for the three months ended June 30, 2026 compared to 48.3% for the same period in 2025. Purchased transportation includes Leased Capacity Providers and third-party motor carriers and transportation intermediaries, while Company-employed drivers are included in salaries, wages and employee benefits. Purchased transportation increased in correlation with the increase in revenues period over period, and the mix of revenue between Network and Truckload where Truckload requires additional amounts of purchased transportation. Salaries, Wages and Employee Benefits Salaries, wages and employee benefits increased $3.6 million, or 6.7%, to $57.6 million for the three months ended June 30, 2026 from $53.9 million for the three months ended June 30, 2025. Salaries, wages and employee benefits were 18.0% of operating revenues for the three months ended June 30, 2026 compared to 20.9% for the same period in 2025. The increase in salaries, wages and employee benefits expense was primarily due to the 6.7% increase in tonnage moved period over period. Omni Logistics — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025 Three Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenues: Ground $ 132,854 39.2 % $ 155,430 47.3 % $ (22,576) (14.5) % Contract Logistics 112,332 33.2 % 97,469 29.7 % 14,863 15.2 % Air and Ocean 93,361 27.6 % 75,417 23.0 % 17,944 23.8 % Total operating revenues 338,547 100.0 % 328,316 100.0 % 10,231 3.1 % Operating expenses: Purchased transportation 190,166 56.2 % 185,040 56.4 % 5,126 2.8 % Salaries, wages and employee benefits 62,226 18.4 % 61,584 18.8 % 642 1.0 % Operating leases 27,466 8.1 % 25,686 7.8 % 1,780 6.9 % Depreciation and amortization 23,878 7.1 % 22,419 6.8 % 1,459 6.5 % Insurance and claims 276 0.1 % 1,248 0.4 % (972) (77.9) % Fuel expense 457 0.1 % 888 0.3 % (431) (48.5) % Other operating expenses 20,082 5.9 % 24,265 7.4 % (4,183) (17.2) % Impairment of goodwill 244,006 72.1 % — — % 244,006 nm Total operating expenses 568,557 167.9 % 321,130 97.8 % 247,427 77.0 % Operating (loss) income $ (230,010) (67.9) % $ 7,186 2.2 % $ (237,196) nm nm = not meaningful 25 Table of Contents Operating Revenues Operating revenues increased $10.2 million, or 3.1%, to $338.5 million for the three months ended June 30, 2026 from $328.3 million for the three months ended June 30, 2025. This was due to an increase in Contract Logistics and Air and Ocean services, partially offset by the decrease in Ground services. Contract Logistics and Air and Ocean services increased due to an increase in demand from our customers. Ground services during the three months ended June 30, 2026 decreased primarily due to the conversion of certain customers to Expedited Freight that were previously serviced by Omni Logistics in the prior period, as discussed above in the Expedited Freight segment section. Purchased Transportation Purchased transportation increased $5.1 million, or 2.8%, to $190.2 million for the three months ended June 30, 2026 from $185.0 million for the three months ended June 30, 2025. Purchased transportation was 56.2% of operating revenues for the three months ended June 30, 2026 compared to 56.4% for the same period in 2025. Purchased transportation increased primarily in correlation with the increase in revenues period over period. Other Operating Expenses Other operating expenses decreased $4.2 million, or 17.2%, to $20.1 million for the three months ended June 30, 2026 from $24.3 million for the three months ended June 30, 2025. Other operating expenses were 5.9% of operating revenues for the three months ended June 30, 2026 compared to 7.4% for the same period in 2025. Other operating expenses primarily decreased as a result of cost reduction efforts initiated by the Company beginning in 2025. Impairment of Goodwill During the three months ended June 30, 2026, we recorded a $244.0 million goodwill impairment charge as a result of the anticipated decrease in future revenues from the Customer, together with a sustained decrease in our stock price. There were no impairment charges during the three months ended June 30, 2025. Refer to Note 5—Goodwill and Other Intangible Assets for additional information. Intermodal — Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025 Three Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenues $ 59,724 100.0 % $ 59,146 100.0 % $ 578 1.0 % Operating expenses: Purchased transportation 22,087 37.0 % 20,049 33.9 % 2,038 10.2 % Salaries, wages and employee benefits 13,783 23.1 % 15,385 26.0 % (1,602) (10.4) % Operating leases 6,100 10.2 % 5,336 9.0 % 764 14.3 % Depreciation and amortization 3,882 6.5 % 4,502 7.6 % (620) (13.8) % Insurance and claims 1,799 3.0 % 3,147 5.3 % (1,348) (42.8) % Fuel expense 2,541 4.3 % 1,857 3.1 % 684 36.8 % Other operating expenses 3,431 5.7 % 4,455 7.6 % (1,024) (23.0) % Total operating expenses 53,623 89.8 % 54,731 92.5 % (1,108) (2.0) % Operating income $ 6,101 10.2 % $ 4,415 7.5 % $ 1,686 38.2 % The following table sets forth the operating statistics of our Intermodal segment: Three Months Ended June 30, 2026 2025 % Change Drayage shipments 61,909 62,313 (0.6) % Drayage revenue per shipment $ 942 $ 862 9.3 % 26 Table of Contents Operating Revenues Operating revenues increased $0.6 million, or 1.0%, to $59.7 million for the three months ended June 30, 2026 from $59.1 million for the three months ended June 30, 2025. This increase was driven by a 9.3% increase in drayage revenue per shipment, which was driven by an increase in the fuel portion of our drayage revenue, partially offset by a 0.6% reduction in drayage shipments. Operating revenues were impacted by a decrease in non-drayage revenue of $4.3 million as compared to the prior year period. Purchased Transportation Purchased transportation increased $2.0 million, or 10.2%, to $22.1 million for the three months ended June 30, 2026 from $20.0 million for the three months ended June 30, 2025. Purchased transportation was 37.0% of operating revenues for the three months ended June 30, 2026 compared to 33.9% for the same period in 2025. Purchased transportation includes Leased Capacity Providers and third-party motor carriers, while Company-employed drivers are included in salaries, wages and employee benefits. Purchased transportation as a percentage of operating revenues increased based on several factors including changes in mix of drayage and non-drayage revenues, length of haul, lane density, and mix of internal versus external miles driven. Salaries, Wages and Employee Benefits Salaries, wages and employee benefits decreased $1.6 million or 10.4%, to $13.8 million for the three months ended June 30, 2026 from $15.4 million for the three months ended June 30, 2025. Salaries, wages and employee benefits were 23.1% of operating revenues for the three months ended June 30, 2026 compared to 26.0% for the same period in 2025. Salaries, wages and employee benefits decreased primarily due to the decrease in drayage shipments and the decrease in non-drayage revenues during the current year period. Insurance and Claims Insurance and claims decreased $1.3 million, or 42.8%, to $1.8 million for the three months ended June 30, 2026 from $3.1 million for the three months ended June 30, 2025. Insurance and claims were 3.0% of operating revenues for the three months ended June 30, 2026 compared to 5.3% for the same period in 2025. The decrease in insurance and claims was primarily due to claims reimbursements received during the three months ended June 30, 2026. Other Operating Expenses Other operating expenses decreased $1.0 million, or 23.0%, to $3.4 million for the three months ended June 30, 2026 from $4.5 million for the three months ended June 30, 2025. Other operating expenses were 5.7% of operating revenues for the three months ended June 30, 2026 compared to 7.6% for the same period in 2025. The decrease in other operating expenses as a percentage of revenue was primarily driven by cost reductions in response to the decrease in revenue. 27 Table of Contents Results from Operations — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025 Six Months Ended June 30, (in thousands) 2026 2025 $ Change % Change Operating revenues: Expedited Freight $ 591,769 $ 507,077 $ 84,692 16.7 % Omni Logistics 640,965 651,786 (10,821) (1.7) % Intermodal 112,816 121,638 (8,822) (7.3) % Corporate and Eliminations (90,468) (48,376) (42,092) (87.0) % Total operating revenues 1,255,082 1,232,125 22,957 1.9 % Operating expenses: Purchased transportation 619,669 607,562 12,107 2.0 % Salaries, wages and employee benefits 245,616 287,405 (41,789) (14.5) % Operating leases 99,965 98,298 1,667 1.7 % Depreciation and amortization 76,783 74,166 2,617 3.5 % Insurance and claims 27,176 30,542 (3,366) (11.0) % Fuel expense 11,571 10,927 644 5.9 % Other operating expenses 111,167 98,940 12,227 12.4 % Impairment of goodwill 244,006 — 244,006 nm Total operating expenses 1,435,953 1,207,840 228,113 18.9 % Operating (loss) income: Expedited Freight 54,939 35,129 19,810 56.4 % Omni Logistics (229,280) 10,561 (239,841) nm Intermodal 7,325 9,957 (2,632) (26.4) % Corporate and Eliminations (13,855) (31,362) 17,507 55.8 % Total operating (loss) income (180,871) 24,285 (205,156) nm Other income and expenses: Interest expense, net (87,308) (90,873) 3,565 3.9 % Foreign exchange gain (loss) 1,132 (5,575) 6,707 120.3 % Other expense, net (15,388) (6,552) (8,836) (134.9) % Total other expense (101,564) (103,000) 1,436 1.4 % Loss from continuing operations before income taxes (282,435) (78,715) (203,720) (258.8) % Income tax expense 1,619 2,840 (1,221) (43.0) % Loss from continuing operations (284,054) (81,555) (202,499) (248.3) % Loss from discontinued operations, net of tax (2,075) — (2,075) nm Net loss (286,129) (81,555) (204,574) (250.8) % Net loss attributable to noncontrolling interest (44,510) (18,335) (26,175) (142.8) % Net loss attributable to Forward Air $ (241,619) $ (63,220) $ (178,399) (282.2) % nm = not meaningful Operating Revenues Operating revenues increased $23.0 million, or 1.9% to $1,255.1 million for the six months ended June 30, 2026 compared to $1,232.1 million for the six months ended June 30, 2025. The increase was primarily associated with an increase in tonnage shipped and an increase in revenue per hundredweight in our Expedited Freight segment. The results for our reportable segments are discussed in detail below. 28 Table of Contents Operating Expenses Operating expenses increased $228.1 million, or 18.9%, to $1,436.0 million for the six months ended June 30, 2026 compared to $1,207.8 million for the six months ended June 30, 2025. The increase was primarily due to the $244.0 million goodwill impairment charge associated with our Omni Logistics segment and increased other operating expenses, partially offset by reductions in salaries, wages and employee benefits. Refer to Note 5—Goodwill and Other Intangible Assets for additional information. Operating (Loss) Income Operating loss was $180.9 million for the six months ended June 30, 2026 compared to operating income of $24.3 million for the six months ended June 30, 2025. The change in operating loss was primarily due to the $244.0 million goodwill impairment charge associated with our Omni Logistics segment, partially offset by profit improvement due to increased revenues in our Expedited Freight segment and a reduction in Corporate expenses. Total Other Expense Total other expense decreased $1.4 million, or 1.4%, to expense of $101.6 million for the six months ended June 30, 2026 compared to an expense of $103.0 million for the six months ended June 30, 2025. The decrease in total other expense was primarily due to a decrease in foreign currency exchange of $6.7 million and a decrease of interest expense of $3.6 million compared to the same period in the prior year. Partially offsetting these decreases is an $8.6 million increase in expense associated with the liabilities under the Tax Receivable Agreement. Income Taxes The effective tax rate for the six months ended June 30, 2026 was (0.6)% compared to (3.6)% for the six months ended June 30, 2025. The effective tax rate for the six months ended June 30, 2026 and 2025 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of interest expense disallowances under IRC Section 163(j) for which a full valuation allowance is recorded on the deferred tax asset, noncontrolling interest, and foreign and state and local income taxes. Additionally, the effective tax rate for the six months ended June 30, 2026 varied from the statutory United States federal income tax rate of 21.0% due to the tax effects of the goodwill impairment and related change in the valuation allowance. Net Loss Attributable to Noncontrolling Interest The Company is organized as an umbrella partnership C Corporation. Net losses are allocated to noncontrolling interest holders based on the percentage ownership in Opco of the Class B shareholders. Approximately 15.6% of consolidated net losses were attributed to noncontrolling interest for the six months ended June 30, 2026 compared to 22.5% for the six months ended June 30, 2025. The decrease in the percentage is due to exchanges of Class B shares to common stock from June 30, 2025 through June 30, 2026 and net losses for Forward Air Corporation, which are not allocated to noncontrolling interest and consist primarily of changes in the value of the Tax Receivable Agreement liability and the impact of income tax expense. 29 Table of Contents Expedited Freight — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025 Six Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenues: Network (1) $ 414,148 70.0 % $ 383,991 75.7 % $ 30,157 7.9 % Truckload 131,781 22.3 % 81,891 16.1 % 49,890 60.9 % Other 45,840 7.7 % 41,195 8.2 % 4,645 11.3 % Total operating revenues 591,769 100.0 % 507,077 100.0 % 84,692 16.7 % Operating expenses: Purchased transportation 309,619 52.3 % 245,128 48.3 % 64,491 26.3 % Salaries, wages and employee benefits 113,218 19.1 % 106,515 21.0 % 6,703 6.3 % Operating leases 31,944 5.4 % 32,788 6.5 % (844) (2.6) % Depreciation and amortization 16,807 2.8 % 20,736 4.1 % (3,929) (18.9) % Insurance and claims 20,178 3.4 % 21,001 4.1 % (823) (3.9) % Fuel expense 5,721 1.0 % 4,989 1.0 % 732 14.7 % Other operating expenses 39,343 7.0 % 40,791 8.1 % (1,448) (3.5) % Total operating expenses 536,830 90.7 % 471,948 93.1 % 64,882 13.7 % Operating income $ 54,939 9.3 % $ 35,129 6.9 % $ 19,810 56.4 % (1)Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue. The following table sets forth the operating statistics of our Expedited Freight segment: Six Months Ended June 30, (in thousands, except per shipment and per hundredweight) 2026 2025 % Change Business days 127 127 — % Tonnage (1) Total pounds 1,263,527 1,234,029 2.4 % Pounds per day 9,949 9,717 2.4 % Shipments (1) Total shipments 1,439 1,466 (1.8) % Shipments per day 11.3 11.5 (1.7) % Weight per shipment 878 842 4.3 % Revenue per hundredweight (2) $ 32.78 $ 31.13 5.3 % Revenue per hundredweight, ex fuel (2) $ 24.37 $ 24.79 (1.7) % Revenue per shipment (2) $ 287.75 $ 261.93 9.9 % Revenue per shipment, ex fuel (2) $ 213.95 $ 208.64 2.5 % (1)Excludes accessorial and Truckload products. (2)Includes intercompany revenue between the Network and Truckload revenue streams. 30 Table of Contents Operating Revenues Operating revenues increased $84.7 million, or 16.7%, to $591.8 million for the six months ended June 30, 2026 from $507.1 million for the six months ended June 30, 2025. The increase was primarily due to increased Truckload revenues, which resulted from an increase of $37.2 million in intersegment revenues with Omni Logistics' Ground operations and $16.7 million in operating revenues from the conversion of certain customers previously serviced by Omni Logistics in the prior year. Network revenues increased reflecting a 2.4% increase in tonnage and a 5.3% increase in revenue per hundredweight as compared to the same period in the prior year. Purchased Transportation Purchased transportation increased $64.5 million, or 26.3%, to $309.6 million for the six months ended June 30, 2026 from $245.1 million for the six months ended June 30, 2025. Purchased transportation was 52.3% of operating revenue for the six months ended June 30, 2026 compared to 48.3% for the same period in 2025. Purchased transportation includes Leased Capacity Providers, third-party motor carriers, and transportation intermediaries, while Company-employed drivers are included in salaries, wages and employee benefits. Purchased transportation primarily increased in correlation with the increase in revenues compared to the same period in the prior year and the mix of revenue between Network and Truckload where Truckload requires additional amounts of purchased transportation. Salaries, Wages, and Employee Benefits Salaries, wages and employee benefits increased $6.7 million, or 6.3%, to $113.2 million for the six months ended June 30, 2026 from $106.5 million for the six months ended June 30, 2025. Salaries, wages and employee benefits were 19.1% of operating revenues for the six months ended June 30, 2026 compared to 21.0% for the same period in 2025. The increase in salaries, wages and employee benefits expense was primarily due to revenue increases compared to the same period in the prior year. Operating Income Operating income increased $19.8 million, or 56.4%, to $54.9 million for the six months ended June 30, 2026 compared to $35.1 million for the six months ended June 30, 2025. Operating income was 9.3% of operating revenues for the six months ended June 30, 2026 compared to 6.9% for the same period in 2025. The increase in operating income was primarily due to increased revenues and improved operating leverage compared to the same period in the prior year. Omni Logistics — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025 Six Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenue Ground $ 268,841 41.9 % $ 327,524 50.3 % $ (58,683) (17.9) % Contract Logistics 216,498 33.8 % 177,597 27.2 % 38,901 21.9 % Air and Ocean 155,626 24.3 % 146,665 22.5 % 8,961 6.1 % Total operating revenues 640,965 100.0 % 651,786 100.0 % (10,821) (1.7) % Operating expenses: Purchased transportation 359,089 56.0 % 370,774 56.9 % (11,685) (3.2) % Salaries, wages and employee benefits 115,622 18.0 % 118,367 18.2 % (2,745) (2.3) % Operating leases 55,168 8.6 % 52,776 8.1 % 2,392 4.5 % Depreciation and amortization 48,369 7.5 % 44,649 6.9 % 3,720 8.3 % Insurance and claims 744 0.1 % 3,863 0.6 % (3,119) (80.7) % Fuel expense 961 0.1 % 1,905 0.3 % (944) (49.6) % Other operating expenses 46,286 7.2 % 48,891 7.5 % (2,605) (5.3) % Impairment of goodwill 244,006 38.1 % — — % 244,006 nm Total operating expenses 870,245 135.8 % 641,225 98.4 % 229,020 35.7 % Operating (loss) income $ (229,280) (35.8) % $ 10,561 1.6 % $ (239,841) nm nm = not meaningful 31 Table of Contents Operating Revenues Operating revenues decreased $10.8 million, or 1.7%, to $641.0 million for the six months ended June 30, 2026 from $651.8 million for the six months ended June 30, 2025. This was due to a decrease in Ground services, partially offset by an increase in Contract Logistics and Air and Ocean services. Ground services for the six months ended June 30, 2026 decreased primarily due to the conversion of certain customers to Expedited Freight that were previously serviced by Omni Logistics in the prior year, as discussed above in the Expedited Freight segment section. Contract Logistics and Air and Ocean services increased due to an increase in demand from our customers. Purchased Transportation Purchased transportation decreased $11.7 million, or 3.2%, to $359.1 million for the six months ended June 30, 2026 from $370.8 million for the six months ended June 30, 2025. Purchased transportation was 56.0% of operating revenues for the six months ended June 30, 2026 compared to 56.9% for the six months ended June 30, 2025. The decrease was primarily driven by a reduction in operating revenue and a favorable shift in product mix. This shift included an increase in Contract Logistics, which generally require lower levels of purchased transportation compared to Ground and Air and Ocean services. Salaries, Wages and Employee Benefits Salaries, wages and employee benefits decreased $2.7 million or 2.3%, to $115.6 million for the six months ended June 30, 2026 from $118.4 million for the six months ended June 30, 2025. Salaries, wages and employee benefits were 18.0% of operating revenues for the six months ended June 30, 2026 compared to 18.2% for the same period in 2025. Salaries, wages and employee benefits primarily decreased due to the lower operating revenues during the current year period. Insurance and Claims Insurance and claims decreased $3.1 million, or 80.7%, to $0.7 million for the three months ended June 30, 2026 from $3.9 million for the three months ended June 30, 2025. Insurance and claims were 0.1% of operating revenues for the three months ended June 30, 2026 compared to 0.6% for the same period in 2025. The decrease in insurance and claims was primarily due to timing of claims and insurance reimbursements. Other Operating Expenses Other operating expenses decreased $2.6 million, or 5.3%, to $46.3 million for the six months ended June 30, 2026 from $48.9 million for the six months ended June 30, 2025. Other operating expenses were 7.2% of operating revenues for the six months ended June 30, 2026 compared to 7.5% for the same period in 2025. Other operating expenses primarily decreased due to cost reduction efforts initiated by the Company beginning in 2025. Impairment of Goodwill During the six months ended June 30, 2026, we recorded a $244.0 million goodwill impairment charge as a result of the anticipated decrease in future revenues from the Customer, together with a sustained decrease in our stock price. There were no impairment charges during the six months ended June 30, 2025. Refer to Note 5—Goodwill and Other Intangible Assets for additional information. Operating (Loss) Income Operating loss was $229.3 million during the six months ended June 30, 2026 compared to operating income of $10.6 million for the six months ended June 30, 2025. The change in operating loss was primarily due to the $244.0 million impairment of goodwill. 32 Table of Contents Intermodal — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025 Six Months Ended June 30, (in thousands) 2026 % of Revenue 2025 % of Revenue $ Change % Change Operating revenue $ 112,816 100.0 % $ 121,638 100.0 % $ (8,822) (7.3) % Operating expenses: Purchased transportation 41,429 36.7 % 40,225 33.1 % 1,204 3.0 % Salaries, wages and employee benefits 27,446 24.3 % 31,316 25.7 % (3,870) (12.4) % Operating leases 11,881 10.5 % 11,114 9.1 % 767 6.9 % Depreciation and amortization 8,035 7.1 % 9,222 7.6 % (1,187) (12.9) % Insurance and claims 4,570 4.1 % 5,938 4.9 % (1,368) (23.0) % Fuel expense 4,911 4.4 % 4,012 3.3 % 899 22.4 % Other operating expenses 7,219 6.4 % 9,854 8.1 % (2,635) (26.7) % Total operating expenses 105,491 93.5 % 111,681 91.8 % (6,190) (5.5) % Operating income $ 7,325 6.5 % $ 9,957 8.2 % $ (2,632) (26.4) % The following table sets forth the operating statistics of our Intermodal segment: Six Months Ended June 30, 2026 2025 % Change Drayage shipments 120,685 126,762 (4.8) % Drayage revenue per shipment $ 910 $ 872 4.4 % Operating Revenues Operating revenues decreased $8.8 million, or 7.3%, to $112.8 million for the six months ended June 30, 2026 from $121.6 million for the six months ended June 30, 2025. This decrease was primarily due to loss of non-drayage revenue, which represented $8.2 million of operating revenues for the six months ended June 30, 2025. The decrease in operating revenues was also driven by a 4.8% reduction in drayage shipments, partially offset by a 4.4% increase in drayage revenue per shipment, which was driven by an increase in the fuel portion of our drayage revenue. The lower shipment volumes resulted from our customer base being negatively affected by international trade restrictions, which led to reduced activity at seaports and railheads. Purchased Transportation Purchased transportation increased $1.2 million, or 3.0%, to $41.4 million for the six months ended June 30, 2026 from $40.2 million for the six months ended June 30, 2025. Purchased transportation was 36.7% of operating revenues for the six months ended June 30, 2026 compared to 33.1% for the same period in 2025. Purchased transportation includes Leased Capacity Providers and third-party motor carriers, while Company-employed drivers are included in salaries, wages and employee benefits. Purchased transportation as a percentage of operating revenues increased based on several factors including changes in mix of drayage and non-drayage revenues, length of haul, lane density, and mix of internal versus external miles driven. Salaries, Wages, and Employee Benefits Salaries, wages and employee benefits decreased $3.9 million, or 12.4%, to $27.4 million for the six months ended June 30, 2026 compared to $31.3 million for the six months ended June 30, 2025. Salaries, wages and employee benefits were 24.3% of operating revenues for the six months ended June 30, 2026 compared to 25.7% for the same period in 2025. Salaries, wages and employee benefits decreased primarily due to the decrease in drayage shipments and the decrease in non-drayage revenues during the current year period. Other Operating Expenses Other operating expenses decreased $2.6 million, or 26.7%, to $7.2 million for the six months ended June 30, 2026 compared to $9.9 million for the six months ended June 30, 2025. Other operating expenses were 6.4% of operating revenues for the six months ended June 30, 2026 compared to 8.1% for the same period in 2025. The decrease in other operating expenses as a percentage of revenue was primarily driven by cost reductions in response to the decrease in revenue. 33 Table of Contents Operating Income Operating income decreased by $2.6 million, or 26.4%, to $7.3 million for the six months ended June 30, 2026 compared to $10.0 million for the six months ended June 30, 2025. Operating income was 6.5% of operating revenue for the six months ended June 30, 2026 compared to 8.2% for the same period in 2025. The change in operating income was primarily due to a decrease in drayage shipments and the increase in drayage revenue per shipment was not offset by enough cost reductions. Corporate — Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025 Corporate included a $13.9 million operating loss during the six months ended June 30, 2026 compared to a $31.4 million operating loss during the six months ended June 30, 2025. The change in operating loss was primarily driven by $8.2 million of professional fees incurred in 2026 for transaction and integration costs as compared to $21.1 million of professional fees in 2025 and an $8.7 million decrease associated with healthcare costs. Liquidity and Capital Resources We have historically financed our working capital needs, including capital expenditures, with available cash, cash flows from operations and borrowings under our $300.0 million revolving credit facility (the “Revolving Credit Facility”) pursuant to our credit agreement with Citibank, N.A., as administrative agent and collateral agent and as initial term loan lender (the “Credit Agreement”). We believe that availability of borrowings under our Credit Agreement together with available cash and internally generated funds will be sufficient to support our working capital, capital expenditures and debt service requirements over the next twelve months. The Credit Agreement requires the Company to maintain a leverage ratio (as defined in the Credit Agreement), which is tested quarterly and currently must not be greater than 6.00 to 1.00. As of June 30, 2026, the Company’s leverage ratio was 5.2 to 1.00. The required leverage ratio will decrease by 0.25 turns at the end of each quarter in 2026 to 5.50 to 1 at the end of December 31, 2026 and all quarters thereafter, as defined in the Credit Agreement. Failure to comply with this covenant would result in an event of default under the Credit Agreement and, absent a waiver from the lenders or an amendment to the Credit Agreement, preclude the Company from making further borrowings under the Revolving Credit portion of the Credit Agreement and permit the lenders to accelerate all outstanding borrowings under the Credit Agreement, including the term loan portion. The Company expects to maintain compliance with the leverage ratio during the next twelve months. Cash Flows Net cash provided by operating activities was $40.9 million for the six months ended June 30, 2026 compared to $14.4 million for the six months ended June 30, 2025. The increase in net cash provided by operating activities was primarily due to the increase in cash-based operating income. Net cash provided by investing activities was $1.1 million for the six months ended June 30, 2026 compared to net cash used in investing activities of $15.1 million for the six months ended June 30, 2025. Capital expenditures for the six months ended June 30, 2026 and 2025 were $10.2 million and $16.7 million, respectively, which primarily related to the purchase of technology and operating equipment. Additionally, we received net proceeds of $8.7 million from the sale of a business during the six months ended June 30, 2026, with no comparable transaction during the six months ended June 30, 2025. Net cash used in financing activities was $8.4 million for the six months ended June 30, 2026 compared to $9.9 million for the six months ended June 30, 2025. The change in net cash used in financing activities was primarily due to lower repayments on finance lease obligations for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.

Legal Proceedings

On September 26, 2023, Rodney Bell, Michael A. Roberts and Theresa Woods (collectively, the “Original Plaintiffs”), three of our shareholders, filed a complaint against the Company and certain of its directors and officers in the Third District Chancery Court (the “Chancery Court”) sitting in Greeneville, Tennessee (the “Shareholder Complaint”). The Shareholder Complaint alleges, among other things, that the Company’s shareholders had the right to vote on certain transactions contemplated by the Merger Agreement and sought an injunction against the consummation of the transactions until a shareholder vote was held. The court initially granted a temporary restraining order enjoining the transactions contemplated by the Merger Agreement from closing but later dissolved it on October 25, 2023. Thereafter, the parties to the Amended Merger Agreement completed the Omni Acquisition. On May 2, 2024, Original Plaintiff Michael Roberts, together with the Cambria County Employees Retirement System (together, “Plaintiffs”) filed a stipulation and proposed order seeking leave of court to file an amended class action complaint seeking damages, among other forms of relief. Upon receiving leave of court, on May 15, 2024, the Plaintiffs filed the amended complaint (“Second Amended Complaint”). Like the earlier Shareholder Complaint (and subsequent amendment), the Second Amended Complaint challenges the directors’ determination not to subject the Omni Acquisition to a shareholder vote and alleges that, in so doing, the Company and certain of its now former directors (collectively, “Defendants,” and together with Plaintiffs, the “Parties”) violated Tennessee corporate law. The Second Amended Complaint further alleges that certain of the Company’s now former directors breached their fiduciary duties to shareholders by depriving them of the right to vote on the Omni Acquisition. Thereafter, on June 14, 2024, Defendants removed the case to the United States District Court for the Eastern District of Tennessee (the “District Court”), Greeneville Division. Plaintiffs filed a motion to remand the case to the Chancery Court, and on March 31, 2025, the District Court granted the motion and remanded the case back to the Chancery Court. On September 12, 2025, the Parties informed the Chancery Court that they had reached an agreement in principle to resolve the Action (the “Settlement”). The entire settlement amount will be funded by the Company's D&O insurers. In exchange, the Plaintiffs and the class (as defined in the agreements memorializing the Settlement) will grant customary releases in favor of Defendants of all of their claims that were or could have been asserted in the Action. On March 6, 2026, the Chancery Court entered a Scheduling Order with Respect to Notice and Settlement Hearing, scheduling a hearing to, among other things, determine whether the Settlement should be approved and the Action dismissed with prejudice. The Settlement Hearing occurred on July 21, 2026. At the conclusion of the hearing, the Chancery Court orally granted Plaintiffs’ Motion for Final Approval of Class Action Settlement and Approval of Plan of Allocation and Plaintiffs’ counsel’s Motion for an Award of Attorneys’ Fees and Expenses, and for Service Awards to Plaintiffs. The Chancery Court advised the parties that a final written order memorializing the oral ruling and dismissing the Action with prejudice is forthcoming. By entering into the Settlement, the Defendants are in no way conceding or admitting liability for any of the claims that were or could have been asserted in the Action. The Defendants expressly have denied and continue to deny each and all of the claims asserted in the Action, and maintain that their conduct was at all times proper, in the best interests of the Company and its stockholders, and in compliance with applicable law. Nevertheless, Defendants have determined to enter into the Settlement solely to put the claims to rest, finally and forever, and to eliminate the uncertainty, risk, costs, and burdens inherent in any litigation, including the Action. From time to time, we are also a party to other litigation incidental to and arising in the normal course of our business, most of which involve claims for personal injury and property damage related to the transportation and handling of freight, or workers’ compensation. We accrue for the estimated losses from these and other pending claims when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Based on the knowledge of the facts, we believe the resolution of such incidental claims and pending litigation, taking into account existing reserves, will not have a material adverse effect on our business, financial condition or results of operations. However, the results of complex legal proceedings are difficult to predict, and our view of these matters may change in the future as the litigation and related events unfold. For information regarding our legal proceedings, see Note 7—Commitments and Contingencies in our unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.

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Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition and/or operating results. The risks discussed in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. 36 Table of Contents Other than the following risk factors, which update and replace in their entirety the risk factors titled “We cannot assure you that our evaluation of strategic alternatives will result in any particular outcome, and the perceived uncertainties related to the Company could adversely affect our business and our stockholders,” “We derive a significant portion of our revenue from a few major customers, the loss of one or more of which could have a material adverse effect on our business” and “We experience customer concentration which could adversely impact our financial condition and results of operations,” there have been no material changes to the risk factors identified in Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2025. Market, customer and vendor perception regarding the conclusion of the strategic review process and uncertainty regarding the Board’s pursuit of other strategic initiatives could adversely affect our business and cause the price of our shares to fluctuate significantly. In January 2025, the Board of Directors (the “Board”) initiated a comprehensive review of strategic alternatives to maximize shareholder value, exploring a range of options relative to the long-term value potential of the Company on a standalone basis. The process included extensive negotiations and discussions with multiple parties. However, due to a variety of factors no actionable proposals for a sale of the Company were ultimately received. The Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value, and has determined to pursue a potential sale of non-core assets, including our Intermodal segment and two of our smaller legacy Omni businesses, the first of which closed during the second quarter of 2026 and the second of which closed in July 2026. Although the Board intends to pursue other strategic initiatives, including the disposition of non-core assets, there can be no assurance that we will be successful in implementing or executing on any such initiatives or that any such initiatives will be successful or drive the expected, or any, value creation. In addition, market, customer and vendor perception regarding the conclusion of the strategic review process and uncertainty regarding the Board’s consideration, and any impact, of other opportunities could materially adversely affect our business, financial condition and/or operating results and cause the price of our shares to fluctuate significantly. We experience customer concentration which could adversely impact our financial condition and results of operations. Our top ten customers, based on revenue, accounted for approximately 26% of our revenue for the year ended December 31, 2025, with one customer (the “Customer”) accounting for slightly less than 10% of consolidated operating revenues for year ended December 31, 2025, and approximately 12% of consolidated operating revenues for both the three and six months ended June 30, 2026. These customers can impact our revenues and profitability based on factors such as: (i) industry trends related to e-commerce that may apply downward pricing pressures on the rates our customers can charge; (ii) seasonality; (iii) business combinations and the overall growth of a customer’s underlying business; and (iv) any disruptions to our customers’ businesses. If these customers choose to divert all or a portion of their business with us to one of our competitors, demand pricing concessions for our services, require us to provide enhanced services that increase our costs, or develop their own shipping and distribution capabilities it may have a material adverse effect on our business and operating results. As previously disclosed, we have been in active discussions with the Customer regarding the transition of a portion of the Customer’s contract logistics business with us to other suppliers for reasons related to the Customer’s operations and supplier diversification initiatives. Although we entered into a non-binding memorandum of understanding with the Customer regarding the continued provision of at least half of the approximate $250 million of revenue attributable to the Customer for the year ended December 31, 2025, we are continuing to negotiate a definitive agreement with the Customer with respect to the retention of services and the terms of the transition of services that are not being retained, including any related termination or disentanglement fees and the transfer of any leases. If the Customer transitions a greater portion of its business than currently anticipated, or if the anticipated transition otherwise occurs on terms less favorable than expected, our business, financial condition and/or operating results will be materially adversely affected. In addition, we expect that any definitive agreement with the Customer will contain customary termination rights which, if exercised could, in the future, have a negative impact on our business, financial condition and/or operating results.