PACCAR Inc.

Good morning, and welcome to Packer's first quarter 2026 earnings conference call. All lines will be in a listen-only mode until the question and answer session. Today's call is being recorded, and if anyone has an objection, they should disconnect at this time. I would now like to introduce Mr. Ken Hastings, Packer's Director of Investor Relations. Mr. Hastings, please go ahead.

Good morning and welcome, everyone. My name is Ken Hastings, PACR's Director of Investor Relations, and joining me this morning are Preston Fite, Chief Executive Officer, Kevin Boehne, President, and Bryce Poplosky, Senior Vice President and Chief Financial Officer. As with prior conference calls, we ask that any members of the media on the line participate in a listen-only mode. Certain information presented today will be forward-looking and involve risks and uncertainties that may affect expected results. For additional information, please see our SEC filings at the Investor Relations page of PACCAR. I would now like to introduce Preston Fite.

Hey, thanks, Ken. Good morning, everyone. In the first quarter, PACCAR's outstanding employees did an excellent job providing our customers highest quality trucks and transportation solutions in the industry. I really appreciate their hard work, their high performance, and dedication as we increase build rates in our factories all around the world. PACCAR achieved revenues of $6.8 billion and net income of $605 million in the first quarter. These results were generated by strong PACCAR parts and financial services results, as well as solid growth in the truck businesses. Packer Parts achieved quarterly revenues of $1.7 billion and quarterly pre-tax income of $402 million. Packer Financial had a strong quarter, achieving pre-tax income of $116 million. Looking at this year's US and Canadian truck market, we estimate it to be in a range of 230,000 to 270,000 units. The market is strengthening as driver and fleet capacity becomes limited, and customers begin to realize higher freight rates. This is somewhat moderated by fuel and other operating costs volatility. In the first quarter, Kenworth launched a new C580 heavy-duty vocational truck. This large, multi-axle model was introduced at the ConExpo trade show and is a unique, super heavy-duty truck used in severe service applications around the world. We project the 2026 European above 16 ton market size to be in a range of 280 to 320,000. DOF's premium aerodynamic trucks provide customers with the latest technology and best operating efficiency. As mentioned on the January earnings call, the DOF XF and XD electric vehicles won the International Truck of the Year 2026 honor. In the first quarter, DOF extended its EV leadership by introducing new flagship XG and XG Plus electric vehicles. In addition, the XF Electric earned another award, the 2026 Eco-Friendly Truck of the Year in Spain. This year's South American above 16-ton market, where DAF trucks are desired by customers for their durability and advanced technology, is expected to be in a range of 100,000 to 110,000 vehicles. In the first quarter, PACCAR delivered 33,100 trucks, and in the second quarter will deliver an estimated 37 to 38,000 vehicles. PACCAR's truck, parts, and other gross margins increased from 12% to 13.1% in the first quarter due to improved truck segment performance. Second quarter margins are forecast to expand to around 13.5% as global production volumes increase. We anticipate continued performance improvements in the second half of the year as our customers benefit from our local-for-local manufacturing strategy, experience better operating conditions, and purchase trucks in front of the coming 2027 submissions change. PACCAR's exceptional range of trucks, compelling parts business, industry-leading financial services, and advanced technology strategy position the company well for an excellent future. Kevin will now provide an update on Packard Parts, financial services, and other business highlights.