Knight-Swift Transportation Holdings Inc.

Good afternoon. My name is Jillian Robinson, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Knight-Swift Transportation second quarter 2026 earnings call. All lines have been placed on mute to prevent any background noise. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. If at any time during this call you require immediate assistance, please press star zero for the operator. Speakers from today's call will be Adam Miller, Chief Executive Officer, Andrew Hess, Chief Financial Officer, Brad Stewart, Treasurer and Senior VP of Investor Relations. Mr. Stewart, the meeting is now yours.

Thank you, Jillian. Good afternoon, everyone, and thank you for joining our second quarter 2026 earnings call. Today, we plan to discuss topics related to the results of the quarter, current market conditions, and our earnings guidance. We have slides to accompany this call, which are posted on our investor website. Our call is scheduled to last one hour. Following our commentary, we will answer questions related to these topics. In order to get to as many participants as possible, we limit the questions to one per participant. If you have a second question, please feel free to get back in the queue. We will answer as many questions as time allows. and if we are not able to get to your question due to time restrictions, you may call 602-606-6349. To begin, I will first refer you to the disclosures on slide two of the presentation and note the following. This conference call and presentation may contain forward-looking statements made by the company that involve risks, assumptions and uncertainties that are difficult to predict. Investors are directed to the information contained in item 1A, Risk Factors or Part 1 of the company's annual report on Form 10-K with the United States SEC for discussion of the risks that may affect the company's future operating results. Actual results may differ. Now I'll hand the call over to Adam for some opening remarks.

Thank you, Brad, and good afternoon, everyone. So the truckload freight market has rapidly progressed over the past few months, with spot rates training well ahead of normal seasonality, tender rejection rates reaching levels not seen since 2021, and Contractual Bid Activity growing increasingly supportive. This has continued to be largely supply-driven, though signs of improving demand are starting to emerge. We believe our business is positioned particularly well for environments such as this, with our leading over-the-road scale, agility in the market to optimize yield, collaborative cross-brand solutions to meet shippers' needs, an industry-leading academy network and training infrastructure to source professional drivers, and an intense cultural focus on cost and excellence in execution to convert opportunities into earnings. Further, we believe demand for our truckload service offering is outpacing the market as evidenced by our tender rejection rates running roughly twice the level of public indications in the second quarter. Realized revenue per mile was just beginning to recover in the second quarter as contract rate improvement in the period was largely driven by bids priced early in the year. Revenue per mile accelerated in June as the more recent bids reflecting the tighter backdrop started taking effect. These bid outcomes largely brought double-digit percentage gains in pricing. In the third quarter, the planned annual bid events typically wind down, though mini-bid and turn-back bid activity is persisting, if not increasing, in recent weeks. Additionally, we continue working on rate reviews on existing business to address rates that are below market where the next schedule bid is too far out to be sustainable. We believe the efforts of the FMCSA and DOT, including initiatives to prevent and revoke invalidly issued CDLs, prevent cabotage, shut down noncompliant CDL schools, and address hour of service abuses are in the early stages and will continue for some time. This cleanup effort should, in our view, have an outsized impact on the one-way truckload market, particularly on the lowest price capacity. The service that was under the most pressure over the past few years is now benefiting the most from capacity exiting the system, a dynamic we expect will continue. Beyond the regulatory-driven pressure on supply, we believe the recent Montgomery ruling by the Supreme Court will add to the tightening in the truckload market as marginal carriers will likely be squeezed out through a combination of higher insurance costs and higher shipper and or broker selection standards. Given our longstanding commitment to safety and our significant investments made in support of it over many years, that the Montgomery ruling should not add cost to our asset-based business, but should rather bring some future opportunities to it. And so as for brokers, which we have a brokerage business as well, the Montgomery ruling could structurally change the economic incentives for a large share of the brokerage space that all too often have pursued the cheapest possible capacity with less regard for care, safety, and quality. And it will likely take time for cost pressures from insurance and litigation to drive behavior change for many, but shipper behavior could bring that about sooner to the extent shippers stiffen requirements or allocate freight differently to mitigate risk. Some shippers are starting to ask for higher insurance limits from brokers and carriers, ask questions about carrier vetting practices, or even insist on having the right to approve broker carriers before they can be assigned. On the insurance front, our view has been that premiums for broker liability insurance will climb over time as underwriters work through a reevaluation of the risk and as litigation emerges. Our brokerage insurance actually expired in June, and we were in market working towards renewal when the Montgomery ruling came out and that significantly impacted our renewal efforts. We have seen firsthand some of the changes that are just starting to develop in the insurance market. In addition to a significant reduction in insurance capacity, insurers are seeking to introduce exclusions regarding carrier vetting practices into the policies, which if not strictly followed would lead to a lack of coverage altogether for an accident. The good news is that feedback from insurers was that our carrier vetting is as rigorous as they've seen. But despite this, our premium rates increased to multiples of our prior coverage within just a few weeks of the Montgomery decision. So we expect insurance costs in this space will continue to climb. Improvements in carrier vetting will noticeably pressure the carrier base and gross margins for brokers who will need to make meaningful changes to their approach. While we regularly review our vetting approach and will continue to evaluate whether further refinements are feasible and effective, we believe our standards are already more stringent than most and are reflected in the size of our carrier base and our purchase transportation costs. The situation is very fluid and shippers, carriers, and brokers will navigate their respective risks and decisions as they see fit, but we believe the incremental opportunities for our business are greater than the incremental costs, especially for our asset division. Shippers continue to reduce usage of brokers and align with quality asset-based capacity. Our customers also generally have solid outlooks for their respective businesses in the near term, and discussions about peak season demand support have continued. With the tightening in market conditions, recruiting and retaining quality drivers have become more challenging. The constrained driver market is affecting over-the-road dedicated LTL and DRAGE markets to varying degrees. We believe we have an advantage with our terminal network, academies to source developed drivers, a diverse service offering. The truckload market is most affected, and we are making thoughtful targeted investments to aid our efforts starting in the third quarter, generally in the form of hiring and productivity incentives. We continue to closely monitor the driver market conditions, as well as our own metrics around seated tractors, utilization, and pay as a percentage of revenue to gauge appropriate actions as we balance the need to restore margins with opportunities for growth. We are encouraged by the momentum in the market and strong early progress in our core truckload business. We remain focused on increasing our seated truck percentage and optimizing yield. We are continually refining our cyclical playbook and have been preparing for this phase, which is typically a pivotal point. We have worked intentionally towards reducing costs, preparing to scale efficiently, investing in recruiting and training capacity, and driving collaboration and technology towards maximizing opportunities in order to enhance the contributions of our operational and market management strategies. And with the acquisitions over the past five years, we have a larger revenue base to work with than we have entering any prior upcycle. With that, I'll turn the call over to Andrew and Brad to review the results and our guidance.