Werner Enterprises sees cost headwinds lingering into Q1
Werner Enterprises outlined a path back to mid-cycle margins on a Tuesday evening call, but noted cost headwinds—some transitory and some growth-related—could linger into the first quarter.
Executives from Werner Enterprises outlined a path to double-digit truckload margins, but said cost headwinds will likely limit progress over the next two quarters.
Werner (NASDAQ: WERN) reported third-quarter adjusted earnings per share of 16 cents after the market closed on Tuesday. The result was in line with a profit warning issued earlier in the month, calling for adjusted EPS of 15 to 16 cents versus the 36-cent consensus estimate at the time.
Consolidated revenue of $951 million was 23% higher year over year and at the top end of management’s revised outlook ($946 million to $951 million). The increase was largely due to higher fuel surcharges and the January acquisition of dedicated carrier FirstFleet.
Sequential cost increases from elevated diesel fuel prices, higher driver procurement expenses and a reserve adjustment for prior claims were an 18-cent EPS drag on the third quarter. Gains on asset sales increased y/y from $4.5 million to $8 million, providing a 4-cent tailwind. (The company booked an adjusted net loss of 3 cents per share in the 2025 third quarter.)
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