Ryder raises earnings outlook as freight market conditions improve

Ryder System reported higher earnings and revenue for the third quarter of 2026, supported by stronger performance in its fleet management and supply chain businesses, alongside improving conditions in the US freight transportation market.

The Miami-based logistics and transportation company recorded total revenue of $3.43 billion, an increase of 8% from $3.17 billion in the corresponding period of 2025. Operating revenue, a non-GAAP measure excluding fuel and subcontracted transportation revenue, increased by 6% to $2.76 billion.

Earnings from continuing operations reached $162 million, compared with $139 million a year earlier, while diluted earnings per share from continuing operations increased by 25% to $4.16. Comparable earnings per share rose by 21% to $4.33, reflecting higher earnings in Fleet Management Solutions and the impact of share repurchases.

The company also raised its full-year earnings outlook, citing the execution of strategic initiatives and improving performance in truck rental and used vehicle sales.

Fleet management benefits from improving market conditions

Ryder’s Fleet Management Solutions (FMS) segment generated third-quarter revenue of $1.62 billion, up 10% year-on-year, while operating revenue increased by 5% to $1.34 billion.

Segment earnings before taxes rose by 21% to $177 million, supported by contractual business performance, improved used vehicle sales and stronger rental activity. Earnings before taxes as a percentage of operating revenue increased to 13.2% from 11.4% a year earlier.

The company reported improving conditions in the used commercial vehicle market, with average selling prices for used tractors increasing by 19% compared with the third quarter of 2025. Used truck prices increased by 5% over the same period.

Rental fleet performance also strengthened. Utilisation of rental power units reached 77%, compared with 70% a year earlier, despite a 12% reduction in the average rental fleet.

According to Ryder, the results reflected improving freight market conditions and the benefits of its strategic initiatives.

“Ryder delivered double-digit earnings growth in the third quarter, marking our eighth consecutive quarter of earnings-per-share growth,” said John Diez, Chief Executive Officer of Ryder.

Diez said the company’s operating performance benefited from strategic initiatives and improving results in used vehicle sales and rental, while contractual sales activity remained strong across its businesses.

Supply chain growth offsets weaker dedicated transportation performance

Ryder’s Supply Chain Solutions (SCS) segment reported revenue of $1.50 billion, an increase of 9% from the previous year. Operating revenue also increased by 9% to $1.13 billion, supported by new business, higher volumes and pricing.

Segment earnings before taxes reached $91 million, compared with $86 million in the third quarter of 2025, representing an increase of 7%.

The company attributed the improvement partly to the optimisation of its omnichannel retail network and higher operating revenue. These benefits were partially offset by lower automotive results and productivity challenges associated with the ramp-up of new business.

Performance was more subdued in Dedicated Transportation Solutions (DTS), where total revenue increased by 6% to $606 million, largely reflecting higher fuel and subcontracted transportation costs passed through to customers.

However, operating revenue declined by 1% to $455 million, while segment earnings before taxes decreased by 5% to $34 million.

Ryder said the reduction in operating revenue reflected a smaller fleet, partially offset by higher pricing. Cost savings from strategic initiatives helped mitigate the impact on earnings.

Ryder increases rental investment and raises full-year guidance

Following the third-quarter results, Ryder raised its full-year 2026 comparable earnings per share forecast to a range of $14.85 to $15.05.

The company also increased its adjusted return on equity forecast to between 18% and 19%, while maintaining its expectation for operating revenue growth of approximately 3%.

Ryder plans to increase its full-year investment in the rental fleet to $500 million, representing a $300 million increase from its previous forecast. The additional investment is intended to position the business for higher anticipated rental demand in 2027.

The company maintained its full-year capital expenditure forecast at $2.4 billion and its free cash flow guidance at between $700 million and $800 million.

For the first nine months of 2026, Ryder generated approximately $2.0 billion in net cash from operating activities from continuing operations, compared with $1.8 billion in the corresponding period of 2025. Free cash flow, a non-GAAP measure, increased to $992 million from $496 million.

The company’s full-year GAAP earnings per share forecast stands at $9.75 to $9.95, reflecting approximately $4.30 per share in anticipated non-cash pension settlement charges related to the transfer of UK and Canadian defined benefit pension obligations to insurance companies.

Ryder’s updated outlook reflects management’s expectations for continued contractual business growth and further opportunities in truck rental and used vehicle sales, as the company prepares for anticipated freight market demand in 2027.