Schneider’s third quarter was marked by a strong top-line performance but significant bottom-line weakness, triggering a notable negative market reaction. Management attributed the quarter’s underwhelming profitability to an unexpected $16 million increase in claims-related costs, primarily stemming from adverse developments on prior year insurance claims. CEO Mark Rourke described the freight environment as “sub-seasonal,” noting that initial strength in July faded through August and September due to softer volumes and retreating spot rates. He acknowledged, “The strength faded as the quarter progressed with August and September market trends largely sub-seasonal.”
Is now the time to buy SNDR? Find out in our full research report (it’s free for active Edge members).
Schneider (SNDR) Q3 CY2025 Highlights:
- Revenue: $1.45 billion vs analyst estimates of $1.43 billion (10.4% year-on-year growth, 1.4% beat)
- Adjusted EPS: $0.12 vs analyst expectations of $0.20 (41.3% miss)
- Adjusted EBITDA: $149.6 million vs analyst estimates of $165.9 million (10.3% margin, 9.8% miss)
- Operating Margin: 2.4%, in line with the same quarter last year
- Market Capitalization: $3.92 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Schneider’s Q3 Earnings Call
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Jordan Alliger (Goldman Sachs) asked if recent dedicated contract wins were Schneider-specific or industry-driven. CEO Mark Rourke replied that most wins were internal pipeline conversions, especially in specialty segments, with some ongoing friction from churn and new account ramp-ups.
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Thomas Wadewitz (UBS) questioned the mix of specialty versus standard equipment in Dedicated. Rourke and EVP Jim Filter confirmed that well over half of the dedicated book now skews toward specialty, with acquisitions accelerating this shift.
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Ravi Shanker (Morgan Stanley) probed how tightening supply is affecting 2026 rate negotiations. Rourke said early talks are underway and expects a more constructive environment for rate recovery, though most discussions remain in the strategy phase.
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Jonathan Chappell (Evercore) asked about lower revenue per intermodal load and strategic focus between volume and pricing. EVP Jim Filter explained flat pricing with growth driven by mix (more East/Mexico, less West), emphasizing intentional expansion in differentiated services over chasing low-yield volumes.
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J. Bruce Chan (Stifel) inquired about incremental tech-driven productivity beyond the $40 million cost target. Management cited double-digit productivity gains in logistics and “50% to 60% improvement” in certain AI-driven workflows, highlighting ongoing cost leverage opportunities.
Catalysts in Upcoming Quarters
In the coming quarters, we will be monitoring (1) the pace and scale of industry capacity rationalization resulting from regulatory enforcement and truck production trends, (2) progress on claims cost containment and the durability of recent productivity gains, and (3) sustained above-market volume growth in intermodal and the dedicated segment’s shift toward higher-margin specialty contracts. Advances in AI deployment and execution on structural cost savings will also be key to margin recovery.
Schneider currently trades at $22.37, down from $22.63 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free for active Edge members).
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