Ryder System, Inc. Q1 FY2026 earnings call

• Strategic update: Balanced growth strategy focused on operational excellence, customer-centric innovation, and profitable growth. Transformed business model with de-risking actions, multi-year lease pricing and maintenance cost savings initiatives. Port-to-door logistics offering provides end-to-end control. - Key financial and operating metrics improvement since 2018, with revenue mix shift towards supply chain and dedicated. - First quarter highlights: Sixth consecutive quarter of comparable EPS growth, better than expected used vehicle sales results in fleet management, supply chain generated record sales, improved contractual sales activity in fleet management and dedicated.

Total company operating revenue in the first quarter was $2.6 billion, in line with prior year. Comparable earnings per share from continuing operations were $2.54, up 3% from prior year. Return on equity was 17%. Free cash flow increased to $273 million. In Fleet Management Solutions, operating revenue was consistent with prior year, earnings before taxes were $99 million up. Used vehicle results showed year-over-year improvement. Rental demand remained below prior year but sequential seasonal decline was in line with historical trends, rental power fleet pricing up 3% year-over-year, utilization 68%. Used vehicle sales: year-over-year used tractor pricing increased 6% and truck pricing declined 5%, sequential pricing decreased, retail mix 61% in first quarter. In Supply Chain, operating revenue increased 3% driven by new business in omnichannel retail, earnings before taxes decreased 17% from prior year. In Dedicated, operating revenue decreased 5% due to lower fleet count, earnings before taxes below prior year.

• Increased full-year 2026 comparable EPS forecast to $14.05 to $14.80. - 2026 ROE forecast unchanged at 17% to 18%. - Free cash flow forecast $700 million to $800 million unchanged. - Second quarter comparable EPS forecast range $3.50 to $3.75. - 2026 earnings growth driven by incremental benefits from multi-year strategic initiatives, with potential $250 million benefit from cycle upturn, expecting ~$10 million up-term benefits in 2026 from higher used vehicle sales results.

Q: Nancy on for Ravi Shankar asks about what's keeping from unlocking more of the $250 million cycle opportunity.

A: John says first quarter had good used vehicle sales activity, retail volumes better than expected, UVS pricing stability sooner than expected. On rental side, no breakout performance in Q1.

Q: Jordan Alliger with Goldman Sachs asks about dedicated business pipeline and margins.

A: John says saw stronger sales activity, committed to longer-term contracts, dedicated margin expected to step up 200-300 basis points sequentially.

Q: Harrison Bauer with Susquehanna asks about demand commentary related to trucks/tractors in lease.

A: Tom says saw better pricing on tractor side retail, good demand across truck class in rental and lease.

Q: Rob Summon with Wells Fargo asks about contractual sales activity and fleet growth.

A: John says strong sales across all segments, existing customers awarding expansion business, fleet management and dedicated saw stronger sales than several years.

Q: Ben Moore with Citi asks about used vehicle sales trend and FMS contractual performance parse.

A: John says used vehicle gains expected to be about $10 million higher, FMS majority driven by strategic initiatives, 50-50 from price and maintenance.

Q: Scott Group with Wolf Research asks about progression from Q1 to Q2 and fuel impact.

A: John says all businesses expected to continue improving, fuel not meaningful part of story.

Q: Brian Ostenbeck with JP Morgan asks about SCS sales verticals and UVS outlook.

A: Steve says majority expansion with some new names, UVS guidance is modest improvement with higher pricing across tractors and trucks.

Q: Jeff Kaufman with Vertical Research Partners asks about confidence metrics and strategic shift to trucks.

A: John says saw truck utilization above 95% in broad market, contractual sales best in few years, redeployments and extensions up, lease power miles up. Shift to trucks more due to market environment, but well positioned to take advantage of secular trends.