We use cookies to improve your experience, analyze site usage, and show relevant ads. Go to our Privacy Policy for details.
The call conveyed a constructive and cautiously optimistic tone. Ryder reported continued sequential and year-over-year earnings momentum (sixth consecutive quarter of comparable EPS growth), raised full-year EPS guidance, delivered record Supply Chain sales, and highlighted tangible progress from a $170 million strategic initiative program (on track for $70 million incremental benefit in 2026). Cash flow improved and the balance sheet remains within target leverage, supporting capital return and reinvestment. Offsetting items include ongoing segment-specific headwinds (Supply Chain EBT decline vs. a strong prior year, Dedicated revenue down 5%), mixed used-vehicle pricing trends (tractors up, trucks down year-over-year) and a still-depressed rental fleet limiting immediate cyclical upside. Management took a conservative stance on near-term cyclical benefits (only $10 million of upturn benefits included in 2026 guidance out of a potential $250 million opportunity), reflecting prudent guidance given macro and OEM uncertainty. Overall, positive operational and financial execution outweigh the present headwinds, with upside contingent on continued improvement in rental and used-vehicle markets and stabilization of end-market volumes.
Ryder raised its 2026 outlook, now guiding full‑year comparable EPS of $14.05–$14.80 (prior year $12.92), Q2 comparable EPS of $3.50–$3.75 (Q2 2025 $3.32), ROE of 17%–18% (unchanged) and free cash flow of $700–$800 million (unchanged); management expects $70 million of incremental benefits in 2026 from a $170 million multiyear program launched in 2024 (with $100 million realized through 2025) and ~ $10 million of upturn benefits in 2026 toward a potential ~$250 million peak opportunity. Capital guidance is lease capex of ~$1.9 billion, rental capex of ~$100 million and total 2026 capex of ~$2.4 billion (net capex ≈ $1.9 billion) with ~$500 million of expected used‑vehicle sale proceeds; rental fleet average is expected down ~11% and ending rental fleet down ~3%, with Q1 rental utilization 68% (66% prior year). Q1 operating revenue was $2.6 billion, Q1 comparable EPS $2.54 (+3%), Q1 free cash flow $273 million, used vehicle inventory ~9,500 units with 4,600 units sold in Q1, and Ryder projects ~ $10.5 billion of operating cash flow + used vehicle proceeds over three years that create ~ $3.5 billion incremental debt capacity (target leverage 2.5–3.0x, quarter‑end leverage ~269% / ~2.69x) and roughly $14 billion available for capital deployment (with ~ $4.5 billion, ≈60% of quarter‑end market cap, flexible for growth, buybacks and M&A).
Comparable EPS from continuing operations was $2.54 in Q1, up 3% year-over-year; company raised full-year 2026 comparable EPS guidance to $14.05–$14.80 (prior year $12.92) and Q2 guidance to $3.50–$3.75 (prior year $3.32).
Ryder delivered its sixth consecutive quarter of comparable EPS growth, demonstrating consistent execution of the transformed business model.
Supply Chain operating revenue increased 3% year-over-year and the segment reported record sales in Q1; Supply Chain EBT margin was 7% (at the segment's long-term target of high single digits) despite a difficult prior-year comparison.
Fleet Management Solutions EBT was $99 million in Q1 and FMS EBT as a percent of operating revenue improved to 7.9% year-over-year, driven by strategic pricing and maintenance initiatives.
Used tractor pricing increased 6% year-over-year; retail pricing was stable sequentially; first quarter used vehicle results were the strongest year-over-year since Q3 2022 and retail volumes outperformed expectations. The company sold 4,600 used vehicles in Q1 (up 1,000 sequentially).
Free cash flow increased to $273 million in Q1 from $259 million prior year (approx. +5.4%); management reiterated a free cash flow forecast of $700–$800 million for FY2026 and highlighted expected operating cash flow of ~$2.7 billion for 2026, reflecting improved contractual earnings.
Multiyear strategic program ($170 million total) launched in 2024 delivered $100 million of benefits through 2025; Ryder is on track to deliver the remaining $70 million incremental benefits in 2026, which management cites as a key driver of earnings improvement.
Q1 capital deployment included ~$400 million of funded lease/rental replacement CapEx and $272 million returned to shareholders (buybacks + dividends). Leverage at quarter end was ~2.69x (reported as 269%), within the target 2.5–3.0x range, and management cited ~$4.5 billion of flexible deployment capacity over a 3-year period.
Rental power fleet pricing was up 3% year-over-year and rental utilization averaged 68% in Q1 (vs. 66% prior year) despite a smaller average fleet (~13% smaller). Sequential seasonal rental patterns returned to historical norms for the first time in three years.
Management emphasized that over 90% of revenue is from long-term contracts and that the company has shifted toward asset-light supply chain and dedicated businesses, which are expected to generate ~60% of 2026 revenue vs. 44% in 2018, supporting higher ROE (forecast 17–18%) and stronger cash generation.
Good morning, and welcome to the Ryder System First Quarter 2026 Earnings Release Conference Call. [Operator Instructions] Today's call is being recorded. [Operator Instructions]. I would now like to introduce Ms. Calene Candela, Vice President, Investor Relations for Ryder. Ms. Candela, you may begin.
Thank you. Good morning, and welcome to Ryder's First Quarter 2026 Earnings Conference Call. I'd like to remind you that during this presentation, you'll hear some forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in economic, business, competitive, market, political and regulatory factors. More detailed information about these factors and a reconciliation of each non-GAAP financial measure to the nearest GAAP measure is contained in this morning's earnings release, earnings call presentation and in Ryder's filings with the Securities and Exchange Commission, which are available on Ryder's website. Presenting on today's call are John Diez, Chief Executive Officer; and Cristy Gallo-Aquino, Executive Vice President and Chief Financial Officer. Additionally, Tom Havens, President of Fleet Management Solutions; and Steve Sensing, President of Supply Chain Solutions and Dedicated Transportation Solutions, are on the call today and available for questions following the presentation.
At this time, I'll turn the call over to John.
Good...