Landstar System (LSTR) 26 Oct 232023 Q3 Earnings call transcript

Welcome to Landstar System, Inc.'s Third Quarter Earnings Release Conference Call. [Operator Instructions] Today's call is being recorded.

If you have any objections, you may disconnect at this time.

Joining us today from Landstar are James Gattoni, President and CEO; Jim Todd, Vice President and CFO; Joe Beacom, Vice President and Chief Safety and Operations Officer.

Now I would like to turn the call over to Mr. Gattoni. Jim begin. may you Sir,

you. Good Quarter Landstar's Third welcome morning, Conference Call. and Earnings to XXXX Thank

Before let the is during on a Reform we historical The of this safe statement. begin, Act forward-looking are harbor me conference read facts call statement not Statements are under XXXX. Private that Litigation following Securities made the based following statements.

other and by on time. may business Investors could nature and forward-looking for described of events my mention results in forward-looking year information to results or . Such from to filings risks Landstar's information. the make objectives, During risks, trends. forward-looking reliance differ anticipated. Landstar strategies not contain remarks, or information and to normal include, this the legal Form fiscal or no those to that time limited operational, subject that detailed . Throughout I of is conference undue actual SEC uncertainties Risk and to, XX-K section such or make These to will statements in normal Landstar's XXXX place call, concept financial expectations. patterns publicly cause plans, materially we update historical risks obligation and but the relates and the seasonal revise information, any undertakes not uncertainties should from Factors

pandemic-driven monthly due dynamics to For metrics XXXX excludes purpose for XXXX, of periods to in sequential highly quarterly to revenue, Landstar and refer historical count cycle. the my the unusual seasonal load or and our trends normal from XXXX remarks trends during or those today, from normal results freight pricing other XXXX, reflected patterns and XXXX

the of Landstar provided well billion issued within $X.XX the our soft of Actual environment earnings per XX, readily demand freight to We earnings revenue available ranges per ] in guidance $X.XXX the truck current arrived performed capacity, third and share of both second and revenue and the quarter release. guidance we [ July guidance quarter. share to billion with relatively $X.XX. earnings in $X.XXX XXXX Given

XXXX was the worth narrative was performance earnings to quarter freight the levels, in over third $X.XX and again, several third significantly is it and that exceeded billion the been by XXXX each U.S. Considering a XX%. XXXX as per has third share quarter continues quarters, that noting, approximately recession outpace quarter per revenue earnings XXXX pre-pandemic share for $X.XX. revenue

quarter, per XX% a in Overall quarter truck was load. XX% in revenue third revenue decrease the third decrease the XX% in $X.XXX a and volume on billion XXXX XXXX below load

facing with hauled As continued third the July comparisons truck actual we would we expected truck were Those normal July-truckload number both of end quarter on XXXX per quarter, the patterns. via early to per and based XXXX second seasonal below were trends via the seasonal through revenue normal July enter of the physical below and loads while difficult load revenue what be patterns. on from hauled year-over-year volume loads trending load financial truck

July to softening number sector. below been below manufacturing XXXX hauled as at seasonal beginning XXXX the via during that the The due truckload normal month-to-month of in sequential to patterns of and demand U.S. has June every from the followed trend loads the change normal pattern slowing and the count truck started almost consumer

month-to-month second XXXX contrast, third August normal of to September. and for better-than-normal been including quarter. seasonal been have the quarter X% volumes reflected once recently September, per Landstar's to inconsistent. have Xx, equal sequential seasonal in below have patterns normal approximately truckload decrease revenue an the average In August July during sequential from to patterns trends seasonal sequential very month-to-month Through and Xx, patterns truckload trends

below the volume quarter, patterns. July, the for August in Given normal to guidance third truckload a Landstar's perspective, historical to the truckload almost X% and quarter third in below in third the below quarter third June Moreover, the July impacted with was actual line volume XXXX consecutive the quarter third record seasonal still demand, set XXXX seasonal truckload XXXX. of softness September and quarter longer-term in behind volume second from truckload XXXX to normal however, change freight but trends. was best the each our quarter third well From pandemic were all-time only in XXXX count years August

from month-to-month even seasonal spot pricing project making atypical pricing perspective The difficult been has inconsistency to the term. it a in truckload in very near

June seasonal per patterns. from the normal to truckload August the July, and I Yet, trends were As August to truckload trends. during in revenue September than was per it truckload change change to per revenue mentioned both from as in to better the quarter revenue July relates month-to-month normal below earlier,

quarter pertains After Van over for comparisons comparatively the up more prior than challenging revenue equipment held breakdown quarter over it that platform equipment to hold unsided by The better services. year especially of on revenue per are and load. equipment transportation for via truck type, equipment platform other truck transportation as revenue much revenue van unsided

data van of on spike load industry up XX% pandemic-driven to greater from XXXX which And XX% per during in cost revenue environment. experienced XXXX February in revenue in on equipment than in of Atre truck in The to while low its to the in a freight a was its on-site XX%. trough May May XXXX, Based costs peak operate its load July point from ], approximately we also year fiscal consumer per XXXX, from in peak soft XXXX. demand excluding relatively XXXX drove [ its increased fuel

in which XXXX mile XX%, onsite above September bad XX% equipment and respectively, equipment on XXXX. September and surcharges excludes were per revenue BCO

earnings That relatively I due As as I room cost per end and conference second the of I revenue September. higher BCO significant to amount the that the mile operate call looking decreases our quarter today. through true relatively rates on additional for July of during has than mentioned forward, these little truck held pressures. held expectation unsided spot on a given market in XX, and expect pre-pandemic levels stay the equipment market held stable summer cost to platform will over believe the spot

air same although and the the non-truck XX% in an non-truck rail, ocean third revenue below easier when we a The with was and significant in below XX% quarter Total XXXX comparing the decrease year-over-year quarter. expectations the XXXX experienced quarter, XXXX decrease third the of of comparison. percentage were to modes XXXX ocean decrease third on XXXX Our per loadings transportation in in quarter. shipment. revenue the The second our third second quarter XXXX or volumes in the all line quarter million $XXX significant were across lower expectation services

is by load customer Total volume influenced somewhat mix.

vary widely For was to where in and period-to-period XPLs truck XX% changes companies, capacity transportation of in trucking quarters, other and with of XX% more XXXX example, levels the the truck Landstar freight truck brokers, of Revenue transportation XXXX companies tend other revenue to hauled demand. behalf volumes provides respectively. on and third

truck on The capacity, loads hauled and by year the quarter XX% third tight out capacity significantly over the our of reach freight provide of companies, number third other trucking in on brokers the truck truck readily during was volume. prior includes in to periods behalf Landstar XXXX almost truck quarter, truck haul XPLs below quarter, transportation behalf companies more decrease quarter available the transportation of Overall, capacity. Landstar to XX% other times than During network more XXXX all companies commodity of of other the groups. contributing often

third BCO XXXX decreased since approximately quarter. quarter, the the by the BCO XX% During truck truck count end trucks. of XXX Overall, decreased count has

XX-month not to turnover performance. XXXX to rolling does increase period I turnover unusual end There comparable driving cost quarter seem a reduction relatively pass slightly third will recent rate be significance in comment of to rates turnover truck average the at the XX% comparable environment. which the recent pre-pandemic is Jim to Landstar truck third in as increased the decrease the on experienced believe was P&L XXXX now the the XXXX BCO soft rate due regarding and the to an during rate the I Todd than count. additional in quarter metrics the operate of factors higher in compared most the to to XXXX periods. other compared today was XX%,

has our various Gross other quarter, in press the third $XXX.X quarter. quarter, profit quarter margin as included profit gross I of third financial million X.X% third the XXXX. period XXXX variable in $XXX.X third cover profit XXXX third to in information million In corresponding the third compared Jim was was quarter, XXXX will compared Thanks, XX.X% the G XXXX quarter. XXXX, compared so to million million revenue gross in $XXX.X XXXX to quarter contribution of on Jim. information in gross certain third $XXX.X release. covered In the of was profit of

trailing provision last third independent $XX.X revenue costs costs revenue to quarter increased contribution the were was and transportation. as of by $XX.X variable used the other third truck XXXX than than in carriers points generated period attributable margin percentage in basis by million gains mix XXXX. an paid was margin due the XX.X% for as in compared third primarily claims was carriers XX . Other modes to contribution the increased contractor to offset rate to: the was quarter. Variable of quarter two, equipment. $XX.X the was which primarily to generated has XXXX XX.X% brokerage on in third revenue were to XXXX the trailing revenue paid million partially year. The of XXXX. debt increased in XXXX increased compared quarter Insurance typically contribution BCO and margin to XXXX million one, sale higher by generated a equipment This variable third operating in lower in quarter in contribution in variable by $XX.X increase truck costs quarter of increased rate contractors an And compared an margin million on compared maintenance the the brokerage third XXXX bad increase same

claim during by partially and primarily insurance cargo offset Van in to in to attributable the accidents compared of miles and in XXXX severity a costs decrease decreased decrease period the increased costs. The XXXX XXXX a traveled BCO as was period,

attributable However, insurance in increase and point XXXX entirely claims XX the in were in loan. was The X.X% and the decrease BCO basis costs insurance BCO XXXX BCO claims period revenue BCO total as period. revenue to revenue cost of of and XX% in almost percentage revenue of per a the X%

cash million third $XX.X technology and under programs million primarily a variable for equity third in XXXX million on $XX.X Depreciation in and $X.X was to decrease costs decreased offset costs use in the million from to partially third XXXX. company's programs, Selling, and general upgraded attributable under by in administrative quarter, the company's capacity. resulting costs partially compared $XX.X compared quarter on to tools employee depreciation for was and the and general XXXX in compared The In agents were was and selling, XXXX. the due benefit decrease the $XX applications in administrative third decreased increased million offset This increased by $X.X software provision XXXX new in fleet, quarter. quarter compensation incentive depreciation XXXX amortization for the to costs. increased continued was provision million and compensation trailer investment information the to by

income rate third the was XXXX in quarters. XXXX [ XX.X% effective The both tax and ]

to were and Looking Cash million, at was $XX X and first from expenditures our Jim. flow short-term Back we cash cash capital the with ended quarter XXXX million. for $XXX million. $XXX investments balance of of months operations you, sheet, the

We overall we've throughout much experienced in compared the fourth thus to what don't XXXX. quarter to expect far XXXX freight economy the change

this earnings Directionally, volume Yesterday to also forecast remainder the expected We very anticipate of is the transportation lower remain freight sequentially season cap patterns. muted economic continue was compared demand early drive Overall, trending XXXX year. it may beyond as is to October-truckload a few are note levels and months relatively truckload release monthly XXXX. peak historical significantly that conditions volume future to below difficult truckload next soft unpredictable. XXXX, for for to

the we expect the truckload volume, Given beginning quarter the below volume the from fourth of seasonal XXXX XXXX to experienced the truckload fourth in third quarter, had quarter to start normal we at trend lower patterns.

week how our XXXX the calendar to fiscal quarter. quarter due Additionally, operating XXXX year works, the less X fourth fourth than has

XXXX to XX% remain XXXX quarter-to-quarter quarter. is fourth cap quarter XX% we expect the to at Given truckload seasonal to below forecast normal below be trends, fourth

third volume quarter quarter. Excluding XXXX in from the third in truckload the expected XXXX fourth the operations quarter XXXX fourth slightly fourth similar truckload decrease our quarter XXXX the to quarter compared to of XXXX extra is be to the the worse in week cap, than the to performance compared

XXXX line fourth normal truckload slightly X% ahead the expect in seasonal patterns. We XXXX quarter quarter, to pricing X% to of below fourth be to seasonally

similar of nontruck the revenue to We quarter. XXXX to be our from third most also expect that

XXXX the assumptions be to of billion of fourth open margin in revenue. insurance to fourth earnings to approximate of $X.XX to billion The we contribution expect XX.X% in the on XXXX quarter Based will quarter $X.XXX to revenue $X.XX. per range a in to be questions. mentioned, range and share the forecasted and claim to BCO that, we and of with X.X% guidance XX.X% incorporates variable costs And $X.XXX

[Operator much, At you of first Instructions] Research. will Wolfe Thank begin session. Scott question very And Group we from of the coming we the sir. time, have the this question-and-answer line

a little to So bit better. I want try volume the understand and situation

XX% lower they your look QX you in guidance to volumes about If are at QX. than were going be for

grow, the your a hard of typically X%, end this continued What's strike? the -- that understand underperformance count causing you of is volume? What the on sort with to is I the know, do to -- seasonality of historically, something such the just the really freight they something go You think falling beginning or it Is about -- so keeps don't is this it's from auto environment XX% year. is model this BCO sharply? back

The touch I relates variability as trucking other volume in thing haul the companies. the our to on model only it is we XPLs for would and

my tight hard remarks, find is in it's and truck described capacity I As when really capacity. to

trucks Our on very agents good are at putting loads.

us to in frequently tight a truck other XPLs the they environment companies out do. so the brokers reach more other and And and

So been year just since look a it's just negative. model when it's environment. that, it's be on than that soft the going March, you Other -- in manufacturing would what's differentiator. the I been at all U.S., in

coming is -- that the our . I I think of to volume. truckload side. down, underperformance to that normal there. to point. clearly demand would October sequential October, to from the feels due not the so at trend relates to economic I specific on September it. this from -- other It's much October. So there's say, we below it don't that's than entirely But but actually contributing is shutting just don't that mentioned But to have I anything as is think September of that, the to model also just seasonal Part demand it automotive seasonal plants some pretty had it's

year-over-year? do Okay. to and And are hard to you you that expect in it's you about for predict. then Is you probably that to a grow would I think earnings you know. shot But per hard have when know revenue Do -- load too could that? rates start inflecting How thinking higher XXXX? think

spot. hired if look contracts -- rates, gap you -- going is But it's rates the the spread, right could the between demand maybe that's and at in pick now, drive looks between doesn't $X.XX spot drive the to Well what only being like contract spread thing up, right?

world contract look of would year, kind market yet. transitions that advantage I the we're that really spot gap tightened of but rate. our it's heavy much in seen as of discount shippers at the start happen and little much -- since that to as taking has a not So bit, expect. if . And eventually, you Haven't the spot

turn. X that So to this we've hard gap it's kind months for will of sitting predict like when on been

the But see it's shippers a where happen. market don't going flat, back relatively a get the stays bit demand start spot that Assuming to coming of I into turn little to discount.

little late I'm quarter, part of here, today. hoping My more second sitting at in X, I instead end might cycle. next expectation inflection cycle the gap. of of more fourth short in maybe We for the that the on our pessimistic cycle looking maybe XXXX, now prediction it a But I the haven't the yet. think the early I'm a to said be puts year. us which of the is is we're quarter, summer X-quarter the seen happen that's normal is

And risk normal further from And there's thing still just mind? do to gap above quick contract just with think to in What's $X.XX clarify, for contracts one here? just your you that spot. --

I think a the a mile. very that's per number, $X.XX revenue $X on large

as a shippers scared So gap is. to I'm with because is same be They contract the been it's like honest consistency And other in it that contract rates. the down shipper's of market. playing little are holding to thing a you, time. the large that in that, Maybe as mind, good the surprised start rates, the contract the at have coming the looks rates spot

deal they're So their XX I'm was looking months than history, it getting at better hey, a thinking ago. today

when. the little to it take delay shift I'm going is the longer. to might to know more the back a me peak why it's X Scott, in be going right to make little line contract, you toward the opposed of this might and the X a to might trough hesitant to think quarters longer I of say more cycles, delayed to don't to going back just is be So be trough short to end Right cycle I as cycle, now peak it's quarters. now, where a the believer in typical I'm which it's true in be going

question coming have We from next Seidl TD Cowen. Jason of the

to spot. and between gap going contract Jim, $X.XX back that

that about it's is said for months. last you've the on that there held You something long X seen a When in hold time cycle?

months think X unusual. that I is don't

about spot market do. shippers not jump sitting apart XX-month last or before months, could spot -- that XX even mean that of fact it and the when a it's I think it's contract is think the move far not all tight, the they on that indication. much if directionally the it, you contracts, versus is more I seeing in are we're more of they if right,

because like gap seems this it historically. a historical it's little a me, I don't to there's had perspective have So than we've -- a good larger

there again, was a then was I'm by And that I'll that back. it Like by kind pulled gap, hasn't as the say, That XXXX, disrupted pandemic. pandemic. surprised clearly, but cycle little a of was disrupted the

when look the these same So it's At shorter-term the was back when was to production cleaning because the back -- you where ELD, getting were industrial implemented. XXXX, run-up a up. look had so it the massive hard time, at right, we

cycle. that that disrupted So

that hard I it's there's in the cycles years, when and So look to a at been of X really or a back lot X trend. disruptions look so as

All terms the fourth about talked seasonality, a a the a right. a of coming normal little expectations and in of quarter And bit was in so out of you muted think, finally should That little season starting to see line. you're we conclude peak auto strike, pricing I bit sense. bit With makes little above that your capacity an marketplace?

What for We we the aren't read us seeing not that. We're come the capacity read of what to kind dropping. is rates acceptance to hard load truck and of measure seeing bankruptcies out marketplace. shutting you down. covers about It's

of doesn't market is capacity out the we're coming stats coming the of that Some a the we looking of yet. out. capacity significant about hearing are show it But at, amount

BCO impact of equation just don't count, now, being capacity. our just significant out available but needle more And it's and right the I right, on coming there's the turning had at start a level supply supply-demand things on expensive. believe look down that the metric, that capacity Clearly, to demand. XX% because are I

type to dry Or going year-end to now talking see are come of maybe sort the any here one on inflection. expectations the your My to followed they're and about assume think then do of that roll together. out you're summer side platform? on first Should we inflection of by you van is the will final pushed XXXX your

more and different consumer U.S. is completely dynamics, more like is One type X manufacturing machinery stuff One driven. right? Well, that.

really there. that drive volume consumer would my consumer the and -- heck a down. up be side, There's there's it's within a the that on I say can of would more -- or van volume So the expectation side U.S. more lot

van and lot to They're market in the And is flat chug that The spikes of capacity. ups downs a kind of comes and guys having of out used capacity bit environment. the the along.

I think that say watching it more on van the be would I'd I So side.

-- flatbed. the The it about as -- you thing lot to whether diverse. the right, industry we're It's flatbed too lumber? is the Is on side. other markets is haul side a delivering relatively Is doing or flatbed of doing inconsistent, and opposed are what The it we're regular what kind heavy end consumer. more

cycle. travels more bit . actually that a has a consistency little got So different little the Van van. than in

We of the from have Atkins the Jack question Stephens. of coming next line

So I a wanted go back I for guidance to guess, the minute. to Jim,

Just point in you're And Or I performance saying decoupling it. of clear mean contract if are quarter of to spot? guess, trends earlier that this line but fourth kind per think have revenue load I around normal fourth going got more so the I volumes in quarter, a are revenue the per if fairly based do I so of volume correctly, the much be significantly quarter, is we've subseasonal "seasonality" the understand there we're weighted versus thought typical understanding in seasonality. is kind load what of -- we're with subseasonal, the at wouldn't the commentary later on subseasonal, to subseasonal? that think you

more of out seeing favorable It's as X October. weeks on jumping the little what's into relatively look quarter October. a third all We're first based from

So So October really out, is think the yet a and be That's because take where heading that it's quarter. jump-up trended the we're just at sequentially will number there. better we're if carrying than quarter that got you expected, October we seasonally, point -- right? over how starting forward will be coming higher we so into

Jim, in like or margin guide? sense. within G&A gross the maybe assuming Okay. and you're you for that. maybe I revenue moment. just thought net got can follow-up Makes you, the a in All for guide but terms give us just But Maybe is a this a that Todd, on margin fourth right. maybe quick the of the on quarter

Jeff. Yes,

mix. and is at guy step the midpoint good on revenue, VC majority So the for looking XX.X% the given assumed the there we're to down of XX.X% at

X.X% for sequentially. quarter. On G&A utilizing fairly the of your being But are consistent, there in a versus we're X.X% pretty course, -- stable third guide side, the actual insurance lines the other

I difficulties, Jim as to has one so Great. higher Gattoni, love I'd first that's far. with to going call brokerage had longer of you we've Okay. closed. a seeing higher of I you're logistics what last lot picture, affect your weeks provider cost bigger term get term, market, are landscape maybe some competitors guess, more and last couple of which you here, or truck the guess How term kind guys evolving around not shorter broker thoughts And And news here question I maybe of report but competitive in some within would your financial high just but capital? interest the of on to how of the flying the longer facing maybe landscape the term? think do longer rates year either

the -- in results, take right? really and a us, ones the model a talking stores of about that doors. X in believe was or and brokerage temporarily economy capital at at I that business we than model. our really asset to economy the that least we look think going affected light it that's of its rates for Cost way asset So business you're interest is light it affects demand the us and where shut how financial the at shut Well, affects model has more more

scenario we've It's what business digital don't matching the know were fourth the closed. I where anything looking look, us. The the -- preaching for been couple be are from delivery, shippers build freight look, it. the freight -- last on I'm did high-quality it's isn't service, to didn't going We X change. not got see We happened execute way they app, shut just when their And they for was brokers, for the on-time it's of model long or to build in with tools service years. technology that we've like a We digital going freight can into that coming you The XXXX. long said working. over. the sure the term, I've couple -- just with some that's of quarter. loads But doors. a always been anybody to brokerage, since we executing or term There an one X

drivers posting where up, of on boards some the we've So are been website the sitting right? were and We spouses to calling home that.

but behind a I viable the factor business think it. human you there's when it digital, think there need out to I comes

So that to it's we that we broker against into us, human geographically than competitor factor field just we those with compete the space the the better another think dispersed start-ups U.S.. throughout anybody have

Long don't much. industry changing see I term, this

systems speed build your sharing data, communication the like efficiencies around that. talk back-office or AI, accurate -- we flow, visibility. -- it paid AI It's what that. to and information point that is point by do improving stuff your You the of B, stuff and freight like from what about we A get do to That's what move And is, it's right? whether

don't the significant to don't side, see works the on relates So that. as broker forward technology I change when cycle, it cycle truck going a brokers or way see I the disrupting anything the out.

next Jefferies. Stephanie coming have We from the Moore of question

again bit the maybe coming touch count on continuing I in the down, little wanted quarter. third a BCO to

we're context, to think -- love do if then could here. know think BCO into take you and of And for of some wanted I maybe we're a further? at October. provide color bottom utilization in signaling a at bit maybe your leg of little in kind kind on quarter the Do just this remarks. just third And if maybe that -- low we how I little here? think of a kind the touch you to But down kind you could it is about multiyear trended prepared you commentary has bit a provided you of

Great. Thanks, Stephanie. Yes.

that here economic we've would think the turnover stays we are last we've the of as that are downturn So this and think some the demand down. backdrop that correct. I where BCO to been quarter. decline down count, as down and would for would result see I seen the about way minutes. rates fourth in of elevated I the I is, talking that is anticipate some the it mean you're volumes few really think long duration I continue

the about the range. X range likely versus quarter talking a quarter we're X recovery And more in

So that's early into seen last next first year, XX the it's kind a quarters, pretty us. say. for of hard X to decline, we've typical of

is we're a right? look think then small the pretty 'XX, up trucks, So the I 'XX more. of and up until has about if of count, drop, that years, I from the went result demand our next back, where we're over think as the trucks been we a pandemic at declining 'XX, But just X,XXX volatile of the and because X,XXX you BCO 'XX really were or bottom through account BCO couple In don't quarter the took economy there. we and and In we first a is.

the does with it economic backdrop. move So pretty quickly

So do while I months, coming the I continue turns. to we bounce think see some this thing will back in when declines

a second were third standpoint, in quarter. quarter. we were up year-over-year we in from the but X% X% then were in down utilization And the We down X% the quarter, first

were So -- in and up X% July, X% quarter, and we August down up in in the X% September. in

there So utilization. some improved is

coming has difficult. we for a for didn't do the ultimately, kind their lot as out that really analytics them, take surprises this the can business the we environment sure of it as BCO they got here we've to been rapidly And decline They but equation came. see tools understand I so better. to think make try the of

But duration. think it's the really, I

the else the for BCOs most of a back that they're later think But I -- time. some those think, But something had not of viability an and business duration opportunity some withstand impact lasts get of think of us. period do or a to ads some can decline I has that's for are perhaps, this one, this cases, come maybe BCOs -- out of on a the the the of -- time. either and kind in issue taking I

think itself that of sidelines of into sit just the some those the on lot here, actually fleet to coming until I fairly decision strong. Our additions this stuff It's are are out. have making keeping been works the a them and

what know muted Can your I a give fourth season hearing me. season? indication maybe your guidance then an pretty assumes And Got you peak peak customers for it. in around quarter. you're from just the second

the pretty fourth they're mean quarter. the XX% XX% into they quarter, down being or just talking is compared to down. volumes year's -- Volumes I significant expectation fourth coming prior

peak the season. -- They're about band with where my the carrier, but mean said, of line saying -- had as side, do the conversations side, giving parcel have not the the not that substitute us haul, but the on -- we it's talking a flatbed customers. field metrics, . just specifically exact You're some expect doesn't the they based necessarily dynamic not guys we it's

[Operator Instructions] next At this time, Chan we have from of Bruce line questioner Stifel. the of the

this Cox of to Hunt your wanted I on just kind for morning. if there, for any with wanted Bruce overlap Logistics. I BNSF acquisition is This to there know any get Andrew on compete Landstar J.B. the commentary of agents, commentary? they is

see name pressure any of of stuff, existed We've exists different that as kind it it Yes. expect that we any see existed on we its seen don't form that or in didn't J.B. to BNSF would when moving Logistics pressure Hunt. from -- prior and under a any when no

to anything answer the BNSF the be at with to either this legacy existing to from So when it's haven't going J.B. transfer Hunt. brokerage seen point, we that would

on I'm size, to wanted stand next Okay. update I haven't Great. trailer heard and today. And in age the year? you just into any another the potential fleet we get where there call headed CapEx one, on an terms thinking of requirements about

you a Joe. shot due if of fleet or during is to is really take know, And our this at held know under I'll some to don't there on out. as we're to inability and trailers older the trailer The just pandemic, some you currently. of we the Andrew, may in XX,XXX that years of couple a equipment, the acquire that. new process cycling for of

increased talked Some that what is earlier attributed what's to with of Todd costs. about Jim the maintenance

for pulling every in of trying and north We drop little market, the BCO vans in typically the that. a of So we're fleet we're have ban process trailers now. rightsize hook and to X the

trying count the saw quarter. point. again, which intent some BCO pretty some into to get equipment some . watching But rightsize forward, sales, we're XXXX looking you in is to through And at new So carefully. that maybe the in then

to would back At over questions. like this remarks. sir, time, show closing I no turn further for I call the you, to

EPS going with ran everybody guess Well, close but I'm call, to regardless. I the a would that to statement

the peak picture to typical we ordinary additional a or Generally, close, revenue where drive that to market I down X big up dynamics over that X the briefly we are want in that peak. as market I revenue cycle occurs cycle provide freight today. results. course trough from Landstar's Before both cycle years, experienced In cycles of for well past peak drive freight to discuss this the year's trough quarters. to stage from spot X context business, of period ultimately cases, to to to the through performance set cycles trough trough from over to the freight peak as revenue spot occurred

for the driven and pricing cycles contract time differential between in these the the industry point and level factors: typically industry-wide spot And X main of demand services, freight during given by are truck at level capacity cycle. industry available any of the

other of on Landstar's back down Since the quarterly experienced XXXX recent thus and XXXX may imports. overall has interest the part exactly each quarter. consumer up-cycle cycle, begin factors the be decreased Due the second the to second overseas disruptions revenue political of X make over quarters. quarter, will far U.S., and spending, the peak following to quarterly over to revenue expect cycle repayments the geopolitical Landstar's revenue loan current predict the conflicts, in revenue end the down labor ago during and quarters a it when in peak a cycle cycle quarterly economic delayed latter typical the start quarter the many environment, the cycle. of uncertainties rates, in student Looking towards . Recent down which impact hitting increasing occurred will X I difficult

in variable through Landstar's experienced even our XXXX, in Nevertheless, industry freight have returns. with generate the continued that to along challenges others environment many we, the solid with cost business has model

our Our We focused balance stronger. business control. on been can elements remain sheet never that the we has of

capacity for to Thank fourth providers forward agents' success. February with speaking your again improvements continue to on and for in and tools, day. earnings you you, empower continued digital invest to X. quarter look our people process XXXX conference scheduled I call Enjoy We

morning. joining Thank conference Have you your good for today. disconnect Please the time. call a lines at this