ARCBEST CORP /DE/ (ARCB)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

​

General

​

ArcBest Corporation™ (together with its subsidiaries, the “Company,” “ArcBest®,” “we,” “us,” and “our”) is a multibillion-dollar integrated logistics company that leverages technology and a full suite of shipping and logistics solutions across multiple modes of transportation to meet customers’ supply chain needs. Our operations are conducted through two reportable operating segments: Asset-Based, which consists of ABF Freight System, Inc. and certain other subsidiaries (“ABF Freight”), and Asset-Light, which includes MoLo Solutions, LLC (“MoLo”), Panther Premium Logistics®, and certain other subsidiaries. References to the Company, including “we,” “us,” and “our,” in this Quarterly Report on Form 10-Q, are primarily to the Company and its subsidiaries on a consolidated basis.

​

Restructuring Plan

In July 2026, the Company announced a restructuring plan designed to realign our operating structure, reduce costs and simplify brand architecture through a series of organizational changes designed to create a more seamless customer experience and position the Company for long-term growth and profitability. Effective August 1, 2026, the MoLo® Panther® brands and certain other subsidiaries will operate under the ArcBest® brand. The series of organizational changes included the discontinuation of Vaux Freight Movement System, as the Company focuses Vaux operations on the Vaux Smart Autonomy product offering. During the second quarter of 2026, the Company recorded asset impairment charges of $25.7 million to write off the remaining carrying value of the indefinite-lived Panther trade name and $50.8 million in asset impairment charges related to the discontinuation of the Vaux Freight Movement System.

​

These actions also include a reduction of approximately 2% of total positions through workforce reductions and the elimination of certain open positions, as well as the proposed closure of ten ABF Freight service centers, which represent approximately 1% of our network doors. The consolidation of service centers constitutes a change of operations under our collective bargaining agreement (the “2023 ABF NMFA”) with the International Brotherhood of Teamsters (the “IBT”) and closure is subject to approval by the joint union-management Change of Operations Committee pursuant to the terms of the 2023 ABF NMFA. The Company evaluated the remaining restructuring actions for impairment and does not currently expect additional material impairment charges related to the restructuring plan. During the second quarter of 2026, the Company recorded $2.2 million of restructuring charges for severance and related costs included in operating expenses. The Company currently expects to record approximately $4.0 million of additional restructuring charges during the third quarter related to this restructuring plan. We expect these measures to improve operational efficiency and generate approximately $40.0 million in annualized run-rate cost savings while maintaining ArcBest’s commitment to premium service.

​

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

​

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided to assist readers in understanding our financial performance during the periods presented and significant trends which may impact our future performance, including the principal factors affecting our results of operations, liquidity and capital resources, and critical accounting policies. This discussion should be read in conjunction with the accompanying quarterly unaudited consolidated financial statements and the related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2025. Our 2025 Annual Report on Form 10-K includes additional information about significant accounting policies, practices, and the transactions that underlie our financial results, as well as a detailed discussion of the most significant risks and uncertainties to which our financial and operating results are subject.

​

22

Table of Contents

Results of Operations

​

Consolidated Results

​

The following table reflects the Company’s consolidated results, including segment revenues and operating income (loss):

​

​

Our consolidated revenues increased 15.9% for the three months ended June 30, 2026 and 9.8% for the six months ended June 30, 2026, compared to the same prior-year periods. The revenue increase is primarily attributable to higher fuel prices, improved market rates, and for our Asset-Light segment, higher shipment levels. Consolidated revenues for the three months ended June 30, 2026 were positively impacted by increases in Asset-Light revenues of 28.3% and Asset-Based revenues of 9.9%, compared to the same period of 2025. For the six months ended June 30, 2026, Asset-Light revenues increased 17.0% while Asset-Based revenues increased 5.8%, compared to the corresponding prior-year periods. Asset-Based billed revenue per day increased 9.3% for the three months ended June 30, 2026 and 6.1% for the six months ended June 30, 2026, primarily due to increases in billed revenue per hundredweight, including fuel surcharges, and weight per shipment in both periods of 2026 when compared to the same periods of 2025. The elimination of intersegment revenues reported in the “Other and eliminations” line of consolidated revenues increased 15.6% for the three-month period ended June 30, 2026 and 5.8% for the six-month period ended June 30, 2026, compared to the same periods of 2025, reflecting year-over-year changes in intersegment business levels among operating segments.

​

Asset-Based tonnage per day increased for the three and six months ended June 30, 2026, compared to the same periods of 2025, supported by higher weight per shipment. This tonnage growth occurred despite lower daily shipment volumes and ongoing uncertainty associated with geopolitical conflicts and tariff volatility. Billed revenue per hundredweight, including fuel surcharges, increased 4.2% for the three months ended June 30, 2026 and 0.3% for the six months ended June 30, 2026, compared to the same prior year periods. These increases were primarily driven by higher fuel surcharge revenue resulting from increased fuel prices during the three- and six-month periods ended June 30, 2026, partially offset by a shift in freight profile toward heavier shipments, which generally reduces billed revenue per hundredweight.

​

Higher shipment volumes and an increase in average revenue per shipment in our Asset-Light segment for the three and six months ended June 30, 2026, compared to the same prior-year periods, contributed to increased segment revenues. Improved rates associated with tightening capacity and higher fuel cost more than offset a higher mix of managed transportation business, which typically carries smaller shipment sizes and lower revenue per shipment. Our Asset-Light segment generated approximately 36% of total revenues before other revenues and intercompany eliminations for the three and six months ended June 30, 2026, compared to 32% and 34% for the same respective periods of 2025.

​

23

Table of Contents

Consolidated operating losses for both the three and six months ended June 30, 2026, compared to consolidated operating income for the same prior-year periods, were primarily due to asset impairment charges, as well as restructuring charges as discussed below. These charges were partially offset by higher revenues.

​

The Company recognized noncash asset impairment charges totaling $85.3 million during the second quarter of 2026, including $50.8 million related to the write-off of certain Freight Movement System assets associated with Vaux, $25.7 million to write off the remaining carrying value of the indefinite-lived Panther trade name as part of the strategic brand consolidation decision, and $8.8 million in lease-related impairment charges associated with the probable sublease of a portion of leased office space. Asset impairment charges reduced operating results by $85.3 million (pre-tax), or $64.2 million (after-tax), and $2.86 per diluted share for both the three and six months ended June 30, 2026. These asset impairment charges are further described within Notes B and C, to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

​

Restructuring charges, as previously described, reduced operating results by $2.2 million (pre-tax), or $1.6 million (after-tax), and $0.07 per diluted share for both the three and six months ended June 30, 2026.

​

Consolidated operating results benefited from the sale of a service center during the second quarter of 2026, which resulted in a gain of $2.9 million (pre-tax), or $2.2 million (after-tax) and $0.10 per diluted share for both the three and six months ended June 30, 2026.

​

During the second quarter of 2025, the Company reduced the contingent earnout consideration liability for the MoLo acquisition to zero as the earnout calculation did not meet the then-current projections which indicated that the adjusted earnings before interest, taxes, deprecia

[Excerpt truncated for page length; source filing is linked above.]

ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

​

ArcBest Corporation™ (together with its subsidiaries, the “Company,” “ArcBest®,” “we,” “us,” and “our”) is a multibillion‑dollar integrated logistics company that leverages technology and a full suite of solutions across multiple modes of transportation to meet our customers’ supply chain needs. Our operations are conducted through two reportable operating segments:

​

For more information, see additional segment descriptions in Part I, Item 1 (Business) and in Note M to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

​

On February 28, 2023, the Company sold FleetNet America, Inc. (“FleetNet”), a wholly owned subsidiary of the Company, for an aggregate adjusted cash purchase price of $100.9 million, including post-closing adjustments. Following the sale, FleetNet® was reported as discontinued operations. As such, historical results of FleetNet have been excluded from both continuing operations and segment results for all periods presented. Unless otherwise indicated, all amounts in this Annual Report on Form 10-K refer to continuing operations, including comparisons to the prior year.

​

ORGANIZATION OF INFORMATION

​

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided to assist readers in understanding our financial performance during the periods presented and significant trends which may impact our future performance, including the principal factors affecting our results of operations, liquidity and capital resources, and critical accounting policies. MD&A includes additional information about significant accounting policies, practices, and the transactions that underlie our financial results. This discussion should be read in conjunction with our consolidated financial statements and the related notes thereto included in Part II, Item 8 of this Annual Report on Form 10-K. MD&A includes forward-looking statements that are subject to risks and uncertainties. Actual results may differ materially from the statements made in this section due to a number of factors that are discussed in Part I (Forward-Looking Statements) and Part I, Item 1A (Risk Factors) of this Annual Report on Form 10-K. MD&A is comprised of the following:

​

​

35

Table of Contents

RESULTS OF OPERATIONS

​

This Results of Operations section of MD&A generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Annual Report on Form 10‑K can be found in the Results of Operations section of MD&A in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

​

Consolidated Results

​

​

Our consolidated revenues, which totaled $4.0 billion for 2025, decreased 4.0% compared to 2024. The revenue decline is primarily attributable to lower market rates and shipment levels for our Asset-Light shipping and logistics services in a soft market environment, which resulted in a decrease in Asset-Light revenues of 9.4%. Lower revenue per shipment, partially offset by higher shipment levels in our Asset-Based segment, resulted in a 0.6% decrease in Asset-Based revenues and contributed to the year-over-year decrease in consolidated revenues for 2025. The elimination of intersegment revenues reported within the “Other and eliminations” line of consolidated revenues increased 6.7% for 2025, compared to 2024, reflecting year-over-year changes in intersegment business levels among our operating segments.

​

Our Asset-Based billed revenue per hundredweight, including fuel surcharges, decreased 1.3% for 2025, compared to 2024. The decrease was driven by a shift in freight profile, including fewer shipments from existing customers in the manufacturing sector and the decrease in the fuel surcharge revenue associated with lower fuel prices. Tonnage per day increased 1.2% for 2025, compared to the prior year, supported by higher daily shipment volumes, despite a softer market environment driven in part by continued weakness in the manufacturing sector.

​

The decrease in revenues of our Asset-Light segment for 2025, compared to 2024, was impacted by a 7.4% decline in revenue per shipment associated with soft market conditions and changes in business mix, including a higher mix of managed transportation business, as well as a 1.8% decrease in shipments per day. Our Asset-Light segment generated approximately 34% and 36% of total revenues before other revenues and intercompany eliminations for 2025 and 2024, respectively.

​

36

Table of Contents

Consolidated operating income decreased $154.1 million year-over-year to an operating income of $90.3 million in 2025, reflecting the revenue decline, increases in Asset-Based segment salaries, wages and benefits; and the reduction in the contingent earnout consideration accrual during 2024, offset by lower purchased transportation costs and lower employee costs in the Asset-Light segment. Segment operating expenses are further described in the Asset-Based Segment Results and Asset-Light Segment Results sections of Results of Operations. In addition to the results of our operating segments, the year-over-year comparison of consolidated operating income was also impacted by items described in the following paragraphs.

​

Innovative technology costs impacted consolidated segment results during 2025 and 2024, including costs associated with our Vaux suite – Vaux Freight Movement System™, Vaux Smart Autonomy™, and Vaux Vision™. Certain costs related to Vaux and other initiatives to optimize performance through technological innovation are reported in the “Other and eliminations” line of consolidated operating income. These combined costs decreased consolidated results by $29.1 million (pre-tax), or $22.2 million (after-tax) and $0.97 per diluted share, for 2025, compared to $34.1 million (pre-tax), or $26.1 million (after-tax) and $1.10 per diluted share, for 2024.

​

The liability for contingent earnout consideration recorded for the MoLo® acquisition was remeasured at each quarterly reporting date, and any change in fair value as a result of the recurring assessments was recognized in operating income. Consolidated operating results increased by $2.7 million (pre-tax), or $2.0 million (after-tax) and $0.09 per diluted share for 2025 and b

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]