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LANDSTAR SYSTEM INC

LANDSTAR SYSTEM INCLSTREarnings & Financial Report

Nasdaq · transport

Landstar System, Inc. is an American transportation services company specializing in logistics and, more specifically, third-party logistics. Landstar utilizes an extensive network of over 8,800 independent owner-operators, referred to internally as business capacity owners (BCOs), over 1,000 independent freight agents, and over 70,000 vetted carriers. Landstar provides services principally throughout the United States and to a lesser extent in Canada and between the U.S. and Canada, Mexico, ...

What changed in LANDSTAR SYSTEM INC's 10-K — 2024 vs 2025

Top changes in LANDSTAR SYSTEM INC's 2025 10-K

332 paragraphs added · 248 removed · 213 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

65 edited+34 added−9 removed65 unchanged
Examples of the industries serviced by the transportation logistics segment include automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics and military equipment and general commodities. In addition, the transportation logistics segment provides transportation services to other transportation companies, including third party logistics and less-than-truckload service providers.
Examples of the industries serviced by the transportation logistics segment include automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics, military equipment and general commodities. In addition, the transportation logistics segment provides transportation services to other transportation companies, including third party logistics and less-than-truckload service providers.
Landstar’s training and development department offers all employees the opportunity to participate in various learning tracks on topics including Leadership, Workplace Safety & Security, Customer Service and other core skills. Courses offered by the training and development department are delivered by Landstar’s team of Association for Talent Development (ATD) certified trainers through both on-line and classroom settings.
Landstar’s learning and development department offers all employees the opportunity to participate in various learning tracks on topics including Leadership, Workplace Safety & Security, Customer Service and other core skills. Courses offered by the learning and development department are delivered by Landstar’s team of Association for Talent Development (ATD) certified trainers through both on-line and classroom settings.
Management believes the factors that have historically favorably impacted turnover include the Company’s extensive agent network, the quantity and quality of available freight, the proprietary technology-based tools the Company makes available to BCO Independent Contractors to empower them to manage their businesses, the Company’s programs to reduce the operating costs of its BCO Independent Contractors and Landstar’s reputation for quality, safety, service, reliability and financial strength.
Management believes the factors that have historically favorably impacted turnover include the Company’s extensive agent network, the quantity and quality of available freight, the proprietary technology-based tools the Company makes available to BCO Independent Contractors to empower them to manage their businesses, the Company’s programs to reduce the operating costs of its BCO Independent Contractors and Landstar’s reputation for quality, safety, cargo security, service, reliability and financial strength.
Through this network of agents and capacity providers linked together by Landstar’s ecosystem of digital technologies, Landstar operates an integrated transportation management solutions business primarily throughout North America with revenue of $4.8 billion during the most recently completed fiscal year. The Company reports the results of two operating segments: the transportation logistics segment and the insurance segment.
Through this network of agents and capacity providers linked together by Landstar’s ecosystem of digital technologies, Landstar operates an integrated transportation management solutions business primarily throughout North America with revenue of $4.7 billion during the most recently completed fiscal year. The Company reports the results of two operating segments: the transportation logistics segment and the insurance segment.
In addition, the Company utilizes several third party data centers throughout the U.S. Landstar relies, in the regular course of its business, on the proper operation of its information technology systems. 8 Table of Contents Corporate Services The Company provides many administrative support services to its network of independent commission sales agents, third party capacity providers and customers.
In addition, the Company utilizes several third party data centers throughout the U.S. Landstar relies, in the regular course of its business, on the proper operation of its information technology systems. 9 Table of Contents Corporate Services The Company provides many administrative support services to its network of independent commission sales agents, third party capacity providers and customers.
The Company’s top 100 customers accounted for approximately 46% of consolidated revenue during both fiscal years 2024 and 2023. Management believes that the Company’s overall size, ecosystem of digital technologies and applications, geographic coverage, access to equipment and diverse service capability offer the Company significant competitive marketing and operating advantages.
The Company’s top 100 customers accounted for approximately 46% of consolidated revenue during both fiscal years 2025 and 2024. Management believes that the Company’s overall size, ecosystem of digital technologies and applications, geographic coverage, access to equipment and diverse service capability offer the Company significant competitive marketing and operating advantages.
The transportation logistics segment’s rail intermodal service capabilities include trailer on flat car, container on flat car, box car and railcar. The transportation logistics segment’s rail intermodal services contributed 2% of consolidated revenue in each of fiscal years 2024, 2023 and 2022. Air and Ocean Services.
The transportation logistics segment’s rail intermodal service capabilities include trailer on flat car, container on flat car, box car and railcar. The transportation logistics segment’s rail intermodal services contributed 2% of consolidated revenue in each of fiscal years 2025, 2024 and 2023. Air and Ocean Services.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past decade, there has been a significant increase in the prevalence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past fifteen years, there has been a significant increase in the prevalence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
Moreover, the Company from year to year manages the level of its financial exposure to commercial trucking claims in excess of $10 million, including through the use of additional self-insurance, deductibles, aggregate loss limits, quota shares and other arrangements with third party insurance companies, based on the availability of coverage within certain excess insurance coverage layers and estimated cost differentials between proposed premiums from third party insurance companies and historical and 9 Table of Contents actuarially projected losses experienced by the Company at various levels of excess insurance coverage.
Moreover, the Company from year to year manages the level of its financial exposure to commercial trucking claims in excess of $10 million, including through the use of additional self-insurance, deductibles, aggregate loss limits, quota shares and other structured arrangements with third party insurance companies, based on the availability of coverage within certain excess insurance coverage layers and estimated cost differentials between proposed premiums from third party insurance companies and historical and actuarially projected losses experienced by the Company at various levels of excess insurance coverage.
The transportation logistics segment’s air and ocean services contributed 6% of consolidated revenue in fiscal year 2024, 5% of consolidated revenue in fiscal year 2023 and 8% of consolidated revenue in fiscal year 2022. Insurance Segment The insurance segment is comprised of Signature Insurance Company (“Signature”), a wholly owned offshore insurance subsidiary, and Risk Management Claim Services, Inc. (“RMCS”).
The transportation logistics segment’s air and ocean services contributed 5% of consolidated revenue in fiscal year 2025, 6% of consolidated revenue in fiscal year 2024 and 5% of consolidated revenue in fiscal year 2023. Insurance Segment The insurance segment is comprised of Signature Insurance Company (“Signature”), a wholly owned offshore insurance subsidiary, and Risk Management Claim Services, Inc. (“RMCS”).
A significant portion of the Company’s truckload services is priced in the spot market and delivered over irregular or non-repetitive routes, while approximately 25% of the Company’s fiscal year 2024 truck transportation revenue was generated by BCO Independent Contractors utilizing Landstar provided trailing equipment, which frequently is used on more routine, regular routes.
A significant portion of the Company’s truckload services is priced in the spot market and delivered over irregular or non-repetitive routes, while approximately 24% of the Company’s fiscal year 2025 truck transportation revenue was generated by BCO Independent Contractors utilizing Landstar provided trailing equipment, which frequently is used on more routine, regular routes.
There were 10 transportation service providers, including 3PLs, included in the Company’s top 25 customers for fiscal year 2024. Management believes the Company’s network of agents and third party capacity providers allows it to efficiently attract and service smaller shippers which may not be as desirable to other large transportation providers (see above under “Agent Network”).
There were eight transportation service providers, including 3PLs, included in the Company’s top 25 customers for fiscal year 2025. Management believes the Company’s network of agents and third party capacity providers allows it to efficiently attract and service smaller shippers which may not be as desirable to other large transportation providers (see above under “Agent Network”).
Transportation services offered by the Company include truckload, less-than-truckload and other truck transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul/specialized, cold chain/temperature-controlled, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo and customs brokerage.
Transportation services offered by the Company include truckload, less-than-truckload and other truck transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul/specialized, hazardous materials (“haz-mat”), cold chain/temperature-controlled, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo and customs brokerage.
Commissions to agents are recognized over the freight transit period as the performance obligation to the customer is completed. The Company had 485 and 524 agents that each generated at least $1 million in Landstar revenue (the “Million Dollar Agents”) during fiscal years 2024 and 2023, respectively.
Commissions to agents are recognized over the freight transit period as the performance obligation to the customer is completed. The Company had 457 and 485 agents that each generated at least $1 million in Landstar revenue (the “Million Dollar Agents”) during fiscal years 2025 and 2024, respectively.
The Company is also subject to regulations and requirements relating to safety and security promulgated by, among others, the U.S. Department of Homeland Security through U.S. Customs and the Transportation Security Administration, the Canada Border Services Agency and various state and local agencies and port authorities.
Customs”) as a customs broker. The Company is also subject to regulations and requirements relating to safety and security promulgated by, among others, the U.S. Department of Homeland Security through U.S. Customs and the Transportation Security Administration, the Canada Border Services Agency and various state and local agencies and port authorities.
Trailing Equipment The Company offers its customers a large and diverse fleet of trailing equipment. The following table illustrates the mix of the trailing equipment as of December 28, 2024, either provided by the BCO Independent Contractors or owned or leased by the Company and made available primarily to BCO Independent Contractors.
Trailing Equipment The Company offers its customers a large and diverse fleet of trailing equipment. The following table illustrates the mix of the trailing equipment as of December 27, 2025, either provided by the BCO Independent Contractors or owned or leased by the Company and made available primarily to BCO Independent Contractors.
During fiscal year 2024, the Company billed customers $253 million in fuel surcharges and passed 100% of such fuel surcharges to the BCO Independent Contractors. These fuel surcharges are excluded from revenue and the cost of purchased transportation.
During fiscal year 2025, the Company billed customers $229 million in fuel surcharges and passed 100% of such fuel surcharges to the BCO Independent Contractors. These fuel surcharges are excluded from revenue and the cost of purchased transportation.
Two Landstar Ranger drivers (out of a Company total of approximately 8,843 drivers for BCO Independent Contractors) are members of the International Brotherhood of Teamsters. The turnover rate for Landstar employees located in the United States and Canada was 12% in 2024, 14% in 2023 and 17% in 2022. The Company considers relations with its employees to be good.
Two Landstar Ranger drivers (out of a Company total of approximately 8,514 drivers for BCO Independent Contractors) are members of the International Brotherhood of Teamsters. The turnover rate for Landstar employees located in the United States and Canada was 11% in 2025, 12% in 2024 and 14% in 2023. The Company considers relations with its employees to be good.
Power-only and Truck Brokerage Carrier trailing equipment is not included in the following table: Trailers by Type Van 14,788 Unsided/platform, including flatbeds, step decks, drop decks and low boys 2,718 Temperature-controlled 161 Total 17,667 Specialized services offered by the Company include those provided by a large fleet of platform trailers and multi-axle trailers capable of hauling extremely heavy or oversized loads.
Power-only and Truck Brokerage Carrier trailing equipment is not included in the following table: Trailers by Type Van 14,523 Unsided/platform, including flatbeds, step decks, drop decks and low boys 2,751 Temperature-controlled 152 Total 17,426 Specialized services offered by the Company include those provided by a large fleet of platform trailers and multi-axle trailers capable of hauling extremely heavy or oversized loads.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-six-month term ending April 30, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-seven-month term ending May 31, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
For commercial trucking claims incurred on or after May 1, 2023 through April 30, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-six-month term ending April 30, 2026.
For commercial trucking claims incurred on or after May 1, 2023 through May 31, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-seven-month term ending May 31, 2026.
Landstar formally monitors employee satisfaction and engagement through periodic employee satisfaction and engagement surveys. The Company also uses employee roundtable and focus group discussions as well as exit interviews to monitor engagement and satisfaction. Landstar provides comprehensive professional development opportunities to employees at all levels.
The Company also uses employee roundtable and focus group discussions as well as exit interviews to monitor engagement and satisfaction. Landstar provides comprehensive professional development opportunities to employees at all levels.
The Company’s services emphasize safety, information coordination and customer service and are delivered through a network of approximately 1,050 independent commission sales agents and over 78,000 third party capacity providers, primarily truck capacity providers, linked together by a series of digital technologies which are provided and coordinated by the Company.
The Company’s services emphasize safety, cargo security, information coordination and customer service and are delivered through a network of approximately 960 independent commission sales agents and over 70,000 third party capacity providers, primarily truck capacity providers, linked together by a series of digital technologies which are provided and coordinated by the Company.
Approximately 32% of 2024 turnover was attributable to BCO Independent Contractors who had been with the Company for less than one year.
Approximately 33% of 2025 turnover was attributable to BCO Independent Contractors who had been with the Company for less than one year.
During fiscal year 2024, revenue generated by BCO Independent Contractors and Truck Brokerage Carriers was 38% and 52%, respectively, of consolidated revenue.
During fiscal year 2025, revenue generated by BCO Independent Contractors and Truck Brokerage Carriers was 38% and 53%, respectively, of consolidated revenue.
Larger shippers often consider reducing the number of authorized carriers they use in favor of a small number of “core carriers,” such as the Company, 7 Table of Contents whose size and diverse service capabilities enable these core carriers to satisfy most of the shippers’ transportation needs.
These advantages allow the Company to meet the needs of even the largest shippers. Larger shippers often consider reducing the number of authorized carriers they use in favor of a small number of “core carriers,” such as the Company, whose size and diverse service capabilities enable these core carriers to satisfy most of the shippers’ transportation needs.
The Company continues to focus on identifying, purchasing or developing and implementing software applications and tools which are designed to: (i) assist Landstar independent commission sales agents in efficiently sourcing capacity, pricing transportation services and managing and analyzing the performance of their independent businesses, (ii) assist customers in meeting their transportation needs, (iii) assist third party capacity providers in identifying desirable freight opportunities and operating their independent businesses, and (iv) improve operational and administrative efficiency throughout the Company.
The Company is focused on identifying, purchasing or developing and implementing software applications and tools which integrate AI and are designed to: (i) assist Landstar independent commission sales agents in efficiently sourcing capacity, pricing transportation services and managing and analyzing the performance of their independent businesses, (ii) assist customers in meeting their transportation needs with an emphasis on safety, security and service, (iii) assist third party capacity providers in identifying desirable freight opportunities and operating their independent businesses, and (iv) improve operational and administrative efficiency throughout the Company.
The number of trucks provided by BCO Independent Contractors fluctuates daily as a result of truck recruiting and truck terminations. The Company recruited fewer trucks in fiscal year 2024 than in fiscal year 2023. The Company also terminated fewer trucks in fiscal year 2024 than in fiscal year 2023.
The number of trucks provided by BCO Independent Contractors fluctuates daily as a result of truck recruiting and truck terminations. The Company recruited more trucks in fiscal year 2025 than in fiscal year 2024 and terminated less trucks in fiscal year 2025 than in fiscal year 2024.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending April 30, 2025, the Company would have an aggregate financial exposure of approximately $30 million.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending May 31, 2026, the Company would have an aggregate financial exposure of approximately $36 million.
In addition, at December 28, 2024, 3,258 trailers were provided by the BCO Independent Contractors. Approximately 25% of Landstar’s truck transportation revenue was generated on Landstar-provided trailing equipment during fiscal year 2024. Customers The Company’s customer base is highly diversified and dispersed across many industries, commodities and geographic regions.
In addition, at December 27, 2025, 3,041 trailers were provided by the BCO Independent Contractors. Approximately 24% of Landstar’s truck transportation revenue was generated on Landstar-provided trailing equipment during fiscal year 2025. 7 Table of Contents Customers The Company’s customer base is highly diversified and dispersed across many industries, commodities and geographic regions.
The Company has identified the following employee-focused goals: • Create and maintain an environment in which continuous improvement is encouraged and expected by everyone within the organization; • Engage each Landstar employee in the Company’s vision to inspire and empower entrepreneurs to succeed in the highly competitive, technology driven freight transportation industry; and • Ensure that all Landstar employees fully understand the requirements of their job and the role their job plays within Landstar.
The Company has identified the following employee-focused goals: • Create and maintain an environment in which continuous improvement, collaboration and accountability are encouraged and expected by everyone within the organization; • Engage each Landstar employee in the Company’s vision to inspire and empower entrepreneurs to succeed in the highly competitive, technology driven freight transportation industry; and • Ensure that all Landstar employees fully understand the requirements of their job and the role their job plays within Landstar. 13 Table of Contents Landstar formally monitors employee satisfaction and engagement through periodic employee satisfaction and engagement surveys.
With respect to one such three year commercial auto liability reinsurance arrangement relating to certain excess claims incurred between May 1, 2020 through April 30, 2023, it is anticipated that during the 2025 second fiscal quarter, the Company will receive a $12,000,000 cash payment from a third party reinsurance provider in the form of a “no claims bonus” due to favorable loss experience during the policy period.
During the 2025 fiscal year, with respect to one such three-year commercial auto liability reinsurance arrangement relating to certain excess claims incurred between May 1, 2020 through April 30, 2023, the Company received $12,000,000 of cash payments from third party reinsurance providers in the form of a “no claims bonus” due to favorable loss experience with respect to claims incurred during the applicable policy period.
The Company’s truck transportation services contributed 90% of consolidated revenue in fiscal year 2024, 91% of consolidated revenue in fiscal year 2023 and 89% of consolidated revenue in fiscal year 2022. Rail Intermodal Services.
The Company’s truck transportation services contributed 91% of consolidated revenue in fiscal year 2025, 90% of consolidated revenue in fiscal year 2024 and 91% of consolidated revenue in fiscal year 2023.
At our core, Landstar is about providing opportunity to qualified candidates and employees regardless of background. We do not tolerate discriminatory behavior and strongly believe that diverse perspectives and a collaborative culture lead to better business outcomes.
At our core, Landstar is about providing opportunity to qualified candidates and employees regardless of background. We do not tolerate discriminatory behavior and strongly believe that diverse perspectives and a collaborative culture lead to better business outcomes. The Company complies with all applicable federal and state laws pertaining to employment.
Since the launch of this initiative in 2016, the Company has invested approximately $192 million in this strategic development effort, including approximately $34 million and $35 million, respectively, in fiscal years 2024 and 2023. The Company’s information technology systems used in connection with its operations are located in Jacksonville, Florida and, to a lesser extent, in Rockford, Illinois.
Since the launch of Landstar 2020 in 2016, the Company has invested approximately $220 million in these strategic development efforts, including approximately $28 million and $34 million, respectively, in fiscal years 2025 and 2024. The Company’s information technology systems used in connection with its operations are located in Jacksonville, Florida and, to a lesser extent, in Rockford, Illinois.
In addition, because the U.S. government is one of the Company’s customers, the Company must comply with and is affected by laws and regulations relating to doing business with the federal government. 10 Table of Contents The transportation industry is subject to other potential regulatory and legislative changes (such as the possibility of more stringent environmental, climate change and/or safety/security regulations, limits on vehicle weight and size and regulations relating to the health and wellness of commercial truck operators) that may affect the economics of the industry by requiring changes in operating practices, by changing the demand for motor carrier services or the cost of providing truckload or other transportation or logistics services, or by adversely impacting the number of available commercial truck operators.
The transportation industry is subject to other potential regulatory and legislative changes (such as the possibility of more stringent environmental, climate change and/or safety/security regulations, limits on vehicle weight and size and regulations relating to the health and wellness of commercial truck operators) that may affect the economics of the industry by requiring changes in operating practices, by changing the demand for motor carrier services or the cost of providing truckload or other transportation or logistics services, or by adversely impacting the number of available commercial truck operators.
Management believes the Company, along with its network of capacity providers, offers one of the largest fleets of heavy/specialized trailing equipment in North America. At December 28, 2024, 14,225 of the trailers available to the BCO Independent Contractors were owned by the Company and 184 were rented.
Management believes the Company, along with its network of capacity providers, offers one of the largest fleets of for-hire heavy/specialized trailing equipment in North America. At December 27, 2025, 13,784 of the trailers available to the BCO Independent Contractors were owned by the Company and 601 were rented.
No customer accounted for more than 7% of the Company’s 2024 revenue. Technology Landstar focuses on providing integrated transportation management solutions which emphasize customer service and information coordination among its independent commission sales agents, customers, capacity providers and employees.
No customer accounted for more than 8% of the Company’s 2025 revenue. Technology and Artificial Intelligence (“AI”) Landstar provides integrated transportation management solutions which emphasize customer service and information coordination among its independent commission sales agents, customers, capacity providers and employees.
Also, during fiscal year 2024, truck transportation revenue generated via van equipment and unsided/platform trailing equipment was 56% and 33%, respectively, of truck transportation revenue and less-than-truckload and other truck transportation revenue was 2% and 8%, respectively, of truck transportation revenue.
Also, during fiscal year 2025, truck transportation revenue generated via van equipment and unsided/platform trailing equipment was 54% and 35%, respectively, of truck transportation revenue and less-than-truckload and other truck transportation revenue was 2% and 9%, respectively, of truck transportation revenue.
The number of trucks provided to the Company by BCO Independent Contractors was 8,843 at December 28, 2024, compared to 9,809 at December 30, 2023. At December 28, 2024, approximately 97% of the trucks provided by BCO Independent Contractors were provided by BCO Independent Contractors who provided five or fewer trucks to the Company.
The number of trucks provided to the Company by BCO Independent Contractors was 8,514 at December 27, 2025, compared to 8,843 at December 28, 2024. At December 27, 2025, approximately 96% of the trucks provided by BCO Independent Contractors were provided by BCO Independent Contractors who provided five or fewer trucks to the Company.
However, the decrease in the number of trucks recruited was larger than the decrease in the number of trucks terminated, resulting in an overall net decrease of 966 trucks during fiscal year 2024. Landstar’s BCO Independent Contractor truck turnover was approximately 35% in fiscal year 2024, compared to 41% in fiscal year 2023.
However, the number of trucks recruited was less than the number of trucks terminated, resulting in an overall net 6 Table of Contents decrease of 329 trucks during fiscal year 2025. Landstar’s BCO Independent Contractor truck turnover was approximately 31% in fiscal year 2025, compared to 35% in fiscal year 2024.
Each truck operator, whether working as a BCO Independent Contractor or for a Truck Brokerage Carrier, is required to have a commercial driver’s license and may be subject to mandatory drug and alcohol testing.
Interstate motor carrier operations are subject to safety requirements prescribed by the FMCSA. Each truck operator, whether working as a BCO Independent Contractor or for a Truck Brokerage Carrier, is required to have a commercial driver’s license (“CDL”) and may be subject to mandatory drug and alcohol testing.
Landstar retains liability through a self-insured retention for commercial trucking claims up to $5 million per occurrence. Effective May 1, 2023, the Company entered into a three year commercial auto liability insurance arrangement for losses incurred between $5 million and $10 million (the “2023 Initial Excess Policy”) with a third party insurance company.
Effective May 1, 2023, the Company entered into a three year commercial auto liability insurance arrangement for losses incurred between $5 million and $10 million (the “2023 Initial Excess Policy”) with a third party insurance company.
The Company’s air transportation activities in the United States are subject to regulation by the U.S. Department of Transportation as an indirect air carrier. One of the Operating Subsidiaries is licensed by the U.S. Department of Homeland Security through the Bureau of U.S. Customs and Border Protection (“U.S. Customs”) as a customs broker.
Federal Maritime Commission as non-vessel-operating common carriers and/or as ocean freight forwarders. The Company’s air transportation activities in the United States are subject to regulation by the U.S. Department of Transportation as an indirect air carrier. One of the Operating Subsidiaries is licensed by the U.S. Department of Homeland Security through the Bureau of U.S. Customs and Border Protection (“U.S.
As a result of this strategy, the Company offers the following tools to participants within our network: • Landstar TMS: A cloud-based platform for truckload freight agent workflow. • Blue TMS: A cloud-based platform built specifically to service the truckload brokerage contract services market. • Analytics: A suite of business intelligence applications powered by Microsoft Power BI for independent sales agents and BCO Independent Contractors to access information and identify trends in their businesses. • Pricing Tools: Landstar-proprietary pricing application developed with data scientists using historical Company information and third party pricing data to provide independent commission sales agents with near real time market data. • LandstarOne™: Mobile application available to BCO Independent Contractors and third party motor carriers providing a one-stop location for available loading opportunities as well as fueling station locations, retail fuel prices, fuel prices net of Landstar-arranged discounts and applicable state fuel tax credits, and equipment inspection site locations. • Clarity: Landstar’s proprietary freight tracking tool that incorporates geo-locational data from, among other sources, electronic logging devices, trailer tracking devices and third party data aggregators. • Agent and Capacity Portals: New and improved cloud-based portals built to provide a single on-ramp to a multitude of applications, tools and information available to Landstar independent agents and capacity providers. • Trailer Tools: Applications empowering independent commission sales agents through the automation of the Company’s trailer request and trailer pool management processes. • Credit: Application that automates the process for independent commission sales agents to request customer credit.
Landstar 2020 included the rollout of the following tools to participants within our network: • Landstar TMS: A cloud-based platform for truckload freight agent workflow. • Analytics: A suite of business intelligence applications powered by Microsoft Power BI for independent sales agents and BCO Independent Contractors to access information and identify trends in their businesses. • Pricing Tools: Landstar-proprietary pricing application developed with data scientists using historical Company information and third party pricing data to provide independent commission sales agents with near real time market data. • BCO Retention Tool: Landstar-proprietary application developed with data scientists using a variety of data inputs to help predict when the contractual relationship between a BCO Independent Contractor and Landstar may be at risk. • LandstarOne ™ : Mobile application available to BCO Independent Contractors and third party motor carriers providing a one-stop location for available loading opportunities as well as fueling station locations, retail fuel prices, fuel prices net of Landstar-arranged discounts and applicable state fuel tax credits, and equipment inspection site locations. • Clarity: Landstar’s proprietary freight tracking tool that incorporates geo-locational data from, among other sources, electronic logging devices, trailer tracking devices and third party data aggregators. • Agent and Capacity Portals: New and improved cloud-based portals built to provide a single on-ramp to a multitude of applications, tools and information available to Landstar independent agents and capacity providers. • Trailer Tools: Applications empowering independent commission sales agents through the automation of the Company’s trailer request and trailer pool management processes. • Credit: Application that automates the process for independent commission sales agents to request customer credit. 8 Table of Contents As we moved beyond Landstar 2020, we invested further in digital capabilities within our corporate operations and the support we provide to our entrepreneurial network, including the rollout of modern contact-center technology and significant upgrades to our financial, settlements, and back-office systems.
For a discussion of the risks associated with these laws and regulations, see Part I, Item 1A, “Risk Factors.” Seasonality Landstar’s operations are subject to seasonal trends common to the trucking industry. Historically, truckload shipments for the quarter ending in March are typically lower than for the quarters ending in June, September and December.
For a discussion of the risks associated with these laws and regulations, see Part I, Item 1A, “Risk Factors.” Seasonality Landstar’s operations are subject to seasonal trends common to the trucking industry.
The transportation logistics segment’s rail intermodal services operate with contracts with Class 1 domestic and Canadian railroads, certain short-line railroads and most major asset-based intermodal equipment providers, including agreements with stacktrain operators and container and trailing equipment companies.
Both impairments are included in impairment of intangible and other assets within the Company’s consolidated statements of income. Rail Intermodal Services. The transportation logistics segment’s rail intermodal services operate with contracts with Class 1 domestic and Canadian railroads, certain short-line railroads and most major asset-based intermodal equipment providers, including agreements with stacktrain operators and container and trailing equipment companies.
The FMCSA’s commercial driver’s license and drug and alcohol testing requirements have not adversely affected the Company’s ability to source the capacity necessary to meet its customers’ transportation needs. Additionally, certain of the Operating Subsidiaries are licensed as Ocean Transportation Intermediaries by the U.S. Federal Maritime Commission as non-vessel-operating common carriers and/or as ocean freight forwarders.
The FMCSA’s CDL licensing requirements, drug and alcohol testing requirements, ELP policy and non-domiciled CDL initiative have not adversely affected the Company’s ability to source the capacity necessary to meet its customers’ transportation needs. Additionally, certain of the Operating Subsidiaries are licensed as Ocean Transportation Intermediaries by the U.S.
Subject to federal and state regulatory authorities or regulation, the Company’s capacity providers may transport most types of freight to and from any point in the United States over any route they select. Interstate motor carrier operations are subject to safety requirements prescribed by the FMCSA.
The FMCSA has broad regulatory powers with respect to activities such as motor carrier operations, practices, periodic financial reporting and insurance. Subject to federal and state regulatory authorities or regulation, the Company’s capacity providers may transport most types of freight to and from any point in the United States over any route they select.
Landstar seeks to compensate employees in a manner that is fair, consistent, and reflective of the external market and provides recognition for the achievement of individual goals, corporate objectives, and professional competencies while maintaining fiscal responsibility. Our short and long-term incentive programs are aligned with key business objectives and are intended to motivate strong performance.
Landstar seeks to compensate employees in a manner that is fair, consistent, and reflective of the external market and provides recognition for the achievement of individual strategic, operational, administrative and other goals, corporate objectives, and professional competencies while maintaining fiscal responsibility.
We engage firms nationally recognized in the benefits area to objectively evaluate our programs and benchmark them against peers and other similarly situated organizations. As of December 28, 2024, the Company and its subsidiaries employed 1,441 individuals.
We engage firms nationally recognized in the benefits area to objectively evaluate our programs and benchmark them against peers and other similarly situated organizations. As of December 27, 2025, the Company and its subsidiaries employed 1,378 individuals, or 1,294 individuals excluding employees at Landstar Metro which is classified as held for sale.
Revenue at the insurance segment represents reinsurance premiums from third party insurance companies that provide insurance programs to BCO Independent Contractors where all or a portion of the risk of loss is ultimately borne by Signature. Revenue at the insurance segment represented approximately 1% of the Company’s consolidated revenue in each of fiscal years 2024, 2023 and 2022.
In addition, it reinsures certain risks of the Company’s BCO Independent Contractors and provides certain property and casualty insurance and reinsurance to certain of Landstar’s Operating Subsidiaries. 4 Table of Contents Revenue at the insurance segment represents reinsurance premiums from third party insurance companies that provide insurance programs to BCO Independent Contractors where all or a portion of the risk of loss is ultimately borne by Signature.
See “Notes to Consolidated Financial Statements” for the amount of revenue from external customers and measure of profit attributable to the insurance segment for the last three fiscal years. 4 Table of Contents Factors Significant to the Company’s Operations Management believes the following factors are particularly significant to the Company’s operations: Agent Network The Company’s primary day-to-day contact with its customers is through its network of independent commission sales agents and, to a lesser extent, through employees of the Company.
Factors Significant to the Company’s Operations Management believes the following factors are particularly significant to the Company’s operations: Agent Network The Company’s primary day-to-day contact with its customers is through its network of independent commission sales agents and, to a lesser extent, through employees of the Company.
These third party transportation capacity providers consist of BCO Independent Contractors, Truck Brokerage Carriers, air and ocean cargo carriers and railroads. Landstar’s use of capacity provided by third parties allows it to maintain a lower level of capital investment, resulting in lower fixed costs and a higher return on invested capital.
Landstar’s use of capacity provided by third parties allows it to maintain a lower level of capital investment, resulting in lower fixed costs and a higher return on invested capital. During fiscal year 2025, revenue generated by BCO Independent Contractors, Truck Brokerage Carriers and railroads represented approximately 38%, 53% and 2%, respectively, of the Company’s consolidated revenue.
Landstar revenue from the Million Dollar Agents in the aggregate represented 94% and 95% of consolidated revenue in 2024 and 2023, respectively. Included among the Company’s Million Dollar Agents, the Company had 81 independent sales agencies that generated at least $10 million in Landstar revenue during the 2024 fiscal year, which in aggregate comprised approximately 67% of Landstar’s consolidated revenue.
Included among the Company’s Million Dollar Agents, the Company had 77 independent sales agencies that generated at least $10 million in Landstar revenue during the 2025 5 Table of Contents fiscal year, which in aggregate comprised approximately 68% of Landstar’s consolidated revenue. Management believes that the majority of the Million Dollar Agents represent the Company exclusively.
During fiscal year 2024, revenue generated by BCO Independent Contractors, Truck Brokerage Carriers and railroads represented approximately 38%, 52% and 2%, respectively, of the Company’s consolidated revenue. Collectively, revenue generated by air and ocean cargo carriers represented approximately 6% of the Company’s consolidated revenue during fiscal year 2024.
Collectively, revenue generated by air and ocean cargo carriers represented approximately 5% of the Company’s consolidated revenue during fiscal year 2025.
The insurance segment provides risk and claims management services to certain of Landstar’s Operating Subsidiaries. In addition, it reinsures certain risks of the Company’s BCO Independent Contractors and provides certain property and casualty insurance and reinsurance to certain of Landstar’s Operating Subsidiaries.
The insurance segment provides risk and claims management services to certain of Landstar’s Operating Subsidiaries.
Management believes that the majority of the Million Dollar Agents choose to represent the Company exclusively. Historically, the Company has experienced very few terminations of its Million Dollar Agents, whether such terminations are initiated by the agent or the Company.
Historically, the Company has experienced very few terminations of its Million Dollar Agents, whether such terminations are initiated by the agent or the Company. Annual terminations of Million Dollar Agents have typically been less than 3% of the total number of Million Dollar Agents.
A material increase in the frequency or severity of accidents, cargo claims, including further increases in the amount of cargo theft, or workers’ compensation claims or the material unfavorable development of existing claims could have a material adverse effect on Landstar’s cost of insurance and claims and its results of operations.
A material increase in the frequency or severity of accidents, cargo claims, including further increases in the amount of cargo theft, or workers’ compensation claims or the material unfavorable development of existing claims could have a material adverse effect on Landstar’s cost of insurance and claims and its results of operations. 11 Table of Contents Regulation Certain of the Operating Subsidiaries are considered motor carriers and/or brokers authorized to arrange for transportation services by motor carriers which are regulated by the Federal Motor Carrier Safety Administration (the “FMCSA”) and by various state agencies.
All of our employees must adhere to a code of ethics and employee compliance code that set standards for appropriate behavior and includes required annual training. As of the end of 2024, a majority of the Company’s employees work remotely or on a hybrid basis.
Our management teams and all of our employees are expected to exhibit and promote honest, ethical and respectful conduct in the workplace. All of our employees must adhere to a code of ethics and employee compliance code that set standards for appropriate behavior and includes required annual training.
Annual terminations of Million Dollar Agents have typically been less than 3% of the total number of Million Dollar Agents. 5 Table of Contents Third Party Capacity The Company relies exclusively on independent third parties for its hauling capacity other than for trailing equipment owned or leased by the Company and utilized primarily by the BCO Independent Contractors.
Third Party Capacity The Company relies exclusively on independent third parties for its hauling capacity other than for trailing equipment owned or leased by the Company and utilized primarily by the BCO Independent Contractors. These third party transportation capacity providers consist of BCO Independent Contractors, Truck Brokerage Carriers, air and ocean cargo carriers and railroads.
At December 28, 2024, the Company maintained a database of over 70,000 approved Truck Brokerage Carriers who provide truck capacity to the Company. Truck Brokerage Carriers provide truck capacity to the Company under non-exclusive contractual arrangements and each operates under its own DOT-issued motor carrier operating authority.
Truck Brokerage Carriers provide truck capacity to the Company under non-exclusive contractual arrangements and each operates under its own DOT-issued motor carrier operating authority. Truck Brokerage Carriers are paid either a negotiated rate for each load hauled or, to a lesser extent, a contractually agreed-upon fixed rate per load.
Truck Brokerage Carriers are paid either a negotiated rate for each load hauled or, to a lesser extent, a contractually agreed-upon fixed rate per load. The Company recruits, approves, establishes contracts with and tracks safety ratings and service records of these third party trucking companies.
The Company recruits, approves, establishes contracts with and tracks safety ratings and service records of these third party trucking companies.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending April 30, 2025, the Company experienced an increase of approximately $22 million, or over 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending May 31, 2026, the Company experienced an increase of approximately $22 million, or approximately 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million. 10 Table of Contents In addition to the significant increase in the cost to motor carriers relating to commercial auto liability claims throughout the United States, there has also been a very significant increase throughout the United States in the number of, and potential loss exposure associated with, claims asserted against freight brokers in connection with accidents involving motor carriers the freight broker has engaged and contracted with to haul a shipment.
Human Capital Resources We believe our employees are among our most important resources and are critical to our continued success. We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations.
Landstar has established “Core Values” to help guide employee behavior, decision-making and culture within our Company, and to foster alignment and engagement among our employees. Landstar’s Core Values are: We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations.
Removed
Increasing 6 Table of Contents revenue per load on a sequential basis historically has had a favorable impact on BCO Independent Contractor turnover. During fiscal year 2024, revenue per load on loads hauled by BCO Independent Contractors sequentially increased in the second, third and fourth fiscal quarters. Truck Brokerage Carriers.
Added
As previously disclosed by the Company in a Current Report on Form 8-K filed with the SEC on August 13, 2025, the Company entered into an arrangement with a financial advisor to actively market its Mexican subsidiary, Landstar Metro, S.A.P.I. de C.V.
Removed
These advantages allow the Company to meet the needs of even the largest shippers.
Added
(“Landstar Metro”) and to consider other strategic alternatives for this subsidiary, which may involve a sale or other disposition in whole or in part of Landstar Metro during the Company’s 2026 fiscal year.
Removed
Landstar intends to continue to improve and enhance its technologies to meet the total needs of its agents, customers and third party capacity providers and remains engaged in various multi-year projects aimed at increasing efficiencies, primarily through technology, at Landstar and across our agent and third party capacity network.
Added
It is not anticipated that a sale or other disposition of Landstar Metro will adversely affect the Company’s ability to provide U.S.-Mexico cross-border services, given that Landstar Metro is principally engaged in intra-Mexico truck transportation services.
Removed
Management believes leadership in the development, operation and support of an ecosystem of digital technologies and applications is an ongoing part of providing high quality service.
Added
In connection with the decision to actively market Landstar Metro, the Company recorded a non-cash impairment charge of $7,530,000 to goodwill within the transportation logistics segment. Further, based on the expected fair value of Landstar Metro, net of costs to sell, the Company recognized an impairment on assets held for sale of $10,678,000.
Removed
The Company has engaged in a multi-year effort to implement a comprehensive strategy focused on the long-term development of leading edge digital tools to empower participants in our network to succeed in the technology-driven transportation logistics marketplace.
Added
Revenue at the insurance segment represented approximately 1% of the Company’s consolidated revenue in each of fiscal years 2025, 2024 and 2023. See “Notes to Consolidated Financial Statements” for the amount of revenue from external customers and measure of profit attributable to the insurance segment for the last three fiscal years.
Removed
The Company intends to record the receipt of this payment as a deferred gain on the balance sheet until such time as all underlying claims with exposure under the applicable excess layer insurance arrangement are resolved and the gain can be recognized.
Added
Landstar revenue from the Million Dollar Agents in the aggregate represented 95% and 94% of consolidated revenue in 2025 and 2024, respectively.
Removed
Furthermore, the Company’s third party insurance arrangements provide excess coverage up to an uppermost coverage layer, in excess of which the Company retains additional financial exposure.
Added
Sequential strengthening or weakening of revenue per load historically has also had a significant impact on BCO Independent Contractor turnover. Truck Brokerage Carriers. At December 27, 2025, the Company maintained a database of over 62,000 approved Truck Brokerage Carriers who provide truck capacity to the Company.
Removed
Regulation Certain of the Operating Subsidiaries are considered motor carriers and/or brokers authorized to arrange for transportation services by motor carriers which are regulated by the Federal Motor Carrier Safety Administration (the “FMCSA”) and by various state agencies. The FMCSA has broad regulatory powers with respect to activities such as motor carrier operations, practices, periodic financial reporting and insurance.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Moreover, the Company from year to year manages the level of its financial exposure to commercial trucking claims in excess of $10 million, including through the use of additional self-insurance, deductibles, aggregate loss limits, quota shares and other arrangements with third party insurance companies, based on the availability of coverage within certain excess insurance coverage layers and estimated cost differentials between proposed premiums from third party insurance companies and historical and actuarially projected losses experienced by the Company at various levels of excess insurance coverage.
Moreover, the Company from year to year manages the level of its financial exposure to commercial trucking claims in excess of $10 million, including through the use of additional self-insurance, deductibles, aggregate loss limits, quota shares and other structured arrangements with third party insurance companies, based on the availability of coverage within certain excess insurance coverage layers and estimated cost differentials between proposed premiums from third party insurance companies and historical and actuarially projected losses experienced by the Company at various levels of excess insurance coverage.
A number of these larger agencies, including the largest of Landstar’s independent commission sales agents by revenue, maintain administrative operations in countries outside of North America where the risks may be different than in the United States or Canada due to geopolitical, legal or other risks associated with maintaining administrative operations in such foreign jurisdictions.
A number of these larger agencies, including the second largest of Landstar’s independent commission sales agents by revenue, maintain administrative operations in countries outside of North America where the risks may be different than in the United States or Canada due to geopolitical, legal or other risks associated with maintaining administrative operations in such foreign jurisdictions.
As noted above in Item 1, “Business — Factors Significant to the Company’s Operations — Competition,” Landstar competes primarily in the transportation and logistics services industry. This industry is extremely competitive and fragmented.
Substantial industry competition. As noted above in Item 1, “Business — Factors Significant to the Company’s Operations — Competition,” Landstar competes primarily in the transportation and logistics services industry. This industry is extremely competitive and fragmented.
Landstar competes primarily with truckload carriers, intermodal transportation service providers, railroads, less-than-truckload carriers, third party logistics companies, digital freight brokers and other asset-light transportation and logistics service providers.
Landstar competes primarily with truckload carriers, intermodal transportation service providers, railroads, less-than-truckload carriers, third party logistics companies, freight brokers and other asset-light transportation and logistics service providers.
As disclosed in a Current Report on Form 8-K filed by the Company on February 28, 2022, the largest Landstar independent commission sales agency by revenue referenced above, while based in the United States, has significant administrative operations located in Ukraine.
As disclosed in a Current Report on Form 8-K filed by the Company on February 28, 2022, the second largest Landstar independent commission sales agency by 2025 revenue referenced above, while based in the United States, has significant administrative operations located in Ukraine.
The failure of the Company to maintain or enhance its technology ecosystem in response to changing demands from customers, agents, and capacity providers could have a significant adverse impact on Landstar’s ability to compete for customers, agents and capacity providers in the transportation and logistics industry. In addition, competition in our industry, historically, has created downward pressure on freight rates.
The failure of the Company to maintain or enhance its technology ecosystem in response to changing demands from customers, agents, and capacity providers could have a significant adverse impact on Landstar’s ability to compete for customers, agents and capacity providers in the transportation and logistics industry. 19 Table of Contents In addition, competition in our industry, historically, has created downward pressure on freight rates.
The Company’s air transportation activities in the United States are subject to regulation by the U.S. Department of Transportation as an indirect air carrier. One of the Company’s subsidiaries is licensed by the U.S. Department of Homeland Security through the Bureau of U.S. Customs and Border Protection (“U.S. Customs”) as a customs broker.
The Company’s air transportation activities in the United States are subject to regulation by the U.S. Department of Transportation as an indirect air carrier. One of the Company’s 20 Table of Contents subsidiaries is licensed by the U.S. Department of Homeland Security through the Bureau of U.S. Customs and Border Protection (“U.S. Customs”) as a customs broker.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past decade, there has been a significant increase in the prevalence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past fifteen years, there has been a significant increase in the occurrence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
The loss of some of the Company’s Million Dollar Agents and/or a significant decrease in revenue generated by Million Dollar Agents could have a material adverse effect on Landstar, including its results of operations and revenue. 13 Table of Contents Dependence on third party capacity providers.
The loss of some of the Company’s Million Dollar Agents and/or a significant decrease in revenue generated by Million Dollar Agents could have a material adverse effect on Landstar, including its results of operations and revenue. Dependence on third party capacity providers.
The Company has experienced, and may continue to experience, increases in the amount of cargo theft, resulting in increased exposure to liability from cargo claims.
The Company has experienced, and may continue to experience, increases in the amount of cargo theft, including strategic cargo theft, resulting in increased exposure to liability from cargo claims.
In recent years, the use of technology and the implementation of technology-based innovations have become increasingly important to compete within the transportation and logistics industry. In particular, management believes leadership in the development, operation and support of an ecosystem of digital technologies and applications is an ongoing part of providing high quality service.
In recent years, the use of technology and the implementation of technology-based innovations, which may increasingly incorporate AI, have become increasingly important to compete within the transportation and logistics industry. In particular, management believes leadership in the development, operation and support of an ecosystem of digital technologies and applications is an ongoing part of providing high quality service.
Economic, Competitive and Industry Risks Decreased demand for transportation services; U.S. trade relationships. The transportation industry historically has experienced cyclical financial results as a result of slowdowns in economic activity, the business cycles of customers, and other economic factors beyond Landstar’s control.
Economic, Competitive and Industry Risks Decreased demand for transportation services; U.S. trade relationships and potential or imposed tariffs. The transportation industry historically has experienced cyclical financial results as a result of slowdowns in economic activity, the business cycles of customers, and other economic factors beyond Landstar’s control.
In the event that a claim is made against the Company by a third party for the infringement of intellectual property rights, any settlement or adverse judgment against the Company either in the form of increased costs of licensing or a cease and desist order in using the technology could have an adverse effect on the Company’s business and its results of operations.
In the event that a claim is made against the Company by a third party for the infringement of intellectual property rights, any settlement or adverse judgment against the Company either in the form of increased costs of licensing or a cease and desist order in using the technology could have an adverse effect on the Company’s business and its results of operations. 22 Table of Contents Item 1B.
Item 1A. Risk Factors Operational Risks Increased severity or frequency of accidents and other claims or a material unfavorable development of existing claims. As noted above in Item 1, “Business — Factors Significant to the Company’s Operations — Self-Insured Claims,” potential liability associated with accidents in the trucking industry is severe and occurrences are unpredictable.
Item 1A. Risk Factors Operational Risks Increased severity or frequency of accidents and other claims or a material unfavorable development of existing claims. As noted above in Item 1, “ Business — Factors Significant to the Company ’ s Operations — Self-Insured Claims ,” potential liability associated with accidents in the trucking industry is severe and occurrences are unpredictable.
Although we believe that we have robust security procedures and other safeguards in place, as threats continue to evolve, we may be required to expend additional resources to continue to enhance our information security measures and/or to investigate and remediate any security vulnerabilities.
Although we 17 Table of Contents believe that we have robust security procedures and other safeguards in place, as threats continue to evolve, we may be required to expend additional resources to continue to enhance our information security measures and/or to investigate and remediate any security vulnerabilities.
Accordingly, information security and the continued development and enhancement of the controls and processes designed to protect our systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority for us.
Accordingly, information security and the continued development and enhancement of the controls and processes designed to protect our systems, computers, software, data and networks from attack, damage or unauthorized access, including from AI enabled attacks, remain a priority for us.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending April 30, 2025, the Company experienced an increase of approximately $22 million, or over 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending May 31, 2026, the Company experienced an increase of approximately $22 million, or approximately 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million.
In addition, cybersecurity and business interruption insurance could in the future become more expensive and difficult to maintain and may not be available on commercially reasonable terms or at all. 14 Table of Contents Dependence on key vendors.
In addition, cybersecurity and business interruption insurance could in the future become more expensive and difficult to maintain and may not be available on commercially reasonable terms or at all. Dependence on key vendors.
In addition, Landstar hauls a significant number of shipments that have either been imported into the United States or are destined for export from the United States.
Moreover, Landstar hauls a significant number of shipments that have either been imported into the United States or are destined for export from the United States.
As noted above in Item 1, “Business — Factors Significant to the Company’s Operations — Agent Network,” the Company markets its services primarily through independent commission sales agents. During fiscal year 2024, 485 agents generated revenue for Landstar of at least $1 million each, or in the aggregate approximately 94% of Landstar’s consolidated revenue.
As noted above in Item 1, “Business — Factors Significant to the Company’s Operations — Agent Network,” the Company markets its services primarily through independent commission sales agents. During fiscal year 2025, 457 agents generated revenue for Landstar of at least $1 million each, or in the aggregate approximately 95% of Landstar’s consolidated revenue.
Many large shippers use 3PLs other than the Company to outsource the management and coordination of their transportation needs rather than directly arrange for transportation services with carriers. As noted above, there were 10 transportation service providers, including 3PLs, included in the Company’s top 25 customers for the fiscal year ended December 28, 2024.
Many large shippers use 3PLs other than the Company to outsource the management and coordination of their transportation needs rather than directly arrange for transportation services with carriers. As noted above, there were eight transportation service providers, including 3PLs, included in the Company’s top 25 customers for the fiscal year ended December 27, 2025.
On August 16, 2022, the Inflation Reduction Act was signed into law and established a one percent excise tax on stock repurchases made by publicly traded U.S. corporations. This provision was effective for tax years beginning after December 31, 2022. Accrued excise tax of $717,000 was included in other current liabilities in the consolidated balance sheet at December 28, 2024.
On August 16, 2022, the Inflation Reduction Act was signed into law and established a one percent excise tax on stock repurchases made by publicly traded U.S. corporations. This provision was effective for tax years beginning after December 31, 2022. Accrued excise tax of $1,762,000 was included in other current liabilities in the consolidated balance sheet at December 27, 2025.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-six-month term ending April 30, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-seven-month term ending May 31, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
As an example, for every 100 basis point increase in the U.S. corporate income tax rate, the Company would recognize a one-time tax charge of approximately $800,000 in connection with revaluing its ending net deferred tax liabilities at December 28, 2024.
As an example, for every 100 basis point increase in the U.S. corporate income tax rate, the Company would recognize a one-time tax charge of approximately $1,000,000 in connection with revaluing its ending net deferred tax liabilities at December 27, 2025.
For commercial trucking claims incurred on or after May 1, 2023 through April 30, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-six-month term ending April 30, 2026.
For commercial trucking claims incurred on or after May 1, 2023 through May 31, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-seven-month term ending May 31, 2026.
Customs and the Transportation Security Administration, the Canada Border Services Agency and various state and local agencies and port authorities. 16 Table of Contents The transportation industry is subject to other potential regulatory and legislative changes (such as the possibility of more stringent environmental, climate change and/or safety/security regulations, limits on vehicle weight and size and regulations relating to the health and wellness of commercial truck operators) that may affect the economics of the industry by requiring changes in operating practices, by changing the demand for motor carrier services or the cost of providing truckload or other transportation or logistics services, or by adversely impacting the number of available commercial truck operators.
The transportation industry is subject to other potential regulatory and legislative changes (such as the possibility of more stringent environmental, climate change and/or safety/security regulations, limits on vehicle weight and size and regulations relating to the health and wellness of commercial truck operators) that may affect the economics of the industry by requiring changes in operating practices, by changing the demand for motor carrier services or the cost of providing truckload or other transportation or logistics services, or by adversely impacting the number of available commercial truck operators.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending April 30, 2025, the Company would have an aggregate financial exposure of approximately $30 million.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending May 31, 2026, the Company would have an aggregate financial exposure of approximately $36 million.
Included among these Million Dollar Agents, 81 agents generated at least $10,000,000 of Landstar revenue during the 2024 fiscal year, or in the aggregate approximately 67% of Landstar’s consolidated revenue.
Included among these Million Dollar Agents, 77 agents generated at least $10,000,000 of Landstar revenue during the 2025 fiscal year, or in the aggregate approximately 68% of Landstar’s consolidated revenue.
Landstar retains liability through a self-insured retention for commercial trucking claims up to $5 million per occurrence. Effective May 1, 2023, the Company entered into a three year commercial auto liability insurance arrangement for losses incurred between $5 million and $10 million (the “2023 Initial Excess Policy”) with a third party insurance company.
Effective May 1, 2023, the Company entered into a three year commercial auto liability insurance arrangement for losses incurred between $5 million and $10 million (the “2023 Initial Excess Policy”) with a third party insurance company.
A material increase in the frequency or severity of accidents, cargo claims, including further increases in the amount of cargo theft, or workers’ compensation claims or the material unfavorable development of existing claims could have a material adverse effect on Landstar’s cost of insurance and claims and its results of operations. 12 Table of Contents Dependence on third party insurance companies.
A material increase in the frequency or severity of accidents, cargo claims, or workers’ compensation claims, claims in connection with the transportation of hazardous materials, or the material unfavorable development of existing claims could have a material adverse effect on Landstar’s business, cost of insurance and claims and its results of operations. Dependence on third party insurance companies.
The Company’s exposure to liability associated with accidents incurred by Truck Brokerage Carriers, railroads and air and ocean cargo carriers who transport freight on behalf of the Company is reduced by various legal defenses and other factors including the extent to which such carriers maintain their own insurance coverage.
The Company’s exposure to liability associated with accidents incurred by Truck Brokerage Carriers, railroads and air and ocean cargo carriers who transport freight on behalf of the Company is reduced by various legal defenses and other factors including the extent to which such carriers maintain their own insurance coverage. 15 Table of Contents In recent years, the amount and sophistication of fraud and cargo theft throughout the freight transportation and logistics supply chain has significantly increased.
Nevertheless, federal, state and local governmental agencies may engage in efforts to support legislation and regulations mandating the transition of diesel-fuel based commercial motor vehicles, such as Class 8 tractors operated by the Company’s BCO Independent Contractors and Truck Brokerage Carriers, to ZEVs.
Nevertheless, federal, state and local governmental agencies may engage in efforts to support legislation and regulations mandating the transition of diesel-fuel based commercial motor vehicles, such as Class 8 tractors operated by the Company’s BCO Independent Contractors and Truck Brokerage Carriers, to ZEVs. 21 Table of Contents Mandates requiring the transition to ZEVs would create substantial costs for the Company’s third party capacity providers and, in turn, increase the cost of purchased transportation to the Company.
An increase in the costs to purchase, lease or maintain tractor equipment or in purchased transportation cost caused by existing or new regulations without a corresponding increase in price to the customer could adversely affect Landstar, including its results of operations and financial condition. 17 Table of Contents Moreover, irrespective of the enactment of these types of regulations, no assurances can be provided that the technology advancements that will need to occur to make ZEVs commercially viable for long-haul trucking or the extensive nationwide charging/fueling infrastructure and maintenance network that would be necessary to support such operations will develop in the time frame that would be necessary to enable efforts to comply with legislative or regulatory mandates requiring the transition of diesel fuel-based vehicles to ZEVs.
Moreover, irrespective of the enactment of these types of regulations, no assurances can be provided that the technology advancements that will need to occur to make ZEVs commercially viable for long-haul trucking or the extensive nationwide charging/fueling infrastructure and maintenance network that would be necessary to support such operations will develop in the time frame that would be necessary to enable efforts to comply with legislative or regulatory mandates requiring the transition of diesel fuel-based vehicles to ZEVs.
The Company is also subject to regulations and requirements relating to safety and security promulgated by, among others, the U.S. Department of Homeland Security through U.S.
The Company is also subject to regulations and requirements relating to safety and security promulgated by, among others, the U.S. Department of Homeland Security through U.S. Customs and the Transportation Security Administration, the Canada Border Services Agency and various state and local agencies and port authorities.
The Company also has another of its largest independent commission sales agencies, as measured by revenue, that is based in the United States but conducts a portion of its administrative operations in western Ukraine. Russian efforts to destroy infrastructure throughout Ukraine has impacted the availability of electricity and other basic utilities at various times throughout the country.
The Company also has another of its largest independent commission sales agencies, as measured by revenue, that is based in the United States but conducts a portion of its administrative operations in 16 Table of Contents western Ukraine.
The excise tax could have an adverse effect on the Company’s cash flows in future years. Intellectual property. The Company uses both internally developed and purchased technology in conducting its business. Whether internally developed or purchased, it is possible that the use of these technologies could be claimed to infringe upon or violate the intellectual property rights of third parties.
The excise tax could have an adverse effect on the Company’s cash flows in future years. General Risk Factors Intellectual property. The Company uses both internally developed and purchased technology in conducting its business.
An increase in costs to implement these initiatives without a corresponding increase in price to the customer could adversely affect Landstar, including its results of operations and financial condition. General Risk Factors Potential changes in taxes. From time to time, various legislative proposals are introduced to increase federal, state, or local taxes.
An increase in costs to implement these initiatives without a corresponding increase in price to the customer could adversely affect Landstar, including its results of operations and financial condition. Supply Chain Fraud Matter.
A prolonged decrease in freight rates could have a material adverse effect on Landstar, including its revenue and operating income. 15 Table of Contents Legal, Tax, Regulatory and Compliance Risks Status of independent contractors.
A prolonged decrease in freight rates could have a material adverse effect on Landstar, including its revenue and operating income. Legal, Tax, Regulatory and Compliance Risks Status of independent contractors. For many years, the topic of the classification of individuals as employees or independent contractors has garnered significant attention among federal and state regulators as well as the plaintiffs’ bar.
There is significant uncertainty in the marketplace as to the potential actions of the U.S. government with respect to international trade policy and the potential for significant tariffs to be enacted, particularly with respect to trade between the United States and, respectively, Mexico, Canada and China.
There is significant uncertainty in the marketplace as to the potential actions of the U.S. government with respect to international trade policy, and the impact of tariffs may significantly adversely impact our customers, our industry, and our business.
Of these larger agencies, one such Landstar independent commission sales agency, itself with a very diversified customer base, generated approximately $470,000,000, or 10%, of Landstar’s consolidated revenue and approximately 5% of Landstar’s consolidated variable contribution in fiscal year 2024.
Of these larger agencies, two such Landstar independent commission sales agencies each generated over 10% of Landstar’s consolidated revenue, or in the aggregate approximately $994,000,000, or 21%, of Landstar’s consolidated revenue and approximately 16% of Landstar’s consolidated variable contribution in fiscal year 2025.
Further, the Company retains liability of up to $2,000,000 for each general liability claim, $250,000 for each workers’ compensation claim and $250,000 for each cargo claim. In recent years, the amount of cargo theft throughout the freight transportation and logistics supply chain in the United States has significantly increased.
The Company retains liability of up to $2,000,000 for each general liability claim, $250,000 for each workers’ compensation claim and $250,000 for each cargo claim.
The priority for Landstar and both of these agencies is the safety and well-being of these agencies’ Ukrainian workforces and their families.
Russian efforts to destroy infrastructure throughout Ukraine has impacted the availability of electricity and other basic utilities at various times throughout the country. The priority for Landstar and both of these agencies is the safety and well-being of these agencies’ Ukrainian workforces and their families.
Removed
Furthermore, the Company’s third party insurance arrangements provide excess coverage up to an uppermost coverage layer, in excess of which the Company retains additional financial exposure.
Added
Landstar retains liability through a self-insured retention for commercial trucking claims up to $5 million per occurrence. Historically, these third party insurance arrangements were based on policy year periods beginning on May 1 and ending on the subsequent April 30.
Removed
The adoption of AI and other emerging technologies may become significant to operating results in the future. While AI and other technologies may offer substantial benefits, they may also introduce additional risk. If we are unable to successfully adapt to, implement and utilize such emerging technologies as effectively as competitors, our results of operations may be negatively affected.
Added
Beginning with the policy year period commencing May 1, 2025, the Company and its third party insurance providers adjusted the applicable policy year period, beginning in 2026, to commence on June 1 and end on the subsequent May 31.
Removed
Any decision by the U.S. government to adopt actions such as an increase in tariffs or customs duties, a border tax on imports, the renegotiation of U.S. trade agreements, in particular, the United States-Mexico-Canada Agreement, or any other action that could have a negative impact on international trade could cause a reduction in the volume of freight shipped by many Landstar customers.
Added
All applicable third party insurance arrangements with a policy period ending April 30, 2026 have been amended to provide for a policy period ending May 31, 2026, as reflected below.
Removed
Any changes in tax and trade policies in the United States and corresponding actions by other countries, including a retaliatory increase in tariffs on goods destined for export from the United States, could adversely affect our financial performance. Substantial industry competition.
Added
In addition to the significant increase in the cost to motor carriers relating to commercial auto liability claims throughout the United States, there has also been a very significant increase throughout the United States in the number of, and potential loss exposure associated with, claims asserted against freight brokers in connection with accidents involving motor carriers the freight broker has engaged and contracted with to haul a shipment.
Removed
For many years, the topic of the classification of individuals as employees or independent contractors has garnered significant attention among federal and state regulators as well as the plaintiffs’ bar.
Added
The claims asserted against freight brokers often involve claims of 14 Table of Contents negligent selection of the motor carrier who was involved in the relevant accident.
Removed
For example, CARB has adopted a regulation, the Advanced Clean Trucks (“ACT”) regulation intended to accelerate a large-scale transition to medium-and heavy-duty ZEVs. The regulation includes a manufacturer sales requirement and a reporting requirement that applies to large employers including retailers, manufacturers, brokers and others, as well as fleet owners with 50 or more trucks operating in California.
Added
Within the transportation logistics industry, these matters are often referred to as “Broker Liability Claims.” For example, see the discussion of the Cabral Matter (as defined below) in Item 7, “ Management’s Discussion and Analysis of Financial Condition and Results of Operations — Legal Proceedings. ” There is currently significant legal uncertainty regarding Broker Liability Claims as state and federal courts across the United States are divided as to whether such claims are preempted by federal law under the FAAAA, or are subject to the “safety exception” under the FAAAA.
Removed
The following states have also adopted the ACT regulation: Colorado, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont and Washington. Mandates requiring the transition to ZEVs would create substantial costs for the Company’s third party capacity providers and, in turn, increase the cost of purchased transportation to the Company.
Added
The matter of Montgomery v. Caribe Transport II, LLC, in which the Company is not a party, is currently pending before the U.S. Supreme Court and may result in a ruling relating to federal preemption of Broker Liability Claims under the FAAAA. No assurances can be provided as to any such ruling by the U.S.
Added
Supreme Court, the timing thereof, or the impact any such ruling may have on pending or future Broker Liability Claims asserted against the Company, including the Cabral Matter.
Added
Within the Company’s third party insurance arrangements providing excess coverage for commercial trucking liabilities, structured arrangements with third party reinsurers within a specific loss layer may include provisions that require additional payments of premium in the event of unfavorable loss experience or a refund of premium in the event of favorable loss experience.
Added
During the 2025 fiscal year, with respect to one such three-year commercial auto liability reinsurance arrangement relating to certain excess claims incurred between May 1, 2020 through April 30, 2023, the Company received $12,000,000 of cash payments from third party reinsurance providers in the form of a “no claims bonus” due to favorable loss experience with respect to claims incurred during the applicable policy period.
Added
As further described in Note 11 in the “Notes to Consolidated Financial Statements” in this Annual Report on Form 10-K, in connection with the Judgment (as defined below) in the Cabral Matter, the Company has recorded the “no claims bonus” within current insurance claims in the consolidated balance sheet as of December 27, 2025.
Added
The Company intends to vigorously appeal the Cabral Matter, including the Judgment; however, no assurances can be provided regarding whether the Company will ultimately be able to recognize a gain with respect to the “no claims bonus.” For more information about the Cabral Matter, see Item 7, “ Management’s Discussion and Analysis of Financial Condition and Results of Operations – Legal Proceedings .” Furthermore, the Company’s third party insurance arrangements provide excess coverage up to an uppermost coverage layer, in excess of which the Company retains additional financial exposure.
Added
As noted below in Item 1, “ Legal, Tax, Regulatory and Compliance Risks — Regulatory and legislative changes ,” several of the Operating Subsidiaries maintain a federal hazardous materials safety permit in connection with the Company’s transportation of hazardous substances.
Added
In the event the Company is involved in a spill or other accident involving hazardous substances, there is a release of hazardous materials while such hazardous materials are being transported by the Company, or Landstar is found to be in violation of or fail to comply with applicable environmental laws or regulations in connection with the transportation of hazardous materials, the Company could be subject to clean-up costs and liabilities, including substantial fines or penalties or civil and criminal liability, any of which could have a material adverse effect on the Company’s business and results of operations.
Added
In particular, “strategic” cargo theft refers to instances when bad actors incorporate deceptive tactics to commit cargo theft. Such tactics may involve the use of fraud to deceive shippers, brokers, and/or carriers using a combination of methods including identity theft and impersonation, fictitious track-and-trace information, fictitious proof of delivery information and fraudulent carrier schemes.
Added
The Company has also experienced, and may continue to experience, incidences of other types of supply chain fraud, for example the fraud referenced in Note 19 in the “Notes to Consolidated Financial Statements” in this Annual Report on Form 10-K.
Added
The Company uses, and will continue to expand its use of, machine learning and AI technologies to deliver services and operate its business.
Added
If the Company fails to successfully integrate AI into its digital ecosystem and business processes, or if it fails to keep pace with rapidly evolving AI technological developments, including attracting and retaining talented AI developers and programmers and cybersecurity personnel, the Company may face a competitive disadvantage.
Added
At the same time, the use or offering of AI technologies may result in new or expanded risks and liabilities, including enhanced government or regulatory scrutiny, litigation, privacy and compliance issues, ethical or confidentiality concerns, reputational harm, and security risks.
Added
It is not possible to predict all of the risks related to the use of AI, and changes in laws, rules, directives, and regulations governing the use of AI may adversely affect the Company’s ability to develop and use AI or subject it to legal liability.
Added
The cost of complying with laws and regulations governing AI could be significant and could increase our operating expenses, which could adversely affect our business, financial condition, and results of operations.
Added
Further, market demand and acceptance of AI technologies, including by our independent commission sales agents and BCO Independent Contractors, are uncertain, and we may be unsuccessful in efforts to further incorporate AI into our ecosystem of digital tools that are designed to: (i) assist Landstar independent commission sales agents in efficiently sourcing capacity, pricing transportation services and managing and analyzing the performance of their independent businesses, (ii) assist customers in meeting their transportation needs, (iii) assist third party capacity providers in identifying desirable freight opportunities and operating their independent businesses, and (iv) improve operational and administrative efficiency throughout the Company.
Added
Acquisitions, Divestitures and Investments. The Company periodically considers acquisitions and equity investments that it believes are strategically important based on the potential that any such acquisition or investment candidate would further strengthen the Company’s strategic goals and service offerings.
Added
The Company makes no assurance that it will be able to successfully achieve its strategic goals as it relates to any such acquisition or investment. Further, the Company may have difficulties integrating acquired companies or efficiently managing divestitures. For potential acquisitions, success may depend upon efficiently integrating the acquired business into our existing systems and operations.
Added
If we complete a large acquisition or multiple acquisitions within a short period of time, we may experience heightened difficulties integrating the acquired companies. The Company would also be required to integrate these acquired businesses into our internal control environment, which may present challenges that are different than those presented by organic growth and that may be difficult to manage.
Added
If we are unable to successfully integrate and grow any acquired businesses and to realize contemplated revenue synergies and cost savings from such acquisitions, our business, prospects, results of operations, financial position, and cash flows could be materially and adversely affected. During 2017, the Company established Landstar Metro, S.A.P.I. de C.V.
Added
(“Landstar Metro”), which acquired substantially all of the assets of the asset-light transportation logistics business of Fletes Avella, S.A. de C.V. Landstar Metro provides freight and logistics services within Mexico and in conjunction with Landstar’s U.S.-Mexico cross-border services. The Company’s initial investment in Landstar Metro was approximately $8.5 million.
Added
The carrying value of the Company’s investment in Landstar 18 Table of Contents Metro, as of December 27, 2025, was approximately $6.5 million, reflecting additional investment and the results of operations of Landstar Metro since inception, less non-cash impairment charges.
Added
Landstar Metro is subject to certain risks arising from doing business in Mexico, including: changes in Mexico’s economic strength; changes in trade agreements, US-Mexico trade relations, or the imposition of tariffs on imports from Mexico and related retaliatory tariffs that may be imposed by the Mexican government; disruptions related to port of entry restrictions; difficulties in enforcing contractual obligations; foreign currency fluctuations; theft or vandalism of equipment; and social, political, and economic instability.
Added
As previously disclosed in a Current Report on Form 8-K, filed with the SEC on August 13, 2025, in connection with an annual strategic review of the Company’s operations, the Company determined that Landstar Metro has not been able to meet the Company’s strategic or operational goals and expectations, and, in connection therewith, the Company entered into an arrangement with a financial advisor to actively market Landstar Metro and consider strategic alternatives for this business, which may involve a sale or other disposition in whole or in part of Landstar Metro.
Added
No assurances can be provided regarding any potential sale or other disposition of Landstar Metro and whether any additional non-cash impairment charges or other additional charges and expenses will be incurred by the Company in connection with this sale process or upon any ultimate disposition of Landstar Metro.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

7 edited+5 added−2 removed13 unchanged
Members of our IT department collaborate with the Management Risk Committee, as necessary, to gather insights for identifying and assessing cybersecurity threats, their severity, and potential mitigations. Our cybersecurity risk management and strategy processes are led by the Chief Information Officer and the Vice President of Network Services, who are each members of the Management Risk Committee .
Members of our IT department collaborate with the Management Risk Committee, as necessary, to gather insights for identifying and assessing cybersecurity threats, their severity, and potential mitigations. Our cybersecurity risk management and strategy processes are led by the Chief Information Officer and the Chief Information Security Officer, who are each members of the Management Risk Committee.
The Company describes whether and how risks from identified cybersecurity threats materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition, under the heading “Disruptions or failures in the Company’s computer systems; cyber and other information security incidents” included as part of our risk factor disclosure at Item 1A of this Annual Report on Form 10-K, which disclosures are incorporated by reference herein. 19 Table of Contents Cybersecurity is an important part of our risk management processes and an area of focus for our Board and management.
The Company describes whether and how risks from identified cybersecurity threats materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition, under the heading “Disruptions or failures in the Company’s computer systems; cyber and other information security incidents” included as part of our risk factor disclosure at Item 1A of this Annual Report on Form 10-K, which disclosures are incorporated by reference herein.
The team of IT professionals led by the Vice President of Network Services includes individuals with relevant degrees and certifications, including Certified Information Security Systems Professional (CISSP), GIAC Foundational Cybersecurity Technologies (GFACT), GIAC Certified Incident Handler Certification (GCIH), GIAC Security Essentials (GSEC), ITIL 4 Foundations, Qualys Certified Specialist - Vulnerability Management Detection & Response, Microsoft Technology Associate: Security Fundamentals, Google Cloud Certified: Professional Cloud Security Engineer, Cisco Certified CyberOps Associate, Cisco Certified Network Associate (CCNA), CompTIA Security+, and CompTIA Pentest+.
The team of IT professionals led by the Chief Information Security Officer includes individuals with relevant academic credentials and industry-recognized certifications, including Certified Information Security Systems Professional (CISSP), GIAC Foundational Cybersecurity Technologies (GFACT), GIAC Certified Incident Handler Certification (GCIH), GIAC Security Essentials (GSEC), ITIL 4 Foundations, Qualys Certified Specialist—Vulnerability Management Detection & Response, Microsoft Technology Associate: Security Fundamentals, Google Cloud Certified: Professional Cloud Security Engineer, Cisco Certified CyberOps Associate, Cisco Certified Network Associate (CCNA), CompTIA Security+, and CompTIA Pentest+.
The Safety and Risk Committee of the Board is responsible for the oversight of risks from cybersecurity threats. At least semi-annually, the Management Risk Committee and, subsequently, the Safety and Risk Committee of the Board receive an overview of our cybersecurity threat risk management and strategy processes from the Chief Information Officer and the Vice President of Network Services.
At least semi-annually, the Management Risk Committee and, subsequently, the Safety and Risk Committee of the Board receive an overview of our cybersecurity threat risk management and strategy processes from the Chief Information Officer and Chief Information Security Officer.
Our cybersecurity risk management processes also address risks associated with our use of third party service providers, including those who have access to our employee data or our systems that support customers and our network of independent commission sales agents and third party capacity providers.
These third parties analyze data on the interactions of users of our information technology resources, including employees, and conduct penetration tests and vulnerability scanning exercises to assess the performance of our cybersecurity controls, systems and processes. 23 Table of Contents Our cybersecurity risk management processes also address risks associated with our use of third party service providers, including those who have access to our employee data or our systems that support customers and our network of independent commission sales agents and third party capacity providers.
Our cybersecurity risk management processes incorporate appropriate industry standards and are designed using the frameworks developed by National Institute of Standards and Technology (“NIST”) as a guide. Our enterprise risk management program reports at least quarterly to the Management Risk Committee and considers cybersecurity threat risks alongside other types of risks as part of our overall risk assessment process.
Our cybersecurity risk management processes incorporate appropriate industry standards and are designed using the frameworks developed by National Institute of Standards and Technology (“NIST”) as a guide. The Company has established a Management Risk Committee.
The Management Risk Committee consists of those members of executive management of the Company with ultimate responsibility for the Company’s enterprise risk management practices. Members of the Management Risk Committee regularly engage in discussions and meetings relating to cybersecurity risk management and strategy processes and the prevention, detection, mitigation and remediation of cybersecurity incidents.
The Management Risk Committee meets at least quarterly and considers cybersecurity threat risks alongside other types of risks as part of the Company’s risk assessment and management process. Members of the Management Risk Committee regularly engage in discussions and meetings relating to cybersecurity risk management and strategy processes and the prevention, detection, mitigation and remediation of cybersecurity incidents.
Removed
In particular, the Vice President of Network Services leads a team of IT professionals that includes individuals with significant cybersecurity expertise. The Vice President of Network Services has over 27 years of experience in various roles with the Company as well as with the U.S. Army involving managing information security, developing cybersecurity strategy, implementing effective information and cybersecurity programs.
Added
The Company has also established an Executive Risk Committee that meets monthly and focuses on enterprise risk management. The Executive Risk Committee is comprised of the Chief Executive Officer, the Chief Financial Officer, the Chief Safety and Operations Officer and the General Counsel.
Removed
These third parties analyze data on the interactions of users of our information technology resources, including employees, and conduct penetration tests and vulnerability scanning exercises to assess the performance of our cybersecurity controls, systems and processes.
Added
The Chief Information Officer and the Chief Information Security Officer regularly meet with the Executive Risk Committee to review and consider cybersecurity-related risks from an enterprise risk management perspective. The Chief Information Security Officer leads a team of IT professionals that includes individuals with significant cybersecurity expertise.
Added
The Chief Information Security Officer has over 30 years of experience in cybersecurity and information technology across multiple publicly traded organizations, with the responsibility for leading and managing cybersecurity, developing cybersecurity strategy, and designing and implementing effective cybersecurity programs.
Added
Prior to joining the Company in June 2025, the Chief Information Security Officer served as Chief Information Security Officer of LL Flooring.
Added
Cybersecurity is an important part of our risk management processes and an area of focus for our Board and management. The Safety and Risk Committee of the Board is responsible for the oversight of risks from cybersecurity threats.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+0 added−1 removed1 unchanged
The following table presents information related to securities authorized for issuance under these plans at December 28, 2024: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options Weighted-average Exercise Price of Outstanding Options Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Equity Compensation Plans Approved by Security Holders 0 0 2,981,152 Equity Compensation Plans Not Approved by Security Holders 0 0 0 Under the 2011 EIP, the issuance of (i) a non-vested share of Landstar Common Stock issued in the form of restricted stock and (ii) a share of Landstar Common Stock issued upon the vesting of a previously granted restricted stock unit each counts as the issuance of two securities against the number of securities available for future issuance.
The following table presents information related to securities authorized for issuance under these plans at December 27, 2025: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options Weighted-average Exercise Price of Outstanding Options Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Equity Compensation Plans Approved by Security Holders 0 0 2,854,641 Equity Compensation Plans Not Approved by Security Holders 0 0 0 Under the 2011 EIP, the issuance of (i) a non-vested share of Landstar Common Stock issued in the form of restricted stock and (ii) a share of Landstar Common Stock issued upon the vesting of a previously granted restricted stock unit each counts as the issuance of two securities against the number of securities available for future issuance.
As of such date, Landstar had 35,316,073 shares of Common Stock outstanding and had 136 stockholders of record of its Common Stock. However, the Company estimates that it has a significantly greater number of stockholders because a substantial number of the Company’s shares are held by brokers or dealers for their customers in street name.
As of such date, Landstar had 34,058,726 shares of Common Stock outstanding and had 148 stockholders of record of its Common Stock. However, the Company estimates that it has a significantly greater number of stockholders because a substantial number of the Company’s shares are held by brokers or dealers for their customers in street name.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Common Stock of the Company is listed and traded on the NASDAQ Global Select Market under the symbol “LSTR.” The reported last sale price per share of the Common Stock as reported on the NASDAQ Global Select Market on January 24, 2025 was $173.04 per share.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Common Stock of the Company is listed and traded on the NASDAQ Global Select Market under the symbol “LSTR.” The reported last sale price per share of the Common Stock as reported on the NASDAQ Global Select Market on January 23, 2026 was $153.94 per share.
Included in the number of securities remaining available for future issuance under equity compensation plans were 181,450 shares of Common Stock reserved for issuance under the 2022 DSCP. 21 Table of Contents Financial Model Shareholder Returns The following graph illustrates the return that would have been realized, assuming reinvestment of dividends, by an investor who invested $100 in each of the Company’s Common Stock, the Standard and Poor’s 500 Stock Index and the Dow Jones Transportation Stock Index for the period commencing December 28, 2019 through December 28, 2024. 22 Table of Contents Item 6.
Included in the number of securities remaining available for future issuance under equity compensation plans were 172,859 shares of Common Stock reserved for issuance under the 2022 DSCP. 25 Table of Contents Financial Model Shareholder Returns The following graph illustrates the return that would have been realized, assuming reinvestment of dividends, by an investor who invested $100 in each of the Company’s Common Stock, the Standard and Poor’s 500 Stock Index and the Dow Jones Transportation Stock Index for the period commencing December 26, 2020 through December 27, 2025. 26 Table of Contents Item 6.
On December 7, 2021, the Landstar System, Inc. Board of Directors authorized the Company to purchase up to 1,912,824 shares of the Company’s Common Stock from time to time in the open market and in privately negotiated transactions. On December 6, 2022, the Landstar System, Inc.
On December 7, 2021, the Landstar System, Inc. Board of Directors authorized the Company to purchase up to 1,912,824 shares of the Company’s Common Stock from time to time in the open market and in privately negotiated transactions. This program was completed during fiscal year 2025. On December 6, 2022, the Landstar System, Inc.
Board of Directors authorized the Company to purchase up to 319,332 additional shares of its Common Stock from time to time in the open market and in privately negotiated transactions under its share purchase program. As of December 28, 2024, the Company had authorization to purchase in the aggregate up to 2,547,981 shares of its Common Stock under these programs.
Board of Directors authorized the Company to purchase up to 319,332 additional shares of its Common Stock from time to time in the open market and in privately negotiated transactions under its share purchase program. As of December 27, 2025, the Company had authorization to purchase in the aggregate up to 1,266,118 shares of its Common Stock under these programs.
Purchases of Equity Securities by the Company The following table provides information regarding the Company’s purchase of its Common Stock during the period from September 29, 2024 to December 28, 2024, the Company’s fourth fiscal quarter: Fiscal Period Total Number of Shares Purchased Average Price Paid Per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Programs Maximum Number of Shares That May Yet Be Purchased Under the Programs September 28, 2024 2,563,081 Sept. 29, 2024 – Oct. 26, 2024 — $ — — 2,563,081 Oct. 27, 2024 – Nov. 23, 2024 15,100 178.96 15,100 2,547,981 Nov. 24, 2024 – Dec. 28, 2024 — — — 2,547,981 Total 15,100 $ 178.96 15,100 (1) The average price paid per share does not include the 1% excise tax on net stock repurchases, as applicable.
Purchases of Equity Securities by the Company The following table provides information regarding the Company’s purchase of its Common Stock during the period from September 28, 2025 to December 27, 2025, the Company’s fourth fiscal quarter: Fiscal Period Total Number of Shares Purchased Average Price Paid Per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Programs Maximum Number of Shares That May Yet Be Purchased Under the Programs September 27, 2025 1,552,813 Sept. 28, 2025 – Oct. 25, 2025 — $ — — 1,552,813 Oct. 26, 2025 – Nov. 22, 2025 230,462 127.11 230,462 1,322,351 Nov. 23, 2025 – Dec. 27, 2025 56,233 130.39 56,233 1,266,118 Total 286,695 $ 127.76 286,695 (1) The average price paid per share does not include the 1% excise tax on net stock repurchases, as applicable.
Equity Compensation Plan Information The Company maintains a stock compensation plan for members of its Board of Directors, the 2022 Directors Stock Compensation Plan (the “2022 DSCP”), and an employee equity incentive plan, the 2011 Equity Incentive Plan (the “2011 EIP”).
No specific expiration date has been assigned to the December 6, 2022 or December 4, 2023 authorizations. Equity Compensation Plan Information The Company maintains a stock compensation plan for members of its Board of Directors, the 2022 Directors Stock Compensation Plan (the “2022 DSCP”), and an employee equity incentive plan, the 2011 Equity Incentive Plan (the “2011 EIP”).
Removed
No specific expiration date has been assigned to the December 7, 2021, December 6, 2022 or December 4, 2023 authorizations.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

85 edited+32 added−16 removed106 unchanged
Examples of the industries serviced by the transportation logistics segment include automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics and military equipment and general commodities. In addition, the transportation logistics segment provides transportation services to other transportation companies, including third party logistics and less-than-truckload service providers.
Examples of the industries serviced by the transportation logistics segment include automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics, military equipment and general commodities. In addition, the transportation logistics segment provides transportation services to other transportation companies, including third party logistics and less-than-truckload service providers.
It should be noted that billings to many customers of the Company’s truck brokerage services include a single all-in rate and do not separately identify fuel surcharges on loads hauled via Truck Brokerage Carriers.
It should be noted that billings to many customers of the Company’s truck brokerage services include a single all-in rate and do not separately identify fuel surcharges on loads hauled via Truck Brokerage Carriers.
The decrease in shareholders’ equity was primarily the result of dividends declared by the Company and purchases of shares of the Company’s Common Stock in fiscal year 2024, partially offset by net income.
The decrease in shareholders’ equity in fiscal year 2024 was primarily the result of dividends declared by the Company and purchases of shares of the Company’s Common Stock, partially offset by net income.
The Company believes that operating income as a percentage of variable contribution is useful and meaningful to investors for the following principal reasons: (i) the variable costs of revenue for a significant portion of the business are highly influenced by short-term market-based trends in the freight transportation industry, whereas other costs, including other costs of revenue, are much less impacted by short-term freight market trends; (ii) disclosure of this measure allows investors to better understand the underlying trends in the Company’s results of operations; (iii) this measure is meaningful to 30 Table of Contents investors’ evaluations of the Company’s management of costs attributable to operations other than the purely variable costs associated with purchased transportation and commissions to agents that the Company incurs to provide services to our customers; and (iv) management considers this financial information in its decision-making, such as budgeting for infrastructure, trailing equipment and selling, general and administrative costs.
The Company believes that operating income as a percentage of variable contribution is useful and meaningful to investors for the following principal reasons: (i) the variable costs of revenue for a significant portion of the business are highly influenced by short-term market-based trends in the freight transportation industry, whereas other costs, including other costs of revenue, are much less impacted by short-term freight market trends; (ii) disclosure of this measure allows investors to better understand the underlying trends in the Company’s results of operations; (iii) this measure is meaningful to 35 Table of Contents investors’ evaluations of the Company’s management of costs attributable to operations other than the purely variable costs associated with purchased transportation and commissions to agents that the Company incurs to provide services to our customers; and (iv) management considers this financial information in its decision-making, such as budgeting for infrastructure, trailing equipment and selling, general and administrative costs.
Through this network of agents and capacity providers linked together by Landstar’s ecosystem of digital technologies, Landstar operates an integrated transportation management solutions business primarily throughout North America with revenue of $4.8 billion during the most recently completed fiscal year. The Company reports the results of two operating segments: the transportation logistics segment and the insurance segment.
Through this network of agents and capacity providers linked together by Landstar’s ecosystem of digital technologies, Landstar operates an integrated transportation management solutions business primarily throughout North America with revenue of $4.7 billion during the most recently completed fiscal year. The Company reports the results of two operating segments: the transportation logistics segment and the insurance segment.
(2) Includes primarily reinsurance premium revenue generated by the insurance segment and intra-Mexico transportation services revenue generated by Landstar Metro. 26 Table of Contents Expenses Purchased transportation Also critical to the Company’s success is its ability to secure capacity, particularly truck capacity, at rates that allow the Company to profitably transport customers’ freight.
(2) Includes primarily reinsurance premium revenue generated by the insurance segment and intra-Mexico transportation services revenue generated by Landstar Metro. 30 Table of Contents Expenses Purchased transportation Also critical to the Company’s success is its ability to secure capacity, particularly truck capacity, at rates that allow the Company to profitably transport customers’ freight.
Revenue from accounts formerly handled by terminated Million Dollar Agents is often retained by the Company as the customer may choose to transfer its account to an existing Landstar agent. 25 Table of Contents Management monitors business activity by tracking the number of loads (volume) and revenue per load by mode of transportation.
Revenue from accounts formerly handled by terminated Million Dollar Agents is often retained by the Company as the customer may choose to transfer its account to an existing Landstar agent. 29 Table of Contents Management monitors business activity by tracking the number of loads (volume) and revenue per load by mode of transportation.
The unfavorable development of prior years’ claims in the 2024, 2023 and 2022 fiscal years was attributable in each year to several specific claims.
The unfavorable development of prior years’ claims in the 2024 and 2023 fiscal years was attributable in each year to several specific claims.
Revenue at the insurance segment represents reinsurance premiums from third party insurance companies that provide insurance programs to BCO Independent Contractors where all or a portion of the risk is ultimately borne by Signature. Revenue at the insurance segment represented approximately 1% of the Company’s consolidated revenue for fiscal year 2024.
Revenue at the insurance segment represents reinsurance premiums from third party insurance companies that provide insurance programs to BCO Independent Contractors where all or a portion of the risk is ultimately borne by Signature. Revenue at the insurance segment represented approximately 1% of the Company’s consolidated revenue for fiscal year 2025.
Such statements are by nature subject to uncertainties and risks, including but not limited to: an increase in the frequency or severity of accidents or other claims; unfavorable development of existing accident claims; dependence on third party insurance companies; dependence on independent commission sales agents; dependence on third party capacity providers; the impact of the Russian conflict with Ukraine on the operations of certain independent commission sales agents, including the Company’s largest such agent by revenue in the 2024 fiscal year; decreased demand for transportation services; U.S. trade relationships; substantial industry competition; disruptions or failures in the Company’s computer systems; cyber and other information security incidents; dependence on key vendors; potential changes in taxes; status of independent contractors; regulatory and legislative changes; regulations focused on diesel emissions and other air quality matters; regulations requiring the purchase and use of zero-emission vehicles; intellectual property; and other operational, financial or legal risks or uncertainties detailed in this and Landstar’s other SEC filings from time to time and described in Item 1A in this Form 10-K under the heading “Risk Factors.” These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated.
Such statements are by nature subject to uncertainties and risks, including but not limited to: decreased demand for transportation services; U.S. trade relationships and potential or imposed tariffs; an increase in the frequency or severity of accidents or other claims; unfavorable development of existing accident claims; dependence on third party insurance companies; dependence on independent commission sales agents; dependence on third party capacity providers; the impact of the Russian conflict with Ukraine on the operations of certain independent commission sales agents, including the Company’s second largest such agent by revenue in the 2025 fiscal year; substantial industry competition; disruptions or failures in the Company’s computer systems; cyber and other information security incidents; dependence on key vendors; potential changes in taxes; status of independent contractors; regulatory and legislative changes; regulations focused on diesel emissions and other air quality matters; regulations requiring the purchase and use of zero-emission vehicles; intellectual property; acquisitions and investments; and other operational, financial or legal risks or uncertainties detailed in this and Landstar’s other SEC filings from time to time and described in Item 1A in this Form 10-K under the heading “Risk Factors.” These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated.
Other costs of revenue include fixed costs of revenue and semi-variable costs of revenue, where such costs may vary over time based on certain economic factors or operational metrics such as the number of Company-controlled trailers, the number of BCO Independent Contractors, the frequency and severity of insurance claims, the number of miles traveled by BCO Independent Contractors, or the number and/or scale of information technology projects in process or in-service to support revenue generating activities, rather than on a shipment-by-shipment basis.
Other costs 33 Table of Contents of revenue include fixed costs of revenue and semi-variable costs of revenue, where such costs may vary over time based on certain economic factors or operational metrics such as the number of Company-controlled trailers, the number of BCO Independent Contractors, the frequency and severity of insurance claims, the number of miles traveled by BCO Independent Contractors, or the number and/or scale of information technology projects in process or in-service to support revenue generating activities, rather than on a shipment-by-shipment basis.
Approximately 43% of the Company’s consolidated revenue in fiscal year 2024 was generated under transactions that pay a fixed percentage of revenue to the third party capacity provider and/or agents while 57% was generated under transactions that pay a variable percentage of revenue to the third party capacity provider and/or agents.
Approximately 43% of the Company’s consolidated revenue in fiscal year 2025 was generated under transactions that pay a fixed percentage of revenue to the third party capacity provider and/or agents while 57% was generated under transactions that pay a variable percentage of revenue to the third party capacity provider and/or agents.
As an asset-light provider of integrated transportation management solutions, the Company’s annual capital requirements for operating property are generally for trailing equipment and information technology hardware and software. In addition, a significant portion of the trailing equipment used by the Company is provided by third party capacity providers, thereby reducing the Company’s capital requirements.
As an asset-light provider of integrated transportation management solutions, the Company’s annual capital requirements for operating property are generally for trailing equipment and information 41 Table of Contents technology hardware and software. In addition, a significant portion of the trailing equipment used by the Company is provided by third party capacity providers, thereby reducing the Company’s capital requirements.
The Company refers to revenue less variable costs of revenue as “variable contribution” and variable contribution divided by revenue as “variable contribution margin”. Variable contribution and variable contribution margin are each non-GAAP financial measures. The closest comparable GAAP financial measures to variable contribution and variable contribution margin are, respectively, gross profit and gross profit margin.
The Company refers to revenue less variable costs of revenue as “variable contribution” and variable contribution divided by revenue as “variable contribution margin.” Variable contribution and variable contribution margin are each non-GAAP financial measures. The closest comparable GAAP financial measures to variable contribution and variable contribution margin are, respectively, gross profit and gross profit margin.
The Company’s exposure to liability associated with accidents incurred by Truck Brokerage Carriers, railroads and air and ocean cargo carriers who transport 28 Table of Contents freight on behalf of the Company is reduced by various legal defenses and other factors including the extent to which such carriers maintain their own insurance coverage.
The Company’s exposure to liability associated with accidents incurred by Truck Brokerage Carriers, railroads and air and ocean cargo carriers who transport freight on behalf of the Company is reduced by various legal defenses and other factors including the extent to which such carriers maintain their own insurance coverage.
Selling, general and administrative During the 2024 fiscal year, employee compensation and benefits accounted for approximately 62% of the Company’s selling, general and administrative costs. Employee compensation and benefits include wages and employee benefit costs as well as incentive compensation and stock-based compensation expense.
Selling, general and administrative During the 2025 fiscal year, employee compensation and benefits accounted for approximately 62% of the Company’s selling, general and administrative costs. Employee compensation and benefits include wages and employee benefit costs as well as incentive compensation and stock-based compensation expense.
During the 2024 and 2023 fiscal years, insurance and claims costs included $8,824,000 and $6,058,000 of net unfavorable adjustments to prior years’ claims estimates, respectively. 32 Table of Contents Selling, general and administrative costs increased $5,909,000 in fiscal year 2024 as compared to fiscal year 2023.
During the 2024 and 2023 fiscal years, insurance and claims costs included $8,824,000 and $6,058,000 of net unfavorable adjustments to prior years’ claims estimates, respectively. Selling, general and administrative costs increased $5,909,000 in fiscal year 2024 as compared to fiscal year 2023.
The increase in other operating costs compared to the prior year was primarily due to an increased provision for contractor bad debt and decreased gains on sales of operating property. Insurance and claims decreased $312,000 in fiscal year 2024 compared to fiscal year 2023.
The increase in other operating costs compared to the prior year was primarily due to an increased provision for contractor bad debt and decreased gains on sales of operating property. 39 Table of Contents Insurance and claims decreased $312,000 in fiscal year 2024 compared to fiscal year 2023.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past decade, there has been a significant increase in the prevalence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
These third party arrangements provide coverage on a per occurrence or aggregated basis. Over the past fifteen years, there has been a significant increase in the occurrence of trials in courts throughout the United States involving catastrophic injury and fatality claims against commercial motor carriers that have resulted in verdicts in excess of $10 million.
Investments, all of which are carried at fair value, include primarily investment-grade bonds, asset-backed securities and commercial paper having maturities of up to five years. Fair value of investments is based primarily on quoted market prices. See “Notes to Consolidated Financial Statements” included herein for further discussion on measurement of fair value of investments.
Investments, all of which are carried at fair value, include primarily investment-grade bonds, asset-backed securities, commercial paper and U.S. Treasury obligations having maturities of up to five years. Fair value of investments is based primarily on quoted market prices. See “Notes to Consolidated Financial Statements” included herein for further discussion on measurement of fair value of investments.
During fiscal year 2024, the Company purchased 452,019 shares of its Common Stock at a total cost of $82,117,000, including $81,400,000 in cash purchases and accrued excise tax of $717,000 which is included in other current liabilities in the consolidated balance sheet at December 28, 2024.
During fiscal year 2024, the Company purchased 452,019 shares of its Common Stock at a total cost of $82,117,000, including $81,400,000 in cash purchases and accrued excise tax of $717,000 which was included in other current liabilities in the consolidated balance sheet at December 28, 2024 and paid during fiscal year 2025.
Changes in Financial Condition and Results of Operations Management believes the Company’s success principally depends on its ability to generate freight through its network of independent commission sales agents and to deliver freight safely and efficiently utilizing third party capacity providers.
Changes in Financial Condition and Results of Operations Management believes the Company’s success principally depends on its ability to generate freight through its network of independent commission sales agents and to deliver freight safely, securely and efficiently utilizing BCO Independent Contractors and other third party capacity providers.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending April 30, 2025, the Company experienced an increase of approximately $22 million, or over 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million.
Since the annual policy year ended April 30, 2020, as compared to the annual policy year ending May 31, 2026, the Company experienced an increase of approximately $22 million, or approximately 400%, in the premiums charged by third party insurance companies to the Company for excess coverage for commercial trucking liabilities in excess of $10 million.
Transportation services offered by the Company include truckload, less-than-truckload and other truck transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air 23 Table of Contents delivery of time-critical freight, heavy-haul/specialized, cold chain/temperature-controlled, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo and customs brokerage.
Transportation services offered by the Company include truckload, less-than-truckload and other truck transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air 27 Table of Contents delivery of time-critical freight, heavy-haul/specialized, hazardous materials (“haz-mat”), cold chain/temperature-controlled, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo and customs brokerage.
Landstar anticipates acquiring either by purchase or lease financing approximately $16,000,000 in new trailing equipment, primarily to replace older trailing equipment in fiscal year 2025. Landstar anticipates spending approximately $14,000,000 on information technology hardware and software in fiscal year 2025, $12,000,000 of which relates to either building or buying software applications that enhance or add to the Company’s technology ecosystem.
Landstar anticipates acquiring either by purchase or lease financing approximately $104,000,000 in new trailing equipment, primarily to replace older trailing equipment in fiscal year 2026. Landstar anticipates spending approximately $12,000,000 on information technology hardware and software in fiscal year 2026, $6,000,000 of which relates to either building or buying software applications that enhance or add to the Company’s technology ecosystem.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-six-month term ending April 30, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
After payment of the deductible, the 2023 Initial Excess Policy provides for a limit for a single loss of $5 million, with an aggregate limit of $15 million for the thirty-seven-month term ending May 31, 2026. The Company also maintains third party insurance arrangements providing excess coverage for commercial trucking liabilities in excess of $10 million.
In fiscal year 2023, the change in the number of Million Dollar Agents was attributable to agents who remained with the Company yet experienced lower year-over-year revenue that resulted in such agents moving below the Million Dollar Agent category due to the softer freight demand environment.
In fiscal year 2024, the change in the number of Million Dollar Agents was primarily attributable to agents who remained with the Company yet experienced lower year-over-year revenue that resulted in such agents moving below the Million Dollar Agent category due to the soft freight demand environment.
The increase in shareholders’ equity in fiscal year 2023 was primarily the result of net income, partially offset by dividends declared by the Company and purchases of shares of the Company’s Common Stock in fiscal year 2023.
The decrease in shareholders’ equity was primarily the result of purchases of shares of the Company’s Common Stock and dividends declared by the Company in fiscal year 2025, partially offset by net income.
Historically, the Company has experienced both favorable and unfavorable development of prior years’ claims estimates within its various programs. During fiscal years 2024, 2023 and 2022, insurance and claims costs included $8,824,000, $6,058,000 and $11,331,000 of net unfavorable adjustments to prior years’ claims estimates, respectively.
Historically, the Company has experienced both favorable and unfavorable development of prior years’ claims estimates within its various programs. During fiscal years 2025, 2024 and 2023, insurance and claims costs included $32,082,000, $8,824,000 and $6,058,000 of net unfavorable adjustments to prior years’ claims estimates, respectively.
The following table shows the number of Million Dollar Agents, the average revenue generated by these agents and the percent of consolidated revenue generated by these agents during the past three fiscal years: Fiscal Years 2024 2023 2022 Number of Million Dollar Agents 485 524 625 Average revenue generated per Million Dollar Agent $ 9,388,000 $ 9,645,000 $ 11,499,000 Percent of consolidated revenue generated by Million Dollar Agents 94 % 95 % 97 % In fiscal year 2024, the change in the number of Million Dollar Agents was primarily attributable to agents who remained with the Company yet experienced lower year-over-year revenue that resulted in such agents moving below the Million Dollar Agent category due to the softer freight demand environment.
The following table shows the number of Million Dollar Agents, the average revenue generated by these agents and the percent of consolidated revenue generated by these agents during the past three fiscal years: Fiscal Years 2025 2024 2023 Number of Million Dollar Agents 457 485 524 Average revenue generated per Million Dollar Agent $ 9,827,000 $ 9,388,000 $ 9,645,000 Percent of consolidated revenue generated by Million Dollar Agents 95 % 94 % 95 % In fiscal year 2025, the change in the number of Million Dollar Agents was primarily attributable to agents who remained with the Company yet experienced lower year-over-year revenue that resulted in such agents moving below the Million Dollar Agent category due to the soft freight demand environment.
For commercial trucking claims incurred on or after May 1, 2023 through April 30, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-six-month term ending April 30, 2026.
For commercial trucking claims incurred on or after May 1, 2023 through May 31, 2026, the 2023 Initial Excess Policy provides for an aggregate deductible of $18 million over the thirty-seven-month term ending May 31, 2026.
Such other factors include consolidations among agencies or transactions in connection with ownership 24 Table of Contents changes often due to retirement planning, estate planning or similar transitional matters.
Such other factors include consolidations among agencies or transactions in connection with ownership changes often due to retirement planning, estate planning or similar transitional matters.
Landstar has historically operated with current ratios within the range of 1.5 to 1 to 2.0 to 1. Cash provided by operating activities was $286,561,000, $393,648,000, and $622,659,000 in fiscal years 2024, 2023 and 2022, respectively.
Landstar has historically operated with current ratios within the range of 1.5 to 1 to 2.0 to 1. Cash provided by operating activities was $224,882,000, $286,561,000, and $393,648,000 in fiscal years 2025, 2024 and 2023, respectively.
The Company’s services emphasize safety, information coordination and customer service and are delivered through a network of approximately 1,050 independent commission sales agents and over 78,000 third party capacity providers, primarily truck capacity providers, linked together by a series of digital technologies which are provided and coordinated by the Company.
The Company’s services emphasize safety, cargo security, information coordination and customer service and are delivered through a network of approximately 960 independent commission sales agents and over 70,000 third party capacity providers, primarily truck capacity providers, linked together by a series of digital technologies which are provided and coordinated by the Company.
Included among the Company’s Million Dollar Agents in the 2024 fiscal year, the Company had 81 independent sales agencies that generated at least $10 million in Landstar revenue.
Included among the Company’s Million Dollar Agents in the 2025 fiscal year, the Company had 77 independent sales agencies that generated at least $10 million in Landstar revenue.
None of these covenants are presently considered by the Company to be materially restrictive to the Company’s operations, capital resources or liquidity. The Company is currently in compliance with all of the debt covenants under the Credit Agreement. At December 28, 2024, the Company had no borrowings outstanding and $35,250,000 of letters of credit outstanding under the Credit Agreement.
None of these covenants are presently considered by the Company to be materially restrictive to the Company’s operations, capital resources or liquidity. The Company is currently in compliance with all of the debt covenants under the Credit Agreement. At December 27, 2025, the Company had no borrowings outstanding and $34,916,000 of letters of credit outstanding under the Credit Agreement.
During fiscal year 2024, revenue generated by BCO Independent Contractors, Truck Brokerage Carriers and railroads represented approximately 38%, 52% and 2%, respectively, of the Company’s consolidated revenue. Collectively, revenue generated by air and ocean cargo carriers represented approximately 6% of the Company’s consolidated revenue during fiscal year 2024.
During fiscal year 2025, revenue generated by BCO Independent Contractors, Truck Brokerage Carriers and railroads represented approximately 38%, 53% and 2%, respectively, of the Company’s consolidated revenue. Collectively, revenue generated by air and ocean cargo carriers represented approximately 5% of the Company’s consolidated revenue during fiscal year 2025.
The decrease in revenue from reinsurance premiums was primarily attributable to a decrease in the average number of trucks provided by BCO Independent Contractors in fiscal year 2024 compared to fiscal year 2023. 31 Table of Contents Truck transportation revenue generated by BCO Independent Contractors and Truck Brokerage Carriers (together, the “third party truck capacity providers”) for fiscal year 2024 was $4,346,554,000, representing 90% of total revenue, a decrease of $482,976,000, or 10%, compared to fiscal year 2023.
The decrease in revenue from reinsurance premiums was primarily attributable to a decrease in the average number of trucks provided by BCO Independent Contractors in fiscal year 2024 compared to fiscal year 2023. 38 Table of Contents Truck transportation revenue generated by third party truck capacity providers for fiscal year 2024 was $4,346,554,000, representing 90% of total revenue, a decrease of $482,976,000, or 10%, compared to fiscal year 2023.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending April 30, 2025, the Company would have an aggregate financial exposure of approximately $30 million.
For example, with respect to a single hypothetical claim in the amount of $65 million incurred during the annual policy year ending May 31, 2026, the Company would have an aggregate financial exposure of approximately $36 million.
Revenue per load on loads hauled via van equipment decreased 16%, on less-than-truckload loadings decreased 10%, on loads hauled by other truck transportation services decreased 9% and on loads hauled via unsided/platform equipment decreased 6% as compared to fiscal year 2022. Fuel surcharges billed to customers on revenue generated by BCO Independent Contractors are excluded from revenue.
Revenue per load on loads hauled via unsided/platform equipment increased 3%, while revenue per load on less-than-truckload loadings decreased 3%, on loads hauled via van equipment decreased 1% and on other truck transportation services decreased 1% as compared to fiscal year 2024. Fuel surcharges billed to customers on revenue generated by BCO Independent Contractors are excluded from revenue.
Net income was $264,394,000, or $7.36 per basic and diluted share, in fiscal year 2023. Net income was $430,914,000, or $11.76 per basic and diluted share, in fiscal year 2022.
Net income was $264,394,000, or $7.36 per basic and diluted share, in fiscal year 2023.
During fiscal years 2024, 2023 and 2022, the Company acquired $62,194,000, $4,093,000 and $30,659,000, respectively, of trailing equipment by entering into finance leases. During fiscal years 2024, 2023 and 2022, the Company also purchased $30,998,000, $25,688,000 and $26,005,000, respectively, of operating property.
During fiscal years 2025, 2024 and 2023, the Company acquired $7,732,000, $62,194,000 and $4,093,000, respectively, of trailing equipment by entering into finance leases. During fiscal years 2025, 2024 and 2023, the Company also purchased $9,880,000, $30,998,000 and $25,688,000, respectively, of operating property.
With respect to one such three year commercial auto liability reinsurance arrangement relating to certain excess claims incurred between May 1, 2020 through April 30, 2023, it is anticipated that during the 2025 second fiscal quarter, the Company will receive a $12,000,000 cash payment from a third party reinsurance provider in the form of a “no claims bonus” due to favorable loss experience with respect to claims incurred during the policy period.
During the 2025 fiscal year, with respect to one such three-year commercial auto liability reinsurance arrangement relating to certain excess claims incurred between May 1, 2020 through April 30, 2023, the Company received $12,000,000 of cash payments from third party reinsurance providers in the form of a “no claims bonus” due to favorable loss experience with respect to claims incurred during the applicable policy period.
Revenue per load on revenue generated by multimode capacity providers decreased approximately 31% in fiscal year 2023 compared to fiscal year 2022, and the number of loads hauled by multimode capacity providers decreased approximately 24% over the same period.
Revenue per load on revenue generated by multimode capacity providers decreased approximately 10% in fiscal year 2025 compared to fiscal year 2024, and the number of loads hauled by multimode capacity providers decreased approximately 2% over the same period.
The following table summarizes the number of available truck capacity providers as of the end of the three most recent fiscal years: Dec. 28, 2024 Dec. 30, 2023 Dec. 31, 2022 BCO Independent Contractors 8,082 9,024 10,393 Truck Brokerage Carriers: Approved and active (1) 43,718 49,111 66,745 Other approved 26,527 27,524 30,999 70,245 76,635 97,744 Total available truck capacity providers 78,327 85,659 108,137 Trucks provided by BCO Independent Contractors 8,843 9,809 11,281 (1) Active refers to Truck Brokerage Carriers who moved at least one load in the 180 days immediately preceding the fiscal year end.
The following table summarizes the number of available truck capacity providers as of the end of the three most recent fiscal years: Dec. 27, 2025 Dec. 28, 2024 Dec. 30, 2023 BCO Independent Contractors 7,712 8,082 9,024 Truck Brokerage Carriers: Approved and active (1) 36,852 43,718 49,111 Other approved 25,938 26,527 27,524 62,790 70,245 76,635 Total available truck capacity providers 70,502 78,327 85,659 Trucks provided by BCO Independent Contractors 8,514 8,843 9,809 (1) Active refers to Truck Brokerage Carriers who moved at least one load in the 180 days immediately preceding the fiscal year end.
Capital Resources and Liquidity Working capital and the ratio of current assets to current liabilities were $646,713,000 and 2.0 to 1, respectively, at December 28, 2024, compared with $677,517,000 and 2.0 to 1, respectively, at December 30, 2023, and $561,255,000 and 1.6 to 1, respectively, at December 31, 2022.
Capital Resources and Liquidity Working capital and the ratio of current assets to current liabilities were $520,486,000 and 1.7 to 1, respectively, at December 27, 2025, compared with $646,713,000 and 2.0 to 1, respectively, at December 28, 2024, and $677,517,000 and 2.0 to 1, respectively, at December 30, 2023.
The Company believes variable contribution and variable contribution margin are important performance measurements and management considers variable contribution and variable contribution margin in evaluating the Company’s financial performance and in its decision-making, such as budgeting for infrastructure, trailing equipment and selling, general and administrative costs. 29 Table of Contents The reconciliations of gross profit to variable contribution and gross profit margin to variable contribution margin are each presented below: Fiscal Year 2024 2023 2022 Revenue $ 4,819,245 $ 5,303,322 $ 7,436,562 Costs of revenue: Purchased transportation 3,745,241 4,068,262 5,804,017 Commissions to agents 392,751 462,668 614,865 Variable costs of revenue 4,137,992 4,530,930 6,418,882 Trailing equipment depreciation 27,950 31,319 36,653 Information technology costs 22,744 25,486 19,834 Insurance-related costs (1) 115,764 116,069 127,605 Other operating costs 58,781 54,191 45,192 Other costs of revenue 225,239 227,065 229,284 Total costs of revenue 4,363,231 4,757,995 6,648,166 Gross profit $ 456,014 $ 545,327 $ 788,396 Gross profit margin 9.5 % 10.3 % 10.6 % Plus: other costs of revenue 225,239 227,065 229,284 Variable contribution $ 681,253 $ 772,392 $ 1,017,680 Variable contribution margin 14.1 % 14.6 % 13.7 % (1) Insurance-related costs in the table above include (i) other costs of revenue related to the transportation of freight that are included as a portion of insurance and claims in the Company’s Consolidated Statements of Income and (ii) certain other costs of revenue related to reinsurance premiums received by Signature that are included as a portion of selling, general and administrative in the Company’s Consolidated Statements of Income.
The Company believes variable contribution and variable contribution margin are important performance measurements and management considers variable contribution and variable contribution margin in evaluating the Company’s financial performance and in its decision-making, such as budgeting for infrastructure, trailing equipment and selling, general and administrative costs. 34 Table of Contents The reconciliations of gross profit to variable contribution and gross profit margin to variable contribution margin are each presented below: Fiscal Year 2025 2024 2023 Revenue $ 4,743,760 $ 4,819,245 $ 5,303,322 Costs of revenue: Purchased transportation 3,688,343 3,745,241 4,068,262 Commissions to agents 387,397 392,751 462,668 Variable costs of revenue 4,075,740 4,137,992 4,530,930 Trailing equipment depreciation 27,195 27,950 31,319 Information technology costs 13,675 22,744 25,486 Insurance-related costs (1) 161,370 115,764 116,069 Other operating costs 61,586 58,781 54,191 Other costs of revenue 263,826 225,239 227,065 Total costs of revenue 4,339,566 4,363,231 4,757,995 Gross profit $ 404,194 $ 456,014 $ 545,327 Gross profit margin 8.5 % 9.5 % 10.3 % Plus: other costs of revenue 263,826 225,239 227,065 Variable contribution $ 668,020 $ 681,253 $ 772,392 Variable contribution margin 14.1 % 14.1 % 14.6 % (1) Insurance-related costs in the table above include (i) other costs of revenue related to the transportation of freight that are included as a portion of insurance and claims in the Company’s Consolidated Statements of Income and (ii) certain other costs of revenue related to reinsurance premiums received by Signature that are included as a portion of selling, general and administrative in the Company’s Consolidated Statements of Income.
Fiscal Year 2024 2023 2022 Gross profit $ 456,014 $ 545,327 $ 788,396 Operating income $ 248,907 $ 344,149 $ 571,083 Operating income as % of gross profit 54.6 % 63.1 % 72.4 % Variable contribution $ 681,253 $ 772,392 $ 1,017,680 Operating income $ 248,907 $ 344,149 $ 571,083 Operating income as % of variable contribution 36.5 % 44.6 % 56.1 % The decrease in operating income as a percentage of gross profit from fiscal year 2023 to fiscal year 2024, as well as from fiscal year 2022 to fiscal year 2023, resulted from the decrease of operating income at a more rapid percentage rate than the decrease in gross profit, primarily due to the impact of the Company’s fixed cost infrastructure, principally certain components of selling, general and administrative costs, in comparison to a smaller gross profit base.
Fiscal Year 2025 2024 2023 Gross profit $ 404,194 $ 456,014 $ 545,327 Operating income $ 151,577 $ 248,907 $ 344,149 Operating income as % of gross profit 37.5 % 54.6 % 63.1 % Variable contribution $ 668,020 $ 681,253 $ 772,392 Operating income $ 151,577 $ 248,907 $ 344,149 Operating income as % of variable contribution 22.7 % 36.5 % 44.6 % The decrease in operating income as a percentage of gross profit from fiscal year 2024 to fiscal year 2025 resulted from the decrease of operating income at a more rapid percentage rate than the decrease in gross profit, primarily due to the impact of the impairment of certain intangible and other assets and the impact of the Company’s fixed cost infrastructure, principally certain components of selling, general and administrative costs, in comparison to a smaller gross profit base.
At December 28, 2024, there was $264,750,000 available for future borrowings under the Credit Agreement and access to an additional $300,000,000 under the Credit Agreement’s “accordion” feature. In addition, the Company has $74,321,000 in letters of credit outstanding as collateral for insurance claims that are secured by investments totaling $82,579,000 at December 28, 2024.
At December 27, 2025, there was $265,084,000 available for future borrowings under the Credit Agreement and access to an additional $300,000,000 under the Credit Agreement’s “accordion” feature. In addition, the Company has $75,331,000 in letters of credit outstanding as collateral for insurance claims that are secured by investments totaling $83,701,000 at December 27, 2025.
Management believes that cash flow from operations combined with the Company’s borrowing capacity under the Credit Agreement will be adequate to meet Landstar’s debt service requirements, fund continued growth, both internal and through acquisitions, pay dividends, complete the authorized share purchase programs and meet working capital needs. 36 Table of Contents Legal Proceedings The Company is involved in certain claims and pending litigation arising from the normal conduct of business.
Management believes that cash flow from operations combined with the Company’s borrowing capacity under the Credit Agreement will be adequate to meet Landstar’s debt service requirements, fund continued growth, both internal and through acquisitions, pay dividends, complete the authorized share purchase programs and meet working capital needs.
The decrease in operating income as a percentage of variable contribution from fiscal year 2022 to fiscal year 2023 resulted from operating income decreasing at a more rapid percentage rate than the decrease in variable contribution, primarily due to the impact of the Company’s fixed cost infrastructure, principally certain components of selling, general and administrative costs, in comparison to a smaller variable contribution base, partially offset by the impact of decreased incentive and equity compensation costs under the Company’s variable compensation programs.
The decrease in operating income as a percentage of gross profit from fiscal year 2023 to fiscal year 2024 resulted from the decrease of operating income at a more rapid percentage rate than the decrease in gross profit, primarily due to the impact of the Company’s fixed cost infrastructure, principally certain components of selling, general and administrative costs, in comparison to a smaller gross profit base.
Accordingly, the overall impact of changes in fuel prices on revenue and revenue per load on loads hauled via truck is likely to be greater than that indicated. Transportation revenue generated by multimode capacity providers for fiscal year 2023 was $364,935,000, or 7% of total revenue, a decrease of $339,068,000, or 48%, compared to fiscal year 2022.
Accordingly, the overall impact of changes in fuel prices on revenue and revenue per load on loads hauled via truck is likely to be greater than that indicated. Transportation revenue generated by multimode capacity providers for fiscal year 2024 was $374,230,000, or 8% of total revenue, an increase of $9,295,000, or 3%, compared to fiscal year 2023.
The number of loads hauled by third party truck capacity providers decreased approximately 17% in fiscal year 2023 compared to fiscal year 2022, and revenue per load on loads hauled by third party truck capacity providers decreased approximately 13% compared to fiscal year 2022.
The number of loads hauled by third party truck capacity providers decreased approximately 1% in fiscal year 2025 compared to fiscal year 2024, while revenue per load on loads hauled by third party truck capacity providers increased approximately 1% compared to fiscal year 2024.
The following table summarizes this information by trailer type for truck transportation and by mode for all others for the past three fiscal years: Fiscal Years 2024 2023 2022 Revenue generated through (in thousands): Truck transportation Truckload: Van equipment $ 2,447,810 $ 2,742,281 $ 3,892,085 Unsided/platform equipment 1,455,663 1,490,393 1,760,357 Less-than-truckload 99,828 117,683 142,438 Other truck transportation (1) 343,253 479,173 835,959 Total truck transportation 4,346,554 4,829,530 6,630,839 Rail intermodal 84,328 98,297 145,017 Ocean and air cargo carriers 289,902 266,638 558,986 Other (2) 98,461 108,857 101,720 $ 4,819,245 $ 5,303,322 $ 7,436,562 Revenue on loads hauled via BCO Independent Contractors included in total truck transportation $ 1,821,989 $ 1,998,408 $ 2,636,036 Number of loads: Truck transportation Truckload: Van equipment 1,170,772 1,259,578 1,496,247 Unsided/platform equipment 476,815 504,765 558,530 Less-than-truckload 153,253 175,650 191,233 Other truck transportation (1) 160,120 201,407 320,790 Total truck transportation 1,960,960 2,141,400 2,566,800 Rail intermodal 27,970 29,620 40,710 Ocean and air cargo carriers 34,440 32,820 41,850 2,023,370 2,203,840 2,649,360 Loads hauled via BCO Independent Contractors included in total truck transportation 814,150 898,610 1,027,480 Revenue per load: Truck transportation Truckload: Van equipment $ 2,091 $ 2,177 $ 2,601 Unsided/platform equipment 3,053 2,953 3,152 Less-than-truckload 651 670 745 Other truck transportation (1) 2,144 2,379 2,606 Total truck transportation 2,217 2,255 2,583 Rail intermodal 3,015 3,319 3,562 Ocean and air cargo carriers 8,418 8,124 13,357 Revenue per load on loads hauled via BCO Independent Contractors $ 2,238 $ 2,224 $ 2,566 Revenue by capacity type (as a % of total revenue): Truck capacity providers: BCO Independent Contractors 38 % 38 % 35 % Truck Brokerage Carriers 52 % 53 % 54 % Rail intermodal 2 % 2 % 2 % Ocean and air cargo carriers 6 % 5 % 8 % Other 2 % 2 % 1 % (1) Includes power-only, expedited, straight truck, cargo van, and miscellaneous other truck transportation revenue generated by the transportation logistics segment.
The following table summarizes this information by trailer type for truck transportation and by mode for all others for the past three fiscal years: Fiscal Years 2025 2024 2023 Revenue generated through (in thousands): Truck transportation Truckload: Van equipment $ 2,328,386 $ 2,447,810 $ 2,742,281 Unsided/platform equipment 1,527,802 1,455,663 1,490,393 Less-than-truckload 95,856 99,828 117,683 Other truck transportation (1) 383,970 343,253 479,173 Total truck transportation 4,336,014 4,346,554 4,829,530 Rail intermodal 87,164 84,328 98,297 Ocean and air cargo carriers 241,433 289,902 266,638 Other (2) 79,149 98,461 108,857 $ 4,743,760 $ 4,819,245 $ 5,303,322 Revenue on loads hauled via BCO Independent Contractors included in total truck transportation $ 1,803,514 $ 1,821,989 $ 1,998,408 Number of loads: Truck transportation Truckload: Van equipment 1,124,539 1,170,772 1,259,578 Unsided/platform equipment 487,060 476,815 504,765 Less-than-truckload 151,518 153,253 175,650 Other truck transportation (1) 180,683 160,120 201,407 Total truck transportation 1,943,800 1,960,960 2,141,400 Rail intermodal 29,970 27,970 29,620 Ocean and air cargo carriers 31,120 34,440 32,820 2,004,890 2,023,370 2,203,840 Loads hauled via BCO Independent Contractors included in total truck transportation 798,050 814,150 898,610 Revenue per load: Truck transportation Truckload: Van equipment $ 2,071 $ 2,091 $ 2,177 Unsided/platform equipment 3,137 3,053 2,953 Less-than-truckload 633 651 670 Other truck transportation (1) 2,125 2,144 2,379 Total truck transportation 2,231 2,217 2,255 Rail intermodal 2,908 3,015 3,319 Ocean and air cargo carriers 7,758 8,418 8,124 Revenue per load on loads hauled via BCO Independent Contractors $ 2,260 $ 2,238 $ 2,224 Revenue by capacity type (as a % of total revenue): Truck capacity providers: BCO Independent Contractors 38 % 38 % 38 % Truck Brokerage Carriers 53 % 52 % 53 % Rail intermodal 2 % 2 % 2 % Ocean and air cargo carriers 5 % 6 % 5 % Other 2 % 2 % 2 % (1) Includes power-only, expedited, straight truck, cargo van, and miscellaneous other truck transportation revenue generated by the transportation logistics segment.
Fuel surcharges on Truck Brokerage Carrier revenue identified separately in billings to customers and included as a component of Truck Brokerage Carrier revenue were $147,691,000 and $211,770,000 in fiscal years 2023 and 2022, respectively.
Fuel surcharges on Truck Brokerage Carrier revenue identified separately in billings to customers and included as a component of Truck Brokerage Carrier revenue were $108,709,000 and $118,295,000 in fiscal years 2025 and 2024, respectively.
The Company declared and paid $1.10 per share, or $40,284,000 in the aggregate, in cash dividends during fiscal year 2022 and, during such period, also paid $75,387,000 of dividends payable which were declared during fiscal year 2021 and included in current liabilities in the consolidated balance sheet at December 25, 2021.
The Company declared and paid $1.56 per share, or $54,126,000 in the aggregate, in cash dividends during fiscal year 2025, and during such period, also paid $70,632,000 of dividends payable which were declared during fiscal year 2024 and included in current liabilities in the consolidated balance sheet at December 28, 2024.
Loads hauled via other truck transportation services decreased 37%, loads hauled via van equipment decreased 16%, loads hauled via unsided/platform equipment decreased 10% and less-than-truckload loadings decreased 8% as compared to fiscal year 2022.
Loads hauled via van equipment decreased 4% and less-than-truckload loadings decreased 1%, while loads hauled via other truck transportation services increased 13% and loads hauled via unsided/platform equipment increased 2% as compared to fiscal year 2024.
Long-term debt, including current maturities, was $102,307,000 at December 28, 2024, compared to $71,140,000 at December 30, 2023 and $103,400,000 at December 31, 2022. 35 Table of Contents Shareholders’ equity was $972,439,000, or 90% of total capitalization (defined as long-term debt including current maturities plus equity), at December 28, 2024, compared to $983,923,000, or 93% of total capitalization at December 30, 2023 and $887,221,000, or 90% of total capitalization at December 31, 2022.
Shareholders’ equity was $795,665,000, or 91% of total capitalization (defined as long-term debt including current maturities plus equity), at December 27, 2025, compared to $972,439,000, or 90% of total capitalization at December 28, 2024 and $983,923,000, or 93% of total capitalization at December 30, 2023.
It is reasonably likely that the ultimate outcome of settling all outstanding claims will be more or less than the estimated claims liability at December 28, 2024, primarily due to the inherent difficulty in estimating the severity of commercial trucking claims and the potential judgment or settlement amount that may be incurred in connection with the resolution of such claims.
It is reasonably likely that the ultimate outcome of settling all outstanding claims will be more or less than the estimated claims liability at December 27, 2025, primarily due to the inherent difficulty in estimating the severity of commercial trucking claims and the potential judgment or settlement amount that may be incurred in connection with the resolution of such claims. 42 Table of Contents Significant variances from the Company’s estimates for the ultimate resolution of self-insured claims could be expected to positively or negatively affect Landstar’s earnings in a given quarter or year.
The change in the number of Million Dollar Agents on a year-over-year basis is influenced by many factors and is not solely the result of terminations of contractual relationships between agents and the Company, whether such terminations are initiated by the agent or the Company.
Included among the Company’s Million Dollar Agents in the 2024 fiscal year, the Company had 81 independent sales agencies that generated at least $10 million in Landstar revenue. 28 Table of Contents The change in the number of Million Dollar Agents on a year-over-year basis is influenced by many factors and is not solely the result of terminations of contractual relationships between agents and the Company, whether such terminations are initiated by the agent or the Company.
Commissions to agents were 8.7% and 8.3% of revenue in fiscal years 2023 and 2022, respectively. The increase in commissions to agents as a percentage of revenue was primarily attributable to a decreased cost of purchased transportation as a percentage of revenue on revenue generated by Truck Brokerage Carriers during fiscal year 2023.
The increase in purchased transportation as a percentage of revenue was primarily due to an increased rate of purchased transportation on revenue generated by Truck Brokerage Carriers. Commissions to agents were 8.2% and 8.1% of revenue in fiscal years 2025 and 2024, respectively.
Revenue per load on loads hauled via ocean, air and rail intermodal decreased 40%, 35% and 7%, respectively, during fiscal year 2023 as compared to fiscal year 2022.
Revenue per load on loads hauled via rail intermodal and ocean decreased approximately 4% and 8%, respectively, while revenue per load on loads hauled via air increased approximately 14% during fiscal year 2025 as compared to fiscal year 2024.
Transportation revenue generated by rail intermodal, air cargo and ocean cargo carriers (collectively, the “multimode capacity providers”) for fiscal year 2024 was $374,230,000, or 8% of total revenue, an increase of $9,295,000, or 3%, compared to fiscal year 2023.
Transportation revenue generated by rail intermodal, air cargo and ocean cargo carriers (collectively, the “multimode capacity providers”) for fiscal year 2025 was $328,597,000, or 7% of total revenue, a decrease of $45,633,000, or 12%, compared to fiscal year 2024.
Since January 1997, the Company has purchased approximately $2,335,000,000 of its Common Stock under programs authorized by the Board of Directors of the Company in open market and private block transactions. As of December 28, 2024, the Company may purchase in the aggregate up to 2,547,981 shares of its Common Stock under its authorized stock purchase programs.
The Company has used cash provided by operating activities to fund the purchases. Since January 1997, the Company has purchased approximately $2,515,000,000 of its Common Stock under programs authorized by the Board of Directors of the Company in open market and private block transactions.
The increase in interest and debt (income) expense was primarily attributable to increased interest income earned on cash balances held by the transportation logistics segment, decreased interest expense related to finance lease obligations and decreased average borrowings on the Company’s revolving credit facility, as the Company had no borrowings during the 2023 fiscal year.
The increase in interest and debt expense (income) was primarily attributable to decreased interest income earned on cash balances held by the transportation logistics segment and increased interest expense related to finance lease obligations. The effective income tax rate was 23.6% for fiscal year 2025 and 23.0% for fiscal year 2024.
The decrease in the number of loads hauled by multimode capacity providers was due to a 27% decrease in rail loadings, a 23% decrease in ocean loadings and a 19% decrease in air loadings.
The decrease in the number of loads hauled by multimode capacity providers was due to a 12% decrease in ocean loadings and a 4% decrease in air loadings, while rail loadings increased 7%. The 12% decrease in ocean loadings was broad-based with decreases at several customers.
Costs of revenue The Company incurs costs of revenue related to the transportation of freight and, to a much lesser extent, to reinsurance premiums received by Signature. Costs of revenue include variable costs of revenue and other costs of revenue.
For additional information, see Note 16 in the “Notes to Consolidated Financial Statements” in this Annual Report on Form 10-K. Costs of revenue The Company incurs costs of revenue related to the transportation of freight and, to a much lesser extent, to reinsurance premiums received by Signature. Costs of revenue include variable costs of revenue and other costs of revenue.
Investment income was $10,141,000 and $3,162,000 in fiscal years 2023 and 2022, respectively. The increase in investment income was attributable to higher average rates of return on investments and a higher average investment balance held by the insurance segment during fiscal year 2023. Other operating costs increased $8,999,000 in fiscal year 2023 compared to fiscal year 2022.
The decrease in investment income was attributable to lower average rates of return on investments in fiscal year 2025, partially offset by a higher average investment balance held by the insurance segment during fiscal year 2025. 37 Table of Contents Other operating costs increased $2,805,000 in fiscal year 2025 compared to fiscal year 2024.
The effective income tax rate was 24.0% for fiscal year 2023 and 24.1% for fiscal year 2022. The effective income tax rates for both fiscal years 2023 and 2022 were higher than the statutory federal income tax rate of 21% primarily attributable to state income taxes and nondeductible executive compensation, partially offset by excess tax benefits realized on stock-based awards.
The effective income tax rate was higher than the statutory federal income tax rate of 21% for fiscal year 2025 primarily attributable to state taxes. The effective income tax rate was higher than the statutory federal income tax rate of 21% for fiscal year 2024 primarily attributable to state taxes, partially offset by federal research and development tax credits.
Included in selling, general and administrative costs was incentive compensation expense of $591,000 and $16,507,000 for the 2023 and 2022 fiscal years, respectively, and stock-based compensation expense of $4,282,000 and $12,399,000 for the 2023 and 2022 fiscal years, respectively. 34 Table of Contents Depreciation and amortization increased $700,000 in fiscal year 2023 compared to fiscal year 2022.
Included in selling, general and administrative costs was stock-based compensation expense of $5,998,000 and $3,435,000 for the 2025 and 2024 fiscal years, respectively, and incentive compensation expense of $3,625,000 and $1,970,000 for the 2025 and 2024 fiscal years, respectively. Depreciation and amortization decreased $10,350,000 in fiscal year 2025 compared to fiscal year 2024.
Many of these claims are covered in whole or in part by insurance.
The Company is involved in certain claims and pending litigation arising from the normal conduct of business. Many of these claims are covered in whole or in part by insurance.
The decrease in selling, general and administrative costs compared to prior year was primarily attributable to a decreased provision for incentive compensation, decreased stock-based compensation expense and a decreased provision for customer bad debt, partially offset by increased information technology costs and increased wages.
The increase in selling, general and administrative costs compared to prior year was primarily attributable to increased information technology project consulting fees, increased stock-based compensation expense, increased wages, increased legal fees, an increased provision for incentive compensation and increased employee benefit costs, primarily attributable to increased medical and pharmacy costs under the self-insured portion of the Company’s medical plan, partially offset by the impact of Chief Executive Officer (“CEO”) transition costs in fiscal year 2024.
The decrease in the number of loads hauled via truck compared to fiscal year 2022 was primarily due to a decrease in demand from the record high levels experienced in fiscal year 2022 for the Company’s van services and power-only services included in other truck transportations services, which tend to be more correlated with U.S. consumer demand.
The decrease in the number of loads hauled via truck compared to fiscal year 2024 was primarily due to decreased demand from fiscal year 2024 for the Company’s van and less-than-truckload transportation services.
During the 2023 and 2022 fiscal years, insurance and claims costs included $6,058,000 and $11,331,000 of net unfavorable adjustments to prior years’ claims estimates, respectively. Selling, general and administrative costs decreased $9,480,000 in fiscal year 2023 as compared to fiscal year 2022.
During the 2025 and 2024 fiscal years, insurance and claims costs included $32,082,000 and $8,824,000 of net unfavorable adjustments to prior years’ claims estimates, respectively.
The decrease in cash flow provided by operating activities for fiscal year 2023 was primarily attributable to decreased net income and decreased favorable net working capital impacts in connection with the timing of collections of receivables and payment of certain payables as compared to the 2022 fiscal year.
The decrease in cash flow provided by operating activities for fiscal year 2025 was primarily attributable to the impact of decreased net income (excluding the non-cash impact on net income relating to the impairment of intangible and other assets) and the timing of collections of receivables, partially offset by the timing of payments of insurance claims.
The increase in other operating costs compared to the prior year was primarily due to (i) increased trailing equipment maintenance costs as a result of the higher average age of the Company-owned trailer fleet and increased labor and parts costs charged by the Company’s network of third party trailer maintenance facilities and (ii) an increased provision for contractor bad debt, partially offset by increased gains on sales of operating property.
The increase in other operating costs compared to the prior year was primarily due to increased trailer equipment maintenance costs, partially offset by a decreased provision for contractor bad debt. Insurance and claims increased $45,507,000 in fiscal year 2025 compared to fiscal year 2024.
As a result, the consideration related to a gain contingency is recorded in the consolidated financial statements during the period in which all underlying events or contingencies are resolved and the gain is realized. Further, the Company retains liability of up to $2,000,000 for each general liability claim, $250,000 for each workers’ compensation claim and $250,000 for each cargo claim.
Further, the Company retains liability of up to $2,000,000 for each general liability claim, $250,000 for each workers’ compensation claim and $250,000 for each cargo claim.
The year-over-prior-year change in interest and debt (income) expense was $7,566,000, with net interest and debt income of $3,946,000 in fiscal year 2023 compared to net interest and debt expense of $3,620,000 in fiscal year 2022.
This was attributable to the impairment matters referenced above under “ Expenses – Impairment of intangible and other assets. ” The year-over-prior-year change in interest and debt expense (income) was $6,415,000, with net interest and debt expense of $996,000 in fiscal year 2025 compared to net interest and debt income of $5,419,000 in fiscal year 2024.
Since paying its first cash dividend in August 2005, the Company has paid approximately $965,000,000 in cash dividends in the aggregate to its stockholders, inclusive of the $2.00 per share special dividend paid on January 21, 2025.
Since paying its first cash dividend in August 2005, the Company has paid approximately $1,087,000,000 in cash dividends in the aggregate to its stockholders, inclusive of the $2.00 per share special dividend paid on January 21, 2026. 40 Table of Contents During fiscal year 2025, the Company purchased 1,281,863 shares of its Common Stock at a total cost of $180,901,000, including $179,139,000 in cash purchases and accrued excise tax of $1,762,000 which is included in other current liabilities in the consolidated balance sheet at December 27, 2025.
The 27% decrease in rail loadings and the 23% decrease in ocean loadings were both broad-based with particularly significant declines at a limited number of specific customers, while the 19% decrease in air loadings was primarily attributable to decreased loadings at one specific customer. Purchased transportation was 76.7% and 78.0% of revenue in fiscal years 2023 and 2022, respectively.
The 4% decrease in air loadings was primarily attributable to decreases at several specific customers. The 7% increase in rail loadings was primarily attributable to increased loadings at one specific agency. Purchased transportation was 77.8% and 77.7% of revenue in fiscal years 2025 and 2024, respectively.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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The revolving credit loans under the Credit Agreement as of December 28, 2024, at the option of Landstar, bear interest at (i) a forward-looking term rate based on the secured overnight financing rate plus 0.10% and an applicable margin ranging from 1.25% to 2.00%, or (ii) an alternate base rate plus an applicable margin ranging from 0.25% to 1.00%, in each case with the applicable margin determined based upon the Company’s Leverage Ratio, as defined in the Credit Agreement, at the end of the most recent applicable fiscal quarter for which financial statements have been delivered.
The revolving credit loans under the Credit Agreement as of December 27, 2025, at the option of Landstar, bear interest at (i) a forward-looking term rate based on the secured overnight financing rate plus 0.10% and an applicable margin ranging from 1.25% to 2.00%, or (ii) an alternate base rate plus an applicable margin ranging from 0.25% to 1.00%, in each case with the applicable margin determined based upon the Company’s Leverage Ratio, as defined in the Credit Agreement, at the end of the most recent applicable fiscal quarter for which financial statements have been delivered.
During all of fiscal years 2024 and 2023 and as of both December 28, 2024 and December 30, 2023, the Company had no borrowings outstanding under the Credit Agreement. Long-term investments, all of which are available-for-sale and are carried at fair value, include primarily investment-grade bonds and asset-backed securities having maturities of up to five years.
During all of fiscal years 2025 and 2024 and as of both December 27, 2025 and December 28, 2024, the Company had no borrowings outstanding under the Credit Agreement. Long-term investments, all of which are available-for-sale and are carried at fair value, include primarily investment-grade bonds and asset-backed securities having maturities of up to five years.
Assuming that the long-term portion of investments remains at $92,246,000, the balance at December 28, 2024, a hypothetical increase or decrease in interest rates of 100 basis points would not have a material impact on future earnings on an annualized basis. Short-term investments consist of short-term investment-grade instruments and the current maturities of investment-grade corporate bonds and asset-backed securities.
Assuming that the long-term portion of investments remains at $91,482,000, the balance at December 27, 2025, a hypothetical increase or decrease in interest rates of 100 basis points would not have a material impact on future earnings on an annualized basis. Short-term investments consist of short-term investment-grade instruments and the current maturities of investment-grade corporate bonds and asset-backed securities.
Adjustments resulting from the translation process are included in accumulated other comprehensive income. Transactional gains and losses arising from receivable and payable balances, including intercompany balances, in the normal course of business that are denominated in a currency other than the functional currency of the operation are recorded in the statements of income when they occur.
Transactional gains and losses arising from receivable and payable balances, including intercompany balances, in the normal course of business that are denominated in a currency other than the functional currency of the operation are recorded in the statements of income when they occur.
The assets held at the Company’s Canadian and Mexican subsidiaries at December 28, 2024 were collectively, as translated to U.S. dollars, approximately 4% of total consolidated assets. Accordingly, translation gains or losses of 15% or less related to the Canadian and Mexican operations would not be material. 38 Table of Contents 2.50http://fasb.org/us-gaap/2024#OtherAssetsNoncurrenthttp://fasb.org/us-gaap/2024#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#DeferredIncomeTaxesAndOtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2024#PropertyPlantAndEquipmentNet
The assets held at the Company’s Canadian and Mexican subsidiaries at December 27, 2025 were collectively, as translated to U.S. dollars, less than 2% of total consolidated assets. Accordingly, translation gains or losses of 25% or less related to the Canadian and Mexican operations would not be material. 43 Table of Contents 2.500http://fasb.org/us-gaap/2025#OtherAssetsNoncurrenthttp://fasb.org/us-gaap/2025#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2025#DeferredIncomeTaxesAndOtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2025#AssetImpairmentChargeshttp://fasb.org/us-gaap/2025#PropertyPlantAndEquipmentNet
Accordingly, any future interest rate risk on these short-term investments would not be material to the Company’s operating results. 37 Table of Contents Assets and liabilities of the Company’s Canadian and Mexican operations are translated from their functional currency to U.S. dollars using exchange rates in effect at the balance sheet date and revenue and expense accounts are translated at average monthly exchange rates during the period.
Assets and liabilities of the Company’s Canadian and Mexican operations are translated from their functional currency to U.S. dollars using exchange rates in effect at the balance sheet date and revenue and expense accounts are translated at average monthly exchange rates during the period. Adjustments resulting from the translation process are included in accumulated other comprehensive income.
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Accordingly, any future interest rate risk on these short-term investments would not be material to the Company’s operating results.

Other LSTR 10-K year-over-year comparisons