TFI International: Supply-Led Truckload Pivot Lifts Q2, LTL Pricing Fix Underway
TFI International’s second-quarter earnings were a clear inflection point. Adjusted EPS of $1.85 came in well above the $1.50–$1.60 guidance range and climbed 38% year over year, driven by double-digit operating income growth across all three segments. As CEO Alain Bedard put it, “the investment we made during the recent slowdown, both in internal operation and strategic M&A are beginning to benefit our performance.” — Alain Bedard, President and CEO · 2026-07-27 The quarter also produced over $200 million of free cash flow, further strengthening a balance sheet that ended June at 2.4x funded debt to EBITDA.
The Truckload Supply Shock Is Real
The most compelling narrative is in the truckload segment, where operating ratio improved by 400 basis points year over year to 86.1%. Revenue per truck per week, excluding fuel, surged 13%, and importantly, the acceleration was visible inside the quarter. CFO David Saperstein noted, “we saw the pricing or the revenue per truck accelerate throughout the quarter. So in April, we were at 11.1% revenue per truck per week year-over-year growth that increased to 13.3% in May, and it was 14.4% in June.” — David Saperstein, Chief Financial Officer · 2026-07-27 The driver is structural, not cyclical. Alain highlighted regulatory changes—CDL enforcement, English proficiency requirements, and the ongoing crackdown on Driver Inc. in Canada—as forces that are permanently reducing capacity. He observed, “What I like about this, which I've never seen before in 30 years being a trucker, okay, is now it's the supply, right?” — Alain Bedard, President and CEO · 2026-07-27 This is not a demand spike but a tightening of capacity, and management believes it will hold.
The company is also benefiting from its own operational decisions. Depreciation fell $12.5 million in the quarter alone as they trimmed excess equipment from the Daseke fleet. Combined with a 35% increase in brokerage revenue, the segment is delivering what management calls “do more with less.” The asset-light shift is deliberate, and it shows in the brokerage revenue growth, a trend that should persist into 2027 as they consolidate the legacy Daseke companies into a single operating platform.
LTL: The Pricing Challenge
If truckload is the star, LTL is the work-in-progress. Volume grew strongly—shipments up 7.5%—but revenue per shipment fell 2%, and management admits they were “the cheapest guy in the country” for 3PL blanket freight. David Saperstein explained the problem bluntly:
The fix is already underway: a new pricing software (the same one used by peers) is replacing the outdated UPS Freight system, and the finance team is using AI to isolate problematic lanes and customers. Alain added that the 3PL blanket business—now over a third of LTL—was a deliberate mistake, and the commercial team is “fixing that now as we speak.” The expectation is that volume will moderate as price rises, and the segment's pricing action should restore margin discipline by year-end.Because what we're seeing on the LTL, the reason that the margins are expected to be flat is because we have too much volume and not enough price. And that's what we're working on fixing, okay? So that's a specific thing. I don't know if that's really to be extrapolated to the market or not. It's related to us. And of all of the issues to have, it's probably the one that we -- it's clear what to do. And we know that we just need to raise the price, and we're working on that.
Structural Change and M&A Optionality
Looking ahead, management guided Q3 adjusted EPS to $1.70–$1.80, implying a 50% year-over-year increase at the top end, with continued truckload margin improvement (500–600 bps OR), and logistics gains driven by the truck moving business and recent acquisitions. The LTL segment is expected to remain flat as the pricing work takes hold. The full-year CapEx range is unchanged at $225–$250 million.
The balance sheet also provides optionality. With leverage down to 2.4x and free cash flow generation robust, the company is “on the hunt” for M&A, but with discipline. Alain reminded investors, “you buy bad news and you sell good news.” — Alain Bedard, President and CEO · 2026-07-27 They are also eyeing autonomous trucking, with a pilot in LTL line-haul via a brokerage model and potential ownership of technology next year. That could fundamentally reshape the economics of the industry—and TFI wants to be ahead of it.
What changed? The cycle has turned, but this time the supply side is the driver, making the improvement more durable. TFI's revenue per truck is now climbing at double-digit rates, and the company is simultaneously fixing a self-inflicted LTL pricing problem. If the LTL fix sticks, and the structural tailwinds continue, the earnings power of this franchise is significantly higher than current levels—and management has the balance sheet to act on it.