Saia Posts Record Revenue and Tonnage on 45-Terminal Expansion

Saia's third quarter brought record revenue and record tonnage, with the top line jumping 17% year over year to $983 million — $15 million ahead of analysts' expectations. Earnings per share of $3.41 beat the consensus by 11 cents and came in 60 cents higher than a year ago, helped by a $3.6 million decline in net interest expense worth about 10 cents. Last year's comparison excludes a $14.5 million net impact from real estate gains and impairments, which puts adjusted prior-year EPS at $2.81.

Not bad for a carrier that spent the past four years building rather than harvesting.

Where the volume came from

Tonnage rose 9% y/y, split between a 1% increase in shipments and 8% growth in weight per shipment. The monthly cadence accelerated through the quarter: up 7.8% in July, 8.7% in August and 10.3% in September. October is running 10% higher so far.

Two forces did the heavy lifting. Since 2022, Saia has opened 45 new terminals and relocated or expanded another 25, bringing the network to 219 doors. That's still smaller than rival national carriers, but management said the company is finally "on equal footing." Meanwhile, its Saia REV initiative has cut transit times in more than 2,000 lanes — an outlet management calls a source of "outsized volume growth." September also marked the ninth consecutive month of U.S. manufacturing expansion, a key wellspring of LTL freight.

What does this change for pricing?

Plenty, if you ship LTL. Saia implemented a 7.1% general rate increase on July 6 — 120 basis points larger and three months earlier than last year's hike — and says it "continues to see great results from that." Contractual renewals averaged 10.8% in the quarter, stacking to 15.9% over two years.

Yield per hundredweight, excluding fuel, still slipped 2% y/y, though heavier shipment weights and a 1% shorter length of haul worked against the metric. Revenue per shipment ex-fuel rose 6% despite softness in Los Angeles, a market that typically carries higher freight bills. Management argues its national footprint and better service can now close the pricing gap with peers.

"Frankly, the service levels that we've been providing … support that," President and CEO Fritz Holzgrefe told analysts on Thursday's call.

Margins held better than seasonal norms

The operating ratio landed at 87.6% — flat y/y and just 70 bps worse than the second quarter, against a normal 150-to-200-bps seasonal slide. Two wage increases hit the quarter, versus none a year earlier, and the newer terminals are still running in the low-90s OR, though 40 bps better y/y.

For the fourth quarter, Saia expects only 200 bps of deterioration versus the usual 250 to 300, implying an 89.6% OR — some 230 bps better than last year's unadjusted figure.

Purchased transportation costs rose 210 bps as a share of revenue. Rail and truck partners covered 15.7% of linehaul miles, and Saia held outside rate-per-mile inflation to 4%. It expects more cost inflation ahead but noted its provider contracts are staggered, and it will keep leaning on railroads' cost advantage.

Cash is coming home to shareholders

With the build-out largely done, Saia announced a $250 million share repurchase program on Thursday. Net capex guidance for this year was trimmed to $350 million from $350-to-400 million, down sharply from $544 million in 2025 and $1.05 billion in 2024. Next year, capex should run 13% to 14.5% of revenue, with 12% to 15% the long-term target.

The company generated more than $240 million in free cash flow through three quarters and ended with over $100 million in net cash. Investors approved: SAIA shares rose 3% by Thursday afternoon while the S&P 500 slipped 0.6%.

The next test is whether the new terminals can grind their way from low-90s ORs toward the corporate average — that's where the earnings leverage now sits.