Good afternoon. Thank you for attending today's J.B. Hunt Second Quarter 2022 Earnings Conference Call. My name is Amber, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I now have the pleasure of handing the conference over to our host, Brad Delco, Senior Vice President of Finance with J.B. Hunt. Brad, please proceed. Good afternoon. Before I introduce the speakers, I would like to take some time to provide some disclosures regarding forward-looking statements. This call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as expects, anticipates, intends, estimates, or similar expressions are intended to identify these forward-looking statements. These statements are based on J.B. Hunt's current plans and expectations and involve risks and uncertainties that could cause future activities and results to be materially different from those set forth in the forward-looking statements. For more information regarding risk factors, please refer to J.B. Hunt's annual report on Form 10-K and other reports and filings with the Securities and Exchange Commission. Now, I would like to introduce the speakers on today's call. This afternoon, I am joined by our Chief Executive Officer, John Roberts, our Chief Financial Officer, John Kuhlow, Shelley Simpson, Chief Commercial Officer and Executive Vice President of People and Human Resources, Nick Hobbs, Chief Operating Officer and President of Contract Services, Darren Field, President of Intermodal, and Brad Hicks, President of Highway Services. At this time, I would like to turn the call to our Chief Executive Officer, Mr. John Roberts, for some opening remarks. John? Thanks, Brad, and good afternoon. Thank you for joining our call today. We are pleased with our performance in the second quarter despite challenges around key factors of our business, including labor, equipment availability, and rail service. The quarter did present evidence of a cyclical shift in market balance in certain areas of our business, and we see macro data that informs us about our current position, such as spot rates and used truck values. That said, and most importantly, our results for the quarter continued to reveal the changes we have worked to implement to enhance our position in each segment of the company based on lessons learned and experiences gained over many, many years and cycles. There are different characteristics of our business segments that should be complementary to the needs of our customers in all economic conditions. These include a flexible, much lighter asset position in our Highway Services offerings, compelling solutions for private fleet conversions aiding in the nuances of managing advanced transportation networks, a more economical and carbon-friendly full load services offering in Intermodal, and a final mile delivery position that addresses a secularly growing demand channel. We remain in a leadership position across our many businesses and from a position of strength financially and on the team's experience and ability to navigate through an ever-changing, constantly evolving global supply chain. I am encouraged to be in healthy cash-generating businesses across the company. Let me address the clear service challenges we are experiencing with our rail providers. We are in active discussions with the highest levels of our primary rail providers to continue our work on improving service reliability and velocity. We remain confident that the right decisions and investments will be made to bring us back to where we need to be. We remain committed to the path we are on with intermodal and have made no changes to our plans with the expectations for the noted improvements to show through in the second half of this year. In fact, at this point, we have made no alterations to our plans for the year in our equipment and capital expenditure allocations. While we acknowledge there are timing and delivery challenges, we take a long view and know that we have extended needs in all categories for replacement and growth assets. This position recognizes so-called crosswinds we are experiencing as noted and will be covered more during this call. Our direction is fully informed using real-time data on all key aspects of each business and input from our customers. Our leadership team is here and will cover each business more specifically for you. Before that, I will turn the call over to our Chief Financial Officer, John Kuhlow, for his thoughts on the quarter. John? Thank you John, and good afternoon everyone. My comments today will review our recent performance in the quarter on a consolidated basis, and I'll also provide a quick update on our CapEx plans and our priorities for capital. Overall, we are pleased with the strong results the team was able to deliver in the quarter, highlighted with revenue growth of 32%, operating income growth of 46%, and GAAP earnings per share growth of 50%. We did incur two large but partially offsetting income statement items in the quarter. First, we incurred a $30 million increase in casualty claims, which is recorded in the insurance and claims line of our income statement. Second, we recorded a $11.6 million workers' compensation insurance benefit in the salaries, wages, and benefits line. We've discussed the net impact of $18.4 million in our release and provided the net impact by segment in those respective sections. We're equally pleased with our efforts in continuing to maintain a strong balance sheet with leverage below our net debt target of 1x EBITDA on a trailing 12 month basis. We ended the quarter with $124 million of cash and zero drawn on our revolving credit facility. You'll note our $350 million 2022 notes mature in the coming quarter, and we are reviewing our plans to retire these notes, but are not concerned on liquidity matters given our options. On CapEx, we continue to be slightly behind our plan of $1.5 billion that we forecasted for the year. As John alluded to, we remain committed to that target for both replacement and growth needs to service and grow with customers. The lagging CapEx versus plan is almost entirely due to challenges in obtaining equipment. As a reminder, our priorities for our capital remain focused on building long-term sustainable value for our shareholders, customers, and our people. We are able to accomplish this by remaining disciplined and allocating our capital to generate fair and reasonable returns to support reinvestment in our business, which remains priority number one. We bought back almost 1 million shares of stock in the quarter as opportunities were presented and remain committed to buybacks and dividends as a capital management tool as supported by our board. This concludes my remarks, and I'll now turn it over to Shelley. Thanks John, and good afternoon. My commercial update will cover current market conditions and how we continue to have confidence in our position across our suite of services to provide value for our customers. I'll also provide an update on our priorities across the key areas of our business, which are our people, technology, and capacity, and how the combination of all three allow us to differentiate ourselves in delivering exceptional value to our customers. The freight market remains dynamic and continues to be presented with unique and evolving challenges at different cross-sections of the broader supply chain. Labor availability, network velocity and fluidity, in addition to varying inventory dynamics around product mix, continue to put strain on the effective utilization of available capacity. Some trends we identified last quarter, like a softer transactional spot market, remain, but what also remains is a healthy demand for our intermodal capacity and our professionally outsourced private fleet solution in DCS and the frictionless way we connect customers with capacity in our highway services businesses by leveraging our J.B. Hunt 360° platform. The businesses we are in today across our entire portfolio were not built or created overnight. Careful thought, planning, and execution with durability, strength of financial discipline were and remain top of mind. We do recognize that broader demand trends are a concern, and we continue to have frequent and open dialogue with our customers regarding their capacity needs. We remain optimistic on our ability to compete to deliver the best value to our customers by offering a full suite of services across the supply chain that can help eliminate waste, create efficiencies, and drive out costs from the system. Last quarter, I said our opportunity to provide and create efficiencies for our customers is greater this year than at any point over the last two, and that remains true today. Freight has been moving inefficiently, creating additional costs, and we continue to see tremendous opportunity to eliminate waste in the system. Enhanced visibility, powered by the largest multimodal digital freight platform, J.B. Hunt 360°, remains a tremendous opportunity for customers to effectively source the capacity needs. During the quarter, we launched new foundational principles that helps define who we are as a company, what we strive for on behalf of our customers, and what our employees should expect as a member of our organization. In fact, our innovative, entrepreneurial, and say-do culture is founded on these principles, people you trust, technology that empowers, and capacity to deliver. That is J.B. Hunt. It is by no accident that people comes first as it is, and remains our top priority to take care of our people who take care of and deliver value for our customers. We empower our people, our organization, and our customers with investments in technology to help provide productivity and efficiencies in our collective processes. Finally, we continue to invest in our capacity to deliver on meeting the growing needs of our customers. I'll close in a similar fashion as I did last quarter. We believe our mode and different approach allows us to provide flexible solutions to dynamically meet and respond to the needs of our customers. Our investment in our people, technology, and physical capacity have us in the best position to provide the right solutions for our customers in the three key areas of cost, capacity, and service. That concludes my comments, and I'd now like to turn it over to Nick. Thank you, Shelley, and good afternoon. I'll review the performance of our dedicated and final mile segments and provide an update on our professional drivers and equipment and the impact it is having on our operations. I'll start with Dedicated. Demand for our professional outsourced private fleet solutions remains strong, as evidenced by our continued growth in our fleet during the quarter. Our backlog and pipeline also remain strong. After selling 600 trucks in Q1, we sold slightly over 800 trucks in the second quarter. We talked last quarter about seeing solid momentum in the business, and that remains the case today as we continue to onboard new business. We've added nearly 2,200 trucks to our business in the last 12 months, which continues to stand out versus the competition. This unprecedented demand and growth for our highly engineered fleet service has put a strain on the organization, and the team has responded extremely well to the challenge. Going forward, we will remain focused on operational excellence, attracting and retaining the best talent, and executing our growth plan, which all supports the value we deliver to our customers. Shifting to final mile. As we discussed earlier this year, our focus for 2022 has been on revenue quality and making sure our investments in our differentiated service product is properly valued in the marketplace. I am pleased with our efforts and the success we have had so far to improve our profitability. More work remains and remains a priority moving forward. We continue to see strong demand for our service with new customer opportunities in the pipeline. We also have seen some softening demand in some end markets, mainly in the value furniture category. Our recent acquisition, Zenith Freight Lines, is performing well and is presenting good opportunities for future growth. Zenith contributed about $28 million of revenue in the quarter. Going forward, we will remain committed to providing an unmatched service in the industry, and we continue to make investments to support that effort. We believe this will support our long-term performance in this secularly growing piece of the supply chain. Closing with some general comments on operations. The driver market remains competitive and challenging, but it feels more stable than it has in a while, but at considerably higher cost. That said, the equipment market remains extremely challenging, and we are having to manage intensely around the impact on our operations. To support our replacement needs and the growth we've seen across our organization, we will be holding trades on roughly 4,000 tractors this year. Additionally, inflationary cost pressures on tires, parts, maintenance technicians are meaningful, and the higher frequency of repairs as a result of an aging fleet is also impacting the utilization of our tractor equipment. We continue to work closely with our OEM providers to secure the safest and most fuel-efficient equipment we can in the most expeditious way possible. That concludes my remarks, so I'll turn it over to Darren. Thank you, Nick, and good afternoon, everyone. I'll review performance of our Intermodal segment. I will also give you an update on current network dynamics, customer demand, and capacity. I'll start by reviewing the performance of the Intermodal segment in the quarter. Demand for our capacity continues to be greater than our ability to serve that demand. After seeing modest improvements in both rail velocity and customer activity in the first quarter, we saw performance deteriorate throughout the second quarter. Box turns in the quarter were essentially flat versus the first quarter and underperformed our expectations. That said, volumes by month for the quarter were up 4% in April, up 9% in May, and up 10% in June on a year-over-year basis. We took delivery of an additional 1,300 containers in the quarter and expect to take delivery of more in the second half of the year as we continue to invest in capacity to meet the needs of our customers. While our network velocity and resulting volume performance were disappointing in the quarter, the system and programs we have in place continue to protect the significant investments we've made on behalf of our customers. As we sit here today, we remain optimistic that rail performance and velocity will improve as the rails are not incentivized to move slower. Near- and long-term growth opportunities for our Intermodal business continue to be in front of us, and our rail channel partners are well aware of those opportunities. As John mentioned, we are working closely with all levels of our rail channel partners to address the velocity challenges. Starting early next year, as new capacity becomes available to us on BNSF, we fully anticipate filling that available capacity, which is supported by feedback from our customers. When rail velocity does improve, we fully expect to improve available capacity but also demand for that available capacity as service levels improve. As inefficiencies are removed from the network, we fully expect that to be reflected in our cost to serve customers, and rightfully so, in the cost to our customers. In closing, our Intermodal product continues to present a strong value proposition to customers with significant capacity to serve their needs in a more sustainable, efficient, and carbon-friendly way. We will continue to prioritize investments needed to support our long-term growth and to better serve our customer needs. We believe our service, backed by our people and the ownership of our equipment, is differentiated in the market, and even more so when combined with the power of the J.B. Hunt 360° platform that allows us to source capacity efficiently when needed. That concludes my remarks, so I'll turn it over to Brad Hicks. Thank you Darren, and good afternoon, everyone. I'll review the performance of our integrated Capacity Solutions and Truckload segments, what we collectively call Highway Services. While we did see a market shift in the quarter, specifically related to spot opportunities, we believe our investments in our people, technology, and assets helped us deliver a great and demanded service from our customers, which I'll touch on at the end of my comments. First, let's dive into ICS. ICS top-line revenue growth was 3%, comprised of a 3% decline in volume, more than offset by a 5% increase in revenue per load. Unpacking that a little more, our truckload volumes were also down about 3%, but this was largely a function of the shift I referenced earlier. Our contractual truckload business increased in upper teens% year-over-year, while our spot business was down mid-teens% on a year-over-year basis. We made a call earlier this year to focus on the published side of our business, which we believe was the right strategic move. That said, we did adjust the dials mid-quarter on some of our platform parameters and saw improvement in spot rated freight trends as the quarter progressed. We will continue to target the right and appropriate balance between volume growth and profitability, and our goal remains to outperform industry trends over the long term on growth. More importantly, on delivering value to customers. I am confident with the power of our people and the technology investments in our. J.B. Hunt 360° platform to drive increased efficiency and value in our service offering to help us deliver on our mission to create the most efficient transportation network in North America. Shifting over to truckload, we continue to see evidence of our customers valuing our drop trailer network service offering. Volume growth of 14% in the quarter supports that view. We see tremendous opportunity as customers begin to think differently about the blending of their live network and drop trailer network capacity needs. We believe that we have the right experience managing trailer assets in a complex network business. We've gained that experience in our intermodal business. In this instance, leveraging all the capacity and capability of our J.B. Hunt 360° platform to source the most efficient capacity for our customers versus the rail network. This shift from an asset-intensive to an asset-light model supports our goal of scaling a large business with fair and acceptable rates of return on our capital. In closing, I would just like to reiterate our strong belief that the blending of what has historically been separate networks, live load and unload freight versus drop trailer freight, remains in strong demand and is valued by our customers. We remain committed to investment in our people, technology, and assets to support this growth. That concludes my comments, so I'll turn it back to Brad to give some instructions before the operator opens the call for Q&A. Thanks, Brad, and I just want to remind the audience, if you don't mind, please ask one question and get back in queue. We have a lot of folks on the call this afternoon. With that, I'll turn it back to the operator, Amber. Thank you. Of course Thank you. We will now begin the Q&A session. If you would like to submit for a question, please press star followed by one on your telephone keypad. If for any reason you would like to remove that question, please press star followed by two. Again, to submit for a question, that's star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question. We will pause here briefly as questions are registered. Our first question comes from Todd Fowler with KeyBanc. Todd, your line is now open. Hey great Thanks, and good afternoon. So I guess maybe to start, I don't know if this is for Shelley or maybe John Roberts, if you wanted to take a stab at this, but maybe to help level set kind of some of the commentary that you have around the demand environment. You know, certainly we appreciate that there's a lot of crosscurrents that are out there. You know, as you think about the progression into the second half of this year, I'm just curious, are the indications that you're expecting a weaker environment in the second half relative to where we were in the first half based on customer feedback? You know, any color around the fall peak would be helpful. Any potential you know, pricing conversations or impact on pricing, based on the change in demand environment right now. Thanks. Okay Thank you Todd. I think you gave me three questions. I'm going to do my best to answer them as best as possible. We're having great conversation. That was Todd Fowler, so. We are having really good conversation with our customers, but I think not unlike what's happened in the pandemic the last two years, there is continuing to be challenges in the supply chain that are creating uncertainty in the market. In particular with our customers around inventory, which is really generated from consumer behavior, but just also the bottlenecks that are occurring from port activity to, we talked in our last call what was happening coming out of China, and then certainly what's happening still with labor, at each part of the supply chain in general. I would tell you, I think we're having a seasonally normal July. That might be the first July that we've seen in a seasonality perspective since COVID had started. We do think that there will be a peak. To what extent, we're still not sure. We feel confident in the different areas of our businesses and how we're having conversation with our customers. If I were to think about from a pricing perspective, we're pretty much finished with bid season, and we're going to be entering into new bid season here in a couple of months. Our pricing is pretty much set across all of our businesses, except for what's happening in the spot market in total. I think our customers are trying to understand what's happening in cost. I have talked about our transitory costs versus our structural cost challenges, and we are trying to get them up to speed where there is transitory costs, and we can start helping them create a more efficient supply chain. You know, I think it's. We haven't even started bid season and what's coming in the next couple of months, but I would say I think our customers are prepared to have a good second half. I haven't had a lot of feedback on a significant downturn. I will say inventory has had some short-term challenges and changes for our customers going all the way upstream in the supply chain, but those are supposed to be more short term than they are long term. Nick, did you have something to add? Yeah, I was just going to say, in our dedicated business, as we watch our load count in the day, which is basically from the warehouse to the store, our volume is up and trending up. It's looking good from that standpoint. We're still seeing consumer demand strong, and we're closest to that. Great. Thanks for the color. Thank you. Our next question comes from Ken Hoexter with Bank of America. Ken, your line is now open. Hey great good afternoon Just, Darren, I guess great job on intermodal. Maybe can you talk a bit more about the rail service and if loads are up 8% while their service levels, I think you said were flattish, how we should think about that. Are you starting to see an improvement? You know, your thoughts on outlook into the second half as you go into peak. Then same thing on price, right? Can you delineate maybe the excess pricing from that poor rail service? Because you mentioned as the service gets better, you could see pricing then come down for customers. Maybe talk about how we should think about that, in terms of the price impact. Thanks. Well let me start on service. You know, we talked about velocity actually deteriorated some during the second quarter. We know that none of our rail providers are satisfied with their operations today. I think the intensity at all of our rail providers is extraordinarily high today in all efforts to onboard new crews and find a pathway to a better service product. I think that collectively, us and our rail providers all understand that there's additional demand, additional revenue, additional volume waiting on us to improve our service. I think that that's universally understood, and I do anticipate that we're going to see some improvements during the second half of the year. The key question is when, and you know, I don't have a great answer for that. I mean, I really think the railroads will have to answer that question. But we're confident in the programs they're initiating, and we are confident that they will see improvements as the year continues. I think all we tried to highlight on the pricing front is you know, there's accessorial programs out there for delays at customers. Those certainly are areas where that's cost to remove from the customers as velocity improves. But in addition to that, equipment ownership is not cheaper today. It's more expensive than ever to buy equipment. When the rail velocity improves, really our industry, I would think J.B. Hunt and all intermodal channels will have a slight pickup in equipment cost there, and certainly we would anticipate at least some of those would be passed along to the customers. Great. Appreciate the time. Thank you. Thank you. Our next question comes from Allison Poliniak with Wells Fargo. Allison, your line is now open. Hi good evening. Can you touch on, you know, with J.B. Hunt 360°, where you think we are in like growth and evolution of that product offering, particularly as we think through that downside scenario? Somewhat associated with that within ICS, you know, kind of similarly, how we should think about that gross margin range through cycles? Just any thoughts there? Yeah Allison this is Brad Hicks. Thank you for the question. You know, when I think about J.B. Hunt 360°, we're very public about the investments we made in 2018 and 2019, really leading into 2020. We do continue to invest in J.B. Hunt 360° to expand its capabilities and the value that it can create on behalf of both our customers as well as our carriers. But by and large, I guess, the foundation of that platform, I would say, is behind us. But that's not to say that we won't continue to make investments and find ways to improve upon it. Remind me again, part two of your question. Just within ICS, is there a gross margin range that we should be thinking through you know, particularly as we think about that downside scenario, just for that segment around. Yeah Certainly. Thank you for the reminder. You know we certainly saw margins expand dramatically in the second quarter with the pressure that had been placed predominantly in the spot and where we were at relative to the bid cycle with published rates. You know, is that the peak? Hard to say, and I think it's still too early to tell. Certainly PTL has come down, but it is still well north of historical or pre-COVID levels. Obviously, Shelley mentioned there are some structural costs that probably remain, but you know, we'll just have to see what the second half holds around capacity versus supply. Certainly we were able to take advantage of the expanded margins, as you can see in our results for the second quarter. We were pleased by that and feel like we managed through that pivot in an appropriate way. Great. Thank you. Thank you. Our next question comes from Ravi Shanker with Morgan Stanley. Ravi, your line is now open. Thank you. Good afternoon, everyone. Thanks for the time. The insurance claim that you had is $30 million in the quarter. Can you elaborate on that a little bit more and help us understand if this was a one-time thing related to the quarter alone or some kind of incident, or is it an ongoing item? Thank you. Hey Ravi this is John Kuhlow. I'll address the one-time charge. We tend to try to avoid calling, referring things as one time, but this one was a charge that we had incurred in the quarter for claims that result or were part of a prior year. There were two or three claims that are going to settle or have settled outside of our coverage limits in one of the towers. Again, everything is part of the business, but these related to prior periods. Great. Thank you. Thank you. Our next question comes from Scott Group with Wolfe Research. Scott, your line is now open. Hey thanks Afternoon. As you start planning for the upcoming bid season, would you expect to see a divergence in intermodal and truckload pricing or would you think that they would sort of trend directionally together? Then maybe just separately for Nick on the dedicated side. The growth really kicked in in second quarter last year. I'm just wondering, a year later, all those trucks that you added, how are those performing relative to the margin targets? Yeah Okay Scott, Darren here, I'll handle intermodal first. You know, I think certainly this massive change in spot prices that's evident out there feels like it is putting a little bit of pressure on intermodal. I don't know that I think it's this overwhelming influencer as highway capacity is still not typically the largest competitor to intermodal out west. Typically, we're competing against all water costs or certainly other intermodal channels or intact channels. Those costs will drive the intermodal market, and then the underlying rail cost are gonna be the biggest influencers, far more than what is going on with truckload pricing. Now in the east, certainly highway rates can play in a real influence on our ability to convert business off the highway to intermodal. All that being said, with fuel prices where they are and with velocity being challenged to this point, I think we feel like preparing for the next round, we should see velocity improvements, which can translate to value for customers that intermodal can provide when compared against the highway. I think there will be some convergence, meaning if trends in highway published prices are to trend flat or certainly slow or even take a tick down, certainly the intermodal market will have to respond. I think the cost, the underlying cost structure of intermodal, really for all the channels, is a little bit different than what it is on the highway. Yeah Scott this is Brad. I would just mention maybe from a highway standpoint, I think it would be safe to anticipate that there would be flat to downward pressure, at least in the shorter term. You know, what does that mean going into all of 2023? I think it's entirely too early to really tell. I think that we'll know a lot more as we get deeper into fall in terms of understanding what demand looks like relative to supply, but certainly would anticipate maybe some flat to down pressure from a pure highway standpoint. All right Scott this is Nick. To your question, I'm looking at the entire book of 21 adds for us, and it's operating within 20 basis points of our base business that's been around for a long time. It is doing very well. That's including deals that started up in November and December. We're very pleased with that, and it's hitting our targets. Thank you, guys. Thank you. Our next question comes from Christian Wetherbee with Citi. Chris, your line is now open. Hey thanks. Maybe a question for Darren. Wanted to get a sense of intermodal container additions through the rest of the year. Is 2Q sort of a good proxy to use for quarterly growth going forward? You know, maybe bigger picture, are there challenges to continuing to add to the fleet if rail service doesn't get better? You know, obviously, you've been pretty successful adding to the fleet, and we haven't seen really much improvement in rail service, so maybe that's the answer. Kinda curious about how you think about, you know, continuing to grow the fleet. You know, if we're not gonna get a pickup here over the course of the next several months or into the back half of the year, are there other challenges or cost dynamics that start to crop up as a result of that? Thanks. Sure w ell, we ended the quarter just above 110,000 containers, and we're off and marching on our announced plan to expand our capacity up to 150,000 over the next three to five years. With only 1,300 adds in Q2 of this year, I think we would fall well short of that plan if that is what we do. As velocity changes come about and there's opportunities for us to gain capacity with the equipment we already own, we will adapt our pace of onboarding that equipment based on customer demand and what's going on in the market. I don't wanna say that it's just gonna be steady flow and will always be exactly the same. I don't think it will be. You know, it would be certainly our opportunity to try to grow into new capacity that came from velocity improvements. At this point, probably announcements related to our equipment will continue to just land on that march towards 150,000. Obviously, each quarter you'll be able to see what we added. We would prefer it to be steady, but at the same time, we have to adapt, and we know that. ROIC will always be our North Star and will guide us through that process. We'll continue with the flexibility that we need to be prudent with as stewards of those investments. Hey Chris, it's Shelley. Just one thing to note there. We do have a unique opportunity in January where we will have more capacity on our western railroad provider. I think we're trying to equally balance, you know, the challenges of getting more intermodal containers to move in the system and the opportunity that will be present here in short order. Our conversations with customers are going well around the Western network, and so for us, we'll be more surgical as to where we can grow. If I think about our performance in the second quarter, we did a really great job, even through the challenges, growing with our customers on lanes that made sense for the railroad, for our customer and ourselves, and we'll continue to do that. I think it's going to be important that we continue to onboard equipment as we see room for growth for ourselves. Okay. Got it. Thanks so much. Thank you. Our next question comes from Amit Mehrotra with Deutsche Bank. Amit, your line is now open. Thanks operator. Hi everyone. I guess I just had a couple quick questions. One is, wanted to understand the implications from AB5, potentially being implemented. My feeling is as it relates to the intermodal business, it could be a pretty decent market share opportunity given, you know, you insource a vast majority of your, of the drayage drivers. I think your competitors do not. If you can just talk about if AB5 is implemented, or executed, you know, what the implications are for the industry overall, and specifically how J.B. Hunt's positioned in that. Dan, I was hoping you could update us on, you know, the joint initiative with BNSF. I saw the transload facility I think you guys put up a few days ago in a press release. Would just love to get an update on what BNSF, the progress that they've made in terms of giving you a little bit more clearer access to capacity, if that's being implemented now, or is that sort of more to come that can maybe drive a step function improvement in the turns and the volumes? Yeah Amit, this is Nick. I'll take the first on AB5, and we've been watching that since basically 2018, and we feel like we're in a really good spot with that. We don't expect the new law to have an immediate or material effect on our California operations. We've discontinued a few years ago our use of independent contractors operating under our authority. Out there, we provide either J.B. Hunt employees or we use brokerage to other motor carriers. We feel very confident that it's not gonna interrupt our business and probably play into our strength, particularly out in the intermodal side. Yeah. Amit, I think I heard you say that you thought that we outsource more of our drayage activity than the industry. No, insource. Yes you did. I'm sorry. I didn't hear that right. Just gonna clean that up if I didn't hear that right. Yeah. Appreciate you. Yeah, we don't feel like AB5 is gonna be an influencer of our operation in any way. As it relates to all things joint efforts with BNSF, I think that our mission today continues to be probably more focused on elements beginning next year. I mean frankly there's not new capacity announcements that have come from BNSF yet. As soon as something like that is available, I'm sure you'll read it. We still feel very confident in the way that we are communicating with BNSF on all things capacity. I think that you should all anticipate and expect that right now, we're very focused on seeing velocity improvements and just service improvements in our system, and that's dominating our conversations today. Got it Okay. Thank you very much. Appreciate the time. Thank you. Our next question comes from Jon Chappell with Evercore. Jon, your line is now open. Thank you. Good afternoon. Nick, I think this question's for you, but others can chime in as they see fit. I mean, you have a pretty unique look at two massive parts of the transportation chain with rail and truck. On the one hand, you still have this elevated contract rate and this very high fuel. On the other hand, you've had spot turning over and these rail service issues. I know we're hopeful for velocity improvements. I think we were very hopeful of that in April as well. As you look at your mode in different way of servicing customers, is there a point where maybe you're concerned that the intermodal, you know, kind of permanent modal shift has missed this opportunity, missed this window? If so, how do you kind of position all the different segments of J.B. Hunt, whether that's with capital dollars or labor, et cetera, to kind of, you know shift gears pretty quickly if intermodal is never gonna really dream the dream? Well John this is Shelley. I have a higher voice than Nick, but I would say you know our opportunity with our customers, we are mode indifferent. Understanding their needs specifically is important in how we develop what our strategy is and how we deploy capital as a result, much like what John Kuhlow talked about in his opening remarks. You know for us, we think that intermodal will continue to deliver great value for our customers, and we're bullish on our growth plan in our intermodal segment, but we're bullish in our growth plan across all of our segments over the long term. You know for us we think that there are some short-term pains that have felt longer term, but we do think that there is you know a window of opportunity here where the rails will get better, our customers will get better inventory will get to right locations, and the supply chain will start to find a better balance, if you will. We think having all five of our segments that really take product from the very beginning of the supply chain all the way in to the final home of our consumer will yield ourselves well in an environment that is more normalized. For our customers, we'll be able to say yes anytime that they need it. Each one of those segments have different margin targets and returns inside their own area, but we do see great growth across all five channels, and intermodal being one of our strongest growth vehicles over the next several years. Okay. Thank you, Shelley. Thank you. Our next question comes from Justin Long with Stephens. Justin, your line is now open. Thanks. With the significant run-up in fuel prices we've seen recently, I was curious if you could share how much of a sequential headwind that was to margins. Nick, the number of dedicated truck sales remains extremely strong despite what's going on with spot rates right now. As you reflect on the last couple of years and the strength that we've seen in dedicated sales, how much of that strength would you say is cyclical versus secular coming from private fleets that are outsourcing? I'll jump in on the dedicated side first. Thinking about that, I would just say that when I look back through our pipeline, it is still at an elevated level, a touch higher than it was this time last year. I think our demand is there. When I look through the detail, and we reviewed it the other day, it's a lot of private fleet conversions. I think it's just a long term. We got a lot of density going on right now, and a lot of density kinda helps us, give good solutions to customers. With intermodal growing, we have a lot of synergies there. I think it's just a good momentum. I don't think it's cyclical. We try to say that we're different than the normal over-the-road rates, one-way rates, and I think this has proven it out. That demand is very strong. Fuel impact. Hey Justin this is Brad, and I'll kind of add a little bit to the fuel question, expecting that, and I did some work on there. We talked about it in DCS, and it was at least 100 basis points headwind to margin percent on a year-over-year basis. We also looked at it on a sequential basis, and you would have seen a decent amount of margin improvement sequentially if you excluded the impact of fuel. As you're aware, we don't report OR or margin net of fuel surcharge like some others in the industry, but it was a headwind to margin. As a general statement, I did want to say, I mean fuel is a pass-through for us, and it really shouldn't impact our EBIT dollars. I just want to be consistent with how we've talked about it in the past and how we're talking about it here. Albeit we did provide a little bit more color on DCS recently, and I thought I'd just reiterate that. That's helpful. Thanks. Thank you. Our next question comes from Jordan Alliger with Goldman Sachs. Jordan, your line is now open. Hi. Curious on the final mile business, sort of ex the revenue quality initiatives that you guys have been working on. Can you maybe talk to what demand or volume sort of look like in that business? Obviously it's working a bit because the profits sort of bumped up from the first quarter. Maybe help think through the profitability in that segment looking ahead. Thanks. Yeah. The demand is still strong. It's spotty in some, as we said in our press release, in the value furniture side of things. The demand is there. One of the Chief Executive Officer of one of those companies told me that a year ago, fish were jumping in, customers were jumping into his boat. Six months ago, he had to fish with a hook with no bait on it, and now he's having to work it really hard to get sales. That was the analogy there. That's for the lower-end furniture value side. The other side is really still busy. Inventories are getting corrected, so we're seeing a lot of demand. We picked up some new business there, and our service is really what's separating us, and our background checks. That seems to be playing well. You're seeing this quarter we put a lot of pressure on rate at existing business, and we were successful in that. We lost some, but we feel good about the locations we lost. It's setting up good, and we got some more room to go. The profit thoughts though, given the $13 million I think you did in the second quarter. Yeah. I think we're gonna see. We're not going to give guidance, but we're happy with where we're at right now. Thank you. Thank you. Our next question comes from Jason Seidl with TD Cowen. Jason, your line is now open. Thank you operator, Afternoon all. Want to focus a little bit on ICS. I think you mentioned you made some tweaks inter-quarter, and then you gave sort of a number, I think, down 3% for volume growth on the truckload side. Could you give us maybe an idea of just the volume improved any after you made those tweaks in the quarter? Yeah Jason. You know, I think what I wanted to help understand is that we saw a really sharp decline in spot activity throughout the month of April. You know, finishing up March, as we talked about, our volumes were pretty positive in Q1, but really kind of hit a wall those first 15-18 days of April. That's when we were able to change some of our parameters of the algorithm that we use and some of our artificial intelligence around price points and win rates. So we did see it improve from that April timeframe. Historically, we've not provided that for this business segment, so I'm not going to share that today. Know that April was where the majority of the decline occurred, and we were able to step up from that position, the balance of the quarter. Okay. That's very helpful. Also, when you look at your carrier base, you know, have you seen any movement in terms of the smaller or micro-sized carriers, given the drop-off in spot and the rise in fuel? Have you seen those people maybe hang up the keys? You know, I think that we are seeing a little bit of that. One of the areas that I think we've seen it more pronounced is the growth of our independent contractors in our JBT segment, which I do think is a relative element of people that were out operating on their own that are looking to attach into a larger system that has better freight consistency for their benefit. I think that that's certainly an element that we paid close attention to. In terms of the volume of people that are just purely hanging it up, obviously every day in the news, there's some carriers that we're seeing, and we would probably anticipate, given the rate levels in the spot environment, that there is likelihood of more of that in the balance of the year, but not great data thus far. I do know that we highlighted in prior years, in 2021 in particular, just how many people sought their operating authority. Those numbers are certainly well down from those historical highs that we saw last year. Certainly less people are going that way. I do feel like we've seen elements, and Nick, maybe even relative to some of our driver hiring, improvement that we've experienced that could be representative of people looking for a safer place. Hey Jason, I might add to that. Jason, this is Shelley. I might add to that just overall in the platform. We do see trends inside the platform. For us, because the market is so large, you know, we are hitting new records inside Carrier 360. That would not be unusual. In this environment, you know, it does allow us to move more quickly. Some of what Brad just talked about came out of the platform, allowing us to make those tweaks readily. Sometimes when the flip happens suddenly, it's difficult for our platform to recognize the sudden shift or movement on price and what price it will take to do that, so we have to do some manual intervention there. We have seen faster platform activity. We do have a high retention rate as to how many carriers that are signed up. We have more carriers signed up, higher retention rates, more logged in. There are several records that happened in the second quarter. I think from that perspective, we've seen it. From carriers just going out of business, I think that'd be difficult for us to see. Thanks for the extra color, Shelley. Thank you. Our next question comes from Tom Wadewitz with UBS. Tom, your line is now open. Yeah Great, thank you. Wanted to see if you could offer a quick thought on how we should think about sequential intermodal margin, whether it might be kind of improving in 3Q versus 2Q, or similar. Shelley, you added some comments at the beginning of the call or provided some commentary on freight. I'm just wondering, it seems like there's been a lot of concern about freight really falling off, a lot of concern about the consumer, but it doesn't really seem like freight got that much weaker in second quarter. Do you think that it's likely that we see a significant fall off in freight looking forward, you know, given the pressure on the consumer? You think maybe it's just that the concerns about a fall off in freight activity have been overdone a bit and maybe the consumer hangs in better than you know people are expecting? Real quick, I'll just say long-term margin target in intermodal is 10%-12%. I'm sorry, Tom that's all you get. Tom Wadewitz, I would say. Go ahead. A lot of what we've spent the last hour talking about is the different signals we're seeing in different parts of the market. I think part of what you've heard from Brad and Highway Services is a result of a successful bid season happening and less dislocation from our shippers from their routing guide perspective. I think you're starting to see stabilization there. I will say, I think we are well-positioned in any environment, whether the market turns south or stays as is. We think that we're going to have a successful and good second half of the year. Certainly way too early for us to talk about anything beyond that, but we haven't had any customers specifically tell us that we should be concerned about volume. Certainly, we are all listening and reading the news as to what's happening out there. If the self-fulfilling prophecy does happen, then we'll adjust and make movement according to that. What's really great, and I said this in our opening comments, the supply chain is inefficient. Our customers are paying too much money because goods aren't moving the way they should move. We have a great opportunity to cube more for our customers, filling up trailers and containers. We also have a great opportunity to do mode conversion, getting it in a more efficient way to move goods. If 2023 sets up to be a softer freight environment, we're going to be in a perfect position because we will have added 1,000 more containers, thousands of more containers that will be onboarded and ready to start moving in January, along with the platform with Brad and our dedicated fleets. I think we're well-positioned to have a great 2023 in any environment. Okay. You haven't seen signs of a sharp fall off yet right? It's amusing but you just haven't seen customer input pointing to a sharp fall off at this point. Is that fair? We have seen a more seasonal July. The last two years have been difficult to predict what would happen in the supply chain. I would say July is typical and normal. You heard Nick earlier say that we are seeing good demand happen in the dedicated side, which would be going to the store. We have had concern from customers on inventory, having the wrong inventory and where it is located, but I've not heard any customers tell us that there's a downturn coming or anything to plan from a large percentage. Great. Thank you. Thank you. That concludes today's Q&A session. I will now pass the conference back over to John Roberts, Chief Executive Officer, for any additional or closing remarks. Okay thank you. We appreciate the time you've spent with us here today. I hope we've been able to give you some color on a quarter we're proud of. I think, importantly, maybe even more importantly, is the looking towards the second half and into next year. The first thing I want to remind everybody on this call of is that this table has a lot of experience, and we're all data-driven managers. We pay a lot of attention to what's going on around us. All the things we've talked about here today, from bids to used truck values, you know any element that would inform us is being taken into consideration. We talk very regularly about what does that change in direction in whatever element we're focused on mean to our business. That experience that we have helps us remember what we thought the last time we might have seen something like that. I really feel like it's important that we remember. We are 25- and 30-year senior members here. We've been through a number of these economic, whatever we're looking at here, changes. We hear really clearly from our customers. They talk to us very candidly. We talk very candidly with our rail providers. I know there's a good amount of appropriately placed concern on rail service, but I am confident as we all are, that this will resolve itself. I'm seeing evidence of that. We're in good conversation. I think that the overwhelming reason is that you know better service on the rail is a better answer for everybody involved. There's not anything really in our way there. I think the comprehensive nature of our businesses as described here today is a great balance. We give our customers just about everything they need, and they sort of balance each other. When one is moving one direction, another one might be assisting or helping or leading, too. I think that's been covered. You know, with DCS not being a trucking company, as Nick just said, you know, it doesn't necessarily follow the same patterns, but I fear that can still be misunderstood even today, that that business is viewed as some kind of a trucking company. We just really need to keep working on getting through that. Final mile showing us some recovery. I think the blend that's happening in highway is really productive. Really puts us in a great place with our customers, as Shelley pointed out, to be mode agnostic or indifferent. We blended assets into position where we can say yes to a lot of questions. I think that in total, you know, these businesses are healthy. They are well-placed. They're industry-leading, run by very, very capable managers, not just at this table, but throughout our whole system. A lot of experience involved there. You know, it's about execution the rest of this year. As someone said, we know a lot about what we need to know about. We pay attention to our data, and I think that, we're looking forward to the second half. We'll look forward to seeing you all again, on our next call. Thanks for being here. That concludes today's J.B. Hunt's Second Quarter 2022 Earnings Call. Thank you for your participation. You may now disconnect your line.