Good afternoon and welcome to Landstar System, Incorporated's third quarter earnings release conference call. All lines will be in listen only mode until a formal question and answer session. Today's call is being recorded. If you have any objections, you may disconnect at this time. Joining us from Landstar are Frank Lonegro, President and CEO, Jim Applegate, Vice President, Chief Corporate Sales Strategy and Specialized Flight Officer, Jim Todd, Vice President and CFO, Matt Dannegger, Vice President, Chief Field Sales Officer, and Matt Miller, Vice President, Chief Safety and Operations Officer. Now, I'd like to turn the call over to Mr. Jim Todd. You may begin. Thank you. Thank you, Elmer. Good afternoon and welcome to Landstar System third quarter earnings conference call. Before we begin, let me read the following statement. The following is a safe harbor statement on the Private Securities Litigation Reform Act of 1995. Statements made during this conference call that are not based on historical facts are forward-looking statements. During this conference call, we may make statements that contain forward-looking information that relate to Landstar business objectives, plans, strategies, and expectations. Such information is by nature subject to uncertainties and risks, including but not limited to the operational, financial, and legal risks detailed in Landstar 's Form 10-K for the 2024 fiscal year, described in the section Risk Factors, Landstar' s Form 10-Q for the 2025 first quarter, and our other SEC filings from time to time. These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated. Investors should not place undue reliance on such forward-looking information, and Landstar undertakes no obligation to publicly update or revise any forward-looking information. I'll now pass it to Landstar 's CEO, Frank Lonegro, for his opening remarks. Thanks, JT, and good afternoon, everyone. I'd like to thank our BCOs and agents and all of the Landstar employees who support them every day. It was great to spend time with our BCO independent contractors at our annual appreciation days in Bossier City, Louisiana, recently, and to celebrate their incredible achievements. We were extremely pleased with the turnout, and it was my honor to preside over Landstar's 52nd truck giveaway, awarding Christian Sanchez Cantu from Laredo, Texas, with a new 2026 Freightliner Cascadia. The capability, resiliency, and level of commitment exhibited day in and day out by our network of independent business owners is unique in the freight transportation industry. Their adaptability and dedication to safety, security, and service for our customers is truly impressive. They are exceptional business leaders and key to driving the continued success of Landstar's business model. The challenging conditions experienced in the truckload freight environment over the past 10 quarters continued during the 2025 third quarter. Volatile federal trade policy and lingering inflation concerns continue to generate supply chain uncertainty. However, even as overall company revenue decreased approximately 1% year over year, the 2025 third quarter included important positive signs for Landstar, which I'll cover shortly. As JT and I will discuss in greater depth later in our prepared remarks, and as disclosed in our earnings release, the 2025 third quarter financial results were impacted by three discrete, non-cash, non-recurring items. As we disclosed via the 8-K we filed with the SEC on August 15th, the largest of these items related to the decision to actively market for sale to Landstar Metro, our wholly owned Mexican logistics subsidiary that is principally engaged in the intra-Mexico truck transportation services. We are working towards a late 2025 or early 2026 sale of Landstar Metro and have thus far experienced a good deal of interest in that company, excluding the revenue contribution from Landstar Metro from both the 2025 and 2024 third quarters, as well as approximately $15 million in reported revenue during the 2024 third quarter that was associated with the previously disclosed agent fraud matter. The total revenue increased approximately 1% year over year in the 2025 third quarter. This is a positive marker for our business. Encouraging signs in our overall performance were highlighted by strength in the unsighted platform equipment business. This service type posted another strong quarter with a 4% year-over-year revenue increase driven by the performance of Landstar's heavy haul service offering. We generated approximately $147 million of heavy haul revenue during the 2025 third quarter, or a 17% increase over the 2024 third quarter. This achievement reflected a 9% increase in heavy haul revenue per load and an 8% increase in heavy haul volume. As noted in our earnings release and representing the collective efforts of many people at Landstar, Matt Miller and I are very pleased to report that the number of trucks provided by BCO independent contractors increased during the 2025 third quarter, representing the first sequential growth quarter since the 2022 first quarter. Our focus continues to be on accelerating our business model and executing on our strategic growth initiatives. We are continuing to invest in the foundational work that will put Landstar in a great position to leverage the freight environment when it eventually turns our way. We are also focused on our commitment to continuous improvement in the level of service and support we provide to our customers, agents, BCOs, and carriers each and every day. As I previously noted, in addition to the decision to sell Landstar Metro, our third quarter financial results reflected two other non-cash, non-recurring charges disclosed in our recent 8-K. These three discrete items in the aggregate resulted in impairment charges in the quarter of approximately $30.1 million or $0.66 per share. As a result, GAAP EPS were $0.56. Excluding the impact of these three items, adjusted EPS was $1.22. JT will cover these three impairment charges in greater detail during his prepared remarks. Turning to slide five, the freight environment in the 2025 third quarter was characterized by relatively soft demand from a seasonal perspective. The impact of accumulated inflation remains a drag on the amount of truckload freight generated in relation to consumer spending. Truck capacity continued to be readily available, with small pockets of supply-demand equilibrium, and market conditions continued to favor the shipper amidst choppy conditions in the industrial economy, as evidenced by an ISM index below 50 for the entire 2025 third quarter. Considering that backdrop, Landstar's revenue performance was admirable in the 2025 third quarter, with both truck revenue per load and the number of loads hauled via truck essentially equal to the 2024 third quarter. Our balance sheet continues to be very strong, and our capital allocation priorities are unchanged. We will continue to patiently and opportunistically execute on our existing buyback authority to benefit our long-term stockholders. As noted in the slide deck, during the first nine months of 2025, we deployed approximately $143 million of capital toward buybacks and repurchased approximately 995,000 shares of common stock. Yesterday afternoon, our board declared a $0.40 dividend payable on December 9 to shareholders of record as of the close of business on November 18. We continue to invest through the cycle in leading technology solutions for the benefit of our network of independent business owners and have allocated a significant amount of capital this year toward refreshing our fleet of trailing equipment, with a particular focus on investment in unsighted platform equipment. Turning to slide six and looking at our network, the scale, systems, and support inherent in the Landstar model help to drive the operating results generated during the 2025 third quarter. JT will get into the details on revenue, loadings, and rate per load in a few moments. As noted during previous earnings calls, Landstar's safety-first culture is a crucial component of our continued success. Our safety performance is a direct result of the professionalism of the thousands of Landstar BCOs operating safely every day and the agents and employees who work to reinforce the critical importance of safety at Landstar. I'm proud to report an accident frequency rate of 0.60 DOT reportable accidents per million miles during the first nine months of 2025, well below the last available national average DOT reportable frequency released from the FMCSA for 2021 and slightly better than the company's trailing five-year average of 0.61. This long-run average is an impressive operating metric that speaks to the strength, skill, talent, and dedication of our BCOs and provides a point of differentiation our agents are able to highlight in discussions with our freight customers. I'd also like to take a moment to recognize Landstar's nearly $500 million agents based on our 2024 fiscal year results. Importantly, retention within the million-dollar agent network continues to be extremely high. Turning to slide seven on the capacity side, on a year-over-year basis, BCO truck count decreased approximately 5% compared to the end of the 2024 third quarter. Importantly, as noted earlier in my remarks, BCO count increased by seven trucks on a sequential basis, representing the first increase in sequential quarterly truck count since the 2022 first quarter. BCO turnover continues to be influenced by a persistent, relatively low rate per load environment, combined with the significant increase in the cost to maintain and operate a truck today compared to before the pandemic. Directionally, we are pleased to see our trailing 12-month truck turnover rate drop from 34.5% as of the fiscal year end 2024 to 31.5% at the end of the 2025 third quarter. Through the first four weeks of the 2025 fourth fiscal quarter, the number of trucks provided by BCO independent contractors is down fractionally versus the ending truck count of Q3. We were encouraged, however, by a recent visit we had with U.S. Secretary of Transportation Sean Duffy. During our meeting, Matt Miller and I discussed several federal regulatory initiatives and administration priorities with the Secretary, with a real focus on issues facing truck drivers and the truck capacity marketplace. We were proud to confirm to Secretary Duffy that Landstar BCOs have had zero violations of the English Language Proficiency regulations and no reported issues with non-domiciled CDL regulations. We do not believe we have thus far experienced significant impact to our business from the federal regulatory agenda, but believe there is a potential longer-term positive impact for our BCO business in particular. I will now pass the call back to JT to walk you through the 2025 third quarter financials in more detail. Thanks, Frank. Turn to slide nine. As Frank mentioned earlier, overall truck revenue per load was essentially flat in the 2025 third quarter compared to the 2024 third quarter, primarily attributable to a 0.1% increase in revenue per load on both loads hauled by van equipment and unsighted platform equipment, offset by a 5% decrease in LTL revenue per load and a 2.2% decrease in revenue per load on other truck transportation loadings. On a sequential basis, truck revenue per load increased 0.5% in the 2025 third quarter versus the 2025 second quarter, slightly softer than the typical pre-pandemic normal seasonality increase of approximately 1.5%. In comparison to overall truck revenue per load, we consider revenue per mile on loads hauled by BCO trucks a pure reflection of market pricing as it excludes fuel surcharges billed to customers that are paid 100% to the BCO. In the 2025 third quarter, revenue per mile on unsighted platform equipment hauled by BCOs was 6% above the 2024 third quarter, and revenue per mile on van equipment hauled by BCOs was 2% above the 2024 third quarter. Delving deeper into seasonal trends, revenue per mile on loads hauled by BCOs on unsighted platform equipment declined 3% from June to July, declined 2% from July to August, and increased 3% from August to September. The June to July decline and the July to August decline both underperform pre-pandemic seasonal trends, while the August to September increase outperformed pre-pandemic historical trends. With respect to loads hauled by BCOs on van equipment, revenue per mile was more stable. Revenue per mile on van equipment hauled by BCOs increased 1% from June to July, underperforming these trends, decreased 1% from July to August, outperforming these trends, and was flat from August to September, underperforming pre-pandemic August to September historical trends. It should be noted that month-to-month seasonal trends on unsighted platform equipment are generally more volatile compared to that of van equipment. This relative volatility is often due to the mix between heavy specialized loads and standard flatbed volume. As Frank alluded to, we've been pleased with the recent performance in our heavy haul service offering. Heavy haul revenue was up an impressive 17% year over year in the third quarter, significantly outperforming core truckload revenue. Heavy haul loadings were up approximately 8% year over year, and revenue per heavy haul load increased 9% year over year. This represented a mixed tailwind to our unsighted platform revenue per load, as heavy haul revenue as a percentage of the category increased from approximately 34% during the 2024 third quarter to approximately 38% in the 2025 third quarter. Non-truck transportation service revenue in the 2025 third quarter was 1% or $1 million below the 2024 third quarter, excluding approximately $15 million in revenue reported during the 2024 third quarter that was associated with the previously disclosed agent fraud matter. Non-truck transportation service revenue in the 2025 third quarter increased by approximately $13 million or 16% compared to the 2024 third quarter. Turning to slide 10, we've provided revenue share by commodity and year-over-year change in revenue by commodity. Transportation logistics segment revenue was down 0.6% year over year on a slight decrease in both loadings and revenue per load compared to the 2024 third quarter. Within our largest commodity category, consumer durables revenue decreased approximately 4% year over year on a 3% decrease in volume and a 1% decrease in revenue per load. Aggregate revenue across our top five commodity categories, which collectively make up about 69% of our transportation revenue, increased approximately 1% compared to the 2024 third quarter. While slide 10 displays revenue share by commodity, we thought it would also be helpful to include some color on volume performance within our top five commodity categories. From the 2024 third quarter to the 2025 third quarter, total loadings of machinery increased 4%. Automotive equipment and parts decreased 4%. Building products decreased 10%. Electrical increased 23%. Additionally, substitute line haul loadings, one of the strongest performers for us during the pandemic and one which varies significantly based on consumer demand, increased 12% from the 2024 third quarter. We experienced strong demand related to AI infrastructure projects, which is reflected in part in both our electrical and machinery commodity categories, while strong demand for our services in support of wind energy projects drove the strength in our energy commodity grouping. As we've mentioned many times before, Landstar is a truck capacity provider to other trucking companies, 3PLs, and truck brokers. During periods of tight truck capacity, those other freight transportation providers reach out to Landstar to provide truck capacity more often than during times of more readily available truck capacity. The amount of freight hauled by Landstar on behalf of other truck transportation companies is reflected in almost all of our commodity groupings, including our substitute line haul service offering. Overall, revenue hauled on behalf of other truck transportation companies in the 2025 third quarter was 17% below the 2024 third quarter, a clear indicator that capacity is readily accessible in the marketplace. Revenue hauled on behalf of other truck transportation companies was 10% and 12% of transportation revenue in the 2025 and 2024 third quarters, respectively. Even with the ups and downs in various customer categories, our business remains highly diversified with over 23,000 customers, none of which contributed over 8% of our revenue in the first nine months of 2025. Turn to slide 11. In the 2025 third quarter, gross profit was $111.1 million compared to gross profit of $112.7 million in the 2024 third quarter. Gross profit margin was 9.2% of revenue in the 2025 third quarter as compared to gross profit margin of 9.3% in the corresponding period of 2024. In the 2025 third quarter, variable contribution was $170.2 million compared to $171.4 million in the 2024 third quarter. Variable contribution margin was 14.1% of revenue in both the 2025 and 2024 third quarters. Turn to slide 12. Operating income declined as a percentage of both gross profit and variable contribution, primarily due to the impact of the non-cash, non-recurring impairment charges included in the 2025 third quarter and the impact of the company's fixed cost infrastructure, principally certain components of selling general administrative costs, in comparison to slightly smaller gross profit and variable contribution bases. The decline in adjusted operating income as a percentage of both gross profit and variable contribution was significantly less pronounced given the size of the non-cash impairment charges and was attributable to the impact of increased costs negatively impacting operating income, while both gross profit and variable contribution were approximately 1% below the 2024 period. Other operating costs were $15.6 million in the 2025 third quarter compared to $15.1 million in 2024. This increase was primarily due to increased trailing equipment maintenance costs, partially offset by the favorable resolution of a value-added sales tax matter and a decreased provision for contractor bad debt. Insurance and claims costs were $33 million in the 2025 third quarter compared to $30.4 million in 2024. Total insurance and claims costs were 7.2% of BCO revenue in the 2025 third quarter as compared to 6.7% in the 2024 third quarter. The increase in insurance and claims costs as compared to 2024 was primarily attributable to net unfavorable development of prior year claim estimates and increased severity of both current period auto and cargo claims, partially offset by a decreased frequency of both auto and cargo claims during the 2025 period. During the 2025 and 2024 third quarters, insurance and claims costs included $9.2 million and $4.6 million of net unfavorable adjustment to prior year claim estimates, respectively. Selling, general and administrative costs were $57 million in the 2025 third quarter compared to $51.3 million in the 2024 third quarter. The increase in selling, general and administrative costs was primarily attributable to increased stock-based compensation expense, increased information technology costs, and increased employee benefit costs. Stock-based compensation expense was approximately $1.6 million during the 2025 third quarter as compared to a $43,000 reversal of previously recorded stock-based compensation costs during the 2024 third quarter. We continue to manage SG&A in part by closely managing headcount at Landstar. Our total number of employees based in the U.S. and Canada is down approximately 40 since the beginning of 2025 and down approximately 80 since peak headcount. We also continue to focus on driving efficiencies and productivity gains throughout our network. Landstar is actively engaged in rolling out an AI-enabled customer service solution throughout the corporate organization. We also continue to invest in and develop multiple in-flight AI-enabled products within our portfolio of digital tools in support of our network of agents, capacity providers, and employees. Depreciation and amortization was $11.5 million in the 2025 third quarter compared to $15.4 million in 2024. This decrease was primarily due to decreased depreciation on software applications. As Frank Lonegro referenced earlier during this call and as previously disclosed in a current report on Form 8-K filed with the U.S. Securities and Exchange Commission on August 13, 2025, the company conducted a strategic review of our operations during the 2025 third quarter focused on efforts to streamline our core operations and position the company for future growth. In connection with that strategic review, the company recorded non-cash, non-recurring charges in the aggregate for three discrete items of approximately $30.1 million or $0.66 per basic and diluted share. First, in connection with the decision to actively market Landstar Metro for sale, the company recorded non-cash impairment charges of approximately $16.1 million or $0.35 per basic and diluted share on the company's 2025 third quarter balance sheet based on the estimated fair value less cost to sell this business. The second charge noted in the earnings release related to the decision to select the Landstar TMS as the company's primary system for truckload brokerage services and, in conjunction with that decision, wind down the Blue TMS, an alternative transportation management system in use by one of the company's operating subsidiaries focused on the truckload brokerage contract services business. The resulting impairment charge representing the remaining net book value of the Blue TMS was $9 million or $0.20 per basic and diluted share. Third and finally, the company recorded a $5 million impairment charge relating to a non-controlling equity investment in a privately held technology startup company. This charge represented the total carrying value of this investment on the company's second quarter 2025 balance sheet date. The effective income tax rate was 25.8% in the 2025 third quarter compared to an effective income tax rate of 22.2% in the 2024 third quarter. The increase in the effective income tax rate was primarily due to, one, the favorable impact of certain federal tax credits during the 2024 period and, two, the deleveraging effect of lower pre-tax profits, mostly due to the just discussed three non-cash impairment items during the 2025 period, with a similar population of permanent items in both the 2025 and 2024 periods. Turn to slide 13 and looking at our balance sheet, we ended the quarter with cash and short-term investments of $434 million. Cash flow from operations for the first nine months of 2025 was $152 million and cash capital expenditures were $8 million. The company continues to return significant amounts of capital back to stockholders with $111 million of dividends paid and approximately $143 million of share repurchases during the first nine months of 2025. The strength of our balance sheet is a testament to the cash-generating capabilities of the Landstar model. Back to you, Frank. Thanks, JT. Given the highly fluid freight transportation backdrop and an uncertain political and macroeconomic environment, as well as challenging industry trends with respect to insurance and claims costs, the company will be providing fourth quarter revenue commentary rather than formal guidance. Turning to slide 15, the number of loads hauled via truck in October was approximately 3% below October 2024 on a dispatch basis, and revenue per load in October was approximately equal to 2024 on a process basis. As a result, we view October's truck volumes as modestly below normal seasonality, and truck revenue per load as lagging slightly behind normal seasonality. Looking at historical seasonality from Q3 to Q4, pre-pandemic patterns would normally yield both a 1% increase in the number of loads hauled via truck and truck revenue per load, yielding a slightly higher top line sequentially. As noted above, both fiscal October truck volumes and revenue per truck trended slightly below normal seasonality. With respect to variable contribution margin, the company typically experiences a 20 to 30 basis point compression in variable contribution margin from the third quarter to the fourth quarter, typically driven by a combination of decreased BCO utilization and compressing net revenue spreads on our truck brokerage business associated with peak season. As noted in our 10-Q, which we'll file a little later this afternoon, a BCO independent contractor with a subsidiary of the company was involved in a tragic vehicular accident earlier this month during the 2025 fourth quarter. Importantly, Landstar was not involved in the initial collision of this multi-stage incident. This incident is still in the process of being investigated but could have a material adverse impact on insurance and claims costs in the 2025 fourth quarter. With that, operator, we'd like to open the line for questions. Thank you very much, sir. At this time, we will begin the question and answer session. If you'd like to ask a question, please press star one on your touch-tone phone. Once again, that is star one to ask a question. To cancel your request, please press star two. Our first question is from Reed Seay from Stephens Incorporated. The line is open. You may begin. Hey guys, thanks for taking my question. I wanted to start off with what you're seeing in the broader truckload market. There's been a lot of noise on some of the temporary tightening we've seen and maybe some subsequent softening. Any commentary you have on the broader market would be greatly appreciated on the capacity exits in particular if you have any insights there. Yeah, I mean, I think we're pleased with what we're seeing on the BCO side. Again, given the first sequential increase in our BCO count since the beginning of 2022, that feels pretty good. We've been trending relatively flat there, pretty close to even keel, but actually seeing a positive sign there was really, really helpful for us. If for nothing else other than just morale, just getting seven additional trucks. I know Matt and his team are fighting every day to keep the folks that we have and to continue to look for ways to onboard high-quality drivers. I think there is a fair amount of conversation that's happening about the regulatory landscape, and obviously you're seeing headlines of upwards of 200,000 non-domiciled CDL holders out there. We're seeing English Language Proficiency getting enforced from time to time in various states. I would tell you that the impact on the capacity has got to be more than zero, but I also think it's going to come out over a little bit longer period of time than just a matter of weeks or months. Got it. Makes a lot of sense. Touching on kind of the BCO count decline slowing here in 3Q, it is encouraging to see kind of the truck count increase a little bit, but do you have any visibility to when you can return to BCO count growth here, maybe in the fourth quarter or in 2026? Yeah, so again, on the third quarter, relative to the end of the second quarter, we actually did increase the count ever so slightly at seven BCOs positive, so we were happy to see that. We're down just a little bit here in the October to date in the fourth quarter. I'll let Matt give you some commentary around what we normally experience this time of year, but what I can tell you is that the things that Matt and his team are working on are 100% geared toward making structural changes within what we're doing every day to both maintain the existing BCOs that we have and to onboard new folks. Matt? Oh, thanks, Frank, and thanks for the question. Given the rate backdrop, we're pleased with having the best gross truck adds quarter in eight quarters. During the third quarter, we saw gross truck adds up more than 15% compared to the third quarter of 2024. One of those things, we can't control rate, but the team's focused on what we can control, which is how we recruit, how we qualify, how we onboard, driving efficiencies, and improving that conversion rate of those expressing interest in coming on to Landstar. Likewise, there's two sides of the coin. On the retention side, we saw the seventh consecutive quarter of turnover improvement. High watermark was 41%. That was the fourth quarter of 2023. We just got down to 31.5% as of the end of the third quarter, really approaching our long-term average of 29%. All that being said, this really hinges on rate, right? If we saw an inflection in rate and rate ticking higher, I could see us finishing the fourth quarter higher than where we finished the third quarter, but that's going to be rate dependent. Got it. If I could squeeze in just a real quick one here, the approved and active carriers did decline from 2Q to 3Q. Could that impact your ability to more favorably buy freight just as you have a smaller pool to choose from? No, we don't really see that impacting our ability to source and satisfy demand. We're really being selective here, and we talked about that a little bit in the second quarter comments, but we're choosing to be a little bit more selective on who we choose to partner with. Pretty big backdrop as it relates to fraud out there in the space, and throughout the course of the year, those numbers have been coming down. If we're at all skeptical around the capacity provider or there's something in the background that we can't verify, we're erring on the side of caution given the fraud backdrop. Reed, I would just only add on to that, some of the pruning that took place in the third quarter around that carrier base, during the third quarter, we saw our net revenue margin on brokerage business actually widen out 78 basis points. Nothing from a capacity procurement side gives us any concern where we sit today. Perfect. Thanks for the color, guys. Thank you. Next one is from Jonathan Chappell from Evercore ISI Institutional Equities. Your line is open. You may begin. Thank you. Good afternoon, everyone. Jim or Frank, you guys can handle this. I want to go back to the first question. Jim said in his prepared remarks, revenue hauled for other transportation companies down 17%, a clear indicator of spare capacity. Your revenue per load, October flat, year over year, slightly below typical seasonal trends. Can you help us align both of those comments with some of the sources out there that have been talking about truckload spot rates spiking, basically throughout the month of October? Are you just not seeing that in your particular routes, or is maybe that a narrative that's kind of more broadly off base? Hey, John. I'll tell you the observations in the third quarter, and all three kind of move the same way. We talked about how our revenue per load increased with 50 basis points and typically goes up 150 basis points. We saw subseasonal pricing. We saw our net revenue margin on brokerage business widen out sequentially, and we saw tender rejections actually drop down a little bit in the third quarter when we had, we saw an uptick 1Q to 2Q. As we sit here today, it's day two of October close. I anticipate our October pricing is going to be about flat to September. If you go back 15 years historically, we get about a 60 basis point uptick September to October. It's not that it's significantly lagging, but we are not seeing, you know, if you're seeing public board data flash that spot rates are ticking up in October, we are not seeing that in our data thus far. Perhaps a bit of a Landstar lag that, you know, we've talked about in the past with agent behavior, not wanting to be the first one into their customers with a rate increase, but nothing we see in the numbers so far. Okay. Thanks, Jim. Also, just anything you call out, I know you're not giving guidance, just anything for the fourth quarter that'd be important to note on the expense side and also how we think about the bridge to incentive comp in 2026 versus 2025. Yeah, John. On the expense side, insurance is always noisy and a difficult line to predict. In a 90-day period, you heard Frank's prepared remarks about an early accident in October. We just went through an actuary review on the third quarter balance sheet date and had to true up some prior year reserve estimates. That one's a little noisy. On the other operating cost line, we held a BCO appreciation event. It's a little over $1 million. That'll be a tailwind 3Q to 4Q. Finally, on the incentive comp and stock comp, we're accruing to about a $10 million charge full fiscal year 2025. If that kind of resets in a one-time number, John, in 2026, that'd be about an $11 million headwind. Great. Thanks so much, Jim. For sure. Thank you. Next one is from Scott Group with Wolfe Research. Your line is open. You may begin. Thanks. Afternoon. I want to understand maybe some of the October volume trends. Do you have any way of isolating sort of what, you know, how government-related volumes are doing? I guess what I'm trying to figure out is I think everyone's talking about sort of subseasonal volume in October. Is this a government shutdown phenomenon that you can see pronounced in this one part of your business, or is it broader? It's a little bit of both, Scott. I'll start and let Jim Applegate chime in. I mean, it's a combination of the government shutdown, which, as you know, we're a fairly significant hauler for various federal agencies. We're certain that there's some there. The automotive business continues to be in a tough spot. Interest rates aren't helping the housing business, either. You heard Matt Dannegger on the prior call talk about our peak expectations, and you can certainly chime in, as well. I think we're seeing what we have been seeing in the past couple of quarters. Perhaps, adding to that is the government shutdown. Yeah, and just around the government shutdown, we're not seeing it in our actual numbers yet just because billings are kind of catching up, but we are noticing it in the dispatch loads. We are down, you know, over 30% so far within October from a dispatch standpoint as it relates to government loads, and we expect that to continue to trend down. However, it's temporary. You know, you'll see it trend down. When the government does pop back up, you'll see a bump back up, and we'll gain a lot of that back. Actually, from a disruption standpoint, we probably stand long-term to make out a little bit better than some of the other traditional asset-based providers just based on the flexibility of our network. We're watching it closely. You know, we do see it as something that's going to be a temporary blip, but we do see opportunity on the back end to catch up. Matt, you want to comment at all on the peak season? Sure. Thanks, Frank. Yeah, JT talked a little bit ago about our substitute line haul numbers being down this quarter. When we talk at peak at Landstar, we're really talking about a handful of customers in that sub-line haul sector. Going back the last couple of years, we've just not seen that coming off of those post-pandemic highs. The last couple of years has been a little bit muted. A lot of the transition and people going back to the stores has made a change. Retailers and these e-commerce finding different ways to manage their transportation. You got the tariffs this year, which maybe there's a little pull forward there, maybe some disruption on the back end here. We're just not seeing the amount of volume that we saw from our traditional partners in the past just because they're not getting the same amount of volumes that they've had in the past. I expect a muted peak season this year, probably similar to what we saw last year and maybe even down a little bit from that. Yeah, Scott, you saw UPS's print, so that'll give you some indication of where they are on their peak business anyway to the quarter. I look at our numbers in October relative to the backdrop, and I'd say we perform pretty well in the grand scheme of things. Okay. On the driver's side with all these regulations, I get what you're saying. You don't have any BCO exposure here, but how about on the brokerage side of your business? Do you have a sense of what percentage of the broker carriers you're working with have exposure here? It's hard to get a precise type of exposure. I do know, and Matt can chime in here in a second, I do know that our vetting criteria are pretty significant. We also have agents that are always directly conversing with those carriers. They have to be able to do business with us. I'd say there's kind of a high probability that there's not going to be significant impact there. What's interesting is the BCO population should stay relatively stable and increase in that type of an environment and could actually see some improved utilization there as loads present themselves that maybe in the past were handled by third-party broker carriers who might get impacted by either ELP or non-domiciled CDL. Yep. Appreciate the question. The FMCSA on the non-domiciled, they're probably the best place to go for data at this point because it's so recent. That emergency action just happened in September. We're a little bit more than a month beyond. They put out 200,000 as the potential estimated number of those impacted on the non-domiciled. Since June 25, when English Language Proficiency enforcement started to ramp, it started slow. We've seen more states adopt, even two in the past two weeks have begun training law enforcement on it. So far since June, 5,900 unique out-of-service violations. A ramp is still taking place there, but I don't expect a pop. Yeah, Scott, I have not heard, and I think I would, I have not heard any agents say, "I had to either give a load back or I got a load that was stopped because I had a third-party broker carrier that was taken out of service." You know, it's an anecdotal sample size, but we haven't heard anything certainly around this table of that. I mean, ultimately, what I'm trying to get at is you guys tend to be pretty straight shooters and not overly promotional. Do you think this is a big deal or not? Is this going to be, is this the big sort of catalyst for the cycle we've been waiting for, or ultimately, do we just need demand and that's going to be the key? How are you thinking about, is this the catalyst to get us going? The point that I would make here is if, and I'll put a big if on it, if DOT is correct and we're talking about 194,000 owner-operators over the next year or two, that would be a pretty big deal relative to that population. I like to think that our BCO population is going to be stable and grow in the backdrop of a tighter, you know, supply-side environment there. I can certainly paint you a nice picture there, but a lot of that's just going to depend on the enforcement. The enforcement doesn't really happen at the federal level. It happens at the state level. You can see the politics abound there in some of the banter back and forth between, for example, DOT and the state of California. A lot of that's got to happen on the ground in the states. It's not federal law enforcement that's involved in it. It's all the states. All right. Thank you, guys. Appreciate the time. Thanks, Scott. Thank you. Next one is with Ravi Shankar from Morgan Stanley. Your line is open. You may begin. Hi guys, this is Madison on for Robbie. Thanks for taking the question. Just one quick one on the back of Scott's question. I know you mentioned some impact on the dispatch loads for the government shutdown. I was just wondering if you can talk a bit about how quickly that business can ramp back up once the government reopens, and if I know you talked about a catch-up coming there, if that comes probably within the fourth quarter or if it gets pushed out more into 2026. Yeah, no, I think it's a good question. Really, it's about timing and how long this goes on for, and it's just a matter of the government's getting the money to go ahead and ship. It's going to be very quickly after the government reopens where you see that pipeline open back up again as well. We're not looking at it as something that's kind of detrimental to what we're going to see from a volume standpoint. Long-term, we're seeing it as something that's just kind of a short-term blip that we're going to get through. I think there'll be some opportunity on the back end. Yeah, I think it's going to be measured in days and weeks, not months or quarters. Got it. Okay, that's helpful. A little bit more of a bigger picture one. I know there's been a lot of talk in the market about AI usage in brokerage. I was wondering if you guys can give a little bit of color about what Landstar is doing there and how you kind of think you differentiate versus peers. Yeah, so the model is obviously a differentiator in and of itself. We've got three different areas that we're focused on. We're focused on AI to assist our agents. In the agency office, suggested pricing would be an example of that. We're also working on BCO retention. How do we make sure that we know when a BCO might be sort of sending us the quiet signals that they're maybe not long for the company? It could be a reduced number of loads. It could be a change in the type of freight. It could be the agents that they're dealing with, etc. We're looking at things in that space. We're obviously looking at it inside the building. We are a service provider in many respects where our corporate support people are designed to serve the BCOs in the agent community. If they're able to do that more effectively and more efficiently in how they are able to acquire knowledge in a particular question set, we're working on a whole call center technology and suite of AI-enabled tools there that are going to help us be more efficient and effective when we deal with both BCOs and agents. Got it. Okay, thanks so much. Thank you. Next question is from Jizong Chan with Stifel. Your line is open. You may begin. Yeah, thanks, operator, and good afternoon, gents. Maybe just a follow-up question on the technology side. You mentioned synthesizing the TMS onto one platform. I'm wondering if there are any identifiable cost savings that come out of that project or program. Similarly, on the AI side, any margin impact that you expect or that you're targeting internally from the rollout of these tools? Yeah, I think on the first one, I'll let JT chime in on the exact, but obviously we're not going to have two TMSs that we're continuing to develop either under capital or operating expense. He can walk you through the depreciation impacts on that one. Really just getting onto one platform was the important thing there. It will also give our folks within, which is a very small area, but within our blue organization, the ability to be working off of the exact same TMS that our agents are working off of, which I think is going to be helpful on both sides of that equation. On AI, we have not discussed any or disclosed any specific targets, but the increase in service levels is going to be our first area of focus, and then we'll look for opportunities on the efficiency side. JT? Yeah, thanks, Frank. Bruce, on the blue TMS, it was about a $750,000 depreciation tailwind already captured in the third quarter. From 3Q to 4Q, I expect, you know, no impact. Okay, thank you. Next question is from Brandon Oglenski with Barclays. Your line is open. You may begin. Hey, good afternoon, everyone, and thanks for taking the question. I'll keep this a little bit longer term. I know you don't really want to provide guidance here, but net income margins here, sorry, net operating margins, pretty much near the low, and I think that's very understandable just given where the market is. How do you think about the ability to get back to maybe the pre-pandemic range where you were pretty consistently 40% to 50% on net operating margin? Yeah, Brandon, good to hear your voice. Haven't spoken to you in a while, but look, I think the combination of increased revenue, which allows us to spread our fixed costs, the more that we can get in rate, obviously that's going to be our friend on OM. We've certainly got to turn the corner on insurance and claims and things of that nature. We've got to get the efficiencies out of the technology. Whether those happen inside our building or they happen in the agency offices and therefore translate into higher sales productivity within the agent community, that's the right outcome. From a BCO perspective, the more loads that are hauled via BCOs is better from a VC perspective for us as well. We're looking forward to touching all of those things through the tools and the AI that we're putting out there. Yeah, no, thanks, Frank. Brandon, I would certainly piggyback to Frank's comment on insurance. I would point you in 2019, we had about 10,500 BCOs leased on with us, and we had an $80 million insurance line that fiscal year. You take a look at where we were the first nine months of 2025 and run rate it, and we've got about 8,600 BCOs in the fleet. We are safer today or as safe today as we were in 2019. It's this persistent claim cost inflation that's not only impacting Landstar, it's impacting all the truckers. I think you're starting to see some chunkier exits in the trucking space, and eventually, folks are going to have to recapture that in the top line in the form of higher rates. We are clearly doing what we can, as I referenced in the prepared remarks around our headcount down 80 from the peak. It's down 40 since the beginning of the year. We are talking about a company that's got less than 1,300 heads supporting 8,600 owner-operators and 1,000 agents and taking care of 23,000-plus customers. We'll continue to work on the controllables. All right, thank you. Thank you. Next one is from Jason Seidl from TD Cowen. Your line is open. You may begin. Hey, thank you. This is Elliot Alper for Jason Seidl. How are you guys thinking about capacity planning over the next, call it, a year as these non-domiciled CDL regulations continue to roll off, or is it just too early to plan for? On the same note, are there conversations with your insurers or underwriting partners taking place on any changes to risk or risk premiums associated with any of these non-domiciled regulations? Yeah, good question. In terms of the non-domiciled, as I mentioned to you a moment ago, we don't have any. Our business model, where we are HAZMAT certified across our entire BCO fleet, your Jim Applegate talk about the government business that we have, there certainly are lots of gates or rigors that we put people through to make sure that we're able to support the customers that we have in the way that they need to be supported. Our insurers are going to ask us those questions as they should, and our answer is going to be we don't have any exposure there. In terms of capacity planning, our job is to qualify and onboard as many BCOs as possible and to try to retain all of the BCOs that are currently leased on to us. You're going to see us continue to focus really, really hard on growing the BCO fleet. In terms of capacity itself, we have a lot of different ways that we go about recruiting and retaining appropriate third-party capacity providers. Again, as I mentioned earlier, it's really important that they can support our customers with the appropriate level of safety, security, and service that our BCOs do. We're going to err on the side of caution when it comes to those three things. If we have any thought that they're not going to be able to converse in English or they're holding a non-domiciled CDL, then we're going to, honestly, we're going to vet those out. The quality is what we sell here. We don't transact in price. You can see that just based on our rate relative to where the DAT board rates are. We're at a different premium level, and we want to maintain that quality. Okay. Great. Thank you. Just following up, I understand October is trending below seasonality and a couple commentary around peak expectations. Can you discuss how the load and revenue per load comparisons stack up as we move through the quarter? I'm just trying to gauge if comps get tougher off October. Thank you. Yeah, from my recollection, I don't have the 4Qs last year. Bear with me one second. It looks like last year, fourth quarter volumes dropped off 190 basis points sequentially, and it looks like rate was up 100 basis points sequentially. Rate was basically right in line with normal seasonality. It looks like we're starting out of the gate here in October flattish, and October rates typically gap up about 60 basis points. I would tell you we're achieving that 100. We'll take a strong lift here in fiscal November and fiscal December. From an October standpoint, you heard Applegate talk about government and Frank talk about some of the parcel carriers and some of the automotive. We're running, I think, down 4.5% loads per workday in October, and we typically drop off about 2% loads per workday October versus September. We'll need a little catch-up baseball there as well. Appreciate it. Thank you. Thank you. Our last question is from Stephanie Moore from Jefferies. Your line is open. You may begin. Hi, good afternoon. Thank you. Maybe circling back to this part of Scott's question on the supply and demand environment, but focusing on the demand environment, it's been very weak for some time, and we can all look at the data, including PMIs and the likes. Overall, it's still a relatively healthy macro, depending on what you look at. What do you believe we need to see in terms of the demand environment ultimately improving? Are you hearing any early optimism about this in 2026? Also, is there anything you can call out from an end market exposure where you're seeing maybe some underlying strength or maybe weaknesses too? Thank you. Yeah. Hey, Stephanie. Let me try to take a stab at it. What would we need to see in order for the demand environment to improve? I think first and foremost, you'd need to have stable trade policy and have some of the, you know, the relations between U.S.-China, U.S.-Canada, U.S.-Mexico. The more normalization we can see there, I think the better for people deploying capital, which is ultimately what it comes down to. I also think the consumer, if they were to shift a little bit more back to goods rather than services, that would certainly be helpful. I think the big beautiful bill, and the unlocked potential there, which is certainly going to create the possibility of additional cash flow in companies. They're certainly going to have the capital to deploy. Again, I think you need normalization of trade relations to get to a better spot to allow people to do that. In terms of, you know, interest rates and Fed policy, we'll all be ears open tomorrow to see what the Fed's going to do and ultimately what's the impact on medium and longer-term rates because that would help out on the automotive side and on the housing side. In terms of bright spots, we clearly have seen a significant uptick in our unsighted business and in their heavy haul business. Continuing to see that play out over time would certainly be helpful from a Landstar perspective. The AI data center, you know, eight commercial AC associated with that, the PowerGen, like all of the things that are in that AI ecosystem, we have seen the benefit of. I think we've seen a little bit of an uptick in the quarter relative to prior quarters in the U.S.-Mexico cross-border business, which has been down for us for several quarters, and we're actually seeing it improve. That feels pretty good. I can paint you a good picture for next year, but we just haven't seen it. Right now, it's on paper. I haven't been able to see anything that would tell you that those are actually what's going to transpire when we flip the calendar to January 1. Great. Thanks, everybody. Thank you. At this time, I show no further questions. I'd like to turn the call back over to you, sir, for closing remarks. Thank you much, John. In closing, while the freight environment remains challenging, we believe we have seen some positive signals. We were encouraged by the modest sequential pricing improvement we experienced during the third quarter, and with a choppy industrial economic backdrop, we were extremely pleased with the 17% year-over-year revenue increase in our heavy haul service offering. We also believe the potential impact of various federal regulatory developments could provide some positive lifts for our BCO business in particular. Regardless of the economic environment, the resiliency of the Landstar variable cost business model continues to generate significant free cash flow. Landstar has always been a cyclical growth company, and we are well positioned to navigate the coming months as we continue to look forward to higher highs when the freight market turns our way. Thank you for joining us this afternoon. We look forward to speaking with you again on our 2025 fourth quarter earnings conference call in late January. Thank you. Thank you for joining the conference call today. Have a good evening. Please disconnect your lines at this time. Thank you very much.