Thank you for standing by, and welcome to the Schneider Third Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. Thank you. I'd now like to turn the call over to Steve Bindas, Director of Investor Relations. You may begin. Thank you, Operator, and good morning, everyone. Joining me on the call today are Mark Rourke, President and Chief Executive Officer, Darrell Campbell, Executive Vice President and Chief Financial Officer, and Jim Filter, Executive Vice President and Group President of Transportation and Logistics. Earlier today, the company issued an earnings press release. This release and an investor presentation are available on the Investor Relations section of our website at schneider.com. Our call will include remarks about future expectations, forecasts, plans, and prospects for Schneider. These constitute forward-looking statements for the purposes of the safe harbor provisions under applicable federal securities laws. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from current expectations. The company urges investors to review the risks and uncertainties discussed in our SEC filings, including, but not limited to, our most recent annual report on Form 10-K and those risks identified in today's earnings release. All forward-looking statements are made as of the date of this call, and Schneider disclaims any duty to update such statements except as required by law. In addition, pursuant to Regulation G, a reconciliation of any non-GAAP financial measures referenced during today's call can be found in our earnings release and investor presentation, which includes reconciliations to the most directly comparable GAAP measures. Now I'd like to turn the call over to our CEO, Mark Rourke. Thank you, Steve, and hello, everyone. Thank you for joining the call today. For our prepared remarks this morning, I'll be sharing my perspective on the overall freight market and discuss segment positioning and performance across our multimodal platform of truckload, intermodal, and logistics. Following that, Darrell will provide a financial overview of third-quarter results and share our full-year 2024 EPS and net capital expenditures guidance. Then we will be pleased to take your questions. Last quarter, we outlined a framework designed to drive ongoing structural improvements in our business, deliver increased enterprise value, and allow us to seize the opportunities ahead, enhancing financial returns as the freight market recovers. The framework includes focusing on the customer by delivering an effortless experience, managing the freight allocation process with purpose and discipline, optimizing our capital allocation across our strategic growth drivers, and managing costs across all expense categories. In the third quarter, the market continued its path toward recovery, with seasonality becoming more prevalent, but on trend, not yet proven. When we updated our expectations for the second half of 2024 on our last earnings call, we had experienced a solid quarter end in June from a traditional seasonality standpoint, and our visibility into July at that time suggested more of the same. However, the improved seasonality trends did not sustain mid-August through quarter end and were further impacted by the hurricanes and East Coast port strike in the short term. Let me highlight a few key areas that best illustrate the quarter's framing and the setup going into 2025 by segment, starting with truckload. The network truck business is by far the most challenged from a performance and return standpoint, as more than 100% of the earnings in the truckload segment are currently in the dedicated sector. We are seeing capacity steadily exiting the industry, as our channel checks into the truck lending community are indicating that defaults and repossessions are growing and, in some cases, rivaling the financial crisis levels from 2008 and 2009. Carriers are not being adequately compensated for the value provided and the cost to deliver. While we are prepared to pivot quickly, we are minimizing capital allocation to network. Despite the current freight environment, we are not waiting for market correction to improve results. In addition to our cost reduction and productivity actions, there are two other primary focus areas that will drive an improvement in truckload network results: rate restoration and growth of owner-operator capacity. The first action is rate restoration, where we remain disciplined. As of the end of September, we were 85% through our network contract renewals, with third-quarter renewal rate improvements in the mid-single-digit percentage range. As customers seek to prepare for a market correction and move to asset-based carriers, we anticipate growth opportunities, which in turn creates the ability to address the lowest-performing freight in our network. The second self-help opportunity for the truckload network is to grow our owner-operator fleet. While we have seen a number of owner-operators shrinking for Schneider and in the industry, we believe we have an opportunity to change that trajectory. We have recently launched Schneider's FreightPower for Owner Operators, an updated consumer-grade platform that now provides owner-operators visibility to more freight opportunities across the Schneider portfolio of services. FreightPower provides business owners increased choice and time-saving features while delivering a higher level of service to customers, especially in brokerage. Moving now to dedicated. Average truck count was down 66 sequentially, but we exited the quarter with tractor count 17 units higher, as startup and current account growth activity accelerated through the quarter. Overall, our account churn is down 50% from 2023 levels, and we expect this high-level retention to continue in 2025. Finally, two large greenfield startups originally slated for the back half of 2024 have been pushed into 2025 due to customer launch delays. While the exact startup timing for these awards is to be determined, our new business pipeline is strong with several meaningful opportunities in their latter stages. As of the end of September, dedicated represented 64% of our truckload fleet. We have strategically grown our dedicated fleet on average by 9% per year since our initial public offering through quality organic new business growth and acquisitions. Our dedicated offering serves a wide range of customer verticals and creates differentiated supply chain value. We are confident about the opportunities ahead. Moving to the intermodal segment, earnings improved sequentially and grew over 40% compared to last year, mostly through execution and structural internal cost improvement actions. All of our intermodal book has gone through the annual renewal process. Third-quarter win rates and incumbent lane retention outcomes improved from the second quarter renewal season as we maintain pricing discipline in a highly competitive environment, with another quarter of contractual pricing remaining flat. year-over-year, intermodal grew volume and maintained revenue per order. We experienced double-digit percentage order growth year-over-year in the West and Mexico. However, we experienced offsets in the East and a very competitive truckload and intermodal market. We remain disciplined in allocation events and use the opportunity to heal the network by improving network flows and balance. Our intermodal offering is differentiated by our asset model, which utilizes owned equipment and company dray drivers and our strong relationships with rail providers focused on mutual growth. As the truckload market rationalizes, we will leverage this differentiation. We are pleased with the STB approval of the connection between the CPKC and CSX, creating service between Mexico and Texas to and from the southeastern United States. We eagerly await the publication and initiation of this new corridor, which will further advance our intermodal offering. Transitioning to our logistics segment, we remain solidly profitable in the very competitive brokerage market by leveraging our differentiated FreightPower platform for shippers and carriers. We experienced minimal year-over-year volume shrink of just 1% while maintaining effective gross margin management as carrier costs increased through the quarter. In addition, shippers are increasingly favoring asset-based brokerage in this stage of the freight cycle. The brokers and spot markets move the fastest, and we are well-positioned to pivot across both our traditional live load, live unload brokerage business, as well as our highly adaptable and flexible power-only solution. I'll now turn it over to Darrell for his summary comments on the quarter and a look ahead before we get to your questions. Darrell? Thank you, Mark, and good morning, everyone. I'll review our enterprise and segment financial results for the third quarter, along with our year-to-date cash flow trends and capital allocation actions. Additionally, I'll provide insights on our updated full-year 2024 EPS and net CapEx guidance. Summaries of our financial results and guidance can be found on pages 21 to 26 of our investor presentation, available on our investor relations section of our website. As the industry navigates ongoing freight market conditions, I want to reiterate our objective of positioning the business for structural resiliency and being advantageous during the freight market correction. While we're actively addressing the short term, our focus remains on enhancing long-term value. Through all cycles, we remain disciplined on commercial actions, cost management, and resource optimization across our enterprise. We continue to implement margin and capital restorative actions, which are positively impacting every segment of our business and positioning our multimodal platform of services for resiliency, growth, and long-term value creation. In the third quarter, revenues excluding fuel surcharge were $1.2 billion, essentially flat year-over-year. Our third-quarter adjusted income from operations was $44 million compared to $48 million a year ago. Adjusted diluted earnings per share for the third quarter was $0.18 and $0.20 a year ago. Compared to the third quarter of last year, lower net gains on equipment sales and equity investments in aggregate represented a $0.04 headwind to earnings per share. Increased auto liability insurance costs year-over-year were also a $0.04 headwind. Despite our ongoing investments and favorable safety performance, we continue to operate in an environment of increased litigation, higher settlement costs, and rising insurance premiums. From a segment perspective, truckload revenues, excluding fuel surcharge, were $532 million in the third quarter, 1% below the same period a year ago. This decline was primarily due to lower network volumes, which were mostly offset by growth in our dedicated sector. truckload operating income was $24 million, down 3% year-over-year, impacted by the same factors that affected revenues, as well as increased insurance costs and lower year-over-year gains on equipment sales. Despite lower network volumes, truckload operating ratio was flat to the same period a year ago as our dedicated business continues to show resiliency. Intermodal revenues, excluding fuel surcharge, were $265 million in the third quarter, 1% higher than third quarter of 2023, primarily due to volume growth. Intermodal operating income was $16 million, a $5 million increase compared to the same period last year. Intermodal operating ratio improved 170 basis points year-over-year, benefiting from volume growth, internal cost actions, network optimization, and enhanced trade performance. The trade improvement was supported by an increase in the percentage of our freight moved with company assets and improvements in trades per day. Logistics revenue, excluding fuel surcharge, was $314 million in the third quarter, down 4% year-over-year, primarily due to lower revenue per order. Logistics operating income was $8 million compared to $9 million a year ago, reflecting lower volume and net revenue per order. Third quarter 2024 logistics operating ratio was essentially flat compared to the same period a year ago, showcasing our ability to operate profitably through all market cycles. Turning to capital allocation, net CapEx through September was $154 million below the prior year. This reduction is due to enhanced asset productivity and improved driver-to-tractor ratio, freight network optimization, and our ongoing capital allocation discipline. These actions have primarily driven a corresponding $154 million year-to-date improvement in our free cash flow compared to last year. Along with the strength of our balance sheets, this facilitates our continued ability to allocate those dollars to our strategic priorities, including organic and inorganic growth opportunities. As we execute actions to improve our free cash flow conversion, we remain prudent in positioning our assets for the future while managing our fleet age objectives. Our full-year 2024 updated net CapEx guidance is within our previously communicated range at approximately $330 million. During the quarter, we advanced our share repurchase program with approximately $4 million of opportunistic purchases. At the end of September, we had approximately $54 million remaining on our $150 million share repurchase authorization established in February last year. Through September, we also returned $50 million in dividends to our shareholders, which is 5% higher than the same period a year ago. Finally, our net debt leverage stood at 0.15 times at the end of the quarter. As Mark mentioned, after experiencing more typical seasonality in June and July, market conditions were below our expectations in August and September, primarily impacting our truckload network volumes. In addition, the previously mentioned delays in dedicated implementations will impact fourth-quarter results. While we continue to operate in uncertain environments and our expectations regarding the timing of a more sustained freight market improvement have shifted, we've seen signs of economic and freight market stabilization. During the fourth quarter, we expect year-over-year earnings improvements. Our guidance anticipates continued stabilization across most of our businesses, as well as improved seasonality, particularly within truckload network and logistics. Based on these factors, we've updated our full-year 2024 adjusted diluted earnings per share guidance to $0.66-$0.72, which assumes a full-year effective tax rate of 24%. With that, we'll open the call for your questions. Thank you. We will now begin the question-and-answer session. If you would like to ask a question, please press star one in your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. We ask that you please limit yourself to one question and one follow-up. Your first question comes from a line of Tom Wadewitz from UBS. Your line is open. Hey, this is Michael Triano. One for Tom. Great. I wanted to ask on the full-year guide. So it implies slight sequential improvement in earnings through Q3 to 4Q at the midpoint. Just walk us through your assumptions there based on what you're seeing in the market, your views on peak season, and if there were any pull-forward effects from the container imports off the West Coast that we should be keeping in mind? Sorry, I don't know if I caught the very first part of that question. Would you just mind repeating that? Yeah, just on the 4Q guide, just kind of the assumptions behind it based on what you're seeing in the market, views on peak season, and then if there were any pull-forward effects from container imports that we should be keeping in mind. Sure, sure. From a seasonality standpoint, we do expect improvement from the third quarter to the fourth quarter. We assess that through not only what we expect on typical seasonality for the holiday season, but some of the project work that we have secured, which is at an improved margin performance from an expectation. So while the solution is secured, obviously, demand will drive how much of that actually gets utilized. And so we feel that both in the retail and the e-commerce markets seem to be performing at expectation. And so that's how we see the third to fourth quarter improvement. Certainly, as we look back on the quarter, there has been some pull-forward. Every customer has a slightly different strategy to that, but there have been effects, certainly in the intermodal business on the West Coast. I saw some improved volumes in the third quarter, and we would attribute some of that certainly to some pull-forward activity. Okay, and then just to follow up on the 2Q to 3Q bridge and the trucking segment operating income, could you just walk us through the moving parts there that drove it down sequentially? There seemed to be some puts and takes there with the network fleet countdown, higher insurance expense offset by the rate increases that you're getting there on the network side. Yeah, I think that's a very good summary of the effects second to third quarter. As we kind of outlined in our prepared comments, we did not see the seasonality sustained the second half of August and through the month of September to the same degree that we experienced at the end of the second quarter of June period and what we experienced from a seasonality, which we were very encouraged by through the month of July, so some of that is moderating order tenders, and some of that is on the cost standpoint, as noted, with increased insurance costs. Sure. And yeah, this is Darrell. So if you think about truckload in terms of dedicated versus network, as Mark said, we saw some declines in volume sequentially in the network side of the business, but dedicated showed resiliency. So some of that resiliency, obviously, we're looking ahead when we're positioning our guidance for the fourth quarter. So it's kind of a tale of two portions of the segment. Intermodal also showed resiliency. We did see sequential improvement from the second going into the third, which also informed some of our guidance. Okay. Thank you. Your next question comes from a line of Ariel Rosa from Citigroup. Your line is open. Hi, yes. Good morning. Thanks for taking our questions. This is Ben Moore on for Ari. Can you hear me? Yes, absolutely. Okay, great. Yes, wanted to ask for both your dedicated and network segments, you've had two quarters now of sequential decline in truck count, but sequential growth in revenue per truck per week, and usually pricing lags volumes. But in this case, it looks like your pricing is leading volumes. Why do you think that is, and should we expect this trend over the next few quarters? Yeah, first, let's attack that from a dedicated standpoint. As we mentioned, on an average, on our external metrics, we were down, I believe, 66 units. We came out of the quarter slightly ahead as current account and startup activity accelerated through the quarter, so we actually finished up about 17 units, and as noted, we had a couple of fairly large greenfield opportunities in dedicated that we expected to start up in the second half of the year that the customer, through their product launch delays, has pushed into 2025. So there's some moving parts there, but we do have remained disciplined on our pricing and both on contract renewals. Obviously, in dedicated, you have some built-in modifiers as contracts renew, but in network, we've had our third consecutive quarter of improved pricing contract renewals, with the third quarter being our highest since, I believe, first quarter of 2022. So, at some point, and some customers, that's trading off for volume. Others are just upgrading the bottom of the portfolio. And that's really our focus on rate restoration, is to continue to lean into opportunities to improve our overall yields because we need to do that, particularly in the truckload network side. Great. Thanks so much for the insights there. Maybe as a follow-up, shifting to the cost side. And Darrell, you had touched on this in your prepared remarks. It looks like your operating supplies and insurance line items were kind of the big spots. They both stepped up to what looks like record levels versus historicals as a percentage of revenue, with operating supplies at 12.9% versus average 10.5% historically. And then for insurance, up to 2.8% versus an average of 2.1% historically. The latter, understandably, we've got higher premiums due to the growth in nuclear verdicts. But how should we think about these as a percentage of revenue in terms of a range going forward? Should we expect kind of roughly that elevated range for the next year or two on average? Yeah. So good questions. I guess if we start with insurance, I think you laid it out pretty well. From our perspective, the biggest impact that we can have on insurance costs is reducing exposures, right? So we've been focused on investments in our business and processes that have been driving down frequency of incidents over time, over the past several quarters. But as you recognize, we're in an environment where there's increased litigation, there's nuclear verdicts, increasing premiums, as you said. So we're seeing some of that come through, particularly in the third quarter. But not to lose sight of the fact that our frequency is coming down. As it relates to operating supplies, that's primarily a function of the denominator, right? So we would say that our revenues are not normalized. So we wouldn't use our revenue this quarter as a normal baseline. But we did see increases in that line item. That's where our gains on sale of equipment sit. So we've had lower year-over-year gains on equipment sales. And as we mentioned in the second quarter, our leasing business results, which were driving other down, the cost of goods sold associated with the leasing business is reflected in operating supplies. So just a continuation of the environment that we've seen as pressured owner-operators coming through in the results. I just want to maybe reinforce the safety and the insurance line. First, our number one job one is to reduce overall exposure and incidents. And as we look at the third quarter of this year, we actually had a 30% reduction in our DOT reportable accidents, which are ones that could have, based upon circumstance, the higher severity and cost. So job one is just lower the top of the funnel. We're doing a terrific job. And I'm really proud of our driver community, our operations, and safety teams who are really leaning in and improving our overall performance to include a 9% reduction year-over-year on anything related to injuries of our associate base. So again, as those trends continue, and that's a multi-quarter trend for us, it ultimately lowers the overall exposure and settlement and anything else that comes with this volatile area. Great, great. Really appreciate the time and insights. Thank you. Your next question comes from a line of Ravi Shanker from Morgan Stanley. Your line is open. Hey, great. Thanks. Good morning. This is Christine McGarvey on for Ravi. I want to circle back to the one-way operating seemingly at a loss. Seems like you guys are taking some actions to improve that, but just want to get your thoughts on what the path of profitability looks like, both in terms of magnitude and the slope of that. I imagine the cycle could be more or less helpful, but would just love to get your thoughts on how that can play out over the next couple of quarters. Great. Thank you, Kristine. Right. Maybe just frame this within our strategic objectives of what we are positioning the company, and certainly, we would expect our network business to be the most commoditized and the most volatile as you look at both sides of a market up or down, and so what we're trying to do is minimize the impact of that through growing our strategic growth drivers of dedicated, which we've made great progress on at 64% of our units. And we're continuing to look at both organic with a very strong pipeline and inorganic opportunities to continue that. In addition, as we leverage our differentiators in a recovering truckload market, also has great benefits to our intermodal business and bringing more variable capacity to play in our network business with solutions like power-only and putting more owner-operators at play into that segment. So that's our strategy to isolate and minimize the volatility effects of the network offering. In the short term, though, we need to get a compensable rate and continue to lean in and improve the book of business in the network. And we've made progress in the last three quarters doing that, and we would expect that we'll continue as we turn the page into 2025 on the rate restoration activities. We think we have the right amount of core company drivers around our core network, and then how do we augment that with some increased owner-operator performance there, particularly as you've seen, not only with us, but across the industry, have more shrinkage there, I think, almost at any time since the 2008 and 2009 financial crisis. We're doing that through some additional investments in technology with our owner-operator FreightPower application, which ultimately provides more access to freight and more visibility to freight across our portfolio of all the freight generation activities we have as an enterprise. It has both a top line, a cost, and a rate restoration activity to move us to a more sustainable position within the network. Great. That's really helpful. Maybe if I can ask one in a slightly different direction, but obviously, we've had some pull-forward related to some supply chain disruption this year. But as we look forward, is there any talk amongst your customer base about another potential pull-forward ahead of tariffs in light of the election results? And what do you think that might look like? Has enough capacity come out that that could be a more structural tightening event, or how are you thinking through some of those dynamics? Yeah. Thanks, Kristine. This is Jim. I would say at this point, we haven't had many discussions with our customers about an additional pull-forward relative to tariffs. Not that that won't happen, but that would happen at a little bit faster pace than what we would normally see, as currently our customers are really operating just on their normal replenishment cycle preparing for this holiday push. So it is something that still could be out there ahead of us. Great. Appreciate the time very much. Thank you. Your next question comes from a line of Christian Wetherbee from Wells Fargo. Your line is open. Hey, good morning, guys. It's Rob on for Chris. Taking a step back here, how should we be thinking about the opportunity for margin expansion next year? Obviously, it remains a very competitive environment. It sounds like you guys are getting some rate restoration within the network business. But just curious how you think about the puts and takes given cost inflation to improve margins looking out to next year. Yeah. We won't have a whole lot of guidance, obviously, at this juncture for 2025. But on trend, certainly, we continue to believe capacity is exiting the marketplace. It's been a slow grind to do. Mentioned in my opening comments, as you look at the lending community and the quality of where the loan portfolio is, it is in perhaps its toughest spot since the financial crisis, which means we're increasing, I think, out of levers, and they're out of levers to continue to allow that capacity to continue. So I think that's a key area to watch, which will help on the supply side of the equation. In our most recent customer discussions, I think we've walked away with the sentiment that they're looking towards a market recovery of some sort themselves. And I think that's why you're seeing some more favorability to asset-based carriers and certainly asset-based brokerage. I think that trend continues, and I think that builds, at least in our mind, as a positive contributor to a 2025 scenario. Your next question comes from a line of Daniel Imbro from Stephens. Your line is open. Hey, thanks, guys. This is Reed on for Daniel. Kind of to follow up on the other intermodal questions that we've had earlier, if you could provide some color on your expectations for intermodal pricing going forward, given we had some outperformance in the quarter, at least versus our expectations. Do you see this as sustainable in the fourth quarter? And are you expecting to be able to grow pricing in 2025? And kind of along the same lines, OR has been improving. Do you see that as continuing in the fourth quarter? And going forward, just any color there would be helpful. Sure, Reed. This is Jim. A little bit early for us to be giving guidance on 2025 pricing. I think what you're seeing right now is that we're remaining disciplined through this allocation season, the way that we're managing our network as well, that small amount of price improvement sequentially year-over-year, just as a result of that improvement, as well as a little bit of aid here from just improved network dynamics of where we're growing our business. Got it. Thank you. And just real quick on the CapEx guidance as well. You basically kept it flat with the report while there are some challenging dynamics in the backdrop. If you could just provide some color in your thoughts there. Yeah. So as a recap, in the second quarter, we had guided to $300 million-$350 million for the full year. We're coming in at $330 million, so square in the middle of what we had expected. There are a number of actions that we've taken, right? Our productivity has improved. We've tightened our truck-to-driver-to-tractor ratios, which obviously has an impact on what our CapEx spend has to be. We've maintained capital discipline in terms of allocating to the sectors that are demonstrating the most growth. So that's been a continuation of an exercise that's been going on for several quarters. So the guidance really confirms a lot of what we've been doing to this point. That's a net CapEx guidance, which also has the proceeds from disposal equipment, and that's moderated a bit. That still puts us right in the middle of the range as we look forward. We also believe we're in a position as we grow our business in both intermodal and across our power-only and network business, we can do so without reinvesting to nearly the same degree we have the last 24 months on trailers. We think we're in a position to have some incremental margin improvement as well as not having to invest capital to go after those improvements. We'll be more specific as we get into 2025, but that's an area that I think we can leverage to the benefit of our shareholders. Got it. Appreciate the color, guys. Your next question comes from a line of Ken Hoexter from Bank of America. Your line is open. Hey, great. Good morning. So Mark, you mentioned earlier that rates were the best level in a few years. I believe that you might have thrown there topping some contract levels, but yet market is still not investable. So I guess one is a little odd given there were 30,000 net orders placed last month. I'm still trying to wrap my head around why we keep getting those such high levels. But what does that tell us about the backdrop in an environment where you're getting spot to improve, yet you're still looking, and you and Darrell taking that fourth quarter down to basically flat, I guess, to $0.1622? How do you think about the environment given the spot rates are improving? Yeah. And I believe, Ken, that's mostly a network question. And a couple of things. We have taken actions to arrest some of the inflationary impacts, but we still, from a rate recovery standpoint, for complete margin recovery into the path that we think we need to be on to reinvest in the business, we still have work to do. And so certainly encouraged by the last three quarters of at least starting to turn that into the positive category and even more so here in the third quarter renewals from a lift standpoint. Again, that's in front of us, right? Third quarter renewals doesn't mean we've experienced that in the third quarter. It depends when the implementation of those awards are until you get a chance to yield those benefits. Spot pricing has improved, and certainly the contract, excuse me, the project work helps us with that. Those are generally more short-term in nature solutions, and so again, what we want to watch is through this whole fourth quarter, how's the second half, particularly of December play, how far can the e-com trend and the retail trend carry through the quarter? I think that'll determine where we are in the range from to the high end of the range to the mid part of the range or the lower part of the range, is really how strong that last couple, three weeks of December are. Yeah. But I guess as a sign, you're starting to see that spot, which does that mean enough capacity is coming out and you're getting a better balance? Is that because of the storms and because of pre-shipping and potential pre-shipping added tariffs? Is there a way to pinpoint it, or it doesn't matter to you? You're just seeing the backdrop improve? Yeah. I think what we're really trying to assess, Ken, to be more specific on that is how we can sustain those trends. We certainly saw that in June. We saw that in July, which were really encouraging. And then mid-August, through the end of the quarter, that same trend tempered. Now we're back into a more favorable October seasonality piece, spot pricing. And so how that sustains itself, I think, is more instructive to when we feel we can move the dial fast enough and far enough to be investable in our network business. Mark, just to wrap up for me, the intermodal versus the spot truckload business, is there one versus the other that you start to see that tightening or the improvement impact a little bit first, faster? Obviously, you've got the pre-shipping that moved the volumes up double-digit in the West, but I don't know if that's just a signal of rail service improving, or is there one that you would look to first? Is it rail or truck on seeing that tightening? Yeah. This is Jim. Ken, and part of this also is as market tightens, that customers aren't comparing an intermodal contract rate to a spot price. They start to look at a contract-to-contract to lock-in capacity. And so as you see that tightening, there's a little bit different comparison. And we have seen our truck pricing increasing at a little bit faster rate than over the road. And that would really be what will start to tighten and start to change that market. Historically, truck pricing moves before the intermodal pricing moves. Great. Thanks, guys. Appreciate it. Thanks, Ken. Your next question comes from the line of Bascome Majors from Susquehanna. Your line is open. Mark, we're seeing the large national network carriers, for the most part, do what we would think they need to do to restore balance in the one-way market by walking away from non-compensatory business, raising pricing on what's retained. And I guess from the brokerage results across the space, it doesn't feel like that business is going into the small carriers aggregated by brokers. So I don't know if you have a strong view on this, but internally, where do you think the people that are walking away from large national carriers in the one-way business are going right now? And ultimately, what does it take to force that segment of the market's hand and really restore a compensatory returns-driven framework to the industry? Thank you. Great. I totally understand the question there, Bascome. I think historically, the network business, both on a recovery and on a downturn, reacts the fastest, and in our historical perspective, a couple of percentage points of demand increase, a few percentage points of supply decrease starts to change the dynamics fairly quickly. We've just been in this long slog on the slow erosion of supply. I think eventually, when's the timing? We're trying not to totally predict that, but it does feel that we are at the bottom or close to the bottom that allows, I think, for those reactionary measures to start happening. I think our customers are also baffled a bit that it's taken this long, and particularly the sophisticated shipper that relies on trailer pools that looks at their network for long-term sustainable performance are also trying to hedge. I think that's part of why we're starting to see our ability to move price even ever so slightly is the realization that they're having as well that we're pretty long into this cycle. Do you have a sense within the competitive landscape what type or class of carrier is taking on flat-to-down rates at this point in the cycle? Our view to a third party is really through our brokerage group. And again, that's a much smaller in general carrier community versus a mid-size carrier. So I don't think it's the difficulty of our industry being so fragmented to have terrific visibility into all of those. But I think it calls for being disciplined. And really, that's our focus is enough erosion there. We have to start to get rate restoration to be compensable for our cost and to invest in the business. And Bascome, this is Jim. I'll just add a little bit of color from the perspective of our customers. As we're starting to approach their allocation season, we're having more strategic discussions with them. And the longer this cycle goes on, they're starting to ask more questions and listening, trying to understand the ability of the financial health of the carriers that they're working with. As they're making those questions, they're trying to put together solutions, looking at companies like us that have a broad portfolio, long stability to put those pieces together to be able to position their business wherever they need to go. Thanks, Jim. Thanks, Mark. Thank you. Your final question comes from a line of Bruce Chan from Stifel. Your line is open. Hey, thanks. And good morning, guys. Maybe just coming back to the side, I was interested to hear your comments about the volumes in the local East, just given that some of your competitors have been growing there. And I imagine that's an intentional decision not to maybe participate in the competitive market. But maybe any detail there, comments around whether there's something inherent in your asset-based strategy that makes the returns there less interesting? And I guess ultimately why you're seeing the decline there relative to others? Yeah, Bruce, this is Jim. Really, our strategy, as we talked about this going through the allocation season, is to remain disciplined, to maintain our profitability, and eventually improve there. Where I would say I see opportunities in the East going forward is really with the STB approval of this new connection between the CSX and CPKC. That's exciting for us because we really have an anchor position with both of those railroads. The connection between Texas and the Southeast, it's one of the largest rail opportunities that we have out there in the network. It is competitive with truck. But as we've been having discussions with customers, they're excited to have an option that they can start to look at that from an intermodal perspective. So I would say that's where we're expecting that we'll be able to grow the East. We've been using this interim timeframe to really understand what that potential is in that marketplace through our insights into the freight and our experience with our shippers over a multiple-year period, so that we can hit the ground running and already prepared once all of that becomes clear and we're ready to go, that we won't have much of a delay to get out in front of our customers on what value we can create by that new opportunity. Okay, and maybe just to continue on that opportunity theme, we've heard about maybe some service disruptions from some of your peers or one of your peers, wondering if that's anything you're seeing, and then as you think about the potential for PSR, one of the big rail service providers, any thoughts around how the competitive or pricing dynamic maybe changes as you go forward? Yeah. I'll start in the East. You think about what they've gone through with a port strike, two massive hurricanes, one that really covered the entire CSX network. It's amazing how quickly they responded and restored service to that rail line. It really shows the resiliency of their business operating with PSR. And then in terms of the potential changes in the West with the competing railroad and bringing in Ed Harris, I think it's a little bit too soon to tell. Clearly, they have some work to do from a margin management that could create opportunities for our partner in the West, the Union Pacific. Okay. Great. Appreciate that. This concludes today's conference call. Thank you for your participation. You may now disconnect.