Old Dominion halts revenue slide as pricing holds
The less-than-truckload carrier posted a 2.9% year-over-year revenue decline, its smallest in five quarters.
Old Dominion Freight Line (ODFL) arrested its revenue slide in the first quarter, as the less-than-truckload carrier’s volumes stabilized and pricing discipline offset weaker freight demand. The company reported a 2.9% year-over-year decline in total revenue to $1.335 billion, an improvement from the 5.7% drop in the prior quarter.
The quarter marked the fifth consecutive period of year-over-year revenue contraction, but the slowest rate of decline since the third quarter of 2024. Management attributed the moderation to a deceleration in volume erosion and sustained yield growth, even as the broader freight cycle remained subdued. LTL tons per day fell 7.7% year-over-year, a smaller drop than the 10.7% decline in the fourth quarter, while shipments per day declined 7.9%, improving from a 9.7% contraction in the prior period.
Revenue for the company’s core LTL segment mirrored the total, declining 2.9% to $1.322 billion. Pricing power held firm, with LTL revenue per hundredweight (excluding fuel surcharges) rising 4.4% year-over-year, though the pace of growth slowed slightly from 4.9% in the fourth quarter. The combination of softer volumes and higher rates left operating margins under pressure. The operating ratio deteriorated to 76.2% from 75.4% a year earlier, extending a streak of margin compression that began in mid-2025.
Earnings per share declined 4.2% year-over-year to $1.14, a sharper drop than the revenue decline but an improvement from the 11.4% contraction in the prior quarter. The company said the bottom-line performance reflected higher labor and maintenance costs, partially offset by productivity gains from network optimization.
Capital expenditures for 2026 remained guided at $265 million, unchanged from the prior quarter’s outlook. Share repurchases slowed to $88.1 million in the quarter, down from $730.3 million for the full year 2025, as the company prioritized liquidity amid the freight downturn. Old Dominion also raised its quarterly dividend 3.6% year-over-year to $0.29 a share, signaling confidence in cash flow durability despite the cyclical headwinds.
Average active full-time employees fell 7.1% year-over-year to 20,264, reflecting ongoing capacity adjustments to match lower shipment levels. The company said it expects to maintain a leaner workforce until demand recovers, though it continues to invest in service quality and network density to protect market share.