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10-K – 2026-02-24 – jbht20251231_10k.htm
We account for our restricted share units and performance share units in accordance with current accounting standards for share-based payments. These standards require that the cost of all share-based payments to employees be recognized in our Consolidated Financial Statements based on the grant date fair value of those awards. This cost is recognized over the period for which an employee is required to provide service in exchange for the award, subject to the attainment of performance metrics established for performance share units. The quantity of performance share units for which it is probable that the performance conditions will be achieved is estimated each reporting period, with any necessary adjustments recorded as a cumulative cost adjustment in the current period. Share-based compensation expense is recorded in salaries, wages, and employee benefits in our Consolidated Statements of Earnings, along with other compensation expenses to employees. The following table summarizes the components of our share-based compensation program expense (in thousands): Years ended December 31, 2025 2024 2023 Restricted share units Pretax compensation expense $ 55,177 $ 49,172 $ 56,837 Tax benefit 13,607 12,214 12,561 Restricted share units, net of tax $ 41,570 $ 36,958 $ 44,276 Performance share units Pretax compensation expense $ 16,576 $ 16,514 $ 22,352 Tax benefit 4,088 4,102 4,940 Performance share awards, net of tax $ 12,488 $ 12,412 $ 17,412 A summary of our restricted share units and performance share units is as follows: Restricted Share Units Number of Shares Weighted Average Grant Date Fair Value Unvested at December 31, 2024 737,237 $ 163.83 Granted 344,140 162.66 Vested ( 372,223 ) 157.29 Forfeited ( 24,147 ) 181.65 Unvested at December 31, 2025 685,007 $ 166.14 Performance Share Units Number of Shares Weighted Average Grant Date Fair Value Unvested at December 31, 2024 352,291 $ 179.14 Granted 104,360 164.79 Vested ( 84,001 ) 172.53 Forfeited ( 35,124 ) 188.22 Unvested at December 31, 2025 337,526 $ 175.40 At December 31, 2025, we had $ 54.9 million and $ 29.8 million of total unrecognized compensation expense related to restricted share units and performance share units, respectively, that is expected to be recognized over the remaining weighted average vesting period of approximately 2.8 years for restricted share units and 2.0 years for performance share units. The aggregate intrinsic value of restricted and performance share units vested during the years ended December 31, 2025, 2024, and 2023, was $ 76.5 million, $ 105.4 million, and $ 104.0 million, respectively. The aggregate intrinsic value of unvested restricted and performance share units was $ 198.7 million at December 31, 2025. The total fair value of shares vested for restricted share and performance share plans during the years ended December 31, 2025, 2024, and 2023, was $ 73.3 million, $ 83.8 million, and $ 73.8 million, respectively. 48 6. Income Taxes Income before provision for income taxes was as follows: Years ended December 31, 2025 2024 2023 United States $ 772,284 $ 742,432 $ 929,054 Foreign 21,828 17,084 5,833 Income before income taxes $ 794,112 $ 759,516 $ 934,887 Income tax expense attributable to earnings before income taxes consists of (in thousands): Years ended December 31, 2025 2024 2023 Current: Federal $ 170,563 $ 244,770 $ 106,004 State and local 7,384 25,328 35,030 Foreign 5,827 8,380 - 183,774 278,478 141,034 Deferred: Federal ( 2,541 ) ( 88,016 ) 66,000 State and local 14,597 ( 1,832 ) ( 434 ) 12,056 ( 89,848 ) 65,566 Total tax expense/(benefit) $ 195,830 $ 188,630 $ 206,600 Income tax expense attributable to earnings before income taxes differed from the amounts computed using the statutory federal income tax rate of 21 % for the following reasons (in thousands): Years ended December 31, 2025 2024 2023 Amount % Amount % Amount % U.S. federal statutory rate $ 166,764 21.0 % $ 159,498 21.0 % $ 196,326 21.0 % State tax, net of federal effect* 32,159 4.1 31,114 4.1 37,594 4.0 Foreign tax Effects - - 5,895 0.8 ( 1,002 ) ( 0.1 ) Tax credits ( 10,043 ) ( 1.3 ) ( 1,754 ) ( 0.2 ) ( 3,829 ) ( 0.4 ) Nontaxable or nondeductible items: Federal 1341 claim 18,090 2.3 Other 6,276 0.8 9,956 1.3 2,476 0.3 Changes in unrecognized tax benefits: ( 17,547 ) ( 2.2 ) ( 12,648 ) ( 1.7 ) ( 21,968 ) ( 2.4 ) Other, net 131 - ( 3,431 ) ( 0.5 ) ( 2,997 ) ( 0.3 ) Effective Tax Rate $ 195,830 24.7 % $ 188,630 24.8 % $ 206,600 22.1 % * State taxes for California, Illinois, Indiana, New York & Pennsylvania for 2025, and California, Illinois, New York & Pennsylvania for 2024 and 2023 made up the majority (greater than 50%) of the tax effect in this category. 49 Income taxes receivable was $ 34.9 million and $ 116.7 million at December 31, 2025 and 2024, respectively. These amounts have been included in other receivables in our Consolidated Balance Sheets. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2025 and 2024, are presented below (in thousands): December 31, 2025 2024 Deferred tax assets: Insurance accruals $ 83,380 $ 69,168 Allowance for doubtful accounts 12,149 12,584 Compensation accrual 15,881 9,882 Deferred compensation accrual 24,484 26,805 Federal benefit of state uncertain tax positions 16,377 17,693 Lease liabilities 60,849 74,858 State NOL carry-forward 2,602 4,235 Other 1,112 3,815 Total gross deferred tax assets 216,834 219,040 Valuation allowance ( 2,602 ) ( 4,235 ) Total deferred tax assets, net of valuation allowance 214,232 214,805 Deferred tax liabilities: Plant and equipment, principally due to differences in depreciation 1,031,019 1,001,537 Prepaid permits and insurance, principally due to expensing for income tax purposes 31,721 35,592 Lease right-of-use assets 59,797 73,925 Total gross deferred tax liabilities 1,122,537 1,111,054 Net deferred tax liability $ 908,305 $ 896,249 The amounts of cash income taxes paid by the Company were as follows: Years Ended December 31, 2025 2024 2023 Federal $ 101,890 $ 275,594 $ 97,386 State and local: California 1,903 2,068 7,037 Illinois 4,848 8,697 14,565 Other 9,099 14,289 14,549 Total State and local 15,850 25,054 36,151 Foreign 5,764 4,455 1,848 Income taxes, net of amounts refunded $ 123,504 $ 305,103 $ 135,385 On July 4, 2025, new U.S. tax legislation was signed into law which made permanent many of the tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act that were set to expire at the end of 2025. In addition, the legislation made changes to certain U.S. Corporate tax provisions. This new legislation did not have a material impact on our Consolidated Financial Statements. 50 Guidance on accounting for uncertainty in income taxes prescribes recognition and measurement criteria and requires that we assess whether the benefits of our tax positions taken are more likely than not of being sustained under tax audits. We have made adjustments to the balance of unrecognized tax benefits, a component of other long-term liabilities on our Consolidated Balance Sheets, as follows (in millions): December 31, 2025 2024 2023 Beginning balance $ 78.0 $ 80.9 $ 89.1 Additions based on tax positions related to the current year 11.5 13.3 16.2 Additions/(reductions) based on tax positions taken in prior years ( 4.7 ) ( 2.9 ) 0.5 Reductions due to settlements ( 2.7 ) ( 1.4 ) ( 14.6 ) Reductions due to lapse of applicable statute of limitations ( 14.4 ) ( 11.9 ) ( 10.3 ) Ending balance $ 67.7 $ 78.0 $ 80.9 At December 31, 2025 and 2024, we had a total of $ 67.7 million and $ 78.0 million, respectively, in gross unrecognized tax benefits. Of these amounts, $ 54.8 million and $ 63.4 million represent the amount of unrecognized tax benefits that, if recognized, would impact our effective tax rate in 2025 and 2024, respectively. Interest and penalties related to income taxes are classified as interest expense in our Consolidated Statements of Earnings. The amount of accrued interest and penalties recognized during the years ended December 31, 2025, 2024, and 2023, was $ 7.2 million, $ 7.8 million, and $ 5.3 million, respectively. Future changes to unrecognized tax benefits will be recognized as income tax expense and interest expense, as appropriate. The total amount of accrued interest and penalties for such unrecognized tax benefits at December 31, 2025 and 2024, was $ 13.6 million and $ 13.1 million, respectively. No material change in unrecognized tax benefits is expected in the next 12 months. Tax years 2020 and forward remain subject to examination by federal tax jurisdictions, while tax years 2018 and forward remain open for state jurisdictions. 7. Employee Benefit Plans We maintain a defined contribution employee retirement plan, which includes a 401(k) option, under which all employees are eligible to participate. We match a specified percentage of employee contributions, subject to certain limitations. For the years ended December 31, 2025, 2024, and 2023, our matching contributions to the plan were $ 35.8 million, $ 35.2 million, and $ 34.3 million, respectively. We have a nonqualified deferred compensation plan that allows eligible employees to defer a portion of their compensation. The compensation deferred under this plan is credited with earnings or losses on investments elected by plan participants. Each participant is fully vested in all deferred compensation and earnings; however, these amounts are subject to general creditor claims until actually distributed to the employee. A participant may elect to receive deferred amounts in one payment or in quarterly installments payable over a period of 2 to 25 years upon reaching age 55 , having 15 years of service, or becoming disabled. Our total liability under this plan was $ 36.3 million as of December 31, 2025, and $ 33.9 million as of December 31, 2024. These amounts are included in other long-term liabilities in our Consolidated Balance Sheets. Participant withholdings are held by a trustee and invested in equity securities as directed by participants. These investments are classified as trading securities and recorded at fair value. Realized and unrealized gains and losses are recognized currently in earnings. The investments are included in other assets in our Consolidated Balance Sheets and totaled $ 36.3 million as of December 31, 2025, and $ 33.9 million as of December 31, 2024. 51 8. Fair Value Measurements Assets and Liabilities Measured at Fair Value on a Recurring Basis Our assets and liabilities measured at fair value are based on valuation techniques which consider prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. These valuation methods are based on either quoted market prices (Level 1) or inputs, other than quoted prices in active markets, that are observable either directly or indirectly (Level 2). The following are assets and liabilities measured at fair value on a recurring basis (in millions): Asset/(Liability) Balance December 31, 2025 2024 Input Level Trading investments $ 36.3 $ 33.9 1 The fair value of trading investments has been measured using the market approach (Level 1) and reflect quoted market prices. Trading investments are classified in other assets in our Consolidated Balance Sheets. Financial Instruments The carrying amount of our senior credit facility and senior notes not measured at fair value on a recurring basis was $ 1.47 billion and $ 1.48 billion at December 31, 2025 and 2024, respectively. The estimated fair value of these liabilities using the income approach (Level 2), based on their net present value, discounted at our current borrowing rate, was $ 1.51 billion and $ 1.48 billion at December 31, 2025 and 2024, respectively. The carrying amounts of all other instruments at December 31, 2025 and 2024, approximate their fair value due to the short maturity of these instruments. 9. Commitments and Contingencies At December 31, 2025, we had outstanding commitments of approximately $ 107.3 million, net of proceeds from sales or trade-ins, during the year 2026, which is primarily related to the acquisition of tractors, containers, chassis, and other trailing equipment. During 2025, we issued financial standby letters of credit as a guaranty of our performance under certain operating agreements and self-insurance arrangements. If we default on our commitments under the agreements or other arrangements, we are required to perform under these guaranties. The undiscounted maximum amount of our obligation to make future payments in the event of defaults is approximately $ 1.5 million as of December 31, 2025. As the result of state use tax audits, we have been assessed amounts owed from which we are vigorously appealing. We have recorded a liability for the estimated probable exposure under these audits and await resolution of the matter. We purchase insurance coverage for a portion of expenses related to vehicular collisions and accidents. These policies include a level of self-insurance (deductible) coverage applicable to each claim as well as certain coverage-layer-specific, aggregated reimbursement limits of covered excess claims. Our claims from time to time exceed some of these existing coverage layer aggregate reimbursement limits. We have recorded liabilities to reflect our estimate of exposure for excess claims which have developed in maturity and severity, which are included in our total claims accrual, discussed further in Note 2, Summary of Significant Accounting Policies. We are involved in certain other claims and pending litigation arising from the normal conduct of business. Based on present knowledge of the facts and, in certain cases, opinions of outside counsel, we believe the resolution of these claims and pending litigation will not have a material adverse effect on our financial condition, results of operations or liquidity. 52 10. Leases As of December 31, 2025, we had various obligations remaining under operating lease arrangements related primarily to the rental of maintenance and support facilities, cross-dock and delivery system facilities, office space, parking yards and equipment. Many of these leases include one or more options, at our discretion, to renew and extend the agreement beyond the current lease expiration date or to terminate the agreement prior to the lease expiration date. These options are included in the calculation of our operating lease right-of-use asset and liability when it becomes reasonably certain the option will be exercised. Our lease obligations typically do not include options to purchase the leased property, nor do they contain residual value guarantees or material restrictive covenants. Operating leases with an initial term of more than 12 months are included in our Consolidated Balance Sheets as discounted liabilities and corresponding right-of-use assets consisting of the following (in millions): Asset/(Liability) Balance December 31, 2025 2024 Right-of-use assets $ 249.3 $ 308.2 Lease liabilities, current ( 85.6 ) ( 98.1 ) Lease liabilities, long-term ( 168.1 ) ( 214.0 ) Right-of-use assets are classified in other assets in our Consolidated Balance Sheets. Operating lease liability, current is classified in other accrued expenses, while operating lease liability, long-term is classified in other long-term liabilities in our Consolidated Balance Sheets. As of December 31, 2025 and 2024, the weighted-average remaining lease term for our outstanding operating lease obligations was 4.5 years and 4.9 years, respectively. As of December 31, 2025 and 2024, the weighted-average discount rate was 4.35 % and 4.22 %, respectively. Future minimum lease payments under these operating leases as of December 31, 2025, are as follows (in millions): 2026 $ 87.6 2027 65.7 2028 43.5 2029 27.8 2030 18.6 Thereafter 35.5 Total lease payments 278.7 Less interest ( 25.0 ) Present value of lease liabilities $ 253.7 During the years ended December 31, 2025, 2024, and 2023, cash paid for amounts included in the measurement of operating lease liabilities was $ 106.8 million, $ 109.9 million, and $ 106.2 million, while $ 106.7 million, $ 110.8 million, and $ 106.8 million of operating lease expense was recognized on a straight-line basis, respectively. Operating lease expense is recorded in general and administrative expenses, including asset dispositions in our Consolidated Statements of Earnings. During the years ended December 31, 2025, 2024, and 2023, a total of $ 39.3 million, $ 78.9 million, and $ 159.7 million of right-of-use assets were obtained in exchange for new operating lease liabilities, of which, $ 9.1 million was obtained through business combinations in 2023. 53 11. Acquisitions On September 14, 2023, we entered into an asset purchase agreement to acquire substantially all of the brokerage assets and assume certain specified liabilities of BNSF Logistics, LLC (BNSFL), an affiliate of Burlington Northern Santa Fe, LLC, subject to customary closing conditions. The closing of the transaction was effective on September 30, 2023, with a purchase price of $ 85.0 million. Total consideration paid in cash under the BNSFL agreement was $ 81.2 million and consisted of the agreed upon purchase price paid in 2023, reduced for estimated working capital adjustments received in 2024. Transaction costs incurred were not material. The BNSFL acquisition was accounted for as a business combination and operates within our ICS business segment. Assets acquired and liabilities assumed were recorded in our Consolidated Balance Sheet at their estimated fair values, as of the closing date, using cost, market data and valuation techniques that reflect management’s judgment and estimates. As a result of the acquisition, we recorded approximately $ 38.5 million of definite-lived intangible assets and approximately $ 13.6 million of goodwill. Goodwill consists of acquiring and retaining the BNSFL existing brokerage network and expected synergies from the combination of operations. 12. Goodwill and Other Intangible Assets Total goodwill was $ 134.0 million at December 31, 2025 and 2024. At December 31, 2025, $ 111.6 million, $ 13.6 million and $ 8.8 million of our goodwill was assigned to our FMS, ICS, and JBI business segments, respectively. No impairment losses have been recorded for goodwill as of December 31, 2025. Our intangible assets consisted of those arising from previous business acquisitions within our FMS, ICS, and JBI segments. Identifiable intangible assets consist of the following (in millions): Weighted Average December 31, Amortization 2025 2024 Period Finite-lived intangibles: Customer relationships $ 189.8 $ 189.8 10.7 Non-competition agreements 9.7 10.6 6.0 Trade names - - Total finite-lived intangibles 199.5 200.4 Less accumulated amortization ( 123.2 ) ( 103.4 ) Total identifiable intangible assets, net $ 76.3 $ 97.0 Our finite-lived intangible assets have no assigned residual values. During the years ending December 31, 2025, 2024, and 2023, intangible asset amortization expense was $ 20.6 million, $ 37.0 million and $ 20.5 million, respectively. During the year ending December 31, 2024, we recorded expense of $ 14.4 million for the impairment of certain customer relationships intangible assets related to the BNSFL acquisition. Estimated amortization expense for our finite-lived intangible assets is expected to be approximately $ 19.7 million for 2026, $ 15.6 million for 2027, $ 9.7 million for 2028, $ 9.5 million for 2029, and $ 8.6 million for 2030. Actual amounts of amortization expense may differ from estimated amounts due to additional intangible asset acquisitions, impairment or accelerated amortization of intangible assets, and other events. 54 13. Segment Information We have five reportable business segments which are based primarily on the services each segment provides. The JBI segment includes freight that is transported by rail over at least some portion of the movement and also includes certain repositioning truck freight moved by JBI equipment or third-party carriers, when such highway movement is intended to direct JBI equipment back toward intermodal operations. DCS segment business includes company-owned and customer-owned, DCS-operated revenue equipment and employee drivers assigned to a specific customer, traffic lane, or service. DCS operations usually include formal, written longer-term agreements or contracts that govern services performed and applicable rates. ICS provides non-asset and asset-light transportation solutions to customers through relationships with third-party carriers and integration with company-owned equipment. ICS services include flatbed, refrigerated, and expedited, as well as a variety of dry-van and intermodal solutions. ICS further offers these services through an online multimodal marketplace via J.B. Hunt 360 that matches the right load with the right carrier and the best mode. FMS provides last-mile delivery services to customers through a nationwide network of cross-dock and other delivery system network locations. FMS provides both asset and non-asset big and bulky delivery and installation services, as well as fulfillment, retail-pooling distributions, and LTL services. JBT business includes full-load, dry-van freight that is transported using independent contractors or third-party carriers utilizing company-owned trailing equipment as well as services through our J.B. Hunt 360box program which utilizes the J.B. Hunt 360 platform to access capacity and offer efficient drop trailer solutions to customers. This freight is typically transported over roads and highways and does not move by rail. All transactions between reporting segments are eliminated in consolidation. Our President and Chief Executive Officer serves as our Chief Operating Decision Maker (CODM) and is responsible for reviewing segment performance and making decisions regarding capital and personnel allocations. Our measure of profit or loss for segment reporting purposes provided to the CODM is operating income. The CODM considers operating income budget-to-actual variances on a monthly basis to assess the performance for each of our segments. Effectively all corporate support expenses are allocated to our operating segments within various expense line items presented. Assets reported by our corporate support group are not allocated. Intersegment revenues and corresponding expenses included in our segment reporting are eliminated upon consolidation. Our customers are geographically dispersed across the United States. A summary of certain segment information is presented below (in millions): Assets (Excludes intercompany accounts) December 31, 2025 2024 2023 JBI $ 3,324 $ 3,507 $ 3,391 DCS 2,070 2,195 2,355 ICS 286 288 350 FMS 485 544 634 JBT 364 389 419 Total segment assets 6,529 6,923 7,149 Other (includes corporate) 1,398 1,389 1,439 Total $ 7,927 $ 8,312 $ 8,588 55 Net Capital Expenditures (1) For The Twelve Months Ended December 31, 2025 2024 2023 JBI $ 163 $ 322 $ 536 DCS 228 153 716 ICS 1 20 2 FMS 10 15 36 JBT 1 14 30 Total segment net capital expenditures 403 524 1,320 Other (includes corporate) 172 150 280 Total $ 575 $ 674 $ 1,600 Revenues and Operating Income/(Loss) For The Year ended December 31, 2025 JBI DCS ICS FMS JBT Intersegment Eliminations Consolidated Total operating revenues $ 5,975 $ 3,376 $ 1,109 $ 824 $ 734 $ ( 19 ) $ 11,999 Operating expenses: Rents, purchased transportation, and fuel 3,716 430 958 306 547 Salaries, wages and employee benefits 877 1,531 67 286 41 Depreciation and amortization 247 317 8 45 26 Operating supplies and expenses 259 283 7 38 30 Insurance and claims 115 174 16 23 25 General and administrative expenses, including asset dispositions 278 205 62 92 42 Other segment items (2) 33 59 1 7 2 Total operating expenses 5,525 2,999 1,119 797 713 ( 19 ) 11,134 Operating Income (3) $ 450 $ 377 $ ( 10 ) $ 27 $ 21 $ - $ 865 Revenues and Operating Income/(Loss) For The Year ended December 31, 2024 JBI DCS ICS FMS JBT Intersegment Eliminations Consolidated Total operating revenues $ 5,956 $ 3,396 $ 1,141 $ 910 $ 702 $ ( 18 ) $ 12,087 Operating expenses: Rents, purchased transportation, and fuel 3,791 451 967 330 509 Salaries, wages and employee benefits 844 1,528 79 310 43 Depreciation and amortization 249 330 35 46 36 Operating supplies and expenses 244 276 8 41 27 Insurance and claims 106 173 21 14 20 General and administrative expenses, including asset dispositions 260 202 86 101 44 Other segment items (2) 32 60 1 8 2 Total operating expenses 5,526 3,020 1,197 850 681 ( 18 ) 11,256 Operating Income (3) $ 430 $ 376 $ ( 56 ) $ 60 $ 21 $ - $ 831 56 Revenues and Operating Income/(Loss) For The Year ended December 31, 2023 JBI DCS ICS FMS JBT Intersegment Eliminations Consolidated Total operating revenues $ 6,208 $ 3,543 $ 1,390 $ 918 $ 789 $ ( 18 ) $ 12,830 Operating expenses: Rents, purchased transportation, and fuel 3,986 538 1,225 319 574 Salaries, wages and employee benefits 808 1,552 87 325 50 Depreciation and amortization 256 327 6 48 44 Operating supplies and expenses 228 285 8 45 31 Insurance and claims 100 161 30 23 23 General and administrative expenses, including asset dispositions 230 214 77 101 48 Other segment items (2) 31 61 1 10 3 Total operating expenses 5,639 3,138 1,434 871 773 ( 18 ) 11,837 Operating Income (3) $ 569 $ 405 $ ( 44 ) $ 47 $ 16 $ - $ 993 (1) Net capital expenditures report the additions to property and equipment, net of proceeds from the sale of property and equipment. (2) Other segment items include communication, utilities, and operating taxes and licenses expense items. (3) Refer to the Consolidated Statements of Earnings for the reconciliation of consolidated operating income to earnings before income taxes. 57