[Management View]
Wabash National reported Q2 2025 consolidated revenue of $459 million, at the high end of guidance. Key metrics include 8,640 new trailers and 3,190 truck bodies shipped. Gross margin was 9%, with breakeven adjusted operating margins. Adjusted EBITDA was $16 million, or 3.6% of sales. The company highlighted structural revenue momentum in Parts and Services, achieving 15% sequential and 8.8% year-over-year growth.

[Outlook]
Management lowered full-year 2025 guidance due to persistent end-market demand weakness and industry-wide CapEx reductions. Revenue is guided to approximately $1.6 billion and EPS to negative 1.2 to negative 1.3 for 2025. Q3 2025 revenue is expected between $390 million and $430 million, with EPS guidance of negative $0.20 to negative $0.30. The company remains cautiously optimistic for 2026, expecting a return to growth if market conditions stabilize.

[Financial Performance]
- Consolidated revenue: $459 million in Q2 2025
- Gross margin: 9%
- Adjusted EBITDA: $16 million (3.6% of sales)
- Adjusted net income: Negative $6.1 million, or negative $0.15 per diluted share
- Transportation Solutions revenue: $400 million
- Parts and Services revenue: $60 million

[Q&A Highlights]
Question 1: Brent, just looking at 2026 or the overall trailer cycle, what has to happen for order rates to pick up? Are you hoping that post might be entering the trailer fleet market and making the market a little smaller for those who are left? (Line breaks here)
Answer: Capacity coming out of the market is the main factor. Customers believe enough is starting to exit, allowing for directional capital deployment in line with expectations. The secondary factor is the fundamental freight-producing subsectors of the market, which would be a positive precipitating event.

Question 2: Has the industry gotten more efficient over the last couple of years? Have you used AI or more efficient load boards? (Line breaks here)
Answer: There is no substantial efficiency at scale through technology deployment at this moment. The net inefficiency is still greater than efficiency being created. However, there are inroads happening at the fleets, and platforms are being built that show promise.

Question 3: Can you give us more detail on the parts and service growth? Do you think the trajectory will continue into 2026? (Line breaks here)
Answer: The parts initiative and PPN expansion are gaining traction. The second half of 2025 is expected to be 20% better than the first half. Sustainable growth levels are being reached, and the trajectory is expected to continue into 2026.

Question 4: Does the $30 million to $40 million in CapEx include the investment in Trailers as a Service? (Line breaks here)
Answer: It does not. The traditional CapEx is separate from the TaaS investment, which was roughly $21 million through the first half of the year.

Question 5: What is driving the average sales price drop in the transportation business? (Line breaks here)
Answer: The sequential ASP drop is almost entirely mix-driven, with an increase in the percentage of dry vans. On a like-for-like basis, ASP would be relatively flat compared to the first quarter.

Question 6: How much of the 2025 guidance loss is due to market conditions versus new projects and investments? (Line breaks here)
Answer: The top-line drop is entirely market-driven. SG&A expenses related to investments are ongoing, but cost actions have been taken to align with market realities.

Question 7: Are we in the darkest part of the trailer cycle, and what gives you enthusiasm for a better 2026? (Line breaks here)
Answer: Being below replacement is a significant issue. Prominent carriers are maintaining margins and will need to spend to catch up. If current conditions hold, slight improvements in spot rates could lead to increased spending in 2026.

[Sentiment Analysis]
The tone of the management was cautiously optimistic, focusing on strategic adjustments and cost management. Analysts' questions reflected concerns about market conditions and the potential for future growth.

[Quarterly Comparison]
| Metric | Q2 2025 | Q1 2025 | Q2 2024 |
|-------------------------------|---------------|---------------|---------------|
| Consolidated Revenue | $459 million | $420 million | $500 million |
| Gross Margin | 9% | 8% | 10% |
| Adjusted EBITDA | $16 million | $14 million | $20 million |
| Adjusted Net Income | -$6.1 million | -$5 million | $2 million |
| Transportation Solutions Rev. | $400 million | $380 million | $450 million |
| Parts and Services Rev. | $60 million | $55 million | $50 million |

[Risks and Concerns]
- Continued market softness and economic uncertainty
- Decline in backlog to approximately $1 billion
- Negative operating cash flow and free cash flow
- Ongoing legal risks related to a 2019 motor vehicle accident

[Final Takeaway]
Wabash National faced significant market challenges in Q2 2025, leading to a reduction in full-year guidance. Despite these headwinds, the company demonstrated resilience through strategic cost management and growth in the Parts and Services segment. Management remains cautiously optimistic about 2026, contingent on market stabilization and customer capital spending recovery. Investors should monitor market conditions and Wabash's ability to navigate economic uncertainties while capitalizing on growth opportunities in its diversified segments.