Freight delivery company Knight-Swift Transportation (NYSE: KNX) met Wall Street’s revenue expectations in Q1 CY2026, with sales up 1.4% year on year to $1.85 billion. Its non-GAAP profit of $0.09 per share was 46.7% below analysts’ consensus estimates.

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Company Overview

Covering 1.6 billion loaded miles in 2023 alone, Knight-Swift Transportation (NYSE: KNX) offers less-than-truckload and full truckload delivery services.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Thankfully, Knight-Swift Transportation’s 9.5% annualized revenue growth over the last five years was solid. Its growth beat the average industrials company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Knight-Swift Transportation’s recent performance shows its demand has slowed as its annualized revenue growth of 1.1% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

This quarter, Knight-Swift Transportation grew its revenue by 1.4% year on year, and its $1.85 billion of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 8.9% over the next 12 months, an improvement versus the last two years. This projection is above the sector average and indicates its newer products and services will spur better top-line performance.

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Operating Margin

Knight-Swift Transportation was profitable over the last five years but held back by its large cost base. Its average operating margin of 7.5% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.

Looking at the trend in its profitability, Knight-Swift Transportation’s operating margin decreased by 14.3 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Knight-Swift Transportation’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.

This quarter, Knight-Swift Transportation generated an operating margin profit margin of 1.5%, down 2.1 percentage points year on year. Conversely, its revenue and gross margin actually rose, so we can assume it was less efficient because its operating expenses like marketing, R&D, and administrative overhead grew faster than its revenue.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Sadly for Knight-Swift Transportation, its EPS declined by 19.3% annually over the last five years while its revenue grew by 9.5%. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

We can take a deeper look into Knight-Swift Transportation’s earnings to better understand the drivers of its performance. As we mentioned earlier, Knight-Swift Transportation’s operating margin declined by 14.3 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Knight-Swift Transportation, its two-year annual EPS declines of 1.8% show it’s still underperforming. These results were bad no matter how you slice the data.

In Q1, Knight-Swift Transportation reported adjusted EPS of $0.09, down from $0.28 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects Knight-Swift Transportation’s full-year EPS of $1.07 to grow 103%.

Key Takeaways from Knight-Swift Transportation’s Q1 Results

We struggled to find many positives in these results. Its EBITDA missed and its EPS fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 2.3% to $62.47 immediately following the results.

Knight-Swift Transportation’s latest earnings report disappointed. One quarter doesn’t define a company’s quality, so let’s explore whether the stock is a buy at the current price. When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).