Covenant Logistics Non-GAAP EPS of $0.44 in-line, revenue of $296.89M beats by $6.69M

* Covenant Logistics press release [https://seekingalpha.com/pr/20276197-covenant-logistics-group-announces-third-quarter-2025-financial-and-operating-results] (NYSE:CVLG [https://seekingalpha.com/symbol/CVLG]): Q3 Non-GAAP EPS of $0.44 in-line.
* Revenue of $296.89M (+3.1% Y/Y) beats by $6.69M.
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Outlook

Mr. Parker concluded, “Our outlook is impacted by both short-term and long-term factors. In the short term, we expect our Adjusted EPS for the fourth quarter to be sequentially lower than our Adjusted EPS for the third quarter. The reasons include expected lower profits from our minority investment in TEL attributable to credit losses in their small-carrier customer base, the impact of the U.S. government shutdown on our Department of Defense business, an expected increase in claims accruals, and loss of a large Managed Freight customer rolling off faster than the results of Star Logistics Solutions ramp. These negative factors are expected to more than outweigh our current expectation of a modest peak season boost to Expedited and Managed Freight.

“Over the intermediate to long term, I am more excited today than I have been in the last three years. From a freight environment perspective, capacity exits seem to be accelerating based on publicly announced bankruptcies of small carriers and our observation of TEL’s customer base, as well as increased enforcement of government policies concerning English language and non-domiciled drivers. In addition, there are potential demand drivers from unwinding excess inventories from import pull-forwards, tax and monetary policies, and clarification of trade policy. We have internal plans and opportunities to continue to grow certain dedicated and warehouse business that has the potential to yield acceptable margins and hold or downsize our other Truckload capacity until returns improve. To the extent we downsize capacity, we may experience severance, equipment disposal, and other costs that create uneven results in a given quarter but are expected to lead to stronger and more sustained results over time.

“In sum, we expect improving market conditions and our internal plan to produce operating leverage and higher earnings and return on capital over time, although individual quarters may be volatile. With an experienced team, an attractive business mix, and a disciplined approach to capital allocation, we believe Covenant is well-positioned for the future.”

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* Seeking Alpha’s Quant Rating on Covenant Logistics [https://seekingalpha.com/symbol/CVLG/ratings/quant-ratings]
* Historical earnings data for Covenant Logistics [https://seekingalpha.com/symbol/CVLG/earnings]
* Dividend scorecard for Covenant Logistics [https://seekingalpha.com/symbol/CVLG/dividends/scorecard]
* Financial information for Covenant Logistics [https://seekingalpha.com/symbol/CVLG/income-statement]