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BUSINESS ACQUISITION
 3 Months Ended
Mar. 31, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
BUSINESS ACQUISITION BUSINESS ACQUISITION
On January 27, 2026, we acquired 100% of the equity interests in FirstEnterprises, Inc. (“FirstFleet”). Separately, under a real estate purchase agreement, we acquired 11 properties from FirstFleet. The purchase price in accordance with GAAP for this acquisition was $214.8 million, which is reflective of cash paid of $184.8 million as well as a contingent earnout valued at $30.0 million on the acquisition date. The contingent earnout is dependent on gross revenue net of fuel surcharge metrics for the period April 1, 2026 through March 31, 2027. The potential undiscounted future contingent earnout payment that we could be required to make is between $0 and $35.0 million. We funded these transactions using cash on hand and our existing revolving credit facility. The cash paid was reduced by the finance lease liabilities assumed in connection with the transaction.
Headquartered in Murfreesboro, Tennessee, FirstFleet brings added scale to Werner with approximately 2,400 tractors, 11,000 trailers and 37 strategically located properties near 130 customer sites around the country. The results of operations for FirstFleet are included in our consolidated financial statements beginning January 27, 2026. Revenues generated by FirstFleet are reported in our Dedicated operating segment within the Truckload Transportation Services (“TTS”) reportable segment. For the three months ended March 31, 2026, our consolidated operating results included FirstFleet revenues of $107.9 million and net income of $1.9 million. We incurred transaction costs related to the acquisition, such as legal and professional fees, of $5.9 million for the three months ended March 31, 2026, which is included in other operating expenses on the consolidated statements of income.
Provisional Purchase Price Allocation
We accounted for the FirstFleet purchase using the acquisition method of accounting under GAAP. The purchase price has been allocated to the assets acquired and liabilities assumed using market data and valuation techniques. The estimated fair values of the assets acquired and liabilities assumed are considered provisional for FirstFleet, pending the completion of acquired tangible assets valuations, the assessment of operating and finance leases right-of-use assets and related liabilities, independent valuation of acquired intangible assets, calculations of deferred taxes based upon the underlying tax basis of assets acquired and liabilities assumed and the income taxes receivable, and the determination of insurance reserve liabilities. The determination of estimated fair values requires management to make significant estimates and assumptions. We believe that the information available provides a reasonable basis for estimating the values of assets acquired and liabilities assumed in the FirstFleet acquisition; however, these provisional estimates may be adjusted upon the availability of new information regarding facts and circumstances which existed at the acquisition date, and such adjustments may impact future earnings. We expect to finalize the valuation of assets and liabilities for FirstFleet as soon as practicable, but not later than one year from the acquisition date. Any adjustments to the initial estimates of the fair value of the acquired assets and liabilities assumed in the FirstFleet acquisition will be recorded as adjustments to the respective assets and liabilities, with the residual amounts allocated to goodwill.
The following table summarizes the provisional purchase price allocation for FirstFleet as of March 31, 2026 (in thousands):
Provisional Purchase Price
Cash consideration paid
$177,387 
(1)
Contingent consideration arrangement
30,000 
(2)
Deferred cash payments
7,368 
(3)
Total provisional purchase price (fair value of consideration)
214,755 

Provisional Purchase Price Allocation
Accounts receivable, trade
77,250 
Inventories and supplies1,927 
Prepaid expenses8,007 
Other current assets3,130 
Property and equipment
175,573 
Finance lease right-of-use assets
57,195 
Goodwill9,472 
Intangible assets22,600 
Operating lease right-of-use assets
74,230 
Other non-current assets873 
Total assets acquired430,257 
Accounts payable10,464 
Insurance and claims accruals16,028 
Accrued payroll16,035 
Accrued expenses2,721 
Current maturities of operating lease liabilities35,627 
Current maturities of finance lease liabilities26,900 
Other current liabilities50 
Finance lease liabilities, less current maturities30,296 
Operating lease liabilities, less current maturities38,602 
Insurance and claims accruals, net of current portion25,870 
Deferred income taxes12,909 
Total liabilities assumed215,502 
Total provisional purchase price allocated$214,755 
(1) At closing, $11.9 million of the cash consideration was placed in escrow to secure certain indemnification obligations of the sellers and to cover post-closing adjustments.
(2) The estimated fair value of the FirstFleet contingent consideration arrangement was based upon probability-adjusted inputs for the acquired entity and is recorded in other current liabilities on the consolidated condensed balance sheet as of March 31, 2026. For additional information regarding the valuation of the contingent liability, see Note 7 – Fair Value.
(3) Deferred cash payments of $7.4 million were made during the three months ended March 31, 2026.
The following unaudited pro forma information combines the historical operations of the Company and FirstFleet giving effect to the FirstFleet acquisition, and related transactions as if consummated on January 1, 2025, the beginning of the comparable prior annual reporting period. The unaudited pro forma financial information is based on currently available information, is presented for informational purposes only, and is not indicative of future operations or results had the FirstFleet acquisition been completed as of January 1, 2025 or any other date.
The following table summarizes the unaudited pro forma financial information (in thousands):
Three Months Ended
March 31,
20262025
Operating revenues$858,382 $866,103 
Net income (loss)
8,648 (13,585)
Earnings (loss) per share - basic
0.14 (0.22)
Earnings (loss) per share - diluted
0.14 (0.22)
The unaudited pro forma financial information includes certain adjustments such as recognition of assets acquired at estimated fair values and related depreciation and amortization, interest expense on acquisition financing, elimination of transaction costs incurred by the Company and FirstFleet that were directly related to the acquisition, and related income tax effects of these items. The adjustments do not reflect potential revenue enhancements, cost savings or operating synergies that we expect to realize after the acquisition.
Goodwill and Intangible Assets
Goodwill represents the excess of cost over the fair value of net identifiable tangible and intangible assets acquired in a business combination. Goodwill and intangible assets with indefinite lives are not amortized. Goodwill is reviewed for potential impairment on an annual basis or more frequently if indicators of a potential impairment exist. Goodwill associated with the acquisition was primarily attributable to acquiring and retaining the existing FirstFleet network and the anticipated synergies from combining the operations of the Company and FirstFleet. None of the goodwill associated with the acquisition is expected to be deductible for income tax purposes. All goodwill is assigned to our TTS segment.
We preliminarily allocated $22.6 million of the purchase price to finite-lived intangible assets, consisting of customer relationships. The estimated fair values of the intangible assets were determined, with the assistance of an independent third-party valuation firm, using the multi-period excess earnings method. This method is a form of the income approach, which requires a forecast of all the expected future cash flows.
The following table summarizes the acquired intangible assets and the respective weighted-average estimated amortization period:
 Estimated Fair Value
(in thousands)		Weighted-Average Estimated
Amortization Period
(Years)
Customer relationships$22,600 10