Ryder System Inc.

Company Overview

Business Model: Ryder System, Inc. is a leading provider of outsourced logistics and transportation services across North America, offering port-to-door solutions that integrate every step of the supply chain. This includes international inbound flows, cross-border logistics, fleet and transportation management, warehousing, manufacturing support, and multi-channel final delivery. The company's complementary business segments provide a broad range of value-added solutions designed to reduce complexity and improve speed, reliability, and efficiency across the entire flow of goods. Ryder System, Inc. generates revenue through three primary business segments: Fleet Management Solutions (FMS), which offers full service leasing, commercial rental, and vehicle maintenance services; Supply Chain Solutions (SCS), providing fully integrated logistics solutions; and Dedicated Transportation Solutions (DTS), delivering turnkey transportation solutions including dedicated vehicles, professional drivers, and management support.

Market Position: Ryder System, Inc. operates one of the leading full service leasing, commercial rental, and contract maintenance businesses in North America. In the U.S. commercial fleet market, approximately 1 million vehicles are leased or rented from third parties like Ryder System, Inc. out of an estimated 11 million total vehicles. The company's SCS segment operates in a U.S. logistics market with approximately $234 billion in outsourced spending out of a total of $1.5 trillion. The DTS segment addresses an outsourced U.S. dedicated market estimated at $31 billion, within an addressable market of approximately $500 billion. Ryder System, Inc. differentiates itself through its comprehensive port-to-door solutions, operational execution, leveraged assets and infrastructure, technical and industry expertise, and customer-facing visibility platforms.

Recent Strategic Developments: Ryder System, Inc. is executing a balanced growth strategy focused on de-risking and optimizing its business model, enhancing returns and free cash flow, and driving long-term profitable growth. Key priorities include creating value through operational excellence, investing in customer-centric innovation, and improving full-cycle returns. Strategic initiatives include leveraging secular trends favoring outsourcing, offering market-leading end-to-end solutions, growing contractual businesses, continuously improving productivity, and attracting and retaining talent. In 2024, Ryder System, Inc. acquired Cardinal Logistics for $302 million, a move expected to increase scale and network density in DTS. In 2023, it acquired IFS for approximately $254 million, expanding its contract packaging, manufacturing, and warehousing capabilities within the SCS segment. Effective March 31, 2026, Robert E. Sanchez will retire as CEO and assume the role of Executive Chair, with John J. Diez succeeding him as CEO.

Geographic Footprint: Ryder System, Inc.'s primary operational regions are North America, encompassing the United States, Canada, and Mexico.

• Fleet Management Solutions: Operates 789 locations across 49 states, the District of Columbia, Puerto Rico, and seven Canadian provinces. 20% of these locations are at customer sites.
• Supply Chain Solutions: Manages 722 customer accounts and 319 warehouses in the U.S., totaling 105 million square feet. In Mexico and Canada, it manages 170 customer accounts and 12 million square feet of warehousing, including 17 managed warehouses in Mexico. The company facilitates approximately 23,600 border crossings per month between the U.S. and Mexico, and 5,000 per month between the U.S. and Canada.
• Dedicated Transportation Solutions: Serves 210 customer accounts in the U.S.
• Long-lived assets: As of December 31, 2025, long-lived assets were $10.5 billion in the United States, $605 million in Canada, and $83 million in Mexico.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 20.2% (2025) vs. 19.6% (2024)
• Operating Margin: 5.4% (2025) vs. 5.2% (2024)
• Net Margin: 3.9% (2025) vs. 3.9% (2024)

Investment in Growth:

• Capital Expenditures: $2.06 billion (2025) vs. $2.69 billion (2024). Gross capital expenditures are expected to increase to approximately $2.4 billion in 2026, reflecting higher investments in the lease fleet.
• Strategic Investments: In 2024, Ryder System, Inc. acquired Cardinal Logistics for $302 million. In 2023, it acquired IFS for approximately $254 million.

Business Segment Analysis

Fleet Management Solutions (FMS)

Financial Performance:

• Revenue: $5.85 billion (-0.7% YoY)
• Operating Margin: 9.8% (2025) vs. 10.1% (2024)
• Key Growth Drivers: Higher ChoiceLease performance and benefits from maintenance cost savings initiatives, partially offset by lower used vehicle sales and weaker commercial rental demand. Used truck pricing decreased 15% and tractor pricing decreased 11% in 2025. Rental power fleet utilization remained consistent at 70%.

Product Portfolio:

• ChoiceLease: $3.51 billion revenue (60% of FMS total revenue), 141,700 vehicles. Provides bundled vehicle and maintenance services with no vehicle residual risk exposure for customers.
• Commercial Rental: $0.94 billion revenue (16% of FMS total revenue), 31,600 vehicles. Offers short-term vehicle supplements for seasonal increases or discrete projects.
• SelectCare: $0.68 billion revenue (12% of FMS total revenue), 44,100 customer vehicles. Provides access to an extensive network of maintenance facilities and technicians for customer-owned or third-party leased vehicles, including on-demand retail mobile maintenance via Torque by Ryder™.
• Fuel Services: $0.72 billion revenue (12% of FMS total revenue). Provides competitively priced diesel fuel at 401 facilities across the U.S. and Canada, along with fuel planning and tax reporting.
• Used Vehicles: Inventory of 9,500 vehicles as of December 31, 2025, slightly above the long-term target range of 7,000 to 9,000. Sales occur through 61 retail sales centers and a digital channel.

Market Dynamics: FMS operates in the U.S. commercial fleet market, estimated at 11 million vehicles, with 5 million privately owned. Trends favoring outsourcing include demand for efficient vehicles, increasing complexity and cost of maintenance, global supply chain and labor challenges, and rising vehicle ownership costs.

Supply Chain Solutions (SCS)

Financial Performance:

• Revenue: $5.46 billion (+3.0% YoY)
• Operating Margin: 8.7% (2025) vs. 8.4% (2024)
• Key Growth Drivers: Driven by new business, higher customer volumes, and improved performance from the optimization of the omnichannel retail network. Partially offset by lost business and extended customer plant shutdowns in the automotive sector during Q4 2025.

Product Portfolio:

• Distribution Management: Accounts for approximately 36% of SCS total revenue. Offers warehousing and transportation logistics services, including network design, warehouse automation, material flow coordination, international shipment management, and e-commerce fulfillment.
• Dedicated Transportation: Accounts for approximately 28% of SCS total revenue. Provides specialized dedicated transportation services using Ryder System, Inc. equipment and professional drivers or outside carriers.
• Transportation Management and Brokerage: Accounts for approximately 12% of SCS total revenue. Includes shipment optimization, load scheduling, and delivery confirmation through technology solutions. In 2025, Ryder System, Inc. purchased or executed $9.8 billion in freight moves on customers' behalf, including $334 million in brokerage services.
• E-commerce and Last Mile: Accounts for approximately 18% of SCS total revenue. Operates a network of over 165 sites for omnichannel delivery, including picking, packing, shipping smaller items, and final delivery/installation of big and bulky items, supported by RyderView 2.0™ software.
• Contract Manufacturing and Contract Packaging: Accounts for 6% of SCS total revenue. Services primarily for consumer packaged goods, retail, and healthcare industries.

Market Dynamics: SCS operates in a U.S. logistics market with $1.5 trillion in spending. Demand for outsourced logistics is increasing due to expanding and complex supply chains, requiring sophisticated, cost-effective, and reliable practices. Secular trends include supply chain resiliency, e-commerce fulfillment, final mile delivery, and onshoring/nearshoring.

• Omnichannel retail: $1.88 billion revenue.
• Automotive: $1.54 billion revenue.
• Consumer packaged goods: $1.21 billion revenue.
• Industrial and other: $0.83 billion revenue.

Dedicated Transportation Solutions (DTS)

Financial Performance:

• Revenue: $2.34 billion (-4.2% YoY)
• Operating Margin: 7.6% (2025) vs. 6.7% (2024)
• Key Growth Drivers: Increased 12% in 2025, reflecting acquisition synergies and the absence of prior year integration costs, partially offset by lower operating revenue due to a prolonged freight market downturn.

Product Portfolio:

• Provides specialized dedicated transportation services, including vehicles, professional drivers, and engineering services for routing, scheduling, fleet design, safety, regulatory compliance, risk management, and technology support.
• Offers custom transportation analysis using advanced logistics planning and operating tools to optimize freight flow and meet customer service goals.

Market Dynamics: The outsourced U.S. dedicated market is estimated at $31 billion from an addressable market of approximately $500 billion. Demand for outsourced dedicated services is expected to increase due to the growing complexity of operating and maintaining private fleets, increasing DOT regulations, and significant demand for qualified truck drivers and dedicated capacity. DTS serves 210 customer accounts in the U.S.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: $519 million in 2025, repurchasing 3.2 million shares.
• Dividend Payments: $145 million in 2025. The annualized dividend rate increased 12% to $3.64 per share of common stock in 2025.
• Future Capital Return Commitments: Ryder System, Inc. maintains two share repurchase programs approved in October 2025: an anti-dilutive program authorizing repurchase of up to 1.5 million shares, and a discretionary program authorizing repurchase of up to 2 million shares over two years.

Balance Sheet Position:

• Cash and Equivalents: $198 million as of December 31, 2025.
• Total Debt: $7.65 billion as of December 31, 2025.
• Net Cash Position: -$7.45 billion as of December 31, 2025.
• Credit Rating:
  • Standard & Poor’s Ratings Services: Short-term A2, Long-term BBB+, Outlook Stable.
  • Moody’s Investors Service: Short-term P2, Long-term Baa2, Outlook Positive.
  • Fitch Ratings: Short-term F2, Long-term BBB+, Outlook Stable.
• Debt Maturity Profile: Contractual maturities of total debt include $790 million in 2026, $1.39 billion in 2027, $1.56 billion in 2028, $1.47 billion in 2029, $1.77 billion in 2030, and $600 million thereafter.

Cash Flow Generation:

• Operating Cash Flow: $2.59 billion in 2025.
• Free Cash Flow: $946 million in 2025.
• Ryder System, Inc. expects net cash provided by operating activities from continuing operations to increase to approximately $2.7 billion in 2026, while free cash flow is expected to decrease to approximately $800 million, reflecting higher investments in the ChoiceLease fleet, partially offset by higher cash generated.

Operational Excellence

Production & Service Model: Ryder System, Inc.'s operational philosophy centers on delivering innovative, reliable, safe, and efficient supply chain and transportation solutions.

• FMS: Provides an extensive network of maintenance facilities and trained technicians, offering preventive and flexible maintenance programs. It leverages a digital fleet management platform, RyderGyde™, to optimize asset performance, compliance, and safety.
• SCS: Emphasizes operational execution, leveraging assets and infrastructure, technical and industry expertise, and customer-facing visibility platforms. Administrative support services are centralized in logistics centers in Novi, Michigan, and Fort Worth, Texas.
• DTS: Utilizes custom transportation analysis with advanced logistics planning and operating tools to optimize freight flow and meet customer service goals.

Supply Chain Architecture: Key Suppliers & Partners: Ryder System, Inc. purchases vehicles and related equipment from a relatively small number of Original Equipment Manufacturers (OEMs) in its FMS business. The company leverages these OEM relationships to secure access to vehicles.

Facility Network:

• Manufacturing: Not explicitly detailed as a manufacturing network for Ryder System, Inc.
• Research & Development: Not explicitly detailed as a dedicated R&D facility network.
• Distribution:
  • FMS: Manages 827 properties in the U.S., Puerto Rico, and Canada, owning 470 of these. These include maintenance facilities, fueling stations, sales and administrative offices, and commercial rental vehicle counters. 155 are on-site maintenance facilities at customer locations.
  • SCS: Manages 524 locations in the U.S., Canada, and Mexico, with 246 at customer locations. Most SCS locations are leased and include warehouses, administrative offices, and equipment domiciles. Mexico locations may also include repair shops. Ryder System, Inc. operates over 165 sites for e-commerce and last mile services.
  • Central Support Services: Maintains 14 U.S. locations, primarily administrative offices, owning four and leasing the remainder.

Operational Metrics:

• FMS: Rental power fleet utilization was 70% in 2025, consistent with the prior year. The average commercial rental power active fleet was 7% smaller in 2025 compared to the prior year. Used vehicle inventory stood at 9,500 vehicles as of December 31, 2025.
• SCS: As of December 31, 2025, SCS managed 319 warehouses in the U.S. (105 million sq ft) and 65 warehouses in Mexico and Canada (12 million sq ft, including 17 managed warehouses in Mexico).

Market Access & Customer Relationships

Go-to-Market Strategy:

• Direct Sales: Ryder System, Inc. drives fleet growth through sales and marketing initiatives aimed at encouraging private fleets to outsource their management needs. It also executes targeted sales and marketing growth strategies for SCS and leverages its FMS sales team to convert private fleet operators to DTS customers.
• Digital Platforms: The company utilizes digital platforms such as RyderGyde™ (mobile application and ryder.com®) for fleet management, RyderView 2.0™ for optimizing routes and scheduling appointments in e-commerce and last mile services, and ryder.com/used-trucks for used vehicle sales. Other proprietary technologies include RyderShare™ and RyderShip™.

Customer Portfolio:

• Enterprise Customers: FMS serves a diverse customer base ranging from small businesses to large enterprises. SCS primarily serves large enterprises with complex supply chains.
• Customer Concentration: In 2025, sales to the top ten customers in both the SCS and DTS segments each accounted for approximately one-third of their respective total revenue and operating revenue.
• Industry Diversification: Ryder System, Inc. serves a variety of industries, including omnichannel retail, automotive, consumer packaged goods (CPG), and industrial and other (including healthcare).

Geographic Revenue Distribution:

• United States: 93.0% of total revenue in 2025.
• Canada: 4.3% of total revenue in 2025.
• Mexico: 2.6% of total revenue in 2025.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The transportation industry is highly cyclical and sensitive to economic activity. The U.S. commercial fleet market, estimated at 11 million vehicles, faces trends such as increasing demand for efficient and reliable vehicles, growing complexity and expense of maintenance due to emissions regulations, global supply chain and labor challenges, and volatile used vehicle markets. The U.S. logistics market, with $1.5 trillion in spending, is seeing increased demand for outsourced solutions driven by supply chain expansion, e-commerce fulfillment, final mile delivery of big and bulky goods, and onshoring/nearshoring. The outsourced U.S. dedicated market, valued at $31 billion, is growing due to increasing Department of Transportation (DOT) regulations, demand for qualified truck drivers, and the need for dedicated capacity and industry expertise.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Fleet Management Solutions: Competes with finance lessors, truck and trailer manufacturers, independent dealers, and managed maintenance providers.
• Supply Chain Solutions: Competes with a few large, multi-service logistics companies across all product offerings, as well as specialized providers for specific services like transportation or distribution management.
• Dedicated Transportation Solutions: Competes with other dedicated providers offering highly engineered solutions and, to a lesser extent, with truckload carriers providing dedicated solutions for standard freight.

Emerging Competitive Threats: New entrants in the transportation and logistics market may offer similar services at lower cost or possess greater technological capabilities. Innovations in advanced vehicle technologies (e.g., zero-emission, autonomous), machine learning, artificial intelligence, and warehouse automation could significantly impact Ryder System, Inc.'s business model.

Competitive Response Strategy: Ryder System, Inc. aims to maintain its competitive advantage by offering market-leading end-to-end supply chain solutions, continuously improving productivity and processes, investing in customer-centric innovations, and expanding product offerings to complement its port-to-door solutions.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics: The business is highly cyclical and susceptible to adverse economic conditions, competition, and other factors that can decrease customer demand for transportation and logistics services. Weak or volatile economic conditions, including recessionary conditions, changes in international trade policy, labor shortages, tariffs, interest rate fluctuations, and inflationary pressures, can negatively impact demand, particularly for used vehicles, rental, and contractual sales. Technology Disruption: Rapid technological changes, such as zero-emission vehicles, autonomous or driver-assist technologies, and warehouse automation, pose risks of service obsolescence or require increased investment to remain competitive, which customers may not accept through higher prices. Customer Concentration: A limited number of customers account for a significant portion of revenue in the SCS and DTS segments, with the top ten customers in each segment representing approximately one-third of their respective total and operating revenues in 2025. The loss of or reduction in business from these large customers could materially impact financial results.

Operational & Execution Risks

Supply Chain Vulnerabilities: Disruptions in global supply chains, influenced by public health crises, geopolitical developments, labor strikes, and trade policy changes, directly impact the supply and demand of commercial vehicles and parts for FMS, and the production and supply of goods for SCS and DTS customers. Supplier Dependency: Ryder System, Inc. relies on a small number of Original Equipment Manufacturers (OEMs) for vehicles and related equipment, and some OEMs depend on a concentrated group of suppliers for specific parts, creating vulnerability to discrete events or adverse regional economic conditions. Capacity Constraints: The capital-intensive nature of the business requires significant investments in vehicles based on anticipated demand. Inaccurate projections can lead to overcapacity (requiring sales at lower prices, higher depreciation, or reduced profitability) or undercapacity (impacting service reliability and reputation).

Financial & Regulatory Risks

Market & Financial Risks: Ryder System, Inc. bears the risk of being unable to resell used vehicles at or above their estimated residual values, a market historically subject to significant pricing volatility. The company's ability to fund operations and contractual commitments relies heavily on U.S. credit and financial markets, making it vulnerable to volatility, constrained access to capital, or increased borrowing costs, especially if its investment-grade debt rating is downgraded. Volatility in pension plan assumptions, discount rates, and investment returns can adversely affect funding status and future funding requirements. Foreign Exchange: Exposure to foreign currency fluctuations, primarily the Canadian dollar and Mexican peso, exists due to foreign operations' buying, selling, and financing in non-local currencies. Credit & Liquidity: Access to capital could be constrained for extended periods if public investment-grade debt markets become limited or closed, or if access to revolving credit facilities is lost. Regulatory & Compliance Risks: Ryder System, Inc. operates in a highly regulated industry, subject to various agencies (e.g., DOT, USDA, HHS, DHS, DOL, OSHA, EPA). Non-compliance with regulations, including those related to emissions, vehicle specifications, drivers' hours of service, wage and hour requirements, data privacy, and cybersecurity, could lead to legal liability, fines, reputational harm, or loss of operating authority.

Geopolitical & External Risks

Geopolitical Exposure: Uncertainty or changes in U.S. or global social, political, or regulatory conditions, including those affecting international trade, can negatively impact business. Trade Relations: Changes in tariff policies, trade restrictions, and trade agreements (e.g., U.S.-Mexico-Canada Agreement) can increase maintenance costs or otherwise adversely affect operating results. Sanctions & Export Controls: Compliance with Office of Foreign Assets Control (OFAC) restrictions and other trade controls can limit business operations. Geographic Dependencies: Operations outside the U.S. expose Ryder System, Inc. to varying tax regimes, difficulties in managing foreign operations, and foreign currency fluctuations. Terrorism & Extreme Weather: Transportation assets are targets for terrorist activities, and extreme weather or natural occurrences can cause significant business interruptions and expenditures potentially exceeding insurance coverage.

Innovation & Technology Leadership

Research & Development Focus: Ryder System, Inc. is committed to investing in customer-centric innovation, actively deploying emerging technologies, and developing strategic alliances and new products. Core Technology Areas: The company focuses on advanced vehicle technologies (e.g., zero-emission vehicles, autonomous or driver-assist technologies), machine learning, artificial intelligence (including in warehouse automation), and proprietary software platforms such as RyderGyde™, RyderShare™, RyderView 2.0™, and RyderShip™.

Intellectual Property Portfolio:

• Patent Strategy: Not explicitly detailed.
• Licensing Programs: Not explicitly detailed.
• IP Litigation: Intellectual property infringement is identified as a litigation risk.

Technology Partnerships: Ryder System, Inc. engages in strategic alliances and collaborates with Original Equipment Manufacturers (OEMs) to ensure its technicians possess the necessary knowledge and skills to service customer vehicles, particularly with evolving vehicle technologies.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: Robert E. Sanchez, the current Chair and Chief Executive Officer, will retire as CEO and assume the role of Executive Chair effective March 31, 2026. John J. Diez will succeed him as CEO and be appointed to the Board at that time. Ryder System, Inc. emphasizes a robust talent and succession planning process to identify and develop future leaders for critical roles.

Human Capital Strategy

Workforce Composition:

• Total Employees: 51,600 employees in North America as of December 31, 2025.
• Geographic Distribution: Primarily North America.
• Skill Mix: Includes 12,700 professional drivers and 4,600 technicians. Of the 34,300 hourly employees in the U.S., 3,600 are organized by labor unions.

Talent Management: Acquisition & Retention: Ryder System, Inc. prioritizes attracting, developing, and retaining talent through a robust talent and succession planning process. The company provides a variety of resources for skill development, including online resources, individual development opportunities, and leadership development programs. Challenges include significant competition for qualified professional drivers, a decrease in the supply of skilled maintenance technicians, and ongoing competition for warehouse associates, which can lead to higher labor costs and turnover. Diversity & Development: The company strives to create a high-performance culture that embraces diverse perspectives and experiences, ensuring employees have opportunities to grow. It invests in employees through comprehensive health, welfare, and retirement programs, along with wellness initiatives. Professional drivers, technicians, and warehouse associates receive ongoing training, including certified driver trainers, OEM collaboration for technicians, and regular safety and compliance training for warehouse staff. Culture & Engagement: Ryder System, Inc. is committed to fostering a positive and collaborative work environment, with safety embedded in day-to-day operations, reinforced by numerous safety programs, continuous operational improvement, and a dedicated safety organization.

Labor Relations: Approximately 3,600 U.S. employees are unionized, primarily represented by the International Brotherhood of Teamsters, the International Association of Machinists and Aerospace Workers, and the United Auto Workers. Their wages and benefits are governed by 94 separate labor agreements, which are periodically renegotiated. While no material work stoppages have occurred, such events are a potential risk.

Environmental & Social Impact

Environmental Commitments: Climate Strategy: Ryder System, Inc.'s operations involve storing and dispensing petroleum products, subjecting it to environmental protection laws. The company continually upgrades facilities and implements programs to detect and minimize contamination. It faces risks from new or more restrictive laws and regulations related to emissions or vehicle specifications, including emission reduction and zero-emission vehicle requirements. The adoption of zero-emission vehicles by customers could reduce demand for diesel vehicle and related maintenance offerings.

Social Impact Initiatives:

• Product Impact: Ryder System, Inc. offers safety support to customers through Ryder Fleet Risk Services (FRS), providing customized consultations, training, and compliance support to navigate complex industry landscapes.

Business Cyclicality & Seasonality

Demand Patterns:

• Seasonal Trends: Lease and related maintenance revenues, as well as Dedicated Transportation Solutions (DTS) service revenues and most Supply Chain Solutions (SCS) service revenues, are generally not impacted by seasonality due to the long-term nature of underlying customer contracts. However, commercial rental revenue is seasonal, typically lowest in the first quarter and highest in the third and fourth quarters. Some SCS customers operate in seasonal industries, leading to periodic reductions in freight volume or service needs.
• Economic Sensitivity: Ryder System, Inc.'s business is impacted by economic and market conditions. Demand for services generally increases in a strong economy and decreases in a weak or volatile economy. Commercial rental and used vehicle sales businesses are transactional and more susceptible to economic and market conditions.
• Industry Cycles: The transportation industry is highly cyclical.

Planning & Forecasting: Ryder System, Inc. mitigates volatility through a disciplined and centralized approach to asset management, striving to manage the size, mix, and location of its operating fleet and used vehicle inventories to maximize asset utilization and used vehicle proceeds across various market conditions. The company adjusts the size of its rental fleet and moves vehicles among locations to mitigate seasonal demand effects.

Regulatory Environment & Compliance

Regulatory Framework: Ryder System, Inc. operates in a highly regulated industry, subject to laws and regulations in all jurisdictions where it operates. Industry-Specific Regulations: Key regulatory bodies include the U.S. Department of Transportation (DOT), Department of Agriculture (USDA), Department of Health and Human Services (HHS), Department of Homeland Security (DHS), Department of Labor (DOL), Occupational Safety and Health Administration (OSHA), and Environmental Protection Agency (EPA). The Federal Motor Carrier Safety Administration (FMCSA) manages the Compliance, Safety, Accountability (CSA) program and mandates electronic logging devices. The company must comply with licensing and other requirements imposed by the DHS. International Compliance: Ryder System, Inc.'s supply chain security program is certified by the U.S. Customs and Border Protection Customs-Trade Partnership Against Terrorism certification, Canada’s Partners in Protection program, and Mexico’s Authorized Economic Operator program. Trade & Export Controls: The company is subject to changes in tariff policies, trade restrictions, and trade agreements (e.g., U.S.-Mexico-Canada Agreement), as well as Office of Foreign Assets Control (OFAC) restrictions. Legal Proceedings: Ryder System, Inc. is involved in various claims, lawsuits, and administrative actions in the ordinary course of business, including commercial and employment claims, environmental matters, and risk management matters (e.g., vehicle liability, workers’ compensation). While some involve substantial amounts, management believes their aggregate disposition will not have a material impact on consolidated financial condition or liquidity.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: The effective tax rate from continuing operations was 26.8% in 2025, compared to 26.0% in 2024. The comparable tax rate was 26.0% in 2025, compared to 25.7% in 2024.
• Geographic Tax Planning: In 2025, Ryder System, Inc. repatriated $40 million of current year earnings from its Canada subsidiaries with minimal tax cost. In 2024, $14 million of current year earnings were repatriated from its Mexico subsidiary with minimal tax cost. The company considers undistributed earnings of its Mexico subsidiary generated through 2023 and Canada subsidiary generated through 2024 to be indefinitely reinvested.
• Tax Reform Impact: The "One Big Beautiful Bill Act" (OBBBA), signed into law on July 4, 2025, permanently reinstated 100% tax bonus depreciation, restored earnings before interest, taxes, depreciation and amortization as the basis for calculating the business interest expense limitation, and restored immediate expensing for domestic research and experimental expenditures, among other changes. These changes reduced Ryder System, Inc.'s annual U.S. federal cash tax liability by approximately $200 million in 2025 and had no material impact on its effective income tax rate.

Insurance & Risk Transfer

Risk Management Framework: Ryder System, Inc. retains a portion of accident risk under its vehicle liability, workers’ compensation, and other insurance programs.

• Insurance Coverage: The company is substantially self-insured for vehicle liability and workers’ compensation claims. Through September 30, 2025, it retained a risk of loss up to $3 million per occurrence. Effective October 1, 2025, this risk of loss for vehicle liability increased to $10 million per occurrence. Ryder System, Inc. maintains various insurance structures with aggregate limits and excess insurance policies to limit exposure above self-insured retentions.
• Risk Transfer Mechanisms: The company uses interest rate swap agreements to manage its fixed-rate and variable-rate debt exposure and to better match the repricing of debt instruments to its asset portfolio. It also uses foreign currency option contracts and forward agreements to hedge foreign currency transactional exposure.