Saia eyes additional capex, market upcycle as path to 80 OR

Saia sees its investment in additional terminals over the past couple of years as a key factor in succeeding in its intentions. (Saia)

Saia is targeting an operating ratio of less than 80 and believes additional investments and the ongoing freight market recovery will enable the carrier to meet that goal, CEO Fritz Holzgrefe said July 30.

Less-than-truckload carrier Saia is already making progress toward the objective and sees its investment in additional terminals over the past couple of years as the key factor in succeeding in its intentions, the company’s top executive and Chief Financial Officer Matt Batteh told analysts.

“We can operate this business below 80 OR, no question. [OR] should start with a seven. This pace at which we get there … the economic backdrop is going to have an influence in that,” Holzgrefe said during Saia’s second-quarter 2026 earnings call. “[With] the stronger economic backdrop, the opportunity for us to accelerate that OR improvement year over year is absolutely there.”

A carrier’s OR provides insight on how well a company is balancing its costs and revenue generation. The lower the ratio, the better a company’s performance. An OR of 80 is considered exceptional with most LTL carriers running an OR of between 85 and 90.

Saia reported an OR of 86.9 in the second quarter of 2026, compared with 87.8 in the same period 12 months earlier. Saia posted a 4.8 OR improvement sequentially compared with the first quarter of 2026 too, outpacing the typical 2.5-3.0 improvement.

Scale and density are vital in the LTL arena, so an expansive terminal network is crucial. Johns Creek, Ga.-based Saia currently has 218 terminals after a heavy investment program and is considering further capital expenditure to meet its ambitions.

“We’re in a position right now where we’re generating strong cash flow to the extent that we might supplement our network and make additional investments. We’re going to be able to do that from operating cash flow. That’s a really big deal,” said Holzgrefe. “And that’s an opportunity for us to really drive not only our OR, but drive the operating returns for the company just in total.

Saia ranks No. 18 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 6 among LTL carriers.

The company spent about $1 billion on new real estate since 2022, adding 33 terminals to its operations and relocating or expanding 25 others, said Holzgrefe.

Saia was the winning bidder for 17 facilities in the first auction of Yellow Corp. terminals in 2023 for a combined $235.7 million. The terminals include facilities in Fresno, Calif.; Bowling Green, Ky.; West Boston, Mass.; Grand Rapids, Mich.; Trenton, N.J.; Rochester, N.Y.; Akron, Ohio; and Laredo, Texas.

The carrier also won the most properties on offer in the second auction, agreeing to pay a combined $7.92 million for 11 properties across seven Western states. At the time Yellow sought court protection from its creditors, the company ranked No. 13 on the for-hire TT100 and No. 3 on the LTL list. It owned 169 terminals at the time and leased 142.

Saia’s latest additions to its property portfolio will also share in the improvement in OR, said the company’s top executive. Facilities that opened in 2023 and 2024 saw a 300 basis-point year-over-year improvement in their OR in Q2.

“They’re operating in the low 90s. That’s great progress. We’re pleased with that, but they’ve got room to go. And one of the things that we track very closely is that some of these get up to speed a lot faster. Some take a little bit more time,” said Holzgrefe.

Saia’s ongoing progress on OR, including through increased sales, was evident in the most recent quarter’s results, which also benefited from the ongoing freight market upturn.

Revenue totaled $956.5 million in Q2, a 17.1% increase from $817.1 million in the year-ago period. Holzgrefe said it was the highest revenue total in the company’s history. Saia was founded in 1924.

The company’s revenue per LTL shipment, excluding fuel surcharge revenue, increased 1.5% to $303.12 from $298.71 while its LTL shipments per workday increased 4.4% to 2,361 from 2,261.

Saia posted a Q2 profit of $94.3 million, an increase of 32.1% compared with $71.4 million in the year-ago period.