Forward Air shares surged 18.6% to a two-month high after the company entered into a non-binding memorandum of understanding with one of its largest customers to retain at least 50% of the business that had been at risk of shifting to other providers, with the potential to retain up to 75%. The customer generated approximately $250 million of Forward Air's fiscal 2025 revenue, and the agreement extends the contract for retained services by at least another two years, with any remaining transition expected to begin later in 2026 and mostly occur in December and throughout 2027. The deal could preserve $125 million to $187 million of annual revenue that investors had feared was largely at risk, improving earnings visibility, network utilization, cash flow outlook, and the ability to reduce leverage following the debt-heavy Omni Logistics acquisition.
Forward Air CorporationRetains up to 75% of at-risk business from a major customer, preserving $125M-$187M annual revenue.