Knight-Swift Transportation Holdings Inc.KNX
Knight-Swift Transportation Holdings Inc. Leases Disclosure
Leases
Lessee Disclosures
Lease Cost — The components of the Company's lease cost were as follows:
| 2025 | 2024 | ||||||||||
| (in thousands) | |||||||||||
| Operating lease cost: | |||||||||||
| Operating lease costs | $ | 144,269 | $ | 160,891 | |||||||
Short-term lease cost 1 | 22,564 | 10,774 | |||||||||
| Rental expense | 166,833 | 171,665 | |||||||||
| Finance lease cost: | |||||||||||
| Amortization of property and equipment | 147,479 | 134,597 | |||||||||
| Interest expense | 26,646 | 23,286 | |||||||||
| Total finance lease cost | 174,125 | 157,883 | |||||||||
| Total operating and finance lease costs | $ | 340,958 | $ | 329,548 | |||||||
1 Short-term lease cost includes leases with a term of twelve months or less, as well as month-to-month leases and variable lease costs.
Lease Liability Calculation Assumptions — The assumptions underlying the calculation of the Company's right-of-use assets and corresponding lease liabilities are disclosed below.
| December 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Operating | Finance | Operating | Finance | ||||||||||||||||||||
| Revenue equipment leases | |||||||||||||||||||||||
| Weighted average remaining lease term | 2.3 years | 3.3 years | 3.6 years | 3.6 years | |||||||||||||||||||
| Weighted average discount rate | 3.6 | % | 4.7 | % | 5.0 | % | 4.4 | % | |||||||||||||||
| Real estate and other leases | |||||||||||||||||||||||
| Weighted average remaining lease term | 6.1 years | 7.3 years | 8.3 years | 8.3 years | |||||||||||||||||||
| Weighted average discount rate | 4.2 | % | 4.2 | % | 4.4 | % | 4.2 | % | |||||||||||||||
Maturity Analysis of Lease Liabilities (as Lessee) — Future minimum lease payments for all noncancellable leases were:
| December 31, 2025 | |||||||||||
| Operating | Finance | ||||||||||
| (In thousands) | |||||||||||
| 2026 | $ | 140,038 | $ | 130,366 | |||||||
| 2027 | 71,801 | 162,015 | |||||||||
| 2028 | 52,209 | 158,635 | |||||||||
| 2029 | 28,333 | 147,764 | |||||||||
| 2030 | 21,797 | 61,901 | |||||||||
| Thereafter | 80,748 | 18,489 | |||||||||
| Future minimum lease payments | 394,926 | 679,170 | |||||||||
| Less: amounts representing interest | (59,600) | (72,944) | |||||||||
| Present value of minimum lease payments | 335,326 | 606,226 | |||||||||
| Less: current portion | (127,538) | ||||||||||
| Lease liabilities – less current portion | $ | 207,788 | $ | 502,042 | |||||||
Supplemental Cash Flow Lease Disclosures — The following table sets forth cash paid for amounts included in the measurement of lease liabilities:
| 2025 | 2024 | ||||||||||
| (in thousands) | |||||||||||
| Operating cash flows for operating leases | $ | 161,610 | $ | 175,898 | |||||||
| Operating cash flows for finance leases | 26,646 | 23,286 | |||||||||
| Financing cash flows for finance leases | 147,477 | 134,838 | |||||||||
Refer to Note 22 for information regarding the leasing transactions between the Company and its related parties.
Lessor Disclosures
The Company leases revenue equipment to independent contractors and other third parties under operating leases, which generally have terms between three and four years, and include renewal and purchase options. These leases also include variable charges associated with miles driven in excess of the stipulated allowable miles in the contract, which are accounted for separately and presented in the table below. Lease classification is determined based on minimum rental receipts per the agreement, including residual value guarantees, when applicable, as well as receivables due to the Company upon default or cross-default. When independent contractors default on their leases, the Company typically re-leases the equipment to other independent contractors. As such, future lease receipts reflect original leases and re-leases.
The Company's leases to third parties, some of which are subleases, are generally short-term, and may include renewal options.
The owned assets underlying the Company's leases as lessor primarily consist of revenue equipment. As of December 31, 2025 and 2024, the gross carrying value of such revenue equipment underlying these leases was $37.7 million and $51.9 million, respectively, and accumulated depreciation was $21.1 million and $26.5 million, respectively. Depreciation is calculated on a straight-line basis down to the residual value, as applicable, over the estimated useful life of the equipment. Depreciation expense for these assets was $7.9 million and $12.7 million for 2025 and 2024, respectively.
Additionally, the Company periodically leases or subleases out real estate for use by third parties. These leases have varying terms, and may include renewal options.
Management’s significant assumptions and judgments include the determination of the amount the Company expects to derive from the underlying asset at the end of the lease term, as well as whether a contract contains a lease.
Lease Revenue and Rental Income — The components of the Company's lease revenue are included in "Revenue, excluding truckload and LTL fuel surcharge" and the Company's rental income is included in "Other income, net" in the consolidated statements of comprehensive income. These amounts are disclosed in the table below.
| 2025 | 2024 | ||||||||||
| (in thousands) | |||||||||||
| Operating lease revenue | $ | 76,820 | $ | 55,154 | |||||||
| Variable lease revenue | 1,020 | 911 | |||||||||
Total lease revenue 1 | $ | $ | |||||||||
Rental income 2 | $ | 15,588 | $ | 15,379 | |||||||
1 Represents operating revenue earned by the Company for leasing equipment to independent contractors and other third-parties.
2 Represents non-operating income earned from leasing real estate to third parties.
Maturity Analysis of Future Lease Revenues (as Lessor) — Future minimum lease revenues for all noncancellable leases were:
| December 31, 2025 | |||||
| (In thousands) | |||||
| 2026 | $ | 54,126 | |||
| 2027 | 41,256 | ||||
| 2028 | 27,264 | ||||
| 2029 | 15,443 | ||||
| 2030 | 11,326 | ||||
| Thereafter | 7,793 | ||||
| Future minimum lease revenues | $ | 157,208 | |||
Refer to Note 22 for information regarding the leasing transactions between the Company and related parties.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 27, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Feb 17, 2017 | |
| 2015 | Feb 22, 2016 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.