The Supreme Court’s Montgomery ruling is sending more small brokerages and owner-operators toward Landstar’s independent agent network, according to company executives.
During the company’s third-quarter 2026 earnings conference call, Landstar (CCJ Top 250, No. 11) Chief Executive Officer Frank Lonegro, pointed out that the Montgomery decision is a net positive for the company’s agent model.
“We’re seeing lots of really good conversations where folks are really looking for a safe haven,” he said.
Plaintiffs previously faced significant hurdles suing freight brokers in jurisdictions where federal preemption protections applied. Following the U.S. Supreme Court’s ruling, that legal shield has weakened, leaving smaller brokerages more exposed to carrier-selection lawsuits, rising defense costs and higher insurance claims – risks that Landstar’s agent model is design to absorb.
The full industry impact is expected to take one to two years, Lonegro said, as insurance policies come up for renewal.
Landstar has already signed Show Me Global Logistics as an independent agent, a Midwest brokerage of about $20 million, with more signings to close.
New-agent revenue hit an all-time high of roughly $180 million in one past year but has run $30 million to $50 million annually during the 2023-2025 freight recession, Chief Financial Officer James Todd noted.
“If we can just torque back [to that] kind of strong years, there’s probably $100 million tailwind,” he said.
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Stricter carrier vetting standards
Aside from efforts to boost its agent network, Landstar has continued tightening its third-party carrier base, initially in response to freight fraud.
Chief Safety and Operations Officer Matt Miller said the approved carrier count was roughly 100,000 in the second quarter of 2022 and 64,000 in the second quarter of 2026. It ticked up by roughly 3,300 carriers, or 5%, in third quarter, to 67,915 at quarter-end, including 39,460 approved and active carriers, compared with 40,004 a year ago.
Miller said the increase reflects carriers that have accepted stricter compliance steps, not a flood of new entrants. Lonegro said Landstar doesn’t take “newly minted” MC numbers as owner-operators, and carriers are rerun through its vetting system every 24 hours.
Claims costs weigh on quarterly results
The company reported overall revenue of $1.512 billion, up 24.5% from $1.205 billion a year earlier, which Lonegro attributed to market conditions that have shifted from favoring shippers to favoring transportation providers, after nearly four years.
Despite stronger freight market conditions and higher revenue, insurance and claim costs weighed heavily on Landstar’s quarterly performance.
Insurance and claims costs of $55.3 million included about $13.0 million, of $0.29 per share, of adverse actuarial adjustments to reserves, plus $8.0 million of prior-year developments from settlements of a 2024 brokered truck accident claim and a 2025 Business Capacity Owner (BCO) accident. Net unfavorable adjustments to prior-year claim estimates $21.9 million.
Lonegro attributed it to the litigation environment, “It’s no secret—the truck transportation industry has been under attack of late by an incredibly aggressive plaintiff bar, emboldened by the prospect of nuclear verdicts and the Montgomery decision.”
Looking ahead, the company offered fourth-quarter commentary rather than formal guidance, citing uncertainty around freight market conditions, geopolitics and litigation. Historically, Lonegro said the seasonal shift from the third to fourth quarter brings about 1% sequential increases in revenue per load and load volume, alongside 20 to 30 basis points of compression in variable contribution margin.
October is tracking ahead of normal seasonality. Loads hauled by truck were about 7% above October 2025, while revenue per load was about 29% higher.
Lonegro said the upcycle still have “a good way to run.” The market has been supply-driven for most of the year, he noted, but low-to-mid single-digit volume growth could shift the narrative toward demand.
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Financial highlights
- Pricing and volume: Truck revenue was up $1.407 billion, up 29%, with revenue per load up 25% and loads up 3%.
- Sequential surges: Truck revenue per load rose 7.5% sequentially—the second largest second-to-third quarter increase in 15 years, behind only the 2020 rebound from the COVID-19 downturn.
- Heavy haul strength: Generated approximately $185 million, up 25% year over year, driven by data centers, aerospace, defense, and electrical
Capacity: Landstar added a net 165 BCO trucks, its strongest quarterly gain since the third quarter of 2021.
