U.S. Xpress has seen its second significant departure of an executive in the last eight months.
In a filing with the Securities and Exchange Commission, U.S. Xpress (NYSE: USX) said it and chief commercial officer Jake Lawson had “mutually decided to part ways.”
The move follows the December departure of Variant president Cameron Ramsdell. However, Ramsdell was “terminated,” according to the wording of the form 8-K SEC filing that U.S. Xpress submitted in December. The filing for Lawson did not use that term, rather portraying his departure as by mutual agreement.
“Jake has been instrumental in maturing our sales, customer experience and revenue management teams during his tenure at U.S. Xpress,” CEO Eric Fuller said in the SEC filing. “Jake’s input has been critical in designing the future structure of our commercial organization, and he will be essential in ensuring we have a seamless transition in the weeks ahead.”
Lawson did not possess a trucking company background when he joined U.S. Xpress in February 2021. He had served in key roles in sales and product development at Whirlpool and then joined Lowe’s in a key sales and marketing division role.
U.S. Xpress has struggled of late. While other companies were posting significantly better performance during the strong trucking market in the four quarters between the second half of 2021 and first half of 2022, U.S. Xpress saw little benefit from that. Its adjusted operating ratio from Q3 2021 through Q4 2022 came in at 98.5%, 100.2%, 99.2% and 99.5%, respectively.
Variant is the “startup within a company” seeking to capitalize on technology to create a significantly different business model than traditional truckload operations. However, several metrics at Variant are lagging well below projections — in particular driver turnover, which had been projected as a key area of improvement under the Variant plan. But turnover was 150% in the second quarter.
The U.S. Xpress stock price Wednesday at about 2:15 p.m. EDT was $2.86. That is down about 70% from its 52-week high of $9.40 on Oct. 21 but 32% more than its 52-week low of $2.13 set June 23.
On the company’s latest earnings call, no analysts registered as participants (according to a transcript from SeekingAlpha), suggesting the trucking analyst community is skeptical of the Variant plan. While analyst participation in previous U.S. Xpress calls was always less than the turnouts for other major truckload and less-than-truckload carriers, there always had been a few interested in the Variant initiative as well as the company’s overall performance..
U.S. Xpress remains a significant force in the truckload sector. In the second quarter, its revenue of $553.7 million came in well above that of Heartland Express (NASDAQ: HTLD), which saw revenue of $187.8 million, and Marten (NASDAQ: MRTN), with revenue of $329.5 million. Marten has recorded several 52-week stock price highs in recent weeks.
U.S. Xpress is smaller than Werner (NASDAQ: WERN), which recorded second-quarter revenue of $836.3 million.
Disclosure: FreightWaves founder and CEO Craig Fuller retains ownership of U.S. Xpress shares through his family trust.
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