01—Abstract
Summary
Summary of the 10-K filed February 18, 2026. Cited figures are marked; the original filing is the authoritative source.
PACCAR Inc (PCAR) reported a significant decrease in net sales and revenues for 2025, falling to $28.44 billiona from $33.66 billion in 2024.
This decline was primarily driven by lower truck deliveries across all major markets, reflecting a general slowdown in retail demand. Despite the revenue decrease, the company maintained profitability, reporting net income of $2.38 billionb ($4.51 per diluted share). The company also incurred a substantial $350.0 million pre-tax charge related to civil litigation in Europe, which impacted net income and adjusted metrics.
PACCAR continues to invest in future technologies, including alternative powertrains and autonomous driving systems, with capital investments and R&D expenses remaining significant. The Parts segment demonstrated resilience, with sales increasing by 3% to $6.87 billionc, supported by higher sales in North America and Europe. The Financial Services segment also saw revenue growth, up 5% to $2.21 billion, driven by portfolio growth and higher yields.
However, credit quality within the Financial Services segment showed signs of strain, with a notable increase in past-due accounts in Brazil, Mexico, and the U.S., leading to a higher provision for losses on receivables. The company's outlook for 2026 anticipates a stabilization in heavy-duty truck sales in North America and Europe, with modest growth expected in the Parts segment. Investors should monitor the impact of ongoing trade policies and evolving emissions regulations on future performance.
02—Key points
Key Highlights
- PACCAR reported a 15.5% year-over-year decrease in net sales and revenues, totaling $28.44 billion for 2025, primarily due to lower truck deliveries.
- Net income for 2025 was $2.38 billion, or $4.51 per diluted share, though this included a significant $350 million pre-tax charge related to European civil litigation.
- The Parts segment saw a 3% increase in sales to $6.87 billion, indicating strength in aftermarket demand.
- Financial Services revenue grew 5% to $2.21 billion, driven by portfolio growth and higher yields, though past-due accounts increased.
- Truck segment gross margin declined significantly to 7.5% from 13.9% in the prior year, impacted by lower volume, reduced price realization, and higher costs, including tariffs.
- PACCAR continues its strategic investment in new technologies, with capital expenditures of $728.5 million and R&D expenses of $445.5 million in 2025.
- The company expects industry heavy-duty truck sales in the U.S. and Canada to be between 230,000 to 270,000 units in 2026, compared to 232,800 in 2025.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2025filed February 18, 2026Financial Statements
FY2025 against FY2024
| Line item | FY2025FY2024 | Change |
|---|---|---|
| Revenue | $28.44B$33.66B | −15.5% |
| Cost of Revenue | $22.74B$26.07B | −12.8% |
| Gross Profit | $5.71B$7.59B | −24.8% |
| R&D Expenses | $445.50M$452.90M | −1.6% |
| SG&A Expenses | $735.80M$744.00M | −1.1% |
| Net Income | $2.38B$4.16B | −42.9% |
| EPS (Basic) | $4.52$7.92 | −42.9% |
| EPS (Diluted) | $4.51$7.90 | −42.9% |
| Shares Outstanding (Basic) | 525.90M525.30M | +0.1% |
| Shares Outstanding (Diluted) | 526.80M526.60M | 0.0% |
05—Questions
Frequently Asked Questions
What was the primary driver of PACCAR's revenue decline in 2025?
The primary driver of PACCAR's revenue decline in 2025 was a significant decrease in truck deliveries across all major markets, a trend attributed to lower retail demand and the impact of import tariffs. Truck segment revenues decreased by 22% year-over-year.
How did the European civil litigation impact PACCAR's financial results?
PACCAR incurred a substantial $350.0 million pre-tax charge ($264.5 million after-tax) in the first quarter of 2025 related to ongoing European civil litigation (EC-related claims). This charge negatively impacted net income and various profitability metrics, although the company has settled with a majority of claimants.
What is the outlook for PACCAR's key segments in 2026?
PACCAR anticipates heavy-duty truck industry sales in the U.S. and Canada to range between 230,000 to 270,000 units in 2026, similar to 2025 levels. The Parts segment is projected to see a 4-8% sales increase, while the Financial Services segment expects average earning assets to remain comparable to 2025 levels, with the used truck market showing improvement.
Are there any concerns regarding the Financial Services segment's credit quality?
Yes, the Financial Services segment experienced an increase in past-due accounts, particularly in Brazil, the U.S., and Mexico, due to weaker market conditions and higher interest rates in some regions. This led to a higher provision for losses on receivables and increased net charge-offs compared to the previous year.
06—Continue