Forward Air has reached an agreement with one of its largest customers that will allow the company to retain a significant share of a major account previously at risk of being lost.
The non-binding memorandum of understanding ensures the current contract will remain in place for at least the next two years. Under the agreement, Forward Air will retain at least 50% of the customer’s business, with the possibility of increasing that share to 75%.
The portion of the business that will not remain with Forward Air is expected to transition to other providers beginning in December and continuing throughout next year.
The customer had informed the company in May that it intended to diversify its network of logistics providers, raising the possibility of withdrawing the entire account, valued at approximately $250 million annually. At the time, Forward Air emphasized that the decision was not linked to service quality, describing its performance for the customer as exceptional.
Despite those assurances, the announcement had a significant impact on investor confidence. Forward Air’s shares fell by more than 40% after the company warned that it could lose a customer responsible for roughly 10% of its annual revenue.
The potential loss also disrupted the company’s broader strategic plans. Forward Air had launched a strategic review at the beginning of 2025 as investor pressure increased following its contested acquisition of Omni Logistics. Company executives previously acknowledged that uncertainty surrounding the customer relationship complicated efforts to pursue a potential sale of the business.
Instead, the company is moving forward with plans to divest its intermodal division along with two smaller legacy Omni businesses. Together, those operations generated $394 million in revenue last year.
Forward Air intends to use the proceeds from the planned asset sales to strengthen its balance sheet by reducing debt. At the end of the first quarter, the company reported $1.65 billion in net debt, equivalent to 5.4 times its adjusted EBITDA over the previous twelve months.
President and CEO Shawn Stewart said the discussions with the customer had been highly constructive and described the agreement as an important milestone. He noted that the possibility of retaining up to 75% of the business while extending the partnership reflects the strength of a relationship that has lasted more than two decades and demonstrates the quality of service delivered by Forward Air’s teams.
Investors reacted positively to the announcement, with Forward Air shares rising 19% in early Tuesday trading, significantly outperforming the S&P 500, which gained 0.5% over the same period.
The agreement marks an important step for Forward Air as it works to stabilize its customer base, reshape its business portfolio and improve its financial position. It also provides a look at the leverage large customers possess with logistics providers, and the importance of long-term partnerships, customer diversification and operational reliability in the freight industry.
