FORWARD AIR CORP

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition and/or operating results. The risks discussed in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Other than the following risk factors, which update and replace in their entirety the risk factors titled “We cannot assure you that our evaluation of strategic alternatives will result in any particular outcome, and the perceived uncertainties related to the Company could adversely affect our business and our stockholders,” “We derive a significant portion of our revenue from a few major customers, the loss of one or more of which could have a material adverse effect on our business” and “We experience customer concentration which could adversely impact our financial condition and results of operations,” there have been no material changes to the risk factors identified in Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2025.

Market, customer and vendor perception regarding the conclusion of the strategic review process and uncertainty regarding the Board’s pursuit of other strategic initiatives could adversely affect our business and cause the price of our shares to fluctuate significantly.

In January 2025, the Board initiated a comprehensive review of strategic alternatives to maximize shareholder value, exploring a range of options relative to the long-term value potential of the Company on a standalone basis. The process included extensive negotiations and discussions with multiple parties. However, due to a variety of factors no actionable proposals for a sale of the Company were ultimately received. The Board continues to be open to, and intends to consider, all opportunities to enhance shareholder value, and has determined to pursue a potential sale of non-core assets, including our Intermodal segment and two of our smaller legacy Omni businesses.

Although the Board intends to pursue other strategic initiatives, including the disposition of non-core assets, there can be no assurance that we will be successful in implementing or executing on any such initiatives or that any such initiatives will be successful or drive the expected, or any, value creation. In addition, market, customer and vendor perception regarding the conclusion of the strategic review process and uncertainty regarding the Board’s consideration, and any impact, of other opportunities could materially adversely affect our business, financial condition and/or operating results and cause the price of our shares to fluctuate significantly.

We experience customer concentration which could adversely impact our financial condition and results of operations.

Our top ten customers, based on revenue, accounted for approximately 26% of our revenue for the year ended December 31, 2025, with one customer (the “Customer”) accounting for slightly less than 10% of consolidated operating revenues for year ended December 31, 2025, and approximately 12% of consolidated operating revenues for the three months ended March 31, 2026. These customers can impact our revenues and profitability based on factors such as: (i) industry trends related to e-commerce that may apply downward pricing pressures on the rates our customers can charge; (ii) seasonality; (iii) business combinations and the overall growth of a customer’s underlying business; and (iv) any disruptions to our customers’ businesses.

If these customers choose to divert all or a portion of their business with us to one of our competitors, demand pricing concessions for our services, require us to provide enhanced services that increase our costs, or develop their own shipping and distribution capabilities it may have a material adverse effect on our business and operating results.

While no formal notices of termination have been delivered, we are currently in active discussions with the Customer regarding the transition of a significant portion of the Customer’s contract logistics business with us to other suppliers for reasons related to the Customer’s operations and supplier diversification initiatives.

While there can be no assurances as to the portion of the business that will be transitioned, transition timing or transition plan, the Company’s existing agreements with the Customer contemplate a transition period in some cases of up to 24 months. Forward Air expects an orderly transition and is in the process of negotiating the scope of the transition, as well as disentanglement fees in respect of transition-related costs. Given the revenue and profitability relating to the services provided to the Customer, if the Customer transitions all or a significant portion of the business to other suppliers, our business, financial condition and/or operating results will be materially adversely affected.