Ryder System anticipates concluding 2024 as a company that, over six years, has steadily and inexorably transformed itself from what it was and is still largely known for – truck rentals – into a transportation offering where contractual business forms the increasing base of its operations. This shift has been a consistent message from Ryder (NYSE: R) management in various presentations for several years. However, it was further emphasized in its third-quarter earnings report and subsequent analyst call, highlighted by a chart comparing Ryder in 2018 with Ryder today.

In a graphic that depicted Ryder six years ago as 'pre-transformation,' 56% of the company's $8.4 billion in revenue originated from its Fleet Management Services (FMS) division, the unit whose ubiquitous trucks on the road serve as rolling advertisements for its truck rental activities. The remaining 44% came from the combined operations of Supply Chain Solutions (SCS), primarily a contract logistics provider, and the Dedicated Transport Solutions (DTS) segment, which offers dedicated transportation for contract clients.

After several years, this revenue split is projected to be approximately 60% from SCS/DTS and the remaining balance from FMS by the end of this year. The advantage, as explained by Ryder CEO Robert Sanchez during the conference call, is that the SCS/DTS business is more contractually driven, resulting in more predictable revenue streams and earnings.