Paccar Inc.

Strong Q1 Performance but Margin Pressure: PACCAR reported Q1 revenues of $7.4 billion and adjusted net income of $770 million, despite facing margin pressure, with gross margins declining to 14.8% due to rising input costs, particularly from tariffs. The company anticipates Q2 gross margins to further decline to a range of 13% to 14%, reflecting the continued impact of tariffs and uncertain pricing environments.

Sector Outlook and Delivery Forecasts: The company estimates the Class 8 market in the U.S. and Canada to be between 235,000 to 265,000 trucks for the year, and anticipates delivering 37,000 to 39,000 trucks in Q2 following 40,100 trucks delivered in Q1. In Europe, they expect the above 16-ton market to range from 270,000 to 300,000 trucks, indicating healthy demand but cautious based on economic conditions.

Parts Business Growth and Record Revenues: PACCAR Parts achieved record quarterly revenues of $1.7 billion and pretax income of $427 million, attributed to strong operational efficiencies and an expanding distribution network. The company projects parts sales to continue growing by 2% to 4% in Q2 and for the full year, benefiting from the growing number of connected vehicles operational.