Truck manufacturer PACCAR reported higher second-quarter profit on essentially flat revenue on Tuesday, saying build rates increased during the period as orders improved and freight rates strengthened.

PACCAR (NASDAQ: PCAR) reported second-quarter earnings of $1.43 per diluted share, 6 cents higher than a year earlier. Net income of $752 million rose 4 percent from the same period last year and was 24 percent higher than in the first quarter.

Revenue totaled $7.55 billion, essentially flat year over year and up less than 1 percent from $7.51 billion.

The company’s profit came on lower volume, underscoring the current state of Class 8 truck demand. PACCAR delivered 38,700 trucks globally in the quarter, down about 2 percent year over year. U.S. and Canada deliveries declined to 22,000 from 23,000 units. Record parts revenue and a nearly 17 percent year-over-year increase in truck segment pretax profit supported the result.

“PACCAR achieved very good revenues and increased net income by 24% in the second quarter of 2026 compared to the preceding quarter,” said Preston Feight, PACCAR chief executive officer, in a news release. “Build rates increased during the quarter due to strong orders as customers benefited from PACCAR’s industry-leading trucks and improved freight rates.”

The demand backdrop for Class 8 trucks

PACCAR said U.S. and Canada Class 8 industry retail sales are expected to be 230,000 to 270,000 units in 2026. North American deliveries have not yet reached that range: the company shipped 39,800 trucks in the U.S. and Canada in the first half, compared with 45,200 in the same period a year earlier.

What has shifted is the pressure on fleets that delayed replacement purchases, leaving age profiles higher across the market and making replacement demand more relevant as utilization improves.

“Customers are benefiting from higher freight rates due to constrained industry freight capacity. Fleet age has increased as well, providing an opportunity for customers to refresh their fleets with newer, more fuel-efficient trucks,” said John Rich, PACCAR executive vice president and chief technology officer.

Europe is already showing more momentum. DAF delivered 11,200 trucks in the quarter, up about 6 percent year over year, while European revenue increased about 7 percent year over year to $1.79 billion.

PACCAR Parts posts record revenue

PACCAR Parts reported record revenue of $1.75 billion, up 2 percent year over year, with pretax income of $417.0 million. The aftermarket unit now operates 21 global distribution centers covering more than 4 million square feet. It supports more than 2,000 DAF, Kenworth and Peterbilt locations, as well as more than 350 TRP stores.

The business benefits when trucks remain in service longer, because higher utilization tends to translate into more maintenance and replacement activity.

“The improved North American freight market will increase our customers’ truck utilization, which will deliver increased parts and service business,” said Bryan Sitko, PACCAR vice president and PACCAR Parts general manager.

PACCAR Financial sees higher provisions for losses

PACCAR Financial Services reported pretax income of $124.1 million on revenue of $549.7 million, both slightly above a year earlier. The portfolio includes 222,000 trucks and trailers and total assets of $22.3 billion.

For observers tracking carrier health, the provision for losses on receivables offered a more revealing data point. It increased to $39.4 million from $29.2 million a year earlier, and rose to $83.5 million from $47.5 million in the first half. Borrowers remain under pressure even as used-truck values improve.

“PFS achieved good first half results due to its steady finance margins and an improving used truck market,” said Craig Gryniewicz, PACCAR vice president.

Investment plans remain elevated

PACCAR invested $138.7 million in capital projects and $114.3 million in research and development during the quarter, while full-year spending guidance remains near record levels.

“Capital expenditures are projected to be in the range of $700 to $750 million and research and development expenses are estimated to be in the range of $450 to $480 million in 2026,” said Brice Poplawski, senior vice president and chief financial officer. “PACCAR continues to invest in next generation clean diesel, hybrid and battery-electric powertrains, integrated connected vehicle services, and expanded manufacturing capabilities.”

Rich also pointed to a regulatory development that could influence customer purchase timing.

“On July 9, the U.S. EPA provided helpful clarification of emissions regulations that will be beneficial to customers as they make truck purchasing decisions for the second half of this year and 2027,” he said.

PACCAR builds Kenworth, Peterbilt and DAF trucks, making its order book an early indicator of carrier capital spending. Rising build rates suggest fleets are beginning to replace aging equipment, while the company’s parts and finance businesses provide additional readthrough on how long trucks stay in service and how carrier balance sheets are holding up.