Paccar Financial grows revenue, assets despite parent’s sales decline

Paccar Financial Services, the financial arm of truck manufacturer Paccar, increased revenues and financial services assets during the second quarter despite continued declines in sales at the parent company. 

Paccar delivered mixed results in the second quarter and the first half, with a strong performance in parts and financial services despite a year-over-year decline in net income and sales driven by market conditions and a non-recurring litigation charge, Chief Executive Preston Feight said in today’s earnings release. 

“Peterbilt, Kenworth and DAF delivered good results, Paccar Parts delivered record quarterly revenue and strong profits, and Paccar Financial Services (PFS) achieved very good results,” he said. “The North American truck market is being affected by economic conditions, the uncertain impact of tariffs and a soft truckload market.” 

Paccar projects this year’s U.S. and Canadian Class 8 truck retail sales to land in the range of 230,000 to 260,000 trucks, Feight said during today’s earnings call. 

“North American truck market size is a result of general economic conditions, a soft truckload market and tariff and [Environmental Protection Agency] 2027 policy uncertainty,” he said. “Customer demand in the less-than-truckload and vocational segments is good.” 

Regulatory emissions standards are expected to drive truck purchases later this year, as the upcoming 2027 policy will significantly reduce the allowable nitrous oxide (NOx) emissions from 200 milligrams to 35 milligrams, Feight said. As a result, while no additional greenhouse gas requirements are anticipated under the current administration, the stricter NOx standard is expected to go into effect and raise vehicle costs, prompting customers to buy ahead of the mandate. 

By the numbers

PFS issued $1.84 billion in medium-term notes in the first six months of 2025, with $1.1 billion coming in the second quarter and $695 million in the first quarter, with the notes supporting competitive retail financing for Kenworth, Peterbilt and DAF customers in 26 countries across four continents. PFS and its parent company also reported: 

• PFS revenue totaled $547.7 million in Q2, up 7.4% year over year;  

• PFS earned $123.2 million in pretax income in Q2, a 10.8% increase YoY; 

• PFS provision for losses on receivables rose to $29.2 million in Q2, up 149.6% YoY. 

• Paccar’s financial services assets were $23.3 billion, up 2.5% YoY. 

• Paccar’s net sales and revenues totaled $7.5 billion in Q2, down 14.4% YoY; and 

• Paccar’s net income finished at $723.8 million for Q2, down 35.5% YoY. 

In addition, improvements in the used-truck market helped boost PFS performance, Paccar Vice President Craig Gryniewicz said in the earnings release. 

NOTEWORTHY: PFS also manages a portfolio of 233,000 trucks and trailers, including a fleet of 40,000 vehicles from PacLease, the company’s North American and European truck leasing subsidiary, according to the earnings release. PacLease celebrated its 45th anniversary in 2025. 

Meanwhile, PFS plans to open a used truck center in Warsaw, Poland, this year to boost used truck sales in Central Europe, according to the release.

MARKET OUTLOOK: Shares of Paccar Inc. [Nasdaq: PCAR] were trading at $98.58 at market close today, up $5.67 or 6.1% from market open. Paccar has a market capitalization of $48.77 billion. 

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