10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q/A

(Amendment No. 1)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2017 or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number:  0-27754

HUB GROUP, INC.

(Exact name of registrant as specified in its charter)

Delaware	36-4007085
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2000 Clearwater Drive

Oak Brook, Illinois 60523

(Address, including zip code, of principal executive offices)

(630) 271-3600

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.  See definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large Accelerated Filer	☒		Accelerated Filer	☐	Non-Accelerated Filer	☐	Smaller Reporting Company	☐
Emerging Growth Company		☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐ 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

On October 26, 2017, the registrant had 33,451,445 outstanding shares of Class A common stock, par value $.01 per share, and 662,296 outstanding shares of Class B common stock, par value $.01 per share.

Explanatory Note

Hub Group, Inc. is filing this Amendment No. 1 to its Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 (“Form 10-Q”) to add a date to the Section 906 certification in Exhibit 32.1.

HUB GROUP, INC.

INDEX

	Page
PART I.  Financial Information:
Consolidated Balance Sheets – September 30, 2017 (unaudited) and December 31, 2016	4
Unaudited Consolidated Statements of Income and Comprehensive Income – Three Months and Nine Months Ended September 30, 2017 and 2016	5
Unaudited Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2017 and 2016	6
Notes to Unaudited Consolidated Financial Statements	7
Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Quantitative and Qualitative Disclosures about Market Risk	26
Controls and Procedures	26
PART II.  Other Information	26

3

HUB GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

	September 30,			December 31,
	2017			2016
ASSETS	(unaudited)
CURRENT ASSETS:
Cash and cash equivalents	$	18,558		$	127,404
Accounts receivable trade, net		532,538			473,608
Accounts receivable other		10,017			4,331
Prepaid taxes		12,134			294
Prepaid expenses and other current assets		21,216			16,653
TOTAL CURRENT ASSETS		594,463			622,290
Restricted investments		24,066			20,877
Property and equipment, net		547,881			438,594
Other intangibles, net		75,772			11,844
Goodwill, net		348,506			262,376
Other assets		9,175			4,278
TOTAL ASSETS	$	1,599,863		$	1,360,259
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable trade	$	313,511		$	266,555
Accounts payable other		30,115			21,070
Accrued payroll		25,245			36,223
Accrued other		53,609			46,013
Current portion of capital lease		2,754			2,697
Current portion of long term debt		73,052			45,163
TOTAL CURRENT LIABILITIES		498,286			417,721
Long term debt		214,032			115,529
Non-current liabilities		29,181			23,595
Long term portion of capital lease		8,418			10,576
Deferred taxes		182,464			164,659
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value;  2,000,000 shares authorized;  no shares issued or outstanding in 2017 and 2016	-			-
Common stock
Class A:  $.01 par value;  97,337,700 shares authorized and 41,224,792 shares issued in 2017 and 2016; 33,451,445 shares outstanding in 2017 and 33,192,982 shares outstanding in 2016		412			412
Class B:  $.01 par value; 662,300 shares authorized; 662,296 shares issued and outstanding in 2017 and 2016		7			7
Additional paid-in capital		170,355			173,565
Purchase price in excess of predecessor basis, net of tax benefit of $10,306		(15,458	)		(15,458	)
Retained earnings		770,773			735,563
Accumulated other comprehensive loss		(172	)		(273	)
Treasury stock; at cost, 7,773,347 shares in 2017 and 8,031,810 shares in 2016		(258,435	)		(265,637	)
TOTAL STOCKHOLDERS' EQUITY		667,482			628,179
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,599,863		$	1,360,259

See notes to unaudited consolidated financial statements.

4

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME

(in thousands, except per share amounts)

	Three Months						Nine Months
	Ended September 30,						Ended September 30,
	2017			2016			2017			2016
Revenue	$	1,054,360		$	932,814		$	2,872,321		$	2,594,230
Transportation costs		937,836			821,360			2,552,895			2,259,899
Gross margin		116,524			111,454			319,426			334,331
Costs and expenses:
Salaries and benefits		49,126			42,610			137,343			130,075
Agent fees and commissions		19,072			19,072			54,103			54,334
General and administrative		22,403			17,641			63,341			50,368
Depreciation and amortization		4,254			2,276			9,215			6,559
Total costs and expenses		94,855			81,599			264,002			241,336
Operating income		21,669			29,855			55,424			92,995
Other income (expense):
Interest expense		(2,345	)		(888	)		(4,474	)		(2,655	)
Interest and dividend income		58			104			388			286
Other, net		404			27			597			1,178
Total other expense		(1,883	)		(757	)		(3,489	)		(1,191	)
Income before provision for income taxes		19,786			29,098			51,935			91,804
Provision for income taxes		4,452			11,174			16,725			35,243
Net income	$	15,334		$	17,924		$	35,210		$	56,561
Other comprehensive income:
Foreign currency translation adjustments		9			(10	)		101			(63	)
Total comprehensive income	$	15,343		$	17,914		$	35,311		$	56,498
Basic earnings per common share	$	0.46		$	0.54		$	1.06		$	1.66
Diluted earnings per common share	$	0.46		$	0.54		$	1.06		$	1.66
Basic weighted average number of shares outstanding		33,227			33,212			33,217			34,098
Diluted weighted average number of shares outstanding		33,335			33,366			33,323			34,172

See notes to unaudited consolidated financial statements.

5

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Nine Months Ended September 30,
	2017			2016
Cash flows from operating activities:
Net income	$	35,210		$	56,561
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		43,531			32,665
Deferred taxes		19,983			13,269
Compensation expense related to share-based compensation plans		7,402			6,318
Loss (gain) on sale of assets		360			(382	)
Excess tax benefits from share based compensation		-			(524	)
Changes in operating assets and liabilities:
Restricted investments		(3,189	)		545
Accounts receivable, net		(37,448	)		(62,324	)
Prepaid taxes		(11,839	)		(1,609	)
Prepaid expenses and other current assets		(3,059	)		1,244
Other assets		(3,505	)		961
Accounts payable		51,459			37,080
Accrued expenses		(13,179	)		(6,968	)
Non-current liabilities		1,419			2,181
Net cash provided by operating activities		87,145			79,017
Cash flows from investing activities:
Proceeds from sale of equipment		3,052			1,573
Purchases of property and equipment		(39,936	)		(59,883	)
Acquisitions, net of cash acquired		(165,933	)		-
Net cash used in investing activities		(202,817	)		(58,310	)
Cash flows from financing activities:
Proceeds from issuance of debt		73,606			36,100
Repayments of long term debt		(59,921	)		(25,074	)
Stock tendered for payments of withholding taxes		(3,410	)		(2,484	)
Purchase of treasury stock		-			(100,000	)
Capital lease payments		(2,101	)		(1,965	)
Excess tax benefits from share-based compensation		-			212
Payment of debt issuance costs		(1,397	)		-
Net cash provided by (used in) financing activities		6,777			(93,211	)
Effect of exchange rate changes on cash and cash equivalents		49			(50	)
Net decrease in cash and cash equivalents		(108,846	)		(72,554	)
Cash and cash equivalents beginning of the period		127,404			207,749
Cash and cash equivalents end of the period	$	18,558		$	135,195
Supplemental disclosures of cash paid for:
Interest	$	4,033		$	2,636
Income taxes	$	12,880		$	26,826

See notes to unaudited consolidated financial statements.

6

HUB GROUP, INC.

NOTES TO UNAUDITED

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. Interim Financial Statements

Our accompanying unaudited consolidated financial statements of Hub Group, Inc. (“we”, “us” or “our”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in annual financial statements have been omitted pursuant to those rules and regulations.  However, we believe that the disclosures contained herein are adequate to make the information presented not misleading.

The financial statements reflect, in our opinion, all material adjustments (which include only normal recurring adjustments) necessary to fairly present our financial position as of September 30, 2017 and results of operations for the three and nine months ended September 30, 2017 and 2016.

These unaudited consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2016.  Results of operations in interim periods are not necessarily indicative of results to be expected for a full year due partially to seasonality.

NOTE 2. Acquisition  

Hub Group Trucking (HGT), a wholly owned subsidiary of Hub Group, Inc., acquired all of the outstanding equity interests of Estenson Logistics, LLC (“Estenson”) on July 1, 2017 (the “Estenson Acquisition”).  Estenson is now our wholly owned subsidiary, operating under the name Hub Group Dedicated (“HGD”).  As a result of the Estenson Acquisition, HGT acquired substantially all of the assets of Estenson, which include tractors and trailers, as well as assumed certain liabilities, including equipment debt.  HGD is included in the Hub segment.

HGD has an operating fleet of approximately 1,000 tractors and over 3,600 trailers.  Dedicated services have been requested by our customers and we believe HGD is an excellent service offering that we can provide to our customers.

The base purchase price for Estenson was approximately $285 million, including contingent consideration related to an earn-out provision included in the Purchase Agreement, which will not exceed $6 million and is based on Estenson’s EBITDA results through June 30, 2019.  In accordance with the agreement, the base purchase price was adjusted by the assumed debt to arrive at the final consideration of $172 million.  To facilitate the acquisition, we assumed $113 million of Estenson debt and paid $166 million in cash, including $55 million of cash, which was borrowed under our new line of credit (See Note 6).

The following table summarizes the total purchase price allocated to the net assets acquired (in thousands):

Cash paid	$	165,945
Consideration payable		1,366
Contingent consideration, fair value		4,703
Total consideration		172,014
Equipment debt assumed		112,677
Total base purchase price	$	284,691

Pending finalization of the fair market value of assets acquired and liabilities assumed, revenue and lease contracts, and deferred taxes related to tax valuation/tax goodwill the measurement period remains open.  The following table summarizes the preliminary allocation of the total consideration to the assets acquired and liabilities assumed as of the date of the acquisition (in thousands):

7

	July 1, 2017
Cash and cash equivalents	$	12
Accounts receivable trade		27,000
Accounts receivable other		165
Prepaid expenses and other current assets		1,500
Property and equipment		128,477
Other intangibles		66,400
Goodwill		86,294
Other assets		64
Total assets acquired	$	309,912
Accounts payable trade	$	4,542
Accrued payroll		5,661
Accrued other		15,018
Equipment debt		112,677
Total liabilities assumed	$	137,898
Total consideration	$	172,014

The Estenson acquisition was accounted for as a purchase business combination in accordance with ASC 805 “Business Combinations.” Assets acquired and liabilities assumed were recorded in the accompanying consolidated balance sheet at their estimated fair values as of July 1, 2017 with the remaining unallocated purchase price recorded as goodwill. The goodwill recognized in the Estenson acquisition was primarily attributable to potential expansion and future development of the acquired business.  The fair value assigned to the customer relationships identifiable intangible was determined using an income approach based on management’s estimates and assumptions. The fair value assigned to the property and equipment was determined based on a market approach. A probability weighted expected return model was used to estimate the value of the contingent consideration.  Equipment debt was valued using a discounted cash flow analysis whereby future contractual principal repayments and interest payments for each instrument were discounted to the purchase date at a risk-adjusted discount rate.

We incurred approximately $1.6 million of acquisition costs associated with this transaction prior to the closing date that are reflected in general and administrative expense in the Unaudited Consolidated Statements of Income for the nine months ended September 30, 2017.

The components of “Other intangibles” listed in the above table as of the acquisition date are preliminarily estimated as follows (in thousands):

			Accumulated		Balance at		Estimated Useful
	Amount		Amortization		September 30, 2017		Life
Customer relationships	$	66,000	$	1,100	$	64,900	15 years
Trade name		400		400	-		3 months

The above intangible assets are amortized using the straight-line method.  Amortization expense related to this acquisition for both the three and nine month periods ended September 30, 2017 was $1.5 million.  The intangible assets have a weighted average useful life of approximately 15 years.  Amortization expense related to HGD for the next five years is as follows (in thousands):

Remainder 2017	$	1,100
2018		4,400
2019		4,400
2020		4,400
2021		4,400

8

The following unaudited pro forma consolidated results of operations for 2017 and 2016 assume that the acquisition of Estenson was completed as of January 1, 2016 (in thousands, except for per share amounts):

	Three Months
	Ended
	September 30, 2016
Revenue	$	988,345
Net income	$	20,249
Earnings per share
Basic	$	0.61
Diluted	$	0.61

	Nine Months		Nine Months
	Ended		Ended
	September 30, 2017		September 30, 2016
Revenue	$	2,986,342	$	2,752,660
Net income	$	39,387	$	62,212
Earnings per share
Basic	$	1.19	$	1.82
Diluted	$	1.18	$	1.82

The unaudited pro forma consolidated results for the three and nine month periods were prepared using the acquisition method of accounting and are based on the historical financial information of Hub and HGD. The historical financial information has been adjusted to give effect to the pro forma adjustments that are: (i) directly attributable to the acquisition, (ii) factually supportable and (iii) expected to have a continuing impact on the combined results. The unaudited pro forma consolidated results are not necessarily indicative of what our consolidated results of operations actually would have been had we completed the acquisition on January 1, 2016.

NOTE 3. Business Segments

We report two distinct business segments.  The first segment is Mode, which includes the Mode Transportation, LLC (“Mode LLC”) business we acquired on April 1, 2011.  The second segment is Hub, which is all business other than Mode.

Hub offers comprehensive intermodal, truck brokerage, dedicated and logistics services.  Our employees operate the freight through a network of operating centers located in the United States, Canada and Mexico.  Each operating center is strategically located in a market with a significant concentration of shipping customers and one or more railheads.  Hub has full time employees located throughout the United States, Canada and Mexico.

Mode LLC has Independent Business Owners (“IBOs”) who sell and operate the business throughout North America, as well as sales only agents.  Mode LLC also has a corporate office in Dallas, TX, a temperature protected services division, Temstar, located in Oak Brook, IL and corporate offices in Memphis, TN.

Mode LLC markets and operates its freight transportation services, consisting of intermodal, truck brokerage and logistics, primarily through agents who enter into contractual arrangements with Mode LLC.

9

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814
Transportation costs		734,747		228,227		(25,138	)		937,836		638,154		218,702		(35,496	)		821,360
Gross margin		86,055		30,469		-			116,524		78,545		32,909		-			111,454
Costs and expenses:
Salaries and benefits		45,727		3,399		-			49,126		38,775		3,835		-			42,610
Agent fees and commissions		15		19,057		-			19,072		20		19,052		-			19,072
General and administrative		20,520		1,883		-			22,403		15,969		1,672		-			17,641
Depreciation and amortization		3,962		292		-			4,254		1,959		317		-			2,276
Total costs and expenses		70,224		24,631		-			94,855		56,723		24,876		-			81,599
Operating income	$	15,831	$	5,838	$	-		$	21,669	$	21,822	$	8,033	$	-		$	29,855
Capital Expenditures	$	10,170	$	173	$	-		$	10,343	$	34,411	$	255	$	-		$	34,666

The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended September 30:

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	473,998	$	123,194	$	(13,665	)	$	583,527	$	466,283	$	126,052	$	(21,857	)	$	570,478
Truck brokerage		113,179		87,242		(634	)		199,787		96,906		79,627		(174	)		176,359
Logistics		175,679		48,260		(10,794	)		213,145		153,510		45,932		(13,465	)		185,977
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230
Transportation costs		1,972,725		654,612		(74,442	)		2,552,895		1,739,676		598,809		(78,586	)		2,259,899
Gross margin		230,417		89,009		-			319,426		240,774		93,557		-			334,331
Costs and expenses:
Salaries and benefits		126,891		10,452		-			137,343		118,658		11,417		-			130,075
Agent fees and commissions		46		54,057		-			54,103		47		54,287		-			54,334
General and administrative		57,330		6,011		-			63,341		44,917		5,451		-			50,368
Depreciation and amortization		8,319		896		-			9,215		5,603		956		-			6,559
Total costs and expenses		192,586		71,416		-			264,002		169,225		72,111		-			241,336
Operating income	$	37,831	$	17,593	$	-		$	55,424	$	71,549	$	21,446	$	-		$	92,995
Capital Expenditures	$	39,732	$	204	$	-		$	39,936	$	59,356	$	527	$	-		$	59,883

10

	As of September 30, 2017									As of December 31, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Total assets	$	1,421,628	$	184,996	$	(6,761	)	$	1,599,863	$	1,178,110	$	191,374	$	(9,225	)	$	1,360,259
Goodwill		319,117		29,389		-			348,506		232,987		29,389		-			262,376

The following tables summarize our revenue by segment and business line (in thousands) for the nine months ended September 30:

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	1,350,187	$	357,516	$	(41,768	)	$	1,665,935	$	1,318,223	$	355,379	$	(61,974	)	$	1,611,628
Truck brokerage		324,823		248,311		(1,330	)		571,804		261,456		228,350		(676	)		489,130
Logistics		470,186		137,794		(31,299	)		576,681		400,771		108,637		(15,936	)		493,472
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230

NOTE 4. Earnings Per Share

The following is a reconciliation of our earnings per share (in thousands, except for per share data):

	Three Months Ended, September 30,				Nine Months Ended, September 30,
	2017		2016		2017		2016
Net income for basic and diluted earnings per share	$	15,334	$	17,924	$	35,210	$	56,561
Weighted average shares outstanding - basic		33,227		33,212		33,217		34,098
Dilutive effect of  stock options and restricted stock		108		154		106		74
Weighted average shares outstanding - diluted		33,335		33,366		33,323		34,172
Earnings per share - basic	$	0.46	$	0.54	$	1.06	$	1.66
Earnings per share - diluted	$	0.46	$	0.54	$	1.06	$	1.66

NOTE 5. Fair Value Measurement

The carrying value of cash and cash equivalents, accounts receivable and accounts payable and long term debt approximated fair value as of September 30, 2017 and December 31, 2016 due to their short-term nature.

We consider as cash equivalents all highly liquid instruments with an original maturity of three months or less.  As of September 30, 2017 and December 31, 2016, our cash and temporary investments were with high quality financial institutions in Demand Deposit Accounts (DDAs) and Savings Accounts.

Restricted investments, as of September 30, 2017 of $24.1 million and December 31, 2016 of $20.9 million, included mutual funds which are reported at fair value.  

Our assets and liabilities measured at fair value are based on valuation techniques which consider prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. These valuation methods are based on either quoted market prices (Level 1) or inputs, other than quoted prices in active markets, that are observable either directly or indirectly (Level 2). Cash and cash equivalents, accounts receivable and accounts payable are defined as “Level 1”, while long term debt is defined as “Level 2” of the fair value hierarchy in the Fair Value Measurements and Disclosures Topic of the Codification.  

11

NOTE 6. Long-Term Debt and Financing Arrangements

We have standby letters of credit that expire at various dates in 2017 and 2018.  As of September 30, 2017, our letters of credit were $13.5 million.

On July 1, 2017, we entered into a $350 million unsecured credit agreement (the "Credit Agreement"). The Credit Agreement replaces the Amended and Restated Credit Agreement dated December 12, 2013 (“2013 Credit Agreement”). The Company used the Credit Agreement to finance, in part, the Estenson Acquisition.

Our unused and available borrowings under our new Credit Agreement were $286.5 million as of September 30, 2017. Our unused and available borrowings under the 2013 Credit Agreement were $38.2 million as of December 31, 2016. We were in compliance with our debt covenants as of September 30, 2017.

Borrowings under the Credit Agreement generally bear interest at a variable rate equal to (i) LIBOR plus a specified margin based upon the Borrowers' total net leverage ratio (as defined in the Credit Agreement) (the "Total Net Leverage Ratio"), or (ii) the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50% or (c) the sum of 1% plus one-month LIBOR) plus a specified margin based upon the Total Net Leverage Ratio. The specified margin for Eurodollar loans varies from 100.0 to 200.0 basis points per annum. The specified margin for base rate loans varies from 0.0 to 100.0 basis points per annum. The Borrowers must also pay (1) a commitment fee ranging from 10.0 to 25.0 basis points per annum (based upon the Total Net Leverage Ratio) on the aggregate unused commitments and (2) a letter of credit fee ranging from 100.0 to 200.0 basis points per annum (based upon the Total Net Leverage Ratio) on the undrawn amount of letters of credit.

The Credit Agreement contains various restrictions and covenants, including negative covenants that limit or restrict dividends, indebtedness of subsidiaries, mergers and fundamental changes, asset sales, acquisitions, liens and encumbrances, transactions with affiliates, changes in fiscal year and other matters customarily restricted in such agreements. The Company must maintain a Total Net Leverage Ratio of (a) total funded debt as of such date, minus up to $50,000,000 in unrestricted cash and cash equivalents (each as defined in the Credit Agreement) to (b) consolidated EBITDA (as defined in the credit agreement) of not more than 3.00 to 1.00; provided that as of the close of each of the four fiscal quarters occurring after the consummation of a permitted acquisition (as defined in the Credit Agreement) with an aggregate consideration of $150,000,000 or more, such ratio shall not be more than 3.25 to 1.00. The Company must maintain an interest coverage ratio of consolidated EBITDA to consolidated cash interest expense of not less than 3.00 to 1.00.

We incurred $1.4 million of financing costs related to the Credit Agreement during the third quarter of 2017, which we capitalized and will amortize to interest expense over the term of the agreement.  The unamortized balance of $1.3 million is included in Other assets in the Unaudited Consolidated Balance Sheet as of September 30, 2017.

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In addition to borrowings under our new credit agreement, we have entered into various Equipment Notes (“Notes”) for the purchase of tractors and containers.  The Notes are secured by the underlying equipment financed in the agreements.

	Period Ended
	September 30,			December 31,
	2017			2016
	(in thousands except principal and interest payments)
Revolving line of credit	$	50,000		$	-
Secured Equipment Notes due on various dates in 2024 with monthly principal and interest payments between $403 and $83,000 commencing on various dates in 2017; interest is paid monthly at a fixed annual rate between 2.85% and 3.28%		12,388			-
Secured Equipment Notes due on various dates in 2023 with monthly principal and interest payments between $669 and $41,238 commencing on various dates in 2016 and 2017; interest is paid monthly at a fixed annual rate between 2.23% and 3.12%		11,554			-
Secured Equipment Notes due on various dates in  2022 with monthly principal and interest payments between $3,030 and $254,190 commencing on various dates from 2015 to 2017; interest is paid monthly at a fixed annual rate of between 2.16% and 2.87%		32,517			-
Secured Equipment Notes due on various dates in 2021 with monthly principal and interest payments between $1,940 and $326,333 commencing on various dates from 2014 to 2017; interest is paid monthly at a fixed annual rate between 2.04% and 2.96%		81,176			59,836
Secured Equipment Notes due on various dates in 2020 with monthly principal and interest payments between $6,175 and $398,496 commencing on various dates from 2013 to 2016; interest is paid monthly at a fixed annual rate between 1.72% and 2.78%		57,305			48,633
Secured Equipment Notes due on various dates in 2019 with monthly principal and interest payments between $1,594 and $444,000 commencing on various dates from 2013 to 2015; interest is paid monthly at a fixed annual rate between 1.87% and 2.62%		40,803			49,464
Secured Equipment Notes due in June 2018 with monthly or quarterly principal and interest payments between $542 and $480,000 commencing on various dates from 2012 to 2014; interest is paid quarterly at a fixed annual rate between 1.89% and 4.45%		1,280			2,759
Secured Equipment Notes due on various dates in 2017 with monthly principal and interest payments between $12,964 and $19,792 commencing on various dates in 2012 and 2013; interest is paid monthly at a fixed annual rate between 2.06% and 2.11%		61			-
		287,084			160,692
Less current portion		(73,052	)		(45,163	)
Total long-term debt	$	214,032		$	115,529

NOTE 7. Commitments and Contingencies

In November 2016, we committed to acquire 4,000 53’ containers.  We expect the total purchase price of these containers to be approximately $40 million.  As of October 21, 2017, we have received 2,156 containers.  We anticipate receiving another 394 containers by the end of the year, with the remaining 1,450 to be delivered in 2018. We will be financing the purchase of this equipment with secured fixed rate debt.

We have entered in various agreements to purchase 154 tractors for a purchase price of approximately $18 million.  The equipment is expected to be delivered from October 2017 to January 2018.  We will be financing the purchase of this equipment with secured fixed rate debt.

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NOTE 8. Legal Matters  

Robles

On January 25, 2013, a complaint was filed in the U.S. District Court for the Eastern District of California (Sacramento Division) by Salvador Robles against our subsidiary, Comtrak Logistics, Inc., now known as Hub Group Trucking, Inc.  Mr. Robles drove a truck for Hub Group Trucking in California, first as an independent contractor and then as an employee.  The action was brought on behalf of a class comprised of present and former California-based truck drivers for Hub Group Trucking who were classified as independent contractors, from January 2009 to August 2014.  The complaint alleges Hub Group Trucking has misclassified such drivers as independent contractors and that such drivers were employees.  The complaint asserts various violations of the California Labor Code and claims that Hub Group Trucking has engaged in unfair competition practices.  The complaint seeks, among other things, declaratory and injunctive relief, compensatory damages and attorney’s fees. In May 2013, the complaint was amended to add similar claims based on Mr. Robles’ status as an employed company driver.  These additional claims are only on behalf of Mr. Robles and not a putative class.  

The Company believes that the California independent contractor truck drivers were properly classified as independent contractors at all times.  Nevertheless, because lawsuits are expensive, time-consuming and could interrupt our business operations, Hub Group Trucking decided to make settlement offers to individual drivers with respect to the claims alleged in this lawsuit, without admitting liability.  As of September 30, 2017, 93% of the California drivers have accepted the settlement offers which were paid in 2015 or earlier.  In late 2014, Hub Group Trucking decided to convert its model from independent contractors to employee drivers in California.  In early 2016, Hub Group Trucking closed its operations in Southern California.

On April 3, 2015, the Robles case was transferred to the U.S. District Court for the Western District of Tennessee (Western Division) in Memphis.  In May 2015, the plaintiffs in the Robles case filed a Second Amended Complaint (“SAC”) which names 334 current and former Hub Group Trucking drivers as “interested putative class members.”  In addition to reasserting their existing claims, the SAC includes claims post-conversion, added two new plaintiffs and seeks a judicial declaration that the settlement agreements are unenforceable.  In June 2015, Hub Group Trucking filed a motion to dismiss the SAC and on July 19, 2016, Hub Group Trucking’s motion to dismiss was granted in part, and denied in part, by the District Court.  The motion to dismiss was granted for the claims of all purported class members who have signed settlement agreements and on plaintiffs’ claims based on quantum merit and it was denied with respect to federal preemption and choice of law.  On August 11, 2016, Plaintiffs filed a motion to clarify whether the Court’s dismissal of the claims of all purported class members who signed settlement agreements was with or without prejudice and, if the dismissal was with prejudice, Plaintiffs moved the Court to revise and reconsider the order.  Plaintiffs’ motion to clarify is fully briefed and the parties are awaiting a decision by the Court.  

Adame

On August 5, 2015, the Plaintiffs’ law firm in the Robles case filed a lawsuit in state court in San Bernardino County, California on behalf of 63 named Plaintiffs against Hub Group Trucking and five Company employees.  The lawsuit alleges claims similar to those being made in Robles and seeks monetary penalties under the Private Attorneys General Act.  Of the 63 named Plaintiffs, at least 58 of them previously accepted the settlement offers referenced above.

On October 29, 2015, Defendants filed a notice of removal to remove the case from state court in San Bernardino to federal court in the Central District of California. On November 19, 2015, Defendants filed a motion to transfer the case to federal court in Memphis, Tennessee and also filed a motion to dismiss the case pursuant to a clause in the independent contractor agreement stating that Tennessee law applies.  Also on November 19, 2015, Plaintiffs filed a motion to remand the case back to state court, claiming that the federal court lacks jurisdiction over the case.  The court granted Plaintiffs’ motion to remand to the state court in San Bernardino County on April 7, 2016, mooting Defendants’ motions to transfer and dismiss.

On July 11, 2016, Defendants filed several motions in state court, asking the court to dismiss and/or stay the Plaintiffs’ suit for various reasons.  During a hearing on October 5, 2016, the judge issued an oral tentative ruling stating that the choice of forum provision was unenforceable.  On Defendants’ motion to dismiss the individual defendants, the court allowed for supplemental briefing for additional arguments regarding individual liability under PAGA.  The court did not reach a decision regarding the motion to stay pending the outcome in Robles.  Plaintiffs filed their supplemental brief on November 9, 2016 to which Defendants responded on December 6, 2016.  

On February 17, 2017, with the stipulation of the parties, the Court entered an Order dismissing, without prejudice, all of the individual Defendants and accepting the parties’ agreement that jurisdiction and venue are proper in the San Bernardino Superior Court and that Defendants will not seek to remove the case to federal district court.  On April 12, 2017, the Court denied Defendants’

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motion to dismiss based on insufficiency of the PAGA letter notice.  On October 5, 2017, Plaintiffs served an amended complaint, in part dismissing the previously named individuals as Defendants.

Lubinski

On September 12, 2014, a complaint was filed in the U.S. District Court for the Northern District of Illinois (Eastern Division) by Christian Lubinski against Hub Group Trucking.  The action was brought on behalf of a class comprised of present and former owner-operators providing delivery services in Illinois for Hub Group Trucking.  The complaint alleged Hub Group Trucking misclassified such drivers as independent contractors and that such drivers were employees.  The complaint also alleged that Hub Group Trucking made illegal deductions from the drivers’ pay and failed to properly compensate the drivers for all hours worked, reimburse business expenses, pay employment taxes, and provide workers’ compensation and other employment benefits.  The complaint asserted various violations of the Illinois Wage Payment and Collections Act and claimed that Hub Group Trucking was unjustly enriched.  The complaint sought, among other things, monetary damages for the relevant statutory period and attorneys’ fees.  

On October 24, 2014, the Lubinski case was transferred to the U.S. District Court for the Western District of Tennessee (Western Division), in Memphis.  On September 22, 2015, the court granted Hub Group Trucking’s motion to dismiss Lubinski’s Illinois law claims with prejudice based on the contractual choice of law provision, which provided that Tennessee law governed.  The court denied as moot Hub Group Trucking’s motion to dismiss based on federal preemption.  On October 2, 2015, Lubinski appealed this order to the United States Court of Appeals for the Sixth Circuit in Cincinnati.

On December 17, 2015, Lubinski filed his brief in support of his appeal of the motion to dismiss, asserting for the first time that the federal court did not have jurisdiction over the case due to a lack of diversity of citizenship.  Hub Group Trucking filed its response brief on January 19, 2016, in part arguing that Lubinski had himself alleged diversity of citizenship in his complaint.  Lubinski filed his reply brief on February 5, 2016.  On April 1, 2016, the Sixth Circuit remanded the case to the district court—without ruling on the merits—for the district court “to consider the argument and admit the evidence necessary to determine the question of federal subject-matter jurisdiction.”  

On July 11, 2016, with his federal district court case still pending, Lubinski filed an additional putative class action Complaint, with the same claims, in Illinois state court.  On the same day, Hub Group Trucking filed a declaratory judgment complaint in Tennessee state court, seeking a declaration that Lubinski’s claims must be heard in Tennessee (based on the contractual choice-of-forum provision) and that the claims must be dismissed because Tennessee law controls and Lubinski’s claims are preempted by federal law.

On October 26, 2016, Lubinski filed a motion to dismiss for lack of federal subject-matter jurisdiction and a motion for leave to file an amended complaint, attempting to “clarify” the putative class definition and arguing that the Class Action Fairness Act’s exceptions to jurisdiction apply.    In early 2017, Plaintiff’s counsel advised Hub Group Trucking that Lubinski would no longer challenge federal jurisdiction.  On February 15, 2017, the District Court adopted the parties’ stipulation and found that there is federal subject-matter jurisdiction.  On March 22, 2017, the U.S. Court of Appeals for the Sixth Circuit granted Plaintiff’s motion to recall the mandate and reinstate Lubinski’s appeal of the district court’s order dismissing the case.  On June 8, 2017, the Sixth Circuit issued an Opinion affirming the District Court’s dismissal of Plantiff’s claims.  On June 30, 2017, the Sixth Circuit issued the Mandate in the case, which terminates the 6^th Circuit appeal proceedings.  Plaintiff had until September 6, 2017, to ask the U.S. Supreme Court to review the case.  Plaintiff did not file any petition with the Supreme Court, so the case is completed.

We cannot reasonably estimate at this time the possible loss or range of loss, if any, that may arise from the remaining unresolved claims in the above mentioned lawsuits.

We are a party to other litigation incident to our business, including claims for personal injury and/or property damage, bankruptcy preference claims, and claims regarding freight lost or damaged in transit, improperly shipped or improperly billed.  Some of the lawsuits to which we are party are covered by insurance and are being defended by our insurance carriers.  Some of the lawsuits are not covered by insurance and we defend those ourselves.  We do not believe that the outcome of this litigation will have a materially adverse effect on our financial position or results of operations.

NOTE 9.New Pronouncements

In May 2014, the FASB issued Update No. 2014-09—Revenue from Contracts with Customers (Topic 606).  This Standard provides guidance on how to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.

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The FASB has recently issued several amendments to the standard, including clarification on the accounting for principal vs agent and identifying performance obligations.  

The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). We currently anticipate adopting the standard using the full retrospective method to restate each prior reporting period presented, if material.  We will elect to record sales tax on a net basis.  We do not expect this election to have a material impact on our consolidated financial statements.

Early application is permitted for annual reporting periods beginning after December 15, 2016.  We plan to adopt this standard January 1, 2018, as required.  

While we are continuing to assess all potential impacts of the standard, other than additional disclosures, we do not anticipate that this standard will have a material impact on our consolidated financial statements.  We have identified and analyzed our revenue streams and continue to analyze our current and historical contracts.

In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases.  Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  The new standard will become effective beginning with the first quarter of 2019.  Early adoption of the standard is permitted.  We plan to adopt this standard January 1, 2019, as required.  We are currently evaluating the impacts the adoption of this accounting guidance will have on the consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification of related amounts within the statement of cash flows. The new standard became effective beginning with the first quarter of 2017.  We adopted ASU 2016-09 in the first quarter of 2017 and the adoption did not have a material impact on our consolidated financial statements.  We have applied the reclassification of excess tax benefits prospectively and therefore the prior period has not been adjusted.

In 2016, the FASB issued new guidance that requires credit losses on financial assets measured at amortized cost basis to be presented at the net amount expected to be collected, not based on incurred losses.  The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 is permitted. We are evaluating the impact of adopting this new accounting guidance on our consolidated financial statements.

In 2016, the FASB issued new guidance which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows, including debt prepayment or extinguishment costs, settlement of contingent consideration arising from a business combination, insurance settlement proceeds, and distributions from certain equity method investees. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. We are evaluating the impact of adopting this new accounting guidance on our consolidated financial statements.

NOTE 10.Income Taxes

The provision for income taxes is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items.  Our effective income tax rate was 22.5% and 32.2% for the three and nine months ended September 30, 2017, respectively, as compared to 38.4% for both the three and nine months ended September 30, 2016.  The lower tax rates for 2017 were driven primarily by the impact of domestic production activities deductions.

NOTE 11.Subsequent Events

In October 2017, we entered into various agreements to purchase 38 tractors and 45 trailers for a purchase price of approximately $6 million.  The equipment is expected to be delivered by the end of 2017.  We will be financing the purchase of this equipment with secured fixed rate debt.

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HUB GROUP, INC.

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information contained in this quarterly report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Words such as “expects,” “hopes,” “believes,” “intends,” “estimates,” “anticipates,” “predicts,” “projects,” “potential,” “may,” “could,” “might,” “should,” and variations of these words and similar expressions are intended to identify these forward-looking statements.  Forward-looking statements are inherently uncertain and subject to risks. Such statements should be viewed with caution. Actual results or experience could differ materially from the forward-looking statements as a result of many factors. All forward-looking statements are based upon information available to us on the date of this report.  Except as required by law, we expressly disclaim any obligations to publicly release any revisions to forward-looking statements to reflect events after the date of this report.  Factors that could cause our actual results to differ materially include:

• the degree and rate of market growth in the domestic intermodal, truck brokerage, dedicated and logistics markets served by us;

• deterioration in our relationships with existing railroads or adverse changes to the railroads’ operating rules;

• changes in rail service conditions or adverse weather conditions;

• further consolidation of railroads;

• the impact of competitive pressures in the marketplace, including entry of new competitors, aggressive pricing, direct marketing efforts by the railroads or marketing efforts of asset-based carriers;

• our inability to price our services at high enough rates to maintain our historical margin levels;

• changes in rail, drayage and trucking company capacity;

• railroads moving away from ownership of intermodal assets;

• equipment shortages or equipment surplus;

• changes in the cost of services from rail, drayage, trucking, owner-operator drivers or other vendors and market pressures on company driver compensation;

• increases in costs related to any reclassification or change in our treatment of drivers or owner-operators due to regulatory, judicial and legal changes;

• labor unrest in the rail, drayage or trucking company communities;

• general economic and business conditions;

• inability to successfully protect our data against cyber-attacks;

• significant deterioration in our customers’ financial condition or bankruptcy, particularly in the retail, consumer products and durable goods sectors;

• fuel shortages or fluctuations in fuel prices;

• increases in interest rates;

• acts of terrorism and military action and the resulting effects on security;

• difficulties in maintaining, enhancing and transforming our information technology systems;

• increases in costs associated with changes to or new governmental regulations;

• significant increases to employee health insurance costs;

• loss of several of our largest customers;

• awards received during annual customer bids not materializing;

• loss of Mode LLC sales only agents or independent business owners (“IBOs”);

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• inability to recruit and retain key personnel and Mode LLC sales-only agents and IBOs;

• inability to recruit and maintain company drivers and owner-operators;

• changes in insurance costs and claims expense;

• union organizing efforts and changes to current laws which will aid in these efforts;

• inability to integrate the HGD business;

• inability to identify, close and/or successfully integrate any future business combinations; and

• imposition of new tariffs or trade barriers or withdrawal from or renegotiation of existing free trade agreements which could reduce international trade and economic activity.

EXECUTIVE SUMMARY

Hub Group, Inc.  (“we”, “us” or “our”) reports two distinct business segments.  The first segment is “Mode,” which includes the acquired Mode LLC business only.  The second segment is “Hub,” which is all business other than Mode. Hub Group (as opposed to just Hub), refers to the consolidated results for the whole company, including both the Mode and Hub segments.  For the segment financial results, refer to Note 3 to the unaudited consolidated financial statements.

We are one of the largest intermodal marketing companies (“IMC”) in the United States and a multi modal transportation provider offering intermodal, truck brokerage, dedicated and logistics services.  We operate through a nationwide network of operating centers and independent business owners.

As an IMC, we arrange for the movement of our customers’ freight in containers and trailers over long distances.  We contract with railroads to provide transportation for the long-haul portion of the shipment and with local trucking companies, known as “drayage companies,” for local pickup and delivery.  As part of the intermodal services, we negotiate rail and drayage rates, electronically track shipments in transit, consolidate billing and handle claims for freight loss or damage on behalf of our customers.

For the quarter ended September 30, 2017, approximately 53% of Hub’s drayage needs were met by our subsidiary, Hub Group Trucking, Inc., which assists us in providing reliable, cost effective intermodal services to our customers.  As of September 30, 2017, Hub Group Trucking leased or owned 915 tractors, owned 345 trailers, employed 1,011 drivers and contracted with 1,586 owner-operators for their services and equipment.

We also arrange for the transportation of freight by truck, providing customers with another option for their transportation needs.   We match the customers’ needs with carriers’ capacity to provide the most effective service and price combinations.  As part of our truck brokerage services, we negotiate rates, track shipments in transit and handle claims for freight loss or damage on behalf of our customers.

Our new dedicated service line, HGD, contracts with customers looking to outsource a portion of their transportation needs. We offer an exclusive dedicated fleet of equipment and drivers, as well as the management and infrastructure to operate according to the customer’s high service expectations. Our dedicated service line currently operates a fleet of approximately 986 tractors and 3,665 trailers at 119 locations throughout the United States.  As of September 30, 2017, HGD employed 1,269 drivers.

Our logistics service consists of complex transportation management services, including load consolidation, mode optimization and carrier management.  These service offerings are designed to take advantage of the increasing trend for shippers to outsource all or a greater portion of their transportation needs.

Hub has full time marketing representatives throughout North America who service local, regional and national accounts.  We believe that fostering long-term customer relationships is critical to our success and allows us to better understand our customers’ needs and specifically tailor our transportation services to them.

Hub’s yield management group works with pricing, account management and operations to enhance Hub’s customer margins.  We are working on margin enhancement projects including increasing prices, matching up inbound and outbound loads, reducing empty miles, improving our recovery of accessorial costs, reducing our drayage and accessorial costs, and reviewing and improving low contribution freight.

Hub’s top 50 customers represent approximately 64% of the Hub segment revenue for the nine months ended September 30, 2017.  We use various performance indicators to manage our business.  We closely monitor margin and volume for our top 50

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customers.  We also evaluate on-time performance, cost per load and daily sales outstanding by customer account.  Vendor cost changes and vendor service issues are also monitored closely.

Mode has approximately 175 agents, consisting of 102 sales/operating agents, known as Independent Business Owners (“IBOs”), who sell and operate the business throughout North America and 73 sales only agents.  Mode also has a corporate offices in Dallas, a temperature protected services division, Temstar, located in Oak Brook, IL and corporate offices in Memphis.  Mode’s top 20 customers represent approximately 39% of the Mode segment revenue for the nine months ended September 30, 2017.  We closely monitor revenue and margin for these customers.  We believe Mode brings us highly complementary service offerings, more scale and a talented sales channel that allows us to better reach small and midsize customers.  

RESULTS OF OPERATIONS

Three Months Ended September 30, 2017 Compared to the Three Months Ended September 30, 2016

The following table summarizes our revenue by segment and business line (in thousands) for the three months ended September 30:

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	473,998	$	123,194	$	(13,665	)	$	583,527	$	466,283	$	126,052	$	(21,857	)	$	570,478
Truck brokerage		113,179		87,242		(634	)		199,787		96,906		79,627		(174	)		176,359
Logistics		175,679		48,260		(10,794	)		213,145		153,510		45,932		(13,465	)		185,977
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814

Revenue

Hub Group’s revenue increased 13.0% to $1,054.4 million in 2017 from $932.8 million in 2016.

The Hub segment revenue increased 14.5% to $820.8 million. Intermodal revenue increased 1.7% to $474.0 million primarily due to an increase in fuel revenue and freight rates, partially offset by a slightly unfavorable mix. Truck brokerage revenue increased 16.8% to $113.2 million due to a 3.2% increase in volume, with fuel, price, and mix combined up 13.6%. Logistics revenue increased 14.4% to $175.7 million due to growth with new customers on-boarded this year. Dedicated’s revenue for the quarter was $57.9 million.

Mode’s revenue increased 2.8% to $258.7 million in 2017 from $251.6 million in 2016. Mode’s truck brokerage revenue increased 9.6% and logistics revenue increased 5.1% while intermodal revenue decreased 2.3%.

The following is a summary of operating results for our business segments (in thousands):

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814
Transportation costs		734,747		228,227		(25,138	)		937,836		638,154		218,702		(35,496	)		821,360
Gross margin		86,055		30,469		-			116,524		78,545		32,909		-			111,454
Costs and expenses:
Salaries and benefits		45,727		3,399		-			49,126		38,775		3,835		-			42,610
Agent fees and commissions		15		19,057		-			19,072		20		19,052		-			19,072
General and administrative		20,520		1,883		-			22,403		15,969		1,672		-			17,641
Depreciation and amortization		3,962		292		-			4,254		1,959		317		-			2,276
Total costs and expenses		70,224		24,631		-			94,855		56,723		24,876		-			81,599
Operating income	$	15,831	$	5,838	$	-		$	21,669	$	21,822	$	8,033	$	-		$	29,855

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Transportation Costs

Hub Group’s transportation costs increased 14.2% to $937.8 million in 2017 from $821.4 million in 2016.  Transportation costs in 2017 consisted of purchased transportation costs of $804.0 million and equipment and driver related costs of $133.8 million compared to 2016 costs of purchased transportation of $728.7 million and equipment and driver related costs of $92.7 million.

The Hub segment transportation costs increased 15.1% to $734.7 million in 2017 from $638.2 million in 2016.  Hub segment transportation costs in 2017 included $601.8 million in purchased transportation, up from $546.5 million in 2016. The 10.1% increase in purchased transportation costs was due primarily to rail cost increases, an increase in fuel costs and higher volumes.  Equipment and driver related costs increased 44.9% to $132.9 million in 2017 from $91.7 million in 2016 due primarily to the equipment and driver related costs of HGD.

The Mode segment transportation costs increased 4.4% to $228.2 million in 2017 from $218.7 million in 2016.  Mode segment transportation costs are primarily purchased transportation costs which increased due to growth in brokerage and logistics and rail cost increases in intermodal.    

Gross Margin

Hub Group’s gross margin increased 4.5% to $116.5 million in 2017 from $111.5 million in 2016. Hub Group’s gross margin as a percentage of sales decreased to 11.1% as compared to last year’s 11.9% margin.

The Hub segment gross margin increased 9.6% to $86.1 million.  The Hub segment margin increase of $7.5 million resulted from the addition of HGD and growth in truck brokerage margin partially offset by a decline in intermodal and logistics margin.  Intermodal gross margin decreased primarily because of rail cost increases and higher equipment costs, resulting partially from longer rail transits, partially offset by higher prices and improvement in loaded miles.  Truck brokerage gross margin increased due to changes in customer mix, higher value added business and more spot business.  Logistics gross margin declined primarily due to start-up costs related to new business on boarded this quarter, tighter truck capacity that resulted in higher purchased transportation costs, and changes in customer mix.

As a percentage of revenue, the Hub segment gross margin decreased slightly to 10.5% in 2017 from 11.0% in 2016.  Logistics gross margin as a percentage of sales decreased 250 basis points due to start-up costs related to new business on boarded this quarter, tighter truck capacity that resulted in higher purchased transportation costs, and changes in customer mix.  Intermodal gross margin as a percentage of sales decreased 160 basis points because of rail cost increases and higher equipment costs resulting partially from longer rail transits.  Truck brokerage gross margin as a percentage of sales decreased 100 basis points because of changes in customer mix and higher purchased transportation costs for contractual business.  These decreases were partially offset by the addition of HGD.

Mode’s gross margin decreased to $30.5 million in 2017 from $32.9 million in 2016 due to a decrease in intermodal and truck brokerage margin, partially offset by an increase in logistics gross margin.  Mode’s gross margin as a percentage of revenue decreased to 11.8% in 2017 from 13.1% in 2016 due to a 220 basis point decline in truck brokerage yields, a 130 basis point decline in intermodal yields, and a 30 basis point decline in logistics yields.

20

CONSOLIDATED OPERATING EXPENSES

The following table includes certain items in the consolidated statements of income as a percentage of revenue:

	Three Months Ended
	September 30,
	2017		2016
Revenue		100.0%		100.0%
Transportation costs		88.9		88.1
Gross margin		11.1		11.9
Costs and expenses:
Salaries and benefits		4.7		4.6
Agent fees and commissions		1.8		2.0
General and administrative		2.1		1.9
Depreciation and amortization		0.4		0.2
Total costs and expenses		9.0		8.7
Operating income		2.1		3.2

Salaries and Benefits

Hub Group’s salaries and benefits expense increased to $49.1 million in 2017 from $42.6 million in 2016.  As a percentage of revenue, Hub Group’s salaries and benefits increased to 4.7% in 2017 from 4.6% in 2016.

The Hub segment salaries and benefits expense increase of $7.0 million was primarily due to the acquisition of HGD and an increase in salaries expense of $1.2 million, partially offset by a decrease in bonus expense of $1.9 million.

Mode’s salaries and benefits expense decreased to $3.4 million in 2017 from $3.8 million in 2016 due primarily to decreases in employee bonus expense and salaries expense of $0.2 million each.

Hub Group’s headcount as of September 30, 2017 and 2016 was 2,034 and 1,746, respectively, which excludes drivers, as driver costs are included in transportation costs.  As of September 30, 2017 and 2016, Mode had 115 and 129 employees, respectively.

Agent Fees and Commissions

Hub Group’s agent fees and commissions expense remained consistent at $19.1 million in both 2017 and 2016.  As a percentage of revenue, these expenses decreased to 1.8% in 2017 from 2.0% in 2016.

The Mode segment agent fees and commissions expense remained consistent at $19.1 million in both 2017 and 2016.

General and Administrative

Hub Group’s general and administrative expense increased to $22.4 million in 2017 from $17.6 million in 2016.  These expenses, as a percentage of revenue, increased to 2.1% in 2017 from 1.9% in 2016.

The Hub segment increase in general and administrative expense of $4.6 million was due primarily to the acquisition of HGD and increases in IT consulting and professional service expense of $1.2 million, expenses related to a network optimization study of $0.6 million, temporary labor expense of $0.3 million and bad debt expense of $0.2 million, partially offset by a decrease in travel and entertainment expense of $0.3 million.

Mode’s general and administrative expense increased to $1.9 million 2017 from $1.7 million in 2016 due to increased IT maintenance expense, consulting and professional service expenses and bad debt expense.

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Depreciation and Amortization

Hub Group’s depreciation and amortization expense increased to $4.3 million in 2017 from $2.3 million in 2016.  This expense as a percentage of revenue increased to 0.4% in 2017 from 0.2% in 2016.

The Hub segment depreciation and amortization expense increased to $4.0 million in 2017 from $2.0 million in 2016.  This increase was related primarily to the amortization of the HGD trade name and customer relationships as well as depreciation of additional software.

Mode’s depreciation and amortization expense remained consistent at $0.3 million in both 2017 and 2016.

Other Income (Expense)

Total other expense increased to $1.9 million in 2017 from $0.8 million in 2016 due primarily to the acquisition of HGD and an increase in interest expense related to our equipment debt, partially offset by higher foreign currency translation gains in 2017.

Provision for Income Taxes

The provision for income taxes decreased to $4.5 million in 2017 from $11.2 million in 2016.  We provided for income taxes using an effective rate of 22.5% in 2017 and an effective rate of 38.4% in 2016.  The 2017 effective tax rate was lower primarily due to claiming a deduction for domestic production activities incurred during the 2013, 2016, and 2017 tax years.  We expect our effective tax rate for the remainder of 2017 to be between 31.5% and 32.5%.

Net Income

Net income decreased to $15.3 million in 2017 from $17.9 million in 2016 due primarily to higher operating expenses and interest expense, partially offset by increased margin and lower income tax expense in 2017.  All of the above are inclusive of the HGD acquisition.

Nine Months Ended September 30, 2017 Compared to the Nine Months Ended September 30, 2016

The following table summarizes our revenue by segment and business line (in thousands) for the nine months ended September 30:

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	1,350,187	$	357,516	$	(41,768	)	$	1,665,935	$	1,318,223	$	355,379	$	(61,974	)	$	1,611,628
Truck brokerage		324,823		248,311		(1,330	)		571,804		261,456		228,350		(676	)		489,130
Logistics		470,186		137,794		(31,299	)		576,681		400,771		108,637		(15,936	)		493,472
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230

Revenue

Hub Group’s revenue increased to $2.9 billion in 2017 from $2.6 billion 2016.  

The Hub segment revenue increased 11.2% to $2.2 billion. Intermodal revenue increased 2.4% to $1.4 billion primarily due to higher fuel revenue and 0.7% higher volume. This increase was partially offset by a decrease in price. Truck brokerage revenue increased 24.2% to $324.8 million due to an 11.5% volume increase as well as a 12.7% increase in fuel, mix and price combined. Logistics revenue increased 17.3% to $470.2 million related primarily to growth of new customers on-boarded in late 2016 and during 2017. Dedicated’s revenue was $57.9 million.

Mode’s revenue increased 7.4% to $743.6 million in 2017 from $692.4 million in 2016.  Mode’s intermodal revenue increased 0.6%, truck brokerage revenue increased 8.7% and logistics revenue increased 26.8%.

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The following is a summary of operating results for our business segments (in thousands):

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230
Transportation costs		1,972,725		654,612		(74,442	)		2,552,895		1,739,676		598,809		(78,586	)		2,259,899
Gross margin		230,417		89,009		-			319,426		240,774		93,557		-			334,331
Costs and expenses:
Salaries and benefits		126,891		10,452		-			137,343		118,658		11,417		-			130,075
Agent fees and commissions		46		54,057		-			54,103		47		54,287		-			54,334
General and administrative		57,330		6,011		-			63,341		44,917		5,451		-			50,368
Depreciation and amortization		8,319		896		-			9,215		5,603		956		-			6,559
Total costs and expenses		192,586		71,416		-			264,002		169,225		72,111		-			241,336
Operating income	$	37,831	$	17,593	$	-		$	55,424	$	71,549	$	21,446	$	-		$	92,995

Transportation Costs

Hub Group’s transportation costs increased to $2.6 billion in 2017 from $2.3 billion in 2016.  Transportation costs in 2017 consisted of purchased transportation costs of $2.2 billion and equipment and driver related costs of $316.0 million compared to 2016 costs of purchased transportation of $2.0 billion and equipment and driver related costs of $271.4 million.  

The Hub segment transportation cost increased by 13.4% to $2.0 billion in 2017 from $1.7 billion in 2016.  Hub segment transportation costs in 2017 included $1.66 billion in purchased transportation up from $1.47 billion in 2016. The 12.8% increase was due primarily to rail cost increases, an increase in fuel costs and higher volumes. Equipment and driver related costs increased 16.5% to $313.5 million in 2017 from $269.1 million in 2016 due primarily to the equipment and driver related costs of HGD.

The Mode segment transportation costs increased 9.3% to $654.6 million in 2017 from $598.8 million in 2016.  Mode segment transportation costs are primarily purchased transportation costs which increased due to higher rail costs, fuel costs, and increased business levels in logistics.

Gross Margin

Hub Group’s gross margin decreased 4.5% to $319.4 million in 2017 from $334.3 million in 2016.  

The Hub segment gross margin decreased 4.3% to $230.4 million.  Hub’s $10.4 million gross margin decrease resulted from a decrease in margin in intermodal and logistics partially offset by an increase in truck brokerage and dedicated margins.  Intermodal gross margin decreased primarily because of lower customer prices than last year and rail cost increases partially offset by slightly improved volume.  Logistics gross margin decreased due to changes in customer mix and start-up costs associated with new customer on-boardings.  Truck brokerage gross margin increased resulting from growth with targeted customer accounts.  The addition of HGD partially offset the overall gross margin decline.

As a percentage of Hub segment revenue, gross margin decreased to 10.5% in 2017 from 12.2% in 2016. Intermodal gross margin as a percentage of sales decreased 230 basis points because of lower customer prices than last year and rail cost increases partially offset by improved volume.  Truck brokerage gross margin as a percentage of sales was down 260 basis points due to lower customer contract rates, increased costs, and a change in customer mix. Logistics gross margin as a percentage of sales was down 170 basis points due to changes in customer mix and start-up costs associated with new customer on-boardings. The addition of HGD partially offset these declines.

Mode’s gross margin decreased 4.9% to $89.0 million in 2017 from $93.6 million in 2016 due primarily to decreases in intermodal and truck brokerage offset by an increase in logistics. Mode’s gross margin as a percentage of revenue decreased to 12.0% in 2017 from 13.5% in 2016.

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CONSOLIDATED OPERATING EXPENSES

The following table includes certain items in the consolidated statements of income as a percentage of revenue:

	Nine Months Ended
	September 30,
	2017		2016
Revenue		100.0%		100.0%
Transportation costs		88.9		87.1
Gross margin		11.1		12.9
Costs and expenses:
Salaries and benefits		4.8		5.0
Agent fees and commissions		1.9		2.1
General and administrative		2.2		1.9
Depreciation and amortization		0.3		0.3
Total costs and expenses		9.2		9.3
Operating income		1.9		3.6

Salaries and Benefits

Hub Group’s salaries and benefits expense increased to $137.3 million in 2017 from $130.1 million in 2016.  As a percentage of revenue, salaries and benefits decreased to 4.8% in 2017 from 5.0% in 2016.

The Hub segment salaries and benefits expense increase of $8.2 million to $126.9 million in 2017 from $118.7 million in 2016 was due primarily to the acquisition of HGD and an increase in salaries expense of $7.9 million, which includes increased severance expense of $2.4 million, partially offset by a decrease in bonus expense of $7.5 million.

Mode’s salaries and benefits expense decreased to $10.5 million in 2017 from $11.4 million in 2016.  The decrease was due primarily to decreases of $0.7 million related to employee bonus expense and $0.1 million related to both salaries expense and employee benefits expense.

Agent Fees and Commissions

Hub Group’s agent fees and commissions expense decreased to $54.1 million in 2017 from $54.3 million in 2016.  As a percentage of revenue, these expenses decreased to 1.9% in 2017 from 2.1% in 2016.

The Mode segment agent fees and commissions expense decrease of $0.2 million was due primarily to the decrease in Mode’s gross margin.

General and Administrative

Hub Group’s general and administrative expense increased to $63.3 million in 2017 from $50.4 million in 2016.  As a percentage of revenue, these expenses increased to 2.2% in 2017 from 1.9% in 2016.  

The Hub segment increase in general and administrative expense to $57.3 million in 2017 from $44.9 million in 2016 was due primarily to the acquisition of HGD and increases in IT consulting and professional service expense of $4.0 million, expenses related to due diligence and acquisition costs of $2.1 million, increased IT maintenance expense of $1.0 million, additional losses on the sale of fixed assets in 2017 of $0.6 million, expenses related to a network optimization study of $0.6 million in 2017, increases in temporary labor expense of $0.5 million, bad debt and rent expense of $0.4 million each, meals and entertainment and equipment lease expense of $0.3 million each, partially offset by a decrease in outside sales commissions and office expense of $0.3 million each.

Mode’s general and administrative expense increased to $6.0 million in 2017 from $5.5 million in 2016.  The increase was due primarily to an increase in IT consulting expense of $0.4 million and IT maintenance expense of $0.2 million, partially offset by a decrease in travel and entertainment expense of $0.1 million.

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Depreciation and Amortization

Hub Group’s depreciation and amortization expense increased to $9.2 million in 2017 from $6.6 million in 2016.  This expense as a percentage of revenue remained consistent at 0.3% in both 2017 and 2016.  

The Hub segment’s depreciation and amortization expense increased to $8.3 million in 2017 from $5.6 million in 2016.  This increase was related primarily to the amortization of the HGD trade name and customer relationships as well as depreciation of additional computer software.

Mode’s depreciation and amortization expense decreased to $0.9 million in 2017 from $1.0 in 2016.  

Other Income (Expense)

Total other expense increased to $3.5 million in 2017 from $1.2 million in 2016 due primarily to the acquisition of HGD, an increase in interest expense related to our equipment debt and by less foreign currency translation gains in 2017.

Provision for Income Taxes

The provision for income taxes decreased to $16.7 million in 2017 from $35.2 million in 2016.  Our effective rate was 32.2% in 2017 and 38.4% in 2016.  The 2017 effective tax rate was lower primarily due to claiming a deduction for domestic production activities incurred during the 2013, 2016, and 2017 tax years.  We expect our effective tax rate for the 2017 year to be between 32.0% and 33.0%.

Net Income

Net income decreased to $35.2 million in 2017 from $56.6 million in 2016 due primarily to decreased margin, higher operating expenses and interest expense, partially offset by lower income tax expense in 2017.  All of the above are inclusive of the HGD acquisition.

LIQUIDITY AND CAPITAL RESOURCES

During the first nine months of 2017, we funded operations, capital expenditures, an acquisition, capital leases, repayments of debt and stock buy backs related to employee withholding upon vesting of restricted stock through cash flows from operations, proceeds from the issuance of long-term debt and cash on hand.  We believe that our cash, cash flows from operations and borrowings available under our Credit Agreement will be sufficient to meet our cash needs for at least the next twelve months.

Cash provided by operating activities for the nine months ended September 30, 2017 was approximately $87.1 million, which resulted primarily from income of $35.2 million adjusted for non-cash charges of $71.3 million and a decrease in operating assets and liabilities of $19.3 million.

Cash provided by operating activities increased $8.1 million in 2017 versus 2016.  The increase was due to an increase in non-cash charges of $20.0 million resulting primarily from increased depreciation and amortization expense and an increase in operating assets and liabilities of $9.5 million due to the timing of customer and vendor payments in 2017 versus 2016.  These increases were partially offset by a decrease in net income of $21.4 million in 2017.

Net cash used in investing activities for the nine months ended September 30, 2017 was $202.8 million.  Acquisition payments related to HGD were $165.9 million. Capital expenditures of $39.9 million related primarily to containers of $14.6 million, technology investments of $14.5 million, transportation equipment of $7.6 million and the remainder for leasehold improvements.

In 2017, we expect to purchase 2,550 containers, which will be financed with debt.  As of the date of this report, we had already received 2,156 of the containers.  We are also investing in technology projects including transportation management systems and satellite tracking.  

We estimate our capital expenditures will range from $80 million to $85 million for the year.  

Net cash used in investing activities for the nine months ended September 30, 2016 was $58.3 million. The net cash used in investing activities increased $144.5 million in 2017 from 2016 and was due primarily to the acquisition of HGD and technology investments.

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The net cash provided by financing activities for the nine months ended September 30, 2017 was $6.8 million, which resulted from proceeds from the issuance of debt of $73.6 million, partially offset by the repayment of long-term debt of $59.9 million, stock tendered for payments of withholding taxes of $3.4 million, capital lease payments of $2.1 million and payment of debt issuance costs of $1.4 million.

The increase in net cash provided by financing activities of $100.0 million from 2016 to 2017 is primarily due to a decrease in the purchases of treasury stock of $100.0 million.

In 2017, we expect our cash paid for taxes to be significantly less than 2016 because of lower pretax income and large favorable timing differences between the 2017 tax depreciation and financial statement depreciation.

We have standby letters of credit that expire at various dates in 2017 and 2018.  As of September 30, 2017, our letters of credit were $13.5 million.

Our unused and available borrowings under our new Credit Agreement were $286.5 million as of September 30, 2017. Our unused and available borrowings under the 2013 Credit Agreement were $38.2 million as of December 31, 2016. We were in compliance with our debt covenants as of September 30, 2017.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk related to changes in interest rates on our bank line of credit which may adversely affect our results of operations and financial condition.  Although we conduct business in foreign countries, international operations are not material to our consolidated financial position, results of operations, or cash flows. Additionally, foreign currency transaction gains and losses were not material to our results of operations for the nine months ended September 30, 2017. Accordingly, we are not currently subject to material foreign currency exchange rate risks from the effects that exchange rate movements of foreign currencies would have on our future costs or on future cash flows we would receive from our foreign investment. To date, we have not entered into any foreign currency forward exchange contracts or other derivative financial instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates.   We do not use financial instruments for trading purposes.

We have both fixed and variable rate debt as described in Note 6 to the unaudited consolidated financial statements.  Any material increase in market interest rates would not have a material impact on the results of operations for the quarter ended September 30, 2017.

As of September 30, 2017, other than our outstanding letters of credit, we had $50.0 million of outstanding obligations under our bank line of credit arrangement.  As of December 31, 2016, other than our outstanding letters of credit, we had no outstanding obligations under our bank line of credit arrangement.

Item 4. CONTROLS AND PROCEDURES

As of September 30, 2017, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures. Based upon this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective as of September 30, 2017.  Except as noted below, there have been no changes in our internal control over financial reporting identified in connection with such evaluation that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

On July 1, 2017, we completed the acquisition of HGD.  We are currently integrating processes, employees, technologies and operations.  Management will continue to evaluate our internal controls over financial reporting as we complete the integration.

PART II. Other Information

Item 1. Legal Proceedings

During the nine months ended September 30, 2017, there have been no material developments from the legal proceedings disclosed in our Annual Report on Form 10-K for our fiscal year ended December 31, 2016, except those disclosed in Note 8 to the unaudited consolidated financial statements under “Legal Matters,” which is incorporated herein by reference.

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Item 1A. Risk Factors

During the nine months ended September 30, 2017, there have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for our year ended December 31, 2016.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We do not currently have a share repurchase plan in place.  During the third quarter of 2017, we purchased 3,058 shares at a weighted average price of $38.50 per share related to employee withholding upon vesting of restricted stock.

Item 6. Exhibits

The exhibits included as part of the Form 10-Q are set forth in the Exhibit Index immediately preceding such Exhibits and are incorporated herein by reference.

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EXHIBIT INDEX

Exhibit No.	Description
2.2	Amendment No. 1 to Purchase agreement dated July 1, 2017 by and between Estenson Logistics, LLC, Truline Corporation, the equity holders named therein, and Hub Group Trucking, Inc. (incorporated by reference to Exhibit 10.2 to our current report on Form 8-K filed with the SEC on July 6, 2017).
2.3	Credit Agreement dated July 1, 2017 among Hub Group, Inc., Hub City Terminals, the Guarantors, the Lenders and Bank of Montreal (incorporated by reference to Exhibit 10.1 to our current report on Form 8-Kfile with the SEC on July 6, 2017).
3.1	Amended and Restated Bylaws of Hub Group, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s report on Form 8-K dated February 18, 2016 and filed February 23, 2016, File No. 000-27754)
14	Hub Group, Inc. Code of Business Conduct and Ethics (incorporated by reference from Exhibit 14 to the Registrant’s report on Form 8-K dated February 17, 2017 and filed February 23, 2017, File No. 000-27754)
31.1	Certification of David P. Yeager, Chairman and Chief Executive Officer, Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.2	Certification of Terri A. Pizzuto, Executive Vice President, Chief Financial Officer and Treasurer, Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
32.1	Certification of David P. Yeager and Terri A. Pizzuto, Chief Executive Officer and Chief Financial Officer, respectively, Pursuant to 18 U.S.C. Section 1350.
101	The following financial statements and footnotes from the Hub Group Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 formatted in XBRL: (i) Consolidated Balance Sheets; (ii) Unaudited Consolidated Statements of Income and Other Comprehensive Income; (iii) Unaudited Consolidated Statements of Cash Flows; and (iv) Notes to Unaudited Consolidated Financial Statements.

28

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		HUB GROUP, INC.
DATE:	January 5, 2018	/s/ Terri A. Pizzuto
		Terri A. Pizzuto
		Executive Vice President, Chief Financial
		Officer and Treasurer
		(Principal Financial Officer)

29

EX-31.1

Exhibit 31.1

CERTIFICATION

I, David P. Yeager, certify that:

1) I have reviewed this report on Form 10-Q of Hub Group, Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting and;

5) The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: January 5, 2018
	/s/ David P.Yeager
	Name: David P. Yeager
	Title:   Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Terri A. Pizzuto, certify that:

1) I have reviewed this report on Form 10-Q of Hub Group, Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting and;

5) The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: January 5, 2018
	/s/ Terri A. Pizzuto
	Name: Terri A. Pizzuto
	Title:   Executive Vice President,
	Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

The following statement is provided by the undersigned to accompany the Form 10-Q for the quarter ended September 30, 2017 of Hub Group, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350) and shall not be deemed filed pursuant to any provision of the Exchange Act of 1934 or any other securities law.

Each of the undersigned certifies that the foregoing Report on Form 10-Q fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m) and that the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Hub Group, Inc.

Date: January 5, 2018

/s/ David P.Yeager	/s/ Terri A. Pizzuto
David P. Yeager	Terri A. Pizzuto
Chairman and Chief Executive Officer	Executive Vice President, Chief Financial Officer and Treasurer
Hub Group, Inc.	Hub Group, Inc.

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Oct. 26, 2017
Document Information [Line Items]
Document Type	10-Q/A
Amendment Flag	true
Amendment Description	Hub Group, Inc. is filing this Amendment No. 1 to its Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 (“Form 10-Q”) to add a date to the Section 906 certification in Exhibit 32.1.
Document Period End Date	Sep. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q3
Trading Symbol	HUBG
Entity Registrant Name	Hub Group, Inc.
Entity Central Index Key	0000940942
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Class A Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		33,451,445
Class B Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		662,296

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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
CURRENT ASSETS:
Cash and cash equivalents	$ 18,558	$ 127,404
Accounts receivable trade, net	532,538	473,608
Accounts receivable other	10,017	4,331
Prepaid taxes	12,134	294
Prepaid expenses and other current assets	21,216	16,653
TOTAL CURRENT ASSETS	594,463	622,290
Restricted investments	24,066	20,877
Property and equipment, net	547,881	438,594
Other intangibles, net	75,772	11,844
Goodwill, net	348,506	262,376
Other assets	9,175	4,278
TOTAL ASSETS	1,599,863	1,360,259
CURRENT LIABILITIES:
Accounts payable trade	313,511	266,555
Accounts payable other	30,115	21,070
Accrued payroll	25,245	36,223
Accrued other	53,609	46,013
Current portion of capital lease	2,754	2,697
Current portion of long term debt	73,052	45,163
TOTAL CURRENT LIABILITIES	498,286	417,721
Long term debt	214,032	115,529
Non-current liabilities	29,181	23,595
Long term portion of capital lease	8,418	10,576
Deferred taxes	182,464	164,659
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; 2,000,000 shares authorized; no shares issued or outstanding in 2017 and 2016
Additional paid-in capital	170,355	173,565
Purchase price in excess of predecessor basis, net of tax benefit of $10,306	(15,458)	(15,458)
Retained earnings	770,773	735,563
Accumulated other comprehensive loss	(172)	(273)
Treasury stock; at cost, 7,773,347 shares in 2017 and 8,031,810 shares in 2016	(258,435)	(265,637)
TOTAL STOCKHOLDERS' EQUITY	667,482	628,179
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	1,599,863	1,360,259
Class A Common Stock [Member]
STOCKHOLDERS' EQUITY:
Common stock	412	412
Class B Common Stock [Member]
STOCKHOLDERS' EQUITY:
Common stock	$ 7	$ 7

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Purchase price in excess of predecessor basis, tax benefit	$ 10,306
Treasury stock, shares	7,773,347	8,031,810
Class A Common Stock [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	97,337,700	97,337,700
Common stock, shares issued	41,224,792	41,224,792
Common stock, shares outstanding	33,451,445	33,192,982
Class B Common Stock [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	662,300	662,300
Common stock, shares issued	662,296	662,296
Common stock, shares outstanding	662,296	662,296

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UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Income Statement [Abstract]
Revenue	$ 1,054,360	$ 932,814	$ 2,872,321	$ 2,594,230
Transportation costs	937,836	821,360	2,552,895	2,259,899
Gross margin	116,524	111,454	319,426	334,331
Costs and expenses:
Salaries and benefits	49,126	42,610	137,343	130,075
Agent fees and commissions	19,072	19,072	54,103	54,334
General and administrative	22,403	17,641	63,341	50,368
Depreciation and amortization	4,254	2,276	9,215	6,559
Total costs and expenses	94,855	81,599	264,002	241,336
Operating income	21,669	29,855	55,424	92,995
Other income (expense):
Interest expense	(2,345)	(888)	(4,474)	(2,655)
Interest and dividend income	58	104	388	286
Other, net	404	27	597	1,178
Total other expense	(1,883)	(757)	(3,489)	(1,191)
Income before provision for income taxes	19,786	29,098	51,935	91,804
Provision for income taxes	4,452	11,174	16,725	35,243
Net income	15,334	17,924	35,210	56,561
Other comprehensive income:
Foreign currency translation adjustments	9	(10)	101	(63)
Total comprehensive income	$ 15,343	$ 17,914	$ 35,311	$ 56,498
Basic earnings per common share	$ 0.46	$ 0.54	$ 1.06	$ 1.66
Diluted earnings per common share	$ 0.46	$ 0.54	$ 1.06	$ 1.66
Basic weighted average number of shares outstanding	33,227	33,212	33,217	34,098
Diluted weighted average number of shares outstanding	33,335	33,366	33,323	34,172

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UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Cash flows from operating activities:
Net income	$ 35,210	$ 56,561
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	43,531	32,665
Deferred taxes	19,983	13,269
Compensation expense related to share-based compensation plans	7,402	6,318
Loss (gain) on sale of assets	360	(382)
Excess tax benefits from share based compensation		(524)
Changes in operating assets and liabilities:
Restricted investments	(3,189)	545
Accounts receivable, net	(37,448)	(62,324)
Prepaid taxes	(11,839)	(1,609)
Prepaid expenses and other current assets	(3,059)	1,244
Other assets	(3,505)	961
Accounts payable	51,459	37,080
Accrued expenses	(13,179)	(6,968)
Non-current liabilities	1,419	2,181
Net cash provided by operating activities	87,145	79,017
Cash flows from investing activities:
Proceeds from sale of equipment	3,052	1,573
Purchases of property and equipment	(39,936)	(59,883)
Acquisitions, net of cash acquired	(165,933)
Net cash used in investing activities	(202,817)	(58,310)
Cash flows from financing activities:
Proceeds from issuance of debt	73,606	36,100
Repayments of long term debt	(59,921)	(25,074)
Stock tendered for payments of withholding taxes	(3,410)	(2,484)
Purchase of treasury stock		(100,000)
Capital lease payments	(2,101)	(1,965)
Excess tax benefits from share-based compensation		212
Payment of debt issuance costs	(1,397)
Net cash provided by (used in) financing activities	6,777	(93,211)
Effect of exchange rate changes on cash and cash equivalents	49	(50)
Net decrease in cash and cash equivalents	(108,846)	(72,554)
Cash and cash equivalents beginning of the period	127,404	207,749
Cash and cash equivalents end of the period	18,558	135,195
Supplemental disclosures of cash paid for:
Interest	4,033	2,636
Income taxes	$ 12,880	$ 26,826

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Interim Financial Statements

9 Months Ended

Sep. 30, 2017

Quarterly Financial Information Disclosure [Abstract]

Interim Financial Statements

NOTE 1. Interim Financial Statements

Our accompanying unaudited consolidated financial statements of Hub Group, Inc. (“we”, “us” or “our”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in annual financial statements have been omitted pursuant to those rules and regulations.  However, we believe that the disclosures contained herein are adequate to make the information presented not misleading.

The financial statements reflect, in our opinion, all material adjustments (which include only normal recurring adjustments) necessary to fairly present our financial position as of September 30, 2017 and results of operations for the three and nine months ended September 30, 2017 and 2016.

These unaudited consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2016.  Results of operations in interim periods are not necessarily indicative of results to be expected for a full year due partially to seasonality.

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Acquisition

9 Months Ended

Sep. 30, 2017

Business Combinations [Abstract]

Acquisition

NOTE 2. Acquisition  

Hub Group Trucking (HGT), a wholly owned subsidiary of Hub Group, Inc., acquired all of the outstanding equity interests of Estenson Logistics, LLC (“Estenson”) on July 1, 2017 (the “Estenson Acquisition”).  Estenson is now our wholly owned subsidiary, operating under the name Hub Group Dedicated (“HGD”).  As a result of the Estenson Acquisition, HGT acquired substantially all of the assets of Estenson, which include tractors and trailers, as well as assumed certain liabilities, including equipment debt.  HGD is included in the Hub segment.

HGD has an operating fleet of approximately 1,000 tractors and over 3,600 trailers.  Dedicated services have been requested by our customers and we believe HGD is an excellent service offering that we can provide to our customers.

The base purchase price for Estenson was approximately $285 million, including contingent consideration related to an earn-out provision included in the Purchase Agreement, which will not exceed $6 million and is based on Estenson’s EBITDA results through June 30, 2019.  In accordance with the agreement, the base purchase price was adjusted by the assumed debt to arrive at the final consideration of $172 million.  To facilitate the acquisition, we assumed $113 million of Estenson debt and paid $166 million in cash, including $55 million of cash, which was borrowed under our new line of credit (See Note 6).

The following table summarizes the total purchase price allocated to the net assets acquired (in thousands):

Cash paid	$	165,945
Consideration payable		1,366
Contingent consideration, fair value		4,703
Total consideration		172,014
Equipment debt assumed		112,677
Total base purchase price	$	284,691

Pending finalization of the fair market value of assets acquired and liabilities assumed, revenue and lease contracts, and deferred taxes related to tax valuation/tax goodwill the measurement period remains open.  The following table summarizes the preliminary allocation of the total consideration to the assets acquired and liabilities assumed as of the date of the acquisition (in thousands):

	July 1, 2017
Cash and cash equivalents	$	12
Accounts receivable trade		27,000
Accounts receivable other		165
Prepaid expenses and other current assets		1,500
Property and equipment		128,477
Other intangibles		66,400
Goodwill		86,294
Other assets		64
Total assets acquired	$	309,912
Accounts payable trade	$	4,542
Accrued payroll		5,661
Accrued other		15,018
Equipment debt		112,677
Total liabilities assumed	$	137,898
Total consideration	$	172,014

The Estenson acquisition was accounted for as a purchase business combination in accordance with ASC 805 “Business Combinations.” Assets acquired and liabilities assumed were recorded in the accompanying consolidated balance sheet at their estimated fair values as of July 1, 2017 with the remaining unallocated purchase price recorded as goodwill. The goodwill recognized in the Estenson acquisition was primarily attributable to potential expansion and future development of the acquired business.  The fair value assigned to the customer relationships identifiable intangible was determined using an income approach based on management’s estimates and assumptions. The fair value assigned to the property and equipment was determined based on a market approach. A probability weighted expected return model was used to estimate the value of the contingent consideration.  Equipment debt was valued using a discounted cash flow analysis whereby future contractual principal repayments and interest payments for each instrument were discounted to the purchase date at a risk-adjusted discount rate.

We incurred approximately $1.6 million of acquisition costs associated with this transaction prior to the closing date that are reflected in general and administrative expense in the Unaudited Consolidated Statements of Income for the nine months ended September 30, 2017.

The components of “Other intangibles” listed in the above table as of the acquisition date are preliminarily estimated as follows (in thousands):

			Accumulated		Balance at		Estimated Useful
	Amount		Amortization		September 30, 2017		Life
Customer relationships	$	66,000	$	1,100	$	64,900	15 years
Trade name		400		400	-		3 months

The above intangible assets are amortized using the straight-line method.  Amortization expense related to this acquisition for both the three and nine month periods ended September 30, 2017 was $1.5 million.  The intangible assets have a weighted average useful life of approximately 15 years.  Amortization expense related to HGD for the next five years is as follows (in thousands):

Remainder 2017	$	1,100
2018		4,400
2019		4,400
2020		4,400
2021		4,400

The following unaudited pro forma consolidated results of operations for 2017 and 2016 assume that the acquisition of Estenson was completed as of January 1, 2016 (in thousands, except for per share amounts):

	Three Months
	Ended
	September 30, 2016
Revenue	$	988,345
Net income	$	20,249
Earnings per share
Basic	$	0.61
Diluted	$	0.61

	Nine Months		Nine Months
	Ended		Ended
	September 30, 2017		September 30, 2016
Revenue	$	2,986,342	$	2,752,660
Net income	$	39,387	$	62,212
Earnings per share
Basic	$	1.19	$	1.82
Diluted	$	1.18	$	1.82

The unaudited pro forma consolidated results for the three and nine month periods were prepared using the acquisition method of accounting and are based on the historical financial information of Hub and HGD. The historical financial information has been adjusted to give effect to the pro forma adjustments that are: (i) directly attributable to the acquisition, (ii) factually supportable and (iii) expected to have a continuing impact on the combined results. The unaudited pro forma consolidated results are not necessarily indicative of what our consolidated results of operations actually would have been had we completed the acquisition on January 1, 2016.

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Business Segments

9 Months Ended

Sep. 30, 2017

Segment Reporting [Abstract]

Business Segments

NOTE 3. Business Segments

We report two distinct business segments.  The first segment is Mode, which includes the Mode Transportation, LLC (“Mode LLC”) business we acquired on April 1, 2011.  The second segment is Hub, which is all business other than Mode.

Hub offers comprehensive intermodal, truck brokerage, dedicated and logistics services.  Our employees operate the freight through a network of operating centers located in the United States, Canada and Mexico.  Each operating center is strategically located in a market with a significant concentration of shipping customers and one or more railheads.  Hub has full time employees located throughout the United States, Canada and Mexico.

Mode LLC has Independent Business Owners (“IBOs”) who sell and operate the business throughout North America, as well as sales only agents.  Mode LLC also has a corporate office in Dallas, TX, a temperature protected services division, Temstar, located in Oak Brook, IL and corporate offices in Memphis, TN.

Mode LLC markets and operates its freight transportation services, consisting of intermodal, truck brokerage and logistics, primarily through agents who enter into contractual arrangements with Mode LLC.

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814
Transportation costs		734,747		228,227		(25,138	)		937,836		638,154		218,702		(35,496	)		821,360
Gross margin		86,055		30,469		-			116,524		78,545		32,909		-			111,454
Costs and expenses:
Salaries and benefits		45,727		3,399		-			49,126		38,775		3,835		-			42,610
Agent fees and commissions		15		19,057		-			19,072		20		19,052		-			19,072
General and administrative		20,520		1,883		-			22,403		15,969		1,672		-			17,641
Depreciation and amortization		3,962		292		-			4,254		1,959		317		-			2,276
Total costs and expenses		70,224		24,631		-			94,855		56,723		24,876		-			81,599
Operating income	$	15,831	$	5,838	$	-		$	21,669	$	21,822	$	8,033	$	-		$	29,855
Capital Expenditures	$	10,170	$	173	$	-		$	10,343	$	34,411	$	255	$	-		$	34,666

The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended September 30:

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	473,998	$	123,194	$	(13,665	)	$	583,527	$	466,283	$	126,052	$	(21,857	)	$	570,478
Truck brokerage		113,179		87,242		(634	)		199,787		96,906		79,627		(174	)		176,359
Logistics		175,679		48,260		(10,794	)		213,145		153,510		45,932		(13,465	)		185,977
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230
Transportation costs		1,972,725		654,612		(74,442	)		2,552,895		1,739,676		598,809		(78,586	)		2,259,899
Gross margin		230,417		89,009		-			319,426		240,774		93,557		-			334,331
Costs and expenses:
Salaries and benefits		126,891		10,452		-			137,343		118,658		11,417		-			130,075
Agent fees and commissions		46		54,057		-			54,103		47		54,287		-			54,334
General and administrative		57,330		6,011		-			63,341		44,917		5,451		-			50,368
Depreciation and amortization		8,319		896		-			9,215		5,603		956		-			6,559
Total costs and expenses		192,586		71,416		-			264,002		169,225		72,111		-			241,336
Operating income	$	37,831	$	17,593	$	-		$	55,424	$	71,549	$	21,446	$	-		$	92,995
Capital Expenditures	$	39,732	$	204	$	-		$	39,936	$	59,356	$	527	$	-		$	59,883

	As of September 30, 2017									As of December 31, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Total assets	$	1,421,628	$	184,996	$	(6,761	)	$	1,599,863	$	1,178,110	$	191,374	$	(9,225	)	$	1,360,259
Goodwill		319,117		29,389		-			348,506		232,987		29,389		-			262,376

The following tables summarize our revenue by segment and business line (in thousands) for the nine months ended September 30:

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	1,350,187	$	357,516	$	(41,768	)	$	1,665,935	$	1,318,223	$	355,379	$	(61,974	)	$	1,611,628
Truck brokerage		324,823		248,311		(1,330	)		571,804		261,456		228,350		(676	)		489,130
Logistics		470,186		137,794		(31,299	)		576,681		400,771		108,637		(15,936	)		493,472
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230

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Earnings Per Share

9 Months Ended

Sep. 30, 2017

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 4. Earnings Per Share

The following is a reconciliation of our earnings per share (in thousands, except for per share data):

	Three Months Ended, September 30,				Nine Months Ended, September 30,
	2017		2016		2017		2016
Net income for basic and diluted earnings per share	$	15,334	$	17,924	$	35,210	$	56,561
Weighted average shares outstanding - basic		33,227		33,212		33,217		34,098
Dilutive effect of  stock options and restricted stock		108		154		106		74
Weighted average shares outstanding - diluted		33,335		33,366		33,323		34,172
Earnings per share - basic	$	0.46	$	0.54	$	1.06	$	1.66
Earnings per share - diluted	$	0.46	$	0.54	$	1.06	$	1.66

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Fair Value Measurement

9 Months Ended

Sep. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurement

NOTE 5. Fair Value Measurement

The carrying value of cash and cash equivalents, accounts receivable and accounts payable and long term debt approximated fair value as of September 30, 2017 and December 31, 2016 due to their short-term nature.

We consider as cash equivalents all highly liquid instruments with an original maturity of three months or less.  As of September 30, 2017 and December 31, 2016, our cash and temporary investments were with high quality financial institutions in Demand Deposit Accounts (DDAs) and Savings Accounts.

Restricted investments, as of September 30, 2017 of $24.1 million and December 31, 2016 of $20.9 million, included mutual funds which are reported at fair value.  

Our assets and liabilities measured at fair value are based on valuation techniques which consider prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. These valuation methods are based on either quoted market prices (Level 1) or inputs, other than quoted prices in active markets, that are observable either directly or indirectly (Level 2). Cash and cash equivalents, accounts receivable and accounts payable are defined as “Level 1”, while long term debt is defined as “Level 2” of the fair value hierarchy in the Fair Value Measurements and Disclosures Topic of the Codification.  

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Long-Term Debt and Financing Arrangements

9 Months Ended

Sep. 30, 2017

Debt Disclosure [Abstract]

Long-Term Debt and Financing Arrangements

NOTE 6. Long-Term Debt and Financing Arrangements

We have standby letters of credit that expire at various dates in 2017 and 2018.  As of September 30, 2017, our letters of credit were $13.5 million.

On July 1, 2017, we entered into a $350 million unsecured credit agreement (the "Credit Agreement"). The Credit Agreement replaces the Amended and Restated Credit Agreement dated December 12, 2013 (“2013 Credit Agreement”). The Company used the Credit Agreement to finance, in part, the Estenson Acquisition.

Our unused and available borrowings under our new Credit Agreement were $286.5 million as of September 30, 2017. Our unused and available borrowings under the 2013 Credit Agreement were $38.2 million as of December 31, 2016. We were in compliance with our debt covenants as of September 30, 2017.

Borrowings under the Credit Agreement generally bear interest at a variable rate equal to (i) LIBOR plus a specified margin based upon the Borrowers' total net leverage ratio (as defined in the Credit Agreement) (the "Total Net Leverage Ratio"), or (ii) the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50% or (c) the sum of 1% plus one-month LIBOR) plus a specified margin based upon the Total Net Leverage Ratio. The specified margin for Eurodollar loans varies from 100.0 to 200.0 basis points per annum. The specified margin for base rate loans varies from 0.0 to 100.0 basis points per annum. The Borrowers must also pay (1) a commitment fee ranging from 10.0 to 25.0 basis points per annum (based upon the Total Net Leverage Ratio) on the aggregate unused commitments and (2) a letter of credit fee ranging from 100.0 to 200.0 basis points per annum (based upon the Total Net Leverage Ratio) on the undrawn amount of letters of credit.

The Credit Agreement contains various restrictions and covenants, including negative covenants that limit or restrict dividends, indebtedness of subsidiaries, mergers and fundamental changes, asset sales, acquisitions, liens and encumbrances, transactions with affiliates, changes in fiscal year and other matters customarily restricted in such agreements. The Company must maintain a Total Net Leverage Ratio of (a) total funded debt as of such date, minus up to $50,000,000 in unrestricted cash and cash equivalents (each as defined in the Credit Agreement) to (b) consolidated EBITDA (as defined in the credit agreement) of not more than 3.00 to 1.00; provided that as of the close of each of the four fiscal quarters occurring after the consummation of a permitted acquisition (as defined in the Credit Agreement) with an aggregate consideration of $150,000,000 or more, such ratio shall not be more than 3.25 to 1.00. The Company must maintain an interest coverage ratio of consolidated EBITDA to consolidated cash interest expense of not less than 3.00 to 1.00.

We incurred $1.4 million of financing costs related to the Credit Agreement during the third quarter of 2017, which we capitalized and will amortize to interest expense over the term of the agreement.  The unamortized balance of $1.3 million is included in Other assets in the Unaudited Consolidated Balance Sheet as of September 30, 2017.

In addition to borrowings under our new credit agreement, we have entered into various Equipment Notes (“Notes”) for the purchase of tractors and containers.  The Notes are secured by the underlying equipment financed in the agreements.

	Period Ended
	September 30,			December 31,
	2017			2016
	(in thousands except principal and interest payments)
Revolving line of credit	$	50,000		$	-
Secured Equipment Notes due on various dates in 2024 with monthly principal and interest payments between $403 and $83,000 commencing on various dates in 2017; interest is paid monthly at a fixed annual rate between 2.85% and 3.28%		12,388			-
Secured Equipment Notes due on various dates in 2023 with monthly principal and interest payments between $669 and $41,238 commencing on various dates in 2016 and 2017; interest is paid monthly at a fixed annual rate between 2.23% and 3.12%		11,554			-
Secured Equipment Notes due on various dates in  2022 with monthly principal and interest payments between $3,030 and $254,190 commencing on various dates from 2015 to 2017; interest is paid monthly at a fixed annual rate of between 2.16% and 2.87%		32,517			-
Secured Equipment Notes due on various dates in 2021 with monthly principal and interest payments between $1,940 and $326,333 commencing on various dates from 2014 to 2017; interest is paid monthly at a fixed annual rate between 2.04% and 2.96%		81,176			59,836
Secured Equipment Notes due on various dates in 2020 with monthly principal and interest payments between $6,175 and $398,496 commencing on various dates from 2013 to 2016; interest is paid monthly at a fixed annual rate between 1.72% and 2.78%		57,305			48,633
Secured Equipment Notes due on various dates in 2019 with monthly principal and interest payments between $1,594 and $444,000 commencing on various dates from 2013 to 2015; interest is paid monthly at a fixed annual rate between 1.87% and 2.62%		40,803			49,464
Secured Equipment Notes due in June 2018 with monthly or quarterly principal and interest payments between $542 and $480,000 commencing on various dates from 2012 to 2014; interest is paid quarterly at a fixed annual rate between 1.89% and 4.45%		1,280			2,759
Secured Equipment Notes due on various dates in 2017 with monthly principal and interest payments between $12,964 and $19,792 commencing on various dates in 2012 and 2013; interest is paid monthly at a fixed annual rate between 2.06% and 2.11%		61			-
		287,084			160,692
Less current portion		(73,052	)		(45,163	)
Total long-term debt	$	214,032		$	115,529

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2017

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 7. Commitments and Contingencies

In November 2016, we committed to acquire 4,000 53’ containers.  We expect the total purchase price of these containers to be approximately $40 million.  As of October 21, 2017, we have received 2,156 containers.  We anticipate receiving another 394 containers by the end of the year, with the remaining 1,450 to be delivered in 2018. We will be financing the purchase of this equipment with secured fixed rate debt.

We have entered in various agreements to purchase 154 tractors for a purchase price of approximately $18 million.  The equipment is expected to be delivered from October 2017 to January 2018.  We will be financing the purchase of this equipment with secured fixed rate debt.

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Legal Matters

9 Months Ended

Sep. 30, 2017

Commitments And Contingencies Disclosure [Abstract]

Legal Matters

NOTE 8. Legal Matters  

Robles

On January 25, 2013, a complaint was filed in the U.S. District Court for the Eastern District of California (Sacramento Division) by Salvador Robles against our subsidiary, Comtrak Logistics, Inc., now known as Hub Group Trucking, Inc.  Mr. Robles drove a truck for Hub Group Trucking in California, first as an independent contractor and then as an employee.  The action was brought on behalf of a class comprised of present and former California-based truck drivers for Hub Group Trucking who were classified as independent contractors, from January 2009 to August 2014.  The complaint alleges Hub Group Trucking has misclassified such drivers as independent contractors and that such drivers were employees.  The complaint asserts various violations of the California Labor Code and claims that Hub Group Trucking has engaged in unfair competition practices.  The complaint seeks, among other things, declaratory and injunctive relief, compensatory damages and attorney’s fees.  In May 2013, the complaint was amended to add similar claims based on Mr. Robles’ status as an employed company driver.  These additional claims are only on behalf of Mr. Robles and not a putative class.  

The Company believes that the California independent contractor truck drivers were properly classified as independent contractors at all times.  Nevertheless, because lawsuits are expensive, time-consuming and could interrupt our business operations, Hub Group Trucking decided to make settlement offers to individual drivers with respect to the claims alleged in this lawsuit, without admitting liability.  As of September 30, 2017, 93% of the California drivers have accepted the settlement offers which were paid in 2015 or earlier.  In late 2014, Hub Group Trucking decided to convert its model from independent contractors to employee drivers in California.  In early 2016, Hub Group Trucking closed its operations in Southern California.

On April 3, 2015, the Robles case was transferred to the U.S. District Court for the Western District of Tennessee (Western Division) in Memphis.  In May 2015, the plaintiffs in the Robles case filed a Second Amended Complaint (“SAC”) which names 334 current and former Hub Group Trucking drivers as “interested putative class members.”  In addition to reasserting their existing claims, the SAC includes claims post-conversion, added two new plaintiffs and seeks a judicial declaration that the settlement agreements are unenforceable.  In June 2015, Hub Group Trucking filed a motion to dismiss the SAC and on July 19, 2016, Hub Group Trucking’s motion to dismiss was granted in part, and denied in part, by the District Court.  The motion to dismiss was granted for the claims of all purported class members who have signed settlement agreements and on plaintiffs’ claims based on quantum merit and it was denied with respect to federal preemption and choice of law.  On August 11, 2016, Plaintiffs filed a motion to clarify whether the Court’s dismissal of the claims of all purported class members who signed settlement agreements was with or without prejudice and, if the dismissal was with prejudice, Plaintiffs moved the Court to revise and reconsider the order.  Plaintiffs’ motion to clarify is fully briefed and the parties are awaiting a decision by the Court.  

Adame

On August 5, 2015, the Plaintiffs’ law firm in the Robles case filed a lawsuit in state court in San Bernardino County, California on behalf of 63 named Plaintiffs against Hub Group Trucking and five Company employees.  The lawsuit alleges claims similar to those being made in Robles and seeks monetary penalties under the Private Attorneys General Act.  Of the 63 named Plaintiffs, at least 58 of them previously accepted the settlement offers referenced above.

On October 29, 2015, Defendants filed a notice of removal to remove the case from state court in San Bernardino to federal court in the Central District of California. On November 19, 2015, Defendants filed a motion to transfer the case to federal court in Memphis, Tennessee and also filed a motion to dismiss the case pursuant to a clause in the independent contractor agreement stating that Tennessee law applies.  Also on November 19, 2015, Plaintiffs filed a motion to remand the case back to state court, claiming that the federal court lacks jurisdiction over the case.  The court granted Plaintiffs’ motion to remand to the state court in San Bernardino County on April 7, 2016, mooting Defendants’ motions to transfer and dismiss.

On July 11, 2016, Defendants filed several motions in state court, asking the court to dismiss and/or stay the Plaintiffs’ suit for various reasons.  During a hearing on October 5, 2016, the judge issued an oral tentative ruling stating that the choice of forum provision was unenforceable.  On Defendants’ motion to dismiss the individual defendants, the court allowed for supplemental briefing for additional arguments regarding individual liability under PAGA.  The court did not reach a decision regarding the motion to stay pending the outcome in Robles.  Plaintiffs filed their supplemental brief on November 9, 2016 to which Defendants responded on December 6, 2016.  

On February 17, 2017, with the stipulation of the parties, the Court entered an Order dismissing, without prejudice, all of the individual Defendants and accepting the parties’ agreement that jurisdiction and venue are proper in the San Bernardino Superior Court and that Defendants will not seek to remove the case to federal district court.  On April 12, 2017, the Court denied Defendants’ motion to dismiss based on insufficiency of the PAGA letter notice.  On October 5, 2017, Plaintiffs served an amended complaint, in part dismissing the previously named individuals as Defendants.

Lubinski

On September 12, 2014, a complaint was filed in the U.S. District Court for the Northern District of Illinois (Eastern Division) by Christian Lubinski against Hub Group Trucking.  The action was brought on behalf of a class comprised of present and former owner-operators providing delivery services in Illinois for Hub Group Trucking.  The complaint alleged Hub Group Trucking misclassified such drivers as independent contractors and that such drivers were employees.  The complaint also alleged that Hub Group Trucking made illegal deductions from the drivers’ pay and failed to properly compensate the drivers for all hours worked, reimburse business expenses, pay employment taxes, and provide workers’ compensation and other employment benefits.  The complaint asserted various violations of the Illinois Wage Payment and Collections Act and claimed that Hub Group Trucking was unjustly enriched.  The complaint sought, among other things, monetary damages for the relevant statutory period and attorneys’ fees.  

On October 24, 2014, the Lubinski case was transferred to the U.S. District Court for the Western District of Tennessee (Western Division), in Memphis.  On September 22, 2015, the court granted Hub Group Trucking’s motion to dismiss Lubinski’s Illinois law claims with prejudice based on the contractual choice of law provision, which provided that Tennessee law governed.  The court denied as moot Hub Group Trucking’s motion to dismiss based on federal preemption.  On October 2, 2015, Lubinski appealed this order to the United States Court of Appeals for the Sixth Circuit in Cincinnati.

On December 17, 2015, Lubinski filed his brief in support of his appeal of the motion to dismiss, asserting for the first time that the federal court did not have jurisdiction over the case due to a lack of diversity of citizenship.  Hub Group Trucking filed its response brief on January 19, 2016, in part arguing that Lubinski had himself alleged diversity of citizenship in his complaint.  Lubinski filed his reply brief on February 5, 2016.  On April 1, 2016, the Sixth Circuit remanded the case to the district court—without ruling on the merits—for the district court “to consider the argument and admit the evidence necessary to determine the question of federal subject-matter jurisdiction.”  

On July 11, 2016, with his federal district court case still pending, Lubinski filed an additional putative class action Complaint, with the same claims, in Illinois state court.  On the same day, Hub Group Trucking filed a declaratory judgment complaint in Tennessee state court, seeking a declaration that Lubinski’s claims must be heard in Tennessee (based on the contractual choice-of-forum provision) and that the claims must be dismissed because Tennessee law controls and Lubinski’s claims are preempted by federal law.

On October 26, 2016, Lubinski filed a motion to dismiss for lack of federal subject-matter jurisdiction and a motion for leave to file an amended complaint, attempting to “clarify” the putative class definition and arguing that the Class Action Fairness Act’s exceptions to jurisdiction apply.    In early 2017, Plaintiff’s counsel advised Hub Group Trucking that Lubinski would no longer challenge federal jurisdiction.  On February 15, 2017, the District Court adopted the parties’ stipulation and found that there is federal subject-matter jurisdiction.  On March 22, 2017, the U.S. Court of Appeals for the Sixth Circuit granted Plaintiff’s motion to recall the mandate and reinstate Lubinski’s appeal of the district court’s order dismissing the case.  On June 8, 2017, the Sixth Circuit issued an Opinion affirming the District Court’s dismissal of Plantiff’s claims.  On June 30, 2017, the Sixth Circuit issued the Mandate in the case, which terminates the 6^th Circuit appeal proceedings.  Plaintiff had until September 6, 2017, to ask the U.S. Supreme Court to review the case.  Plaintiff did not file any petition with the Supreme Court, so the case is completed.

We cannot reasonably estimate at this time the possible loss or range of loss, if any, that may arise from the remaining unresolved claims in the above mentioned lawsuits.

We are a party to other litigation incident to our business, including claims for personal injury and/or property damage, bankruptcy preference claims, and claims regarding freight lost or damaged in transit, improperly shipped or improperly billed.  Some of the lawsuits to which we are party are covered by insurance and are being defended by our insurance carriers.  Some of the lawsuits are not covered by insurance and we defend those ourselves.  We do not believe that the outcome of this litigation will have a materially adverse effect on our financial position or results of operations.

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New Pronouncements

9 Months Ended

Sep. 30, 2017

Accounting Changes And Error Corrections [Abstract]

New Pronouncements

NOTE 9.New Pronouncements

In May 2014, the FASB issued Update No. 2014-09—Revenue from Contracts with Customers (Topic 606).  This Standard provides guidance on how to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The FASB has recently issued several amendments to the standard, including clarification on the accounting for principal vs agent and identifying performance obligations.  

The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). We currently anticipate adopting the standard using the full retrospective method to restate each prior reporting period presented, if material.  We will elect to record sales tax on a net basis.  We do not expect this election to have a material impact on our consolidated financial statements.

Early application is permitted for annual reporting periods beginning after December 15, 2016.  We plan to adopt this standard January 1, 2018, as required.  

While we are continuing to assess all potential impacts of the standard, other than additional disclosures, we do not anticipate that this standard will have a material impact on our consolidated financial statements.  We have identified and analyzed our revenue streams and continue to analyze our current and historical contracts.

In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases.  Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  The new standard will become effective beginning with the first quarter of 2019.  Early adoption of the standard is permitted.  We plan to adopt this standard January 1, 2019, as required.  We are currently evaluating the impacts the adoption of this accounting guidance will have on the consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification of related amounts within the statement of cash flows. The new standard became effective beginning with the first quarter of 2017.  We adopted ASU 2016-09 in the first quarter of 2017 and the adoption did not have a material impact on our consolidated financial statements.  We have applied the reclassification of excess tax benefits prospectively and therefore the prior period has not been adjusted.

In 2016, the FASB issued new guidance that requires credit losses on financial assets measured at amortized cost basis to be presented at the net amount expected to be collected, not based on incurred losses.  The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 is permitted. We are evaluating the impact of adopting this new accounting guidance on our consolidated financial statements.

In 2016, the FASB issued new guidance which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows, including debt prepayment or extinguishment costs, settlement of contingent consideration arising from a business combination, insurance settlement proceeds, and distributions from certain equity method investees. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. We are evaluating the impact of adopting this new accounting guidance on our consolidated financial statements.

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Income Taxes

9 Months Ended

Sep. 30, 2017

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 10.Income Taxes

The provision for income taxes is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items.  Our effective income tax rate was 22.5% and 32.2% for the three and nine months ended September 30, 2017, respectively, as compared to 38.4% for both the three and nine months ended September 30, 2016.  The lower tax rates for 2017 were driven primarily by the impact of domestic production activities deductions.

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Subsequent Events

9 Months Ended

Sep. 30, 2017

Subsequent Events [Abstract]

Subsequent Events

NOTE 11.Subsequent Events

In October 2017, we entered into various agreements to purchase 38 tractors and 45 trailers for a purchase price of approximately $6 million.  The equipment is expected to be delivered by the end of 2017.  We will be financing the purchase of this equipment with secured fixed rate debt.

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Acquisition (Tables)

9 Months Ended

Sep. 30, 2017

Preliminary Allocation of Total Consideration to Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary allocation of the total consideration to the assets acquired and liabilities assumed as of the date of the acquisition (in thousands):

	July 1, 2017
Cash and cash equivalents	$	12
Accounts receivable trade		27,000
Accounts receivable other		165
Prepaid expenses and other current assets		1,500
Property and equipment		128,477
Other intangibles		66,400
Goodwill		86,294
Other assets		64
Total assets acquired	$	309,912
Accounts payable trade	$	4,542
Accrued payroll		5,661
Accrued other		15,018
Equipment debt		112,677
Total liabilities assumed	$	137,898
Total consideration	$	172,014

Components of Other Intangibles Acquired

The components of “Other intangibles” listed in the above table as of the acquisition date are preliminarily estimated as follows (in thousands):

			Accumulated		Balance at		Estimated Useful
	Amount		Amortization		September 30, 2017		Life
Customer relationships	$	66,000	$	1,100	$	64,900	15 years
Trade name		400		400	-		3 months

Unaudited Pro forma Consolidated Results of Operations

The following unaudited pro forma consolidated results of operations for 2017 and 2016 assume that the acquisition of Estenson was completed as of January 1, 2016 (in thousands, except for per share amounts):

	Three Months
	Ended
	September 30, 2016
Revenue	$	988,345
Net income	$	20,249
Earnings per share
Basic	$	0.61
Diluted	$	0.61

	Nine Months		Nine Months
	Ended		Ended
	September 30, 2017		September 30, 2016
Revenue	$	2,986,342	$	2,752,660
Net income	$	39,387	$	62,212
Earnings per share
Basic	$	1.19	$	1.82
Diluted	$	1.18	$	1.82

Estenson Logistics, LLC [Member]

Summary of Total Purchase Price Allocated to Net Assets Acquired

The following table summarizes the total purchase price allocated to the net assets acquired (in thousands):

Cash paid	$	165,945
Consideration payable		1,366
Contingent consideration, fair value		4,703
Total consideration		172,014
Equipment debt assumed		112,677
Total base purchase price	$	284,691

Amortization Expense of Intangible Assets Acquired

Amortization expense related to HGD for the next five years is as follows (in thousands):

Remainder 2017	$	1,100
2018		4,400
2019		4,400
2020		4,400
2021		4,400

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Business Segments (Tables)

9 Months Ended

Sep. 30, 2017

Segment Reporting [Abstract]

Summary of Operating Results

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814
Transportation costs		734,747		228,227		(25,138	)		937,836		638,154		218,702		(35,496	)		821,360
Gross margin		86,055		30,469		-			116,524		78,545		32,909		-			111,454
Costs and expenses:
Salaries and benefits		45,727		3,399		-			49,126		38,775		3,835		-			42,610
Agent fees and commissions		15		19,057		-			19,072		20		19,052		-			19,072
General and administrative		20,520		1,883		-			22,403		15,969		1,672		-			17,641
Depreciation and amortization		3,962		292		-			4,254		1,959		317		-			2,276
Total costs and expenses		70,224		24,631		-			94,855		56,723		24,876		-			81,599
Operating income	$	15,831	$	5,838	$	-		$	21,669	$	21,822	$	8,033	$	-		$	29,855
Capital Expenditures	$	10,170	$	173	$	-		$	10,343	$	34,411	$	255	$	-		$	34,666

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230
Transportation costs		1,972,725		654,612		(74,442	)		2,552,895		1,739,676		598,809		(78,586	)		2,259,899
Gross margin		230,417		89,009		-			319,426		240,774		93,557		-			334,331
Costs and expenses:
Salaries and benefits		126,891		10,452		-			137,343		118,658		11,417		-			130,075
Agent fees and commissions		46		54,057		-			54,103		47		54,287		-			54,334
General and administrative		57,330		6,011		-			63,341		44,917		5,451		-			50,368
Depreciation and amortization		8,319		896		-			9,215		5,603		956		-			6,559
Total costs and expenses		192,586		71,416		-			264,002		169,225		72,111		-			241,336
Operating income	$	37,831	$	17,593	$	-		$	55,424	$	71,549	$	21,446	$	-		$	92,995
Capital Expenditures	$	39,732	$	204	$	-		$	39,936	$	59,356	$	527	$	-		$	59,883

Summary of Revenue by Segment and Business Line

The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended September 30:

	Three Months									Three Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	473,998	$	123,194	$	(13,665	)	$	583,527	$	466,283	$	126,052	$	(21,857	)	$	570,478
Truck brokerage		113,179		87,242		(634	)		199,787		96,906		79,627		(174	)		176,359
Logistics		175,679		48,260		(10,794	)		213,145		153,510		45,932		(13,465	)		185,977
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	820,802	$	258,696	$	(25,138	)	$	1,054,360	$	716,699	$	251,611	$	(35,496	)	$	932,814

The following tables summarize our revenue by segment and business line (in thousands) for the nine months ended September 30:

	Nine Months									Nine Months
	Ended September 30, 2017									Ended September 30, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Intermodal	$	1,350,187	$	357,516	$	(41,768	)	$	1,665,935	$	1,318,223	$	355,379	$	(61,974	)	$	1,611,628
Truck brokerage		324,823		248,311		(1,330	)		571,804		261,456		228,350		(676	)		489,130
Logistics		470,186		137,794		(31,299	)		576,681		400,771		108,637		(15,936	)		493,472
Dedicated		57,946		-		(45	)		57,901		-		-		-			-
Total revenue	$	2,203,142	$	743,621	$	(74,442	)	$	2,872,321	$	1,980,450	$	692,366	$	(78,586	)	$	2,594,230

Schedule of Assets

	As of September 30, 2017									As of December 31, 2016
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Total assets	$	1,421,628	$	184,996	$	(6,761	)	$	1,599,863	$	1,178,110	$	191,374	$	(9,225	)	$	1,360,259
Goodwill		319,117		29,389		-			348,506		232,987		29,389		-			262,376

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Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2017

Earnings Per Share [Abstract]

Reconciliation of Earnings Per Share

The following is a reconciliation of our earnings per share (in thousands, except for per share data):

	Three Months Ended, September 30,				Nine Months Ended, September 30,
	2017		2016		2017		2016
Net income for basic and diluted earnings per share	$	15,334	$	17,924	$	35,210	$	56,561
Weighted average shares outstanding - basic		33,227		33,212		33,217		34,098
Dilutive effect of  stock options and restricted stock		108		154		106		74
Weighted average shares outstanding - diluted		33,335		33,366		33,323		34,172
Earnings per share - basic	$	0.46	$	0.54	$	1.06	$	1.66
Earnings per share - diluted	$	0.46	$	0.54	$	1.06	$	1.66

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Long-Term Debt and Financing Arrangements (Tables)

9 Months Ended

Sep. 30, 2017

Debt Disclosure [Abstract]

Schedule of Outstanding Debt

In addition to borrowings under our new credit agreement, we have entered into various Equipment Notes (“Notes”) for the purchase of tractors and containers.  The Notes are secured by the underlying equipment financed in the agreements.

	Period Ended
	September 30,			December 31,
	2017			2016
	(in thousands except principal and interest payments)
Revolving line of credit	$	50,000		$	-
Secured Equipment Notes due on various dates in 2024 with monthly principal and interest payments between $403 and $83,000 commencing on various dates in 2017; interest is paid monthly at a fixed annual rate between 2.85% and 3.28%		12,388			-
Secured Equipment Notes due on various dates in 2023 with monthly principal and interest payments between $669 and $41,238 commencing on various dates in 2016 and 2017; interest is paid monthly at a fixed annual rate between 2.23% and 3.12%		11,554			-
Secured Equipment Notes due on various dates in  2022 with monthly principal and interest payments between $3,030 and $254,190 commencing on various dates from 2015 to 2017; interest is paid monthly at a fixed annual rate of between 2.16% and 2.87%		32,517			-
Secured Equipment Notes due on various dates in 2021 with monthly principal and interest payments between $1,940 and $326,333 commencing on various dates from 2014 to 2017; interest is paid monthly at a fixed annual rate between 2.04% and 2.96%		81,176			59,836
Secured Equipment Notes due on various dates in 2020 with monthly principal and interest payments between $6,175 and $398,496 commencing on various dates from 2013 to 2016; interest is paid monthly at a fixed annual rate between 1.72% and 2.78%		57,305			48,633
Secured Equipment Notes due on various dates in 2019 with monthly principal and interest payments between $1,594 and $444,000 commencing on various dates from 2013 to 2015; interest is paid monthly at a fixed annual rate between 1.87% and 2.62%		40,803			49,464
Secured Equipment Notes due in June 2018 with monthly or quarterly principal and interest payments between $542 and $480,000 commencing on various dates from 2012 to 2014; interest is paid quarterly at a fixed annual rate between 1.89% and 4.45%		1,280			2,759
Secured Equipment Notes due on various dates in 2017 with monthly principal and interest payments between $12,964 and $19,792 commencing on various dates in 2012 and 2013; interest is paid monthly at a fixed annual rate between 2.06% and 2.11%		61			-
		287,084			160,692
Less current portion		(73,052	)		(45,163	)
Total long-term debt	$	214,032		$	115,529

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Acquisition - Additional Information (Detail) $ in Thousands		3 Months Ended	9 Months Ended
	Jul. 01, 2017 USD ($) Tractor Trailer	Sep. 30, 2017 USD ($)	Sep. 30, 2017 USD ($)
Hub Group Dedicated [Member]
Business Acquisition [Line Items]
Number of tractors in operating fleet | Tractor	1,000
Number of trailers in operating fleet | Trailer	3,600
Estenson Logistics, LLC [Member]
Business Acquisition [Line Items]
Business acquisition date			Jul. 01, 2017
Business acquisition, purchase price	$ 284,691
Contingent consideration related to an earn-out provision	6,000
Business acquisition, final consideration	172,014
Business acquisition, debt assumed	112,677
Business acquisition, cash paid	165,945
Amount of cash borrowed under new line of credit	$ 55,000
Business acquisition costs			$ 1,600
Amortization expense of intangible assets		$ 1,500	$ 1,500
Intangible assets, weighted average useful life			15 years

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Summary of Total Purchase Price Allocated to Net Assets Acquired (Detail) - Estenson Logistics, LLC [Member] $ in Thousands	Jul. 01, 2017 USD ($)
Business Acquisition [Line Items]
Cash paid	$ 165,945
Consideration payable	1,366
Contingent consideration, fair value	4,703
Total consideration	172,014
Equipment debt assumed	112,677
Total base purchase price	$ 284,691

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Summary of Preliminary Allocation of Total Purchase Price to Assets and Liabilities (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Jul. 01, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Goodwill	$ 348,506		$ 262,376
Estenson Logistics, LLC [Member]
Business Acquisition [Line Items]
Cash and cash equivalents		$ 12
Accounts receivable trade		27,000
Accounts receivable other		165
Prepaid expenses and other current assets		1,500
Property and equipment		128,477
Other intangibles		66,400
Goodwill		86,294
Other assets		64
Total assets acquired		309,912
Accounts payable trade		4,542
Accrued payroll		5,661
Accrued other		15,018
Equipment debt assumed		112,677
Total liabilities assumed		137,898
Total consideration		$ 172,014

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Components of Other Intangible Assets (Detail) - Estenson Logistics, LLC [Member] $ in Thousands	9 Months Ended
	Sep. 30, 2017 USD ($)
Customer Relationships [Member]
Other Intangible Assets [Line Items]
Finite-lived intangible assets, Amount	$ 66,000
Finite-lived intangible assets, Accumulated Amortization	1,100
Finite-lived intangible assets, Balance at September 30, 2017	$ 64,900
Intangible assets estimated useful life	15 years
Trade Name [Member]
Other Intangible Assets [Line Items]
Finite-lived intangible assets, Amount	$ 400
Finite-lived intangible assets, Accumulated Amortization	$ 400
Intangible assets estimated useful life	3 months

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Amortization Expense of Intangible Assets (Detail) - Hub Group Dedicated [Member] $ in Thousands	Sep. 30, 2017 USD ($)
Finite Lived Intangible Assets [Line Items]
Remainder 2017	$ 1,100
2018	4,400
2019	4,400
2020	4,400
2021	$ 4,400

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Unaudited Pro forma Consolidated Results of Operations (Detail) - Estenson Logistics, LLC [Member] - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Business Acquisition [Line Items]
Revenue	$ 988,345	$ 2,986,342	$ 2,752,660
Net income	$ 20,249	$ 39,387	$ 62,212
Earnings per share
Basic	$ 0.61	$ 1.19	$ 1.82
Diluted	$ 0.61	$ 1.18	$ 1.82

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Business Segments - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2017 Segment
Segment Reporting Information [Line Items]
Reporting business segments	2
Number of railheads	one or more
Mode LLC [Member]
Segment Reporting Information [Line Items]
Business acquisition, date	Apr. 01, 2011

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Summary of Operating Results (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Segment Reporting Information [Line Items]
Revenue	$ 1,054,360	$ 932,814	$ 2,872,321	$ 2,594,230
Transportation costs	937,836	821,360	2,552,895	2,259,899
Gross margin	116,524	111,454	319,426	334,331
Costs and expenses:
Salaries and benefits	49,126	42,610	137,343	130,075
Agent fees and commissions	19,072	19,072	54,103	54,334
General and administrative	22,403	17,641	63,341	50,368
Depreciation and amortization	4,254	2,276	9,215	6,559
Total costs and expenses	94,855	81,599	264,002	241,336
Operating income	21,669	29,855	55,424	92,995
Capital Expenditures	10,343	34,666	39,936	59,883
Operating Segments [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	820,802	716,699	2,203,142	1,980,450
Transportation costs	734,747	638,154	1,972,725	1,739,676
Gross margin	86,055	78,545	230,417	240,774
Costs and expenses:
Salaries and benefits	45,727	38,775	126,891	118,658
Agent fees and commissions	15	20	46	47
General and administrative	20,520	15,969	57,330	44,917
Depreciation and amortization	3,962	1,959	8,319	5,603
Total costs and expenses	70,224	56,723	192,586	169,225
Operating income	15,831	21,822	37,831	71,549
Capital Expenditures	10,170	34,411	39,732	59,356
Operating Segments [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Revenue	258,696	251,611	743,621	692,366
Transportation costs	228,227	218,702	654,612	598,809
Gross margin	30,469	32,909	89,009	93,557
Costs and expenses:
Salaries and benefits	3,399	3,835	10,452	11,417
Agent fees and commissions	19,057	19,052	54,057	54,287
General and administrative	1,883	1,672	6,011	5,451
Depreciation and amortization	292	317	896	956
Total costs and expenses	24,631	24,876	71,416	72,111
Operating income	5,838	8,033	17,593	21,446
Capital Expenditures	173	255	204	527
Intersegment Elims [Member]
Segment Reporting Information [Line Items]
Revenue	(25,138)	(35,496)	(74,442)	(78,586)
Transportation costs	$ (25,138)	$ (35,496)	$ (74,442)	$ (78,586)

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Summary of Revenue by Segment and Business Line (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Segment Reporting Information [Line Items]
Revenue	$ 1,054,360	$ 932,814	$ 2,872,321	$ 2,594,230
Intermodal [Member]
Segment Reporting Information [Line Items]
Revenue	583,527	570,478	1,665,935	1,611,628
Truck brokerage [Member]
Segment Reporting Information [Line Items]
Revenue	199,787	176,359	571,804	489,130
Logistics [Member]
Segment Reporting Information [Line Items]
Revenue	213,145	185,977	576,681	493,472
Dedicated [Member]
Segment Reporting Information [Line Items]
Revenue	57,901		57,901
Operating Segments [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	820,802	716,699	2,203,142	1,980,450
Operating Segments [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Revenue	258,696	251,611	743,621	692,366
Operating Segments [Member] | Intermodal [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	473,998	466,283	1,350,187	1,318,223
Operating Segments [Member] | Intermodal [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Revenue	123,194	126,052	357,516	355,379
Operating Segments [Member] | Truck brokerage [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	113,179	96,906	324,823	261,456
Operating Segments [Member] | Truck brokerage [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Revenue	87,242	79,627	248,311	228,350
Operating Segments [Member] | Logistics [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	175,679	153,510	470,186	400,771
Operating Segments [Member] | Logistics [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Revenue	48,260	45,932	137,794	108,637
Operating Segments [Member] | Dedicated [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Revenue	57,946		57,946
Intersegment Elims [Member]
Segment Reporting Information [Line Items]
Revenue	(25,138)	(35,496)	(74,442)	(78,586)
Intersegment Elims [Member] | Intermodal [Member]
Segment Reporting Information [Line Items]
Revenue	(13,665)	(21,857)	(41,768)	(61,974)
Intersegment Elims [Member] | Truck brokerage [Member]
Segment Reporting Information [Line Items]
Revenue	(634)	(174)	(1,330)	(676)
Intersegment Elims [Member] | Logistics [Member]
Segment Reporting Information [Line Items]
Revenue	(10,794)	$ (13,465)	(31,299)	$ (15,936)
Intersegment Elims [Member] | Dedicated [Member]
Segment Reporting Information [Line Items]
Revenue	$ (45)		$ (45)

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Schedule of Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Total assets	$ 1,599,863	$ 1,360,259
Goodwill	348,506	262,376
Operating Segments [Member] | Hub [Member]
Segment Reporting Information [Line Items]
Total assets	1,421,628	1,178,110
Goodwill	319,117	232,987
Operating Segments [Member] | Mode LLC [Member]
Segment Reporting Information [Line Items]
Total assets	184,996	191,374
Goodwill	29,389	29,389
Intersegment Elims [Member]
Segment Reporting Information [Line Items]
Total assets	$ (6,761)	$ (9,225)

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Reconciliation of Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Earnings Per Share [Abstract]
Net income for basic and diluted earnings per share	$ 15,334	$ 17,924	$ 35,210	$ 56,561
Weighted average shares outstanding - basic	33,227	33,212	33,217	34,098
Dilutive effect of stock options and restricted stock	108	154	106	74
Weighted average shares outstanding - diluted	33,335	33,366	33,323	34,172
Earnings per share - basic	$ 0.46	$ 0.54	$ 1.06	$ 1.66
Earnings per share - diluted	$ 0.46	$ 0.54	$ 1.06	$ 1.66

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Fair Value Measurement - Additional Information (Detail) - USD ($) $ in Millions	Sep. 30, 2017	Dec. 31, 2016
Fair Value Disclosures [Abstract]
Restricted investments	$ 24.1	$ 20.9

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Long-Term Debt and Financing Arrangements - Additional Information (Detail) - USD ($)		3 Months Ended	9 Months Ended
	Jul. 01, 2017	Sep. 30, 2017	Sep. 30, 2017	Dec. 31, 2016
Credit Agreement [Member]
Line Of Credit Facility [Line Items]
Amount of credit agreement	$ 350,000,000
Unused and available borrowings under credit agreement		$ 286,500,000	$ 286,500,000
Credit agreement interest rate description			(i) LIBOR plus a specified margin based upon the Borrowers' total net leverage ratio (as defined in the Credit Agreement) (the "Total Net Leverage Ratio"), or (ii) the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50% or (c) the sum of 1% plus one-month LIBOR) plus a specified margin based upon the Total Net Leverage Ratio.
Commitment fee on unused commitments	0.25%
Credit Agreement covenant terms			The Credit Agreement contains various restrictions and covenants, including negative covenants that limit or restrict dividends, indebtedness of subsidiaries, mergers and fundamental changes, asset sales, acquisitions, liens and encumbrances, transactions with affiliates, changes in fiscal year and other matters customarily restricted in such agreements. The Company must maintain a Total Net Leverage Ratio of (a) total funded debt as of such date, minus up to $50,000,000 in unrestricted cash and cash equivalents (each as defined in the Credit Agreement) to (b) consolidated EBITDA (as defined in the credit agreement) of not more than 3.00 to 1.00; provided that as of the close of each of the four fiscal quarters occurring after the consummation of a permitted acquisition (as defined in the Credit Agreement) with an aggregate consideration of $150,000,000 or more, such ratio shall not be more than 3.25 to 1.00. The Company must maintain an interest coverage ratio of consolidated EBITDA to consolidated cash interest expense of not less than 3.00 to 1.00. We incurred $1.4 million of financing costs related to the Credit Agreement during the third quarter of 2017, which we capitalized and will amortize to interest expense over the term of the agreement. The unamortized balance of $1.3 million is included in Other assets in the Unaudited Consolidated Balance Sheet as of September 30, 2017.
Debt covenant permitted aggregate consideration	$ 150,000,000
Financing costs related to the credit agreement		1,400,000
Credit Agreement [Member] | Other Assets [Member]
Line Of Credit Facility [Line Items]
Unamortized balance		1,300,000	$ 1,300,000
Credit Agreement [Member] | Maximum [Member]
Line Of Credit Facility [Line Items]
Restricted cash and cash equivalents	$ 50,000,000
Total leverage ratio	3.00%
Total leverage ratio for following four each fiscal quarters	3.25%
Credit Agreement [Member] | Minimum [Member]
Line Of Credit Facility [Line Items]
Interest coverage ratio	3.00%
Credit Agreement [Member] | Federal Funds Rate [Member]
Line Of Credit Facility [Line Items]
Interest rate under the credit agreement	0.50%
Credit Agreement [Member] | LIBOR rate [Member]
Line Of Credit Facility [Line Items]
Interest rate under the credit agreement	1.00%
Description of variable rate basis	one-month LIBOR
Credit Agreement [Member] | Eurodollar
Line Of Credit Facility [Line Items]
Interest rate under the credit agreement	2.00%
Credit Agreement [Member] | Base Rate
Line Of Credit Facility [Line Items]
Interest rate under the credit agreement	1.00%
2013 Credit Agreement [Member]
Line Of Credit Facility [Line Items]
Unused and available borrowings under credit agreement				$ 38,200,000
Letter of Credit
Line Of Credit Facility [Line Items]
Commitment fee on unused commitments	2.00%
Standby Letters of Credit [Member]
Line Of Credit Facility [Line Items]
Letters of credit expiration year			2017
Outstanding letters of credit		$ 13,500,000	$ 13,500,000

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Schedule of Outstanding Debt (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Debt Instrument [Line Items]
Revolving line of credit & Secured long-term debt	$ 287,084	$ 160,692
Less current portion	(73,052)	(45,163)
Total long-term debt	214,032	115,529
Revolving Line of Credit [Member]
Debt Instrument [Line Items]
Revolving line of credit	50,000
Secured Equipment Notes due in 2024 [Member]
Debt Instrument [Line Items]
Secured long-term debt	12,388
Secured Equipment Notes due in 2023 [Member]
Debt Instrument [Line Items]
Secured long-term debt	11,554
Secured Equipment Notes due in 2022 [Member]
Debt Instrument [Line Items]
Secured long-term debt	32,517
Secured Equipment Notes due in 2021 [Member]
Debt Instrument [Line Items]
Secured long-term debt	81,176	59,836
Secured Equipment Notes due in 2020 [Member]
Debt Instrument [Line Items]
Secured long-term debt	57,305	48,633
Secured Equipment Notes due in 2019 [Member]
Debt Instrument [Line Items]
Secured long-term debt	40,803	49,464
Secured Equipment Notes due in June 2018 [Member]
Debt Instrument [Line Items]
Secured long-term debt	1,280	$ 2,759
Secured Equipment Notes due in 2017 [Member]
Debt Instrument [Line Items]
Secured long-term debt	$ 61

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Schedule of Outstanding Debt (Parenthetical) (Detail)	9 Months Ended
	Sep. 30, 2017 USD ($)
Secured Equipment Notes due in 2024 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2024
Payment Frequency	monthly
Secured Equipment Notes due in 2024 [Member] | Commencing on 2017 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2017
Secured Equipment Notes due in 2023 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2023
Payment Frequency	monthly
Secured Equipment Notes due in 2023 [Member] | Commencing on 2017 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2017
Secured Equipment Notes due in 2023 [Member] | Commencing on 2016 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2016
Secured Equipment Notes due in 2022 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2022
Payment Frequency	monthly
Secured Equipment Notes due in 2022 [Member] | Commencing on 2017 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2017
Secured Equipment Notes due in 2022 [Member] | Commencing on 2015 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2015
Secured Equipment Notes due in 2021 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2021
Payment Frequency	monthly
Secured Equipment Notes due in 2021 [Member] | Commencing on 2017 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2017
Secured Equipment Notes due in 2021 [Member] | Commencing on 2014 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2014
Secured Equipment Notes due in 2020 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2020
Payment Frequency	monthly
Secured Equipment Notes due in 2020 [Member] | Commencing on 2016 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2016
Secured Equipment Notes due in 2020 [Member] | Commencing on 2013 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2013
Secured Equipment Notes due in 2019 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2019
Payment Frequency	monthly
Secured Equipment Notes due in 2019 [Member] | Commencing on 2015 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2015
Secured Equipment Notes due in 2019 [Member] | Commencing on 2013 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2013
Secured Equipment Notes due in June 2018 [Member]
Debt Instrument [Line Items]
Payment Frequency	quarterly
Equipment notes due	Jun. 30, 2018
Secured Equipment Notes due in June 2018 [Member] | Commencing on 2012 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2012
Secured Equipment Notes due in June 2018 [Member] | Commencing on 2014 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2014
Secured Equipment Notes due in 2017 [Member]
Debt Instrument [Line Items]
Equipment notes due period	2017
Payment Frequency	monthly
Secured Equipment Notes due in 2017 [Member] | Commencing on 2012 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2012
Secured Equipment Notes due in 2017 [Member] | Commencing on 2013 [Member]
Debt Instrument [Line Items]
Equipment notes, date of first required payment	2013
Minimum [Member] | Secured Equipment Notes due in 2024 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 403
Interest rate secured debt	2.85%
Minimum [Member] | Secured Equipment Notes due in 2023 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 669
Interest rate secured debt	2.23%
Minimum [Member] | Secured Equipment Notes due in 2022 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 3,030
Interest rate secured debt	2.16%
Minimum [Member] | Secured Equipment Notes due in 2021 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 1,940
Interest rate secured debt	2.04%
Minimum [Member] | Secured Equipment Notes due in 2020 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 6,175
Interest rate secured debt	1.72%
Minimum [Member] | Secured Equipment Notes due in 2019 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 1,594
Interest rate secured debt	1.87%
Minimum [Member] | Secured Equipment Notes due in June 2018 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 542
Interest rate secured debt	1.89%
Minimum [Member] | Secured Equipment Notes due in 2017 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 12,964
Interest rate secured debt	2.06%
Maximum [Member] | Secured Equipment Notes due in 2024 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 83,000
Interest rate secured debt	3.28%
Maximum [Member] | Secured Equipment Notes due in 2023 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 41,238
Interest rate secured debt	3.12%
Maximum [Member] | Secured Equipment Notes due in 2022 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 254,190
Interest rate secured debt	2.87%
Maximum [Member] | Secured Equipment Notes due in 2021 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 326,333
Interest rate secured debt	2.96%
Maximum [Member] | Secured Equipment Notes due in 2020 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 398,496
Interest rate secured debt	2.78%
Maximum [Member] | Secured Equipment Notes due in 2019 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 444,000
Interest rate secured debt	2.62%
Maximum [Member] | Secured Equipment Notes due in June 2018 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 480,000
Interest rate secured debt	4.45%
Maximum [Member] | Secured Equipment Notes due in 2017 [Member]
Debt Instrument [Line Items]
Monthly payments	$ 19,792
Interest rate secured debt	2.11%

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Commitments and Contingencies - Additional Information (Detail) $ in Millions	1 Months Ended		9 Months Ended
	Oct. 31, 2017 Tractor	Nov. 30, 2016 USD ($) Container	Sep. 30, 2017 USD ($) Tractor Container	Oct. 21, 2017 Container
Loss Contingencies [Line Items]
Purchase contract units, containers		4,000
Cost of purchasing containers | $		$ 40
Number of containers expected to be receive in remainder of fiscal year			394
Number of containers expected to be receive in year two			1,450
Purchase contract units tractors | Tractor			154
Cost of purchasing tractors | $			$ 18
Subsequent Event [Member]
Loss Contingencies [Line Items]
Number of containers received				2,156
Purchase contract units tractors | Tractor	38

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Legal Matters - Additional Information (Detail) - Robles Lawsuits [Member]		1 Months Ended	9 Months Ended
	Aug. 05, 2015 Plaintiff Employee	May 31, 2015 Plaintiff	Sep. 30, 2017
Loss Contingencies [Line Items]
Percentage of California drivers who accepted settlement offers			93.00%
Number of plaintiffs		2
Number of plaintiffs against Hub Group Trucking	63
Number of employees filed lawsuit | Employee	5
Number of claims accepted settlement offers	58

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Income Taxes - Additional Information (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Income Tax Disclosure [Abstract]
Effective income tax rate	22.50%	38.40%	32.20%	38.40%

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Subsequent Events - Additional Information (Detail) $ in Millions	1 Months Ended	9 Months Ended
	Oct. 31, 2017 USD ($) Tractor Trailer	Sep. 30, 2017 Tractor
Subsequent Event [Line Items]
Purchase contract units tractors		154
Subsequent Event [Member]
Subsequent Event [Line Items]
Purchase contract units tractors	38
Purchase contract units trailers | Trailer	45
Cost of purchasing equipment | $	$ 6