Expeditors International of Washington, Inc. reported third‑quarter 2025 results that included a diluted earnings per share of $1.64, beating the consensus estimate of $1.40 by $0.24. The earnings beat was driven by strong performance in airfreight and customs‑brokerage services, which offset a sharp decline in ocean‑freight revenue.
Revenue for the quarter fell 4% year‑over‑year to $2.89 billion, largely because ocean‑freight revenue dropped 26.7% to $746 million. The decline reflects pricing pressure and excess capacity in the ocean‑freight market, as carriers compete on rates rather than cost. In contrast, airfreight revenue grew 3.4% to $1.00 billion, supported by a 4% increase in tonnage and robust demand for high‑value, time‑critical shipments.
Operating income decreased 4% to $288 million, mirroring the revenue decline. Despite the drop in ocean‑freight revenue, operating margins remained relatively stable because the company maintained pricing power in its fee‑based services and disciplined its cost structure. Net earnings attributable to shareholders fell 3% to $222 million, consistent with the operating‑income trend.
Sequentially, the company’s Q3 2025 revenue of $2.89 billion represents a 7% quarter‑over‑quarter improvement over Q2 2025 revenue of $2.70 billion, even as the year‑over‑year trend remains negative. EPS also remained flat year‑over‑year, rising from $1.63 in Q3 2024 to $1.64 in Q3 2025, while Q2 2025 EPS was $1.34.
Management highlighted that the company’s focus on fee‑based services and cost alignment is helping it navigate a lower‑growth environment. The firm is also investing in technology and AI infrastructure to enhance operational efficiency and customer experience. While the company did not provide forward guidance, the mix shift toward higher‑margin airfreight and customs‑brokerage services signals confidence in maintaining profitability amid market headwinds.
Headwinds for the quarter include ongoing pricing volatility in ocean freight, geopolitical dynamics affecting trade flows, and capacity constraints that limit rate recovery. Tailwinds are driven by sustained demand for airfreight, growth in customs‑brokerage services, and strategic investments in technology that position the company to capture future opportunities.
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