Industry Overview - The Zacks Transportation-Services industry is currently facing challenges such as weak freight rates, high inflation, and ongoing supply-chain disruptions [1][3][4] - Tariff-related uncertainty is another significant challenge impacting the industry [1][5] - Companies like Expeditors International of Washington, C.H. Robinson Worldwide, and Matson are noted for their ability to navigate these challenges [1] Economic Impact - The health of companies in the Zacks Transportation-Services industry is directly linked to the overall economy, with improvements in manufactured and retail goods positively affecting industry participants [2] - The Cass Freight Shipments Index has declined by 5.3% year over year in March, indicating weak freight demand [3] Cost Management - Industry players are focusing on cost-cutting measures to improve productivity and efficiency in response to high inflation and weaker demand [4] - Significant inflation levels are affecting labor, freight, and fuel costs [4] Tariff and Trade Issues - The current U.S. administration's protectionist policies are leading to increased tariffs, particularly affecting major trading partners like Canada, Mexico, and China [5] - The ongoing trade tensions are expected to result in increased volatility and uncertainty for the industry [5] Industry Performance - The Zacks Transportation-Services industry ranks 195 out of 250 Zacks industries, placing it in the bottom 21% [6][7] - The industry's earnings estimate for 2025 has decreased by 21.6% since August 2024, indicating a negative earnings outlook [8] Stock Market Performance - The industry has underperformed the S&P 500, declining by 14.5% over the past year compared to the S&P 500's appreciation of 9.9% [11] - The industry is currently trading at a forward price-to-sales ratio of 1.46X, compared to the S&P 500's 4.92X [13] Company Highlights - **Expeditors International of Washington (EXPD)**: Currently holds a Zacks Rank 3 (Hold), has beaten earnings estimates in three of the last four quarters with an average beat of 11.6% [17] - **C.H. Robinson Worldwide (CHRW)**: Also holds a Zacks Rank 3, has surpassed earnings estimates in each of the past four quarters with an average beat of 14.5% [21] - **Matson (MATX)**: Carries a Zacks Rank 3, has a trailing four-quarter earnings surprise of 12.7% on average [24]

Financial Performance - Total revenues for Q1 2025 were $4,046,740, a decrease of 8.3% from $4,412,311 in Q1 2024[13] - Net income for Q1 2025 increased to $135,302, up 45.5% from $92,904 in Q1 2024[13] - Basic net income per share rose to $1.12 in Q1 2025, compared to $0.78 in Q1 2024, reflecting a 43.6% increase[13] - The company reported a comprehensive income of $145,737 for Q1 2025, significantly higher than $73,414 in Q1 2024[13] - Revenues from external customers in the NAST segment were $2,868,420 in Q1 2025, down from $3,000,313 in Q1 2024, representing a decline of 4.4%[71] - Segment operating income for Q1 2025 was $186,614, compared to $140,447 in Q1 2024, reflecting an increase of 32.8%[69] Assets and Liabilities - Total current assets decreased to $2,923,725 as of March 31, 2025, down from $2,969,603 at the end of 2024, a decline of 1.5%[11] - Total liabilities decreased to $3,491,389 as of March 31, 2025, down from $3,575,875 at the end of 2024, a reduction of 2.4%[11] - Cash and cash equivalents at the end of Q1 2025 were $129,942, down from $145,762 at the end of 2024, a decrease of 10.9%[11] - As of March 31, 2025, total debt amounted to $1,389.9 million, an increase from $1,377.6 million as of December 31, 2024[37] - Goodwill balance as of March 31, 2025, was $1,432.1 million, down from $1,457.6 million as of December 31, 2024, primarily due to the divestiture[27] - Identifiable intangible assets totaled $80.2 million as of March 31, 2025, down from $86.9 million as of December 31, 2024[29] Cash Flow and Dividends - Operating cash flow for Q1 2025 was $106,531, compared to a cash outflow of $33,323 in Q1 2024[18] - The company declared dividends of $0.62 per share in Q1 2025, totaling $74,418[15] - The company repurchased 485 shares of common stock for a total cost of $48,722 during Q1 2025[15] Restructuring and Impairments - The company initiated a restructuring program in 2024 aimed at reducing costs and optimizing management hierarchy, which included workforce reductions[83] - The company reported a significant impairment charge of $6.3 million related to its Kansas City regional center lease in Q1 2025[77] - Accrued restructuring reserves were $1.5 million as of March 31, 2025, down from $4.0 million as of December 31, 2024[85] - The company paid $2.5 million in cash during Q1 2025 related to the 2024 Restructuring Program, with total restructuring charges amounting to $12.9 million for the three months ended March 31, 2024[85] Divestitures - The Company completed the sale of its Europe Surface Transportation business on February 1, 2025, resulting in a $44.5 million loss recorded in the twelve months ended December 31, 2024[33] - A pre-tax loss of $44.5 million was recognized in 2024 from the divestiture of the Europe Surface Transportation business, which included a $32.8 million loss on the disposal group classified as held for sale[89] - The sale of the Europe Surface Transportation business closed on February 1, 2025, with $27.7 million received at closing and additional consideration due in installments[90] - An additional pre-tax loss of $2.4 million was recognized in Q1 2025 related to the Europe Surface Transportation divestiture[90] - The company reported personnel expenses of $1.2 million and other selling, general, and administrative expenses of $1.2 million related to the Europe Surface Transportation divestiture in Q1 2025[91] Credit Facilities and Interest Rates - The Company has a senior unsecured revolving credit facility with a total availability of $1 billion, maturing on November 19, 2027[38] - The average interest rate for the revolving credit facility as of March 31, 2025, was 5.55%, slightly down from 5.58% as of December 31, 2024[37] - The Company recorded $467.9 million in receivables securitization facility debt as of March 31, 2025, compared to $446.8 million as of December 31, 2024[37] - The Receivables Securitization Facility has a total availability of $500 million as of March 31, 2025, with an interest rate based on SOFR plus a credit spread adjustment of 0.90 percent[44] - The Receivables Securitization Facility was amended on November 7, 2023, extending the termination date to November 7, 2025, while maintaining the total available amount of $500 million[47] Tax and Compensation - The effective income tax rate for the three months ended March 31, 2025, was 13.7%, down from 15.8% in the same period of 2024[53] - Total stock-based compensation expense for the three months ended March 31, 2025, was $23.1 million, compared to $22.7 million in 2024[55] - As of March 31, 2025, there was unrecognized compensation expense of $220.3 million related to previously granted stock awards assuming maximum achievement on PSUs[62] - The company has $23.9 million of unrecognized tax benefits and expects this liability to decrease by approximately $1.1 million in the next 12 months due to the lapsing of statutes of limitations[54] Workforce and Employee Metrics - The average employee headcount increased to 13,347 in Q1 2025 from 14,990 in Q1 2024, indicating a reduction in workforce[70] - Operating lease expense for Q1 2025 was $27,885, up from $25,637 in Q1 2024, marking an increase of 8.8%[77] - The allowance for credit losses on accounts receivable decreased to $12,666 as of March 31, 2025, from $14,038 at the end of 2024, a reduction of 9.7%[79] - Other comprehensive income for Q1 2025 was $10.4 million, compared to a loss of $19.5 million in Q1 2024, indicating a significant improvement[81] Market Risk - There were no material changes in market risk as of March 31, 2025, compared to disclosures in the company's 2024 Annual Report[148]

Core Viewpoint - C.H. Robinson Worldwide, Inc. (CHRW) reported mixed first-quarter 2025 results, with earnings exceeding expectations while revenues fell short [1] Financial Performance - Quarterly earnings per share (EPS) of $1.17 surpassed the Zacks Consensus Estimate of $1.02, reflecting a 36% year-over-year improvement [2] - Total revenues amounted to $4.04 billion, missing the Zacks Consensus Estimate of $4.31 billion, and decreased by 8.2% year over year due to the divestiture of the Europe Surface Transportation business, lower volume in North America truckload services, and reduced pricing in ocean services [2] - Adjusted gross profits increased by 2.3% year over year to $673.1 million, attributed to higher adjusted gross profit per transaction in truckload and LTL services [3] - The adjusted operating margin improved to 26.3%, up 700 basis points from the previous year, while operating expenses decreased by 6.5% year over year to $496.2 million [3] Segmental Results - North American Surface Transportation generated total revenues of $2.86 billion, down 4.4% year over year, due to lower truckload volume and market demand for freight, with adjusted gross profits growing 5.3% year over year to $418.32 million [4] - Global Forwarding revenues fell by 9.8% year over year to $774.88 million, primarily due to lower pricing in ocean services, with adjusted gross profits increasing by 2.5% year over year to $184.62 million [5] - Revenues from other sources decreased by 27.1% year over year to $403.43 million [5] - The transportation unit delivered an adjusted gross profit of $640.54 million, up 2.1% from the prior year [6] Profitability by Service Line - Adjusted gross profits for Truckload, LTL, Ocean, Air, and Customs grew by 1.9%, 5.2%, 2.2%, 7.5%, and 3.2% year over year, respectively, while other logistics services saw an 8% decline in adjusted gross profits [7] Cash Flow and Capital Expenditures - CHRW generated $106.5 million in cash from operations in the first quarter, compared to $33.3 million used in the prior-year quarter, driven by a $42.4 million increase in net income and a $136.8 million decrease in cash used by changes in net operating working capital [9] - The company returned $175 million to shareholders, including $77.5 million in cash dividends and $97.5 million through share repurchases [9] - Capital expenditures totaled $16.1 million in the reported quarter, with expectations for 2025 now between $65 million and $75 million, down from a prior range of $75-$85 million [10][11] Balance Sheet - At the end of the first quarter, CHRW had cash and cash equivalents of $129.94 million, down from $145.76 million at the end of the previous quarter, while long-term debt slightly increased to $922.08 million [8]

Group 1 - C.H. Robinson Worldwide (NASDAQ: CHRW) has shown strong performance over the past year, with shares increasing by approximately 25% [1] - In contrast, other logistics companies, such as J.B. Hunt (JBHT), have faced significant struggles during the same period [1] - The article highlights the author's experience in making contrarian bets based on macro views and stock-specific turnaround stories to achieve outsized returns with a favorable risk/reward profile [1]

For the quarter ended March 2025, C.H. Robinson Worldwide (CHRW) reported revenue of $4.05 billion, down 8.3% over the same period last year. EPS came in at $1.17, compared to $0.86 in the year-ago quarter.The reported revenue represents a surprise of -6.21% over the Zacks Consensus Estimate of $4.31 billion. With the consensus EPS estimate being $1.02, the EPS surprise was +14.71%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wal ...

C.H. Robinson Worldwide (CHRW) came out with quarterly earnings of $1.17 per share, beating the Zacks Consensus Estimate of $1.02 per share. This compares to earnings of $0.86 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 14.71%. A quarter ago, it was expected that this trucking company would post earnings of $1.12 per share when it actually produced earnings of $1.21, delivering a surprise of 8.04%.Over the last four quarte ...

C. H. Robinson Worldwide (CHRW) Q1 2025 Earnings Call April 30, 2025 05:00 PM ET Company Participants Chuck Ives - Senior Director of Investor RelationsDave Bozeman - President & CEOMichael Castagnetto - President of North American Surface TransportationArun Rajan - Chief Strategy & Innovation OfficerDamon Lee - Chief Financial OfficerJeff Kauffman - Partner, Transportation & Logistics Equity ResearchKenneth Hoexter - Managing Director Conference Call Participants Alex Johnson - Equity AnalystBrian Ossenbec ...

Financial Data and Key Metrics Changes - The company reported a 39% year-over-year increase in income from operations for Q1 [6] - Total operating expenses declined by $34 million or 6.5% year-over-year [27] - Average headcount in Q1 was down 11% compared to Q1 of last year [27] - The effective tax rate for the quarter was 13.7%, with an expected full-year rate of 18% to 20% [29] Business Line Data and Key Metrics Changes - In North American Surface Transportation (NAST), truckload volume was down 4.5% year-over-year but up 3.5% sequentially, while LTL volume grew 1% year-over-year and 1.5% sequentially [13] - NAST gross margin improved by 140 basis points year-over-year [15] - Global Forwarding saw a decline in ocean bookings out of China due to customers reducing purchases to mitigate tariff exposure [7][9] Market Data and Key Metrics Changes - The Q1 CAS freight shipment index was down 6.3% year-over-year and down 3.5% sequentially [13] - The percentage of ocean and air volume from the China to US trade lane declined from approximately 35% to less than 25% from 2024 [9][51] Company Strategy and Development Direction - The company is focused on disciplined execution of strategies to take market share and expand margins, regardless of market conditions [5] - There is an emphasis on leveraging artificial intelligence and automation to enhance customer and carrier experiences [6][20] - The company aims to diversify its supply chain offerings and reduce dependence on specific trade lanes [8][9] Management's Comments on Operating Environment and Future Outlook - Management noted that new tariffs and fluid trade policies have created market uncertainty, impacting customer purchasing behavior [7] - The company remains confident in its strategy and the resilience of its employees despite market challenges [9] - Management expressed optimism about the company's ability to improve operational execution and financial performance across market cycles [37] Other Important Information - The company generated $106.5 million in cash from operations in Q1 and ended with approximately $1.16 billion in liquidity [29][30] - The company returned $175 million to shareholders in Q1 through share repurchases and dividends [30] Q&A Session Summary Question: Weather impact on trucking market - Management acknowledged weather impacts in January and March but emphasized their proactive approach to managing these challenges [40][42] Question: International markets and global forwarding - Management discussed the ongoing scenario planning due to market volatility and the benefits of diversifying supply chains away from China [48][51] Question: April outlook and truckload capacity - Management refrained from providing specific guidance for April but noted that Q2 is typically stronger [62] - They confirmed that capacity is continuing to exit the marketplace, but no significant market inflections have been observed [66][68] Question: AGP deceleration and CapEx - Management clarified that the AGP deceleration was due to tougher comparisons and not indicative of a significant trend [71] - They adjusted CapEx guidance based on the outlook and prioritization of initiatives [72] Question: Headcount and market aggressiveness - Management explained that the headcount decline was influenced by the divestiture of the European Surface Transportation business and emphasized dynamic workforce management [85] - They confirmed a strategic focus on balancing market share growth with margin expansion [88][91]

FOR IMMEDIATE RELEASE C.H. Robinson Reports 2025 First Quarter Results Eden Prairie, MN, April 30, 2025 - C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (Nasdaq: CHRW) today reported financial results for the quarter ended March 31, 2025. First Quarter Highlights: Adjusted operating margin, adjusted operating margin, excluding lease impairment charge and loss on divestiture, and adjusted diluted EPS are non-GAAP financial measures. The same factors described in this release that impacted these non-GAAP mea ...

Financial Performance Highlights - Total revenues decreased by 8.3% year-over-year to $4.0 billion[10] - Adjusted Gross Profits increased by 2.3% year-over-year to $673 million[10] - Income from Operations increased significantly by 39.1% year-over-year to $177 million[10] - Net Income per Share increased by 42.3% year-over-year to $1.11[10] Segment Performance - NAST (North American Surface Transportation) adjusted gross profits increased by 5.3% year-over-year[14], with truckload AGP increasing by 6.9% to $252.0 million and LTL AGP increasing by 4.9% to $146.4 million[19] - Global Forwarding adjusted gross profits increased by 2.5% year-over-year[14], with ocean AGP increasing by 2.2% to $115.3 million and air AGP increasing by 7.1% to $32.3 million[28] - All Other & Corporate adjusted gross profits decreased by 13.0% year-over-year[14], with Other Surface Transportation AGP declining significantly by 74.1% due to the divestiture of the Europe Surface Transportation business[18, 34] Operational Improvements and Strategies - NAST gained market share in truckload and LTL, increasing AGP per shipment year-over-year through disciplined pricing and cost advantages[12] - Global Forwarding grew ocean volume year-over-year, with ocean and air AGP per shipment also increasing year-over-year[12] - The company is focused on streamlining processes, applying Lean principles, and leveraging generative AI to optimize costs and drive operating leverage[12]