C.H. Robinson(CHRW) - 2025 Q2 - Quarterly Report

PART I. Financial Information Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for the periods ended June 30, 2025, and 2024, including balance sheets, statements of operations, changes in stockholders' investment, and cash flows, with detailed notes on presentation and accounting policies Condensed Consolidated Balance Sheets As of June 30, 2025, total assets were $5.32 billion, a slight increase from $5.30 billion at the end of 2024, driven by receivables and reduced assets held for sale; total liabilities decreased slightly to $3.54 billion, and total stockholders' investment grew to $1.78 billion | Balance Sheet Highlights | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :--- | :--- | :--- | | Total Current Assets | 3,013,714 | 2,969,603 | | Total Assets | 5,321,911 | 5,297,926 | | Total Current Liabilities | 2,295,839 | 2,324,898 | | Total Liabilities | 3,537,524 | 3,575,875 | | Total Stockholders' Investment | 1,784,387 | 1,722,051 | Condensed Consolidated Statements of Operations and Comprehensive Income For Q2 2025, total revenues decreased 7.7% year-over-year to $4.14 billion, while income from operations increased 21.2% to $215.9 million, and net income rose 20.8% to $152.5 million, resulting in diluted net income per share of $1.26 | Metric ($ thousands, except per share) | Q2 2025 | Q2 2024 | YoY Change | H1 2025 | H1 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenues | 4,136,543 | 4,483,348 | -7.7% | 8,183,283 | 8,895,659 | -8.0% | | Income from Operations | 215,919 | 178,090 | +21.2% | 392,772 | 305,223 | +28.7% | | Net Income | 152,471 | 126,251 | +20.8% | 287,773 | 219,155 | +31.3% | | Diluted Net Income per Share | $1.26 | $1.05 | +20.0% | $2.37 | $1.83 | +29.5% | Condensed Consolidated Statements of Stockholders' Investment Total stockholders' investment increased from $1.72 billion at year-end 2024 to $1.78 billion as of June 30, 2025, driven by $287.8 million in net income, partially offset by $130.2 million in stock repurchases and $150.1 million in dividends | Activity (Six Months Ended June 30, 2025) | Amount ($ thousands) | | :--- | :--- | | Beginning Balance (Dec 31, 2024) | 1,722,051 | | Net Income | 287,773 | | Dividends Declared | (150,120) | | Repurchase of Common Stock | (130,252) | | Other (Stock Comp, FX, etc.) | 54,935 | | Ending Balance (June 30, 2025) | 1,784,387 | Condensed Consolidated Statements of Cash Flows For H1 2025, net cash from operating activities significantly increased to $333.7 million from $133.1 million in H1 2024, while financing activities used $332.7 million for repurchases and dividends, and investing activities used $8.5 million | Cash Flow Activity ($ thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | 333,659 | 133,099 | | Net Cash used for Investing Activities | (8,504) | (41,811) | | Net Cash used for Financing Activities | (332,685) | (120,065) | | Net Change in Cash | (545) | (32,358) | Notes to Condensed Consolidated Financial Statements The notes detail significant accounting policies and activities, including segment information for NAST and Global Forwarding, the divestiture of the Europe Surface Transportation business, the 2025 Restructuring Program, financing, and stock-based compensation - The company's reportable segments are North American Surface Transportation (NAST) and Global Forwarding. All other segments, including Robinson Fresh and Managed Solutions, are grouped into 'All Other and Corporate'[20] - Goodwill decreased from $1.46 billion to $1.44 billion in the first six months of 2025, primarily due to the disposal of $28.7 million in goodwill related to the sale of the Europe Surface Transportation business[26] - A new '2025 Restructuring Program' was initiated in Q2 2025 to enhance efficiency through technology and AI, with expected charges of $50 million to $75 million over the next three years[87][90] - The company completed the sale of its Europe Surface Transportation business on February 1, 2025, receiving $27.7 million in cash at closing[100] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses performance amid market shifts, noting North American surface transportation stabilization and global forwarding volatility, with Q2 revenue down 7.7% but operating income up 21.2% due to cost optimization and strategic divestiture Market and Business Trends In Q2 2025, the North American surface transportation market showed improved balance with modest rate increases, while the global forwarding market experienced volatility from U.S. tariff policies, impacting freight volumes and rates - The North American surface transportation market showed signs of improved balance in Q2 2025 due to carriers exiting the market, leading to a modest year-over-year increase in transportation rates[109] - The global forwarding market experienced significant volatility from U.S. tariff policy shifts, leading to a sharp decline in freight volumes early in Q2, followed by a short-lived rebound[110] - Despite challenging market conditions, the company's combined North American Surface Transportation (NAST) truckload and less than truckload (LTL) volume increased 1.0% in Q2 2025, outperforming the broader market[111] Consolidated Results of Operations For Q2 2025, total revenues decreased 7.7% year-over-year to $4.1 billion, but adjusted gross profits increased 0.8% to $693.2 million, driving a 21.2% increase in income from operations to $215.9 million and a 20.0% increase in diluted EPS to $1.26 | Metric ($ thousands, except per share) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | 4,136,543 | 4,483,348 | (7.7)% | | Income from Operations | 215,919 | 178,090 | 21.2% | | Net Income | 152,471 | 126,251 | 20.8% | | Diluted Net Income per Share | $1.26 | $1.05 | 20.0% | | Adjusted Gross Profits | $693,231 | $687,409 | 0.8% | - Personnel expenses decreased 7.2% to $335.3 million, primarily due to cost optimization, productivity improvements, and the divestiture of the Europe Surface Transportation business[114][120] Segment Results In Q2 2025, NAST operating income grew 16.2% to $164.0 million, Global Forwarding operating income rose 25.3% to $51.3 million, and All Other and Corporate reported $0.6 million in operating income, a significant improvement from a prior-year loss | Segment Performance (Q2 2025 vs Q2 2024) | Income from Operations ($ thousands) | % Change | Adjusted Gross Profits ($ thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | NAST | 163,991 | 16.2% | 432,248 | 3.0% | | Global Forwarding | 51,330 | 25.3% | 187,581 | 1.9% | | All Other and Corporate | 598 | N/M | 73,402 | (12.3)% | Liquidity and Capital Resources The company maintained strong liquidity with $156.0 million in cash as of June 30, 2025, generating $333.7 million in cash from operations for H1 2025, while returning $128.8 million in stock repurchases and $152.4 million in dividends | Major Sources and Uses of Cash (H1 2025) | Amount ($ thousands) | | :--- | :--- | | Cash from Operating Activities | 333,659 | | Capital Expenditures | (36,241) | | Repurchase of Common Stock | (128,767) | | Cash Dividends | (152,355) | | Net Payments on Debt | (24,000) | - Cash and cash equivalents totaled $156.0 million as of June 30, 2025, with $146.2 million held outside the United States[165] PART II. Other Information Legal Proceedings The company is not subject to any pending or threatened litigation that would materially affect its financial position, results of operations, or cash flows, beyond routine business litigation - The company is not subject to any material legal proceedings outside the ordinary course of business[180] Risk Factors The company reports no material changes to the risk factors previously disclosed in its Annual Report on Form 10-K for the year ended December 31, 2024 - There have been no material changes in the company's risk factors since the 2024 Annual Report on Form 10-K[181] Share Repurchases During Q2 2025, the company repurchased 870,500 shares of common stock at an average price of $93.33 per share, with 5,408,130 shares remaining available for repurchase under the current authorization as of June 30, 2025 | Period (2025) | Total Shares Purchased | Average Price Paid | Shares Purchased (Public Plan) | | :--- | :--- | :--- | :--- | | April | 328,174 | $91.24 | 316,500 | | May | 308,828 | $94.26 | 294,000 | | June | 284,429 | $94.74 | 260,000 | | Q2 Total | 921,431 | $93.33 | 870,500 | - As of June 30, 2025, 5,408,130 shares remained authorized for future repurchase under the company's plans[182] Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[177] - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[178]