Expeditors International of Washington, Inc. (NYSE: EXPD) has announced its financial results for the third quarter of 2024, showing significant year-over-year improvements compared to the same quarter in 2023:
- Diluted net earnings per share (EPS) increased by 41% to $1.63
- Net earnings attributable to shareholders rose by 34% to $230 million
- Operating income grew by 40% to $302 million
- Revenues climbed by 37% to $3.0 billion
- Airfreight tonnage increased by 19%, and ocean container volume grew by 12%
“We’ve worked hard this past year to increase volumes and expand our business by attracting new customers and strengthening relationships with existing ones,” said Jeffrey S. Musser, President and CEO of Expeditors. “These positive third-quarter results reflect the success of our efforts, driven by higher tonnage and volumes, which were further boosted by some shippers moving freight earlier due to concerns about port disruptions and geopolitical factors, as well as in anticipation of the fourth-quarter holiday rush. The impact of geopolitical events on pricing and the flow of freight continued to be felt throughout the quarter. Ocean transit times remained extended, particularly as carriers avoided the Red Sea region, and there were lingering concerns about potential port strikes. Air capacity remains tight and costly, making it an impractical widespread alternative for most shippers.”
Musser continued, “Strong growth in both airfreight tonnage and ocean volumes positively impacted all areas of our business this quarter. We saw increases in air tonnage and rates across all regions, with direct e-commerce demand continuing to absorb airfreight capacity and boosting rates for North Asia exports. Additionally, manufacturing relocations and the conversion of sea freight to air freight drove higher rates on exports from South Asia. Our increased volumes also led to higher revenues from customs brokerage, ancillary services, and growth in new road freight business and order management services. Overall, our team performed exceptionally well across the board.”
However, Musser cautioned that the ability to predict future trends remains challenging due to ongoing volatility in the global freight market. “We expect ocean rates may decline if demand weakens and capacity increases, especially if traffic through the Red Sea returns to normal. Global freight markets are likely to remain volatile, with unpredictable events becoming a common occurrence, suggesting disruption could be the new normal. Despite this, we remain focused on providing top-tier service to our existing customers, gaining market share, and maintaining strict cost controls.”
Bradley S. Powell, Senior Vice President and CFO, added, “We successfully handled higher volumes and tonnage during the third quarter while keeping headcount steady and controlling operating expenses. Our operating efficiency, measured by operating income as a percentage of revenue minus transportation-related costs and other expenses, has returned to our target of 30% year-to-date. We continue to manage our cash prudently, focusing on improving operational efficiencies and returning capital to our investors.”
Powell also noted that the company repurchased $140 million in common stock during the third quarter of 2024, bringing the total repurchases to $603 million year-to-date.
Expeditors is a global logistics provider headquartered in Bellevue, Washington. The company employs trained professionals across 176 district offices and numerous branch locations around the world, supported by a seamless global network and integrated information management system. Expeditors’ services include air and ocean freight forwarding, customs brokerage, vendor consolidation, cargo insurance, time-definite transportation, order management, warehousing, distribution, and customized logistics solutions.