Expeditors reports revenue drop of 36%

Fourth-quarter revenue decreased 36% from 2021, logistics firm Expeditors International said in its latest earnings report. The Seattle-based company, with a market cap of $16.7 billion, reported Tuesday that buy and sell rates and fourth quarter demand did not meet expectations, which caused year over year declines in revenue, operating income and diluted earnings attributable to shareholders. BY THE NUMBERS: Expeditors reported overall revenue growth for 2022, despite YoY drops in many Q4 stats: Q4 revenue was $3.44 billion, down 36.23% from 2021; Operating income for the quarter was $329,706, down 47.12% from 2021; Diluted earnings per share were $1.38 for the quarter, down 48.1% from 2021; Full - year 2022 revenue was $17.07 million, a 3.32% increase from 2021; and Net earnings fell 4.1% to $1.36 million for 2022. “As pandemic-related bottlenecks eased and air and ocean supply/demand imbalances began to dissipate in the first half of the year, average buy and sell rates progressively declined to varying degrees, as they typically do — until they suddenly began to plummet simultaneously and faster than we would have expected in the fourth quarter,” said Jeff Musser, president and CEO, in the earnings report. “Fourth-quarter demand also was softer than we would have expected, particularly in retail and high tech,” Musser said. NOTEWORTHY: The company’s airfreight services revenue decreased YoY for Q4 and the full year. Airfreight revenue was $1.2 million for the quarter, down 47.48% YoY, while full year airfreight revenue was $5.89 million, down 13.06% from 2021. Airfreight tonnage volume decreased 20% YoY in Q4. MARKET REACTION: Shares of Expeditors (NYSE: EXPD) fell 5.57% to $105.20 Tuesday after the earnings announcement. Shares closed at the same price on Wednesday. LOOKING AHEAD: “Our short-term outlook is somewhat uncertain due to a difficult economic environment and the resetting of supply and demand, which has a direct impact on available capacity and pricing,” Musser said. “We plan to move forward with a sharp eye on aligning expenses with revenues, particularly over the next one or two quarters. “Our focus will be on maintaining our existing accounts and gaining new business, while reducing overall expenses,” he added. “Just as we quickly configured our operations to accommodate unprecedented chaos and complexity during the pandemic, we now need to address our operations for a post-pandemic environment of soft demand and pressured pricing.” Expeditors has faced other unwelcome news recently, as iRobot recently filed a $2.1 million lawsuit against the company following a ransomware attack in February 2022. iRobot sued for incurred costs and expenses after it had to switch to a new logistics provider and reimburse retailers.

Expeditors reports revenue drop of 36%

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