Key Highlights

  • Diluted EPS rose 62% from USD 1.64 to USD 2.65, topping the consensus estimate of USD 2.22.
  • Revenue climbed 42% to USD 4.11 billion, above the consensus estimate of USD 3.60 billion, with Operating Income up 55%.
  • Airfreight tonnage grew 13% and ocean container Volume grew 7%, while hyperscaler Demand outpaced the broader market.
  • Operating efficiency reached 36.7%, above the historical target of 30%, as headcount rose only 1% on 42% Revenue growth.

Expeditors International of Washington, Inc. (NYSE:EXPD) reported third quarter 2026 Diluted Earnings per Share of USD 2.65, up 62% from USD 1.64 and above a consensus estimate of USD 2.22. Revenue rose 42% to USD 4.11 billion from USD 2.89 billion, topping a consensus estimate of USD 3.60 billion. Net earnings attributable to shareholders increased 55% to USD 345 million, and operating income increased 55% to USD 445 million.

President and Chief Executive Officer Daniel Wall said the company continues to gain share in strategic markets, and that demand from customers such as hyperscalers has outpaced the overall market while the customer base broadens. The company's chief financial officer attributed the EPS gain to higher operating income, a lower tax rate and a lower share count.

Service Line Revenue and Operating Leverage

Airfreight services revenue rose to USD 1.545 billion from USD 1.020 billion, with record tonnage up about 13% led by export growth in South Asia and demand tied to AI infrastructure. Ocean freight and ocean services revenue rose to USD 1.103 billion from USD 746 million, as container volume increased 7% despite congestion from three back-to-back typhoons. Customs brokerage and other services revenue rose to USD 1.460 billion from USD 1.128 billion, with Customs, Transcon, Distribution and Order Management each posting double-digit revenue growth for a third consecutive quarter.

Salaries and other operating expenses rose 15% to USD 768.3 million, far below the 42% revenue gain. Diluted shares fell to 130.1 million from 135.3 million. Nine month net earnings were USD 840.3 million against USD 609.6 million, and nine month diluted EPS was USD 6.38 against USD 4.46.

Operating Conditions and Risk Factors

Management said air capacity remains constrained by limited fleet growth and delayed aircraft deliveries, and that airfreight rates stayed elevated as demand outpaced capacity. It anticipates ocean congestion and Supply chain challenges persisting through the remainder of 2026. China to U.S. E-commerce tonnage has nearly recovered to the level before the May 2025 end of U.S. de minimis shipments.

The company listed congestion, geopolitical conflicts in the Middle East and Ukraine, Tariff policy changes, new market capacity, changes in ocean transit times, e-commerce air demand, volatile rates and fuel prices as factors that could change results. It continues to invest in temperature controlled facilities, critical logistics services and artificial intelligence and other technology tools, which management says are intended to decouple headcount growth from revenue growth over the long term.

Cash Returns, Cash Balance and Dates Against Prior Periods

The company returned USD 197 million to shareholders in the quarter and USD 946 million over nine months, including USD 105.8 million of dividends paid against USD 104.1 million a year earlier. Cash and cash equivalents were USD 1.092 billion at September 30 compared with USD 1.314 billion at year end 2025. Nine month Operating Cash Flow was USD 700.4 million against USD 723.2 million, while third quarter operating cash flow was USD 212.6 million against USD 201.4 million.

Operating income of USD 445.4 million compares with USD 288.0 million a year earlier. The Investor Day is scheduled for November 18, 2026 in New York City, and written questions are accepted until November 6, 2026.