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C. H. ROBINSON WORLDWIDE, INC. (CHRW)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered margin-led upside amid a soft top line: adjusted EPS rose 36% to $1.17 while GAAP EPS increased 42% to $1.11, driven by higher adjusted gross profit and a 6.5% reduction in operating expenses; revenue fell 8.3% primarily due to the Europe Surface Transportation divestiture, lower NA truckload volume, and lower ocean pricing .
  • Versus consensus, CHRW posted an EPS beat but revenue miss: EPS (Primary/Adjusted) of $1.17 beat S&P Global consensus of $1.05*, while revenue of $4.05B missed the $4.25B* consensus; the beat was powered by NAST and Global Forwarding margin expansion and expense discipline .
  • Operating leverage strengthened: income from operations rose 39% YoY to $176.9M with adjusted operating margin up 700 bps to 26.3% (excl. lease impairment/divestiture: 27.6%) .
  • 2025 outlook updates: management maintained full-year ETR of 18–20% and lowered 2025 capex guidance to $65–$75M (from $75–$85M) to reflect reprioritization of discretionary items; dividend maintained at $0.62 per quarter .
  • Narrative: self-help continues to drive share gains and margin expansion in NAST and Forwarding; management cited tariff-driven uncertainty and fluid trade policy as watch items but reiterated confidence in taking share and expanding margins across cycles .

What Went Well and What Went Wrong

  • What Went Well

    • NAST and Forwarding margin expansion with market share gains: NAST adjusted operating margin rose 690 bps to 34.3%; Global Forwarding adjusted operating margin rose 580 bps to 23.3% .
    • Expense discipline drove operating leverage: operating expenses fell 6.5% YoY; personnel -8.1% on productivity and optimization efforts; enterprise income from operations +39.1% .
    • AI-enabled productivity: management highlighted >3 million AI-performed shipping tasks (over 1 million orders processed and >1 million price quotes) and >30% productivity gains over 2023–2024, enabling scale benefits and faster quoting/order processing .

  • What Went Wrong

    • Revenue contracted 8.3% YoY to $4.05B, below S&P Global consensus*, reflecting EST divestiture, lower NA truckload volume, and softer ocean pricing .
    • NAST volume still soft: truckload shipments -4.5% YoY and overall NAST volume -1% despite share gains; transactional pricing remains highly competitive .
    • Macro/trade uncertainty: new tariffs and fluid trade policies introduced planning uncertainty; some customers reduced China purchases, pressuring Q2 ocean bookings out of China .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$4.64 $4.18 $4.05
Revenue YoY %+7.0% -0.9% -8.3%
Gross Profit ($USD Billions)$0.72 $0.67 $0.66
Adjusted Gross Profit ($USD Billions)$0.74 $0.68 $0.67
Diluted EPS (GAAP)$0.80 $1.22 $1.11
Adjusted Diluted EPS (Non-GAAP)$1.28 $1.21 $1.17
Operating Margin % (GAAP)3.9% 4.4% 4.4%
Adjusted Operating Margin %24.5% 26.8% 26.3%

Estimates vs Actuals (Q1 2025)

MetricActualS&P Global ConsensusSurprise
Revenue ($USD Billions)$4.05 $4.25*-4.8%
EPS (Primary/Adjusted) ($)$1.17 $1.05*+11.4%

Values with asterisk (*) retrieved from S&P Global.

Segment Results (Q1 2025 vs Q1 2024)

SegmentQ1 2024 Revenue ($M)Q1 2025 Revenue ($M)Q1 2024 Adj. GP ($M)Q1 2025 Adj. GP ($M)Q1 2024 Op Inc. ($M)Q1 2025 Op Inc. ($M)
NAST3,000.3 2,868.4 397.1 418.3 108.9 143.7
Global Forwarding858.6 774.9 180.0 184.6 31.6 42.9
All Other & Corporate553.4 403.4 80.6 70.1 (13.3) (9.8)

Service-Line Adjusted Gross Profit (Q1 2025 vs Q1 2024)

ServiceQ1 2024 ($M)Q1 2025 ($M)YoY %
Truckload257.4 262.3 +1.9%
LTL141.1 148.4 +5.2%
Ocean112.9 115.3 +2.2%
Air30.5 32.8 +7.5%
Customs26.1 26.9 +3.2%
Other Logistics59.6 54.8 -8.0%
Sourcing30.1 32.5 +8.0%

KPIs (Q1 2025 YoY and mix)

  • NAST truckload: shipments -4.5%; linehaul rate/mile +4.0%; cost/mile +3.0%; AGP per shipment +11.5%; NAST volume -1.0%; LTL volume +1.0%, AGP/order +4.0% .
  • Global Forwarding: ocean shipments +1.5% and AGP/shipment +1.0%; air AGP/ton +11.0% with tonnage -3.0%; customs AGP/transaction +1.5% on +1.5% volume .
  • Cash from operations $106.5M; capex $16.1M; buybacks $97.5M; dividend cash $77.5M .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Effective Tax RateFY 202518%–20% (Q4’24 PR) 18%–20% Maintained
Capital ExpendituresFY 2025$75–$85M (Q4’24 PR) $65–$75M Lowered
Personnel ExpensesFY 2025Management indicated “continue to expect” range (not re-disclosed in Q4 PR) $1.375–$1.475B Maintained
SG&A (incl. D&A)FY 2025Management indicated “continue to expect” range (not re-disclosed in Q4 PR) $575–$625M; D&A: $95–$105M Maintained
DividendOngoing$0.62/qtr (Feb 6, 2025) $0.62/qtr (May 9, 2025) Maintained

Notes: Management did not provide revenue or margin guidance. OI&E not guided.

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
AI/Automation/ProductivityOperating model rollout, margin/AGP gains; productivity runway highlighted >30% compounded productivity (2023–2024); scaling tech in NAST/GF >3M AI tasks; >1M orders and >1M quotes by AI; AI speeding quotes/orders, dynamic pricing, and scaling ops leverage Accelerating deployment and impact
Supply Chain/Tariffs/Trade LanesOcean pricing/volume strength; no specific tariff focus Ocean pricing buoyed; Forwarding growth New tariffs creating uncertainty; some customers shifting away from China; transpacific exposure reduced from ~35% pre-pandemic to <25% in 2024 Macro uncertainty up; diversified lanes mitigating
NAST execution/marginsNAST AGP/shipment +21% in Q3; margin expansion NAST margin sequential and YoY expansion; disciplined pricing NAST outgrew market (TL/LTL); AGP/shipment +11.5% (TL); operating margin 34.3% Continued share-gain, pricing discipline
Global Forwarding dynamicsMaterial ocean strength (pricing/volume); AGP +38% Ocean and air both strong; GF adjusted margin +1,150 bps Ocean AGP +2.2% on +1.5% shipments; air AGP +7.1%; customs +3.2%; Red Sea constraints buoying rates Normalizing growth; margins still expanding
Headcount/Cost actionsAverage HC down ~10% YoY HC down 9.5% YoY; operating leverage up Avg HC down 11.0% YoY; operating expenses -6.5% YoY Ongoing discipline

Management Commentary

  • Strategy and execution: “We’re not waiting for a market recovery…we delivered a 39% year-over-year increase in our enterprise’s income from operations…we will continue to lean into the self-help initiatives that enabled our first quarter market share growth and margin expansion.” — CEO Dave Bozeman .
  • Macro caution: “New tariffs and fluid trade policies have created market uncertainty…some customers have paused or reduced their purchases from suppliers in China…while we are certainly not immune…we remain confident in our strategy and our people.” — Bozeman .
  • AI leverage: “We are scaling our fleet of proprietary Gen AI agents…our AI agents have now performed more than 3 million shipping tasks…enabling dynamic pricing/costing and operating leverage.” — Chief Strategy & Innovation Officer Arun Rajan .
  • Financial discipline: “We generated $106.5 million in cash from operations…we now expect our full year capital expenditures to be $65 million to $75 million…net debt to EBITDA leverage at the end of Q1 was 1.54x.” — CFO Damon Lee .

Q&A Highlights

  • April/seasonality: Q2 typically stronger sequentially; April was sequentially down from March but less than last year; market remains volatile; no meaningful/sustained cost inflection yet despite capacity exits .
  • Pricing/volume balance: Contract rates seeing minimal YoY improvements; transactional market highly competitive; CHRW remains selective and leans on “move up the value stack” to defend margins .
  • RMS/TMC integration: “One Robinson” approach is now more deliberate; bundling transportation management with brokerage to drive growth is gaining positive customer response .
  • Capex/AGP trends: Lowered 2025 capex range reflects reprioritization of discretionary items, not strategic initiatives; monthly AGP comps in Q1 were affected by tougher YoY comps (not a directional change) .
  • Tariffs and customs: Diversification away from China mitigates risk; tariffs likely to lift customs activity; Forwarding scenario planning in focus .

Estimates Context

  • S&P Global consensus for Q1 2025: EPS (Primary) $1.05 on 20 estimates; revenue $4.25B on 17 estimates. CHRW delivered $1.17 adjusted EPS and $4.05B revenue, implying an EPS beat and revenue miss; EBITDA was not a focus of the company’s reporting this quarter, but consensus tracking is available and in line with reported operating leverage (see tables above)*.
  • Implications: Expect upward EPS revisions on operating leverage and cost discipline, with revenue estimates modestly trimmed for the EST divestiture impact and softer NA truckload volumes; mix and pricing discipline should keep margin estimates supported .

Values with asterisk (*) retrieved from S&P Global.

Key Takeaways for Investors

  • Margin-led story intact: Despite an 8.3% revenue decline, adjusted OPM reached 26.3% as AGP mix improved and opex fell; NAST and Forwarding continue to expand margins .
  • EPS beat vs consensus was driven by self-help and operating leverage—an ongoing theme with AI-enabled productivity and disciplined procurement/pricing .
  • Top-line risks remain from soft NA truckload volumes and tariff-driven trade uncertainty; diversification of trade lanes in Forwarding and LTL resilience help mitigate .
  • 2025 cash discipline: capex trimmed to $65–$75M while dividend is maintained at $0.62; buybacks resumed ($97.5M in Q1) with leverage at 1.54x, supporting balanced capital returns .
  • Near-term setup: Watch Q2 seasonal uplift in food/beverage/home & garden and any tariff-related ocean demand shifts; margin trajectory and productivity KPIs remain the core catalysts.
  • Medium-term thesis: Ongoing AI deployment and the “One Robinson” operating model suggest durable operating leverage and share gains through the cycle .