Executive Summary

Q3 2025 revenue was $934.5M, down 5% year over year but up 3% sequentially; GAAP diluted EPS was $0.47 and adjusted EPS was $0.49, modestly above Wall Street consensus EPS of $0.488 and revenue of $923.1M, driven by intermodal revenue per load up 2% and cost control initiatives . Values retrieved from S&P Global.
Margins improved: adjusted operating margin was 4.4% (+10 bps YoY), ITS adjusted margin 2.9% (+20 bps YoY), and Logistics adjusted margin 6.1% (+10 bps YoY, despite brokerage headwinds) as purchased transportation fell $56M YoY and G&A declined 9% .
Full-year 2025 guidance was narrowed/lowered: EPS $1.80–$1.90 (prior $1.80–$2.05), revenue $3.6–$3.7B (prior $3.6–$3.8B), reflecting muted peak outside quarter-end and later Final Mile start dates; tax ~24.5% and capex < $50M maintained .
Strategic catalysts: closed acquisitions of Marten Intermodal assets and Smith Transport LLC; alignment with UP/NS rail partners, including a new integrated Louisville service positioning Hub to convert truckload and improve utilization heading into 2026 bid season .
Balance sheet remains conservative: net debt/EBITDA LTM 0.4x and cash plus restricted cash of $147M, supporting ongoing cost savings, Final Mile onboardings (~$150M awards), and targeted M&A pipeline .

What Went Well and What Went Wrong

What Went Well

Intermodal momentum: revenue per load +2% YoY; Mexico volume grew ~300% and refrigerated +55%, aided by mix, surcharges, and improved network cost structure (“we believe we are well positioned to drive growth…”) .
Logistics profitability improved: adjusted operating margin rose to 6.1% with strong managed transportation and Final Mile onboarding progress (~$150M annual awards), offsetting brokerage weakness .
Cost discipline: purchased transportation down $56M YoY; G&A down 9%; legacy headcount down 5%, boosting margins despite demand softness .

What Went Wrong

Logistics revenue down 13% YoY; brokerage volumes -13% and revenue per load -5%; CFS exits/attrition and sub-seasonal demand weighed on top line .
Dedicated performance pressured by lost sites and competitive one-way market; late-year margin segregation in ITS expected around holidays given fixed costs and typical seasonality .
Peak season more muted than 2024; last year included $4.5M surcharges through year-end, not expected to repeat, tempering Q4 sequential EPS at guidance midpoint .

Financial Results

Consolidated Performance (Actuals)

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$915.2	$905.6	$934.5
GAAP Diluted EPS ($)	$0.44	$0.42	$0.47
Adjusted EPS ($)	$0.44 (no adjustments disclosed)	$0.45	$0.49
Operating Income ($USD Millions)	$37.3	$34.3	$39.4
Operating Margin (%)	4.1%	3.8%	4.2%
Adjusted Operating Income ($USD Millions)	N/A	$36.9	$40.7
Adjusted Operating Margin (%)	N/A	4.1%	4.4%

Notes: Where “N/A” appears, the company did not disclose an adjusted value for that period in the referenced document.

Versus Wall Street Consensus (Q3 2025)

Metric	Consensus	Actual	Surprise
Revenue ($USD Millions)	$923.1	$934.5	+$11.4 (+1.2%)
Primary EPS ($)	$0.488	$0.49	+$0.002 (+0.4%)
Primary EPS - # of Estimates	16	—	—
Revenue - # of Estimates	10	—	—

Values retrieved from S&P Global.

Segment Breakdown (Q3 2025 vs Q3 2024)

Segment	Q3 2025 Revenue ($M)	Q3 2024 Revenue ($M)	Q3 2025 GAAP OI ($M)	Q3 2025 Adjusted OI ($M)	Q3 2024 Adjusted OI ($M)
Intermodal & Transportation Services (ITS)	$561.5	$560.0	$15.9	$16.1	$15.0
Logistics	$402.4	$460.8	$23.6	$24.6	$27.5
Inter-segment eliminations	($29.4)	($33.9)	—	—	—

Selected KPIs and Operating Metrics

KPI	Q3 2025	Context
Intermodal revenue per load (YoY)	+2%	Mix, surcharges, balanced pricing
Intermodal volumes: Transcon	-1% YoY	Peak timing; mix
Intermodal volumes: Local West	-2% YoY	Allocation to West Coast lanes
Intermodal volumes: Local East	-12% YoY	Two-year stack +23%; competitive market
Mexico intermodal volume	~+300% YoY	Network investments
Refrigerated intermodal volume	+55% YoY	Scale from Marten Intermodal
Brokerage volume	-13% YoY	Soft demand; restructuring
Brokerage revenue per load	-5% YoY	Spot activity limited
Managed transportation productivity	+50% YoY	Automation/technology
In-source drayage trade %	+~700 bps YoY	Cost reduction
CFS space utilization	+1,400 bps YoY	In-sourcing third-party locations
Peak season surcharges (prior year Q4)	$4.5M	Not expected to recur in 2025

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Diluted EPS ($)	FY 2025	$1.80 – $2.05	$1.80 – $1.90	Lowered (narrowed range; reduced upper end)
Revenue ($B)	FY 2025	$3.6 – $3.8	$3.6 – $3.7	Lowered (reduced upper end)
Effective tax rate (%)	FY 2025	~24.5%	~24.5%	Maintained
Capital expenditures ($M)	FY 2025	$40 – $50	< $50	Maintained (refined phrasing)

Drivers: muted peak outside quarter-end; Final Mile start dates slipped into Q4/Q1; brokerage softness persists; cost savings continue .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2025)	Previous Mentions (Q1 2025)	Current Period (Q3 2025)	Trend
UP–NS transcontinental merger	Catalyst for growth, single-line service and reduced transits	Not highlighted in Q1 release	Strong customer engagement; new Louisville integrated service; bid season pull-forward	Improving opportunity
Intermodal pricing/yields	Price/mix and fuel headwinds	Lower RPU offset volume growth	Revenue per load +2%; headhaul pricing opportunity, backhaul competitive	Stabilizing/improving
Peak season timing/strength	Context for Q3 optimism; surcharge benefit in Q4 2024	Seasonal softness in Logistics	Later peak observed; tempered Q4 midpoint; surcharges not repeating	Mixed/normalized seasonality
Final Mile onboarding	Announced; execution underway	Seasonal softness; margin improvement	~$150M awards ramping; some market start dates shifted to Q4/Q1	Ramping with delays
Brokerage restructuring	Not detailed	Margin pressure acknowledged	Restructuring improved productivity +7%; focus on higher value loads	Productivity improving
Supply/demand/regulatory	Tariff backdrop stabilizing (Q3 commentary) —	—	Non-domiciled CDL/ELP language proficiency; capex below replacement may tighten truck capacity	Potential tightening
Technology/automation/AI	—	—	50% productivity lift in managed transportation; automation across functions	Positive ROI and execution

Management Commentary

“We remain focused on serving customers and realizing the intermodal growth potential for Hub Group in collaboration with our rail partners Union Pacific and Norfolk Southern.” — Phil Yeager, CEO .
“We closed on the acquisition of Martin Transport’s intermodal division… and Smith Transport LLC… while returning capital to shareholders, executing on our cost reduction program, and maintaining excellent service.” .
“The launch of a new integrated service in Louisville has led to conversion… and new customer lanes… We believe we are well positioned to drive growth as peak season kicks off.” .
“Adjusted operating income margin was 4.4%… ITS adjusted margin 2.9%… Logistics adjusted margin 6.1% despite the challenging brokerage environment.” — Kevin Beth, CFO .
“We remain confident in achieving the targeted $50 million of cost savings on a run-rate basis by the end of the year.” .

Q&A Highlights

Bid season and merger positioning: Hub expects ~48% of intermodal network bid/effective in Q1 and ~38% in Q2; customer engagement around UP–NS merger is “overwhelmingly positive,” positioning for share gains and improved service .
Volume cadence: July flat; August -5%; September +6%; October MTD +3% with strong last two weeks; anticipating demand into November before typical seasonal slowdown .
Capital allocation and capacity: Net debt ~$136M; willing to lever up to ~2x for the right M&A; stacked containers (~25% of fleet) and utilization improvements imply ~35% capacity, with potential +10% from reduced transit times .
Final Mile: Startups delayed to ensure smooth transitions; onboarding meeting/exceeding expectations heading into Black Friday; housing recovery would be a significant tailwind .
Repositioning costs/surcharges: Elevated Q3 repositioning costs more than offset by surcharges; not expecting last year’s $4.5M surcharge benefit to recur in Q4 .

Estimates Context

Q3 2025 results were slightly above consensus: revenue beat by ~1.2% and EPS by ~0.4%, likely driven by intermodal RPU +2%, surcharges, and cost control . Values retrieved from S&P Global.
Given guidance narrowing, near-term estimate revisions may edge lower for Q4 EPS at midpoint (sequential decline implied) while 2026 could reflect upside from bid season wins, Final Mile ramp, and potential rail network benefits .

Key Takeaways for Investors

Modest Q3 beat with sequential margin improvement; intermodal RPU and cost actions offset brokerage headwinds and sub-seasonal demand .
Guidance narrowed/lowered (EPS $1.80–$1.90; revenue $3.6–$3.7B); near-term setup implies cautious Q4 while 2026 bid season could be a positive inflection .
Strategic rail alignment (UP–NS) and new Louisville service create truck-to-intermodal conversion opportunities and improved asset utilization without near-term container capex needs .
Final Mile onboardings (~$150M awards) and managed transportation automation (50% productivity lift) underpin logistics margin resilience despite brokerage softness .
Balance sheet flexibility (net debt/EBITDA LTM 0.4x; $147M cash/restricted cash) supports targeted M&A (e.g., Marten Intermodal assets) and shareholder returns .
Watch drivers: holiday seasonality, brokerage spot activity, dedicated site losses, and regulatory impacts on truck capacity (non-domiciled CDL/ELP) influencing 2026 pricing/yields .
Trading implications: Near term neutral-to-cautious into Q4; medium-term constructive on intermodal share gains and margin repair as bid season and Final Mile ramp progress .

Hub Group, Inc. (HUBG)·Q3 2025 Earnings Summary