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KIRBY CORP (KEX)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 EPS was $1.65, up 6% YoY, and revenue was $871.2M; both exceeded S&P Global consensus estimates (EPS $1.62*, revenue $846.2M*). EBITDA was $201.4M, above consensus $193.5M* .
  • Inland marine softened: utilization averaged mid-80% with spot rates down low-to-mid single digits; management reports utilization improved to ~87.6% in October and expects high-80s into Q4 .
  • Coastal marine remained strong: utilization mid-to-high 90% and operating margins ~20%, supported by tight vessel supply and term renewals up mid-teens YoY .
  • Distribution & Services margins improved to 11% with power generation revenue +56% YoY and +24% sequential; backlog is at a record, supported by data center demand and behind-the-meter power initiatives .
  • Capital allocation: $120.0M repurchases in Q3 (1.314M shares at $91.30) and another $36M in Q4 to date; robust free cash flow of $160.3M in Q3 .

What Went Well and What Went Wrong

What Went Well

  • Coastal marine fundamentals strong with utilization in the mid-to-high 90% and operating margins ~20% on mid-teens term renewals: “operating margins reaching around 20% for the quarter” .
  • Power generation outperformed: revenue +56% YoY, operating income +96% YoY, backlog growing on data center and industrial demand; management: “record backlog… book-to-bill well over one” .
  • Cash generation and capital returns: EBITDA $201.4M; net cash from operations $227.5M; free cash flow $160.3M; buybacks of $120.0M in Q3 and $36M in Q4 to-date .

What Went Wrong

  • Inland marine near-term softness: barge utilization mid-80% with spot rates down low-to-mid single digits sequentially and YoY; term renewals flat .
  • Marine transportation margin compression: segment operating margin fell to 18.3% from 20.1% in Q2 and 20.5% YoY; operating income down to $88.6M .
  • Distribution & Services oil and gas end market weak: revenue -38% YoY despite operating income +5% YoY; reflects softness in conventional activity (engines, transmissions, parts) .

Financial Results

Consolidated Financials (GAAP)

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$831.1 $785.7 $855.5 $871.2
Diluted EPS ($)$1.55 $1.33 $1.67 $1.65
EBITDA ($USD Millions)$190.5 $174.3 $202.2 $201.4

Segment Performance

SegmentMetricQ3 2024Q2 2025Q3 2025
Marine TransportationRevenue ($M)$486.1 $492.6 $484.9
Operating Income ($M)$99.5 $99.1 $88.6
Operating Margin (%)20.5% 20.1% 18.3%
Distribution & ServicesRevenue ($M)$345.1 $362.9 $386.2
Operating Income ($M)$30.4 $35.4 $42.7
Operating Margin (%)8.8% 9.8% 11.0%

KPIs (Inland Marine)

KPIQ3 2024Q2 2025Q3 2025
Ton Miles (millions)3,135 3,659 3,497
Revenue per Ton Mile (cents)12.5 10.9 10.8
Towboats Operated (avg)287 290 270
Delay Days2,061 3,320 1,442
Avg Fuel Cost per Gallon ($)$2.65 $2.35 $2.46
Active Inland Tank Barges (count)1,095 1,109 1,105

Actual vs Consensus (Q3 2025)

MetricConsensusActual
Revenue ($USD Millions)$846.2*$871.2
EPS ($)$1.62*$1.65
EBITDA ($USD Millions)$193.5*$201.4

Values marked with * retrieved from S&P Global.

Guidance Changes

MetricQ1 2025Q2 2025Q3 2025Change vs prior quarter
Net Cash from Ops (FY 2025)$620M–$720M $620M–$720M $620M–$720M Maintained
Capital Spending (FY 2025)$280M–$320M $260M–$290M $260M–$290M Maintained (lowered in Q2)
D&S Full-Year RevenueFlat to slightly down Flat to slightly up Up mid-single digits Raised
D&S Operating Margins (FY)High-single digits, slightly lower YoY High-single digits High-single digits Maintained
Coastal Marine (FY narrative)Utilization mid-90%; margins mid-teens Margins mid-to-high teens; utilization mid-90s Q4 revenues/margins similar to Q3; utilization mid-to-high 90s Maintained/slightly improved
Inland Near-term OutlookUtilization low-to-mid 90%; term renewals up mid-single digits Softening to low-90s entering Q3; term renewals low-to-mid single digits Q3 utilization mid-80%; improving to high-80s in Q4; term renewals flat Lowered near-term

Earnings Call Themes & Trends

TopicQ1 2025 MentionsQ2 2025 MentionsQ3 2025 MentionsTrend
Power generation (AI/data centers)Orders strong; OEM lead times causing volatile deliveries Trade policy and sourcing complexities; strong demand persists Record backlog; demand from AI data centers; working on higher power nodes; book-to-bill >1 Strengthening; backlog building
Inland utilization & pricingUtilization low-to-mid 90%; spot/term pricing up Entered Q3 slightly softer; term renewals low-to-mid single digits Q3 trough at ~80%; now ~87.6%; spot pricing firming; term flat Softened, now improving
Coastal supply & pricingTight supply; term renewals mid-20% Margins high teens; renewals robust Utilization mid-high 90%; renewals up mid-teens; ~20% margin Stable/strong
Tariffs/macroInflation, mariner shortage pressures Tariff/trade policy complexities impacting planning Vigilant to macro/geopolitical; maintaining flexibility Ongoing monitoring
M&A optionalityNot highlightedNot highlighted“Ready to do one or two” if opportunities arise; balance sheet strong Opportunistic stance

Management Commentary

  • CEO on Q3 performance: “Continued strength in coastal marine and power generation, and focused execution in the face of softer inland market conditions.”
  • Inland marine dynamics: “Spot market rates declined in the low-to-mid single digits… term contract renewals were flat… we are already seeing market conditions improve.”
  • Coastal marine: “Pricing continued to meaningfully improve… operating margins reaching around 20% for the quarter.”
  • D&S power generation: “Revenues increased 56% year-over-year… backlog grew… more opportunities in backup and behind-the-meter power applications.”
  • Outlook: “Confident the inland barge cycle still has years to go given supply constraints… strong balance sheet and robust free cash flow.”

Q&A Highlights

  • Inland trough and recovery: utilization bottomed at ~80% in Q3; currently ~87.6% with positive momentum; spot pricing has moved higher since the Q3 dip .
  • Power generation backlog: record level, mid-teens growth sequentially and YoY; size “between half a billion and a billion”; book-to-bill well over one .
  • Term renewals and pricing: inland term renewals flat in Q3; spot pricing down ~4–5% in Q3 but firming into Q4; industry supply constructive with limited newbuilds .
  • Capital returns and balance sheet: free cash flow strong; debt-to-cap ~23.8%; continued share repurchases absent acquisitions .
  • M&A posture: management “ready to transact” given strong balance sheet and free cash flow; monitor industry opportunities .

Estimates Context

  • Q3 2025 results beat S&P Global consensus on EPS ($1.65 vs $1.62*) and revenue ($871.2M vs $846.2M*); EBITDA also above ($201.4M vs $193.5M*) .
  • Estimate dispersion modest (EPS ~6 estimates; revenue ~5); given inland softness and coastal strength, we expect models to shift mix: higher D&S power generation margin assumptions, tempered inland spot pricing near term .
    Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Coastal strength and tight supply underpin ~20% operating margins; pricing power likely persists into 2026 absent new capacity .
  • Power generation is a secular growth lever tied to data centers and behind-the-meter power; record backlog and evolving high-power-node offerings expand TAM .
  • Inland softness appears transient with utilization improving into Q4; watch Q4 term renewals (40% of book rolls in Q4) and spot-price trajectory .
  • Cash generation supports continued buybacks and optionality for M&A; $227.5M CFO and $160.3M FCF in Q3; buybacks $120M in Q3 and $36M in Q4 to date .
  • FY 2025 guidance intact for CFO ($620M–$720M) and capex ($260M–$290M); D&S full-year revenue outlook stepped up to mid-single-digit growth .
  • Monitor macro/tariff developments and OEM lead times (supply chain impacts on power gen deliveries); lumpiness remains but full-year trajectory strong .
  • Near-term stock catalysts: Q4 inland utilization/pricing trends, disclosure on power-gen backlog scale and delivery cadence, additional repurchases/M&A updates .