Expeditors Second-Quarter Profit Falls as Red Sea Tensions Weigh

Aug 6 (Reuters) – Logistics provider Expeditors International of Washington reported a lower second-quarter profit on Tuesday, after weak demand and political tensions in the Red Sea weighed on its ocean routing unit.

Shares of the company were down about 5% in early trade.

The Seattle, Washington-based company said geopolitical events in the Red Sea had led to less frequent services, extended transit times, and port congestion, while a surge in e-commerce demand had strained its air market capacity.

“We have continued to adjust to the disruptions and uneven demand, keeping costs in check while we work to bring efficiency back in line with historical expectations,” Expeditors CEO Jeffrey Musser said.

Musser added that the company faces headwinds related to demand, capacity, pricing, and unpredictable events with the potential to impact global shipping times, despite some signs of improving market conditions.

The company’s net income in the second quarter ended June 30 fell to $175 million or $1.24 per share, compared with $196.8 million or $1.30 per share a year ago.

Analysts, on average, expected the company to report a profit of $1.26 per share, according to LSEG data.

The company, which has a presence in more than 100 countries, reported a 9% rise in quarterly revenue to $2.4 billion, beating analysts’ estimates of about $2.28 billion.

(Reporting by Abhinav Parmar and Nathan Gomes in Bengaluru; Editing by Tasim Zahid)

(c) Copyright Thomson Reuters 2024.

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