Expeditors International of Washington, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenues increased 42% year-over-year to $4.1 billion for the quarter and 27% to $10.4 billion for the nine-month period.
• Diluted Net Earnings Attributable to Shareholders per share (EPS) increased 62% to $2.65 for the quarter and 43% to $6.38 for the nine months.
• Net Earnings Attributable to Shareholders increased 55% to $345 million for the quarter and 38% to $840 million for the nine months.
• Operating Income increased 55% to $445 million for the quarter and 36% to $1.09 billion for the nine months.
• Operating efficiency increased to 36.7% for the quarter, exceeding the historical target of 30%.
• Headcount increased only 1% year-over-year despite revenue growth.
• Cash returned to shareholders totaled $197 million in the quarter and $946 million year-to-date.
• Share repurchases totaled $197 million in the quarter (1.1 million shares) and $840 million year-to-date (5.4 million shares).
• Accounts receivable increased to $3.1 billion at September 30, 2026, from $2.0 billion at December 31, 2025.
• Contract liabilities increased to $450 million at September 30, 2026, from $358 million at December 31, 2025.
• Net cash from operating activities was $213 million for the quarter and $700 million for the nine months.

Guidance and Future Outlook:

• Management expects congestion and supply chain challenges to persist through the remainder of 2026.
• The company plans to continue making high-return investments in artificial intelligence and technology solutions to decouple headcount growth from revenue growth and increase net operating margins long-term.
• An Investor Day is scheduled for November 18, 2026, in New York City.

Business Segments and Product Lines:

• Customs, Transcon, Distribution, and Order Management each achieved double-digit revenue growth for a third consecutive quarter.
• Airfreight tonnage increased 13% year-over-year, driven by growth in South Asia and hyperscaler demand (including AI infrastructure suppliers).
• Ocean container volume increased 7% year-over-year, with strong growth in September and Asia export markets.
• Customs brokerage and other services generated double-digit growth, driven by tariff-related fees, new business wins, and demand from AI hyperscalers and technology customers.
• Transcon road freight and warehousing/distribution businesses saw robust demand from large technology customers.
• Airfreight rates remained elevated due to demand outpacing capacity constrained by limited fleet expansion and aircraft delivery delays.
• Ocean freight capacity was impacted by port congestion and typhoons in Asia, though the company leveraged carrier relationships to maintain service continuity.

Market and Competitive Landscape:

• The company is gaining market share in strategic focus markets.
• Hyperscaler demand is outpacing the overall market.
• The company is deliberately expanding its customer base across its global network to diversify revenues.
• China-U.S. e-commerce tonnage has nearly recovered to pre-May 2025 levels following the U.S. termination of de minimis shipments.
• European Union regulations curbing de minimis imports impacted Asia-Europe e-commerce capacity.

Risks and Challenges:

• Forward-looking statements cite risks including congestion, supply chain challenges, geopolitical uncertainty, and ongoing conflicts in the Middle East and Ukraine.
• Risks include national policy changes on tariffs, new capacity in the marketplace, changes in ocean transit times, volatile rates, and fuel price fluctuations.
• Port actions, labor disruptions, and global economic uncertainty could heighten other risks.

Management Commentary and Tone:

• CEO Daniel R. Wall stated the company generated double-digit growth across most businesses and is charting a course for durable performance regardless of the operating environment.
• CFO David Hackett highlighted the scalability of the operating model, noting revenue growth of 42% with only 1% headcount increase.
• Management expressed confidence in the durability of earnings growth and the strength of the new business pipeline.
• The tone emphasized resilience during disruption and the strategic focus on decoupling headcount from revenue growth.

Other Key Points:

• The company is an asset-light S&P 500 global logistics company headquartered in Bellevue, Washington.
• Investments are being made in temperature-controlled facilities and critical logistics services.
• The company returned $946 million to shareholders via dividends and share repurchases for the first nine months of 2026.
• Total assets increased to $5.79 billion at September 30, 2026, from $4.89 billion at December 31, 2025.
• Shareholders' equity decreased slightly to $2.34 billion at September 30, 2026, from $2.36 billion at December 31, 2025.