Expeditors Reports Third Quarter 2024 EPS of $1.63

BELLEVUE, Wash.--(BUSINESS WIRE)--Expeditors International of Washington, Inc. (NYSE:EXPD) today announced third quarter 2024 financial results including the following comparisons to the same quarter of 2023:

• Diluted Net Earnings Attributable to Shareholders per share (EPS¹) increased 41% to $1.63
• Net Earnings Attributable to Shareholders increased 34% to $230 million
• Operating Income increased 40% to $302 million
• Revenues increased 37% to $3.0 billion
• Airfreight tonnage increased 19% and ocean container volume increased 12%

^1Diluted earnings attributable to shareholders per share.

NOTE: See Disclaimer on Forward-Looking Statements in this release.

“We have worked hard over this past year to gain additional volumes and grow our business by winning new customers and gaining additional business with current customers,” said Jeffrey S. Musser, President and Chief Executive Officer. “These positive third-quarter results reflect those efforts in securing higher tonnage and volumes, which were further boosted as some shippers pulled freight forward out of concern over port actions and geopolitical disruptions, and in advance of fourth quarter holiday sales. Geopolitical events continued to impact pricing and the flow of freight during the quarter. Ocean transit times remained extended because carriers avoided the Red Sea and were further disrupted by prior concerns over potential port strikes. Air capacity is too scarce and costly to serve as a viable widespread alternative for most shippers.

“Strong growth in air tonnage and ocean volumes had a positive impact on all areas of our business during the quarter. Air tonnage and rates increased across all regions. Direct e-commerce continued to absorb available air freight capacity and boost rates on North Asia exports, and manufacturing relocations and sea-to-air conversions drove higher rates on exports from South Asia. Higher volumes moving through our network led to an increase in fees for customs brokerage and other ancillary services, in addition to new road freight business and growth in order management services. All in all, I would be hard pressed to point to an area of our business where our people did not perform at their highest level.

“We would again caution that our ability to see much beyond our day-to-day levels of activity remains challenging. We believe that ocean rates may decline if demand softens and capacity increases, particularly if commerce on the Red Sea returns to normal. We also believe that global freight markets and pricing are likely to remain volatile for some time. Unpredictable events seem to occur with such increased regularity as to make us wonder if disruption is the new state of normal. Regardless, we remain focused on servicing our current customers and gaining market share, while keeping costs in check.”

Bradley S. Powell, Senior Vice President and Chief Financial Officer, added, “We handled increased volumes and tonnage in the third quarter and executed well throughout our network, while keeping headcount flat and controlling operating expenses. Our measure of operating efficiency (operating income as a percentage of revenue less directly related cost of transportation and other expenses) is now back to our 30% target for the year to date. We continue to control and carefully manage our cash, while working to improve operational efficiencies and return capital to investors.”

Mr. Powell noted that the Company repurchased $140 million in common stock during the third quarter of 2024, and $603 million year to date.

Expeditors is a global logistics company headquartered in Bellevue, Washington. The Company employs trained professionals in 176 district offices and numerous branch locations located on six continents linked into a seamless worldwide network through an integrated information management system. Services include the consolidation or forwarding of air and ocean freight, customs brokerage, vendor consolidation, cargo insurance, time-definite transportation, order management, warehousing and distribution and customized logistics solutions.

Disclaimer on Forward-Looking Statements:

Certain statements contained in this news release are “forward-looking statements,” based on management’s views with respect to future events and underlying assumptions that involve risks and uncertainties. These forward-looking statements include statements regarding inflation; continued growth in air and ocean carrier capacity and the impact on rates; unpredictability in the ocean and air markets, including uncertainty due to conflicts in the Middle East and Red Sea; port actions and other labor disruptions; new capacity in the marketplace; longer ocean transit times; strong e-commerce demand in the air market; and volatile rates. Future financial performance could differ materially because of factors such as: our ability to secure higher air tonnage and ocean volumes; our ability to keep headcount and other costs in check while continuing to generate efficiency that meets our historical expectations; the alignment of our variable compensation structure with performance; our ability to enhance and bolster our network security; that management is able to grow the business and explore new areas for profitable growth; our ability to leverage the strength of our carrier relationships; the strength of our non-asset-based operating model; and our ability to remain a strong, healthy, unified and resilient organization. Geo-political risks, port actions and other labor disruptions, and the current uncertainty in the global economy could have the effect of heightening many of the other risks described in Item 1A of our Annual Report on Form 10-K, including, without limitation, those related to the success of our strategy and desire to maintain historical unitary profitability, our ability to attract and retain customers, our ability to manage costs, interruptions to our information technology systems, the ability of third-party providers to perform and potential litigation and contingencies, including risks associated with tax audits, as updated by our reports on Form 10-Q, filed with the Securities and Exchange Commission. These and other factors are discussed in the Company’s regulatory filings with the Securities and Exchange Commission, including those in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and the Company’s most recent Form 10-Q. The forward-looking statements contained in this news release speak only as of this date and the Company does not assume any obligation to update them except as required by law.

Expeditors International of Washington, Inc.
Third Quarter 2024 Earnings Release, November 5, 2024
Financial Summary for the three months ended September 30, 2024 and 2023 (Unaudited)
(in 000's of US dollars except share data)
	Three months ended September 30,						Nine months ended September 30,
	2024		2023		% Change		2024		2023		% Change
Revenues	$	3,000,131	$	2,190,001	37	%	$	7,645,810	$	7,022,342	9	%
Directly related cost of transportation and other expenses ^1	$	2,093,964	$	1,402,111	49	%	$	5,166,652	$	4,540,396	14	%
Salaries and other operating expenses ^2	$	604,643	$	571,821	6	%	$	1,738,939	$	1,741,411	(0	)%
Operating income	$	301,524	$	216,069	40	%	$	740,219	$	740,535	(0	)%
Net earnings attributable to shareholders	$	229,574	$	171,353	34	%	$	574,195	$	594,164	(3	)%
Diluted earnings attributable to shareholders per share	$	1.63	$	1.16	41	%	$	4.04	$	3.92	3	%
Basic earnings attributable to shareholders per share	$	1.63	$	1.16	41	%	$	4.06	$	3.95	3	%
Diluted weighted average shares outstanding		141,027		148,001				142,288		151,619
Basic weighted average shares outstanding		140,417		147,099				141,540		150,543
^1Directly related cost of transportation and other expenses totals Operating Expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.
^2Salaries and other operating expenses totals Salaries and related, Rent and occupancy, Depreciation and amortization, Selling and promotion and Other as shown in the Condensed Consolidated Statements of Earnings.

During the three and nine months ended September 30, 2024 we repurchased 1.2 million and 5.1 million shares of common stock at an average price of $118.47 and $119.21 per share. During the three and nine months ended September 30, 2023 we repurchased 2.6 million and 10.5 million shares of common stock at an average price of $116.29 and $113.97 per share.

	Employee Full-time Equivalents as of
	September 30, 2024		September 30, 2023
North America		6,920		6,975
Europe		3,838		3,811
North Asia		2,271		2,290
South Asia		1,776		1,709
Middle East, Africa and India		1,386		1,440
Latin America		780		753
Information Systems		1,303		1,244
Corporate		416		403
Total		18,690		18,625

	Third quarter year-over-year percentage increase (decrease) in:
2024	Airfreight kilos	Ocean freight FEU
July	20%	8%
August	17%	14%
September	20%	15%
Quarter	19%	12%

Investors may submit written questions via e-mail to: [e-mail]. Questions received by the end of business on November 8, 2024 will be considered in management's 8-K “Responses to Selected Questions.”

___________________________
NOTE: See Disclaimer on Forward-Looking Statements in this release.

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
	September 30, 2024			December 31, 2023
Assets:
Current Assets:
Cash and cash equivalents	$	1,293,173		$	1,512,883
Accounts receivable, less allowance for credit loss of $5,903 at September 30, 2024 and $6,550 at December 31, 2023		2,176,959			1,532,599
Deferred contract costs		431,640			218,807
Other		181,273			170,907
Total current assets		4,083,045			3,435,196
Property and equipment, less accumulated depreciation and amortization $624,562 at September 30, 2024 and $597,473 at December 31, 2023		468,594			479,225
Operating lease right-of-use assets		525,810			516,280
Goodwill		7,927			7,927
Deferred federal and state income taxes, net		69,789			63,690
Other assets, net		15,752			21,491
Total assets	$	5,170,917		$	4,523,809
Liabilities:
Current Liabilities:
Accounts payable	$	1,240,174		$	860,856
Accrued liabilities, primarily salaries and related costs		470,723			447,336
Contract liabilities		532,289			280,909
Current portion of operating lease liabilities		106,832			99,749
Federal, state and foreign income taxes		25,728			15,562
Total current liabilities		2,375,746			1,704,412
Noncurrent portion of operating lease liabilities		436,001			427,984
Shareholders’ Equity:
Preferred stock, none issued		—			—
Common stock, par value $0.01 per share. Issued and outstanding: 139,971 shares at September 30, 2024 and 143,866 shares at December 31, 2023		1,400			1,439
Additional paid-in capital		4,307			—
Retained earnings		2,540,978			2,580,968
Accumulated other comprehensive loss		(189,978	)		(192,057	)
Total shareholders’ equity		2,356,707			2,390,350
Noncontrolling interest		2,463			1,063
Total equity		2,359,170			2,391,413
Total liabilities and equity	$	5,170,917		$	4,523,809

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Earnings
(In thousands, except per share data)
(Unaudited)
	Three months ended September 30,					Nine months ended September 30,
	2024		2023			2024		2023
Revenues:
Airfreight services	$	986,950	$	724,331		$	2,606,647	$	2,380,405
Ocean freight and ocean services		1,017,618		560,281			2,240,079		1,851,389
Customs brokerage and other services		995,563		905,389			2,799,084		2,790,548
Total revenues		3,000,131		2,190,001			7,645,810		7,022,342
Operating Expenses:
Airfreight services		740,356		516,519			1,923,115		1,707,568
Ocean freight and ocean services		783,827		387,670			1,675,931		1,277,159
Customs brokerage and other services		569,781		497,922			1,567,606		1,555,669
Salaries and related		450,308		412,505			1,289,901		1,290,911
Rent and occupancy		61,024		58,387			181,873		174,224
Depreciation and amortization		15,774		15,607			45,914		46,374
Selling and promotion		7,589		6,149			22,366		18,847
Other		69,948		79,173			198,885		211,055
Total operating expenses		2,698,607		1,973,932			6,905,591		6,281,807
Operating income		301,524		216,069			740,219		740,535
Other Income (Expense):
Interest income		9,917		17,156			36,699		53,723
Other, net		973		(1,334	)		4,599		4,394
Other income, net		10,890		15,822			41,298		58,117
Earnings before income taxes		312,414		231,891			781,517		798,652
Income tax expense		82,488		61,048			206,040		206,018
Net earnings		229,926		170,843			575,477		592,634
Less net earnings (losses) attributable to the noncontrolling interest		352		(510	)		1,282		(1,530	)
Net earnings attributable to shareholders	$	229,574	$	171,353		$	574,195	$	594,164
Diluted earnings attributable to shareholders per share	$	1.63	$	1.16		$	4.04	$	3.92
Basic earnings attributable to shareholders per share	$	1.63	$	1.16		$	4.06	$	3.95
Weighted average diluted shares outstanding		141,027		148,001			142,288		151,619
Weighted average basic shares outstanding		140,417		147,099			141,540		150,543

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Operating Activities:
Net earnings	$	229,926		$	170,843		$	575,477		$	592,634
Adjustments to reconcile net earnings to net cash from operating activities:
Provisions for (recoveries) losses on accounts receivable		(582	)		1,411			1,456			2,316
Deferred income tax benefit		(1,057	)		(6,418	)		(5,680	)		(7,942	)
Stock compensation expense		9,760			15,879			47,836			46,962
Depreciation and amortization		15,774			15,607			45,914			46,374
Other, net		162			2,673			4,032			6,396
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable		(301,167	)		(53,722	)		(647,794	)		629,205
Increase (decrease) in accounts payable and accrued liabilities		107,535			40,919			402,818			(311,990	)
(Increase) decrease in deferred contract costs		(30,657	)		(56,917	)		(216,977	)		28,870
Increase (decrease) in contract liabilities		50,527			74,701			254,902			(33,549	)
Increase (decrease) in income taxes payable, net		20,331			(4,017	)		13,163			(97,743	)
Increase in other, net		(10,580	)		(10,979	)		(1,502	)		(6,695	)
Net cash from operating activities		89,972			189,980			473,645			894,838
Investing Activities:
Purchase of property and equipment		(12,291	)		(7,993	)		(30,415	)		(28,600	)
Other, net		(225	)		10			(62	)		(209	)
Net cash from investing activities		(12,516	)		(7,983	)		(30,477	)		(28,809	)
Financing Activities:
Proceeds (payments) on borrowings on lines of credit, net		10,445			6,913			(5,538	)		(6,683	)
Proceeds from issuance of common stock		53,256			61,841			67,734			80,305
Repurchases of common stock		(140,031	)		(298,103	)		(602,855	)		(1,199,294	)
Dividends paid		—			—			(102,638	)		(102,263	)
Payments for taxes related to net share settlement of equity awards		—			—			(15,348	)		(19,501	)
Net cash from financing activities		(76,330	)		(229,349	)		(658,645	)		(1,247,436	)
Effect of exchange rate changes on cash and cash equivalents		20,194			(11,807	)		(4,233	)		(13,296	)
Change in cash and cash equivalents		21,320			(59,159	)		(219,710	)		(394,703	)
Cash and cash equivalents at beginning of period		1,271,853			1,698,587			1,512,883			2,034,131
Cash and cash equivalents at end of period	$	1,293,173		$	1,639,428		$	1,293,173		$	1,639,428
Taxes Paid:
Income taxes	$	63,046		$	61,603		$	196,649		$	306,059

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Business Segment Information
(In thousands)
(Unaudited)
	UNITED STATES		OTHER NORTH AMERICA		LATIN AMERICA		NORTH ASIA		SOUTH ASIA		EUROPE		MIDDLE EAST, AFRICA AND INDIA		ELIMI- NATIONS			CONSOLI- DATED
For the three months ended September 30, 2024:
Revenues	$	854,679		114,264		61,981		914,417		445,308		433,660		177,145		(1,323	)		3,000,131
Directly related cost of transportation and other expenses^1	$	443,930		67,626		38,973		763,781		369,905		279,235		131,098		(584	)		2,093,964
Salaries and other operating expenses^2	$	253,452		35,261		18,605		86,566		51,307		126,917		33,283		(748	)		604,643
Operating income	$	157,297		11,377		4,403		64,070		24,096		27,508		12,764		9			301,524
Identifiable assets at period end	$	2,611,417		192,370		108,985		727,724		376,283		863,840		319,627		(29,329	)		5,170,917
Capital expenditures	$	9,299		198		101		296		839		1,548		10		—			12,291
Equity	$	1,628,893		35,825		42,670		221,519		124,387		182,515		164,665		(41,304	)		2,359,170
For the three months ended September 30, 2023:
Revenues	$	784,503		106,293		47,327		515,340		207,006		410,904		119,849		(1,221	)		2,190,001
Directly related cost of transportation and other expenses^1	$	421,432		63,671		28,409		398,681		145,292		263,524		81,643		(541	)		1,402,111
Salaries and other operating expenses^2	$	261,323		38,275		16,405		66,546		42,138		120,436		27,351		(653	)		571,821
Operating income	$	101,748		4,347		2,513		50,113		19,576		26,944		10,855		(27	)		216,069
Identifiable assets at period end	$	2,572,404		200,711		110,708		512,746		217,018		726,729		260,619		(22,814	)		4,578,121
Capital expenditures	$	3,762		302		84		168		409		1,369		1,899		—			7,993
Equity	$	1,797,123		46,264		54,096		225,229		91,712		154,617		161,882		(39,449	)		2,491,474
	UNITED STATES		OTHER NORTH AMERICA		LATIN AMERICA		NORTH ASIA		SOUTH ASIA		EUROPE		MIDDLE EAST, AFRICA AND INDIA		ELIMI- NATIONS			CONSOLI- DATED
For the nine months ended September 30, 2024:
Revenues	$	2,385,392		331,837		151,787		2,096,709		960,970		1,241,432		481,600		(3,917	)		7,645,810
Directly related cost of transportation and other expenses^1	$	1,270,981		199,710		88,077		1,702,401		757,167		796,205		353,839		(1,728	)		5,166,652
Salaries and other operating expenses^2	$	772,835		102,684		49,920		224,588		135,303		363,718		92,099		(2,208	)		1,738,939
Operating income	$	341,576		29,443		13,790		169,720		68,500		81,509		35,662		19			740,219
Identifiable assets at period end	$	2,611,417		192,370		108,985		727,724		376,283		863,840		319,627		(29,329	)		5,170,917
Capital expenditures	$	17,775		2,172		383		933		2,938		4,860		1,354					30,415
Equity	$	1,628,893		35,825		42,670		221,519		124,387		182,515		164,665		(41,304	)		2,359,170
For the nine months ended September 30, 2023:
Revenues	$	2,535,945		326,398		151,994		1,607,788		631,001		1,386,284		386,524		(3,592	)		7,022,342
Directly related cost of transportation and other expenses^1	$	1,387,511		201,984		90,139		1,238,996		437,392		924,592		261,482		(1,700	)		4,540,396
Salaries and other operating expenses^2	$	785,282		108,892		52,172		205,976		132,984		373,004		85,003		(1,902	)		1,741,411
Operating income	$	363,152		15,522		9,683		162,816		60,625		88,688		40,039		10			740,535
Identifiable assets at period end	$	2,572,404		200,711		110,708		512,746		217,018		726,729		260,619		(22,814	)		4,578,121
Capital expenditures	$	15,829		932		360		1,110		744		6,688		2,937		—			28,600
Equity	$	1,797,123		46,264		54,096		225,229		91,712		154,617		161,882		(39,449	)		2,491,474
^1Directly related cost of transportation and other expenses totals Operating Expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.
^2Salaries and other operating expenses totals Salaries and related, Rent and occupancy, Depreciation and amortization, Selling and promotion and Other as shown in the Condensed Consolidated Statements of Earnings.