J.B. Hunt still waiting for market to turn

Todd Maiden

Tue, Jul 15, 2025, 4:21 PM 4 min read

J.B. Hunt Transport Services remains focused on improving its freight profile and removing costs as it awaits a positive inflection in demand.

The Lowell, Arkansas-based company reported earnings per share of $1.31 for the second quarter, which was largely in line with analysts’ expectations and flat year over year.

Consolidated revenue of $2.93 billion was also flat y/y and in line with the consensus estimate. Operating income slid 4% to $197 million but margins have largely stabilized across its various business units.

The multimodal transportation provider has identified $100M in cost takeouts, which include a variety of efficiency and asset utilization improvement initiatives. Some of the reductions will be realized this year with the bulk occurring next year.

J.B. Hunt’s (NASDAQ: JBHT) intermodal revenue increased 2% y/y to $1.44 billion as loads increased 6% and revenue per load fell 3%. A 15% jump in loads originating in the East weighed on the yield metric given a shorter length of haul. Transcontinental loads were down 1% in the quarter. By month, loads were up 11% y/y in April, 3% in May and 4% in June.

By comparison, total intermodal traffic on the U.S. Class I railroads was up 2% y/y (container-only traffic was up 3%) during the quarter, according to the Association of American Railroads.

The choppiness in load trends during the quarter was largely due to changing customer behaviors in reaction to the trade war.

Some of J.B. Hunt’s customers have pulled freight shipments forward while others have not. Other customers have changed where they source their goods, away from countries that are likely to see punitive tariffs from the U.S. The changes in customer demand pushed J.B. Hunt to pull forward its peak season surcharge programs this year.

During the recent intermodal bid season, the company captured positive rate increases for the first time in two years. However, positive pricing in head haul lanes, was partially offset by pricing weakness in back haul lanes. While management was hopeful for bigger rate increases, it said the modest increases it received along with a reduction in its cost profile has allowed it to stabilize margins in the unit.

The unit’s operating ratio (inverse of operating margin) deteriorated 40 basis points y/y to 93.3%. The result was 30 bps better than the first quarter.

Dedicated revenue dipped less than 1% y/y to $847 million as a 3% decline in average trucks in service was largely offset by a 3% increase in revenue per truck per week (up 5% excluding fuel surcharges).