J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) reported second-quarter 2025 earnings on July 15, revealing stable revenue of $2.93 billion despite shifting freight dynamics and mounting cost pressures across its business segments.
The Arkansas-based logistics firm saw net income decline to $128.6 million, or $1.31 per diluted share, just below the $135.9 million ($1.32/share) reported a year earlier. Operating income dipped 4% to $197.3 million, with the decline attributed to elevated group medical claims, casualty-related expenses, and higher driver wages and equipment costs.
Intermodal and truckload volumes grew notably—up 6% and 13% respectively—yet those gains were offset by pricing pressures and softer margins, particularly in Final Mile Services and Dedicated Contract Services.
Intermodal: Volume Growth with Yield Pressure
J.B. Hunt’s Intermodal (JBI) segment delivered $1.44 billion in revenue, a 2% year-over-year increase. Load volumes rose to 525,161, with particularly strong performance in the eastern network—up 15%—while transcontinental volumes slipped 1%.
Revenue per load, however, fell 3% to $2,738, primarily due to customer rate adjustments and a changing freight mix. Operating income declined 4% to $95.7 million, constrained by higher maintenance and driver wage costs, even as asset utilization improved.
Dedicated Services: Fewer Trucks, Higher Productivity
Dedicated Contract Services (DCS) revenue remained flat at $847 million, despite a 3% decline in average trucks in service. The fleet averaged 12,689 trucks during the quarter, down from the prior year, yet delivered higher productivity at $5,163 in weekly revenue per truck—up 5% excluding fuel.
The segment’s operating income dropped 3% to $93.7 million due to increased claims costs and rising labor expenses. Net truck count fell by 150 units year-over-year, though recovered by 115 units compared to Q1. Customer retention stayed strong at 92%.
ICS Narrows Losses Despite Volume Drop
Integrated Capacity Solutions (ICS) saw a 4% revenue dip to $260 million as load volumes fell 9% to 132,315. However, revenue per load climbed 6%, and the operating loss narrowed significantly to $3.6 million, improving from a $13.3 million loss in Q2 2024.
The segment benefited from lower personnel costs, leaner operations, and a slight gross profit increase. Gross margins reached 15.5%, up from 14.8% last year. ICS’s carrier base grew by roughly 8%, reaching 117,700 following updates to qualification protocols intended to reduce cargo theft.
Final Mile Services Hit by Demand Weakness
Final Mile Services (FMS) posted a 10% revenue decline to $211 million amid weakening demand across most end markets. Stops fell below the one million mark—at 998,916, down from 1.1 million last year.
Operating income plummeted 60% to $8 million, reflecting not only the revenue shortfall but also elevated claims and bad debt expenses. The prior-year quarter had included $1.1 million in net claim settlement benefits, further skewing the comparison.
Truckload: Load Spike Balances Revenue per Load Drop
Truckload (JBT) revenue increased 5% to $177 million, supported by a double-digit load volume rise to 104,357. However, average revenue per load dropped 7% to $1,696.
Operating income decreased 5% to $3.4 million, held back by higher insurance costs and increased maintenance outlays. The average trailer fleet shrank by 450 units, but improved network balance lifted trailer turns by 17%, enhancing asset productivity.
Financials: Share Buybacks, CapEx, and Debt
J.B. Hunt repurchased 2.4 million shares during the quarter, spending $319 million. Cash and equivalents stood at $51 million as of June 30, with $1.72 billion in outstanding debt. Net capital expenditures totaled $399 million year-to-date.
The effective tax rate for Q2 was 26.9%, and the company anticipates a full-year rate between 24% and 25%.
