Expeditors Q2 2026 revenue rose 32% to $3.50B and EPS 51% to $2.03, driven by AI-server airfreight (tonnage +14%, rates +44%) and tariff-driven customs work, while ocean net revenue fell 7%.
Revenue
$3.5B
+32.1% YoY
Net income
$266M
+45.0% YoY
Diluted EPS
$2.03
+51.5% YoY
Operating margin
10.0%
Overview
Expeditors International of Washington (EXPD) had one of its strongest quarters in years in Q2 2026, which ended June 30. Revenue rose 32% to $3.50 billion. Operating income rose 41% to $349.6 million, and diluted EPS rose 51% to $2.03. Two things drove it. First, AI-infrastructure shipments from technology customers pushed airfreight volume and prices sharply higher. Second, the shifting US tariff rules made customs clearance more complicated, so more customers needed brokers and paid higher fees. Ocean freight was the weak spot: it earned less money than a year earlier even though its revenue grew.
Expeditors doesn't own planes or ships. It buys cargo space from airlines and shipping lines in bulk and resells it to shippers, and it clears goods through customs. So the headline "revenue" figure mostly reflects carrier prices that are passed through to customers. That is why the most useful number is net revenue: revenue minus the directly related cost of transportation, meaning what Expeditors keeps after paying the carriers. The 10-Q doesn't label a single "net revenue" line. The net revenue figures below are our own subtraction of each service's "directly related cost of transportation and other expenses" from its revenue, both taken from the 10-Q's income statement.
Key metrics
Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$3,502.3M
$2,651.9M
+32.1%
Net revenue (revenue less directly related costs)
$1,085.5M
$898.5M
+20.8%
Operating income
$349.6M
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Operating margin here means operating income divided by revenue, i.e. the share of revenue left after running the business, before interest and tax. For a forwarder, gross revenue swells or shrinks with carrier prices, so operating income as a share of net revenue is the better measure of efficiency. By our calculation that ratio was 32.2%, the same "operating efficiency" figure CFO David Hackett cited in the Q2 earnings release (8-K Exhibit 99.1, August 4, 2026). The tonnage, container-volume and headcount figures also come from that release.
First half of 2026 (six months): revenue $6,285.3M (+18.2%), net revenue $2,057.3M (+15.0%), operating income $644.4M (+25.5%), net earnings attributable to shareholders $495.8M (+28.0%), diluted EPS $3.74 vs. $2.82 (+32.6%). Operating income was 31.3% of net revenue, up from 28.7%.
What drove each business
Service (Q2)
Revenue
YoY
Net revenue
Net revenue Q2 2025
YoY
Airfreight
$1,494.8M
+57%
$360.1M
$253.4M
+42.1%
Ocean freight & ocean services
$710.9M
+5%
$179.0M
$192.3M
-6.9%
Customs brokerage & other services
$1,296.6M
+27%
$546.4M
$452.8M
+20.7%
Total
$3,502.3M
+32%
$1,085.5M
$898.5M
+20.8%
Airfreight: more volume and much higher prices
Per the 10-Q, airfreight revenue rose 57% "due to 44% and 45% increases in average sell and buy rates, respectively, and a 14% increase in tonnage." The sell rate is what Expeditors charges customers and the buy rate is what it pays airlines. The filing says tonnage grew mainly on exports from North and South Asia "as demand from technology customers remained strong." It says buy rates rose because "the conflict in the Middle East constrained available capacity and jet fuel prices soared." In the earnings release, management added that tonnage was up 16% from Q1 2026. It said "heavy demand from AI hyperscalers shows no sign of slowing down," and that some hyperscalers now need main-deck freighter space for their servers.
Air net revenue rose 42%, less than air revenue's 57%, because buy rates rose slightly faster than sell rates. Air net revenue as a share of air revenue slipped from 26.6% to 24.1%. That is normal when carrier prices spike: Expeditors makes more dollars per kilo but a thinner percentage. Tonnage rose every month of the quarter (+13% April, +14% May, +15% June), so this is not a single-month blip.
Ocean: revenue up, profit down
Ocean revenue rose 5% but ocean net revenue fell about 7%. In ocean freight consolidation, the largest ocean product, revenue rose 3% while costs rose 10%, "primarily due to 3% and 10% increases in average sell and buy rates, while ocean containers shipped remained flat." The 10-Q says buy-rate increases "outpaced our ability to pass through higher sell rates during the quarter, as a result of timing and our buy rate mix." Here the headline and the underlying profit point in opposite directions. The positive sign is late in the quarter: container volume went from -9% year on year in April to +9% in June. The release says volume was up 7% from Q1, "the first sequential increase since the third quarter of 2025," and that per-container profitability improved. South Asia ocean revenue rose 15%, while North Asia fell 4%. Order management revenue rose 21%.
For the first half, ocean revenue was down 10% and ocean net revenue down about 9.5%. Most of that damage came in Q1, when the 10-Q says available ship capacity exceeded demand.
Customs brokerage and other services: tariffs are good for this business
This segment rose 27% (net revenue +20.7%), and it is now Expeditors' largest source of net revenue at about half the total. The 10-Q attributes the growth to "increases in the number and complexity of customs clearances, road freight and warehousing and distribution." It adds that the "dynamic trade environment has resulted in higher fees and growing demand for our brokerage services." North America revenue in this segment rose 33% and Europe 14%.
The tariff backdrop is unusual. On February 20, 2026, the US Supreme Court struck down the tariffs imposed in 2025 under the International Emergency Economic Powers Act (IEEPA), and starting in April US Customs set up a process for importers to claim refunds. Per the earnings release, "a temporary surge in IEEPA-related filings drove higher pricing." That part of the growth should not be expected to repeat once the refund claims are processed. The 10-Q also warns: "Should international trade slow or there is substantial removal of tariffs, our revenues and operating income could be negatively impacted." Tariffs haven't gone away, though. The 10-Q notes new US tariffs "broadly imposed across a variety of countries in July 2026," which keeps the paperwork complicated.
Costs, one-off items and the path to EPS
Salaries rose 22% to $573.7M. The 10-Q cites a 4% increase in headcount, higher base pay, bigger incentive bonuses on higher profit, and a $25 million restructuring charge for cutting jobs in the Global Technology group. Excluding that charge, salaries rose about 16%, still less than net revenue's 21%.
Other expenses fell 10%, mainly because of a $16 million gain on the sale of a property. Taken together, the restructuring charge and the property gain reduced pre-tax profit by roughly $9M, so underlying operating income was slightly better than the reported $349.6M.
Tax rate fell to 25.4% from 28.7%. The 10-Q attributes this to fewer non-deductible foreign expenses and lower expense from operations in countries with tax rates above the US rate. This is why net earnings (+45%) grew faster than operating income (+41%).
Share count: diluted weighted shares fell 3.8% to 131.4M. That is why EPS (+51.5%) grew faster than net earnings (+45%).
Cash and shareholder returns
Expeditors has no long-term debt. It ended June with $1,031M in cash. Operating cash flow was $179M in the quarter, the same as a year earlier, because more business ties up more cash in customer receivables. The company returned $461M in the quarter: $354.9M in share buybacks (2.3M shares at an average $151.50) and $105.8M in dividends. It paid a semi-annual dividend of $0.81 per share, up from $0.77. In the first half it bought back 4.3M shares, and shares outstanding fell from 133.9M at the end of 2025 to 130.0M on June 30. The company plans about $60M of capital spending in 2026.
Takeaway: Expeditors' growth this quarter came from two businesses: airfreight (+42% net revenue, driven by AI-server shipments and Middle East capacity shortages) and customs/brokerage (+21%, driven by tariff complexity and a temporary rush of IEEPA refund filings). Both depend partly on conditions that could ease. Ocean, the one business tied to ordinary trade volume, still earned less than a year ago. The unusually high air rates and the one-time refund-filing surge mean Q2 is a high base to repeat.
Outlook
Expeditors does not give numerical revenue or earnings guidance. What management did say, per the earnings release:
The Global Technology restructuring is expected to lower the cost structure by about $50 million a year, "nearly 10% of our total corporate overhead expenses." About $2M of the ~$27M total charge remains for the second half (per the 10-Q). Most of the headcount reduction will show up in Q3, since Q2 headcount was "essentially flat" vs. Q1.
The CFO said "our pipeline of new business is very strong."
An Investor Day is scheduled for November 18, 2026, in New York.
Our read: Historically Q3 and Q4 are Expeditors' strongest quarters (per the 10-Q). The Q3 setup looks favorable: rising ocean volumes by June, $50M-a-year savings starting to arrive, and continued AI-related air demand. The risks are specific. Air rates are "highly elevated" because of the Middle East conflict and fuel costs, and if capacity comes back, airfreight revenue could fall even while volumes hold. Part of the customs strength came from IEEPA refund filings that management itself calls temporary. Carriers are also adding new ships in 2026–27, which could push ocean rates down again. In Q3, check whether airfreight tonnage keeps growing (not just prices), whether ocean net revenue returns to growth, and whether operating income stays above 30% of net revenue after the restructuring savings arrive.