Dive Brief:
- J.B. Hunt Transport Services revenue dropped 5% to $3.15 billion in Q4, while its operating income ticked slightly upward in the quarter, according to an earnings release Thursday.
- That came as the company’s brokerage unit, Integrated Capacity Solutions, posted a $21.8 million loss. That setback, however, was better than the segment’s performance in Q4 2023 when it had a $24.9 million loss.
- “A focus and a top priority for our leaders in the company is to get us on a path to repair and improve our financial performance,” President and CEO Shelley Simpson said on an earnings call.
Dive Insight:
At or near the end of what Intermodal President and EVP Darren Field described as the worst freight recession in company history, J.B. Hunt’s overall operating income inched up 2% for Q4 to $207 million but decreased by 16% for the full year, the company reported.
The carrier was dissatisfied with its performance, Simpson told investors, adding there’s still work to be done in the brokerage segment. But J.B. Hunt’s intermodal segment saw two record quarters of volume in the back half of 2024, she and other executives added.
“Demand trends for our intermodal service were seasonally strong during the quarter, particularly on eastbound loads out of Southern California,” the company said in an earnings presentation. Intermodal volume was up 5% in Q4 2024 YoY.
In April, the carrier reported that its commitment to its people, technology and capacity meant it had approximately $100 million in resources and capacity that were beyond its current business needs. But it was preparing itself for long-term growth.
Since then, its extra capacity was costing J.B. Hunt around $60 million as the company reduced its headcount through attrition and performance management, bringing staffing to approximately 12% below peak levels, CFO and EVP John Kuhlow said Thursday on the earnings call.
The company strategically held onto people and capacity through the freight recession while making “some bold investments, like acquiring the intermodal assets from Walmart,” Simpson said.
Overall, the carrier drastically clamped down on capital expenditures in 2024, spending approximately $674 million in the year, compared to $1.6 billion in 2023.
“While market dynamics remain uncertain around the timing and magnitude of a potential inflection, our focus in 2025 is to grow and begin to repair our margins,” Simpson said. “We will be coming out of the freight recession from a position of strength.”
