C.H. Robinson Hits Margin Targets While Continuing to Cut Jobs
Key Takeaways
- •Adjusted operating margin increased 360 basis points year over year to 34.7%.
- •Second-quarter revenue climbed 19.3% to $4.9 billion, mainly on higher pricing across several service lines.
- •Gross profit rose 2.7% to $1.4 billion, showing profitability lagged the revenue increase.
- •Performance varied by segment, with LTL and air stronger while truckload, ocean and customs declined in adjusted gross profit.
- •The company said its Lean AI strategy helped reduce waste and support productivity gains, and its earnings and revenue both topped Wall Street expectations.
C.H. Robinson (NASDAQ: CHRW) said in its earnings report that the 3PL reached its mid-cycle operating margin targets “while the freight market is still in the trough of the demand cycle.”
The company said adjusted operating margin rose 360 basis points from the same quarter a year earlier to 34.7%. Adjusted gross profit increased 6.5% year over year to $738 million.
At North American Surface Transport, which contains the company’s core brokerage operations, adjusted operating margin was 40.9%, while adjusted gross profit rose 8.6% from a year earlier.
Total revenue increased 19.3% to $4.9 billion, “primarily driven by higher pricing in our truckload, less than truckload (“LTL”), air and ocean services,” the company said in its earnings statement released Wednesday afternoon.
The large increase in revenue did not translate into a comparable rise in profitability. Higher freight rates can lift revenue quickly, but for 3PLs they can also create pressure when contract freight is covered by more expensive spot capacity.
As a result, gross profit rose only 2.7% to $1.4 billion. Adjusted gross profit, a non-GAAP measure, increased 2.4%, “primarily driven by higher adjusted gross profit per transaction in our LTL and air services.”
Performance across business lines was mixed. Truckload adjusted gross profit fell 1.4% from a year earlier, while LTL adjusted gross profit rose 21.8%. Air posted a 22.9% increase in adjusted gross profit. Ocean declined 2.7%, and Customs fell 9.4%.
Revenue at $CHRW in the second quarter was up 19.3% year-on-year. And here’s what the headcount did: it is down 10.8% for the company as a whole during that time. Since CEO Dave Bozeman took over mid-2023, headcount is down about 28.7%. pic.twitter.com/6aDdbMqHVZ — John Kingston (@JohnHKingston) July 29, 2026
Job reductions continued in the quarter. In his remarks in the earnings statement, CEO Dave Bozeman again pointed to the company’s “Lean AI strategy,” which he said has enabled C.H. Robinson “to identify and remove waste and to automate manual processes in the quote-to-case lifecycle of an order.”
“The result has been evergreen productivity improvements of over 60% since the end of 2022 in both NAST and Global Forwarding,” Bozeman said. “The execution of our strategy has also enabled us to build a scalable model with significant operating leverage, which contributed to the 20% year-over-year increase in our adjusted operating income.”
According to SeekingAlpha, C.H. Robinson’s non-GAAP EPS of $1.61 beat Wall Street consensus estimates by 9 cents. Revenue of $4.93 billion beat forecasts by $580 million.
The company’s stock, which in recent years has often seen sharp aftermarket moves after earnings releases, was up less than 1% at approximately 5:15 p.m. EDT.