C. H. ROBINSON WORLDWIDE, INC. Q1 FY2025 earnings call

• The company executed strategies from Investor Day to take market share and expand margins, outgrowing the market in NAST's truckload and LTL in Q1 while expanding gross and operating margins.
• Global Forwarding continued to win new business and optimize expenses.
• Innovation with artificial intelligence and automation was emphasized to elevate customer and carrier experience, drive gross margin, and operating leverage.
• Operational discipline and productivity initiatives increased operating leverage, with personnel expenses down due to productivity and cost optimization efforts, and SG&A expenses also reduced excluding certain charges.

In North American Surface Transportation (NAST), the team outgrew the market in both truckload and LTL in Q1, with volume down 1% year-over-year (YOY) but up 2% sequentially. Truckload volume was down 4.5% YOY and up 3.5% sequentially, while LTL volume grew 1% YOY and 1.5% sequentially. NAST expanded gross margins by 140 basis points YOY, with an operating margin of 34.3% in Q1, up both YOY and sequentially. In Global Forwarding, the business continued to win new business and optimize expenses, with AGP up 2.5% YOY. NAST contributed $15.4M of the $15.4M year-over-year increase in enterprise Q1 income from operations, with a 5.3% increase in NAST AGP and 2.5% increase in Global Forwarding AGP.

• Full-year 2025 personnel expenses are expected to be $1.375 billion to $1.475 billion, with headcount relatively flat.
• 2025 SG&A expenses are expected to be $575 million to $625 million, including depreciation and amortization of $95 million to $105 million.
• Full-year capital expenditures are now expected to be $65 million to $75 million, down from the previous guidance of $75 million to $85 million.
• The company returned $175 million to shareholders in Q1 through share repurchases and dividends.

• Market uncertainty due to new tariffs and fluid trade policies causing customers to adopt a wait-and-see approach, leading to Ocean bookings out of China declining in Q2.
• Volatility in weather and short-term events impacting the trucking market, which can have outsized impacts on short-term pricing and market conditions.

Q: Alex Johnson asks about weather impact in March A: Dave Bozeman and Michael Castagnetto discuss weather impact and how the operating model helps react to such events Q: Jeff Kauffman asks about Trans-Pacific and Southeast Asia diversification A: Arun Rajan talks about customer diversification away from specific trade lanes and customs activity growth Q: Brian Ossenbeck asks about April outlook and capacity exit A: Dave Bozeman and Michael Castagnetto discuss seasonality and capacity exit trends in the trucking market Q: Ken Hoexter asks about AGP deceleration and CapEx A: Damon Lee and Dave Bozeman discuss comps and CapEx reprioritization Q: Tom Wadewitz asks about headcount and RMS integration A: Dave Bozeman and Michael Castagnetto discuss headcount dynamics and RMS combination value proposition Q: Bascome Majors asks about tech project progress A: Arun Rajan and Dave Bozeman talk about productivity improvements and continuous innovation Q: Chris Wetherbee asks about positioning for soft import A: Dave Bozeman discusses levers and workforce management in response to soft import conditions