Landstar Posts $1.15B in Q1 Revenue Following Fraud-Related Delay

Landstar System Inc. posted first-quarter 2025 earnings on May 13, revealing $1.15 billion in revenue and $29.8 million in net income. The earnings report had been delayed for two weeks due to a supply chain fraud incident, which the company says was isolated to its international freight forwarding operations.

“This fraud matter does not involve our core North American truckload services,” CEO Frank Lonegro told investors. Landstar recorded a $4.8 million pretax charge, equal to $0.10 per share, tied to the incident. Investigations and collection efforts are ongoing.

Revenue Declines Amid Economic Headwinds

The Jacksonville, Florida-based carrier reported a 1.6% decline in quarterly revenue, down from $1.17 billion in Q1 2024. Net income dropped from $47.1 million, or $1.32 per diluted share, to $29.8 million, or $0.85 per share—missing Wall Street expectations of $0.92, according to Zacks.

CEO Lonegro cited soft freight demand, volatile trade conditions, and ongoing inflationary pressure as key factors behind the results. “The 2025 first quarter presented a unique set of macroeconomic challenges,” he said, referencing new federal trade and tariff policies, particularly involving China, Mexico, and Canada.

Roughly 11% of Landstar’s 2024 revenue came from U.S.-Mexico cross-border activity, with another 4% from U.S.-Canada routes.

Load Volumes Exceed Q4 Despite Freight Recession

One positive development: load volumes in Q1 2025 exceeded those in Q4 2024—a rare occurrence for the first quarter, which typically sees lower activity. It marked the first time in 15 years that Q1 loads outpaced the preceding quarter.

Still, total truckload volumes fell 1.2% year-over-year, and revenue per load declined 0.6%.

Segment Performance

• Truck Transportation Revenue: Down 1.8% to $1.05 billion.
  • Van equipment revenue: $595 million (–5.3%)
  • Unsided/platform equipment: $340 million (–0.9%)
  • Power-only services: $92 million (+27.8%)
• Rail, Air, and Ocean Cargo Revenue: Up 7.8% to $83 million.
  • Intermodal rail: $17.5 million (–22.9%)
  • Ocean and air cargo: $65.6 million (+21.4%)

Lonegro noted that some freight activity may have been pulled forward in anticipation of new tariffs, which contributed to the volume uptick.

Looking Ahead

Landstar emphasized that its strategic groundwork laid in 2024 positions the company well once market conditions improve. “Our focus continues to be on accelerating our business model and executing on our strategic growth initiatives,” Lonegro said.

While the outlook remains cautious, the company believes it is structurally prepared to respond once freight demand rebounds and policy uncertainty stabilizes.

Source: Transport Topics