ArcBest Q4 adjusted EPS misses estimates as revenue tops expectations | AlphaStreet

ArcBest Company (Nasdaq: ARCB) on Friday reported fourth-quarter 2025 outcomes that underscored the impression of a sustained freight recession on the logistics sector. Whereas the corporate exceeded top-line expectations with income of $972.7 million, its adjusted earnings per share of $0.36 fell in need of the $0.42 consensus estimate, reflecting a 72.9% year-over-year decline in adjusted profitability.

Administration attributed the earnings miss to a shift in freight combine towards heavier, lower-yielding shipments and elevated operational prices. Nevertheless, the report highlighted a major restoration within the firm’s Asset-Gentle phase and the conclusion of practically $24 million in annual financial savings from technology-driven effectivity applications.

Section Efficiency Evaluation

The corporate’s Asset-Based mostly phase, primarily comprised of ABF Freight, reported income of $648.8 million, down 1.1% in comparison with the prior-year interval. Regardless of a 2.4% improve in each day shipments and a 2.6% rise in tonnage—pushed by the profitable onboarding of latest core LTL prospects—working revenue for the phase fell 53.3% to $24.4 million. The phase’s working ratio (OR) deteriorated to 96.2%, up from 92.0% in This fall 2024.

In distinction, the Asset-Gentle phase demonstrated a turnaround in operational effectivity. Whereas income declined 5.1% each day to $353.5 million attributable to decrease market charges, the phase achieved non-GAAP breakeven outcomes, bettering by $6 million year-over-year. This was supported by a 15% discount in SG&A value per cargo and a 19% improve in shipments per particular person per day.

Key Monetary and Operational Metrics

The next desk particulars the year-over-year adjustments for the quarter and the complete fiscal yr:

*2024 Internet Earnings included a $67.9M after-tax profit from a good worth adjustment associated to the MoLo acquisition.

Government Commentary and Strategic Initiatives

Through the earnings name, Seth Runser, President and CEO of ArcBest, emphasised the corporate’s long-term trajectory over present cyclical headwinds.

“2025 was a yr of sturdy execution and significant progress,” Runser acknowledged. “Amid a difficult freight setting, our crew delivered progress in LTL shipments and tonnage, restored profitability in Asset-Gentle, and achieved report productiveness as prospects more and more embraced our built-in, technology-driven options.”

Matt Beasley, Chief Monetary Officer, highlighted the impression of cost-out measures, noting that “phases two and three of Metropolis Route Optimization delivered $2 million in financial savings final yr, bringing the full financial savings from the challenge to $15 million in 2025.” He additionally pointed to the corporate’s disciplined capital allocation, having returned $86 million to shareholders through the yr.

Know-how and Innovation as Progress Drivers

ArcBest has closely leaned into synthetic intelligence to mitigate the impression of the freight downturn.

The corporate reported a number of data-driven milestones:

• AI-Powered Procurement: Enhancements in truckload purchase charges contributed a $2.5 million profit to working revenue in 2025.
• Automation: An AI cellphone agent was utilized by over 23,000 carriers to cowl 7,000 shipments, successfully chopping service name abandonment charges in half.
• Digital Augmentation: Greater than 50% of truckload shipments are actually digitally augmented, with the service portal adoption price rising to 32%.

Sector Context and 2026 Outlook

The outcomes mirror broader industrial tendencies, particularly a “softness in manufacturing and housing markets” famous by Chief Industrial Officer, Eddie Sorg. Whereas January tonnage was up 8%, a simultaneous 8% drop in income per hundredweight highlighted the continuing stress on yields because the business waits for a producing rebound. Trying forward, the corporate supplied a cautious however secure outlook for the primary quarter of 2026. Administration expects the Asset-Based mostly non-GAAP working ratio to extend by 100 to 200 foundation factors sequentially, a determine that’s higher than typical historic seasonality. Capital expenditures for 2026 are projected to be between $150 million and $170 million, down from $198 million in 2025, as the corporate prioritizes effectivity over bodily community growth.

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