(Reuters) – J.B. Hunt Transport Services Inc reported lower-than-expected quarterly earnings on Monday, hurt by weak shipping demand, high driver wages and maintenance expenses.
Shares of trucking operator fell 2.43% to $172.36 in extended trading.
Logistics firms are struggling with excess delivery capacity as demand from e-commerce companies declines from pandemic highs.
Volumes at J.B. Hunt’s intermodal business fell 5%.
The U.S. trucking companies have also been forced to pay higher wages for drivers as they deal with a shortage in the industry.
Major players in the global transportation industry, which was ravaged by supply chain disruptions and port logjams last year, have begun to pursue high-margin customers to help their businesses stay afloat in a rapidly changing economy.
Delivery giants such as FedEx and United Parcel Service have instituted cost control measures to better equip themselves in an unpredictable economy.
Lowell, Arkansas-based J.B. Hunt managed to cut its operating expenses by roughly 6% to $2.95 billion in the first quarter.
The company reported a profit of $1.89 per share for the quarter through March, compared with analysts’ average estimate of $2 per share, as per Refinitiv data.
Its revenue also declined 7.4% to $3.23 billion, short of analysts’ average estimate of $3.40 billion.
(Reporting by Priyamvada C and Pratyush Thakur in Bengaluru; Editing by Shweta Agarwal)
