Hub Group Reports Q2 Revenue Decline Amid Tariff Turmoil
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Hub Group experienced a decline in revenue as it worked to navigate tariff-driven effects on its business in the second quarter of 2025, .
The Oak Brook, Ill.-based intermodal and logistics service provider posted net income of $25 million, or 42 cents a diluted share, for the three months ending June 30. That compared with $29 million, or 47 cents, during the same time the previous year. Total revenue decreased 8.2% to $905.6 million from $986.5 million.
“The second quarter was challenged versus typical seasonality due to the tariff-driven adjustments to shipping patterns,” Hub Group CEO Phil Yeager said during a call with investors. “Our more transactional service lines were impacted less than we anticipated, but we did experience a decline in demand due to slower import volumes near the end of the quarter. Offsetting those headwinds, our contractual services performed well and maintained resiliency.”
Yeager said the consistency of that business is helping Hub maintain a strong balance sheet and steady free cash flow, providing opportunity to reinvest in the business. To that end, the company in late July announced the acquisition of the refrigerated intermodal business from Marten Transport.
“The acquisition allows us to enhance our scale and capacity in one of the highest growth segments of our intermodal network,” Yeager said, stressing that the deal offers Hub an expanded customer base and opportunity for strong returns.
And Hub may not be finished on the deal market. Yeager noted there is a robust pipeline of additional acquisitions, and the company plans to continue to deploy capital towards long-term growth opportunities.
“Through this dynamic environment, we are focused on executing our strategy of delivering best-in-class service at scale, continuously improving our productivity, while investing in high return initiatives,” he said.
Hub is also keeping a close eye on spending.
“We’re also controlling what we can control by implementing our cost reduction program, and thus far, we’ve completed the vast majority of our initial $40 million goal, while identifying additional opportunities for savings and efficiency gains,” Yeager said. “This success is allowing us to raise our target to $50 million of total cost reduction.”
For Q2, the company’s Intermodal and Transportation Solutions segment revenue decreased 5.8% to $528.2 million from $561 million in the prior year. This was due to the intermodal mix, pricing and the impact of fuel, alongside lower dedicated revenue. Operating income increased 5.9% to $14.4 million from $13.6 million the prior year.
Logistics segment revenue decreased 11.9% to $404.3 million from $459.1 million last year. This was due to lower volume and revenue per load in the brokerage business, the exit from unprofitable business in consolidation and fulfillment, and sub-seasonal demand in managed transportation and final mile businesses. Operating income decreased 23% to $19.9 million from $25.9 million.
“As we look ahead, near-term demand trends off the West Coast are strong, and we are seeing indications of an early West Coast peak season. Coupled with several sizable startups in our logistics services, [this] should lead to improving revenue through the remainder of the year,” Yeager said. “It remains unclear how long elevated import demand will persist as we are seeing variances in forecasts by customers. But we believe we are in an excellent position to support our customers.”
Hub Group ranks No. 14 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 20 on the TT Top 100 logistics companies list.
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