Hub Group, Inc. (HUBG) Q1 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

of investor relations. I'd like to start by thanking our thousands of team members across North America for their efforts to support our customers and our Hub Group family through this dynamic market. These efforts drove a 40 basis point improvement in operating margins during the quarter and are setting us up for success, both in the current market and long term. Our customers have taken different approaches to managing through the implementation of tariffs, with the majority taking a wait-and-see approach, while others pulled forward inventory depending on their end markets, product types, and origin of their finished goods. It remains unclear what the near and long-term impacts will be as many of our customers have diversified their vendor base and supply chains to ensure fluidity through these potential disruptions. However, this has also created an increased focus for our customers to drive savings in their supply chain, which is supporting over-the-road conversions to intermodal and increasing the pipeline for our consolidation and managed transportation solutions. There will likely be a near-term impact to import volumes to the West Coast, but the magnitude remains uncertain as our volumes have remained steady. We are closely monitoring the situation while staying in constant communication with our clients on their needs. Through this current turbulence in global trade, we are focusing on what we can control, winning profitable growth across all of our segments by leveraging our great service, decreasing costs through our newly implemented $40 million cost reduction program, and maintaining our strong balance sheet, the lower long-term leverage target, giving us flexibility to invest in our business, return capital to shareholders, which total $21 million in t...