C.H. Robinson Worldwide, Inc.: Solid 2Q Despite GM% Pressure; Legal Issues / Visibility Will Take Time

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C.H. Robinson Worldwide, Inc.: Solid 2Q Despite GM% Pressure; Legal Issues / Visibility Will Take Time

Forwarding is Benefitting from Stronger Air Rates

In Figure 3 below we look at Forwarding gross profit on a y/y basis. CHRW’s Global

Forwarding total adjusted gross profit increased +0.7% y/y to $188.8 mm in 2Q26, close

to our +1.1% estimate, as strong Air performance offset softer Ocean and Customs

results. Air adjusted gross profit increased 23.4% y/y, with the company citing supply-

side constraints and global disruptions that drove higher air freight rates, while a 33.5%

increase in AGP per metric ton more than offset a 7.5% decline in metric tons shipped.

Ocean was a modest drag, with AGP down 2.8% y/y as a 4.0% decline in AGP per

shipment more than offset a 1.0% increase in shipments. We note that GM% in Global

Forwarding deteriorated by ~250 bp y/y, which was likely due to an increase in ocean

and air capacity costs.

Figure 3: Global Forwarding Gross Profit Y/Y Change

Y/Y

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Source: Company Reports, UBS

Key Model Assumptions For CHRW Post 2Q Results

In Figure 4 below, we include our key model assumptions for CHRW following the 2Q

print. Our full year 2026E EPS increases to $6.22 vs our prior $6.18. For the full year

2026, we are modelling a -0.5% Y/Y Truckload volume decrease and 21.6% Y/Y base

pricing, while our Forwarding gross profit is modelled at -3.2% due to weak ocean

shipping rates. We believe the brokerage cycle may be in the process of bottoming,

although it is unclear how a sustained recovery will evolve. For 2027, our EPS estimate

remains unchanged at $8.20. Drivers of our 2027E EPS include 9.0% Truckload Y/Y base

pricing, while our Forwarding gross revenue estimate is increasing 4.0%.