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C.H. Robinson's profits beat quarterly estimates due to cost control and weak freight demand

C.H. Robinson's fourth-quarter profit was above Wall Street expectations on Wednesday as cost control helped the global freight forwarder to mitigate the impact of a weak demand in a challenging international trade environment. In aftermarket trading, shares of?the company? rose 6.3%.

The largest U.S. Freight Broker reported a 5% drop in operating costs for the quarter. Personnel expenses, other selling, administrative and general costs all fell by about?5%. The average number of employees fell by 12.9% during the fourth quarter.

C.H. Robinson has increasingly used artificial intelligence to streamline operations and reduce manual processes. This shift is occurring as the U.S. freight market struggles with muted shipments and excess capacity. These factors are pushing up rates and forcing logistics companies to reduce costs. The fourth quarter was a difficult macro-environment, as weak global freight demand, increasing spot costs for trucking, and declining ocean rates were all headwinds. CEO Dave Bozeman stated. Global Forwarding, the company's freight forwarding division, reported a 17.3% drop in revenue for the quarter to $730.98 millions.

The company's total revenue dropped 6.5%, to $3.9 billion. This was further affected by the sale of its Europe Surface Transportation division, as well as lower prices and volumes for ocean and truckload service. LSEG data shows that cost control helped the company achieve a profit adjusted for the quarter at $1.23, which was higher than analysts' estimates of $1.12, according to LSEG. Reporting by Abhinav Paramar and Apratim Sakar in Bengaluru, Editing by Shreya Biwas and Leroy Leo

(source: Reuters)