Landstar (NASDAQ:LSTR) Falls Short of Q4 CY2025 Revenue Projections

Landstar (LSTR) Q4 2025 Earnings Overview

Landstar, a freight transportation provider listed on NASDAQ as LSTR, reported fourth-quarter 2025 results that did not meet market expectations. The company’s revenue dropped 3.2% year-over-year to $1.17 billion, falling short of analyst forecasts. Earnings per share based on GAAP came in at $0.70, which was 29.1% below what analysts had anticipated.

Is Landstar a good investment at this point?

Q4 2025 Financial Highlights

• Total Revenue: $1.17 billion, missing analyst expectations of $1.19 billion (down 3.2% year-over-year, 1.6% below estimates)
• GAAP EPS: $0.70, compared to the expected $0.99 (29.1% below consensus)
• Adjusted EBITDA: $40.06 million, versus $66.15 million expected (3.4% margin, 39.4% below estimates)
• Operating Margin: 2.5%, a decrease from 4.8% in the same period last year
• Market Cap: $5.21 billion

Frank Lonegro, Landstar’s President and CEO, commented, “Despite ongoing challenges in the freight market, our team performed admirably in the fourth quarter. Truck transportation revenue remained steady year-over-year, with the overall revenue decline mainly due to lower ocean freight. Our platform equipment services continued to be a strong performer throughout 2025.”

About Landstar

Landstar (NASDAQ:LSTR) operates across North America, specializing in freight logistics and last-mile delivery solutions, covering billions of miles annually.

Revenue Performance

Long-term revenue growth is a key indicator of a company’s strength. While some businesses may post strong results for a few quarters, sustained growth over years is a sign of quality. Over the past five years, Landstar’s sales increased at a modest 2.8% compound annual rate, which falls short of high-performance benchmarks and sets a challenging context for evaluation.

Landstar Quarterly Revenue

At StockStory, we prioritize long-term growth, but in the industrial sector, five-year trends can sometimes overlook industry cycles or significant company events. Landstar’s revenue rose in previous years but has declined by an average of 5.4% annually over the last two years. This pattern mirrors a broader downturn in the Ground Transportation sector, where many peers have also seen sales drop.

Landstar Year-On-Year Revenue Growth

Breaking down revenue by segment, Van Equipment and Platform Equipment account for 47.6% and 34.1% of total revenue, respectively. Over the past two years, Van Equipment revenue (full truckload van transport) has declined by an average of 7.6% annually, while Platform Equipment revenue (full truckload trailer transport) has grown by 1.4% per year.

Landstar Quarterly Revenue by Segment

This quarter, Landstar’s revenue fell 3.2% year-over-year to $1.17 billion, missing Wall Street’s expectations.

Looking forward, analysts predict Landstar’s revenue will rise 6.8% over the next year. While this suggests improvement from new offerings, it still lags behind the industry average.

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Profitability and Margins

Operating margin is a crucial metric for assessing profitability, reflecting how much profit remains after all core business expenses. Over the last five years, Landstar maintained profitability but struggled with high costs, averaging a 6.3% operating margin—relatively weak for its sector. This is partly due to its low gross margin foundation.

Landstar Trailing 12-Month Operating Margin (GAAP)

Over the past five years, Landstar’s operating margin shrank by 4.5 percentage points. Ideally, revenue growth should have improved margins through better cost leverage, but rising expenses outpaced revenue gains. This trend is common among Ground Transportation companies during industry downturns, but Landstar’s margin contraction was particularly pronounced, indicating it was unable to offset higher costs through pricing.

In the fourth quarter, Landstar’s operating margin was 2.5%, down 2.2 points from the previous year. The sharper decline in gross margin compared to operating margin suggests that inefficiencies were mainly due to increased cost of sales, rather than higher spending on marketing, R&D, or administration.

Earnings Per Share (EPS) Trends

While revenue growth tells part of the story, changes in earnings per share (EPS) reveal how profitable that growth is. A company might boost sales through heavy marketing, but sustainable profit growth is key.

Unfortunately, Landstar’s EPS has dropped by an average of 7.9% per year over the last five years, even as revenue grew by 2.8%. This indicates declining profitability per share, likely due to factors such as higher interest expenses and taxes.

Landstar Trailing 12-Month EPS (GAAP)

A closer look at Landstar’s earnings shows that the main driver of lower EPS was the 4.5-point drop in operating margin, rather than external factors like taxes or interest costs.

Recent trends are also concerning: over the past two years, Landstar’s EPS has fallen by 33% annually, highlighting ongoing underperformance.

For Q4, EPS was $0.70, down from $1.31 a year earlier and below analyst expectations. However, Wall Street forecasts a 64% increase in full-year EPS to $3.31 over the next 12 months.

Summary and Outlook

Landstar exceeded expectations in Platform Equipment revenue this quarter, but missed on Van Equipment and EBITDA, resulting in a mixed overall performance. Following the report, shares dropped 2% to $150.23.

While this quarter’s results were underwhelming, investors considering Landstar should weigh its valuation, business fundamentals, and the latest earnings data.