Freight delivery company Landstar (NASDAQ:LSTR) fell short of the markets revenue expectations in Q4 CY2025, with sales falling 3.2% year on year to $1.17 billion. Its GAAP profit of $0.70 per share was 29.1% below analysts’ consensus estimates.

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Revenue: $1.17 billion vs analyst estimates of $1.19 billion (3.2% year-on-year decline, 1.6% miss)

EPS (GAAP): $0.70 vs analyst expectations of $0.99 (29.1% miss)

Adjusted EBITDA: $40.06 million vs analyst estimates of $66.15 million (3.4% margin, 39.4% miss)

Operating Margin: 2.5%, down from 4.8% in the same quarter last year

Market Capitalization: $5.21 billion

“The Landstar team of independent business owners and employees performed well during the 2025 fourth quarter despite continued tough macro demand conditions in the freight transportation market. In fact, fourth quarter truck transportation revenue was nearly flat year over year, as the decrease in total revenue was primarily attributable to decreased ocean revenue. Our services hauled by unsided/platform equipment, a real bright spot for Landstar throughout 2025, continued to demonstrate sustained strength in the fourth quarter,” said Landstar President and Chief Executive Officer Frank Lonegro.

Covering billions of miles throughout North America, Landstar (NASDAQ:LSTR) is a transportation company specializing in freight and last-mile delivery services.

A company’s long-term sales performance is one signal of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last five years, Landstar grew its sales at a sluggish 2.8% compounded annual growth rate. This fell short of our benchmarks and is a tough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Landstar’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 5.4% annually. Landstar isn’t alone in its struggles as the Ground Transportation industry experienced a cyclical downturn, with many similar businesses observing lower sales at this time.

We can dig further into the company’s revenue dynamics by analyzing its most important segments, Van Equipment and Platform Equipment, which are 47.6% and 34.1% of revenue. Over the last two years, Landstar’s Van Equipment revenue (full truckload van transportation) averaged 7.6% year-on-year declines. On the other hand, its Platform Equipment revenue (full truckload trailer transportation) averaged 1.4% growth.

This quarter, Landstar missed Wall Street’s estimates and reported a rather uninspiring 3.2% year-on-year revenue decline, generating $1.17 billion of revenue.

Looking ahead, sell-side analysts expect revenue to grow 6.8% over the next 12 months. Although this projection indicates its newer products and services will fuel better top-line performance, it is still below average for the sector.

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Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.

Landstar was profitable over the last five years but held back by its large cost base. Its average operating margin of 6.3% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.

Looking at the trend in its profitability, Landstar’s operating margin decreased by 4.5 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. We’ve noticed many Ground Transportation companies also saw their margins fall (along with revenue, as mentioned above) because the cycle turned in the wrong direction, but Landstar’s performance was poor no matter how you look at it. It shows that costs were rising and it couldn’t pass them onto its customers.

In Q4, Landstar generated an operating margin profit margin of 2.5%, down 2.2 percentage points year on year. Since Landstar’s gross margin decreased more than its operating margin, we can assume its recent inefficiencies were driven more by weaker leverage on its cost of sales rather than increased marketing, R&D, and administrative overhead expenses.

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Sadly for Landstar, its EPS declined by 7.9% annually over the last five years while its revenue grew by 2.8%. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

Diving into the nuances of Landstar’s earnings can give us a better understanding of its performance. As we mentioned earlier, Landstar’s operating margin declined by 4.5 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Landstar, its two-year annual EPS declines of 33% show it’s continued to underperform. These results were bad no matter how you slice the data.

In Q4, Landstar reported EPS of $0.70, down from $1.31 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects Landstar’s full-year EPS of $3.31 to grow 64%.

We were impressed by how significantly Landstar blew past analysts’ Platform Equipment revenue expectations this quarter. On the other hand, its Van Equipment revenue missed and its EBITDA fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 2% to $150.23 immediately after reporting.

Landstar didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free.