expd-10q_20220630.htm

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At August 1, 2022, the number of shares outstanding of the issuer’s common stock was 163,595,482.

	June 30, 2022			December 31, 2021
Assets:
Current Assets:
Cash and cash equivalents	$	1,976,971		$	1,728,692
Accounts receivable, less allowance for credit loss of $7,636 at June 30, 2022 and $6,686 at December 31, 2021		3,469,833			3,810,286
Deferred contract costs		745,577			987,266
Other		137,768			108,801
Total current assets		6,330,149			6,635,045
Property and equipment, less accumulated depreciation and amortization of $554,252 at June 30, 2022 and $541,677 at December 31, 2021		495,328			487,870
Operating lease right-of-use assets		491,630			459,158
Goodwill		7,927			7,927
Deferred federal and state income taxes, net		19,413			729
Other assets, net		16,695			19,200
Total assets	$	7,361,142		$	7,609,929
Liabilities:
Current Liabilities:
Accounts payable		1,914,979			2,012,461
Accrued liabilities, primarily salaries and related costs		473,644			403,625
Contract liabilities		867,467			1,142,026
Current portion of operating lease liabilities		88,112			82,019
Federal, state and foreign income taxes		66,864			86,166
Total current liabilities		3,411,066			3,726,297
Noncurrent portion of operating lease liabilities		414,813			385,641
Commitments and contingencies		—			—
Shareholders’ Equity:
Preferred stock, none issued		—			—
Common stock, par value $0.01 per share. Issued and outstanding: 162,931 shares at June 30, 2022 and 167,210 shares at December 31, 2021		1,629			1,672
Additional paid-in capital		137			3,160
Retained earnings		3,717,316			3,620,008
Accumulated other comprehensive loss		(193,834	)		(130,414	)
Total shareholders’ equity		3,525,248			3,494,426
Noncontrolling interest		10,015			3,565
Total equity		3,535,263			3,497,991
Total liabilities and equity	$	7,361,142		$	7,609,929

	Three months ended June 30,				Six months ended June 30,
	2022		2021		2022		2021
Revenues:
Airfreight services	$	1,602,566	$	1,523,569	$	3,201,121	$	2,849,484
Ocean freight and ocean services		1,759,646		1,098,550		3,735,892		2,052,462
Customs brokerage and other services		1,241,100		986,974		2,330,597		1,905,967
Total revenues		4,603,312		3,609,093		9,267,610		6,807,913
Operating Expenses:
Airfreight services		1,212,503		1,136,328		2,355,049		2,090,872
Ocean freight and ocean services		1,402,365		862,251		3,002,608		1,604,686
Customs brokerage and other services		826,080		600,054		1,599,402		1,150,359
Salaries and related		508,222		481,186		1,047,162		933,291
Rent and occupancy		51,598		45,366		102,526		90,646
Depreciation and amortization		14,254		12,675		27,229		25,662
Selling and promotion		5,887		3,172		9,935		6,242
Other		76,421		57,416		155,957		109,995
Total operating expenses		4,097,330		3,198,448		8,299,868		6,011,753
Operating income		505,982		410,645		967,742		796,160
Other Income (Expense):
Interest income		2,720		2,188		4,612		4,134
Other, net		106		2,649		7,633		5,649
Other income, net		2,826		4,837		12,245		9,783
Earnings before income taxes		508,808		415,482		979,987		805,943
Income tax expense		126,582		98,508		248,281		201,019
Net earnings		382,226		316,974		731,706		604,924
Less net earnings attributable to the noncontrolling interest		4,421		602		7,792		1,332
Net earnings attributable to shareholders	$	377,805	$	316,372	$	723,914	$	603,592
Diluted earnings attributable to shareholders per share	$	2.27	$	1.84	$	4.31	$	3.52
Basic earnings attributable to shareholders per share	$	2.29	$	1.87	$	4.35	$	3.57
Weighted average diluted shares outstanding		166,474		171,677		167,980		171,660
Weighted average basic shares outstanding		165,092		169,210		166,423		169,140

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022			2021
Net earnings	$	382,226		$	316,974	$	731,706		$	604,924
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments, net of income tax (benefit) expense of $(6,281) and $221 for the three months ended June 30, 2022 and 2021 and $(7,781) and $(3,172) for the six months ended June 30, 2022 and 2021.		(56,750	)		9,159		(64,762	)		(7,038	)
Other comprehensive (loss) income		(56,750	)		9,159		(64,762	)		(7,038	)
Comprehensive income		325,476			326,133		666,944			597,886
Less comprehensive income attributable to the noncontrolling interest		4,076			341		6,450			607
Comprehensive income attributable to shareholders	$	321,400		$	325,792	$	660,494		$	597,279

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Operating Activities:
Net earnings	$	382,226		$	316,974		$	731,706		$	604,924
Adjustments to reconcile net earnings to net cash from operating activities:
Provisions for losses on accounts receivable		4,763			1,090			4,347			2,289
Deferred income tax (benefit) expense		(8,622	)		1,850			(11,858	)		10,001
Stock compensation expense		25,518			30,909			37,121			42,094
Depreciation and amortization		14,254			12,675			27,229			25,662
Other, net		(1,746	)		346			(1,291	)		897
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable		378,291			(410,783	)		245,943			(663,697	)
(Decrease) increase in accounts payable and accrued expenses		(133,171	)		99,944			7,020			333,182
Decrease (increase) in deferred contract costs		37,138			(150,382	)		211,068			(221,640	)
(Decrease) increase in contract liabilities		(45,574	)		174,504			(238,931	)		254,094
Decrease in income taxes payable, net		(93,430	)		(47,994	)		(47,171	)		(1,356	)
(Increase) decrease in other, net		(1,001	)		1,164			7,409			(324	)
Net cash from operating activities		558,646			30,297			972,592			386,126
Investing Activities:
Purchase of property and equipment		(38,158	)		(6,539	)		(52,570	)		(14,930	)
Other, net		(134	)		138			(55	)		104
Net cash from investing activities		(38,292	)		(6,401	)		(52,625	)		(14,826	)
Financing Activities:
Proceeds from borrowing on lines of credit, net		28,571			174			48,061			89
Proceeds from issuance of common stock		5,682			22,711			11,433			42,468
Repurchases of common stock		(549,065	)		(62,472	)		(549,065	)		(148,469	)
Dividends paid		(109,828	)		(98,387	)		(109,828	)		(98,387	)
Payments for taxes related to net share settlement of equity awards		(11,851	)		(13,893	)		(19,333	)		(15,168	)
Net cash from financing activities		(636,491	)		(151,867	)		(618,732	)		(219,467	)
Effect of exchange rate changes on cash and cash equivalents		(46,518	)		8,699			(52,956	)		(5,503	)
Change in cash and cash equivalents		(162,655	)		(119,272	)		248,279			146,330
Cash and cash equivalents at beginning of period		2,139,626			1,793,393			1,728,692			1,527,791
Cash and cash equivalents at end of period	$	1,976,971		$	1,674,121		$	1,976,971		$	1,674,121
Taxes Paid:
Income taxes	$	236,791		$	143,959		$	314,751		$	190,536

	Common Stock
For the three months ended June 30, 2022 and 2021	Shares			Par value			Additional paid-in capital			Retained earnings			Accumulated other comprehensive loss			Total shareholders’ equity			Noncontrolling interest			Total equity
Balance at March 31, 2022		167,477		$	1,675		$	13,343		$	3,965,803		$	(137,429	)	$	3,843,392		$	5,939		$	3,849,331
Shares issued under employee stock plans, net of tax withholding for net settlement		454			4			(6,173	)		—			—			(6,169	)		—			(6,169	)
Shares repurchased under provisions of stock repurchase plan		(5,000	)		(50	)		(33,401	)		(515,614	)		—			(549,065	)		—			(549,065	)
Stock compensation expense		—			—			25,518			—			—			25,518			—			25,518
Net earnings		—			—			—			377,805			—			377,805			4,421			382,226
Other comprehensive income (loss)		—			—			—			—			(56,405	)		(56,405	)		(345	)		(56,750	)
Dividends and dividend equivalents paid		—			—			850			(110,678	)		—			(109,828	)		—			(109,828	)
Balance at June 30, 2022		162,931		$	1,629		$	137		$	3,717,316		$	(193,834	)	$	3,525,248		$	10,015		$	3,535,263

Balance at March 31, 2021		168,808		$	1,688		$	101,269		$	2,887,323		$	(115,486	)	$	2,874,794		$	3,856		$	2,878,650
Shares issued under employee stock plans, net of tax withholding for net settlement		861			9			8,809			—			—			8,818			—			8,818
Shares repurchased under provisions of stock repurchase plan		(500	)		(5	)		(62,467	)		—			—			(62,472	)		—			(62,472	)
Stock compensation expense		—			—			30,909			—			—			30,909			—			30,909
Net earnings		—			—			—			316,372

Washington		91-1069248
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)

1015 Third Avenue, Seattle, Washington		98104
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		EXPD		NASDAQ Global Select Market


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐