Kuehne + Nagel International AG

Q2 recurring EBIT was CHF 381 million, up 6% year over year and 24% sequentially. Recurring group EPS improved 6% year over year, or 11% excluding currency headwinds. Sea Logistics EBIT was CHF 140 million, down 6% year over year excluding currency effects; Air Logistics EBIT was CHF 154 million, up 42% year over year excluding currency headwinds and 39% quarter over quarter; Road Logistics EBIT was CHF 36 million, up 29% organically year over year; Contract Logistics recurring EBIT was CHF 51 million, down 9% year over year excluding currency effects. Headline free cash flow in Q2 was CHF 116 million including CHF 40 million of disposal proceeds, and net working capital intensity declined to 5.5% from 6.0% at the end of Q1. Management raised full-year 2026 recurring EBIT guidance to CHF 1.35 billion-CHF 1.55 billion and said the cost reduction program remains on track for an annualized gross run rate of more than CHF 200 million by year-end 2026, with more than CHF 120 million of impact in 2026 alone.

Stefan Paul said the quarter showed continued market share expansion, with Air Logistics leading profit growth and Sea Logistics stabilizing despite some volume pressure. He emphasized that the company still expects air freight volumes to grow at 1.5x GDP and said sea volumes should improve in Q3 and Q4, with the year likely ending positive. His tone was confident but measured, repeatedly pointing to disciplined cost control, cross-selling across business units, and a stable yield trend rather than relying on a broad demand recovery.

Markus Blanka-Graff focused on the numbers behind the earnings improvement: about CHF 50 million of cost savings in the first half, working capital intensity at 5.5%, and Q2 free cash flow of CHF 116 million including CHF 40 million from asset disposals. He said the company expects a Q3 run rate similar to Q2, with acceleration into Q4, and reiterated the target of more than CHF 200 million of annualized gross savings by year-end 2026. On AI, he said the addressable white-collar workforce is just over 25,000 FTEs with a cost base of about CHF 1.7 billion, and that the expected annualized EBIT impact from AI is CHF 100 million-CHF 150 million by end-2027; he also said the company prefers a small net cash position over the long term.

Analysts pressed management on whether Contract Logistics would keep facing startup costs in Q3 and Q4; management said implementation costs should continue into Q3, with the first positive P&L impact expected in Q4. On AI, they asked whether savings would be kept as margin or passed through to customers; management said the preference is to use the benefit to grow volume with the existing workforce, though some benefit will eventually flow to customers. Questions also focused on the durability of the AI moat and rising cloud/token costs; management said its model-agnostic, in-house platform and TMS ownership should help maintain an advantage, while AI costs remain uncertain and will be revisited in the next update.