Shipping Profits Sink as Overcapacity, Weak Demand Drag Down Rates

Profit margins of ocean carriers are projected to drop by more than half in 2025 compared to
2023 levels, as vessel capacity continues to outpace demand.

Capital IQ Estimates, the sister company of the Journal of Commerce under S&P Global,
reported on 3 September that earnings of eight publicly traded ocean carriers are expected to
fall by an average of 61 percent from last year, raising the risk of losses for liner operators next
year.

The same data had initially pointed to a 53 percent earnings decline as of 31 March, but the
outlook worsened after carriers posted weak second-quarter results and issued grim forecasts
for the rest of 2025.

Maersk was the only exception, with its earnings estimate revised upward after Chief Executive
Vincent Clerc said the company’s non-ocean logistics business was on track to hit its 2025 profit
margin targets.

Meanwhile, HSBC warned that higher prices driven by tariffs could weigh on consumer demand,
while frontloading of imports from the second to early third quarter may disrupt retailer
restocking cycles for the remainder of 2025.

“In this context, we argue that carriers will face margin compression as they balance capacity
cuts against softening demand in the rest of the year,” HSBC said.

For 2026, the outlook remains weak. J.P. Morgan reported last week that global shipping rates
could drop below $1,000 per TEU amid sluggish demand and vessel oversupply. With operating
costs rising and the possible resumption of Suez Canal transits adding to capacity pressures,
the bank said it expects “material EBIT losses” for liner operators under its coverage.