Expeditors International of Washington, Inc. (NASDAQ:EXPD) today announced third quarter 2022 financial results including the following highlights compared to the same quarter of 2021:

Diluted Net Earnings Attributable to Shareholders per share (EPS¹) increased 22% to $2.54
Net Earnings Attributable to Shareholders increased 15% to $414 million
Operating Income increased 8% to $527 million
Revenues increased 1% to $4.4 billion
Airfreight tonnage volume and ocean container volume decreased 13% and 10%, respectively

"We continued to perform at a very high level, generating another strong quarter of financial performance and cash flow," said Jeffrey S. Musser, President and Chief Executive Officer. "We accomplished this despite uncertain economic conditions that resulted in declines in tonnage and volumes, reductions in both buy and sell rates, and an overall rebalancing of capacity in the logistics freight markets. These conditions have continued in recent weeks and we believe that inflation, high energy costs, and government fiscal and monetary measures will continue to exert pressure on global supply chains. Additionally, many shippers are now looking to shrink retail inventories that were overstocked earlier in the year in reaction to COVID-related supply chain disruptions.

"All of our people and products performed well during the quarter, as buy and sell rates remained volatile while declining from their pandemic peaks. Once again, we were able to adjust quickly to rapidly evolving operating conditions in which pandemic-induced demand and supply chain constraints gave way to falling demand, and while not completely eliminated, an easing of many of the labor and equipment shortages and the bottlenecks that had so severely constrained capacity and impeded throughput at the ports over the past two years. We are also seeing air capacity return to higher levels, with Hong Kong and other origins in Asia reopening. In addition, the largely land- and port-based constraints that had so severely impacted the ocean market have significantly improved to where carriers are once again starting to manage capacity in certain trade lanes in an effort to address declining demand while sustaining falling rates.

"Based on what we currently see, these changing conditions that involve decelerating demand and an overall decline in rates are likely to continue for the remainder of 2022 and into 2023. Just as we quickly adapted to unprecedented operating conditions spurred by the pandemic, we are adjusting for this new operating environment and continue to make focused efforts to control costs. Most critically, we remain fully engaged with our customers to accommodate their needs for capacity and services, while looking forward to when the economy eventually reverses course and demand starts to increase again."

Bradley S. Powell, Senior Vice President and Chief Financial Officer, added, "As we have commented previously, we did not expect the unprecedented COVID-related operating conditions to persist long-term. We believe we are now seeing a changing environment. While many concurrent disruptions continue to plague our industry, including the quarantines in China, the conflict in Ukraine, and the shortage of labor and certain equipment, conditions are starting to ease. We now believe we are seeing a shift towards slowing volumes and falling rates. We have been here before and know which levers to pull to enhance our efficiencies and control costs. We are ready to further align ourselves with a post-COVID environment of higher inflation and tapered demand. We do not know how long these new conditions will last. We will continue to invest appropriately for the long-term in our people, processes, and technology, and we believe we will be fully capable of meeting the eventual upturn in demand." Mr. Powell noted that the Company benefitted from a favorable tax rate during the quarter and returned over $1 billion to shareholders via repurchased stock so far this year.

Expeditors is a global logistics company headquartered in Seattle, Washington. The Company employs trained professionals in 176 district offices and numerous branch locations located on six continents linked into a seamless worldwide network through an integrated information management system. Services include the consolidation or forwarding of air and ocean freight, customs brokerage, vendor consolidation, cargo insurance, time-definite transportation, order management, warehousing and distribution and customized logistics solutions.

_______________________

¹Diluted earnings attributable to shareholders per share.

NOTE: See Disclaimer on Forward-Looking Statements in this release.

Disclaimer on Forward-Looking Statements:

Certain statements contained in this news release are "forward-looking statements," based on management's views with respect to future events and underlying assumptions that involve risks and uncertainties. These forward-looking statements include statements regarding the future stabilization of supply/demand imbalance and rate volatility; the continued unsettled operating environment due to uncertain air and ocean capacity; volatile air and ocean pricing and uneven demand for such services; port congestion; equipment imbalances; labor shortages; uncertain availability of warehouse and pier space; trade disruptions; rising fuels costs; the conflict in Ukraine; inflation, high energy costs, government fiscal and monetary measures, and signs of a slowing economy and drop in demand; and the uneven lifting of the COVID-19 pandemic restrictions around the world. Future financial performance could differ materially because of factors such as: our ability to leverage the strength of our carrier relationships to secure space; the strength of our non-asset-based operating model; our expectation that the supply/demand imbalance, rate volatility, and various on-shore bottlenecks may continue; our ability to control costs and continue to enhance our productivity; our ability to invest in our strategic efforts to explore new areas for profitable growth; and our ability to remain a strong, healthy, unified and resilient organization. The ongoing impact of the COVID-19 pandemic could have the effect of heightening many of the other risks described in Item 1A of our Annual Report on Form 10-K, including, without limitation, those related to the success of our strategy and desire to maintain historical unitary profitability, our ability to attract and retain customers, our ability to manage costs, interruptions to our information technology systems, the ability of third-party providers to perform and potential litigation as updated by our reports on Form 10-Q, filed with the Securities and Exchange Commission. These and other factors are discussed in the Company's regulatory filings with the Securities and Exchange Commission, including those in "Item 1A. Risk Factors" of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and the Company's most recent Form 10-Q. The forward-looking statements contained in this news release speak only as of this date and the Company does not assume any obligation to update them except as required by law.

Expeditors International of Washington, Inc. Third Quarter 2022 Earnings Release, November 8, 2022 Financial Highlights for the three and nine months ended September 30, 2022 and 2021 (Unaudited) (in 000's of US dollars except per share data)

	Three months ended September 30,					Nine months ended September 30,
	2022		2021		% Change	2022		2021		% Change
Revenues	$	4,362,146	$	4,319,261	1%	$	13,629,756	$	11,127,174	22%
Directly related cost of transportation and other expenses¹	$	3,194,273	$	3,185,490	-	$	10,151,332	$	8,031,407	26%
Salaries and other operating expenses²	$	640,950	$	644,134	-	$	1,983,759	$	1,809,970	10%
Operating income	$	526,923	$	489,637	8%	$	1,494,665	$	1,285,797	16%
Net earnings attributable to shareholders	$	414,209	$	359,068	15%	$	1,138,123	$	962,660	18%
Diluted earnings attributable to shareholders per share	$	2.54	$	2.09	22%	$	6.84	$	5.61	22%
Basic earnings attributable to shareholders per share	$	2.56	$	2.12	21%	$	6.90	$	5.68	21%
Diluted weighted average shares outstanding		163,250		171,565	(5)%		166,398		171,549	(3)%
Basic weighted average shares outstanding		162,029		169,633	(4)%		164,944		169,398	(3)%

_______________________
¹		Directly related cost of transportation and other expenses totals Operating Expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.
²		Salaries and other operating expenses totals Salaries and related, Rent and occupancy, Depreciation and amortization, Selling and promotion and Other as shown in the Condensed Consolidated Statements of Earnings.

	Employee Full-time Equivalents as of September 30,
	2022		2021
North America		7,799		7,315
Europe		4,194		3,860
North Asia		2,488		2,440
South Asia		1,845		1,740
Middle East, Africa and India		1,549		1,507
Latin America		851		801
Information Systems		1,144		976
Corporate		399		395
Total		20,269		19,034

	Third quarter year-over-year percentage decrease in:
2022	Airfreight kilos	Ocean freight FEU
July	(11)%	(9)%
August	(14)%	(11)%
September	(15)%	(10)%
Quarter	(13)%	(10)%

During the three and nine months ended September 30, 2022, we repurchased 4.5 million and 9.5 million shares of common stock at $103.56 and $106.84 per share, respectively. During the three and nine months ended September 30, 2021, we repurchased 0.6 million and 2.0 million shares of common stock at an average price of $124.95 and $110.45 per share, respectively.

Investors may submit written questions via e-mail to: investor@expeditors.com. Questions received by the end of business on November 11, 2022 will be considered in management's 8-K "Responses to Selected Questions."

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (In thousands, except per share data) (Unaudited)

	September 30, 2022			December 31, 2021
Assets:
Current Assets:
Cash and cash equivalents	$	2,154,534		$	1,728,692
Accounts receivable, less allowance for credit loss of $9,760 at September 30, 2022 and $6,686 at December 31, 2021		2,748,322			3,810,286
Deferred contract costs		499,935			987,266
Other		184,765			108,801
Total current assets		5,587,556			6,635,045
Property and equipment, less accumulated depreciation and amortization of $548,585 at September 30, 2022 and $541,677 at December 31, 2021		480,941			487,870
Operating lease right-of-use assets		486,980			459,158
Goodwill		7,927			7,927
Deferred federal and state income taxes, net		27,295			729
Other assets, net		16,827			19,200
Total assets	$	6,607,526		$	7,609,929
Liabilities:
Current Liabilities:
Accounts payable		1,544,757			2,012,461
Accrued liabilities, primarily salaries and related costs		404,207			403,625
Contract liabilities		594,244			1,142,026
Current portion of operating lease liabilities		88,535			82,019
Federal, state and foreign income taxes		74,507			86,166
Total current liabilities		2,706,250			3,726,297
Noncurrent portion of operating lease liabilities		409,883			385,641
Commitments and contingencies
Shareholders' Equity:
Preferred stock, none issued		—			—
Common stock, par value $0.01 per share. Issued and outstanding: 159,128 shares at September 30, 2022 and 167,210 shares at December 31, 2021		1,591			1,672
Additional paid-in capital		118			3,160
Retained earnings		3,738,600			3,620,008
Accumulated other comprehensive loss		(258,129	)		(130,414	)
Total shareholders' equity		3,482,180			3,494,426
Noncontrolling interest		9,213			3,565
Total equity		3,491,393			3,497,991
Total liabilities and equity	$	6,607,526		$	7,609,929

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Earnings (In thousands, except per share data) (Unaudited)

	Three months ended September 30,					Nine months ended September 30,
	2022			2021		2022		2021
Revenues:
Airfreight services	$	1,480,955		$	1,628,115	$	4,682,076	$	4,477,599
Ocean freight and ocean services		1,684,579			1,598,597		5,420,471		3,651,059
Customs brokerage and other services		1,196,612			1,092,549		3,527,209		2,998,516
Total revenues		4,362,146			4,319,261		13,629,756		11,127,174
Operating Expenses:
Airfreight services		1,104,812			1,244,381		3,459,861		3,335,253
Ocean freight and ocean services		1,343,355			1,254,334		4,345,963		2,859,020
Customs brokerage and other services		746,106			686,775		2,345,508		1,837,134
Salaries and related		499,341			519,611		1,546,503		1,452,902
Rent and occupancy		52,715			46,730		155,241		137,376
Depreciation and amortization		15,187			12,753		42,416		38,415
Selling and promotion		6,239			4,237		16,174		10,479
Other		67,468			60,803		223,425		170,798
Total operating expenses		3,835,223			3,829,624		12,135,091		9,841,377
Operating income		526,923			489,637		1,494,665		1,285,797
Other Income (Expense):
Interest income		7,835			2,462		12,447		6,596
Other, net		98			733		7,731		6,382
Other income, net		7,933			3,195		20,178		12,978
Earnings before income taxes		534,856			492,832		1,514,843		1,298,775
Income tax expense		120,694			132,922		368,975		333,941
Net earnings		414,162			359,910		1,145,868		964,834
Less net (losses) earnings attributable to the noncontrolling interest		(47	)		842		7,745		2,174
Net earnings attributable to shareholders	$	414,209		$	359,068	$	1,138,123	$	962,660
Diluted earnings attributable to shareholders per share	$	2.54		$	2.09	$	6.84	$	5.61
Basic earnings attributable to shareholders per share	$	2.56		$	2.12	$	6.90	$	5.68
Weighted average diluted shares outstanding		163,250			171,565		166,398		171,549
Weighted average basic shares outstanding		162,029			169,633		164,944		169,398

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited)

	Three months ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Operating Activities:
Net earnings	$	414,162		$	359,910		$	1,145,868		$	964,834
Adjustments to reconcile net earnings to net cash from operating activities:
Provisions for losses on accounts receivable		5,570			3,739			9,917			6,028
Deferred income tax (benefit) expense		(3,070	)		(7,658	)		(14,928	)		2,343
Stock compensation expense		14,175			15,204			51,296			57,298
Depreciation and amortization		15,187			12,753			42,416			38,415
Other, net		1,435			626			144			1,523
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable		634,421			(714,300	)		880,364			(1,377,997	)
(Decrease) increase in accounts payable and accrued expenses		(350,922	)		436,343			(343,902	)		769,525
Decrease (increase) in deferred contract costs		226,087			(328,932	)		437,155			(550,572	)
(Decrease) increase in contract liabilities		(249,895	)		381,192			(488,826	)		635,286
(Decrease) increase in income taxes payable, net		(31,397	)		33,378			(78,568	)		32,022
(Increase) decrease in other, net		(5,369	)		(14,884	)		2,040			(15,208	)
Net cash from operating activities		670,384			177,371			1,642,976			563,497
Investing Activities:
Purchase of property and equipment		(15,928	)		(9,870	)		(68,498	)		(24,800	)
Other, net		(590	)		(157	)		(645	)		(53	)
Net cash from investing activities		(16,518	)		(10,027	)		(69,143	)		(24,853	)
Financing Activities:
Payments from borrowing on lines of credit		(21,117	)		(1,045	)		(29,601	)		(2,570	)
Proceeds from borrowing on lines of credit		—			8,524			56,545			10,138
Proceeds from issuance of common stock		61,885			56,965			73,318			99,433
Repurchases of common stock		(469,041	)		(76,595	)		(1,018,106	)		(225,064	)
Dividends paid		—			—			(109,828	)		(98,387	)
Payments for taxes related to net share settlement of equity awards		—			(4	)		(19,333	)		(15,172	)
Distribution to noncontrolling interest		(543	)		(1,631	)		(543	)		(1,631	)
Net cash from financing activities		(428,816	)		(13,786	)		(1,047,548	)		(233,253	)
Effect of exchange rate changes on cash and cash equivalents		(47,487	)		(7,573	)		(100,443	)		(13,076	)
Change in cash and cash equivalents		177,563			145,985			425,842			292,315
Cash and cash equivalents at beginning of period		1,976,971			1,674,121			1,728,692			1,527,791
Cash and cash equivalents at end of period	$	2,154,534		$	1,820,106		$	2,154,534		$	1,820,106
Taxes Paid:
Income taxes	$	150,960		$	104,617		$	465,711		$	295,153

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. AND SUBSIDIARIES Business Segment Information (In thousands) (Unaudited)

	UNITED STATES		OTHER NORTH AMERICA		LATIN AMERICA		NORTH ASIA		SOUTH ASIA		EUROPE		MIDDLE EAST, AFRICA AND INDIA		ELIMI- NATIONS			CONSOLI- DATED
For the three months ended September 30, 2022:
Revenues	$	1,244,515		140,622		68,057		1,489,331		518,780		637,411		264,518		(1,088	)		4,362,146
Directly related cost of transportation and other expenses¹	$	742,826		80,116		41,638		1,250,872		416,817		453,248		209,248		(492	)		3,194,273
Salaries and other operating expenses²	$	314,442		30,151		15,057		98,758		37,577		109,308		36,181		(524	)		640,950
Operating income	$	187,247		30,355		11,362		139,701		64,386		74,855		19,089		(72	)		526,923
Identifiable assets at period end	$	3,553,279		272,527		137,472		915,895		421,148		1,020,756		322,160		(35,711	)		6,607,526
Capital expenditures	$	9,278		556		419		581		426		3,619		1,049		—			15,928
Equity	$	2,430,632		129,346		59,494		304,496		180,855		289,595		140,147		(43,172	)		3,491,393
For the three months ended September 30, 2021:
Revenues	$	1,134,096		116,404		54,303		1,690,381		538,780		564,810		221,777		(1,290	)		4,319,261
Directly related cost of transportation and other expenses¹	$	661,515		63,031		34,216		1,417,283		445,970		389,208		174,733		(466	)		3,185,490
Salaries and other operating expenses²	$	238,943		33,077		14,759		141,109		54,003		126,475		36,598		(830	)		644,134
Operating income	$	233,638		20,296		5,328		131,989		38,807		49,127		10,446		6			489,637
Identifiable assets at period end	$	3,417,496		256,638		110,406		1,558,109		457,615		990,123		328,671		(42,675	)		7,076,383
Capital expenditures	$	6,001		248		175		435		351		2,254		406		—			9,870
Equity	$	2,451,584		93,084		37,087		368,535		129,941		258,805		123,304		(41,748	)		3,420,592



	UNITED STATES		OTHER NORTH AMERICA		LATIN AMERICA		NORTH ASIA		SOUTH ASIA		EUROPE		MIDDLE EAST, AFRICA AND INDIA		ELIMI- NATIONS			CONSOLI- DATED
For the nine months ended September 30, 2022:
Revenues	$	3,751,102		390,220		191,900		4,840,822		1,776,355		1,871,509		811,147		(3,299	)		13,629,756
Directly related cost of transportation and other expenses¹	$	2,303,428		230,154		118,793		4,054,319		1,463,173		1,335,267		647,510		(1,312	)		10,151,332
Salaries and other operating expenses²	$	962,817		86,328		42,654		326,767		121,634		333,971		111,481		(1,893	)		1,983,759
Operating income	$	484,857		73,738		30,453		459,736		191,548		202,271		52,156		(94	)		1,494,665
Identifiable assets at period end	$	3,553,279		272,527		137,472		915,895		421,148		1,020,756		322,160		(35,711	)		6,607,526
Capital expenditures	$	45,149		2,672		705		1,878		1,152		13,343		3,599		—			68,498
Equity	$	2,430,632		129,346		59,494		304,496		180,855		289,595		140,147		(43,172	)		3,491,393
For the nine months ended September 30, 2021:
Revenues	$	3,007,053		311,986		146,148		4,208,811		1,306,264		1,576,092		574,469		(3,649	)		11,127,174
Directly related cost of transportation and other expenses¹	$	1,731,032		175,392		86,868		3,471,453		1,051,133		1,072,973		444,132		(1,576	)		8,031,407
Salaries and other operating expenses²	$	718,762		90,114		41,871		354,841		146,214		359,338		100,899		(2,069	)		1,809,970
Operating income	$	557,259		46,480		17,409		382,517		108,917		143,781		29,438		(4	)		1,285,797
Identifiable assets at period end	$	3,417,496		256,638		110,406		1,558,109		457,615		990,123		328,671		(42,675	)		7,076,383
Capital expenditures	$	11,931		434		300		1,192		1,462		7,908		1,573		—			24,800
Equity	$	2,451,584		93,084		37,087		368,535		129,941		258,805		123,304		(41,748	)		3,420,592

¹Directly related cost of transportation and other expenses totals operating expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.

²Salaries and other operating expenses totals salaries and related, rent and occupancy, depreciation and amortization, selling and promotion and other as shown in the Condensed Consolidated Statements of Earnings.

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