Expeditors Reports Second Quarter 2016 EPS of $0.63 Per Share 1

Expeditors International of Washington, Inc. (NASDAQ:EXPD) today announced second quarter 2016 financial results including the following highlights compared to the same quarter of 2015:

• Diluted Net Earnings Attributable to Shareholders per share increased 3% to $0.63
• Net Earnings Attributable to Shareholders decreased 1% to $116 million
• Operating Income decreased 2% to $179 million
• Revenues decreased 13% to $1.5 billion
• Net Revenues2 increased slightly to $553 million while yields increased 490 basis points to 37.5%
• Airfreight tonnage volume increased 2% and ocean container volume decreased 1%

“We made significant progress in the second quarter, especially in Asia and the U.S., and continued to make the right investments with the right people to advance our strategic initiatives,” said Jeffrey S. Musser, President and Chief Executive Officer. “When faced with the same challenges that we experienced in the first quarter, our people did again what they do best, which is drive efficiency and provide highly optimized solutions for our customers. The global economic environment remains uncertain, particularly in Europe, and trade continues to slow. Despite these conditions, we continue to gain new customers and expand our market share, and we generated the best quarter of EPS in our history. We remain focused on implementing our strategic plan, with emphasis on markets to and within China and by further leveraging our strength in North America. Given our position in the global marketplace, our people and our resources, we remain optimistic about our ability to generate profitable growth.”

Bradley S. Powell, Senior Vice President and Chief Financial Officer, added, “Even though rates remained volatile again this quarter, we achieved an operating income margin as a percent of net revenues above 30%, as our people remain highly disciplined on costs and continue to take advantage of available capacity and rates in all parts of our business. We are investing in the growth of the company, but not without keeping an eye on our margins or allowing costs to impact our profitability, cash flow and returns to shareholders.”

Expeditors is a global logistics company headquartered in Seattle, Washington. The company employs trained professionals in 185 full-service offices and numerous satellite 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 distribution and customized logistics solutions.

During the three and six-month periods ended June 30, 2016 the Company repurchased 1.9 million and 3.4 million shares of common stock at an average price of $49.47 and $48.75 per share, respectively. During the three and six-month periods ended June 30, 2015, the Company repurchased 2.7 million and 4.3 million shares of common stock at an average price of $47.46 and $47.61 per share, respectively.

Disclaimer on Forward-Looking Statements:

Certain portions of this release contain forward-looking statements which are based on certain assumptions and expectations of future events that are subject to risks and uncertainties, including comments on future pricing volatility and impacts on margins; the uncertainty of the global economic environment and slowing global trade; and our ability to maintain current margin levels, advance our strategic initiatives, implement our strategic plan, continue to gain new customers, expand our market share, grow markets to and within China, leverage our position in North America, generate profitable growth and manage costs. Actual future results and trends may differ materially from historical results or those projected in any forward-looking statements depending on a variety of factors including, but not limited to, the future success of our business model, our ability to maintain consistent and stable operating results, our ability to perpetuate profits, changes in customer demand for Expeditors’ services caused by a general economic slow-down, customers’ inventory build-up, decreased consumer confidence, volatility in equity markets, energy and fuel prices, geopolitical changes, foreign exchange rates, regulatory actions or changes or the unpredictable acts of competitors and other risks, risk factors and uncertainties detailed in our Annual Report as updated by our reports on Form 10-Q, filed with the Securities and Exchange Commission.

Net Revenues (Non-GAAP measure)

We commonly refer to the term “net revenues” when commenting about our Company and the results of its operations. Net revenues are a Non-GAAP measure calculated as revenues less directly related operations expenses attributable to the Company’s principal services. We believe that net revenues are a better measure than are total revenues when analyzing and discussing our effectiveness in managing our principal services since total revenues earned as a freight consolidator must consider the carriers’ charges to us for carrying the shipment, whereas revenues earned in other capacities include primarily the commissions and fees earned by us. Net revenue is one of our primary operational and financial measures and demonstrates our ability to concentrate and leverage purchasing power through effective consolidation of shipments from customers utilizing a variety of transportation carriers and optimal routings. Using net revenues also provides a commonality for comparison among various services. The following table presents the calculation of net revenues.

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