The US freight recession is showing no signs of relenting

• Shares of J.B. Hunt slid as much as 9% on Wednesday after mixed earnings.
• First-quarter results suggested that trucking demand remains weak.
• Tariffs are expected to add to the industry downturn.

Shares of a leading trucking firm are tanking after its first-quarter earnings signaled no end to the ongoing freight recession.

The JB Hunt stock dropped as much as 9% on Wednesday after the firm reported an 8% decrease in operating income from the year prior. Though the company modestly beat earnings and revenue estimates, earnings-per-share were down 4%.

That's likely a painful sight for a freight market hoping for a trucking revival. Executives at the bellwether firm signaled continued dismay over the freight recession, where weak demand and too many trucks have been an ongoing problem since the pandemic.

"I've never seen a recession last three years. I think everyone's holding on," CEO Shelly Simpson said in the earnings call. "It is a very difficult environment that we're operating in and I think everyone's trying to adapt to it."

Even though falling costs have been a silver lining in previous industry recessions, inflation is adding to the problem, she noted.

Meanwhile, the Trump administration's tough tariffs are expected to add to the multi-year downturn. Tariffs have become a major talking point across the industry, and the truckmaking firm Traton has warned global trade uncertainty is pushing US truckers to defer orders.

JB Hunt is also watching for tariff reactions.

"Our customers continue to plan for multiple what if scenarios, but most of them are waiting for the dust to settle to determine how tariffs might influence and change their short and long term business strategies," said Spencer Fraser, executive vice president of sales and marketing.

"As part of this scenario planning process, some customers are considering ways to alter supply chain freight flows and or their country of origin sourcing, but these changes will be part of a much longer decision process."

In an April note, JPMorgan analysts took a cautious view on the transports sector amid the mounting trade war and rising recession risks. It noted that trucking overcapacity remains a big headwind:

"Net new additions since 2020 created ~18% capacity that will take 15 years to normalize at current 2025 YTD exit rates," the note said.