Matson (NYSE:MATX) said it ended 2025 with fourth-quarter consolidated results that exceeded management’s expectations, supported by stronger-than-anticipated performance in its China service and steadier conditions in the Transpacific trade lane following a U.S.-China trade and economic deal announced October 30.
Fourth-quarter results: China strength helped offset mixed trends elsewhere
Chairman and CEO Matt Cox said ocean transportation operating income in the fourth quarter “approached” the prior-year level, primarily due to higher-than-expected freight rates and volumes in the company’s China service, which he attributed to strong e-commerce and electronic goods demand. Cox also cited a “more stable trading environment” after the October 30 agreement, which he said reduced uncertainty tied to tariffs, port entry fees, global trade, and geopolitical factors.
Executive Vice President and CFO Joel Wine reported consolidated operating income of $143.7 million for the fourth quarter, down $3.8 million year-over-year. He said the decline reflected lower contributions from ocean transportation ($1.4 million) and logistics ($2.4 million).
Wine also highlighted several below-the-line items in the quarter:
- Interest income of $6.7 million, down $3.6 million year-over-year due to a lower cash balance and lower deposits in the Capital Construction Fund (CCF).
- Effective tax rate of 5.2%, compared with 19.1% a year earlier, reflecting a one-time tax adjustment of $18.5 million related to deferred tax assets and liabilities. Wine said the adjustment increased diluted EPS by $0.59.
- Net income of $143.1 million and diluted EPS of $4.60.
Full-year 2025: Operating income fell as Transpacific conditions weighed on China service
For the full year, Cox said consolidated operating income declined year-over-year, primarily due to lower volume and freight rates in Matson’s China service over the last three quarters of 2025, as customers managed freight amid tariff-related uncertainty and volatility.
Wine said full-year consolidated operating income was $499.8 million, down $51.5 million year-over-year, with lower contributions from ocean transportation ($45.3 million) and logistics ($6.2 million). He said the ocean transportation decline was largely driven by China, partially offset by a higher contribution from SSA Terminals.
Trade lane and segment details: Hawaii, China, Guam, Alaska, SSA Terminals, and Logistics
Hawaii: Matson said Hawaii container volume rose 0.6% year-over-year in the fourth quarter and increased 1.6% for full-year 2025. Cox attributed the annual increase to higher general demand and a competitor vessel dry-docking in the first half of 2025. Citing UHERO’s December report, management described Hawaii’s economy as “sluggish,” with softer tourism and inflationary pressure offsetting construction strength, and noted expectations for international visitor arrivals to decline in 2026 before recovering in 2027. Matson expects 2026 Hawaii volume to be comparable to 2025.
China service: Fourth-quarter 2025 container volume was down 7.2% year-over-year, and full-year volume decreased 9.5%. Cox said the fourth quarter saw better-than-expected rates and volume due to strong e-commerce and e-goods demand, and noted demand remained stable up to the Lunar New Year holiday in mid-February 2026. He said the company did not see the typical pre-holiday demand “bump” and expects first-quarter 2026 China volume to be lower than the prior-year period as shipping patterns return to a more traditional Lunar New Year environment.
For full-year 2026, Matson expects China service volume to be “modestly higher” than 2025. Cox emphasized that the company is not focused on filling ships, but on “maximiz[ing] the yield in every sailing out of Shanghai and maintain[ing] price.” He said premium rates reflect Matson’s value proposition versus air freight and the speed and reliability of its CLX and MAX services, which he described as the fastest and second-fastest ocean services from Shanghai to Long Beach.
Southeast Asia expansion: Cox said Matson added a second weekly feeder service from Vietnam and began a weekly feeder service from Thailand in December. In Q&A, he said Thailand volumes are “slow and steady,” beginning at about 50 loads per sailing, with growth expected over time. He also described a mix of cross-border trucking and an all-water feeder option from Thailand connecting into Shanghai.
Guam: Fourth-quarter container volume increased 4.4% year-over-year, while full-year volume fell 4.3%. Matson expects 2026 volume to be comparable to 2025, citing expectations for the local economy to moderate amid a challenging tourism environment.
Alaska: Fourth-quarter volume decreased 3.3% year-over-year due to one fewer northbound sailing, partially offset by higher seafood export volume on the AAX service. Full-year 2025 Alaska volume increased 1.7% on higher export seafood volume, again partially offset by one fewer northbound sailing. Management expects 2026 volume to be comparable to 2025 and described Alaska’s economy as showing “good economic growth,” supported by job growth and oil and gas activity.
SSA Terminals (SSAT) joint venture: Matson said the SSAT terminal joint venture contributed $9.3 million in the fourth quarter, a year-over-year increase of $18.8 million. Management attributed the year-over-year change largely to an $18.4 million impairment charge tied to a write-down of a terminal operating lease asset that had negatively impacted fourth-quarter 2024 results. For full-year 2025, SSAT contributed $32.5 million, compared with a $1.0 million loss in the prior year, reflecting the impairment comparison and higher lift volume. Matson expects SSAT’s 2026 contribution to be comparable to 2025.
Logistics: Fourth-quarter logistics operating income was $7.7 million, down $2.4 million year-over-year due mainly to supply chain management. Full-year logistics operating income was $44.2 million, down $6.2 million, primarily due to lower contributions from freight forwarding and transportation brokerage.
Capital allocation, cash flow, and capital spending
Wine said Matson generated trailing 12-month cash flow from operations of $547.1 million and returned $348.2 million to shareholders through dividends and repurchases, while spending $149.1 million on maintenance capital expenditures. He said operating cash flow exceeded the combined total of maintenance CapEx, dividends, and repurchases by $49.8 million.
During the fourth quarter, Matson repurchased about 0.7 million shares for $78.1 million. For full-year 2025, the company repurchased about 2.7 million shares for $307.4 million. Since initiating the program in August 2021 through year-end 2025, Matson repurchased 13.9 million shares (about 31.9% of then-outstanding shares) for approximately $1.3 billion. Cox said the company plans to continue returning excess capital absent large organic or inorganic growth opportunities and expects to remain “steady buyers” of shares.
Total debt at the end of the fourth quarter was $361.2 million, down $9.7 million sequentially and down $39.7 million for the year.
Wine said 2025 capital expenditures totaled $393.4 million, including $244.3 million of capitalized vessel construction spending for new Aloha Class vessels and $149.1 million of maintenance and other CapEx. He noted maintenance and other CapEx was about $20 million higher than previously communicated due to “financially attractive early lease buyouts” for equipment already in the fleet.
Looking ahead, Matson expects in 2026:
- $425 million of new vessel construction expenditures (including capitalized interest and owner’s items)
- $150 million to $170 million of maintenance and other CapEx, including about $20 million of equipment lease buyouts and roughly $30 million more than normal for containers and chassis
Wine said equipment spending is being pulled forward in part due to favorable pricing, noting new dry container pricing is at an “eight-year low.” As of December 31, Matson had about $142 million in cash and cash equivalents and about $533 million in its CCF. He said the CCF covers about 92% of remaining milestone payment obligations and that the company is in a “great funding position” for its newbuild program.
2026 outlook and key Q&A themes
For the first quarter of 2026, Matson expects ocean transportation operating income of approximately $50 million, lower than the prior year due to lower China volume. Logistics operating income is expected to be modestly below the $8.5 million achieved in the first quarter of 2025, and consolidated operating income is expected to be lower year-over-year.
For full-year 2026, management expects operating income to “approach” 2025 levels, including ocean transportation operating income approaching $455.6 million and logistics operating income approaching $44.2 million, with consolidated operating income approaching $499.8 million. Additional full-year 2026 expectations included:
- Depreciation and amortization of about $210 million (including about $35 million of dry dock amortization)
- Interest income of about $15 million and interest expense of about $6 million
- Other income of about $7 million
- Effective tax rate of about 21%
- Dry docking payments of about $45 million
During Q&A, Cox said Matson’s guidance is “independent” of whether Red Sea sailings broadly resume, adding that while a reopening could add an estimated 7% to 9% of capacity to the broader market, Matson’s service offering has “increasingly distanced itself” from generic ocean services. He also said the company is seeing some data center-related demand within its e-goods segment, including “racking and servers” shifting from air freight into Matson’s expedited service.
On port fees, Wine said Matson paid $6.4 million in the fourth quarter, which he noted had been previously disclosed.
About Matson (NYSE:MATX)
Matson, Inc (NYSE: MATX) is a U.S.-based provider of ocean transportation and supply chain logistics services with a focus on Pacific trade lanes. The company operates a fleet of container ships that regularly service Hawaii, Alaska, Guam, Micronesia and other Pacific islands, as well as mainland U.S. ports. Matson’s ocean transportation segment offers scheduled liner services, expedited shipping options and specialized project cargo handling for industries ranging from retail to heavy machinery.
In addition to its core liner operations, Matson offers ocean transportation services between Asia and the U.S.
