A month has gone by since the last earnings report for Kirby (KEX). Shares have added about 8.4% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Kirby due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Earnings Beat at Kirby in Q3
Kirby reported third-quarter 2025 earnings of $1.65 per share, which surpassed the Zacks Consensus Estimate of $1.60 and improved 6.5% year over year. Total revenues of $871.2 million missed the Zacks Consensus Estimate of $888.3 million but improved 4.8% year over year.
Q3 Segmental Performance of KEX
The company operates via two segments, namely, marine transportation and distribution and services.
Marine transportation revenues for the third quarter of 2025 were $484.9 million, down 0.2% year over year. Operating income for the third quarter came in at $88.6 million compared with $99.5 million in the year-ago quarter. Segment operating margin for the third quarter fell to 18.3% from 20.5% in the year-ago quarter.
In the inland market, third quarter average barge utilization was in the mid-80% range. Average spot market rates were down in the low-to-mid single digits sequentially and year over year. Term contracts which got renewed in the third quarter were flat on average from the year-ago quarter. The inland market accounted for 80% of segment revenues in the third quarter of 2025. Inland’s operating margin was in the high teens range for the quarter.
In coastal market, market conditions were solid during the reported quarter, with Kirby’s barge utilization in the mid to high-90% range. Term contracts which got renewed in the third quarter increased in the mid-teens range on average on a year-over-year basis. Coastal revenues grew 13% year-over-year owing to increased pricing. Coastal revenues accounted for 20% of marine transportation segment revenues and had an operating margin around 20%.
Distribution and services revenues for the third quarter of 2025 were $386.2 million, up 11.9% year over year. Operating income for the third quarter was $42.7 million compared with $30.4 million in the year-ago quarter. Operating margin rose to 11% from 8.8% in the year-ago quarter.
In the power generation market, revenues grew 56% and operating income grew 96% year over year, respectively, owing to solid execution on backlog. Overall, power generation revenues accounted for almost 45% of segment revenues. Power generation operating margins were in the low double digits.
In the commercial and industrial market, revenues grew 4% and operating income grew 12%, year over year, respectively, on the back of steady marine repair work and gradual gains in on-highway repair services. Commercial and industrial revenues accounted for 44% of segment revenues. Commercial and industrial operating margins were in the high single digits.
In the oil and gas market, revenues declined 38% year over year owing to lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts partially offset by deliveries of e-frac equipment. Operating income increased 5% year over year. Oil and gas revenues accounted for 11% of segment revenues. Oil and gas operating margins were in the low double digits.
Balance Sheet Highlights & Cash Flow
As of Sep 30, 2025, Kirby had cash and cash equivalents of $47.02 million compared with $68.38 million at the end of the prior quarter.
During the reported quarter, KEX generated $227.5 million of net cash from operating activities, and capital expenditures were $67.2 million.
Kirby repurchased 1,314,009 shares for $120.0 million in the third quarter and an additional 428,955 shares for $36 million so far (till Oct 29, 2025) in the fourth quarter of 2025.
KEX’s 2025 Outlook
For inland marine, market conditions are anticipated to remain stable, with some early signs of improvement evident. While term contract rates are anticipated to continue improving over the long term, driven by the slow pace of newbuild activity and tight vessel availability, spot market pricing could continue to face modest pressure in the near term if demand softness re-emerges. Overall, inland revenues and margins are expected to improve modestly from the third quarter levels, assuming tighter barge availability holds in the fourth quarter.
In coastal marine, market fundamentals remain very favorable, with steady customer demand and barge utilization anticipated to hold in the mid to high-90% range. Kirby anticipates to conclude the year with coastal revenues and operating margins comparable to the third quarter of 2025.
In distribution and services, the outlook reflects strength in growing markets with continued discipline in challenged areas. Power generation continues to be a strong contributor, with sustained demand from data centers and industrial customers driving order growth. In commercial and industrial, marine repair activity is solid, and the on-highway market continues to improve. Oil and gas growth remains limited by current market dynamics and customer capital discipline. For the segment, KEX anticipates full-year revenues to be up in the mid-single digits, with operating margins in the high-single digits.
Net cash flow provided by operating activities is anticipated in the $620-$720 million band. Capital expenditures are now expected to be between $260 million and $290 million.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates revision.
VGM Scores
At this time, Kirby has a average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock has a score of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Kirby has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Kirby Corporation (KEX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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