Matson (MATX) Q1 FY26 earnings call: guidance and Q&A

Will the MAX service return to full utilization during peak season (Q3) after being below 100% last year?

Management expects full or nearly full ships in Q2 and Q3, returning to a more traditional cycle, and anticipates exceeding last year's performance.

“Yes, I do, Jake. I think we said at the beginning of the year, and we continue to see it as it's unfolding in front of us, a more traditional cycle in the China trades, meaning post Lunar New Year slow build to the second and third quarter, full or nearly full ships as we have traditionally, whether we -- a week -- and we have vessels that are slightly different sizes, but we expect to be full or nearly full in the second and third quarter as we build into the traditional peak season.”

asked by Jacob Lacks · answered by Matthew Cox

Is the company seeing more shippers convert air freight to their service due to persistent high fuel prices and potential jet fuel shortages in Asia?

Management expects more air freight conversions, some temporary and some permanent, as high energy prices dislocate air freight markets. This is seen as a tailwind, though ships are already expected to be nearly full.

“I think we're entering a period where we're going to see more airfreight conversions, some of which will be temporary and some of which will continue to convert. I also think that the longer that energy prices -- I'm sorry, energy prices and availability are issues, I think the air freight markets have been significantly dislocated and especially in places where they primarily import their jet fuel.”

asked by Jacob Lacks · answered by Matthew Cox

Can management quantify the Q2 fuel lag headwind and is over-recovery possible in Q3 due to investments in scrubbers/LNG?

Management declined to quantify the Q2 fuel lag, stating it's not central to the story and they are confident in full recovery by year-end. Joel Wine clarified that fuel-related items like scrubbers are part of the overall recovery basket.

“I think the way we're thinking about it in terms of providing more visibility to our second quarter under collection, we're not exactly sure where we're going to end up. As you say, there's a significant amount of volatility. And I think it's not central to our story. As we think about it, we remain highly confident in our ability to recover fuel for the year.”

asked by Jacob Lacks · answered by Matthew Cox

Was there any change in the transshipment mix (previously around 20% of CLX/MAX) in Q1, and which regions are driving optimism for near-term growth?

Transshipment mix remains in the 20% to 25% range, expected to continue as the company grows both China and Southeast Asia origins. Southeast Asia, particularly Thailand, has exceeded expectations.

“Yes. I think we -- that 20% we previously cited, we're in the 20% to 25% range. I think we expect to continue to be in that range as we'll grow both our China origins and our Southeast Asia origins, both as we look towards filling our ships as we get into the more traditional peak season.”

asked by Joe Enderlin · answered by Matthew Cox

How would management describe overall customer hesitancy on China trade, and what is the competitive landscape like in expedited ocean?

Management believes tariff uncertainties are largely behind them, and they are optimistic about a relatively stable trade environment. The broader generic ocean market is orderly, and the secondary expedited carrier market remains similar with no dramatic changes or significant cancellations.

“But our view and is embedded in our commentary is that we think while there will be moments where tariff issues pop up, I think in our world, we think that tariff uncertainties are largely behind us.”

asked by Joe Enderlin · answered by Matthew Cox

Which services/segments are driving the expected $20 million increase in Q2 Ocean Transportation operating income, and what are the key risks?

The primary driver is continued strength in the China trade, particularly e-commerce, e-goods, and garments, returning to normal demand patterns. Key risks include geopolitical dislocations, tariffs, or other shocks to consumer demand.

“So the primary driver to that increase is really the continued strength in our China trade post lunar Near that we talked about. And so our domestic businesses, we expect to hang in there on a relatively similar basis on a year-over-year basis. So the primary uptick is really the China trade and the demand drivers in some of our core segments that Mac talked about earlier.”

asked by Tomohiko Sano · answered by Joel M. Wine

Provide more color on Hawaii and Alaska demand, economic conditions (tourism, construction, energy), and risks for 2026.

Hawaii has mixed conditions: construction is a bright spot, but tourism remains sluggish, especially international. Alaska is steady with upward trajectory due to oil and gas investment. Guam is also steady with government spending. Risks include continued sluggish tourism in Hawaii.

“So Hawaii, the bright spot is construction. There has been more construction activity. It's been fairly consistent for a year, 1.5 years, and we see that driving some demand in 2026. But it hasn't been enough to really buoy the economy in a really meaningful positive way because the other side, the tourism side has been still very sluggish.”

asked by Tomohiko Sano · answered by Joel M. Wine

What specific actions are being taken to drive recovery in the Logistics segment, and what is the outlook for the rest of the year?

The outlook is to approach last year's results. Actions include disciplined pricing and delivery for Span Alaska, and for brokerage, focusing on stickier small/medium customers, pricing discipline, good execution, and optimizing procurement of truckload capacity in a soft freight environment.

“Yes. So the outlook for the rest of the year is that we'll be approaching last year's results. And the actions we've been taking is really focusing on 2 different pieces. Our Alaska -- Span Alaska piece is about a little bit over half the logistics side. And there, we're continuing just to focus on disciplined pricing and delivery for our customers and providing the best transit times and customer service in that market.”

asked by Tomohiko Sano · answered by Jacob Lacks