DHL Group has reported its fourth consecutive quarter of profit growth despite falling revenues across most of its divisions, underscoring a shift from expansion to efficiency in the world’s largest logistics group.
Operating profit (EBIT) rose by 7.6% to €1.48 billion in the third quarter of 2025, while group revenue slipped 2.3% to €20.1 billion, reflecting weaker global freight demand and negative currency effects. Free cash flow (excluding M&A) nearly doubled to €1.2 billion, helped by tight cost control and lower investment spending.
Chief executive Tobias Meyer said the results demonstrated “resilience” in a volatile trading environment.
“Through active capacity management and structural cost improvements we have improved our result for four consecutive quarters,” he said.
CFO Melanie Kreis added that the company’s actions “underscore the effectiveness of measures to enhance profitability and capital efficiency in a challenging environment.”
Efficiency replaces expansion
Behind the reassuring headline figures lies a story of a company leaning on productivity rather than growth. Revenues fell in four of DHL’s five divisions, but profits rose thanks to price adjustments, automation, and reduced aviation and labour costs under its ongoing Fit for Growth programme.
Artificial intelligence and robotics are being introduced across operations, from customs clearance to delivery scheduling, to improve productivity and offset wage inflation.
The company’s Express unit, historically its most profitable segment, managed to lift operating earnings by 0.8% to €692 million even as international shipment volumes fell 10.6%, particularly on U.S. routes affected by new tariffs and the end of the de minimis exemption. Lower fuel and hub costs, coupled with higher yields per kilogram, kept margins stable at 11.8%.
In contrast, the Global Forwarding and Freight arm continued to suffer from falling freight rates and subdued European demand. Revenue dropped 9.2%, and profit slumped almost 30% to €195 million. The company cited “low volume dynamics in air freight and a lack of seasonal upturn in sea freight” as signs of a sluggish market. Forwarding’s decline highlights the broader weakness in industrial trade flows that also affects European hauliers.
Structural pillars in logistics and e-commerce
While traditional transport activities stalled, DHL’s Supply Chain and eCommerce divisions provided stability. Contract logistics, driven by automation and new business in the life sciences and healthcare sector, maintained high profitability with a 6.3% EBIT margin. DHL signed €1.4 billion in new contracts in the quarter, including e-fulfilment and consumer goods projects.
The eCommerce division reported an apparent surge in profit to €176 million, though most of it stemmed from a one-off gain linked to the Evri merger in the UK, completed in September.
Excluding that effect, the underlying margin remained modest.
Nevertheless, parcel volumes grew strongly in Europe, confirming the resilience of business-to-consumer deliveries.
Cash generation masks rising leverage
DHL’s strong cash performance was driven less by buoyant trading than by working-capital optimisation and restrained capital expenditure, which fell to €632 million. Net debt rose to €21.3 billion, partly due to continued share buybacks, €419 million in Q3 alone, and the impact of acquisitions such as U.S. healthcare specialist SDS Rx.
The group reaffirmed its 2025 guidance of at least €6 billion EBIT and around €3 billion free cash flow, saying new U.S. import rules have so far had “only limited impact.” However, management warned that any escalation in trade tensions could have “a significant impact on the Group.”
A shift in strategy
The third-quarter figures confirm that DHL’s current strength rests on cost engineering rather than market momentum. While freight volumes remain muted, the group is investing in regional diversification and automation, with new hubs in Dublin, Barcelona, Helsinki and the Middle East, and an expanding electric delivery network in Germany.
