Kirby’s fourth quarter results fell short of Wall Street’s revenue expectations, leading to a significant negative market reaction. Management cited typical seasonal softness and weather-related delays as primary headwinds, particularly in its marine transportation business, while highlighting strong execution in maintaining margins. CEO David Grzebinski pointed to cost discipline and stable customer demand in the coastal segment as mitigating factors, noting, “Our teams worked hard on controlling costs, operating safely, and protecting margins.” Persistent weakness in the conventional oil and gas market also weighed on distribution and services results.
Is now the time to buy KEX? Find out in our full research report (it’s free for active Edge members).
Kirby (KEX) Q4 CY2025 Highlights:
- Revenue: $851.8 million vs analyst estimates of $863.8 million (6.2% year-on-year growth, 1.4% miss)
- Adjusted EPS: $1.68 vs analyst estimates of $1.63 (3.2% beat)
- Adjusted EBITDA: $200.6 million vs analyst estimates of $191.8 million (23.5% margin, 4.6% beat)
- Operating Margin: 15.2%, up from 6.3% in the same quarter last year
- Market Capitalization: $6.59 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Kirby’s Q4 Earnings Call
- Reed Seay (Stephens Inc.) asked about the drivers behind Q4 term contract pricing softness and how it reflects customer demand outlook. CEO David Grzebinski explained the softness was due to near-term demand issues, but noted spot prices have rebounded and customer sentiment has improved for Q1.
- Ken Hoexter (Bank of America) questioned the wide range in earnings guidance for the year and whether power generation delivery timing or inland pricing expectations were the main contributors. Grzebinski cited lumpy power gen deliveries and cautious optimism on inland pricing, with guidance reflecting both upside and lingering demand uncertainty.
- Jonathan Chappell (Evercore ISI) pressed management on whether margin guidance for distribution and services was conservative given the strong power gen performance. Grzebinski clarified that margins in power gen vary by product mix, with higher engineering content yielding better margins, and that service annuity opportunities will grow with installed base expansion.
- Sherif Elmaghrabi (BTIG) inquired about growth capital allocation and trends in newbuild barge pricing. Grzebinski and President Christian O’Neil indicated growth CapEx is mainly for internal upgrades, with newbuild pricing stable but labor costs remaining high and retirements still outpacing new builds.
- Benjamin Nolan (Citi) asked about the impact of winter storms on Q1 marine volumes and the sustainability of power generation growth. Management described the weather impact as manageable and reiterated that power gen growth should continue, though quarterly results may remain lumpy due to OEM supply constraints.
Catalysts in Upcoming Quarters
Looking forward, the StockStory team will be monitoring (1) sustained improvements in inland and coastal barge utilization and spot pricing, (2) the pace and mix of power generation equipment deliveries, particularly expansion into higher-margin behind-the-meter systems, and (3) the impact of inflationary pressures, including wage and medical costs, on operating margins. Execution on supply chain management and progress in growing the service business will also be important indicators.
Kirby currently trades at $121.51, down from $128.13 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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