Shipping Giant Slips to Nearly $90 Million Loss as Freight Rates Sink

Due to softer cargo volumes and falling freight rates, Ocean Network Express (ONE) recorded a net loss of USD 88 million in the third quarter of fiscal year 2025.

Revenue reached USD 4.074 billion, but profitability declined sharply. EBITDA fell year over year from USD 2.4 billion to USD 1.2 billion, while EBIT dropped from USD 1.9 billion to USD 667 million, indicating that margins were heavily compressed despite relatively stable shipment volumes.

Oversupply Continues to Pressure Freight Rates

ONE operates more than 260 container vessels with total capacity exceeding 2 million TEU, ranking sixth globally among liner shipping companies. Even at this scale, the company remains exposed to the industry downturn.

In recent years, new vessel deliveries have expanded global capacity faster than demand growth. As a result, competition has shifted toward price, pushing freight rates lower even though cargo volumes have not collapsed.

Frontloading on Asia–U.S. Routes Backfires

In the first half of 2025, many shippers accelerated shipments to avoid potential U.S. tariffs, leading to frontloading on Asia–U.S. routes. This temporarily supported volumes but reduced demand later in the year.

As a result, eastbound Asia–U.S. volumes declined from 730,000 TEU to 673,000 TEU, while Asia–Europe volumes also softened. These routes are the industry’s primary profit drivers, so even modest volume declines had an outsized impact on earnings.

Unit Economics Deteriorate Despite Stable Volumes

The core issue was not volume, but revenue per container. Average freight rates on Asia–U.S. routes fell by about 40 basis points, while Asia–Europe rates declined by roughly 42 basis points.

ONE’s CEO Jeremy Nixon noted that the results reflect a highly challenging operating environment, with the company focusing on disciplined capacity management and cost control to maintain resilience.

While management expects some recovery in volumes and rates next quarter, continued detours around the Red Sea—forcing vessels to reroute via the Cape of Good Hope—mean higher costs and a slower path to profit recovery.