DHL 30% profit growth led by heavy air freight

DHL Express operating income soared 64% as it continued to benefit from increased weight per shipment, a core metric for assessing asset utilization and charging customers, and disinclined yield and cost management. Weight per day for time-definite international shipments is up six points from the first quarter as the company targets more industrial customers. Temporary capacity shortages in the air cargo market, especially around the Middle East conflict area, had a positive earnings impact of about $172.6 million as volume that normally would have gone to forwarders ended up on overnight DHL flights.

DHL Express, along with FedEx and UPS, continue to take a greater share of the general air freight market as they realign capacity on their in-house airlines to carry heavier freight and move away from low-priced, light parcels as the post-Covid boom in e-commerce normalizes. Express carriers are now responsible for moving more than half of all international air cargo tonnage, DHL said. According to Boeing and Airbus long-range forecasts, express air business will grow at a faster clip than general air cargo over the next 20 years. 

CEO Tobias Meyer told analysts that DHL Express is positioned to make significant gains in air freight market share because the network’s scale, design and fuel-efficient freighters enable it to offer logistics companies better speed at affordable prices compared to regular commercial airlines.

“It’s the reliability, the speed and the predictability of the integrator model which is superior to the general air freight product. That is attractive not only for small spare parts, but also for bigger parts like turbines used in aviation or for power generation,  and other complex, high-value products,” he said. 

DHL Express, for example, recently helped a manufacturer of racing-grade motorcycles ship units from China and distribute them across Europe, using Express air assets to move the heavy shipments with greater speed, control and visibility. 

Express heavyweight “is not a cheap forwarding product in our premium network. It is a heavier shipment in an express network with express pricing where you take into consideration the cost to produce” and revenue drops quickly to the bottom line, said CFO Melani Kries.

DHL, FedEx and UPS have each placed greater strategic focus on serving the B2B sector and key industrial verticals that require specialized logistics, and command higher rates, while gradually relinquishing many low-margin, last-mile delivery relationships with online retailers.  

DHL continues to expand capabilities in premium logistics categories such as life sciences and healthcare, next-generation energy — electric vehicles, wind and battery storage — and data centers, using a cross-divisional approach to support customers. DHL, for example, is expanding its healthcare logistics network in the United States, United Kingdom, Singapore and South Korea. 

DHL experienced a significant increase in activity for AI-related projects, including warehousing, international transportation of parts and components for data centers, arranging inbound logistics to the construction site, and staging material. 

“There’s obviously high urgency to bring such sites into operation, and that urgency then translates into goods that need interim storage and sequencing to alleviate bottleneck capacities at the construction, and us also taking over even certain installation services on site. That’s the two areas. We also expect significant spare parts business to follow as those installations mature,” the DHL chief said on the earnings call. Data center logistics revenue is expected to grow indefinitely, he added.

DHL’s cross-border freight management business posted a 22% gain in operating profit behind growing air and ocean volumes and higher freight rates. Gross profit per unit of air freight increased 28%.

DHL Supply Chain, which provides warehousing and distribution services, grew revenue by 13%. The unit lost money because of a one-time organizational change that substantially boosted earnings in the second quarter of 2025, skewing what would otherwise be a positive comparison, DHL said. During the first half, more than 700 artificial intelligence and robotics projects went live, accelerating digitalization and automation across operations.

DHL eCommerce continues to be impacted by the accounting impact of the merger with UK-based Evri and the resulting loss of the revenue contribution from the United Kingdom. Excluding consolidation and currency effects, the division recorded strong revenue growth, supported by the continued structural trend towards e-commerce. On July 27, DHL announced plans to acquire Lithuania-based Venipak to boost its competitiveness in the Baltic states. 

Growing German domestic and international parcel business helped offset declining mail volumes at Post & Parcel Germany, but higher transportation and personnel costs weighed on profits. The company said it remains focused on improving productivity, maintaining cost discipline and enhancing its processes.

DHL’s cost-management program, Fit for Growth, has delivered $1.2 billion in planned savings six months ahead of schedule, including through digitization and process improvements, according to management.

“We are not single-minded about cost,” Meyer explained. “We are a service organization and particularly in Global Forwarding it is extremely important to have great people and have great capabilities. We see ourselves having that balanced view and not being single-mindedly obsessed about cost.  

CapEx

Capital expenditures were 25% higher in the first half versus 2025, at $1.5 billion, as DHL continues to invest in its network and new capabilities in line with its 2030 growth strategy. 

FedEx Corp. and UPS, by comparison, have been reducing capital spending in recent quarters as they wring excess capacity from their freight networks, although they still invest at comparable levels to DHL after starting at a higher point. At FedEx, capital spending for the fiscal year ended May 31 totaled $3.8 billion, a decrease of $246 million, or 6%, compared with fiscal 2025. Capital spending as a percentage of revenue declined to 4%, the lowest annual level in FedEx history. 

Meyer said DHL is striking a balance between investing in growth and returning profits to shareholders.

“We are very mindful not to increase the capital intensity in our existing business, but we want to fuel growth where CapEx is required to realize such growth. That is the case in Express, but also in Supply Chain where we have a significant demand and a very good success track record to enable new real estate and new buildings for our customers and also increasingly automate and deploy robotics in those solutions,” he explained.

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