8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report: November 2, 2010

(Date of earliest event reported)

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.

(Exact name of registrant as specified in its charter)

Washington	000-13468	91-1069248
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(IRS Employer Identification Number)

1015 Third Avenue, 12th Floor, Seattle, Washington	98104
(Address of principal executive offices)	(Zip Code)

(206) 674-3400

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

The following information is furnished pursuant to Item 2.02, “Results of Operations and Financial Condition.”

On November 2, 2010, Expeditors International of Washington, Inc. issued a press release announcing third quarter 2010 financial results. A copy of the press release is furnished as Exhibit 99.1 to this report.

Item 9.01 Financial Statements and Exhibits.

(d)	The following items are filed as exhibits to this report:
99.1	Press release, dated November 2, 2010 issued by Expeditors International of Washington, Inc.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
November 2, 2010	/S/    BRADLEY S. POWELL
	Bradley S. Powell, Chief Financial Officer

3

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	Press Release of Expeditors International of Washington, Inc., dated November 2, 2010, reporting third quarter 2010 financial results.

4

EX-99.1

Exhibit 99.1

	EARNINGS RELEASE
By:	Expeditors International of Washington, Inc.
	1015 Third Avenue, Suite 1200
	Seattle, Washington 98104
	CONTACTS:	R. Jordan Gates	Bradley S. Powell
		President and Chief Operating Officer	Chief Financial Officer
		(206) 674-3427	(206) 674-3412

FOR IMMEDIATE RELEASE

EXPEDITORS REPORTS THIRD QUARTER 2010 EPS of $.44 PER SHARE ¹

SEATTLE, WASHINGTON – November 2, 2010, Expeditors International of Washington, Inc. (NASDAQ:EXPD) today announced quarterly net earnings attributable to shareholders of $96,105,000 for the third quarter of 2010, as compared with $57,752,000 for the same quarter of 2009, an increase of 66%. Net revenues for the third quarter of 2010 increased 32% to $458,743,000 as compared with $346,512,000 reported for the third quarter of 2009. Total revenues and operating income were $1,667,559,000 and $159,621,000 in 2010, as compared with $1,037,327,000 and $96,246,000 for the same quarter of 2009, increases of 61% and 66%, respectively. Diluted net earnings attributable to shareholders per share for the third quarter of 2010 were $.44, as compared with $.27 for the same quarter in 2009, an increase of 63%.

For the nine months ended September 30, 2010, net earnings attributable to shareholders was $247,670,000 as compared with $171,082,000 in 2009, an increase of 45%. Net revenues for the nine months increased to $1,239,424,000 from $1,013,074,000 for 2009, up 22%. Total revenues and operating income for the nine months were $4,385,438,000 and $398,658,000 in 2010, as compared with $2,845,372,000 and $274,647,000 for the same period in 2009, increases of 54% and 45%, respectively. Diluted net earnings attributable to shareholders per share for the first three quarters of 2010 were $1.14, as compared with $.79 for the same period of 2009, an increase of 44%.

“Sometimes even the word ‘Wow!’ would be a classical understatement. After last year, we had hoped 2010 would be a stronger year, but having operating income be up 66% and 18% over the 2009 and 2008 third quarters, respectively, is way beyond anything we would have dared to predict 12 months ago,” said Peter J. Rose, Chairman and Chief Executive Officer. “It is particularly reassuring when market share gains made when volumes were down, actually show up en masse, when the market turns. To paraphrase an old adage, ‘You can tell a Company by who their employees, customers and service providers are.’…and we certainly are fortunate to have a great cadre of all three. We continue to be very grateful to them all. At the end of the day, this business is about people. We think these results illustrate why we are so confident that we have the very best,” Rose continued.

“The thing we’ve been most impressed with internally is how productivity measures and efficiency gains have helped us absorb these large increases in business volumes. Operating income as a percentage of net revenue was at a record high for us this quarter,” Rose commented. “We couldn’t be more proud of the ingenuity and the commitment to operational excellence and customer service that was shown by our people. This is something we feel is truly significant to who we are and what we try to accomplish. As we move forward, we will continue to focus on the basics that we’ve always relied on to keep us grounded, even through the tough times: flawless customer service, effective sales, seamless execution and comprehensive compliance. Those are our objectives, and this year, so far at least, we seem to be doing just fine,” Rose concluded.

Expeditors is a global logistics company headquartered in Seattle, Washington. The company employs trained professionals in 183 full-service offices, 65 satellite locations and 2 international service centers located on six continents linked into a seamless worldwide network through an integrated information management system. Services include air and ocean freight forwarding, vendor consolidation, customs clearance, marine insurance, distribution and other value added international logistics services.

¹ Diluted earnings attributable to shareholders per share.

NOTE: See Disclaimer on Forward-Looking Statements on the following page of this release.

Expeditors International of Washington, Inc.

Third Quarter 2010 Earnings Release

November 2, 2010

Expeditors International of Washington, Inc.

Financial Highlights

Three months and Nine months ended

September 30, 2010 and 2009

(Unaudited)

(in 000’s except share data)

	Three Months Ended September 30,							Nine Months Ended September 30,
	2010		2009		% Increase			2010		2009		% Increase
Revenues	$	1,667,559	$	1,037,327		61	%	$	4,385,438	$	2,845,372		54	%
Net revenues	$	458,743	$	346,512		32	%	$	1,239,424	$	1,013,074		22	%
Operating income	$	159,621	$	96,246		66	%	$	398,658	$	274,647		45	%
Net earnings attributable to shareholders	$	96,105	$	57,752		66	%	$	247,670	$	171,082		45	%
Diluted earnings attributable to shareholders	$	.44	$	.27		63	%	$	1.14	$	.79		44	%
Basic earnings attributable to shareholders	$	.45	$	.27		67	%	$	1.17	$	.81		44	%
Weighted average diluted shares outstanding		216,342,380		216,684,079					216,497,838		216,582,370
Weighted average basic shares outstanding		212,392,286		212,241,480					212,306,521		212,153,404

Percentage increases in same store net revenue and operating income were approximately the same as amounts reported above.

During the third quarter of 2010, the Company did not open or close any offices.

Investors may submit written questions via e-mail to: investor@expeditors.com

Or by fax to: (206) 674-3459

Questions received by the end of business on November 5, 2010 will be considered in management’s 8-K “Responses to Selected Questions” expected to be filed on or about November 29, 2010.

Disclaimer on Forward-Looking Statements:

Certain portions of this release contain forward-looking statements which are based on certain assumptions and expectations of future events that are subject to risks and uncertainties, including comments on economic trends, improving business climate, positive trends in business volumes, ability to improve productivity and acquire market share. Actual future results and trends may differ materially from historical results or those projected in any forward-looking statements depending on a variety of factors including, but not limited to, our ability to maintain consistent and stable operating results, future success of our business model, ability to perpetuate profits, changes in customer demand for Expeditors’ services caused by a general economic slow-down, customers’ inventory build-up, decreased consumer confidence, volatility in equity markets, energy prices, political changes, regulatory changes or the unpredictable acts of competitors and other risks, risk factors and uncertainties detailed in our Annual and Quarterly Reports filed with the Securities and Exchange Commission.

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share data)

(Unaudited)

	September 30, 2010		December 31, 2009
Assets
Current assets:
Cash and cash equivalents	$	1,057,226	$	925,929
Short-term investments		601		655
Accounts receivable, net		1,082,733		810,369
Deferred Federal and state income taxes		8,325		8,338
Other current assets		34,760		42,539
Total current assets		2,183,645		1,787,830
Property and equipment, net		493,046		495,701
Goodwill, net		7,927		7,927
Other intangibles, net		3,965		4,938
Other assets, net		27,600		27,326
	$	2,716,183	$	2,323,722
Liabilities and Equity
Current liabilities:
Accounts payable		700,585		546,675
Accrued expenses, primarily salaries and related costs		188,919		145,545
Federal, state and foreign income taxes		31,761		16,166
Total current liabilities		921,265		708,386
Deferred Federal and state income taxes		58,800		53,989
Commitments and contingencies
Shareholders’ equity:
Preferred stock; none issued		—		—
Common stock, par value $.01 per share; issued and outstanding 212,090,154 shares at September 30, 2010 and 212,025,494 shares at December 31, 2009		2,121		2,120
Additional paid-in capital		5,823		18,265
Retained earnings		1,715,876		1,532,018
Accumulated other comprehensive income		4,802		604
Total shareholders’ equity		1,728,622		1,553,007
Noncontrolling interest		7,496		8,340
Total equity		1,736,118		1,561,347
	$	2,716,183	$	2,323,722

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EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(In thousands, except share data)

(Unaudited)

	Three months ended						Nine months ended
	September 30,						September 30,
	2010			2009			2010			2009
Revenues:
Airfreight services	$	751,555		$	457,405		$	2,043,819		$	1,203,220
Ocean freight and ocean services		599,280			331,454			1,474,137			949,380
Customs brokerage and other services		316,724			248,468			867,482			692,772
Total revenues		1,667,559			1,037,327			4,385,438			2,845,372
Operating expenses:
Airfreight consolidation		578,924			340,746			1,577,289			848,131
Ocean freight consolidation		488,808			247,733			1,190,627			704,850
Customs brokerage and other services		141,084			102,336			378,098			279,317
Salaries and related costs		235,357			194,743			656,310			571,517
Rent and occupancy costs		19,295			18,183			57,221			54,861
Depreciation and amortization		9,085			9,923			27,590			30,125
Selling and promotion		7,877			6,541			22,462			18,310
Other		27,508			20,876			77,183			63,614
Total operating expenses		1,507,938			941,081			3,986,780			2,570,725
Operating income		159,621			96,246			398,658			274,647
Interest income		1,679			2,214			4,938			8,253
Interest expense		(140	)		(325	)		(378	)		(404	)
Other, net		(1,666	)		1,192			9,231			7,826
Other income, net		(127	)		3,081			13,791			15,675
Earnings before income taxes		159,494			99,327			412,449			290,322
Income tax expense		63,456			41,763			164,692			119,575
Net earnings		96,038			57,564			247,757			170,747
Less: net earnings attributable to noncontrolling interest		(67	)		(188	)		87			(335	)
Net earnings attributable to shareholders	$	96,105		$	57,752		$	247,670		$	171,082
Diluted earnings attributable to shareholders per share	$	0.44		$	0.27		$	1.14		$	0.79
Basic earnings attributable to shareholders per share	$	0.45		$	0.27		$	1.17		$	0.81
Dividends declared and paid per common share	$	—		$	—		$	0.20		$	0.19
Weighted average diluted shares outstanding		216,342,380			216,684,079			216,497,838			216,582,370
Weighted average basic shares outstanding		212,392,286			212,241,480			212,306,521			212,153,404

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EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

	Three months ended						Nine months ended
	September 30,						September 30,
	2010			2009			2010			2009
Operating Activities:
Net earnings	$	96,038		$	57,564		$	247,757		$	170,747
Adjustments to reconcile net earnings to net cash provided by operating activities:
Provision for losses on accounts receivable		1,284			(778	)		3,109			791
Deferred income tax (benefit) expense		(565	)		(6,701	)		2,521			(12,945	)
Excess tax benefits from stock plans		(3,470	)		(246	)		(11,589	)		(5,381	)
Stock compensation expense		10,846			10,794			33,047			29,065
Depreciation and amortization		9,085			9,923			27,590			30,125
Gain (loss) on sale of assets		(57	)		8			(461	)		(2	)
Other		387			365			1,232			1,092
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable		(34,203	)		(94,025	)		(266,770	)		120,318
Increase in other current assets		(4,095	)		(803	)		(2,959	)		(2,126	)
Increase (decrease) in accounts payable and accrued expenses		25,330			71,711			190,440			(28,788	)
Increase (decrease) in income taxes payable, net		12,438			(5,350	)		36,770			(3,066	)
Net cash provided by operating activities		113,018			42,462			260,687			299,830
Investing Activities:
Decrease in short-term investments		137			17			107			48
Purchase of property and equipment		(10,953	)		(9,514	)		(26,653	)		(25,336	)
Proceeds from sale of property and equipment		98			48			268			125
Prepayment on long-term land lease		—			(1,898	)		—			(9,242	)
Other		1,208			438			313			(1,153	)
Net cash used in investing activities		(9,510	)		(10,909	)		(25,965	)		(35,558	)
Financing Activities:
Proceeds from issuance of common stock		37,718			25,107			60,958			42,511
Repurchases of common stock		(67,782	)		(34,103	)		(139,450	)		(77,075	)
Excess tax benefits from stock plans		3,470			246			11,589			5,381
Dividends paid		—			—			(42,397	)		(40,276	)
Distributions to noncontrolling interest		(963	)		(1,009	)		(963	)		(1,009	)
Purchase of noncontrolling interest		—			—			—			(2,122	)
Net cash used in financing activities		(27,557	)		(9,759	)		(110,263	)		(72,590	)
Effect of exchange rate changes on cash and cash equivalents		20,975			9,493			6,838			14,559
Increase in cash and cash equivalents		96,926			31,287			131,297			206,241
Cash and cash equivalents at beginning of period		960,300			915,982			925,929			741,028
Cash and cash equivalents at end of period	$	1,057,226		$	947,269		$	1,057,226		$	947,269
Interest and taxes paid:
Interest	$	140			317		$	379			397
Income taxes		52,407			46,607			129,249			121,717

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EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. AND SUBSIDIARIES

Business Segment Information

(In thousands)

(Unaudited)

	United States		Other North America		Latin America		Asia		Europe and Africa		Middle East and India		Austral- asia		Elimi- nations			Consoli- dated
Three months ended September 30, 2010
Revenues from unaffiliated customers	$	361,120		43,380		20,400		947,751		190,350		83,451		21,107					1,667,559
Transfers between geographic areas		28,571		3,567		4,190		6,118		11,045		4,448		2,475		(60,414	)		—
Total revenues	$	389,691		46,947		24,590		953,869		201,395		87,899		23,582		(60,414	)		1,667,559
Net revenues	$	179,290		20,911		13,181		140,715		68,158		23,962		12,526					458,743
Operating income	$	61,735		6,846		3,837		60,299		17,128		6,029		3,747					159,621
Identifiable assets	$	1,437,318		78,347		48,887		532,736		433,020		139,478		41,328		5,069			2,716,183
Capital expenditures	$	5,297		92		354		1,502		2,963		394		351					10,953
Depreciation and amortization	$	4,882		316		223		1,708		1,184		609		163					9,085
Equity	$	1,121,817		40,708		23,974		318,005		155,428		80,774		28,205		(32,793	)		1,736,118
Three months ended September 30, 2009
Revenues from unaffiliated customers	$	246,066		32,214		16,552		516,897		147,354		60,269		17,975					1,037,327
Transfers between geographic areas		18,293		1,716		3,461		4,227		6,487		3,738		2,595		(40,517	)		—
Total revenues	$	264,359		33,930		20,013		521,124		153,841		64,007		20,570		(40,517	)		1,037,327
Net revenues	$	139,232		16,667		10,960		89,490		57,857		20,771		11,535					346,512
Operating income	$	37,502		4,090		2,611		33,303		9,650		5,424		3,666					96,246
Identifiable assets	$	1,135,327		73,500		37,216		435,584		376,050		121,079		35,518		2,613			2,216,887
Capital expenditures	$	7,656		186		171		248		506		588		159					9,514
Depreciation and amortization	$	5,048		358		245		1,868		1,593		646		165					9,923
Equity	$	964,177		44,455		14,982		290,779		137,278		70,531		22,487		(24,734	)		1,519,955
Nine months ended September 30, 2010
Revenues from unaffiliated customers	$	979,675		120,667		55,317		2,422,208		525,064		222,599		59,908					4,385,438
Transfers between geographic areas		72,743		7,722		12,082		16,468		29,407		11,918		7,393		(157,733	)		—
Total revenues	$	1,052,418		128,389		67,399		2,438,676		554,471		234,517		67,301		(157,733	)		4,385,438
Net revenues	$	489,231		56,757		37,428		361,512		192,135		66,195		36,166					1,239,424
Operating income	$	152,425		16,317		11,155		148,652		43,870		15,953		10,286					398,658
Identifiable assets	$	1,437,318		78,347		48,887		532,736		433,020		139,478		41,328		5,069			2,716,183
Capital expenditures	$	13,137		417		988		3,513		6,415		1,729		454					26,653
Depreciation and amortization	$	14,753		1,023		639		5,112		3,721		1,828		514					27,590
Equity	$	1,121,817		40,708		23,974		318,005		155,428		80,774		28,205		(32,793	)		1,736,118
Nine months ended September 30, 2009
Revenues from unaffiliated customers	$	704,962		91,482		47,486		1,373,093		415,479		167,848		45,022					2,845,372
Transfers between geographic areas		54,847		5,340		9,972		11,863		19,086		11,005		7,448		(119,561	)		—
Total revenues	$	759,809		96,822		57,458		1,384,956		434,565		178,853		52,470		(119,561	)		2,845,372
Net revenues	$	399,614		47,718		32,645		275,680		165,623		61,229		30,565					1,013,074
Operating income	$	95,483		11,512		8,691		107,424		26,417		15,362		9,758					274,647
Identifiable assets	$	1,135,327		73,500		37,216		435,584		376,050		121,079		35,518		2,613			2,216,887
Capital expenditures	$	19,268		477		582		1,259		1,847		1,486		417					25,336
Depreciation and amortization	$	15,828		1,031		729		5,714		4,490		1,860		473					30,125
Equity	$	964,177		44,455		14,982		290,779		137,278		70,531		22,487		(24,734	)		1,519,955

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