Maersk is cutting about 1,000 jobs, or nearly 17 percent of its roughly 6,000 corporate positions, as the ocean carrier prepares for a further freight rate slump and possible ripple effects of a broader Red Sea return.
The headcount reduction will cut corporate costs by $180 million per year and represents less than 1 percent of the more than 107,000 total staff employed at the container shipping line at years’ end.
For the fourth quarter, Maersk’s total revenue declined 8.7 percent to $13.3 billion, with the company seeing net losses of $27 million. Average freight rates declined 23 percent year over year and 8.8 percent sequentially to $2,046 per 40-foot container. The tanking freight rates had a $2.1 billion impact on the company’s 94 percent pre-tax profit decline to $118 million.
Maersk largely attributes the freight rate decline to continued trade volatility and increasing supply overcapacity, with average fleet capacity increasing 4.3 percent to 4.6 million 20-foot equivalent units (TEUs).
“We expect container shipping rates to develop adversely” throughout 2026, Maersk CEO Vincent Clerc said in a Thursday earnings call.
In the near term, rates are expected to deteriorate.
According to Drewry’s World Container Index (WCI) released Thursday morning, ocean spot freight rates decreased 7 percent from the week prior to $1,959 per 40-foot container. Those rates are currently flat with those in early November and December.
Weak demand ahead of anticipated factory closures during the Lunar New Year holiday in China has led to more blank sailings in the three weeks ahead, Drewry says, leading the maritime research firm to project further spot rate declines in the coming weeks.
A larger-scale return to the Red Sea will play a role for how the freight rate ecosystem will play out in 2026, with Maersk rerouting its weekly India-to-U.S. MECL service back through the Suez Canal in January.
In tandem with Gemini Cooperation partner Hapag-Lloyd, the company is taking it further this month by shifting an India-to-Mediterranean Sea loop back to the trade artery. The Red Sea return would shorten transit times on the route by 19 days, but less time at sea will also weigh on freight rates.
Maersk’s guidance for 2026 reflects a variety of different scenarios for Red Sea returns.
“If we return fast and full to the Suez, we will see probably more pressure on the freight rate because there is a bigger gap that we need to close at once,” said Clerc. “If we have an orderly, slow, gradual return, we might be able to manage it better.”
The combination of more ships returning to the Suez Canal, alongside the introduction of new vessels, leads Maersk to anticipate overcapacity of 4 percent to 8 percent in 2026—marking yet another headwind to freight rates.
“For that to resolve itself, you will need to see some scrapping. There is a lot of pent-up capacity that needs to get scrapped and didn’t get scrapped since Covid, basically for six years. And there is also tonnage that needs to be returned. So that will create a few quarters that are going to be a bit bumpy,” Clerc said. “It really depends how quickly the industry reacts to the current state of overcapacity.”
Maersk’s pre-tax profit outlook for 2026 ranges between $1 billion and a more bearish $1.5 billion loss. On a similar note, free cash flow is forecast to be anywhere between no income generated and a $3 billion loss.
The company’s stock fell 5 percent Thursday morning on the earnings release.
As far as expanding its presence in the Red Sea again, Maersk is still monitoring the situation to determine the safety of the region.
According to Clerc, Maersk believes the current environment is safe for a “phase one” return where ships can travel the area if they are flanked by a military escort, which the Gemini loop is using.
The CEO said “it’s a bit premature” for Maersk vessels to sail through the passage without a companion ship, so “there is certain limit to what we can do.”
“There is limited escort capacity,” Clerc said. “At some point, we need to get into a situation where the temperature comes further down, where we feel it is also safe for us to reopen services, even if we don’t have an escort. What probably would trigger the difference between what we have announced so far and a fuller return, would be the ability to see that we can move without the military escort.”
Maersk’s earnings followed a report from rival Ocean Network Express (ONE) that saw the Singapore-headquartered carrier incur an $88 million net loss in its third quarter. Revenue for the container shipping firm declined 16 percent year over year to $4.1 billion in the period.
Jeremy Nixon, CEO of ONE, said in a statement that the results reflect “a challenging operating environment as we continue to navigate the complexities of the current global landscape.”
Cargo movement on the Asia-to-North America trade lane slowed due to front-loading in the first half, decreasing 4.6 percent quarter over quarter and 4.9 percent annually, the company said in its earnings presentation.
