GXO Logistics Q2 Earnings Call Highlights

GXO Logistics Q2 Earnings Call Highlights

Key Points Strong commercial momentum: GXO reported second-quarter revenue of $3.4 billion, up 4% year over year, and secured $410 million in new business wins. Management cited more than $1 billion in expected incremental revenue for 2026 and approximately $353 million secured for 2027. 2026 outlook reaffirmed: The company maintained its forecasts for 4%–5% organic revenue growth, adjusted EBITDA of $945 million–$965 million, adjusted EPS of $2.95–$3.15, and free-cash-flow conversion of 30%–40%. Margins are expected to improve in the second half as new contracts ramp and productivity initiatives take effect. Technology and financial priorities: GXO plans to deploy its AI platform across about 50 sites and 20,000 robots in 2026, while targeting long-term EBIT margins above 6%. Net leverage fell to 2.6 times, the company repaid $400 million of bonds, and it resumed share repurchases.

GXO Logistics NYSE: GXO reported second-quarter revenue of $3.4 billion, up 4% year over year and 3.4% on an organic basis, as the contract logistics provider pointed to its strongest commercial quarter in three years and reaffirmed its 2026 financial outlook. Adjusted EBITDA totaled $219 million, while adjusted diluted earnings per share were $0.59. Adjusted EBITDA margin was 6.4%, unchanged from the second quarter of 2025. Chief Financial Officer Mark Suchinski said revenue was affected by the timing of new contract startups and exits, but the company expects margin improvement in the second half as new business ramps and cost and technology initiatives gain traction.

The company tightened several full-year guidance ranges while retaining their midpoints. GXO continues to expect 2026 organic revenue growth of 4% to 5%, adjusted EBITDA of $945 million to $965 million, adjusted diluted EPS of $2.95 to $3.15, and free-cash-flow conversion of 30% to 40%.

Commercial Wins and 2027 Visibility Chief Executive Officer Patrick Kelleher said GXO secured $410 million in new business wins during the quarter, an increase of more than 30% from the prior year. First-half wins reached nearly $640 million, up about 20% year over year. Roughly 40% of new wins came from the company’s strategic growth verticals, including aerospace and defense, technology and data centers, industrials, and life sciences.

GXO said it has secured more than $1 billion in expected incremental new-business revenue for 2026, along with approximately $353 million of secured revenue for 2027. Its sales pipeline expanded to $2.7 billion after the quarter ended, according to management. Kelleher said the company’s commercial strategy has emphasized business-to-business verticals requiring complex supply-chain operations, regulated-environment capabilities and precision execution. He also cited a greater focus on expanding work with existing customers and competing for business from other third-party logistics providers. Among the company’s wins and expanded customer relationships were Nike, Marks & Spencer, PepsiCo and Ahold. GXO also cited new or expanded aerospace and defense work with Raytheon, Boeing and IAG, a new hyperscaler relationship in the technology sector, and a semiconductor logistics win in Malaysia. Chief Strategy Officer Kristine Kubacki said first-half wins in GXO’s strategic growth verticals were running at nearly three times the prior-year pace. She added that 27% of the company’s pipeline is now in those verticals. In North America, second-quarter pipeline was up 34% year over year, while first-half wins increased 85...