XPO : First Quarter 2026 Investor Presentation

Published: 2026-04-30 06:58:13 ET XPO

Published on 04/30/2026 at 06:58 am EDT

April 2026

First quarter 2026 highlights

XPO revenue up 7% YoY

XPO adjusted EBITDA up 15% YoY XPO diluted EPS up 47% YoY

XPO adjusted diluted EPS up 38% YoY

LTL adjusted operating income up 20% YoY

LTL adjusted operating ratio of 83.9%, improved by 200 bps YoY

LTL adjusted EBITDA up 16% YoY

LTL linehaul miles outsourced to third-party carriers reduced by 320 bps YoY LTL damage claims ratio below 0.2%, with damages at a record low

LTL maintenance cost per mile reduced by 11% YoY

Improved LTL adjusted OR by 570 bps over three years in a historically soft freight environment

Refer to "Financial Reconciliations" and "Non-GAAP Financial Measures" sections in Appendix for related information.

NORTH AMERICAN LTL

REVENUE $1.23 billion

ADJUSTED EBITDA $290 million

ADJUSTED OPERATING RATIO 83.9%

REVENUE

$2.10 billion

OPERATING INCOME

$174 million

NET INCOME

$101 million

DILUTED EARNINGS PER SHARE

$0.85

ADJUSTED NET INCOME

$121 million

ADJUSTED DILUTED EPS

$1.01

ADJUSTED EBITDA

$319 million

CASH FLOW FROM OPERATING ACTIVITIES

$183 million

First quarter 2026 performance

BY SEGMENT

EUROPEAN TRANSPORTATION

REVENUE $868 million

ADJUSTED EBITDA $33 million

Refer to "Financial Reconciliations" and "Non-GAAP Financial Measures" sections in Appendix for related information.

Our LTL strategy is driving significant margin and earnings expansion

Provide best-in-class service

Invest in network for the long-term

Accelerate yield growth

Drive cost efficiencies

Targets for LTL Growth, Profitability and Efficiency, 2021-2027

Revenue CAGR of 6% to 8% Adjusted EBITDA CAGR of 11% to 13%

Adjusted operating ratio improvement of at least 600 bps

Refer to "Non-GAAP Financial Measures" section in Appendix for related information.

A leading carrier in a compelling industry

5% CAGR: North American LTL industry revenue

$52 billion bedrock industry for the US economy, with over 75% share held by top 10 LTL players

Diverse demand across verticals, with secular growth drivers

Attractive pricing environment, with positive YoY industry pricing

for over a decade

Strong service quality is key gating factor for yield growth and margin expansion

Industry service center capacity has declined over the past decade

Sources: Third-party research; company filings.

Note: Revenue CAGR for periods 2009-2025; industry size and market share data for 2025.

A major player in the supply-chain ecosystem

$4.8 billion

2025 revenue

37,000

customers served

22,000

employees

2025 industry share

626 million

2025 linehaul miles run

13,000

drivers

4th largest

LTL carrier by 2025 revenue

12 million

2025 shipments

34,000

trailers

12.4%

of 2025 revenue allocated to gross capex

16 billion

2025 pounds of freight

299

service centers

Note: Company data for North American LTL segment only as of March 31, 2026, unless otherwise noted as 2025 (full year).

Expansive network of service centers covering 99% of US zip codes

299 service centers

Cross-border and offshore capabilities

Strategic investments in high-demand markets

Note: Service center data as of March 31, 2026.

Strategic mix of blue-chip and local customers

Long-standing relationships - average tenure of top 10 customers is 19 years

Note: Company data for North American LTL segment only as of March 31, 2026; selected customers shown.

Executing on four key levers

Provide best-in-class service

Continually strengthening our value proposition through a world-class service culture

Incentivizing employees to deliver consistently outstanding service quality for customers

Implementing tools for operational excellence in linehaul, dock, and pickup-and-delivery

Invest in network for the long-term

Targeting capex of 8% to 12% of revenue on average through 2027

Expanding linehaul fleet with modern tractors and in-house trailer manufacturing

Investing in network capacity to further improve service and enhance operating leverage

Accelerate yield growth

Delivering above-market pricing gains aligned with service excellence

Expanding accessorial revenue from premium service offerings

Growing share of higher-yielding local channel with scaled-up local salesforce

Deploying AI tools to enhance productivity and reduce operating costs

Insourcing linehaul miles to increase network efficiency, supporting incremental margins in an upcycle

Investing in fleet to drive lower maintenance costs and enhance reliability

Delivering meaningful service improvements

Damage claims as a % of LTL revenue1

LTL growth plan

1.1%

1.0%

0.9%

0.5%

0.2%

0.3%

0.2%

2020 2021 2022 2023 2024 2025 Q1 2026

Service initiatives have driven nearly 90% improvement in damages2 since Q4'21

1 Based on claims payment data.

2 Based on damage frequency data.

Investing in capacity that supports growth and high returns

$1,000

LTL growth plan

14.6%

16.0%

$800

Gross capex ($ millions)

$600

$400

$200

3.8%

$145

5.2%

$197

4.1%

$145

4.8%

$197

9.1%

$424

12.4%

$581

$715

12.4%

$601

14.0%

Gross capex as a % of revenue

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

Tractor age in years as of December 31

2018 2019 2020 2021 2022 20231

5.3

5.1

5.4

5.9

5.0

3.7

2024 2025

4.1

0.0%

Increased excess door capacity to more than 30%

Note: Gross capex and revenue for North American LTL segment only.

1 Excludes the company's December 2023 acquisition of 28 service centers.

Earning price by delivering value through service excellence

Gross revenue per hundredweight (excluding fuel surcharges)

LTL growth plan

$25.39 $25.71

$23.94

$22.21

$21.18

$19.80

$18.63

2020 2021 2022 2023 2024 2025 Q1 2026

Yield, excluding fuel, improved 4% year-over-year in Q1'26

Note: Gross revenue per hundredweight excludes the adjustment required for financial statement purposes in accordance with the company's revenue recognition policy.

Insourcing linehaul miles supports higher incremental margins in an upcycle

Linehaul miles outsourced to third-party carriers, as a % of total linehaul miles

25.2%

23.6% 23.8%

LTL growth plan

20.9%

14.7%

6.7%

5.6%

2020 2021 2022 2023 2024 2025 Q1 2026

Reduced outsourced miles by 320 bps year-over-year in Q1'26

11% to 13% adjusted EBITDA CAGR in North American LTL 2021-2027

Expected components and contributions

Combination of volume gains + pricing over inflation

Operating costs optimized through technology Linehaul insourced from third parties

3% to 4%

11% to 13%

Appendix

European Transportation segment

Unique pan-European transportation platform holds leading positions in key geographies

In France: the #1 full truckload (FTL) broker and the #1 pallet network (LTL) provider

In Iberia (Spain and Portugal): the #1 FTL broker and the #1 LTL provider

In the UK: a market leader in warehousing, a top-tier dedicated truckload provider, and the largest single-owner LTL network

Serves a diverse base of customers with consumer, trade and industrial markets, including many sector leaders that have long-tenured relationships with XPO

Range of services includes dedicated truckload, LTL, FTL brokerage, warehousing, managed transportation, last mile and freight forwarding, as well as multimodal solutions that are customized to reduce CO2e emissions

2026 planning assumptions

For the full year 2026, the company expects:

Total company gross capex of $500 million to $600 million

Interest expense of $205 million to $215 million

Pension income of approximately $14 million

Adjusted effective tax rate of 23% to 24%

Diluted share count of approximately 118 million

Refer to "Non-GAAP Financial Measures" on page 25 of this document.

Financial reconciliations

The following table reconciles XPO's net income for the periods ended March 31, 2026 and 2025 to adjusted EBITDA for the same

periods.

Reconciliation of net income to adjusted EBITDA

In millions

Three Months Ended March 31,

(Unaudited)

2026

2025

Change %

Net income

$ 101

$ 69

46.4%

Debt extinguishment loss

Interest expense

Income tax provision

Depreciation and amortization expense

131

123

Legal matters (1)

(11)

Transaction and integration costs

Restructuring costs

Adjusted EBITDA

$ 319

$ 278

14.7%

Amounts may not add due to rounding.

1 Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.

Financial reconciliations (cont.)

The following table reconciles XPO's net income for the periods ended March 31, 2026 and 2025 to adjusted net income for the same

periods.

Reconciliation of adjusted net income and adjusted diluted earnings per share

In millions, except per share data (Unaudited)

Three Months Ended

March 31,

2026 2025

Net income

$ 101

$ 69

Debt extinguishment loss

Legal matters (1)

(11)

Transaction and integration costs

Restructuring costs

Income tax associated with the adjustments above (2)

(3)

(5)

European legal entity reorganization (3)

(3)

Adjusted net income

$ 121

$ 87

Adjusted diluted earnings per share

$ 1.01

$ 0.73

Weighted-average common shares outstanding

Diluted weighted-average common shares outstanding

119

120

Amortization of acquisition-related intangible assets

Amounts may not add due to rounding.

1 Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.

2 The income tax rate applied to reconciling items is based on the GAAP annual effective tax rate, excluding discrete items, non-deductible compensation, losses for which no tax benefit can be recognized, and contribution- and margin-based taxes.

3 Reflects an adjustment recognized during the first quarters of 2026 and 2025 to the tax benefit recognized in the second quarter of 2024 related to a legal entity reorganization within our European Transportation segment.

Financial reconciliations (cont.)

The following table reconciles XPO's operating income attributable to its North American less-than-truckload ("LTL") segment for the periods ended March 31, 2026 and 2025 to adjusted operating income, adjusted operating ratio and adjusted EBITDA.

Reconciliation of North American LTL adjusted operating income, adjusted operating ratio and adjusted EBITDA

In millions

Three Months Ended March 31,

(Unaudited)

2026 2025

Change %

Revenue (excluding fuel surcharge revenue)

$ 1,028

$ 994

3.4%

Fuel surcharge revenue

201

178

12.9%

Revenue

1,229

1,172

4.9%

Salaries, wages and employee benefits

642

615

4.4%

Purchased transportation

-18.9%

Fuel, operating expenses and supplies (1)

236

232

1.7%

Operating taxes and licenses

0.0%

Insurance and claims

-25.0%

(Gains) losses on sales of property and equipment

Depreciation and amortization

7.8%

Operating income

189

158

19.6%

Operating ratio (2)

84.6%

86.5%

Amortization expense

Gains on real estate transactions

(2)

Adjusted operating income

$ 198

$ 165

20.0%

Adjusted operating ratio (3)

83.9%

85.9%

Depreciation expense

Pension income

Gains on real estate transactions

Adjusted EBITDA (4)

$ 290

$ 250

16.0%

Amounts may not add due to rounding. NM - Not meaningful.

1 Fuel, operating expenses and supplies includes fuel-related taxes.

2 Operating ratio is calculated as (1 - (operating income divided by revenue)) using the underlying unrounded amounts.

3 Adjusted operating ratio is calculated as (1 - (adjusted operating income divided by revenue)) using the underlying unrounded amounts; adjusted operating margin is the inverse of adjusted operating ratio.

4 Adjusted EBITDA is used by our chief operating decision maker to evaluate segment profit (loss) in accordance with ASC 280.

Refer to "Non-GAAP Financial Measures" on page 25 of this document.

Financial reconciliations (cont.)

The following table reconciles XPO's operating income attributable to its North American less-than-truckload ("LTL") segment for the periods ended March 31, 2026 and 2023 to adjusted operating income and adjusted operating ratio.

Reconciliation of North American LTL adjusted operating income and adjusted operating ratio

In millions

Three Months Ended

(Unaudited)

March 31,

2026

2023

Revenue (excluding fuel surcharge revenue)

$ 1,028

$ 903

Fuel surcharge revenue

201

217

Revenue

1,229

1,120

Salaries, wages and employee benefits

642

555

Purchased transportation

Fuel, operating expenses and supplies (1)

236

248

Operating taxes and licenses

Insurance and claims

(Gains) losses on sales of property and equipment

Depreciation and amortization

Restructuring costs

Operating income

189

103

Operating ratio (2)

84.6%

90.8%

Amortization expense

Restructuring costs

Gains on real estate transactions

Adjusted operating income

$ 198

$ 117

Adjusted operating ratio (3)

83.9%

89.6%

Amounts may not add due to rounding.

1 Fuel, operating expenses and supplies includes fuel-related taxes.

2 Operating ratio is calculated as (1 - (operating income divided by revenue)) using the underlying unrounded amounts.

Refer to "Non-GAAP Financial Measures" on page 25 of this document.

Non-GAAP financial measures

As required by the rules of the Securities and Exchange Commission ("SEC"), we provide reconciliations of the non-GAAP financial measures contained in this document to the most directly comparable measures under GAAP, which are set

forth in the financial tables attached to this document.

This document contains the following non-GAAP financial measures: adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA") on a consolidated basis; adjusted net income; adjusted diluted earnings per share ("adjusted EPS"); adjusted operating income for our North American Less-Than-Truckloadsegment; adjusted operating ratio for our North American Less-Than-Truckload segment; and adjusted effective tax rate.

We believe that the above adjusted financial measures facilitate analysis of our ongoing business operations because they exclude items that may not be reflective of, or are unrelated to, XPO and its business segments' core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. Other companies may calculate these non-GAAP financial measures differently, and therefore our measures may not be comparable to similarly titled measures of other companies. These non-GAAPfinancialmeasures should only be used as supplementalmeasures of our operating performance.

Adjusted EBITDA, adjusted net income, adjusted EPS, adjusted operating income and adjusted operating ratio include adjustments for transaction and integration costs, as well as restructuring costs, and other adjustments as set forth in the attached tables. Transaction and integration adjustments are generally incremental costs that result from an actual or planned acquisition, divestiture or spin-off and may include transaction costs, consulting fees, stock-based compensation, retention awards, internal salaries and wages (to the extent the individuals are assigned full-time to integration and transformation activities) and certain costs related to integrating and converging IT systems. Restructuring costs primarily relate to severance costs associated with business optimization initiatives. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and evaluating XPO's and each business segment's ongoing performance.

We believe that adjusted EBITDA improves comparability from period to period by removing the impact of our capital structure (interest and financing expenses), asset base (depreciation and amortization), tax impacts and other adjustments as set out in the attached tables that management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in our underlying businesses. We believe that adjusted net income and adjusted EPS improve the comparability of our operating results from period to period by removing the impact of certain costs and gains that management has determined are not reflective of our core operating activities, including amortization of acquisition-related intangible assets, transaction and integration costs, restructuring costs and other adjustments as set out in the attached tables. We believe that adjusted operating income and adjusted operating ratio improve the comparability of our operating results from period to period by removing the impact of certain transaction and integration costs and restructuring costs, as well as amortization expense and other adjustments as set out in the attached tables. We believe that adjusted effective tax rate improves comparability of our effective tax rate, by excluding the tax effect of special items.

With respect to our targets for: (i) the North American less-than-truckload segment's adjusted EBITDA CAGR and adjusted operating ratio for the six-year period 2021 through 2027 and (ii) the 2026 adjusted effective tax rate, a reconciliation of these non-GAAP measures to the corresponding GAAP measures is not available without unreasonable effort due to the variability and complexity of the reconciling items described above that we exclude from these non-GAAP target measures. The variability of these items may have a significant impact on our future GAAP financial results and, as a result, we are unable to prepare the forward-looking statement of income and statement of cash flows in accordance with GAAP that would be required to produce such a reconciliation.

Disclaimer

XPO Inc. published this content on April 30, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 30, 2026 at 10:57 UTC.