GXO — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue increased 5.7% year-over-year to $3.6 billion in Q3 2026, compared to $3.4 billion in Q3 2025; organic revenue grew 6.4%.
• Net income was $65 million in Q3 2026, up from $60 million in Q3 2025; diluted EPS was $0.56 versus $0.51.
• Adjusted EBITDA was $251 million in Q3 2026, flat compared to $251 million in Q3 2025; adjusted diluted EPS increased to $0.89 from $0.79.
• Cash flow from operations was $156 million in Q3 2026, down from $232 million in Q3 2025; free cash flow was $85 million, down from $187 million.
• Total debt outstanding was $2.8 billion as of September 30, 2026; net debt was $2.5 billion.
• Cash and cash equivalents (excluding restricted cash) were $340 million as of September 30, 2026.
• Operating income margin was 2.7% in Q3 2026, down from 3.5% in Q3 2025; adjusted EBITDA margin was 7.0%, down from 7.4%.
• Trailing twelve months adjusted EBITDA was $925 million as of September 30, 2026.
• Net leverage ratio was 2.7x as of September 30, 2026.

Guidance and Future Outlook:

• Reaffirmed full-year 2026 guidance: 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%.
• Year-to-date new business wins exceeded $1 billion, with a record sales pipeline of $3.1 billion, up more than 30% year-over-year.
• Management indicated entering 2027 from a position of strength with nearly matching 2025 wins with one quarter remaining.

Business Segments and Product Lines:

• New business wins totaled $375 million in Q3 2026, up 34% year-over-year, marking the second consecutive quarter of growth above 30%.
• Approximately 40% of year-to-date new business wins were in strategic growth verticals: aerospace & defense, technology, industrial, and life sciences.
• Revenue by geography in Q3 2026: United Kingdom ($1.751 billion), United States ($846 million), Netherlands ($263 million), France ($216 million), Spain ($184 million), Italy ($111 million), and Other ($219 million).
• Revenue by vertical in Q3 2026: Omnichannel retail ($1.689 billion), Technology and consumer electronics ($498 million), Industrial and manufacturing ($405 million), Food and beverage ($351 million), Consumer packaged goods ($333 million), and Other ($314 million).
• Productivity initiatives include the rollout of a unified labor management system and continued deployment of GXO IQ across the global footprint.

Market and Competitive Landscape:

• The company serves the world's leading blue-chip companies with technologically advanced supply chain and ecommerce solutions.
• GXO is positioned to capitalize on the rapid growth of ecommerce, automation, and outsourcing.
• The company operates more than 1,000 facilities totaling more than 200 million square feet with over 150,000 team members.

Risks and Challenges:

• Forward-looking statements are subject to risks including economic conditions, supply chain challenges, labor shortages, and competition.
• Risks include the ability to align capital investments to customer demands, successfully integrate acquired companies (including Wincanton), and manage labor disputes or subcontractors.
• Potential risks involve IT system failures, cyber-attacks, data security breaches, and the inability to implement technology initiatives or business systems successfully.
• Other risks include fluctuations in currency exchange rates, interest rates, customer confidence, and regulatory or political actions.

Management Commentary and Tone:

• CEO Patrick Kelleher stated the new strategy is delivering results, citing the fastest organic growth in over three years and increased new business wins.
• Management expressed confidence in improving execution in North America and advancing productivity initiatives to support future margin expansion.
• The tone was positive, highlighting the record sales pipeline and strong position entering 2027.

Other Key Points:

• Repurchased $84 million of shares in Q3 2026, bringing year-to-date repurchases to $100 million (2.1 million shares at an average price of $47.46 per share).
• $200 million remained available under the Company's existing share repurchase authorization as of September 30, 2026.
• The company will host its 2026 Investor Day on November 16, 2026, at the New York Stock Exchange to discuss long-term strategy and financial framework.
• A conference call is scheduled for November 4, 2026, at 8:30 a.m. Eastern Time.