XPO Reports Second Quarter 2024 Results

GREENWICH, Conn., Aug. 01, 2024 (GLOBE NEWSWIRE) — XPO (NYSE: XPO) today announced its financial results for the second quarter 2024. The company reported diluted earnings from continuing operations per share of $1.25, compared with $0.27 for the same period in 2023, and adjusted diluted earnings from continuing operations per share of $1.12, compared with $0.71 for the same period in 2023.

Second Quarter 2024 Summary Results
                                 
Three months ended June 30,    Revenue   Operating Income (Loss)
(in millions)     2024     2023   Change %   2024       2023     Change %
North American Less-Than-Truckload Segment   $ 1,272   $ 1,136   12.0 %   $ 203     $ 129     57.4 %
European Transportation Segment     808     781   3.5 %     10       12     -16.7 %
Corporate           0.0 %     (16 )     (34 )   -52.9 %
Total   $ 2,079   $ 1,917   8.5 %   $ 197     $ 107     84.1 %
                                 
Three months ended June 30,   Adjusted Operating Income(1)   Adjusted EBITDA(1)
(in millions)     2024     2023   Change %     2024       2023     Change %
North American Less-Than-Truckload Segment   $ 214   $ 142   50.7 %   $ 297     $ 208     42.8 %
European Transportation Segment     19     18   5.6 %     49       46     6.5 %
Corporate     NA     NA   NA     (3 )     (10 )   -70.0 %
Total   $ NA   $ NA   NA   $ 343     $ 244     40.6 %
                                 
Three months ended June 30,   Net Income(2)   Diluted EPS(3)
(in millions, except for per-share data)     2024     2023   Change %     2024       2023     Change %
Total   $ 150   $ 31   383.9 %   $ 1.25     $ 0.27     363.0 %
                                 
    Diluted Weighted-Average Common Shares Outstanding                    
Three months ended June 30,         Adjusted Diluted EPS(1)(3)
(in millions, except for per-share data)     2024     2023         2024       2023     Change %
Total     120     118       $ 1.12     $ 0.71     57.7 %
                                 
Amounts may not add due to rounding.                                
NA – Not applicable                                
(1) See the “Non-GAAP Financial Measures” section of the press release
(2) Net income from continuing operations
(3) Diluted earnings from continuing operations per share (“diluted EPS”)
                                 

Mario Harik, chief executive officer of XPO, said, “We reported a strong second quarter of earnings growth, underpinned by a year-over-year increase in revenue of 9%. Companywide, we grew adjusted EBITDA by 41% and adjusted diluted EPS by 58%.

“In North American LTL, we continued to deliver service at record levels, with the best damage claims ratio in our history at 0.2%. This helped drive above-market yield growth, ex-fuel, of 9%, and a 3.4% increase in tonnage per day, with 4.5% more shipments per day. We also operated more cost efficiently, reducing purchased transportation and increasing labor productivity. As a result, we reported a 51% increase in adjusted operating income and improved our adjusted operating ratio by 440 basis points to 83.2%. In addition, we’ve now opened 14 of the 28 service centers we acquired in December, with another 10 expected this year.”

Harik continued, “Our strong performance demonstrates the steady progress we’re making toward becoming the LTL service leader in North America. We’ll continue to build our service offering, invest in capacity ahead of demand and operate more efficiently. This strategy is creating a long runway for future margin expansion.” 

Second Quarter Highlights

For the second quarter 2024, the company generated revenue of $2.08 billion, compared with $1.92 billion for the same period in 2023. The year-over-year increase in revenue was due primarily to higher yield and tonnage per day in the North American LTL segment.

Operating income was $197 million for the second quarter, compared with $107 million for the same period in 2023. Net income from continuing operations was $150 million for the second quarter, compared with $31 million for the same period in 2023. The year-over-year increase in net income from continuing operations includes a one-time tax benefit of $41 million related to the reorganization of the company’s legal entities in the European business. Diluted earnings from continuing operations per share was $1.25 for the second quarter, compared with $0.27 for the same period in 2023.

Adjusted net income from continuing operations, a non-GAAP financial measure, was $135 million for the second quarter, compared with $83 million for the same period in 2023, and excludes the $41 million tax benefit. Adjusted diluted EPS, a non-GAAP financial measure, was $1.12 for the second quarter, compared with $0.71 for the same period in 2023.

Adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), a non-GAAP financial measure, was $343 million for the second quarter, compared with $244 million for the same period in 2023.

The company generated $210 million of cash flow from operating activities in the second quarter, and ended the quarter with $250 million of cash and cash equivalents on hand, after $184 million of net capital expenditures.

Results by Business Segment

  • North American Less-Than-Truckload (LTL): The segment generated revenue of $1.27 billion for the second quarter 2024, compared with $1.14 billion for the same period in 2023. On a year-over-year basis, shipments per day increased 4.5%, tonnage per day increased 3.4%, and yield, excluding fuel, increased 9.0%. Including fuel, yield increased 7.8%.

    Operating income was $203 million for the second quarter 2024, compared with $129 million for the same period in 2023. Adjusted operating income, a non-GAAP financial measure, was $214 million for the second quarter, compared with $142 million for the same period in 2023. Adjusted operating ratio, a non-GAAP financial measure, was 83.2%, reflecting a year-over-year improvement of 440 basis points.

    Adjusted EBITDA for the second quarter 2024 was $297 million, compared with $208 million for the same period in 2023. The year-over-year increase in adjusted EBITDA was due primarily to higher yield, excluding fuel, and an increase in tonnage per day.

  • European Transportation: The segment generated revenue of $808 million for the second quarter 2024, compared with $781 million for the same period in 2023. Operating income was $10 million for the second quarter, compared with $12 million for the same period in 2023.

    Adjusted EBITDA was $49 million for the second quarter 2024, compared with $46 million for the same period in 2023.

  • Corporate: The segment generated an operating loss of $16 million for the second quarter 2024, compared with a loss of $34 million for the same period in 2023. The year-over-year improvement in operating loss was due primarily to a $6 million reduction in transaction and integration costs and a $4 million reduction in restructuring costs.

    Adjusted EBITDA, a non-GAAP financial measure, was a loss of $3 million for the second quarter 2024, compared with a loss of $10 million for the same period in 2023, reflecting a year-over-year improvement from the company’s continued rationalization of corporate overhead costs. 

Conference Call

The company will hold a conference call on Thursday, August 1, 2024, at 8:30 a.m. Eastern Time. Participants can call toll-free (from US/Canada) 1-877-269-7756; international callers dial +1-201-689-7817. A live webcast of the conference will be available on the investor relations area of the company’s website, xpo.com/investors. The conference will be archived until August 31, 2024. To access the replay by phone, call toll-free (from US/Canada) 1-877-660-6853; international callers dial +1-201-612-7415. Use participant passcode 13747657.

About XPO

XPO, Inc. (NYSE: XPO) is a leader in asset-based less-than-truckload (LTL) freight transportation in North America. The company’s customer-focused organization efficiently moves 18 billion pounds of freight per year, enabled by its proprietary technology. XPO serves approximately 53,000 customers with 615 locations and 38,000 employees in North America and Europe, with headquarters in Greenwich, Conn., USA. Visit xpo.com for more information, and connect with XPO on LinkedIn, Facebook, X, Instagram and YouTube.

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 press release to the most directly comparable measure under GAAP, which are set forth in the financial tables attached to this press release.

XPO’s non-GAAP financial measures in this press release include: adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) on a consolidated basis and for corporate; adjusted EBITDA margin on a consolidated basis; adjusted net income from continuing operations; adjusted diluted earnings from continuing operations per share (“adjusted diluted EPS”); adjusted operating income for our North American Less-Than-Truckload and European Transportation segments; and adjusted operating ratio for our North American Less-Than-Truckload segment.

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-GAAP financial measures should only be used as supplemental measures of our operating performance.

Adjusted EBITDA, adjusted EBITDA margin, adjusted net income from continuing operations, adjusted diluted 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 and adjusted EBITDA margin improve 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 from continuing operations and adjusted diluted 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 expenses as set out in the attached tables.

Forward-looking Statements

This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. In some cases, forward-looking statements can be identified by the use of forward-looking terms such as “anticipate,” “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target,” “trajectory” or the negative of these terms or other comparable terms. These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances.

These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions that may cause actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause or contribute to a material difference include the risks discussed in our filings with the SEC, and the following: the effects of business, economic, political, legal, and regulatory impacts or conflicts upon our operations; supply chain disruptions and shortages, strains on production or extraction of raw materials, cost inflation and labor and equipment shortages; our ability to align our investments in capital assets, including equipment, service centers, and warehouses to our customers’ demands; our ability to implement our cost and revenue initiatives; the effectiveness of our action plan, and other management actions, to improve our North American LTL business; changes in expected growth in trade between the US and Mexico affecting demand; changes in the future needs of cross-border shippers; increased or decreased demand for cross-border LTL shipping; our ability to benefit from a sale, spin-off or other divestiture of one or more business units or to successfully integrate and realize anticipated synergies, cost savings and profit opportunities from acquired companies; goodwill impairment; issues related to compliance with data protection laws, competition laws, and intellectual property laws; fluctuations in currency exchange rates, fuel prices and fuel surcharges; the expected benefits of the spin-offs of GXO Logistics, Inc. and RXO, Inc.; our ability to develop and implement suitable information technology systems; the impact of potential cyber-attacks and information technology or data security breaches or failures; our indebtedness; our ability to raise debt and equity capital; fluctuations in interest rates; seasonal fluctuations; our ability to maintain positive relationships with our network of third-party transportation providers; our ability to attract and retain key employees including qualified drivers; labor matters; litigation; and competition and pricing pressures.  

All forward-looking statements set forth in this release are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to or effects on us or our business or operations. Forward-looking statements set forth in this release speak only as of the date hereof, and we do not undertake any obligation to update forward-looking statements except to the extent required by law.

Investor Contact
Brian Scasserra
+1 617-607-6429
[email protected]

Media Contact
Cole Horton
+1 203-609-6004
[email protected]

XPO, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(In millions, except per share data)
                               
  Three Months Ended   Six Months Ended
  June 30,   June 30,
    2024       2023     Change %     2024       2023     Change %
                               
Revenue $ 2,079     $ 1,917     8.5 %   $ 4,097     $ 3,824     7.1 %
Salaries, wages and employee benefits   854       783     9.1 %     1,688       1,545     9.3 %
Purchased transportation   436       444     -1.8 %     874       901     -3.0 %
Fuel, operating expenses and supplies   402       390     3.1 %     814       817     -0.4 %
Operating taxes and licenses   21       15     40.0 %     40       30     33.3 %
Insurance and claims   33       46     -28.3 %     71       90     -21.1 %
Gains on sales of property and equipment   (4 )     (2 )   100.0 %     (5 )     (5 )   0.0 %
Depreciation and amortization expense   122       107     14.0 %     239       208     14.9 %
Transaction and integration costs   12       17     -29.4 %     26       39     -33.3 %
Restructuring costs   6       10     -40.0 %     14       34     -58.8 %
Operating income   197       107     84.1 %     335       165     103.0 %
Other income   (6 )     (3 )   100.0 %     (16 )     (8 )   100.0 %
Debt extinguishment loss         23     -100.0 %           23     -100.0 %
Interest expense   56       43     30.2 %     114       85     34.1 %
Income from continuing operations before income tax provision   147       44     234.1 %     237       65     264.6 %
Income tax provision (benefit)   (3 )     13     NM     20       17     17.6 %
Income from continuing operations   150       31     383.9 %     217       48     352.1 %
Income (loss) from discontinued operations, net of taxes         2     -100.0 %         (1 )   -100.0 %
Net income $ 150     $ 33     354.5 %   $ 217     $ 47     361.7 %
                               
Net income (loss)                              
Continuing operations $ 150     $ 31         $ 217     $ 48      
Discontinued operations         2                 (1 )    
Net income $ 150     $ 33         $ 217     $ 47      
                               
Basic earnings (loss) per share (1)                              
Continuing operations $ 1.29     $ 0.27         $ 1.87     $ 0.42      
Discontinued operations         0.01                 (0.01 )    
Basic earnings per share $ 1.29     $ 0.28         $ 1.87     $ 0.41      
Diluted earnings (loss) per share (1)                              
Continuing operations $ 1.25     $ 0.27         $ 1.81     $ 0.41      
Discontinued operations         0.01                 (0.01 )    
Diluted earnings per share $ 1.25     $ 0.28         $ 1.81     $ 0.40      
                               
Weighted-average common shares outstanding                              
Basic weighted-average common shares outstanding   116       116           116       116      
Diluted weighted-average common shares outstanding   120       118           120       117      
                               
Amounts may not add due to rounding.
NM – Not meaningful.
(1) The sum of quarterly earnings (loss) per share may not equal year-to-date amounts due to differences in the weighted-average number of shares outstanding during the respective periods.
                               
     
                               
XPO, Inc.  
Condensed Consolidated Balance Sheets  
(Unaudited)  
(In millions, except per share data)  
             
  June 30,   December 31,  
  2024     2023    
ASSETS            
Current assets            
Cash and cash equivalents $ 250     $ 412    
Accounts receivable, net of allowances of $45 and $45, respectively   1,088       973    
Other current assets   210       208    
Total current assets   1,548       1,593    
Long-term assets            
Property and equipment, net of $1,954 and $1,853 in accumulated depreciation, respectively   3,305       3,075    
Operating lease assets   742       708    
Goodwill   1,481       1,498    
Identifiable intangible assets, net of $476 and $452 in accumulated amortization, respectively 392       422    
Other long-term assets   262       196    
Total long-term assets   6,182       5,899    
Total assets $ 7,729     $ 7,492    
             
             
LIABILITIES AND STOCKHOLDERS’ EQUITY            
Current liabilities            
Accounts payable $ 477     $ 532    
Accrued expenses   772       775    
Short-term borrowings and current maturities of long-term debt   64       69    
Short-term operating lease liabilities   129       121    
Other current liabilities   99       93    
Total current liabilities   1,542       1,590    
Long-term liabilities            
Long-term debt   3,330       3,335    
Deferred tax liability   364       337    
Employee benefit obligations   88       91    
Long-term operating lease liabilities   613       588    
Other long-term liabilities   294       285    
Total long-term liabilities   4,688       4,636    
             
Stockholders’ equity            
Common stock, $0.001 par value; 300 shares authorized; 116 shares issued and outstanding            
as of June 30, 2024 and December 31, 2023, respectively            
Additional paid-in capital   1,322       1,298    
Retained earnings   402       185    
Accumulated other comprehensive loss   (225 )     (217 )  
Total equity   1,499       1,266    
Total liabilities and equity $ 7,729     $ 7,492    
             
Amounts may not add due to rounding.  
             
XPO, Inc.  
Condensed Consolidated Statements of Cash Flows  
(Unaudited)  
(In millions)  
               
    Six Months Ended  
    June 30,  
      2024       2023    
Cash flows from operating activities of continuing operations            
Net income $ 217     $ 47    
Loss from discontinued operations, net of taxes         (1 )  
Income from continuing operations   217       48    
Adjustments to reconcile income from continuing operations to net cash from operating activities            
  Depreciation and amortization   239       208    
  Stock compensation expense   42       41    
  Accretion of debt   5       7    
  Deferred tax expense (benefit)   25       (6 )  
  Gains on sales of property and equipment   (5 )     (5 )  
  Other   6       39    
Changes in assets and liabilities            
  Accounts receivable   (135 )     (64 )  
  Other assets   (67 )     (31 )  
  Accounts payable   14       (57 )  
  Accrued expenses and other liabilities   13       27    
Net cash provided by operating activities from continuing operations   355       207    
Cash flows from investing activities of continuing operations            
  Payment for purchases of property and equipment   (496 )     (355 )  
  Proceeds from sale of property and equipment   13       13    
Net cash used in investing activities from continuing operations   (483 )     (342 )  
Cash flows from financing activities of continuing operations            
  Proceeds from issuance of debt         1,977    
  Repurchase of debt         (2,003 )  
  Repayment of debt and finance leases   (39 )     (35 )  
  Payment for debt issuance costs   (4 )     (15 )  
  Change in bank overdrafts   27       51    
  Payment for tax withholdings for restricted shares   (17 )     (12 )  
  Other   (1 )     1    
Net cash used in financing activities from continuing operations   (35 )     (36 )  
Cash flows from discontinued operations            
  Operating activities of discontinued operations         (8 )  
  Investing activities of discontinued operations         1    
Net cash used in discontinued operations         (7 )  
Effect of exchange rates on cash, cash equivalents and restricted cash         5    
Net decrease in cash, cash equivalents and restricted cash   (162 )     (173 )  
Cash, cash equivalents and restricted cash, beginning of period   419       470    
Cash, cash equivalents and restricted cash, end of period $ 256     $ 297    
               
Amounts may not add due to rounding.  
               
North American Less-Than-Truckload Segment  
Summary Financial Table  
(Unaudited)  
(In millions)  
                                 
  Three Months Ended June 30,   Six Months Ended June 30,  
  2024     2023     Change %   2024     2023     Change %  
                                 
Revenue (excluding fuel surcharge revenue) $ 1,064     $ 940     13.2 %   $ 2,075     $ 1,843     12.6 %  
Fuel surcharge revenue   208       196     6.1 %     418       413     1.2 %  
Revenue   1,272       1,136     12.0 %     2,493       2,256     10.5 %  
Salaries, wages and employee benefits   639       573     11.5 %     1,252       1,128     11.0 %  
Purchased transportation   68       87     -21.8 %     146       186     -21.5 %  
Fuel, operating expenses and supplies (1)   236       226     4.4 %     479       474     1.1 %  
Operating taxes and licenses   16       12     33.3 %     32       24     33.3 %  
Insurance and claims   20       33     -39.4 %     41       61     -32.8 %  
Losses on sales of property and equipment   1       1     0.0 %     3       2     50.0 %  
Depreciation and amortization   86       71     21.1 %     168       139     20.9 %  
Transaction and integration costs             0.0 %     1           NM  
Restructuring costs   1       4     -75.0 %     2       10     -80.0 %  
Operating income   203       129     57.4 %     368       232     58.6 %  
Operating ratio (2)   84.1 %     88.7 %         85.2 %     89.7 %      
Amortization expense   9       9           18       17        
Transaction and integration costs                   1              
Restructuring costs   1       4           2       10        
Adjusted operating income (3) $ 214     $ 142     50.7 %   $ 389     $ 259     50.2 %  
Adjusted operating ratio (3) (4)   83.2 %     87.6 %         84.4 %     88.5 %      
Depreciation expense   77       62           150       122        
Pension income   6       4           13       8        
Other                         1        
Adjusted EBITDA (5) $ 297     $ 208     42.8 %   $ 551     $ 390     41.3 %  
Adjusted EBITDA margin (6)   23.3 %     18.3 %         22.1 %     17.3 %      
                                 
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) See the “Non-GAAP Financial Measures” section of the press release.  
(4) 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.  
(5) Adjusted EBITDA is used by our chief operating decision maker to evaluate segment profit (loss) in accordance with ASC 280.  
(6) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.  
                                 
North American Less-Than-Truckload  
Summary Data Table  
(Unaudited)  
                                 
  Three Months Ended June 30,   Six Months Ended June 30,  
  2024   2023   Change %   2024   2023   Change %  
                                 
Pounds per day (thousands)   72,658     70,290   3.4 %     71,687     69,587   3.0 %  
                                 
Shipments per day   53,519     51,220   4.5 %     52,460     50,159   4.6 %  
                                 
Average weight per shipment (in pounds)   1,358     1,372   -1.1 %     1,367     1,387   -1.5 %  
                                 
Revenue per shipment (including fuel surcharges) $ 370.98   $ 348.86   6.3 %   $ 372.39   $ 352.40   5.7 %  
                                 
Revenue per shipment (excluding fuel surcharges) $ 310.24   $ 288.75   7.4 %   $ 309.91   $ 287.83   7.7 %  
                                 
Gross revenue per hundredweight (including fuel surcharges) (1) $ 28.04   $ 26.01   7.8 %   $ 27.92   $ 26.00   7.4 %  
                                 
Gross revenue per hundredweight (excluding fuel surcharges) (1) $ 23.56   $ 21.63   9.0 %   $ 23.35   $ 21.34   9.4 %  
                                 
Average length of haul (in miles)   847.8     836.7         848.1     834.1      
                                 
Total average load factor (2)   22,884     22,822   0.3 %     22,877     22,956   -0.3 %  
                                 
Average age of tractor fleet (years)   4.0     5.1                      
                                 
Number of working days   64.0     63.5         127.5     127.5      
                                 
                                 
(1) Gross revenue per hundredweight excludes the adjustment required for financial statement purposes in accordance with the company’s revenue recognition policy.  
(2) Total average load factor equals freight pound miles divided by total linehaul miles.  
Note: Table excludes the company’s trailer manufacturing operations. Percentages presented are calculated using the underlying unrounded amounts.  
                                 
European Transportation Segment  
Summary Financial Table  
(Unaudited)  
(In millions)  
                                 
  Three Months Ended June 30,   Six Months Ended June 30,  
  2024     2023     Change %   2024     2023     Change %  
                                 
Revenue $ 808     $ 781     3.5 %   $ 1,605     $ 1,568     2.4 %  
Salaries, wages and employee benefits   212       203     4.4 %     428       406     5.4 %  
Purchased transportation   368       357     3.1 %     728       715     1.8 %  
Fuel, operating expenses and supplies (1)   165       162     1.9 %     335       337     -0.6 %  
Operating taxes and licenses   4       3     33.3 %     8       6     33.3 %  
Insurance and claims   13       13     0.0 %     27       28     -3.6 %  
Gains on sales of property and equipment   (5 )     (3 )   66.7 %     (9 )     (7 )   28.6 %  
Depreciation and amortization   35       33     6.1 %     70       65     7.7 %  
Transaction and integration costs   1           NM     1       1     0.0 %  
Restructuring costs   3       1     200.0 %     11       8     37.5 %  
Operating income $ 10     $ 12     -16.7 %   $ 6     $ 9     -33.3 %  
Amortization expense   5       5           10       10        
Transaction and integration costs   1                 1       1        
Restructuring costs   3       1           11       8        
Adjusted operating income (2) $ 19     $ 18     5.6 %   $ 28     $ 28     0.0 %  
Depreciation expense   30       28           59       55        
Adjusted EBITDA (3) $ 49     $ 46     6.5 %   $ 87     $ 83     4.8 %  
Adjusted EBITDA margin (4)   6.1 %     6.0 %         5.4 %     5.3 %      
                                 
Amounts may not add due to rounding.  
NM – Not meaningful.  
(1) Fuel, operating expenses and supplies includes fuel-related taxes.  
(2) See the “Non-GAAP Financial Measures” section of the press release.  
(3) Adjusted EBITDA is used by our chief operating decision maker to evaluate segment profit (loss) in accordance with ASC 280.  
(4) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.  
                                 
Corporate  
Summary Financial Table  
(Unaudited)  
(In millions)  
                                 
  Three Months Ended June 30,   Six Months Ended June 30,  
  2024     2023     Change %   2024     2023     Change %  
                                 
Revenue $     $     0.0 %   $     $     0.0 %  
                                 
Salaries, wages and employee benefits   3       7     -57.1 %     8       11     -27.3 %  
Fuel, operating expenses and supplies         2     -100.0 %           6     -100.0 %  
Operating taxes and licenses             0.0 %               0.0 %  
Insurance and claims             0.0 %     3       1     200.0 %  
Depreciation and amortization   1       3     -66.7 %     2       4     -50.0 %  
Transaction and integration costs   11       17     -35.3 %     24       38     -36.8 %  
Restructuring costs   1       5     -80.0 %     1       16     -93.8 %  
Operating loss $ (16 )   $ (34 )   -52.9 %   $ (39 )   $ (76 )   -48.7 %  
Other income (expense) (1)         (1 )         3       (1 )      
Depreciation and amortization   1       3           2       4        
Transaction and integration costs   11       17           24       38        
Restructuring costs   1       5           1       16        
Adjusted EBITDA (2) $ (3 )   $ (10 )   -70.0 %   $ (8 )   $ (19 )   -57.9 %  
                                 
Amounts may not add due to rounding.  
(1) Other income (expense) consists of foreign currency gain (loss) and other income (expense).  
(2) See the “Non-GAAP Financial Measures” section of the press release.  
                                 
XPO, Inc.  
Reconciliation of Non-GAAP Measures  
(Unaudited)  
(In millions)  
                                 
  Three Months Ended June 30,   Six Months Ended June 30,  
  2024     2023     Change %   2024     2023     Change %  
                                 
Reconciliation of Net Income from Continuing Operations to Adjusted EBITDA                                
Net income from continuing operations $ 150     $ 31     383.9 %   $ 217     $ 48     352.1 %  
Debt extinguishment loss         23                 23        
Interest expense   56       43           114       85        
Income tax provision (benefit)   (3 )     13           20       17        
Depreciation and amortization expense   122       107           239       208        
Transaction and integration costs   12       17           26       39        
Restructuring costs   6       10           14       34        
Adjusted EBITDA (1) $ 343     $ 244     40.6 %   $ 631     $ 454     39.0 %  
Revenue $ 2,079     $ 1,917     8.5 %   $ 4,097     $ 3,824     7.1 %  
Adjusted EBITDA margin (1) (2)   16.5 %     12.7 %         15.4 %     11.9 %      
                                 
Amounts may not add due to rounding.  
(1) See the “Non-GAAP Financial Measures” section of the press release.  
(2) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.  
                                 
XPO, Inc.    
Reconciliation of Non-GAAP Measures (cont.)  
(Unaudited)  
(In millions, except per share data)  
                             
    Three Months Ended   Six Months Ended    
    June 30,   June 30,    
    2024     2023     2024     2023      
                             
Reconciliation of Net Income from Continuing Operations and Diluted Earnings Per Share from Continuing Operations to Adjusted Net Income from Continuing Operations and Adjusted Earnings Per Share from Continuing Operations                          
Net income from continuing operations $ 150     $ 31     $ 217     $ 48      
  Debt extinguishment loss         23             23      
  Amortization of acquisition-related intangible assets   14       14       28       27      
  Transaction and integration costs   12       17       26       39      
  Restructuring costs   6       10       14       34      
  Income tax associated with the adjustments above (1)   (6 )     (12 )     (12 )     (23 )    
  European legal entity reorganization (2)   (41 )           (41 )          
                             
Adjusted net income from continuing operations (3) $ 135     $ 83     $ 232     $ 148      
                             
Adjusted diluted earnings from continuing operations per share (3) $ 1.12     $ 0.71     $ 1.93     $ 1.27      
                             
Weighted-average common shares outstanding                          
  Diluted weighted-average common shares outstanding   120       118       120       117      
                             
Amounts may not add due to rounding.    
                             
(1) This line item reflects the aggregate tax benefit of all non-tax related adjustments reflected in the table above. The detail by line item is as follows:    
  Debt extinguishment loss $     $ 5     $     $ 5      
  Amortization of acquisition-related intangible assets   3       3       7       6      
  Transaction and integration costs   1       2       3       5      
  Restructuring costs   1       2       3       7      
    $ 6     $ 12     $ 12     $ 23      
                             
Amounts may not add due to rounding.    
The income tax rate applied to reconciling items is based on the GAAP annual effective tax rate, excluding discrete items, non-deductible compensation, and contribution- and margin-based taxes.    
                             
(2) Reflects a tax benefit recognized in the second quarter of 2024 related to a legal entity reorganization within our European Transportation business.    
(3) See the “Non-GAAP Financial Measures” section of the press release.    
                             


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