Rxo Stock Earnings Reports

RXO reported Q1 2026 revenue of $1.4 billion, gross margin of 14.2% and adjusted EBITDA of $6 million (impacted by severe weather and a $3M hit to last‑mile). Management says the freight recovery is supply‑driven (capacity exiting the market due to regulatory enforcement), which is tightening truckload capacity and supporting rapidly rising rates. Key operational trends: brokerage full truckload volume improved every month in Q1, spot mix increased meaningfully (spot share rose ~500 bps sequentially and ~600 bps year‑over‑year, reaching ~35% of truckload in April) and gross profit per load rose sequentially. RXO upgraded its contract rate outlook: management now expects full‑year 2026 contract rates to increase by high single digits (vs. prior low‑to‑mid single digits). Managed Transportation won >$100M of freight under management in Q1 and has a growing pipeline; the new Middle Mile solution launched in February and already has a >$70M pipeline with ~$20M in wins. Technology/AI (Agentic AI, spot quote agent, matching algorithms, fraud protection) is being rolled out and early adopters are seeing higher volume and gross profit per load; Agentic tools automated >500,000 calls in Q1. Capital and cash: liquidity $386M at quarter end, net leverage ~3.7x LTM bank adjusted EBITDA, negative adjusted free cash flow of $15M in Q1 (timing and higher H1 CapEx), and a completed refinancing of 2027 senior notes (2031 maturity). Guidance: Q2 adjusted EBITDA of $27M–$37M (management sees significant sequential improvement and a path to the high end), expects brokerage volume roughly flat y/y in Q2 and truckload to resume outperformance vs. market by mid‑year. Management reiterated mid‑cycle EBITDA margin expectations (mid‑single digits) with higher peak potential and said AI and scale should drive structural margin improvement over time.