GXO Logistics Posts $3.6B Q3 Revenue in First Look

First look: GXO Logistics Q3 revenue reaches $3.6 billion

GXO Logistics reported third-quarter revenue of $3.59 billion, up 5.7% from $3.4 billion a year earlier, as the contract logistics provider added new business and expanded its sales pipeline to a record level.

The Greenwich, Connecticut-based company said organic revenue increased 6.4% during the quarter ended Sept. 30, its fastest pace in more than three years. GXO manages warehousing, distribution and supply chain operations for customers across industries including retail, technology, manufacturing and food and beverage.

New business wins totaled $375 million during the quarter, a 34% increase from the same period last year. It was the second consecutive quarter in which new contract wins increased by more than 30%, according to the company.

GXO’s sales pipeline reached a record $3.1 billion, more than 30% above its level a year earlier. The pipeline represents potential future contract opportunities, although those opportunities still must be converted into signed agreements and launched operations.

“The new strategy we put in motion over the past year is delivering results,” CEO Patrick Kelleher said in a news release. He said GXO is winning more business in its core markets and strategic growth sectors, converting opportunities more quickly and improving visibility into future revenue.

Kelleher told analysts that contract logistics typically operates on a sales cycle of about six months. That means contracts won during the quarter may take time to begin contributing significantly to revenue as facilities are prepared, systems are integrated and operations are started.

Profit growth was mixed

GXO’s net income rose to $65 million, compared with $60 million in the third quarter of 2025. Diluted earnings per share increased to 56 cents from 51 cents, while adjusted diluted earnings per share rose to 89 cents from 79 cents.

However, operating income declined to $96 million from $118 million. Operating margin narrowed to 2.7% from 3.5% a year earlier.

Adjusted EBITDA was unchanged at $251 million, while adjusted EBITDA margin fell to 7% from 7.4%. Direct operating expenses increased to $3.06 billion from $2.86 billion, growing faster than revenue and putting pressure on operating profitability.

Cash generation also weakened. Operating cash flow fell to $156 million from $232 million, and free cash flow declined to $85 million from $187 million. Capital expenditures were $74 million, down from $144 million in the year-ago quarter.

The results illustrate the challenge for contract logistics operators: New customer awards can increase revenue, but the cost of opening and staffing facilities, handling higher volumes and supporting operations can weigh on margins as the business expands.

Growth concentrated in selected industries

GXO said year-to-date new business wins had exceeded $1 billion, nearly matching the total won during all of 2025 with one quarter still remaining. About 40% of those wins came from strategic growth industries, including aerospace and defense, technology, industrial operations and life sciences.

Technology and consumer electronics produced $498 million in quarterly revenue, up 18.6% from $420 million a year earlier. Industrial and manufacturing revenue rose 4.9% to $405 million.

Omnichannel retail, GXO’s largest customer segment, generated $1.69 billion in revenue, up 2.7%. Food and beverage revenue declined 5.4% to $351 million.

The United Kingdom remained GXO’s largest geographic market, with quarterly revenue of $1.75 billion, an increase of 7.6%. Revenue in the United States rose 5.6% to $846 million from $801 million in the third quarter of 2025.

For professional drivers and carriers, GXO’s growth is primarily tied to the movement of freight into and out of distribution centers rather than traditional truckload operations. More contract logistics activity can mean additional inbound and outbound freight flows, but the effect on individual trucking operations will vary by facility, customer, geography and transportation arrangements.

Company maintains 2026 outlook

Despite the lower operating margin and weaker cash flow, GXO reaffirmed its full-year 2026 guidance. The company continues to project organic revenue growth of 4% to 5%, adjusted EBITDA of $945 million to $965 million and adjusted diluted earnings per share of $2.95 to $3.15.

GXO also continues to expect free cash flow conversion of 30% to 40%.

Through the first nine months of 2026, revenue totaled $10.33 billion, up 6.8% from $9.67 billion during the same period last year. Nine-month adjusted EBITDA was $670 million, compared with $626 million in the year-ago period.

The company repurchased $84 million of its common stock during the quarter, bringing year-to-date repurchases to $100 million. As of Sept. 30, GXO reported $340 million in cash and cash equivalents and approximately $2.8 billion in outstanding debt.

Overall, GXO’s third-quarter results show solid demand for outsourced warehousing and distribution services, supported by rising contract wins and a larger pipeline. At the same time, the decline in operating margin, operating cash flow and free cash flow shows that converting that demand into more profitable growth remains a central challenge.