Trucking Company XPO Posts Q3 Miss And Long-Term Outlook Ahead Of Spinoff
XPO Logistics, Inc (NYSE: XPO) shared preliminary results for the third quarter of FY22 and long-term targets.
XPO expects revenue of $3.04 billion, below the consensus of $3.1 billion. It expects an operating income of $181 million - $185 million.
XPO sees adjusted EBITDA of $348 million - $352 million.
Also Read: XPO Logistics’ Proposed Spin-Off RXO Raises $355M Via Debt Offering
The partial earnings release comes ahead of its first investor day under incoming CEO Mario Harik, on October 18, and the November 1 spinoff of its high-tech truck brokerage business into a new publicly traded company called RXO, CNBC reported.
During an interview in March, XPO Chairman and former CEO Brad Jacobs said he hoped that turning the company into a pure-play trucker would eliminate the so-called “conglomerate discount” for XPO shares.
For the truck brokerage segment that will become RXO, the company expects revenue to decrease by 2% year over year and volume to increase by 9%. Truck brokerage connects truckers with customers in the on-demand “spot market.”
XPO also issued goals for both XPO and RXO to reach by FY27.
It saw the trucking operation delivering revenue growth at a compound annual rate of 6% - 8% and annual adjusted EBIDTA growth of 11% - 13%.
XPO expects the brokerage company to achieve adjusted EBITDA of $475 million - $525 million by 2027, with annual spending of about 1% of revenue 202-2027.
“The long-term guidance we issued shows that we expect continued strong performance for both XPO and RXO,” Harik said.
Price Action: XPO shares closed higher by 3.59% at $48.48 on Monday.
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