Key takeaways:
- GXO secured $410 million in annualised new business during the second quarter, 34% more than a year earlier.
- Around 40% of the wins came from aerospace and defence, technology, industrial and life-sciences customers.
- Revenue rose 4.3% to $3.44 billion, with organic growth in all three operating regions.
- Adjusted EBITDA increased 3% to $219 million, but the margin remained unchanged at 6.4%.
- The company has already secured approximately $1 billion of additional revenue for 2026 and $353 million for 2027.
- GXO maintained its full-year organic revenue growth forecast of 4–5%.
The contract logistics provider said its second-quarter order intake was led by new and expanded work for several global companies, including Nike, Marks & Spencer, PepsiCo, Boeing and Raytheon.
GXO also secured a major contract with an unnamed hyperscale technology company, which it described as its largest win of the quarter. Other agreements included an e-commerce contract with Ahold in continental Europe and GXO’s first semiconductor-logistics contract in Malaysia.
The $410 million of new business wins was 34% higher than in the corresponding period of 2025. First-half wins reached $638 million, an increase of approximately 19% year on year.
GXO calculates contract wins based on their expected annualised revenue, rather than the total value of the agreements over their entire duration.
GXO targets more complex supply chains
Approximately 40% of GXO’s new business during the quarter came from four sectors that the company has identified as strategic growth markets: aerospace and defence, technology and data centres, industrials, and life sciences. The company estimates that these sectors represent a combined addressable market of more than $230 billion.
GXO said the work differs from conventional warehouse operations because it generally involves more technically demanding, regulated and service-intensive programmes. The company believes these contracts are also harder for customers to switch between providers and can yield higher margins.
In aerospace and defence, GXO secured new or expanded business with Raytheon, Boeing and International Airlines Group. The company said the capabilities added through its acquisition of UK logistics operator Wincanton had strengthened its position in this market, particularly in defence logistics.
Technology-related demand is also being driven by investment in data centres. Alongside its new hyperscale customer, GXO expanded its work with an existing global cloud and technology company and an international semiconductor-equipment manufacturer.
GXO expects demand from data-centre and aerospace and defence customers to support another substantial year-on-year increase in contract wins during the third quarter.
Consumer logistics remains the core business
Despite the increased emphasis on specialist business-to-business supply chains, GXO has not abandoned its traditional markets. Around 70% of its existing business remains linked to consumer-facing sectors such as retail, e-commerce, omnichannel fulfilment and consumer packaged goods. These areas also accounted for approximately 60% of its new contracts during the first half of 2026.
The second-largest agreement signed during the quarter was the continental European e-commerce contract with Ahold. GXO said it was seeking growth through three principal routes: expanding its work for existing customers, taking contracts from competing logistics providers and benefiting from companies outsourcing logistics operations for the first time.
North America has emerged as a particularly important growth market. GXO’s first-half contract wins in the region were 85% higher than a year earlier, while its North American sales pipeline increased 34%.
Revenue grows, but margin remains flat
GXO generated revenue of $3.44 billion during the second quarter, an increase of 4.3% from $3.30 billion a year earlier. Organic revenue growth, excluding acquisitions and currency effects, was 3.4%, with growth reported across all three of its operating regions. Adjusted EBITDA increased from $212 million to $219 million, while adjusted diluted earnings per share rose from $0.57 to $0.59.
However, the adjusted EBITDA margin remained unchanged at 6.4%. Net income also edged down from $28 million to $27 million.
Investors nevertheless responded cautiously to the results. GXO’s shares fell around 9% on 5 August after quarterly revenue of $3.44 billion came in slightly below analysts’ expectations of approximately $3.46–3.47 billion.
The reaction suggests that investors are waiting for GXO’s strong contract intake to translate into faster revenue growth and higher margins. Organic growth of 3.4% remained below the company’s full-year target of 4–5%, while the adjusted EBITDA margin was unchanged at 6.4%.
There also remains a substantial difference between GXO’s statutory and adjusted earnings. GAAP diluted earnings per share stood at $0.22, compared with adjusted EPS of $0.59, reflecting exclusions including integration, restructuring and other exceptional costs.
GXO said the timing of new contract launches and the closure of outgoing contracts affected quarterly revenue. The company expects margins to begin improving during the second half as recently won business starts contributing and operational efficiency measures take effect.
Cash generation improved more clearly. Operating cash flow rose from $3 million to $76 million, while free cash flow moved from a $43 million outflow in the second quarter of 2025 to a positive $12 million this year.
At the end of June, GXO held $769 million in cash, while net leverage had fallen from 3.0 times adjusted EBITDA a year earlier to 2.6 times. The company subsequently used available cash to repay $400 million of bonds that matured in July.
More than $1bn of additional 2026 revenue secured
GXO said contracts already signed would generate approximately $1 billion in additional revenue during 2026, 29% more than the equivalent amount secured at this point last year. It has also secured $353 million of incremental revenue for 2027.
Its commercial pipeline stood at $2.3 billion at the end of the second quarter but had returned to a record level of approximately $2.7 billion by 29 July, despite the large number of contracts converted during the quarter.
The company maintained its forecast for organic revenue growth of 4–5% in 2026. It narrowed its adjusted EBITDA guidance to between $945 million and $965 million and its adjusted diluted earnings-per-share forecast to $2.95–$3.15, leaving the midpoint of both ranges unchanged.
The results nevertheless leave GXO with work to do during the remainder of the year. Second-quarter organic growth of 3.4% was below its full-year target range, while the flat margin shows that stronger contract intake has not yet translated into faster profitability growth.
The company is therefore relying on recently signed contracts coming on stream during the second half, alongside cost savings, automation and operational changes, to deliver the acceleration anticipated in its guidance.
