XPO CEO Says Demand Recovery Will Amplify Returns From Here

On Thursday, XPO, Inc. (NYSE:XPO) reported first-quarter 2026 results that topped expectations, driven by revenue growth and improved profitability. Details Revenue rose 7.3% year over year to $2.096 billion, beating analyst estimates of $2.038 billion. Adjusted net income increased to $121 million from $87 million a year earlier, while adjusted earnings of $1.01 per share exceeded the consensus estimate of 88 cents. Operating income climbed to $174 million from $151 million in the prior-year period, and adjusted EBITDA rose to $319 million from $278 million. The company generated $183 million in operating cash flow and ended the quarter with $237 million in cash and cash equivalents. XPO also repurchased $30 million of shares during the quarter. Other Key Metrics Operationally, shipments per day increased 3% year over year, supported by strength in local accounts and premium freight, though a 2.8% decline in weight per shipment kept tonnage per day nearly flat, up 0.1%. Monthly trends improved sequentially, with shipments per day rising 1.2% in January, 3.0% in February and 3.8% in March. April tonnage is expected to be about 1% lower year over year but still ahead of typical seasonal patterns. XPO Segment Performance In the North American less-than-truckload segment, revenue rose 4.9% to $1.23 billion, with yield excluding fuel up 4.0% and shipments per day increasing 3.0%. Tonnage per day edged up 0.1%. The segment posted an adjusted operating ratio of 83.9%, a 200-basis-point improvement from a year earlier, which CEO Mario Harik said significantly outperformed seasonal trends. Adjusted EBITDA for the segment increased 16% to $290 million. The European transportation segment reported revenue of $868 million, up 11% year over year, while adjusted EBITDA rose slightly to $33 million from $32 million. Harik concluded, “We're continuing to deliver robust incremental margins and industry-leading operating ratio improvement, with the greatest upside still ahead. We have a clear path to compounding earnings growth and accelerating free cash flow generation, with returns amplified as freight demand recovers.” XPO Outlook And Commentary Looking ahead, the company expects revenue per shipment, excluding fuel, to improve through 2026, supported by disciplined pricing and stronger demand trends. Management anticipates continued pricing momentum, margin expansion and earnings growth, and said it is targeting an LTL operating ratio in the 70s, driven by pricing execution, AI-led efficiency gains, network optimization and structural cost reductions. XPO also expects strong multiyear free cash flow generation, which it plans to allocate toward share repurchases, debt reduction and long-term shareholder returns. XPO Price Action XPO Price Action: XPO shares were up 1.10% at $219.09 at the time of publication on Thursday, according to Benzinga Pro data. Photo via Shutterstock