From Yahoo Finance: 2025-04-30 13:36:00

XPO, a less-than-truckload carrier, has seen improved margins despite industry struggles. Adjusted earnings per share for Q1 were 73 cents, exceeding estimates. Shares rose 6.8% post-earnings. XPO aims for 150 bps margin improvement in 2025 even with trade war concerns. It added 2,500 local accounts in Q1, targeting 30% revenue growth from this segment.

Revenue for XPO’s LTL unit decreased by 4% y/y to $1.17 billion, with tonnage down 7.5%. Service enhancements have led to on-time performance improvements and higher yields. XPO aims to raise premium charges to 15% for trade show and time-definite freight. Revenue per shipment has increased for the past two years.

XPO expects revenue and yield to improve throughout the year, with contract renewals showing increases. The company sees opportunities for superior pricing with service improvements. Tonnage declines have been offset by pricing metrics, but heavier shipments are needed for margin growth. XPO’s LTL segment reported an 85.9% adjusted operating ratio.

XPO has added equipment to reduce reliance on third-party operators and enhance efficiency. It has cost levers to adjust expenses if the economy weakens. European transportation revenue declined by 1.9% y/y. Cash flow from operations reached $142 million, boosting liquidity to $811 million. Net debt leverage decreased from the previous year.



Read more at Yahoo Finance: XPO sees runway for higher margins even if downcycle lingers