GXO posts $3.59B Q3 revenue as new business wins jump 34%

GXO Logistics booked third-quarter revenue of $3.59 billion, up 5.7% year over year, and pulled in $375 million of new contract wins — a 34% jump that marks the second straight quarter above 30% growth.

The Greenwich, Connecticut-based contract logistics provider, listed on the NYSE as GXO, reported the results Tuesday for the quarter ended Sept. 30. Organic revenue grew 6.4%, the company's fastest pace in more than three years, and its sales pipeline hit a record $3.1 billion, up more than 30% from a year earlier.

"The new strategy we put in motion over the past year is delivering results," CEO Patrick Kelleher said in the earnings release. He said GXO is winning more business across its core markets and strategic growth sectors while getting better at converting opportunities into revenue.

Where the growth came from

Year-to-date new business wins have exceeded $1 billion. That nearly matches GXO's total contract wins for all of 2025 — with a full quarter still to go.

Around 40% of those wins came from strategic growth industries: aerospace and defense, technology, industrial operations and life sciences.

The segment numbers show the shift. Technology and consumer electronics revenue climbed 18.6% to $498 million from $420 million. Industrial and manufacturing rose 4.9% to $405 million. Omnichannel retail, still GXO's largest customer segment, grew 2.7% to $1.69 billion. Food and beverage was the laggard, down 5.4% to $351 million.

Geographically, the United Kingdom stayed the biggest market at $1.75 billion in quarterly revenue, up 7.6%. U.S. revenue rose 5.6% to $846 million from $801 million.

What happened to profitability?

Here's the tension in the numbers. Revenue is accelerating, but profit isn't.

Net income rose to $65 million from $60 million, and diluted EPS climbed to 56 cents from 51 cents. Adjusted diluted EPS rose 12.7% to 89 cents from 79 cents. But operating income fell 18.6% to $96 million from $118 million, and the operating margin narrowed to 2.7% from 3.5%.

Adjusted EBITDA held flat at $251 million, with margin slipping to 7% from 7.4%. Adjusted EBITA edged down 0.6% to $163 million.

The culprit sits in the cost line. Direct operating expenses grew to $3.06 billion from $2.86 billion — faster than revenue — squeezing operating profitability.

Cash generation weakened too. Operating cash flow fell 32.8% to $156 million from $232 million. Free cash flow dropped 54.5% to $85 million from $187 million, even though capital expenditures were cut nearly in half to $74 million from $144 million.

What does this change for shippers and GXO itself? For shippers, a record pipeline signals that outsourcing of warehousing, distribution and supply chain operations keeps gaining traction — and that competition for GXO's capacity may tighten. For GXO, the commercial question is whether new contract wins carry enough margin to reverse the profitability slide once they ramp.

Guidance reaffirmed

Despite the softer margins and cash flow, GXO reaffirmed its full-year 2026 outlook:

• Organic revenue growth of 4% to 5%.
• Adjusted EBITDA of $945 million to $965 million.
• Adjusted diluted EPS of $2.95 to $3.15.
• Free cash flow conversion of 30% to 40%.

Through the first nine months of 2026, revenue reached $10.33 billion, up 6.8% from $9.67 billion a year earlier. Nine-month adjusted EBITDA totaled $670 million, compared with $626 million.

On the balance sheet, GXO repurchased $84 million of common stock in the quarter, bringing year-to-date buybacks to $100 million. As of Sept. 30, the company held $340 million in cash and equivalents against roughly $2.8 billion of outstanding debt.

GXO will hold its third-quarter earnings call at 8:30 a.m. Wednesday. The record pipeline and accelerating wins point to strengthening demand for outsourced logistics — but the trajectory investors will watch is whether GXO can convert that growth into the 7%+ margins and stronger cash flow its guidance implies.