North America turns into GXO’s fastest-growing market in Q2, topping $782M 

Executives at GXO Logistics mentioned its transformation technique is starting to repay as the corporate reported its strongest business quarter in three years and expressed confidence that development will speed up into 2027.

Throughout the second-quarter earnings name on Wednesday earlier than the market opened, CEO Patrick Kelleher mentioned the corporate has moved past management modifications and strategic planning into execution, with business momentum, synthetic intelligence deployments and operational enhancements starting to translate into monetary outcomes.

“This quarter marks 5 years since GXO turned an unbiased public firm,” Kelleher mentioned. “The muse established over the previous 5 years mixed with new management and a brand new strategic agenda are actually translating into outcomes. We’re seeing actual momentum construct behind our technique and we’re nonetheless within the early innings.”

Greenwich, Connecticut-based GXO Logistics (NYSE: GXO) is without doubt one of the largest pure-play contract logistics suppliers on the planet. It has greater than 970 services totaling roughly 200 million sq. ft, with a world workforce of greater than 130,000 individuals.  

The corporate launched its second quarter earnings after the market closed on Tuesday.

GXO reported income of $3.4 billion within the second-quarter, up 4.3% yr over yr, however lacking Wall Road forecasts of $3.45 billion.

Adjusted EBITDA rose to $219 million, and adjusted diluted earnings per share elevated to 59 cents. The adjusted EPS outcomes topped Wall Road expectations of 58 cents per share.

The corporate generated $76 million in working money movement and $12 million in free money movement throughout the quarter.

Kelleher mentioned roughly 40% of recent enterprise wins got here from 4 strategic verticals the corporate has prioritized: aerospace and protection, expertise and knowledge facilities, industrials and life sciences. 

“We’re profitable extra and we’re profitable higher,” Kelleher mentioned, highlighting expanded relationships with clients together with Nike, PepsiCo, Marks & Spencer, Boeing and Raytheon, together with a significant new hyperscaler knowledge middle buyer.

Executives mentioned they see North America as GXO’s largest long-term development alternative.

Kelleher mentioned business modifications carried out over the previous yr have considerably improved the corporate’s efficiency within the area, with first-half North American wins growing 85% from the identical interval a yr in the past.

Chief Technique Officer Kristine Kubacki added that North America’s gross sales pipeline expanded 34% yr over yr, serving to push GXO’s total business pipeline again to $2.7 billion solely weeks after the quarter ended.

Executives mentioned the corporate now has greater than $1 billion of incremental income already secured for 2026 and roughly $353 million already dedicated for 2027.

Synthetic intelligence was one of many main themes all through the earnings name.

Kelleher mentioned GXO IQ, the corporate’s proprietary AI platform, has shifted from launch mode into scaled deployment, with the expertise anticipated to succeed in roughly 50 services by the top of 2026.

The platform is getting used to enhance demand forecasting, stock replenishment, labor planning and warehouse choosing. GXO officers additionally anticipate to deploy round 20,000 robots throughout its world community this yr.

Whereas analysts requested about humanoid robots, Kelleher mentioned GXO stays within the testing part.

“We have now performed 45 pilots on humanoids up to now,” he mentioned. “We have now not achieved ROI on humanoids but. I believe we’re a few years away from that.”

Chief Monetary Officer Mark Suchinski advised analysts that increasing profitability is now a main focus.

Suchinski mentioned investments in standardized working dashboards, labor administration programs, procurement and automation are anticipated to start producing measurable margin enhancements later this yr.

Kelleher mentioned long-term profitability is a main focus for the corporate.

“We lag our aggressive friends when it comes to EBITDA and EBIT efficiency,” he mentioned. “We’re very targeted on closing that hole after which eclipsing the efficiency of our friends.”

Executives additionally famous that the not too long ago acquired Wincanton enterprise stays on observe to ship $60 million in annual run-rate value synergies by year-end, with roughly 90% of deliberate integration actions already accomplished.

The corporate maintained its 2026 steering for 4% to five% natural income development, adjusted EBITDA of $945 million to $965 million, adjusted diluted EPS of $2.95 to $3.15, and free money movement conversion of 30% to 40%.

GXO Q2 2026 monetary highlights

Why it issues: As shippers search productiveness good points and labor efficiencies, GXO executives mentioned automation is turning into an more and more necessary aggressive benefit for third-party logistics suppliers.

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