In This Article:
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Total Revenue: $1.4 billion.
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Gross Margin: 16%.
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Adjusted EBITDA: $22 million.
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Adjusted EBITDA Margin: 1.5%.
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Adjusted Earnings Per Share: Negative $0.03.
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Brokerage Revenue: $1.1 billion, representing 72% of total revenue.
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Brokerage Gross Margin: 13.3%.
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Complementary Services Revenue: $450 million, increased by 8% year over year.
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Complementary Services Gross Margin: 21%.
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Last Mile Revenue: $278 million, up 20% year over year.
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Last Mile Stops Growth: 24% year over year.
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Adjusted Free Cash Flow: $6 million, 27% conversion from adjusted EBITDA.
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Cash on Balance Sheet: $16 million.
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Total Committed Liquidity: More than $575 million.
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Net Leverage: 1.9 times trailing 12 months bank-adjusted EBITDA.
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Expected Cash Synergies from Coyote Integration: More than $70 million.
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Second Quarter Adjusted EBITDA Guidance: $30 million to $40 million.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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RXO Inc (NYSE:RXO) completed a significant technology milestone by integrating Coyote's operations into a unified transportation management system, enhancing operational efficiency.
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The company raised its estimate for acquisition synergies to over $70 million, indicating successful integration and cost-saving measures.
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RXO Inc (NYSE:RXO) achieved a 26% year-over-year growth in less-than-truckload (LTL) volume, showcasing strong performance in this segment.
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Investments in technology, including AI and machine learning, have led to a 17% productivity increase over the last year, with further improvements anticipated.
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The last mile segment experienced a 24% year-over-year growth, driven by new customer wins and expansion into new markets.
Negative Points
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Brokerage volume for the combined business declined by 1% year over year, with full truckload volume decreasing by 8%, reflecting challenges in the freight market.
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The automotive sector posed a significant headwind, contributing to a $10 million gross profit decline due to reduced volume.
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RXO Inc (NYSE:RXO) reported an adjusted earnings per share of negative $0.03, indicating financial pressure in the current market environment.
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The macroeconomic environment remains uncertain, impacting near-term truckload demand and creating challenges for forecasting.
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RXO Inc (NYSE:RXO) faces competitive pressures in the brokerage industry, with new entrants and existing competitors impacting market dynamics.
Q & A Highlights
Q: Can you speak to your mid-cycle earnings power now with Coyote under your umbrella? A: Drew Wilkerson, CEO: The integration of Coyote has significantly improved RXO's long-term earnings power. We've doubled our volume in brokerage, which lowers our cost to serve and increases profitability. Our productivity improvements are just beginning, with a 17% year-over-year increase, providing substantial runway for further profitability enhancements.