CEO Mario Harik said XPO recently completed a successful pilot of its AI-driven route optimization tools for pickup and delivery. (XPO Inc.)
February 9, 2026 11:39 AM, EST
Key Takeaways:
- EBITDA reached $312 million in Q4 2025, a 3% increase from $303 million in the 2024 period. EBITDA increased 11% when excluding real estate gains during the period.
- CEO Mario Harik: “We’ve deliberately invested in the network ahead of the up cycle to create more than 30% excess door capacity.”
- Improved cost efficiency underpinned by productivity gains and a lower reliance on purchase transportation, Harik says.
XPO Inc. emphasized controlling what it could during the fourth quarter as it worked to sharpen operations and prepare for an eventual freight market rebound.
The Greenwich, Conn.-based less-than-truckload carrier posted net income of $59 million, or 50 cents a diluted share, for the three months ending Dec. 31. That compared with $76 million, 63 cents, during the 2024 period. Total revenue increased 4.7% to $2.01 billion from $1.92 billion.
“We reported another quarter of strong execution to close out the year,” CEO Mario Harik said during a call with investors. “The key components of our strategy are fully within our control, and I’ll start with our most important lever, customer service. In 2025, we reduced damages and improved service quality to new company records, reflecting our focus on providing a superior customer experience.”
Harik highlighted that the adjusted earnings before interest, taxes, depreciation and amortization reached $312 million, a 3% increase from $303 million in the prior-year quarter. He also noted that EBITDA increased 11% when excluding real estate gains during the period, bringing adjusted EPS to an 18% gain.
“Our stronger service performance is translating directly to better commercial outcomes,” Harik said. “We’ve been able to earn higher prices and gain market share by providing consistent world-class service. When we make ongoing investments in the business, we’re strengthening the connection between service quality and value creation.
“For example, we’ve deliberately invested in the network ahead of the up cycle to create more than 30% excess door capacity.”
Harik added that these investments have provided flexibility to operate more efficiently in the current environment while positioning XPO to respond quickly during the recovery. He also is confident that the company workforce will support any near-term increases in demand, while maintaining service levels.
“Each component of our capacity has a role in making sure we realize significant upside, from our operating leverage, when demand recovers,” Harik said. “Next is pricing, which has a direct correlation to margin performance. Throughout 2025, we saw customers place more value on our service as reflected in the pricing gains we earn.”
Harik added that this was the third consecutive year the company improved revenue per shipment for every quarter. He also noted efforts to expand local customers and premium services are contributing to the above-market pricing growth. These revenue streams come with higher margins, he said, and long runways for both parts of the business.
“Another highlight of 2025 that contributed to margin was our improved cost efficiency,” Harik said. “This was underpinned by productivity gains and a lower reliance on purchase transportation. Productivity improved roughly 1½ points for the year, with the ramp-up in the second half from our latest technology rollouts. These are proprietary applications that use AI for planning, freight flow management and network operations.”
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Harik added that the company recently completed a successful pilot of its AI-driven route optimization tools for pickup and delivery, and is now expanding this internally developed technology to nearly half of its service centers in the first quarter. He expects these developments to improve overall miles and costs per hour.
“We entered 2026 from a position of strength following a year of significant progress in our performance,” Harik said. “These are all high-impact initiatives that are already driving results. Importantly, our progress will be amplified by the billions of dollars of cumulative free cash flow we expect to generate in the coming years, starting with a meaningful acceleration in 2026. This will be an increase in share repurchases, and debt reduction, to further compound our earnings growth.”
For the full year, XPO reported net income of $316 million, or $2.64 a share, on revenue of $8.16 billion, compared with net income of $387 million, $3.23, on revenue of $8.07 billion in 2024.
- North American LTL segment revenue for Q3 increased 0.8% to $1.17 billion from $1.16 billion during the 2024 period. Yields increased 5.2% on a year-over-year basis, while shipments per day decreased 1.6%, and tonnage per day decreased 4.5%. Operating income increased 2.8% to $184 million from $179 million the prior year.
- European Transportation segment revenue increased 10.6% to $846 million from $765 million. EBITDA was $32 million for the segment during the quarter compared with $27 million in 2024. The segment also reported an operating loss of $13 million compared with a loss of $11 million.
XPO ranks No. 5 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 39 on the TT Top 50 list of the largest global freight companies.
