RXO (RXO) Q4 2025 earnings summary

Executive summary

• Decisive actions and integration of Coyote enabled unified operations, improved data visibility, and enhanced customer solutions amid a prolonged soft freight market and significant capacity reductions, impacting brokerage gross margin and profitability.

• Brokerage late-stage sales pipeline grew over 50% year-over-year, with Managed Transportation securing over $200 million in new freight under management.

• Investments in AI and technology, including proprietary tools and automation, are driving productivity, margin improvement, and operational efficiency.

• A new $450 million asset-based lending facility was finalized, replacing the previous $600 million revolver, increasing financial flexibility and reducing costs.

Financial highlights

• Q4 2025 revenue was $1.5 billion, down from $1.7 billion year-over-year; gross margin: 14.8%; adjusted EBITDA: $17 million (1.2% margin); adjusted diluted loss per share: $0.07.

• Brokerage revenue: $1.1 billion, down 14% year-over-year; brokerage gross margin: 11.9%, down 130 bps year-over-year.

• Complementary services revenue: $431 million, flat year-over-year; gross margin: 20.2%.

• Full-year revenue: $5.7 billion; gross margin: 16.2%; adjusted EBITDA: $109 million; adjusted EBITDA margin: 1.9%.

• Q4 GAAP net loss: $46 million; adjusted net loss: $11 million.

Outlook and guidance

• Q1 2026 adjusted EBITDA expected between $5 million and $12 million, reflecting continued weak freight demand and elevated purchased transportation costs.

• Brokerage volume projected to decline 5%–10% year-over-year in Q1 2026; gross margin expected between 11% and 13%.

• CapEx for 2026 projected at $50–$55 million; depreciation $65–$75 million; amortization $40–$45 million.

• Restructuring, transaction, and integration expenses expected at $25–$30 million, with about one-third related to prior periods.

• LTL expected to grow mid-single digits year-over-year; last mile stops expected to decline mid-single digits.