According to www.freightwaves.com, GXO Logistics booked $375 million in new business wins in the third quarter, a 34% year-over-year increase, as demand from data center, aerospace and defense customers pushed its sales pipeline to a record $3.1 billion.
The Greenwich, Connecticut-based contract logistics provider reported quarterly revenue of $3.59 billion, up 5.7% from $3.4 billion a year earlier. Organic revenue grew 6.4%, and adjusted earnings per share rose 13% to 89 cents.
The record pipeline marks an increase of more than 30%. Management said GXO’s contract logistics business typically runs on a six-month sales cycle, meaning deals signed over the past year are only now starting to convert into revenue.
North America and data centers drive expansion
North America has become GXO’s largest growth opportunity, with the regional sales pipeline up more than 80% year over year to roughly $1.3 billion. Chief Strategy Officer Kristine Kubacki said the pipeline across the United Kingdom and Europe reached approximately $1.7 billion.
Technology and consumer electronics were the fastest-growing customer category in the quarter, with revenue up 19%, largely on data center activity. Management said requests for proposals from technology companies building out data center infrastructure show no sign of slowing.
GXO is also chasing more business in aerospace and defense, industrial logistics and life sciences. Those strategic growth industries accounted for about 40% of new business wins through the first nine months of 2026.
“Those are very complex mandates, very complicated supply chains. It tends to be stickier. It tends to be higher value-added services.” — Kristine Kubacki, Chief Strategy Officer
During the quarter, GXO reported new or expanded relationships with Applied Materials, Boeing, NetApp, Unilever and L’Oréal. The company expects to enter 2027 with more than $850 million in incremental revenue from previously signed contracts, compared with $774 million entering 2026.
Rapid onboarding pressures margins
While revenue and contract wins accelerated, executives said the pace of new customer onboarding added expenses in the quarter. Adjusted EBITDA was flat at $251 million, producing a 7% adjusted EBITDA margin.
GXO brought in outside consulting and implementation resources to support the rapid launch of several large customer operations. Management characterized the extra costs as specific to the quarter rather than an ongoing structural problem, and said the company is expanding internal implementation capacity for future growth.
Net income rose 8.3% to $65 million from $60 million, while adjusted diluted EPS climbed 12.7% to $0.89 from $0.79.
2026 guidance reaffirmed despite cash flow drop
GXO reaffirmed its full-year financial guidance. It still expects organic revenue growth of 4% to 5%, adjusted EBITDA of $945 million to $965 million, and adjusted diluted earnings per share of $2.95 to $3.15.
The company expects fourth-quarter organic growth slightly above 5%, assuming flat customer volumes; stronger holiday shipping demand could push growth toward the 6.4% recorded in the third quarter.
Third-quarter operating cash flow fell to $156 million from $232 million a year earlier, a decline of 32.8%, while free cash flow dropped 54.5% to $85 million from $187 million. The decline was attributed mainly to the timing of enterprise resource planning investments and higher net capital expenditures. GXO expects the fourth quarter to be its strongest cash-generating period of the year.
Source: FreightWaves
Compiled from international media by the SCI.AI editorial team.
