Overview

* RXO Q3 revenue of $1.42 bln missed analyst expectations

* Adjusted EPS for Q3 was $0.01, missing analyst estimates

* Brokerage volume grew 1% yr/yr, driven by 43% LTL volume growth

Outlook

* RXO expects Q4 adjusted EBITDA between $20 mln and $30 mln

* Company anticipates brokerage volume to decline by low-single-digit percentage in Q4

* RXO forecasts Q4 brokerage gross margin between 12% and 13%

Result Drivers

* LTL VOLUME GROWTH - Less-than-truckload volume increased by 43% year-over-year, driving brokerage volume growth

* MARKET TIGHTNESS - Full-truckload market tightened due to capacity exits, impacting buy rates and brokerage gross margin

* COST INITIATIVES - New cost initiatives expected to yield more than $30 mln of incremental savings

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 Miss $1.42 $1.45

Revenue bln bln (15

Analysts

)

Q3 Miss $0.01 $0.05

Adjusted (18

EPS Analysts

)

Q3 EPS -$0.08

Q3 $2 mln

Adjusted

Net

Income

Q3 $32 mln

Adjusted

EBITDA

Q3 2.30%

Adjusted

EBITDA

Margin

Analyst Coverage

* The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 15 "hold" and 3 "sell" or "strong sell"

* The average consensus recommendation for the ground freight & logistics peer group is "buy."

* Wall Street's median 12-month price target for RXO Inc ( RXO ) is $17.00, about 3.6% below its November 5 closing price of $17.62

* The stock recently traded at 55 times the next 12-month earnings vs. a P/E of 49 three months ago

Press Release:

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)