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GXO expects to double revenue, triple EBITDA by 2027

Revenue to grow up to 12% per year, putting top line at $17 billion in 5 years

GXO Logistics sees strong growth through 2027. (Photo: GXO Logistics)

GXO Logistics Inc. said Thursday it expects to nearly double its revenue and triple its adjusted earnings by 2027 as it foresees increasing demand for its services.

In its first investor day since becoming a public company in August 2021, Greenwich, Connecticut-based GXO (NYSE: GXO) said it expects revenue to grow by 8% to 12% annually from 2021 through ’27. The company said that would leave its revenue at about $17 billion by then.

GXO expects adjusted earnings before interest, taxes, depreciation and amortization to grow 17% annually through 2027. On a compounded basis, that would nearly triple the EBITDA reported in 2021.

GXO can make long-term projections because its customer contracts are of a long-term nature and very stable.

For 2022, GXO expects $9 billion in revenue, up from $7.9 billion in ’21. Adjusted EBITDA will come in at between $720 million and $730 million, up from $611 million in ’21. Net income of between $189 million and $199 million will be significantly higher than the $153 million posted in ’21.

In 2023, GXO projects 6% to 8% organic revenue growth and between $700 million and $730 million in EBITDA guidance.


Investors seemed to warm to the projections. As of midday Thursday, shares rose 6.5% to $52.11.

GXO’s projections for adjusted 2022 EBITDA was ahead of the $717 million consensus forecast, according to Jason H. Seidl, analyst at Cowen & Co. With projected revenue in line with Cowen’s estimates, the bottom-line results suggest “better than expected operating cost management, a positive for GXO’s automation-focused efficiency strategy,” Seidl wrote in a Thursday note.

Seidl, who has an outperform rating on GXO’s shares with a $59 per share price target, said the company’s 2023 revenue and EBITDA guidance “implies notable resilience in the face of an anticipated economic slowdown.” Seidl said that GXO is well-positioned to manage the needs of customers looking to remove costs from their systems in the face of a weak macroeconomic environment.

GXO, which was spun off from XPO Inc. (NYSE: XPO) in 2021, is the world’s largest pure-play contract logistics provider.

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Mark Solomon

Formerly the Executive Editor at DC Velocity, Mark Solomon joined FreightWaves as Managing Editor of Freight Markets. Solomon began his journalistic career in 1982 at Traffic World magazine, ran his own public relations firm (Media Based Solutions) from 1994 to 2008, and has been at DC Velocity since then. Over the course of his career, Solomon has covered nearly the whole gamut of the transportation and logistics industry, including trucking, railroads, maritime, 3PLs, and regulatory issues. Solomon witnessed and narrated the rise of Amazon and XPO Logistics and the shift of the U.S. Postal Service from a mail-focused service to parcel, as well as the exponential, e-commerce-driven growth of warehouse square footage and omnichannel fulfillment.