Tag: GlobeNewswire

DALLAS, Oct. 29, 2026 (GLOBE NEWSWIRE) — CSW Industrials, Inc. (NYSE: CSW or the “Company”) today reported results for the fiscal 2027 second quarter period ended September 30, 2026.

Fiscal 2027 Second Quarter Highlights (comparisons to fiscal 2026 second quarter)

• Total revenue increased 31% to a record of $361 million, driven by both acquisitions and organic growth
• Contractor Solutions Segment delivered strong organic revenue growth of 13%
• Earnings per diluted share (“EPS”) of $2.90 increased 20% compared to $2.41, driven primarily by increased revenue
• Adjusted EPS, which excludes the amortization of acquisition-related intangible assets and nonrecurring expenses, was a record second quarter $3.66 and increased 24% compared to $2.96
• Net income attributable to CSW of $47 million increased 16% compared to $41 million
• Adjusted EBITDA increased 33% to a record second quarter $97 million, capitalizing on increased revenue
• Cash flows from operations were a record $95 million, increasing 54%
• Net debt of $734 million at the end of the quarter, reflecting a debt paydown of $91 million during the quarter and resulting in a net leverage ratio (Net Debt to EBITDA), in accordance with our credit facility, of 2.10x, within our stated target range of 1-3x, and improved from our first fiscal quarter-end

Fiscal 2027 First Half Highlights (comparisons to fiscal 2026 first half)

• Total revenue increased 32% to a record half of $712 million, driven by acquisitions during the last twelve months and organic growth
• Contractor Solutions Segment delivered strong organic revenue growth of 9%
• EPS improved 23% to a record half of $5.94, compared to $4.84
• Adjusted EPS of $7.50, increased 29% when compared to $5.81
• Net income attributable to CSW increased 19% to $97 million, compared to $82 million
• Adjusted EBITDA increased 40% to a record half of $198 million, leveraging revenue growth
• Cash flows from operations were a record $171 million, increasing 40%
• Repaid $105 million of debt since fiscal year-end due to strong operating cash flows
• Returned total cash of $39 million to shareholders through share repurchases of $29 million and dividends of $10 million

Comments from the Chairman, President, and Chief Executive Officer

Joseph B. Armes, CSW Industrials’ Chairman, President, and Chief Executive Officer, commented, “Today we reported all-time-record revenue, adjusted EBITDA, adjusted EPS, and operating cash flow for the first half of fiscal 2027 underscoring the wisdom of our strategy, the excellence of our execution, and the resilience of our business. Guided by our enduring capital allocation philosophy, we prioritized debt reduction during the quarter, further deleveraging and strengthening our balance sheet. Recent acquisitions have strategically expanded our product portfolio and enhanced our growth trajectory.”

Armes continued, “Our optimistic outlook for the remainder of fiscal 2027 is unchanged. We expect to deliver sustained organic revenue growth in excess of the markets we serve. We may have some short-term margin headwinds due to recent cost increases, but we remain confident in our long-term ability to achieve adjusted EBITDA growth in excess of our revenue growth as well as strong cash flow conversion. We remain focused on maximizing long-term shareholder value through prudent financial management, disciplined capital allocation, and rigorous cost management, which together we expect will accelerate our growth in profitability.”

Fiscal 2027 Second Quarter Consolidated Results

Fiscal second quarter revenue was $361.4 million, an $84.5 million or 30.5% increase over the prior year period. Total revenue growth included $56.3 million or 20.3% inorganic growth contributed by acquisitions completed over the last twelve months, which are reported within the Contractor Solutions and Specialized Reliability Solutions segments, as well as an increase in organic revenue of $28.2 million or 10.2%, comprised of 12.9% growth in Contractor Solutions and 12.7% growth in Specialized Reliability Solutions, offset by lower revenue in Engineered Building Solutions.

Gross margin contracted 100 bps to 42.0%, or 90 bps to 42.1% as adjusted, compared to 43.0% in the prior year period. The adjusted gross margin decrease was primarily a result of increased ocean and domestic freight expense as well as rising raw materials costs. Gross profit in the fiscal second quarter was $151.9 million, or $152.3 million adjusted, representing 27.5%, or 27.8% adjusted, growth over $119.2 million in the prior year period. Adjustments made to gross profit and gross margin in the quarter included acquisition-related integration expenses.

Operating expenses were $76.4 million, or $75.6 million adjusted. Adjustments in the quarter were primarily comprised of $0.7 million in nonrecurring expenses related to integration of completed acquisitions. Operating expenses in the prior period were $62.4 million, or $60.6 million adjusted. Operating expenses were higher in the current period due to acquired companies’ additional expenses, including amortization of intangible assets. Operating expenses as a percentage of revenue were 21.1%, or 20.9% adjusted, lower than the prior year period of 22.5%, or 21.9% adjusted, leveraging increased revenue, as well as restructuring savings and synergy realization.

Operating income in the current period was $75.5 million, or $76.8 million adjusted, compared to $56.8 million, or $58.5 million adjusted in the prior year period. Operating income as a percentage of revenue was 20.9%, or 21.2% adjusted, compared to 20.5%, or 21.1% adjusted in the prior year period. The adjusted operating income margin was comparable to the prior year period.

Interest expense, net of interest income, was $12.5 million, as compared to $1.3 million in the prior year period. Interest expense in the quarter resulted from the Term Loan A and increased borrowings under our revolving line of credit, due to our acquisitions and share repurchases in the last year.

In the current period, reported net income attributable to CSW improved 16.4% to $47.3 million, compared to $40.7 million in the prior year period. EPS was $2.90 per diluted share, an increase of 20.3% as compared to $2.41 per diluted share in the prior year period, driven by both contributions from recent acquisitions and organic growth, partially offset by higher interest expense and intangible amortization, as well as lower share count. Excluding the amortization of acquisition-related intangible assets and nonrecurring expenses, adjusted EPS increased 23.6% to a record $3.66 per diluted share, compared to $2.96 per diluted share in the prior year period.

Fiscal 2027 second quarter adjusted EBITDA increased 32.6% to a record $96.7 million, up from $72.9 million in the prior year period. Adjusted EBITDA margin expanded 50 bps to 26.8%, compared to 26.3% in the prior year period, due to the previously mentioned improvement in operating expense leverage, offset somewhat by gross margin contraction.

The Company’s effective tax rate for the fiscal second quarter was 24.1%, or 24.5% adjusted, as compared to 26.4% in the prior year period. The adjusted effective tax rate was favorably impacted by the discount on an energy tax credit purchase.

The quarterly cash flows from operations were $95.4 million, as compared to $61.8 million in the prior year period, an increase of 54.4%. Free cash flows, defined as cash flows from operations minus capital expenditures, was $91.9 million, compared to $58.7 million in the prior year period, an increase of $33.2 million, or 56.5%. The increases were primarily due to strong working capital management and higher earnings.

Including cash on hand, our net debt according to our credit facility covenant calculation was $734 million, resulting in a Net Debt-to-EBITDA leverage ratio of 2.10x. The Company ended the quarter with $766.5 million outstanding on the revolving line of credit and the Term Loan A. The revolving line of credit and Term Loan A will have an interest rate of one-month SOFR plus 175 basis points following the fiscal second quarter covenant calculation submission, per terms of the credit facility. As a reminder, in the third quarter of fiscal 2026, the Company entered into a three-year syndicated interest rate hedge to lock in the SOFR rate at 3.416% for the first $300.0 million borrowing under the Term Loan A.

Following quarter-end, the Company announced a regular quarterly cash dividend in the amount of $0.30 per share, to be paid on November 13, 2026, to shareholders of record on October 30, 2026. This represents the Company’s thirty-first consecutive quarterly dividend.

Fiscal 2027 Second Quarter Segment Results

Contractor Solutions segment revenue was $285.8 million, a $77.3 million or 37.1% increase over the prior year period, comprised of inorganic growth of 24.2% or $50.5 million from the MARS Parts acquisition and a 12.9% or $26.8 million increase in organic revenue from both pricing actions and volume growth. Segment operating income was $69.7 million, or $70.5 million adjusted to exclude $0.8 million of nonrecurring expenses related to acquisition integration, compared to $53.4 million, or $54.9 million adjusted, in the prior year period. The increase in operating profit resulted from the inclusion of the MARS Parts acquisition, organic volume growth, and pricing actions, partially offset by raw materials cost inflation and increased ocean and domestic freight expense. Segment operating income margin for the fiscal second quarter was 24.4%, or 24.7% adjusted, as compared to 25.6%, or 26.3% adjusted, primarily due to increased costs of materials and freight expenses. Segment adjusted EBITDA in the fiscal second quarter increased 31.5% to $88.9 million, or 31.1% of revenue, compared to $67.6 million, or 32.4% of revenue, in the prior year period. The decrease in adjusted EBITDA margin is primarily due to the higher ocean and domestic freight expenses and materials costs already mentioned, more than offsetting pricing actions.

Specialized Reliability Solutions segment revenue was a record $49.5 million, a $10.7 million or 27.6% increase over the prior year period. Revenue growth was comprised of organic growth of $4.9 million, or 12.7%, and inorganic growth of $5.8 million, or 14.9%. Revenue increased in all end markets served. Segment operating income was $8.9 million, or $9.3 million adjusted to exclude nonrecurring expenses related to acquisition integration, an increase of 82.3% compared to $5.1 million in the prior year period. Segment operating income margin for the fiscal second quarter was 18.0%, or 18.8% adjusted, as compared to the prior year period of 13.1% due to higher margins on recent acquisitions, pricing actions, and a favorable product mix, offset somewhat by increased freight. Segment adjusted EBITDA in the fiscal second quarter was a record $10.6 million, or 21.5% of revenue, compared to $6.4 million, or 16.5% of revenue in the prior year period, again achieving our long-term margin target of greater than 20% for this segment.

Engineered Building Solutions segment revenue was $28.4 million, an 11.1% decrease compared to $31.9 million in the prior year period, due to the Greco Plan discussed below, partially offset by growth in the continuing businesses. Segment operating income was $3.4 million, or 12.0% of revenue, or $3.5 million and 12.4% of revenue adjusted, as compared to the prior year period of $4.8 million, or 15.1% of revenue. The decrease is primarily the result of our previously announced plan to sell the Greco U.S. business and strategically exit the Greco Canada business (“Greco Plan”). During the fiscal quarter, in connection with the Greco Plan, we recorded additional exit-related expenses of $0.1 million. Adjusted EBITDA and adjusted EBITDA margin in the fiscal second quarter were $3.6 million and 12.8%, respectively, compared to $5.2 million and 16.4%, respectively, in the prior year period.

Excluding the Greco businesses, Engineered Building Solutions segment revenue was $22.7 million, a 2.4% increase compared to $22.1 million in the prior year period. Segment adjusted EBITDA and adjusted EBITDA margin in the fiscal second quarter were $4.4 million and 19.3%, respectively, compared to $4.9 million and 22.1%, respectively, in the prior year period.

All percentages are calculated based upon the attached financial statements. Share counts used in determining the diluted EPS are based on a weighted average of outstanding shares throughout the reporting period.

Fiscal 2027 First Half Consolidated Results

Fiscal first half revenue was a record $712.1 million, representing 31.7% growth from $540.6 million in the prior year period, with growth coming from the Contractor Solutions and Specialized Reliability Solutions reporting segments. Of the $171.5 million total growth, $129.3 million was inorganic from acquisitions in the last twelve months, complemented with a $42.2 million or 7.8% increase in organic revenue.

Gross profit in the fiscal first half was $309.3 million, or $310.3 million adjusted, representing $75.7 million or 32.3% growth from $234.6 million in the prior year period, with the incremental profit resulting predominantly from revenue growth, partially offset by increases in material costs and freight expense. Gross profit as a percentage of sales was 43.4%, or 43.6% adjusted, which was comparable to 43.4% in the prior year period. Adjustments made to gross profit and gross margin in the first half include acquisition-related integration expenses and costs related to the Greco Plan.

Operating expenses as a percentage of revenue were 21.6%, or 21.3% adjusted, which was an improvement compared to the prior year period of 22.7% or 22.4% adjusted. Adjustments in the first half were comprised of $1.8 million in nonrecurring expenses related to integration of completed acquisitions, and $0.1 million related to the Greco Plan. Operating expenses in the current year period were $153.9 million or $152.0 million adjusted as compared to $123.0 million or $121.2 million in the prior year period. The additional expenses were related to recent acquisitions including amortization of intangible assets.

In the current period, operating income was $155.4 million or $158.3 million adjusted to exclude the aforementioned adjustments, as compared to $111.7 million, or $113.4 million adjusted, in the prior year period. The incremental operating income resulted primarily from increased revenue. Operating income margin in the current period increased to 21.8% or 22.2% adjusted, compared to the prior year period of 20.7% or 21.0% adjusted due to the improved leverage of operating expenses.

Interest expense, net was $25.2 million, compared to $2.3 million in the prior year period. The increase of $22.9 million was a result of a higher debt balance throughout the first half of the year resulting from the Term Loan A and increased borrowings against the revolver, as well as elevated interest rate.

Other expense, net was $0.2 million, compared to other income, net of $0.5 million in the prior year period. The change of $0.7 million was primarily related to losses/gains arising from transactions in currencies other than functional currencies, as well as a non-cash $0.3 million tax indemnification asset related to the Falcon acquisition that was released and recognized in other expense.

Net income attributable to CSW increased to $97.1 million, compared to the prior year period of $81.6 million primarily as a result of higher revenue. EPS was $5.94, compared to $4.84 in the prior period. Excluding the amortization of acquisition-related intangible assets and the aforementioned nonrecurring expenses, adjusted EPS was $7.50 vs. $5.81, an increase over the prior year period of 29.1%, driven by contributions from recent acquisitions and organic growth, partially offset by higher interest expense and lower share count.

Fiscal 2027 first half adjusted EBITDA increased 40.0% to $198.3 million from $141.7 million in the prior year period. Adjusted EBITDA as a percentage of revenue increased 160 bps to 27.8%, compared to 26.2%, in the prior year period, leveraging our increased revenue.

Net cash provided by operating activities for the fiscal 2027 first half was $171.0 million, an increase of 39.7% compared to $122.5 million in the prior year’s first half due to increased profit and strong working capital management. Free cash flows, defined as cash flows from operations minus capital expenditures, was $161.5 million compared to $116.5 million in the prior year period, an increase of $45.1 million, or 38.7%. The Company paid down $105.0 million of debt in the first half, utilizing our strong operating cash flow.

The Company’s effective tax rate for the fiscal first half was 24.9%, or 25.1% adjusted, which remained in line with 25.4% in the prior year.

Fiscal 2027 First Half Segment Results

Contractor Solutions segment revenue was $561.8 million, a $156.6 million or 38.6% increase from the prior year period. Revenue growth was comprised of inorganic growth from acquisitions during the last twelve months ($118.2 million, or 29.2%, of growth), and organic growth of $38.4 million or 9.5% due to increased pricing and unit volumes. Organic unit volumes were up in the first half of the current fiscal year due to end market improvement and leveraging our extended product portfolio. Segment operating income in the current year period was $144.7 million, or $146.4 million adjusted to exclude $1.7 million in acquisition-related expenses, compared to $106.1 million, or $107.7 million adjusted in the prior year period. The incremental profit resulted primarily from the inclusion of recent acquisitions, pricing actions, and organic volume growth, partially offset by increased raw materials costs and higher ocean and domestic freight. Segment operating income margin was 25.8%, or 26.1% adjusted, compared to 26.2%, or 26.6% adjusted, in the prior year period, driven primarily by increased raw material costs and higher freight costs. Segment adjusted EBITDA in the current period was $183.3 million, or 32.6% of revenue, compared to $132.6 million, or 32.7% of revenue in the prior year period.

Specialized Reliability Solutions segment revenue grew to $97.7 million, a $22.1 million or 29.2% increase from the prior year period of $75.6 million, with growth in all end markets served. In the current year period, segment operating income was $17.0 million, or $17.8 million adjusted, compared to the prior year period of $10.3 million. Segment operating income margin was 17.4% or 18.2% adjusted, compared to 13.7% in the prior year period. The improvement in segment operating income resulted from the addition of higher margin acquisitions, pricing actions, savings from restructuring actions, and synergy realization. Segment adjusted EBITDA in the current period was $20.7 million, or 21.2% of revenue, compared to $12.9 million, or 17.1% of revenue in the prior year period.

Engineered Building Solutions segment revenue was $57.3 million, a $6.5 million or 10.2% decrease over the prior year period of $63.8 million, driven primarily by the Greco Plan. Segment operating income was $8.0 million, or $8.4 million adjusted. This represents a 5.1% decrease from prior year period operating income of $8.8 million, or 13.8% of revenue. Segment adjusted EBITDA in the current period was $8.7 million, or 15.1% of revenue, compared to $9.7 million, or 15.1% of revenue in the prior year period.

Excluding the Greco businesses, Engineered Building Solutions segment revenue was $46.1 million, a 4.7% increase compared to $44.0 million in the prior year period. Segment adjusted EBITDA and adjusted EBITDA margin in the fiscal first half were $10.5 million and 22.8%, respectively, compared to $8.7 million and 19.8%, respectively, in the prior year period.

All percentages are calculated based upon the attached financial statements. Share count used in determining the diluted EPS is based on a weighted average of outstanding shares throughout the measurement period.

Conference Call Information

The Company will host a conference call today at 10:00 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. A live webcast of the call can be accessed at https://ir.csw.com. To access the call, participants may dial 1-877-407-0784, international callers may use 1-201-689-8560, and request to join the CSW Industrials earnings call.

A telephonic replay will be available shortly after the conclusion of the call and until Thursday, November 12, 2026. Participants may access the replay at 1-844-512-2921; international callers may use 1-412-317-6671 and enter access code 13763154. The call will also be available for replay via webcast link on the Investors portion of the CSW website www.csw.com.

Safe Harbor Statement

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Words or phrases such as “may,” “should,” “expects,” “could,” “intends,” “plans,” “anticipates,” “estimates,” “believes,” “forecasts,” “predicts” or other similar expressions are intended to identify forward-looking statements, which include, without limitation, earnings forecasts, effective tax rate, statements relating to our business strategy and statements of expectations, beliefs, future plans and strategies and anticipated developments concerning our industry, business, operations, and financial performance and condition.

The forward-looking statements included in this press release are based on our current expectations, projections, estimates, and assumptions. These statements are only predictions, not guarantees. Such forward-looking statements are subject to numerous risks and uncertainties that are difficult to predict. These risks and uncertainties may cause actual results to differ materially from what is forecast in such forward-looking statements, and include, without limitation, the risk factors described from time to time in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K.

All forward-looking statements included in this press release are based on information currently available to us, and we assume no obligation to update any forward-looking statement except as may be required by law.

Non-GAAP Financial Measures

This press release includes an analysis of adjusted diluted earnings per share attributable to CSW, adjusted net income attributable to CSW, adjusted effective tax rate, adjusted gross profit, adjusted operating expenses, adjusted operating income, free cash flows, adjusted EBS excluding Greco, adjusted CSW excluding Greco and Net Debt to Adjusted EBITDA Ratio per Revolving Credit Facility (“RCF”), which are non-GAAP financial measures of performance. Attributable to CSW is defined to exclude the income attributable to the non-controlling interest in the Whitmore JV.

CSW utilizes adjusted EBITDA (earnings before interest, tax, depreciation and amortization) as an additional consolidated, non-GAAP financial measure, which consists of consolidated net income including income attributable to the non-controlling interest in the Whitmore JV, adjusted to remove the impact of income taxes, interest expense, depreciation, amortization and impairment, and significant nonrecurring items.

For a reconciliation of these measures to the most directly comparable GAAP measures and for a discussion of why we consider these non-GAAP measures useful, see the “Reconciliation of Non-GAAP Measures” section of this release.

About CSW Industrials, Inc.

CSW Industrials is a diversified industrial growth company with industry-leading operations in three segments: Contractor Solutions, Specialized Reliability Solutions, and Engineered Building Solutions. CSW provides niche, value-added products with two essential commonalities: performance and reliability. The primary end markets we serve with our well-known brands include: HVAC/R, plumbing, electrical, general industrial, architecturally-specified building products, energy, mining, and rail transportation. For more information, please visit www.csw.com.

Investor Relations

Alexa Huerta
Vice President, Investor Relations and Treasurer
214-489-7113
alexa.huerta@csw.com

CSW INDUSTRIALS, INC. CONSOLIDATED STATEMENTS OF INCOME (unaudited)
	Three Months Ended September 30,								Six Months Ended September 30,
(Amounts in thousands, except per share amounts)	2026				2025				2026				2025
Revenues, net	$	361,435			$	276,951			$	712,085			$	540,597
Cost of revenues		(209,511	)			(157,766	)			(402,800	)			(305,970	)
Gross profit		151,924				119,185				309,285				234,627
Selling, general and administrative expenses		(76,392	)			(62,405	)			(153,899	)			(122,971	)
Operating income		75,532				56,780				155,386				111,656
Interest expense, net		(12,464	)			(1,320	)			(25,194	)			(2,341	)
Other income (loss), net		44				8				(178	)			536
Income before income taxes		63,112				55,468				130,014				109,851
Provision for income taxes		(15,225	)			(14,654	)			(32,347	)			(27,867	)
Net income		47,887				40,814				97,667				81,984
Less: Income attributable to		(545	)			(158	)			(566	)			(403	)
Net income attributable to CSW	$	47,342			$	40,656			$	97,101			$	81,581
Net income per share attributable to CSW
Basic	$	2.91			$	2.42			$	5.95			$	4.86
Diluted	$	2.90			$	2.41			$	5.94			$	4.84
Weighted average number of shares outstanding:
Basic		16,291				16,785				16,310				16,796
Diluted		16,333				16,842				16,349				16,852

CSW INDUSTRIALS, INC. CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except for per share amounts)	September 30, 2026				March 31, 2026
	(unaudited)				(a)
ASSETS
Current assets:
Cash and cash equivalents	$	37,204			$	33,799
Accounts receivable, net of allowance for expected credit losses of $2,577 and $2,314, respectively		215,113				210,264
Inventories, net		314,781				309,707
Prepaid expenses and other current assets		37,111				26,555
Assets held for sale		11,058				8,742
Total current assets		615,267				589,067
Property, plant and equipment, net of accumulated depreciation of $134,079 and $125,552, respectively		108,090				107,536
Goodwill		640,230				632,631
Intangible assets, net		872,623				900,051
Other assets		92,730				87,399
Total assets	$	2,328,940			$	2,316,684
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	104,489			$	76,930
Accrued and other current liabilities		122,460				116,055
Current portion of long-term debt		29,458				29,458
Liabilities held for sale		5,041				4,478
Total current liabilities		261,448				226,921
Long-term debt		735,105				839,836
Retirement benefits payable		1,018				1,040
Other long-term liabilities		194,323				179,489
Total liabilities		1,191,894				1,247,286
Commitments and contingencies
Redeemable noncontrolling interest		19,555				18,989
Equity:
Common shares		179				178
Additional paid-in capital		531,827				520,076
Treasury shares, at cost		(294,780	)			(257,704	)
Retained earnings		886,214				798,956
Accumulated other comprehensive loss		(5,949	)			(11,097	)
Total equity		1,117,491				1,050,409
Total liabilities, redeemable noncontrolling interest and equity	$	2,328,940			$	2,316,684
(a) Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2026

CSW INDUSTRIALS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
	Six Months Ended September 30,
(Amounts in thousands)	2026				2025
Cash flows from operating activities:
Net income	$	97,667			$	81,984
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		8,955				7,848
Amortization of acquisition-related intangible assets & inventory step-up		30,897				19,889
Amortization of deferred financing fees		616				499
Provision for inventory reserves		4,414				218
Provision for credit losses		468				249
Share-based compensation		7,724				7,628
Net loss on disposals of property, plant and equipment		400				208
Net pension benefit		38				33
Net deferred taxes		1,363				296
Changes in operating assets and liabilities:
Accounts receivable		(6,576	)			11,685
Inventories		(11,046	)			(10,129	)
Prepaid expenses and other current assets		(7,856	)			(5,679	)
Other assets		222				176
Accounts payable and other current liabilities		43,700				7,298
Retirement benefits payable and other liabilities		63				264
Net cash provided by operating activities		171,049				122,467
Cash flows from investing activities:
Capital expenditures		(9,501	)			(5,984	)
Proceeds from sale of assets		183				54
Cash paid for acquisitions, net of cash received		(560	)			(325,509	)
Net cash used in investing activities		(9,878	)			(331,439	)
Cash flows from financing activities:
Borrowings on line of credit		88,779				138,394
Repayments of line of credit		(178,779	)			(78,394	)
Repayments on Term Loan A		(15,000	)			—
Payments of deferred loan costs		—				(2,837	)
Payments of deferred and contingent considerations		(225	)			(4,875	)
Purchase of treasury shares		(42,182	)			(26,073	)
Distributions to redeemable noncontrolling interest shareholder		—				(2,000	)
Dividends		(9,797	)			(9,074	)
Net cash (used in) provided by financing activities		(157,204	)			15,141
Effect of exchange rate changes on cash and equivalents		(562	)			(543	)
Net change in cash and cash equivalents		3,405				(194,374	)
Cash and cash equivalents, beginning of period		33,799				225,845
Cash and cash equivalents, end of period	$	37,204			$	31,471

Reconciliation of Non-GAAP Measures

We use adjusted earnings per share attributable to CSW, adjusted net income attributable to CSW, adjusted gross profit, adjusted operating expenses, adjusted operating income, adjusted effective tax rate, adjusted EBITDA, free cash flows, adjusted EBS excluding Greco, adjusted CSW excluding Greco and Net Debt to Adjusted EBITDA Ratio per Revolving Credit Facility (“RCF”), together with financial measures prepared in accordance with GAAP, such as revenue, cost of revenue, operating expense, operating income, net income attributable to CSW and operating cash flows, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. Free cash flows is a non-GAAP financial measure and is defined as cash flows from operations less capital expenditures. We believe these measures are useful for investors to assess the operating performance of our business without the effect of non-recurring items. In the following tables, there could be immaterial differences in amounts presented due to rounding.

CSW INDUSTRIALS, INC.
Reconciliation of Net Income Attributable to CSW to Adjusted Net Income Attributable to CSW
(unaudited)
(Amounts in thousands, except per share data)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
Net income attributable to CSW	$	47,342			$	40,656			$	97,101			$	81,581
Adjusting items:
Amortization of acquisition-related intangible assets and inventory step-up		15,301				10,478				30,934				19,890
Amortization tax effect		(3,788	)			(2,588	)			(7,659	)			(4,913	)
Acquisition-related integration expenses, net of tax effect		871				—				1,906				—
Acquisition-related transaction expenses, net of tax effect		—				1,325				—				1,325
Greco Plan related expenses, net of tax effect		64				—				294				—
Adjusted net income attributable to CSW	$	59,790			$	49,871			$	122,575			$	97,883
Net Income Attributable to CSW per diluted common share	$	2.90			$	2.41			$	5.94			$	4.84
Adjusting Items, per dilutive common share:
Amortization of acquisition-related intangible assets and inventory step-up		0.94				0.62				1.89				1.18
Amortization tax effect		(0.23	)			(0.15	)			(0.47	)			(0.29	)
Acquisition-related integration expenses, net of tax effect		0.05				—				0.12				—
Acquisition-related transaction expenses, net of tax effect		—				0.08				—				0.08
Greco Plan related expenses, net of tax effect		—				—				0.02				—
Adjusted net income attributable to CSW per dilutive common share	$	3.66			$	2.96			$	7.50			$	5.81

CSW INDUSTRIALS, INC.
Reconciliation of Effective Tax Rate to Adjusted Effective Tax Rate
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
GAAP income before tax	$	63,112			$	55,468			$	130,014			$	109,851
Adjusting items:
Acquisition-related integration expenses		1,154				—				2,542				—
Acquisition-related transaction expenses		—				1,759				—				1,759
Greco Plan related expenses		85				—				392				—
Reversal of tax indemnification receivable		300				—				300				—
Adjusted income before tax	$	64,651			$	57,227			$	133,249			$	111,610
GAAP provision for income tax	$	15,225			$	14,655			$	32,347			$	27,866
Adjusting items:
Tax effect of acquisition-related integration expenses		282				—				636				—
Tax effect of acquisition-related transaction expenses		—				434				—				434
Tax effect of Greco Plan related expenses		21				—				98				—
Tax effect of reversal of tax indemnification receivable		300				—				300				—
Adjusted provision for income tax	$	15,828			$	15,089			$	33,382			$	28,301
GAAP effective tax rate		24.1	%			26.4	%			24.9	%			25.4	%
Adjusted effective tax rate		24.5	%			26.4	%			25.1	%			25.4	%

CSW INDUSTRIALS, INC.
Reconciliation of Net Income Attributable to CSW to Adjusted EBITDA
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
Net Income attributable to CSW	$	47,342			$	40,656			$	97,101			$	81,581
Plus: Income attributable to redeemable noncontrolling interest		545				158				566				403
Net Income	$	47,887			$	40,814			$	97,667			$	81,984
Adjusting Items:
Interest expense, net		12,464				1,320				25,194				2,342
Income tax expense		15,225				14,655				32,347				27,866
Depreciation & amortization		19,594				14,392				39,853				27,730
EBITDA	$	95,169			$	71,180			$	195,061			$	139,922
EBITDA Adjustments:
Acquisition-related integration expenses		1,154				—				2,542				—
Acquisition-related transaction expenses		—				1,759				—				1,759
Greco Plan related expenses		85				—				392				—
Reversal of tax indemnification receivable		300				—				300				—
Adjusted EBITDA	$	96,708			$	72,939			$	198,295			$	141,681
Adjusted EBITDA % Revenue		26.8	%			26.3	%			27.8	%			26.2	%

CSW INDUSTRIALS, INC.
Reconciliation of Gross Profit to Adjusted Gross Profit
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
Gross Profit	$	151,924			$	119,185			$	309,285			$	234,627
Gross Profit % Revenue		42.0	%			43.0	%			43.4	%			43.4	%
Adjusting Items:
Acquisition-related integration expenses		408				—				761				—
Greco Plan related expenses		—				—				279				—
Adjusted Gross Profit	$	152,332			$	119,185			$	310,325			$	234,627
Adjusted Gross Profit % Revenue		42.1	%			43.0	%			43.6	%			43.4	%

CSW INDUSTRIALS, INC.
Reconciliation of Operating Expenses to Adjusted Operating Expenses
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
Operating expenses (a)	$	76,393			$	62,405			$	153,899			$	122,971
Operating expenses % Revenue		21.1	%			22.5	%			21.6	%			22.7	%
Adjusting Items:
Acquisition-related integration expenses		(745	)			—				(1,782	)			—
Acquisition-related transaction expenses		—				(1,759	)			—				(1,759	)
Greco Plan related expenses		(85	)			—				(113	)			—
Adjusted Operating expenses	$	75,562			$	60,646			$	152,004			$	121,212
Adjusted Operating expenses % Revenue		20.9	%			21.9	%			21.3	%			22.4	%

(a) Operating expenses include selling, general, and administrative expense and impairment expense.

CSW INDUSTRIALS, INC.
Reconciliation of Segment Operating Income to Segment Adjusted EBITDA
(unaudited)
(Amounts in thousands)		Three Months Ended September 30, 2026
		Contractor Solutions			Specialized Reliability Solutions			Engineered Building Solutions			Corporate and Other			Consolidated
Revenue, net		$	285,790		$	49,509		$	28,373		$	(2,237	)	$	361,435
Operating Income		$	69,692		$	8,926		$	3,419		$	(6,505	)	$	75,532
% Revenue			24.4	%		18.0	%		12.0	%					20.9	%
Adjusting Items:
Acquisition-related integration expenses			795			359			—			—			1,154
Greco Plan related expenses			—			—			85			—			85
Adjusted Operating Income		$	70,487		$	9,284		$	3,504		$	(6,505	)	$	76,770
% Revenue			24.7	%		18.8	%		12.4	%					21.2	%
Adjusting Items:
Other income (expense), net			180			(153	)		9			8			44
Depreciation & amortization			17,946			1,508			118			22			19,594
Reversal of tax indemnification receivable			300			—			—			—			300
Adjusted EBITDA		$	88,912		$	10,640		$	3,631		$	(6,474	)	$	96,708
% Revenue			31.1	%		21.5	%		12.8	%					26.8	%

(Amounts in thousands)		Three Months Ended September 30, 2025
		Contractor Solutions			Specialized Reliability Solutions			Engineered Building Solutions			Corporate and Other			Consolidated
Revenue, net		$	208,468		$	38,806		$	31,914		$	(2,236	)	$	276,951
Operating Income		$	53,375		$	5,093		$	4,832		$	(6,519	)	$	56,780
% Revenue			25.6	%		13.1	%		15.1	%					20.5	%
Adjusting Items:
Acquisition-related transaction expenses			1,550			—			—			209			1,759
Adjusted Operating Income		$	54,925		$	5,093		$	4,832		$	(6,310	)	$	58,539
% Revenue			26.3	%		13.1	%		15.1	%					21.1	%
Adjusting Items:
Other income (expense), net			133			(19	)		(40	)		(67	)		8
Depreciation and amortization			12,555			1,347			440			49			14,392
Adjusted EBITDA		$	67,613		$	6,421		$	5,233		$	(6,328	)	$	72,939
% Revenue			32.4	%		16.5	%		16.4	%					26.3	%

		Six Months Ended September 30, 2026
(Amounts in thousands)		Contractor Solutions			Specialized Reliability Solutions			Engineered Building Solutions			Corporate and Other			Consolidated
Revenue, net		$	561,798		$	97,703		$	57,311		$	(4,726	)	$	712,085
Operating Income		$	144,708		$	16,980		$	7,992		$	(14,294	)	$	155,386
% Revenue			25.8	%		17.4	%		13.9	%					21.8	%
Adjusting Items:
Acquisition-related integration expenses			1,706			837			—			—			2,542
Greco Plan related expenses			—			—			392			—			392
Adjusted Operating Income			146,414			17,817			8,384			(14,294	)		158,320
% Revenue			26.1	%		18.2	%		14.6	%					22.2	%
Adjusting Items:
Other income (expense), net			(10	)		(152	)		44			(59	)		(177	)
Depreciation & amortization			36,558			3,012			236			47			39,853
Reversal of tax indemnification receivable			300			—			—			—			300
Adjusted EBITDA			183,261			20,676			8,663			(14,305	)		198,296
% Revenue			32.6	%		21.2	%		15.1	%					27.8	%

		Six Months Ended September 30, 2025
(Amounts in thousands)		Contractor Solutions			Specialized Reliability Solutions			Engineered Building Solutions			Corporate and Other			Consolidated
Revenue, net		$	405,208		$	75,611		$	63,810		$	(4,033	)	$	540,597
Operating Income		$	106,134		$	10,335		$	8,831		$	(13,643	)	$	111,656
% Revenue			26.2	%		13.7	%		13.8	%					20.7	%
Adjusting Items:
Acquisition-related transaction expenses			1,550			—			—			209			1,759
Adjusted Operating Income		$	107,684		$	10,335		$	8,831		$	(13,434	)	$	113,415
% Revenue			26.6	%		13.7	%		13.8	%					21.0	%
Adjusting Items:
Other income (expense), net			831			(94	)		(32	)		(168	)		536
Depreciation & amortization			24,095			2,684			856			94			27,730
Adjusted EBITDA		$	132,609		$	12,924		$	9,655		$	(13,508	)	$	141,681
% Revenue			32.7	%		17.1	%		15.1	%					26.2	%

CSW INDUSTRIALS, INC.
Reconciliation of Operating Cash Flows to Free Cash Flows
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,								Six Months Ended September 30,
	2026				2025				2026				2025
Net cash provided by operating activities	$	95,429			$	61,826			$	171,049			$	122,467
Less: Capital expenditures	$	(3,497	)		$	(3,080	)		$	(9,501	)		$	(5,984	)
Free cash flow	$	91,932			$	58,746			$	161,548			$	116,483
Adjusted EBITDA	$	96,708			$	72,939			$	198,295			$	141,681
Free cash flow % Adj. EBITDA		95.1	%			80.5	%			81.5	%			82.2	%

CSW INDUSTRIALS, INC.
Reconciliation of Adjusted CSW to Adjusted CSW excluding Greco
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,
	2026										2025
	CSW Consolidated			Greco Consolidated			CSW Consolidated excluding Greco				CSW Consolidated			Greco Consolidated			CSW Consolidated excluding Greco
Revenues, net	$	361,435		$	5,723		$	355,713			$	276,951		$	9,799		$	267,152
Adjusted EBITDA		96,708			(738	)		97,447				72,939			336			72,603
Adjusted EBITDA Margin		26.8	%	(12.9)%				27.4	%			26.3	%		3.4	%		27.2	%
Amortization Adjusted EPS	$	3.66		$	(0.03	)	$	3.69			$	2.96		$	0.01		$	2.95
(Amounts in thousands)	Six Months Ended September 30,
	2026										2025
	CSW Consolidated			Greco Consolidated			CSW Consolidated excluding Greco				CSW Consolidated			Greco Consolidated			CSW Consolidated excluding Greco
Revenues, net	$	712,085		$	11,230		$	700,854			$	540,597		$	19,803		$	520,793
Adjusted EBITDA		198,295			(1,856	)		200,151				141,681			932			140,749
Adjusted EBITDA Margin		27.8	%	(16.5)%				28.6	%			26.2	%		4.7	%		27.0	%
Amortization Adjusted EPS	$	7.50		$	(0.09	)	$	7.59			$	5.81		$	0.03		$	5.78

CSW INDUSTRIALS, INC.
Reconciliation of Adjusted EBS to Adjusted EBS excluding Greco
(unaudited)
(Amounts in thousands)	Three Months Ended September 30,
	2026										2025
	EBS			Greco Consolidated			EBS, excluding Greco				EBS			Greco Consolidated			EBS, excluding Greco
Revenues, net	$	28,373		$	5,723		$	22,651			$	31,914		$	9,799		$	22,115
Adjusted EBITDA		3,631			(738	)		4,369				5,233			336			4,897
Adjusted EBITDA Margin		12.8	%	(12.9)%				19.3	%			16.4	%		3.4	%		22.1	%
(Amounts in thousands)	Six Months Ended September 30,
	2026										2025
	EBS			Greco Consolidated			EBS, excluding Greco				EBS			Greco Consolidated			EBS, excluding Greco
Revenues, net	$	57,311		$	11,230		$	46,080			$	63,810		$	19,803		$	44,007
Adjusted EBITDA		8,663			(1,856	)		10,519				9,655			932			8,723
Adjusted EBITDA Margin		15.1	%	(16.5)%				22.8	%			15.1	%		4.7	%		19.8	%

CSW INDUSTRIALS, INC.
Net Debt to Adjusted EBITDA Ratio per Revolving Credit Facility (“RCF”)
(Unaudited)
(in thousands, except net debt to adjusted EBITDA ratio)	Trailing Twelve Months Period Ending September 30, 2026
GAAP debt	$	766,500
Minus: GAAP cash		(37,204	)
Add: Restricted cash per RCF		4,814
Add: Capital lease liabilities		298
Net debt per RCF	$	734,408
GAAP Net Income		128,529
Interest expense, net		45,097
Income tax expense		37,187
Depreciation & amortization		79,194
Greco impairment expense		15,627
Proforma EBITDA for acquisitions		6,558
Stock compensation expenses		15,010
Acquisition transaction and integration expenses		12,819
Prior year ESOP contribution		5,235
Greco Plan related expenses		2,601
Non-cash tax indemnification expense		1,756
Nonrecurring restructuring expenses		542
Other misc. adjustments per RCF		313
Adjusted EBITDA per RCF	$	350,468
Net debt to adjusted EBITDA ratio per RCF	2.10x

GREENWICH, Conn., Oct. 29, 2026 (GLOBE NEWSWIRE) — XPO (NYSE: XPO) today announced its financial results for the third quarter 2026. The company reported diluted earnings per share of $1.53, compared with $0.68 for the same period in 2025, and adjusted diluted earnings per share of $1.70, compared with $1.07 for the same period in 2025.

Third Quarter 2026 Summary Results
	Three Months Ended September 30,
	Revenue								Operating Income (Loss)(1)
(in millions)		2026			2025		Change %			2026			2025		Change %
North American Less-Than-Truckload Segment	$	1,473		$	1,255		17.4%		$	284		$	208		36.5%
European Transportation Segment		900			857		5.0%			12			(2)		NM
Corporate		–			–		0.0%			(8)			(42)		-81.0%
Total	$	2,373		$	2,111		12.4%		$	288		$	164		75.6%
	Adjusted Operating Income(2)								Adjusted EBITDA(2)
(in millions)		2026			2025		Change %			2026			2025		Change %
North American Less-Than-Truckload Segment	$	293		$	217		35.0%		$	389		$	308		26.3%
European Transportation Segment		22			9		144.4%			48			38		26.3%
Corporate		NA			NA		NA			(4)			(4)		0.0%
Total	$	NA		$	NA		NA		$	433		$	342		26.6%
	Net Income(1)								Diluted EPS(1)
(in millions, except for per-share data)		2026			2025		Change %			2026			2025		Change %
Total	$	181		$	82		120.7%		$	1.53		$	0.68		125.0%
	Diluted Weighted-Average Common Shares Outstanding								Adjusted Diluted EPS(2)
(in millions, except for per-share data)		2026			2025					2026			2025		Change %
Total		118			120				$	1.70		$	1.07		58.9%
Amounts may not add due to rounding.
NM – Not meaningful
NA – Not applicable
(1) Third quarter 2025 includes a $35 million charge ($27 million after-tax or -$0.23 per share) related to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO’s acquisition of Con-way in 2015.
(2) See the “Non-GAAP Financial Measures” section of the press release.

Mario Harik, chairman and chief executive officer of XPO, said, “We delivered another quarter of outstanding performance, accelerating growth in adjusted EBITDA to 27% and adjusted diluted EPS to 59% year-over-year. Our results show how effectively we’re converting more business into higher earnings through a combination of revenue growth and margin expansion.

“In North American LTL, we grew adjusted operating income by 35% year-over-year and improved our adjusted operating ratio by 260 basis points, significantly outperforming seasonality. This reflects sequential improvements in both yield and revenue per shipment, excluding fuel, alongside stronger volume growth from profitable share gains. Increasingly, we’re improving revenue quality with higher-margin freight as customers value our world-class service, including a damage claims ratio below 0.2%. And on the cost side, we’re operating more efficiently by expanding the use of AI across our network.”

Harik continued, “Our strong performance across North America and Europe underscores the substantial opportunities we have to continue compounding our earnings growth, with further upside as freight demand recovers. Additionally, we’re accelerating our free cash flow and capital return to shareholders, enhancing long-term value.”

Third Quarter Highlights

For the third quarter 2026, the company generated revenue of $2.37 billion, compared with $2.11 billion for the same period in 2025.

Operating income was $288 million for the third quarter, compared with $164 million for the same period in 2025. Net income was $181 million for the third quarter, compared with $82 million for the same period in 2025. Diluted earnings per share was $1.53 for the third quarter, compared with $0.68 for the same period in 2025.

Adjusted net income, a non-GAAP financial measure, was $200 million for the third quarter, compared with $128 million for the same period in 2025. Adjusted diluted EPS, a non-GAAP financial measure, was $1.70 for the third quarter, compared with $1.07 for the same period in 2025.

Adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), a non-GAAP financial measure, was $433 million for the third quarter, compared with $342 million for the same period in 2025.

The company generated $415 million of cash flow from operating activities in the third quarter and ended the quarter with $260 million of cash and cash equivalents on hand, after completing $123 million of net capital expenditures, $150 million of common stock repurchases and $100 million of term loan repayments.

Results by Business Segment

• North American Less-Than-Truckload (LTL): The segment grew revenue to $1.47 billion for the third quarter 2026, compared with $1.26 billion for the same period in 2025. On a year-over-year basis, yield, excluding fuel, increased 3.6%, shipments per day increased 5.8%, and tonnage per day increased 5.0%.

  Operating income increased to $284 million for the third quarter, compared with $208 million for the same period in 2025. Adjusted operating income, a non-GAAP financial measure, increased to $293 million for the third quarter, compared with $217 million for the same period in 2025. Adjusted operating ratio, a non-GAAP financial measure, was 80.1%, reflecting a year-over-year improvement of 260 basis points.

  Adjusted EBITDA for the third quarter was $389 million, compared with $308 million for the same period in 2025. The increase in adjusted EBITDA reflects yield growth, higher tonnage per day, cost efficiencies and higher fuel surcharge revenue, partially offset by higher fuel costs and wage inflation.

• European Transportation: The segment grew revenue to $900 million for the third quarter 2026, compared with $857 million for the same period in 2025. Operating income increased to $12 million for the third quarter, compared with a loss of $2 million for the same period in 2025.

  Adjusted EBITDA increased to $48 million for the third quarter, compared with $38 million for the same period in 2025. The increase in adjusted EBITDA reflects higher revenue and cost efficiencies, partially offset by higher fuel costs.

• Corporate: The segment generated an operating loss of $8 million for the third quarter 2026, compared with a loss of $42 million for the same period in 2025.

  Adjusted EBITDA was a loss of $4 million for the third quarter, consistent with the same period in 2025.

Conference Call

The company will hold a conference call on Thursday, October 29, 2026, at 8:30 a.m. Eastern Time. Participants can call toll-free (from US/Canada) 1-877-269-7756; international callers dial +1-201-689-7817. A live webcast of the conference will be available on the investor relations area of the company’s website, xpo.com/investors. The conference will be archived until November 28, 2026. To access the replay by phone, call toll-free (from US/Canada) 1-877-660-6853; international callers dial +1-201-612-7415. Use participant passcode 13762528.

About XPO

XPO, Inc. (NYSE: XPO) is a leader in asset-based less-than-truckload (LTL) freight transportation in North America. The company’s customer-focused organization efficiently moves 17 billion pounds of freight per year, enabled by its proprietary technology. XPO serves 55,000 customers with 575 locations and 38,000 employees in North America and Europe, and is headquartered in Greenwich, Conn., USA. Visit xpo.com for more information, and connect with XPO on LinkedIn, Facebook, X, Instagram and YouTube.

Non-GAAP Financial Measures

As required by the rules of the Securities and Exchange Commission (“SEC”), we provide reconciliations of the non-GAAP financial measures contained in this press release to the most directly comparable measures under GAAP, which are set forth in the financial tables attached to this press release.

XPO’s non-GAAP financial measures in this press release include: adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) on a consolidated basis and for corporate; adjusted EBITDA margin on a consolidated basis; adjusted EBITDA, excluding gains on real estate transactions on a consolidated basis and for our North American Less-Than-Truckload segment; adjusted net income; adjusted diluted earnings per share (“adjusted diluted EPS”); adjusted diluted EPS, excluding gains on real estate transactions; adjusted operating income for our North American Less-Than-Truckload and European Transportation segments; and adjusted operating ratio for our North American Less-Than-Truckload segment.

We believe that the above adjusted financial measures facilitate analysis of our ongoing business operations because they exclude items that may not be reflective of, or are unrelated to, XPO and its business segments’ core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. Other companies may calculate these non-GAAP financial measures differently, and therefore our measures may not be comparable to similarly titled measures of other companies. These non-GAAP financial measures should only be used as supplemental measures of our operating performance.

Adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA, excluding gains on real estate transactions, adjusted net income, adjusted diluted EPS, adjusted diluted EPS, excluding gains on real estate transactions, adjusted operating income and adjusted operating ratio include adjustments for transaction and integration costs, as well as restructuring costs and other adjustments as set forth in the attached tables. Transaction and integration adjustments are generally incremental costs that result from an actual or planned acquisition, divestiture or spin-off and may include transaction costs, consulting fees, stock-based compensation, retention awards, internal salaries and wages (to the extent the individuals are assigned full-time to integration and transformation activities) and certain costs related to integrating and converging IT systems. Restructuring costs primarily relate to severance costs associated with business optimization initiatives. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and evaluating XPO’s and each business segment’s ongoing performance.

We believe that adjusted EBITDA, adjusted EBITDA margin and adjusted EBITDA, excluding gains on real estate transactions improve comparability from period to period by removing the impact of our capital structure (interest and financing expenses), asset base (depreciation and amortization), tax impacts and other adjustments as set out in the attached tables that management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in our underlying businesses. We believe that adjusted net income, adjusted diluted EPS and adjusted diluted EPS, excluding gains on real estate transactions improve the comparability of our operating results from period to period by removing the impact of certain costs and gains that management has determined are not reflective of our core operating activities, including amortization of acquisition-related intangible assets, transaction and integration costs, restructuring costs and other adjustments as set out in the attached tables. We believe that adjusted operating income and adjusted operating ratio improve the comparability of our operating results from period to period by removing the impact of certain transaction and integration costs and restructuring costs, as well as amortization expense and other adjustments as set out in the attached tables.

Forward-looking Statements

This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. In some cases, forward-looking statements can be identified by the use of forward-looking terms such as “anticipate,” “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target,” “trajectory” or the negative of these terms or other comparable terms. These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances.

These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions that may cause actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause or contribute to a material difference include the risks discussed in our filings with the SEC, and the following: the effects of business, economic, political, legal, and regulatory impacts or conflicts upon our operations; supply chain disruptions and shortages, strains on production or extraction of raw materials, cost inflation and labor and equipment shortages; our ability to align our investments in capital assets, including equipment, service centers, and warehouses to our customers’ demands; our ability to implement our cost and revenue initiatives and accelerate growth and expansion as a result of those initiatives; our ability to improve pricing growth; the effectiveness of our action plan, and other management actions, to improve our North American LTL business; our ability to continue insourcing linehaul in ways that enhance our network efficiency and productivity; the anticipated impact of a freight market recovery on our business; our ability to capture profitable share gains, facilitate yield growth, accelerate free cash flow, and improve margins to enhance shareholder value; our ability to benefit from a sale, spin-off or other divestiture of one or more business units or to successfully integrate and realize anticipated synergies, cost savings and profit opportunities from acquired companies; goodwill impairment; issues related to compliance with data protection laws, competition laws, and intellectual property laws; fluctuations in currency exchange rates, fuel prices and fuel surcharges; our ability to develop and implement proprietary technology and suitable information technology systems that contribute to financial, operational, competitive and productivity efficiencies and improvements; the impact of potential cyber-attacks and information technology or data security breaches or failures; our ability to repurchase shares on favorable terms; our indebtedness; our ability to raise debt and equity capital; fluctuations in interest rates; seasonal fluctuations; our ability to maintain positive relationships with our network of third-party transportation providers; our ability to attract and retain management talent and key employees including qualified drivers; labor matters; litigation; and competition.

All forward-looking statements set forth in this release are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to or effects on us or our business or operations. Forward-looking statements set forth in this release speak only as of the date hereof, and we do not undertake any obligation to update forward-looking statements except to the extent required by law.

Investor Contact
Brian Scasserra
+1 617-607-6429
brian.scasserra@xpo.com

Media Contact
Cole Horton
+1 203-609-6004
cole.horton@xpo.com

XPO, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(In millions, except per share data)
	Three Months Ended											Nine Months Ended
	September 30,											September 30,
		2026				2025			Change %				2026				2025			Change %
Revenue	$	2,373			$	2,111			12.4	%		$	6,823			$	6,146			11.0	%
Salaries, wages and employee benefits		949				876			8.3	%			2,759				2,579			7.0	%
Purchased transportation		451				424			6.4	%			1,338				1,250			7.0	%
Fuel, operating expenses and supplies		488				406			20.2	%			1,387				1,183			17.2	%
Operating taxes and licenses		20				21			-4.8	%			63				61			3.3	%
Insurance and claims		32				43			-25.6	%			107				118			-9.3	%
(Gains) losses on sales of property and equipment		2				1			100.0	%			(6	)			(2	)		200.0	%
Depreciation and amortization expense		134				134			0.0	%			398				388			2.6	%
Pre-Con-way acquisition environmental matter(1)		–				35			-100.0	%			1				35			-97.1	%
Legal matters(2)		–				–			0.0	%			–				(13	)		-100.0	%
Transaction and integration costs		3				1			200.0	%			7				7			0.0	%
Restructuring costs		5				6			-16.7	%			36				26			38.5	%
Operating income		288				164			75.6	%			733				513			42.9	%
Other income		(3	)			(2	)		50.0	%			(10	)			(4	)		150.0	%
Debt extinguishment loss		1				–			NM				6				5			20.0	%
Interest expense		50				54			-7.4	%			155				166			-6.6	%
Income before income tax provision		240				112			114.3	%			582				346			68.2	%
Income tax provision		60				30			100.0	%			138				89			55.1	%
Net income	$	181			$	82			120.7	%		$	444			$	257			72.8	%
Earnings per share data(3)
Basic earnings per share	$	1.55			$	0.69						$	3.79			$	2.18
Diluted earnings per share	$	1.53			$	0.68						$	3.75			$	2.15
Weighted-average common shares outstanding
Basic weighted-average common shares outstanding		117				118							117				118
Diluted weighted-average common shares outstanding		118				120							118				120
Amounts may not add due to rounding.
NM – Not meaningful.
(1) Relates to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO’s acquisition of Con-way in 2015, as described in Note 17 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2025.
(2) Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.
(3) The sum of quarterly earnings per share may not equal year-to-date amounts due to differences in the weighted-average number of shares outstanding during the respective periods.

XPO, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In millions, except per share data)
	September 30,				December 31,
	2026				2025
ASSETS
Current assets
Cash and cash equivalents	$	260			$	310
Accounts receivable, net of allowances of $41 and $40, respectively		1,250				1,035
Other current assets		249				285
Total current assets		1,759				1,630
Long-term assets
Property and equipment, net of $2,481 and $2,360 in accumulated depreciation, respectively		3,679				3,664
Operating lease assets		798				777
Goodwill		1,524				1,547
Identifiable intangible assets, net of $617 and $580 in accumulated amortization, respectively		266				311
Other long-term assets		282				265
Total long-term assets		6,549				6,564
Total assets	$	8,308			$	8,194
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	485			$	455
Accrued expenses		878				760
Short-term borrowings and current maturities of long-term debt		129				60
Short-term operating lease liabilities		170				166
Other current liabilities		123				113
Total current liabilities		1,785				1,555
Long-term liabilities
Long-term debt		2,995				3,253
Deferred tax liability		524				482
Employee benefit obligations		82				86
Long-term operating lease liabilities		627				611
Other long-term liabilities		322				345
Total long-term liabilities		4,550				4,778
Stockholders’ equity
Common stock, $0.001 par value; 300 shares authorized; 117 shares issued and outstanding as of
September 30, 2026 and December 31, 2025, respectively		–				–
Additional paid-in capital		834				1,160
Retained earnings		1,332				888
Accumulated other comprehensive loss		(192	)			(187	)
Total equity		1,973				1,861
Total liabilities and equity	$	8,308			$	8,194
Amounts may not add due to rounding.

XPO, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In millions)
		Nine Months Ended
		September 30,
			2026				2025
Cash flows from operating activities
Net income		$	444			$	257
Adjustments to reconcile net income to net cash from operating activities
	Depreciation and amortization		398				388
	Stock compensation expense		45				46
	Accretion of debt		8				8
	Deferred tax expense		35				72
	Gains on sales of property and equipment		(6	)			(2	)
	Other		25				19
Changes in assets and liabilities
	Accounts receivable		(256	)			(106	)
	Other assets		32				18
	Accounts payable		47				(14	)
	Accrued expenses and other liabilities		133				76
Net cash provided by operating activities			906				760
Cash flows from investing activities
	Payment for purchases of property and equipment		(369	)			(551	)
	Proceeds from sale of property and equipment		40				18
	Payment for settlement of cross-currency swaps		(3	)			–
Net cash used in investing activities			(331	)			(532	)
Cash flows from financing activities
	Proceeds from issuance of debt		885				–
	Repayment of debt		(1,085	)			(50	)
	Repayment of finance leases and other debt		(60	)			(56	)
	Payment for debt issuance costs		(1	)			(3	)
	Repurchase of common stock		(250	)			(57	)
	Change in bank overdrafts		9				24
	Payment for tax withholdings for restricted shares		(124	)			(47	)
	Other		4				3
Net cash used in financing activities			(622	)			(185	)
Effect of exchange rates on cash, cash equivalents and restricted cash			1				(1	)
Net increase (decrease) in cash, cash equivalents and restricted cash			(46	)			42
Cash, cash equivalents and restricted cash, beginning of period			330				298
Cash, cash equivalents and restricted cash, end of period		$	284			$	341
Amounts may not add due to rounding.

North American Less-Than-Truckload Segment
Summary Financial Table
(Unaudited)
(In millions)
	Three Months Ended September 30,											Nine Months Ended September 30,
	2026				2025				Change %			2026				2025				Change %
Revenue (excluding fuel surcharge revenue)	$	1,150				1,060			8.5	%		$	3,292			$	3,112			5.8	%
Fuel surcharge revenue		323				194			66.5	%			838				555			51.0	%
Revenue		1,473				1,255			17.4	%			4,130				3,667			12.6	%
Salaries, wages and employee benefits		720				648			11.1	%			2,051				1,907			7.6	%
Purchased transportation		40				30			33.3	%			109				99			10.1	%
Fuel, operating expenses and supplies(1)		291				225			29.3	%			803				679			18.3	%
Operating taxes and licenses		16				17			-5.9	%			49				50			-2.0	%
Insurance and claims		18				27			-33.3	%			60				77			-22.1	%
(Gains) losses on sales of property and equipment		3				2			50.0	%			(1	)			4			NM
Depreciation and amortization		101				98			3.1	%			298				283			5.3	%
Restructuring costs		1				–			NM				2				4			-50.0	%
Operating income		284				208			36.5	%			758				565			34.2	%
Operating ratio(2)		80.7	%			83.4	%						81.6	%			84.6	%
Amortization expense		9				9							27				27
Restructuring costs		1				–							2				4
Gains on real estate transactions		(1	)			–							(10	)			(2	)
Adjusted operating income(3)	$	293				217			35.0	%		$	778			$	594			31.0	%
Adjusted operating ratio(3) (4)		80.1	%			82.7	%						81.2	%			83.8	%
Depreciation expense		92				89							271				256
Pension income		4				2							11				5
Gains on real estate transactions		1				–							10				2
Adjusted EBITDA(5)	$	389				308			26.3	%		$	1,070			$	857			24.9	%
Adjusted EBITDA margin(5)		26.4	%			24.5	%						25.9	%			23.4	%
Gains on real estate transactions		1				–							10				3
Adjusted EBITDA, excluding gains on real estate transactions(3)	$	389				308			26.3	%		$	1,060			$	855			24.0	%
Amounts may not add due to rounding.
NM – Not meaningful.
(1) Fuel, operating expenses and supplies includes fuel-related taxes.
(2) Operating ratio is calculated as (1 – (Operating income divided by Revenue)) using the underlying unrounded amounts.
(3) See the “Non-GAAP Financial Measures” section of the press release.
(4) Adjusted operating ratio is calculated as (1 – (Adjusted operating income divided by Revenue)) using the underlying unrounded amounts; adjusted operating margin is the inverse of adjusted operating ratio.
(5) Adjusted EBITDA is used by our chief operating decision maker to evaluate segment profit (loss) in accordance with ASC 280. Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.

North American Less-Than-Truckload
Summary Data Table
(Unaudited)
	Three Months Ended September 30,									Nine Months Ended September 30,
	2026			2025			Change %			2026			2025			Change %
Pounds per day (thousands)		68,494			65,236		5.0	%			67,502			66,158		2.0	%
Shipments per day		52,988			50,094		5.8	%			51,697			49,763		3.9	%
Average weight per shipment (in pounds)		1,293			1,302		-0.7	%			1,306			1,329		-1.8	%
Revenue per shipment (including fuel surcharges)	$	434.37			391.13		11.1	%		$	420.13		$	386.54		8.7	%
Revenue per shipment (excluding fuel surcharges)	$	339.12			330.48		2.6	%		$	334.85		$	327.95		2.1	%
Gross revenue per hundredweight (including fuel surcharges)(1)	$	34.06			30.42		12.0	%		$	32.71		$	29.57		10.6	%
Gross revenue per hundredweight (excluding fuel surcharges)(1)	$	26.70			25.77		3.6	%		$	26.18		$	25.16		4.0	%
Average length of haul (in miles)		854.7			866.7						853.6			852.5
Total average load factor(2)		22,164			22,442		-1.2	%			22,247			22,548		-1.3	%
Average age of tractor fleet (years)		4.1			3.6
Number of working days		64.0			64.0						190.0			190.5
(1) Gross revenue per hundredweight excludes the adjustment required for financial statement purposes in accordance with the company’s revenue recognition policy.
(2) Total average load factor equals freight pound miles divided by total linehaul miles.
Note: Table reflects the results of the North American Less-Than-Truckload segment and excludes the European Transportation segment. Percentages presented are calculated using the underlying unrounded amounts.

European Transportation Segment
Summary Financial Table
(Unaudited)
(In millions)
	Three Months Ended September 30,											Nine Months Ended September 30,
	2026				2025				Change %			2026				2025				Change %
Revenue	$	900				857			5.0	%		$	2,694			$	2,479			8.7	%
Salaries, wages and employee benefits		225				224			0.4	%			696				660			5.5	%
Purchased transportation		411				394			4.3	%			1,229				1,151			6.8	%
Fuel, operating expenses and supplies(1)		196				180			8.9	%			584				505			15.6	%
Operating taxes and licenses		4				4			0.0	%			14				11			27.3	%
Insurance and claims		15				16			-6.3	%			46				42			9.5	%
Gains on sales of property and equipment		(1	)			(1	)		0.0	%			(5	)			(6	)		-16.7	%
Depreciation and amortization		32				35			-8.6	%			98				101			-3.0	%
Legal matters(2)		–				–			0.0	%			–				(13	)		-100.0	%
Transaction and integration costs		1				–			NM				1				–			NM
Restructuring costs		4				5			-20.0	%			31				17			82.4	%
Operating income (loss)	$	12				(2	)		NM			$	1			$	10			-90.0	%
Other expense		–				–							(1	)			(1	)
Amortization expense		5				6							16				16
Legal matters(2)		–				–							–				(13	)
Transaction and integration costs		1				–							1				–
Restructuring costs		4				5							31				17
Adjusted operating income(3)	$	22				9			144.4	%		$	48			$	30			60.0	%
Depreciation expense		26				29							81				85
Adjusted EBITDA(4)	$	48				38			26.3	%		$	129			$	115			12.2	%
Adjusted EBITDA margin(4)		5.3	%			4.5	%						4.8	%			4.6	%
Amounts may not add due to rounding.
NM – Not meaningful.
(1) Fuel, operating expenses and supplies includes fuel-related taxes.
(2) Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.
(3) See the “Non-GAAP Financial Measures” section of the press release.
(4) Adjusted EBITDA is used by our chief operating decision maker to evaluate segment profit (loss) in accordance with ASC 280. Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.

Corporate
Summary Financial Table
(Unaudited)
(In millions)
	Three Months Ended September 30,											Nine Months Ended September 30,
	2026				2025				Change %			2026				2025				Change %
Revenue	$	–			$	–			0.0	%		$	–			$	–			0.0	%
Salaries, wages and employee benefits		4				4			0.0	%			12				12			0.0	%
Depreciation and amortization		1				1			0.0	%			3				3			0.0	%
Pre-Con-way acquisition environmental matter(1)		–				35			-100.0	%			1				35			-97.1	%
Transaction and integration costs		2				1			100.0	%			5				7			-28.6	%
Restructuring costs		–				–			0.0	%			4				5			-20.0	%
Operating loss	$	(8	)		$	(42	)		-81.0	%		$	(25	)		$	(63	)		-60.3	%
Other income (expense)		–				–							–				1
Depreciation and amortization		1				1							3				3
Pre-Con-way acquisition environmental matter(1)		–				35							1				35
Transaction and integration costs		2				1							5				7
Restructuring costs		–				–							4				5
Adjusted EBITDA(2)	$	(4	)		$	(4	)		0.0	%		$	(13	)		$	(12	)		8.3	%
Amounts may not add due to rounding.
(1) Relates to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO’s acquisition of Con-way in 2015, as described in Note 17 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2025.
(2) See the “Non-GAAP Financial Measures” section of the press release.

XPO, Inc.
Reconciliation of Non-GAAP Measures
(Unaudited)
(In millions)
	Three Months Ended September 30,											Nine Months Ended September 30,
	2026				2025				Change %			2026				2025				Change %
Reconciliation of Net Income to Adjusted EBITDA
Net income	$	181			$	82			120.7	%		$	444			$	257			72.8	%
Debt extinguishment loss		1				–							6				5
Interest expense		50				54							155				166
Income tax provision		60				30							138				89
Depreciation and amortization expense		134				134							398				388
Pre-Con-way acquisition environmental matter(1)		–				35							1				35
Legal matters(2)		–				–							–				(13	)
Transaction and integration costs		3				1							7				7
Restructuring costs		5				6							36				26
Adjusted EBITDA(3)	$	433			$	342			26.6	%		$	1,186			$	960			23.5	%
Revenue	$	2,373			$	2,111			12.4	%		$	6,823			$	6,146			11.0	%
Adjusted EBITDA margin(3) (4)		18.2	%			16.2	%						17.4	%			15.6	%
Gains on real estate transactions		1				–							10				2
Adjusted EBITDA, excluding gains on real estate transactions(3)	$	432			$	342			26.3	%		$	1,176			$	958			22.8	%
Amounts may not add due to rounding.
(1) Relates to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO’s acquisition of Con-way in 2015, as described in Note 17 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2025.
(2) Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.
(3) See the “Non-GAAP Financial Measures” section of the press release.
(4) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Revenue using the underlying unrounded amounts.

XPO, Inc.
Reconciliation of Non-GAAP Measures (cont.)
(Unaudited)
(In millions, except per share data)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2026				2025				2026				2025
Reconciliation of Net Income and Diluted Earnings Per Share to Adjusted Net Income and Adjusted Earnings Per Share
Net income(1)		$	181			$	82			$	444			$	257
	Debt extinguishment loss		1				–				6				5
	Amortization of acquisition-related intangible assets		15				15				44				43
	Pre-Con-way acquisition environmental matter(2)		–				35				1				35
	Legal matters(3)		–				–				–				(13	)
	Transaction and integration costs		3				1				7				7
	Restructuring costs		5				6				36				26
	Income tax associated with the adjustments above(4)		(3	)			(12	)			(11	)			(21	)
	European legal entity reorganization(5)		–				–				(3	)			1
	Other tax adjustments		–				–				(2	)			–
Adjusted net income(1)(6)		$	200			$	128			$	522			$	340
Adjusted diluted earnings per share(1)(6)		$	1.70			$	1.07			$	4.41			$	2.85
Weighted-average common shares outstanding
	Diluted weighted-average common shares outstanding		118				120				118				120
Amounts may not add due to rounding.
(1) Includes gains from sales of real estate of $8 million ($10 million pre-tax), or $0.06 per diluted share, and $2 million ($2 million pre-tax), or $0.02 per diluted share, for the nine months ended September 30, 2026 and 2025, respectively. Excluding these gains, adjusted diluted earnings per share is $4.35 and $2.83 for the nine months ended September 30, 2026 and 2025, respectively. The gains from sales of real estate transactions in the third quarters of 2026 and 2025 were not material.
(2) Relates to environmental and product liability claims involving a former subsidiary of Con-way, which was sold prior to XPO’s acquisition of Con-way in 2015, as described in Note 17 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2025.
(3) Reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to 2015.
(4) This line item reflects the aggregate tax benefit of all non-tax related adjustments reflected in the table above. The detail by line item is as follows:
	Debt extinguishment loss	$	–			$	–			$	1			$	1
	Amortization of acquisition-related intangible assets		2				2				7				7
	Pre-Con-way acquisition environmental matter		–				8				–				8
	Transaction and integration costs		1				–				1				2
	Restructuring costs		–				1				1				3
		$	3			$	12			$	11			$	21
Amounts may not add due to rounding.
The income tax rate applied to reconciling items is based on the GAAP annual effective tax rate, excluding discrete items, non-deductible compensation, losses for which no tax benefit can be recognized, and contribution- and margin-based taxes.
(5) Reflects an adjustment recognized during the first quarters of 2026 and 2025 to the tax benefit recognized in the second quarter of 2024 related to a legal entity reorganization within our European Transportation business.
(6) See the “Non-GAAP Financial Measures” section of the press release.