XPO, Inc.
For the period ended Jun 30, 2026. Filed Jul 30, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Jul 30, 2026
XPO$176.95+0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-04-30.
0001166003-26-000063
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-07-30.
0001166003-26-000074
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 80 previous paragraphs and 91 current paragraphs.
38 unchanged; 38 reworded; 13 added; 4 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
NM - Not meaningful.
Current report
Gains on sales of property and equipment for the second quarter of 2026 was $7 million, compared with $1 million for the same quarter in 2025. Gains on sales of property and equipment for the first six months of 2026 was $8 million, compared with $3 million for the same period in 2025. The year-over-year increase was due to the timing of gains on real estate transactions in our North American LTL segment.
Current report
Debt extinguishment loss for the second quarter of 2026 was $5 million, compared with $0 million for the same period in 2025. Debt extinguishment loss for the first six months of 2026 was $5 million, compared with $5 million for the same period in 2025. Debt extinguishment loss in both years primarily related to refinancings of our term loan facility.
Current report
Adjusted EBITDA was $48 million for the second quarter of 2026, compared with $44 million for the same quarter in 2025. Adjusted EBITDA was $81 million for the first six months of 2026, compared with $76 million for the same period in 2025. The increase in adjusted EBITDA in both the second quarter and the first six months of 2026 primarily reflects higher revenue, partially offset by higher fuel costs, operating lease and facility costs, purchased transportation and salaries, wages and employee benefits.
Current report
Term Loan A Facility
Current report
In May 2026, we entered into a Senior Secured Term Loan A Credit Agreement (the “Term Loan A Credit Agreement”). The agreement provides for a senior secured term loan A facility in an initial aggregate amount of $500 million, maturing on May 29, 2029 (the “Term Loan A Facility”). Proceeds from the Term Loan A Facility were drawn in full on the closing date and, together with the proceeds from the 2026 Term Loan B Facility, defined below, were used to repay borrowings under the existing term loan B credit agreement.
Current report
The Term Loan A Facility bears interest at a rate per annum equal to, at the Company’s option, either alternate base rate (“ABR”) or Term Secured Overnight Financing Rate (“SOFR”) plus (i) in the case of ABR loans, 0.25% or, (ii) in the case of Term SOFR loans, 1.25%, which, on or after September 30, 2026, shall be reduced by 0.125% upon achievement of a leverage ratio defined in the Term Loan A Credit Agreement. In the third year of the facility, the Term Loan A Facility is subject to amortization of principal, payable in quarterly installments, equal to 5% of the original principal amount per annum, which may be reduced by prepayments.
Current report
Subject to customary exceptions, the Term Loan A Facility includes customary prepayment requirements, representations and warranties, events of default, reporting and other affirmative and negative covenants, including limitations on indebtedness, liens, investments, dividends, repayments of junior financings and asset sales, and is secured by a lien on substantially all of our assets and the assets of our guarantors. Certain covenants under the Term Loan A Credit Agreement will terminate or be amended, and all guarantees and liens securing the facility will be released, upon the Company’s achievement of investment grade ratings from at least two rating agencies.
Current report
As of June 30, 2026, we were in compliance with the Term Loan A Facility’s financial covenants. The interest rate on our Term Loan A Facility was approximately 4.87% as of June 30, 2026.
Current report
Term Loan B Facility
Current report
The 2026 Term Loan B Facility bears interest at a rate per annum equal to, at the Company’s option, either ABR or Term SOFR plus (i) in the case of ABR loans, 0.50% or, (ii) in the case of Term SOFR loans, 1.50%, which, after November 29, 2026, shall be reduced by 0.125% upon achievement of a leverage ratio defined in the Amended Term Loan B Credit Agreement.
Current report
The 2026 Term Loan B Facility includes customary prepayment requirements, representations and warranties, events of default, reporting and other affirmative and negative covenants, including limitations on indebtedness, liens, investments, dividends, repayments of junior financings and asset sales, subject to customary exceptions.
Current report
The interest rate on our 2026 Term Loan B Facility was approximately 5.12% as of June 30, 2026.
Removed paragraphs (4)
Previous report
Debt extinguishment loss was not material for the first quarter of 2026, compared with $5 million for the same quarter in 2025, which related to the refinancing of our term loan facility.
Previous report
Adjusted EBITDA was $33 million for the first quarter of 2026, compared with $32 million for the same quarter in 2025.
Previous report
Term Loan Facility
Previous report
The weighted average interest rate of our term loans was approximately 5.42% as of March 31, 2026.
Reworded paragraphs (38)
Previous wording
XPO, Inc., together with its subsidiaries (“XPO,” “we” or the “Company”), is a leading provider of freight transportation services, with company-specific avenues for value creation. We use our proprietary technology to move goods efficiently through our customers’ supply chains in North America and Europe. As of March 31, 2026, we had approximately 37,000 employees serving approximately 55,000 customers through 594 locations in 17 countries.
Current wording
XPO, Inc., together with its subsidiaries (“XPO,” “we” or the “Company”), is a leading provider of freight transportation services, with company-specific avenues for value creation. We use our proprietary technology to move goods efficiently through our customers’ supply chains in North America and Europe. As of June 30, 2026, we had approximately 38,000 employees serving approximately 55,000 customers through 586 owned and leased locations in 17 countries.
Previous wording
LTL in North America is a bedrock industry providing a critical service to the economy, with secular growth drivers, a favorable pricing environment and an established competitive landscape. XPO is one of the largest LTL networks in North America, with approximately 9% share of the U.S. market, estimated to be $52 billion in 2025.
Current wording
LTL in North America is a bedrock industry providing a critical service to the economy, with secular growth drivers, a favorable pricing environment and an established competitive landscape. XPO operates one of the largest LTL networks in North America, with approximately 9% share of the U.S. market, estimated to be $52 billion in 2025.
Previous wording
Our network serves approximately 37,000 shippers with critical geographic density and day-definite domestic services to approximately 99% of U.S. ZIP codes, as well as cross-border services to Mexico, Canada and the Caribbean. We operate the business to high service standards for on-time delivery and damage-free transport, while balancing our network to leverage our fixed costs. In 2025, we developed new linehaul models that use artificial intelligence (AI) to improve the efficiency of our freight flows, piloted routing innovations for pickup-and-delivery operations and continued to improve productivity with real-time labor analytics at the service center level. Our proprietary developments in intelligent automation and AI-enabled decision-making are directly enhancing profitability.
Current wording
Our network serves approximately 38,000 shippers with critical geographic density and day-definite domestic services to approximately 99% of U.S. ZIP codes, as well as cross-border services to Mexico, Canada and the Caribbean. We operate the business to high service standards for on-time delivery and damage-free transport, while balancing our network to leverage our fixed costs. In 2025, we developed new linehaul models that use artificial intelligence (AI) to improve the efficiency of our freight flows, piloted routing innovations for pickup-and-delivery operations and continued to improve productivity with real-time labor analytics at the service center level. Our proprietary developments in intelligent automation and AI-enabled decision-making are directly enhancing profitability.
Previous wording
This positions us to capture profitable market share gains and drive higher incremental margins when market conditions improve. LTL industry capacity is currently constrained below pre-pandemic levels in North America, and we believe that our combination of capacity and technology puts us in a unique position to respond quickly to rebounds in demand when the freight recession eases.
Current wording
This positions us to capture profitable market share gains and drive higher incremental margins as market conditions improve. LTL industry capacity is currently constrained below pre-pandemic levels in North America, and we believe that our combination of capacity and technology puts us in a unique position to respond quickly to rebounds in demand as the freight recession eases.
Previous wording
An LTL network of our scale has hundreds of thousands of activities underway at any given time, all managed on our technology. For the trailing 12 months ended March 31, 2026, we moved approximately 16 billion pounds of freight 775 million miles, including moving linehaul freight an average of 2.5 million miles a day.
Current wording
An LTL network of our scale has hundreds of thousands of activities underway at any given time, all managed on our technology. For the trailing 12 months ended June 30, 2026, we moved approximately 16 billion pounds of freight 784 million miles, including moving linehaul freight an average of 2.5 million miles a day.
Previous wording
With intelligent route-building, we can reduce empty miles in our linehaul network and improve load factor. Our proprietary optimization models analyze massive amounts of data including volume, capacity, and dimensions and generate instructions to maximize trailer utilization, reduce cost, and enhance service. We use our real-time visualization tools to drive efficiencies with pickups and deliveries and developed a robust pricing platform for contractual account management.
Current wording
With intelligent route-building, we can reduce empty miles in our linehaul network and improve load factor. Our proprietary optimization models analyze massive amounts of data including volume, capacity, and dimensions and generate instructions to maximize trailer utilization, reduce cost, and enhance service. We use our real-time visualization tools to drive efficiencies with pickups and deliveries and a robust pricing platform for contractual account management.
Previous wording
Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025
Current wording
Three and Six Months Ended June 30, 2026 Compared with Three and Six Months Ended June 30, 2025
Previous wording
Our consolidated revenue for the first quarter of 2026 increased 7.3% to $2.1 billion, compared with the same quarter in 2025. Foreign currency movement increased revenue by approximately 4.4 percentage points in the first quarter of 2026. The increase in revenue during the first quarter of 2026 compared to the same period in 2025, after taking into effect the impact of foreign currency movements, primarily reflects higher revenue in our North American LTL segment, driven by higher yield and shipments per day and higher fuel surcharge revenue.
Current wording
Our consolidated revenue for the second quarter of 2026 increased 13.2% to $2.4 billion, compared with the same quarter in 2025. Our consolidated revenue for the first six months of 2026 increased 10.3% to $4.5 billion, compared with the same period in 2025. Foreign currency movement increased revenue by approximately 1.0 percentage point in the second quarter of 2026 and by approximately 2.6 percentage points in the first six months of 2026. The increase in revenue during the second quarter of 2026 and the first six months of 2026 compared to the same periods in 2025, after taking into effect the impact of foreign currency movements, primarily reflects higher revenue in both our North American LTL and European Transportation segments, further explained below, and includes the impact of higher revenue from fuel surcharges.
Previous wording
Salaries, wages and employee benefits includes compensation-related costs for our employees, including salaries, wages, incentive compensation, healthcare-related costs and payroll taxes, and covers drivers and dockworkers, operations and facility workers and employees in support roles and other positions. Salaries, wages and employee benefits for the first quarter of 2026 was $880 million, or 42.0% of revenue, compared with $832 million, or 42.6% of revenue, for the same quarter in 2025. The year-over-year decrease as a percentage of revenue primarily reflects productivity improvements enabled by our AI-driven optimization tools, partially offset by higher costs due to the insourcing of a greater proportion of linehaul from third-party transportation providers in our North American LTL segment and wage inflation.
Current wording
Salaries, wages and employee benefits includes compensation-related costs for our employees, including salaries, wages, incentive compensation, healthcare-related costs and payroll taxes, and covers drivers and dockworkers, operations and facility workers and employees in support roles and other positions. Salaries, wages and employee benefits for the second quarter of 2026 was $929 million, or 39.4% of revenue, compared with $871 million, or 41.9% of revenue, for the same quarter in 2025. Salaries, wages and employee benefits for the first six months of 2026 was $1.8 billion, or 40.6% of revenue, compared with $1.7 billion, or 42.2% of revenue, for the same period in 2025. The year-over-year increase in both periods primarily reflects wage inflation, higher volumes and higher incentive compensation, partially offset by productivity improvements enabled by our AI-driven optimization tools. As a percentage of revenue, the year-over-year decrease reflects leveraging compensation costs across a larger revenue base.
Previous wording
Purchased transportation includes costs of procuring third-party freight transportation. Purchased transportation for the first quarter of 2026 was $423 million, or 20.2% of revenue, compared with $399 million, or 20.4% of revenue, for the same quarter in 2025. The year-over-year decrease as a percentage of revenue primarily reflects the insourcing of a greater proportion of linehaul from third-party transportation providers in our North American LTL segment.
Current wording
Purchased transportation includes costs of procuring third-party freight transportation. Purchased transportation for the second quarter of 2026 was $464 million, or 19.7% of revenue, compared with $426 million, or 20.5% of revenue, for the same quarter in 2025. Purchased transportation for the first six months of 2026 was $887 million, or 19.9% of revenue, compared with $826 million, or 20.5% of revenue, for the same period in 2025. The year-over-year increase in both periods primarily reflects higher prices for purchased transportation, driven in part by higher fuel prices, partially offset by the insourcing of a greater proportion of linehaul from third-party transportation providers in our North American LTL segment. As a percentage of revenue, the year-over-year decrease reflects proportionally higher revenue growth.
Previous wording
Fuel, operating expenses and supplies includes the cost of fuel purchased for use in our vehicles as well as related taxes, maintenance and lease costs for our equipment, including tractors and trailers, costs related to operating our owned and leased facilities, bad debt expense, third-party professional fees, information technology expenses and supplies expense. Fuel, operating expenses and supplies for the first quarter of 2026 was $423 million, or 20.2% of revenue, compared with $393 million, or 20.1% of revenue, for the same quarter in 2025. The year-over-year increase as a percentage of revenue primarily reflects higher fuel costs and higher weather-related costs in our North American LTL segment, partially offset by lower maintenance costs in our North American LTL segment.
Current wording
Fuel, operating expenses and supplies includes the cost of fuel purchased for use in our vehicles as well as related taxes, maintenance and lease costs for our equipment, including tractors and trailers, costs related to operating our owned and leased facilities, bad debt expense, third-party professional fees, information technology expenses and supplies expense. Fuel, operating expenses and supplies for the second quarter of 2026 was $476 million, or 20.2% of revenue, compared with $384 million, or 18.5% of revenue, for the same quarter in 2025. Fuel, operating expenses and supplies for the first six months of 2026 was $899 million, or 20.2% of revenue, compared with $777 million, or 19.3% of revenue, for the same period in 2025. As a percentage of revenue, the year-over-year increase in both periods primarily reflects higher fuel costs.
Previous wording
Operating taxes and licenses includes tax expenses related to our vehicles and our owned and leased facilities as well as license expenses to operate our vehicles. Operating taxes and licenses for the first quarter of 2026 was $21 million, compared with $19 million for the same period in 2025.
Current wording
Operating taxes and licenses includes tax expenses related to our vehicles and our owned and leased facilities as well as license expenses to operate our vehicles. Operating taxes and licenses for the second quarter of 2026 was $22 million, compared with $21 million for the same period in 2025. Operating taxes and licenses for the first six months of 2026 was $43 million, compared with $40 million for the same period in 2025.
Previous wording
Insurance and claims includes costs related to vehicular and cargo claims for both purchased insurance and self-insurance programs. Insurance and claims for the first quarter of 2026 was $34 million, compared with $35 million for the same quarter in 2025.
Current wording
Insurance and claims includes costs related to vehicular and cargo claims for both purchased insurance and self-insurance programs. Insurance and claims for the second quarter of 2026 was $40 million, compared with $40 million for the same quarter in 2025. Insurance and claims for the first six months of 2026 was $75 million, compared with $75 million for the same period in 2025.
Previous wording
Depreciation and amortization expense for the first quarter of 2026 was $131 million, compared with $123 million for the same quarter in 2025. The year-over-year increase primarily reflects the impact of capital investments in property, tractors and trailers in our North American LTL segment.
Current wording
Depreciation and amortization expense for the second quarter of 2026 was $134 million, compared with $131 million for the same quarter in 2025. Depreciation and amortization expense for the first six months of 2026 was $265 million, compared with $254 million for the same period in 2025. The year-over-year increase primarily reflects the impact of capital investments in property, tractors and trailers in our North American LTL segment.
Previous wording
Legal matters for the first quarter of 2025 was a gain of $11 million, which reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to our acquisition of Norbert Dentressangle SA in 2015. There was no comparable gain or loss in the first quarter of 2026.
Current wording
Legal matters for the second quarter of 2025 and the first six months of 2025 was a gain of $2 million and $13 million, respectively, which reflects the settlement of claims against certain truck manufacturers related to purchases by our European Transportation segment covering periods prior to our acquisition of Norbert Dentressangle SA in 2015. There was no comparable gain or loss in the first six months of 2026.
Previous wording
Transaction and integration costs for the first quarter of 2026 were $2 million, compared with $3 million for the same quarter in 2025.
Current wording
Transaction and integration costs for the second quarter of 2026 were $2 million, compared with $3 million for the same quarter in 2025. Transaction and integration costs for the first six months of 2026 were $4 million, compared with $6 million for the same period in 2025.
Previous wording
Restructuring costs for the first quarter of 2026 were $9 million, compared with $12 million for the same quarter in 2025, which primarily related to restructuring actions in our European Transportation segment. We engage in restructuring actions as part of our ongoing efforts to best use our resources and infrastructure. For more information, see Note 4—Restructuring Charges to our Condensed Consolidated Financial Statements.
Current wording
Restructuring costs for the second quarter of 2026 were $22 million, compared with $8 million for the same quarter in 2025. Restructuring costs for the first six months of 2026 were $31 million, compared with $20 million for the same period in 2025. Restructuring costs in both periods primarily related to restructuring actions in our European Transportation segment. We engage in restructuring actions as part of our ongoing efforts to best use our resources and infrastructure. For more information, see Note 4—Restructuring Charges to our Condensed Consolidated Financial Statements.
Previous wording
Other income for the first quarter of 2026 was $3 million, compared with $1 million for the same quarter in 2025. The year-over-year increase primarily reflects a $2 million increase in net periodic pension income.
Current wording
Other income for the second quarter of 2026 was $4 million, compared with $2 million for the same quarter in 2025. Other income for the first six months of 2026 was $7 million, compared with $3 million for the same period in 2025. The year-over-year increase in both periods primarily reflects an increase in net periodic pension income.
Previous wording
Interest expense decreased to $53 million for the first quarter of 2026, compared with $56 million for the same quarter in 2025. The year-over-year decrease is primarily due to a lower average debt balance as well as lower interest rates on our variable rate debt.
Current wording
Interest expense decreased to $51 million for the second quarter of 2026, compared with $56 million for the same quarter in 2025. Interest expense decreased to $104 million for the first six months of 2026, compared with $112 million for the same period in 2025. The year-over-year decrease is primarily due to the repayment of debt as well as lower interest rates on our variable rate debt.
Previous wording
Our effective income tax rates were 18.4% and 24.2% for the first quarters of 2026 and 2025, respectively. The effective income tax rates for the first quarter of 2026 and 2025 were based on forecasted full-year effective income tax rates, adjusted for discrete items that occurred within the periods presented. The decrease in our effective income tax rate for the first quarter of 2026 compared to the same period in 2025 was primarily driven by an increase in a discrete tax benefit from stock-based compensation and a change in estimate related to the discrete benefit associated with a legal entity reorganization in our European Transportation business that occurred in 2024. In the first quarter of 2026, the effective tax rate was impacted by discrete tax benefits of $11 million in the aggregate related to stock-based compensation and a change in estimate associated with the legal entity reorganization. In the first quarter of 2025, the effective tax rate was impacted by losses for which no tax benefit can be recognized and forecasted non-deductible executive compensation expense, partially offset by a discrete tax benefit of $5 million from stock-based compensation.
Current wording
The decrease in our effective income tax rate for the first six months of 2026 compared to the same period in 2025 was primarily driven by an increase in a discrete tax benefit from stock-based compensation and a change in estimate related to the discrete benefit associated with a legal entity reorganization in our European Transportation business that occurred in 2024, partially offset by losses for which no tax benefit can be recognized. The primary items impacting the effective tax rate for the first six months of 2026 were losses for which no tax benefit can be recognized and forecasted non-deductible executive compensation partially offset by a discrete tax benefit from stock-based compensation.
Previous wording
Revenue in our North American LTL segment increased 4.9% to $1.23 billion for the first quarter of 2026, compared with $1.17 billion for the same quarter in 2025. Revenue included fuel surcharge revenue of $201 million and $178 million, respectively, for the first quarters of 2026 and 2025. The increase in fuel surcharge revenue was primarily driven by higher diesel prices.
Current wording
Revenue in our North American LTL segment increased 15.2% to $1.4 billion for the second quarter of 2026, compared with $1.2 billion for the same quarter in 2025. Revenue in our North American LTL segment increased 10.2% to $2.7 billion for the first six months of 2026, compared with $2.4 billion for the same period in 2025. Revenue included fuel surcharge revenue of $314 million and $183 million, respectively, for the second quarters of 2026 and 2025, and $515 million and $361 million, respectively, for the first six months of 2026 and 2025. The increase in fuel surcharge revenue was primarily driven by higher diesel prices.
Previous wording
The year-over-year increase in revenue, excluding fuel surcharge revenue, for the first quarter of 2026 reflects higher yield, primarily related to our improvements in service quality and the benefit of numerous pricing initiatives. The increase in tonnage per day for the first quarter of 2026 reflects higher shipments per day partially offset by lower average weight per shipment.
Current wording
The year-over-year increase in revenue, excluding fuel surcharge revenue, for both the second quarter and first six months of 2026 reflects higher yield, primarily related to our improvements in service quality and the benefit of numerous pricing initiatives, and higher tonnage. The increase in tonnage for both the second quarter and first six months of 2026 reflects higher shipments per day partially offset by lower average weight per shipment.
Previous wording
Adjusted EBITDA was $290 million for the first quarter of 2026, compared with $250 million for the same quarter in 2025. The increase in adjusted EBITDA reflects higher yield and shipments per day, higher fuel surcharge revenue, productivity improvements, lower purchased transportation, and lower vehicular insurance costs, partially offset by lower average weight per shipment, higher fuel costs and wage inflation.
Current wording
Adjusted EBITDA was $390 million for the second quarter of 2026, compared with $300 million for the same quarter in 2025. Adjusted EBITDA was $680 million for the first six months of 2026, compared with $550 million for the same period in 2025. The increase in adjusted EBITDA reflects higher yield, shipments per day and fuel surcharge revenue, as well as productivity improvements, partially offset by lower average weight per shipment, higher fuel costs and wage inflation.
Previous wording
Depreciation and amortization expense increased to $97 million in the first quarter of 2026 compared with $90 million for the same quarter in 2025, primarily due to the impact of capital investments in property, tractors and trailers.
Current wording
Depreciation and amortization expense increased to $100 million in the second quarter of 2026 compared with $96 million for the same quarter in 2025. Depreciation and amortization expense increased to $197 million in the first six months of 2026 compared with $185 million for the same period in 2025. The year-over-year increase was primarily due to the impact of capital investments in property, tractors and trailers.
Previous wording
Revenue in our European Transportation segment increased 11.0% to $868 million for the first quarter of 2026, compared with $782 million for the same quarter in 2025. Foreign currency movement increased revenue by approximately 10.9 percentage points in the first quarter of 2026. After taking into effect the impact of foreign currency movement, revenue was essentially flat in the first quarter of 2026 compared to the same period in 2025.
Current wording
Revenue in our European Transportation segment increased 10.2% to $927 million for the second quarter of 2026, compared with $841 million for the same quarter in 2025. Revenue increased 10.6% to $1.8 billion for the first six months of 2026, compared with $1.6 billion for the same period in 2025. Foreign currency movement increased revenue by approximately 2.4 percentage points in the second quarter of 2026 and by approximately 6.4 percentage points in the first six months of 2026. The increase in revenue reflects improved pricing, the impact of foreign currency movements and higher fuel revenue.
Previous wording
Depreciation and amortization expense increased to $33 million in the first quarter of 2026, compared with $32 million for the same quarter in 2025.
Current wording
Depreciation and amortization expense decreased to $33 million in the second quarter of 2026, compared with $34 million for the same quarter in 2025. Depreciation and amortization expense decreased to $66 million in the first six months of 2026, compared with $67 million for the same period in 2025.
Previous wording
Our cash and cash equivalents balance was $237 million as of March 31, 2026, compared to $310 million as of December 31, 2025. Our principal existing sources of cash are: (i) cash generated from operations; (ii) borrowings available under our Revolving Credit Facility (as defined below); and (iii) proceeds from the issuance of other debt. As of March 31, 2026, we have approximately $600 million available to draw under our Revolving Credit Facility, after considering outstanding letters of credit of less than $1 million. Additionally, we have a $200 million uncommitted secured evergreen letter of credit facility, under which we had issued $132 million in aggregate face amount of letters of credit as of March 31, 2026.
Current wording
Our cash and cash equivalents balance was $298 million as of June 30, 2026, compared to $310 million as of December 31, 2025. Our principal existing sources of cash are: (i) cash generated from operations; (ii) borrowings available under our Revolving Credit Facility (as defined below); and (iii) proceeds from the issuance of other debt. As of June 30, 2026, we have approximately $600 million available to draw under our Revolving Credit Facility, after considering outstanding letters of credit of less than $1 million. Additionally, we have a $200 million uncommitted secured evergreen letter of credit facility, under which we had issued $131 million in aggregate face amount of letters of credit as of June 30, 2026.
Previous wording
As of March 31, 2026, we had approximately $837 million of total liquidity. We continually evaluate our liquidity requirements in light of our operating needs, growth initiatives and capital resources. We believe that our existing liquidity and sources of capital are sufficient to support our operations over the next 12 months.
Current wording
As of June 30, 2026, total liquidity, comprised of cash and cash equivalents and availability under the Revolving Credit Facility, was approximately $898 million. We continually evaluate our liquidity requirements in light of our operating needs, growth initiatives and capital resources. We believe that our existing liquidity and sources of capital are sufficient to support our operations over the next 12 months and for the foreseeable future thereafter.
Previous wording
The maximum amount of net cash proceeds available at any one time under our securitization program, inclusive of any unsecured borrowings, is €200 million (approximately $231 million as of March 31, 2026). As of March 31, 2026, less than €1 million (less than $1 million) was available under the program. Under the securitization program, we service the receivables we sell on behalf of the purchasers. In January 2026, the program was amended to extend the maturity date through March 2029.
Current wording
The maximum amount of net cash proceeds available at any one time under our securitization program, inclusive of any unsecured borrowings, is €200 million (approximately $228 million as of June 30, 2026). As of June 30, 2026, the maximum amount available under the program was utilized. Under the securitization program, we service the receivables we sell on behalf of the purchasers. In January 2026, the program was amended to extend the maturity date through March 2029.
Previous wording
In February 2025, we amended our Senior Secured Term Loan Credit Agreement (“Amended Term Loan Credit Agreement”). Pursuant to the amendment, the lenders provided the company (a) a term loan B facility in an aggregate principal amount of $700 million, maturing on May 24, 2028 (the “Refinancing Term Loan B-2 Facility”), and (b) a term loan B facility in an aggregate principal amount of $400 million, maturing on February 1, 2031 (the “Refinancing Term Loan B-3 Facility” and together with the Refinancing Term Loan B-2 Facility, the “Refinancing Term Loan Facilities”). The proceeds of the Refinancing Term Loan Facilities were used to refinance our existing term loans. We recorded a debt extinguishment loss of $5 million in the first quarter of 2025 due to this refinancing. Subsequently, in the second half of 2025, we used cash on hand to repay $115 million of outstanding principal under the Refinancing Term Loan B-2 Facility, which was scheduled to mature in 2028.
Current wording
In May 2026, we amended our Senior Secured Term Loan Credit Agreement (“Amended Term Loan B Credit Agreement”). Pursuant to the amendment, the lenders provided the Company a new tranche of Term B-4 loans in an initial aggregate principal amount of $385 million, maturing on February 1, 2031 (the “2026 Term Loan B Facility”). The proceeds from the 2026 Term Loan B Facility, together with the proceeds from the Term Loan A Facility, were used to repay $885 million of outstanding principal, representing all outstanding indebtedness under our existing term loan B credit agreement. During the first half of 2026, prior to the refinancing, we used cash on hand to repay $100 million of outstanding principal under the existing term loan B credit agreement. We recorded a debt extinguishment loss of $5 million during the six months ended June 30, 2026, primarily related to the refinancing, and a debt extinguishment loss of $5 million during the six months ended June 30, 2025 related to the refinancing of our term loans in February 2025.
Previous wording
During the quarter ended March 31, 2026, we used cash on hand to repay $30 million of outstanding principal under this loan. In April 2026, we used cash on hand to repay an additional $70 million of outstanding principal under this loan, including $45 million classified within Short-term borrowings and current maturities of long-term debt as of March 31, 2026. The debt extinguishment losses recorded in connection with the repayments were not material.
Current wording
In July 2026, we used cash on hand to repay $100 million of outstanding principal under the 2026 Term Loan B Facility, which was classified within Short-term borrowings and current maturities of long-term debt as of June 30, 2026. The debt extinguishment loss recorded in connection with the repayment was not material. Including the July repayment, we used cash on hand to repay $200 million of outstanding principal under our term loans on a cumulative basis year to date.
Previous wording
In the first quarter of 2026, we repurchased 156 thousand shares of common stock with an aggregate value of $30 million at an average price of $192.19 per share. The share repurchases were funded by cash on hand. There were no share repurchases during the first quarter of 2025. As of March 31, 2026, our remaining share repurchase authorization was $595 million, reflecting $155 million of cumulative repurchases to date under the program.
Current wording
In the second quarter of 2026, we repurchased 341 thousand shares of common stock with an aggregate value of $70 million at an average price of $205.22 per share. In the first six months of 2026, we repurchased 497 thousand shares of common stock with an aggregate value of $100 million at an average price of $201.13 per share. The share repurchases were funded by cash on hand. In the second quarter and first six months of 2025, we repurchased 83 thousand shares of common stock with an aggregate value of $10 million at an average price of $120.41 per share. As of June 30, 2026, our remaining share repurchase authorization was $525 million, reflecting $225 million of cumulative repurchases to date under the program.
Previous wording
During the three months ended March 31, 2026, we generated cash from operating activities of $183 million. We used cash during the period primarily to: (i) purchase property and equipment of $111 million; (ii) make net payments of $88 million related to tax withholding obligations in connection with the vesting of stock compensation awards; (iii) repurchase common stock of $30 million; and (iv) repay $30 million of outstanding principal under the Refinancing Term Loan B-2 Facility.
Current wording
During the six months ended June 30, 2026, we (i) generated cash from operating activities of $491 million and (ii) received proceeds of $885 million from the issuance of the Term Loan A Facility and the 2026 Term Loan B Facility. We used cash during the period primarily to: (i) repay $985 million of outstanding principal under our existing term loan B credit agreement; (ii) purchase property and equipment of $238 million; (iii) repurchase common stock of $100 million; (iv) make net payments of $88 million related to tax withholding obligations in connection with the vesting of stock compensation awards; and (v) repay $39 million of finance leases and other debt.
Previous wording
During the three months ended March 31, 2025, we generated cash from operating activities of $142 million. We used cash during this period primarily to: (i) purchase property and equipment of $199 million and (ii) make net payments of $47 million related to tax withholding obligations in connection with the vesting of stock compensation awards.
Current wording
During the six months ended June 30, 2025, we generated cash from operating activities of $389 million. We used cash during this period primarily to: (i) purchase property and equipment of $395 million; (ii) make net payments of $48 million related to tax withholding obligations in connection with the vesting of stock compensation awards; and (iii) repay $36 million of finance leases and other debt.
Previous wording
Cash flows from operating activities for the three months ended March 31, 2026 increased by $41 million, compared with the same period in 2025. The increase primarily reflects higher net income of $32 million in the first three months of 2026, compared with the same period in 2025.
Current wording
Cash flows from operating activities for the six months ended June 30, 2026 increased by $102 million, compared with the same period in 2025. The increase primarily reflects higher net income of $88 million in the first six months of 2026, compared with the same period in 2025.
Previous wording
Investing activities used $107 million of cash in the three months ended March 31, 2026 and $191 million of cash in the three months ended March 31, 2025. During the three months ended March 31, 2026, we used $111 million to purchase property and equipment, as compared to a $199 million usage of cash in the same period in 2025. The decrease is due to planned reductions in capital expenditures in 2026 compared to 2025.
Current wording
Investing activities used $208 million of cash in the six months ended June 30, 2026 and $382 million of cash in the six months ended June 30, 2025. During the six months ended June 30, 2026, we used $238 million to purchase property and equipment, as compared to a $395 million usage of cash in the same period in 2025. The decrease is due to planned reductions in capital expenditures in 2026 compared to 2025.
Previous wording
Financing activities used $147 million of cash in the three months ended March 31, 2026 and $30 million of cash in the three months ended March 31, 2025. The primary uses of cash from financing activities during the first three months of 2026 were $88 million to make net payments for tax withholdings on vested stock compensation awards, $30 million to repurchase common stock, $30 million to repay outstanding principal under the Refinancing Term Loan B-2 Facility, which was scheduled to mature in 2028, and $20 million used to repay borrowings, primarily related to finance lease obligations. The primary uses of cash from financing activities during the first three months of 2025 were $47 million to make net payments for tax withholdings on vested stock compensation awards and $18 million used to repay borrowings, primarily related to finance lease obligations. The primary source of cash from financing activities during the first three months of 2026 was $20 million of proceeds from bank overdrafts, compared to $38 million in the same period of 2025.
Current wording
Financing activities used $300 million of cash in the six months ended June 30, 2026 and $74 million of cash in the six months ended June 30, 2025. The primary uses of cash from financing activities during the first six months of 2026 were $985 million to repay outstanding principal under our existing term loan B credit agreement, $100 million to repurchase common stock, $88 million to make net payments for tax withholdings on vested stock compensation awards, primarily during the first quarter of 2026, and $39 million to repay finance leases and other debt. The primary uses of cash from financing activities during the first six months of 2025 were $48 million to make net payments for tax withholdings on vested stock compensation awards, primarily during the first quarter of 2025, and $36 million to repay finance leases and other debt. The primary source of cash from financing activities during the first six months of 2026 was $885 million of proceeds from the issuance of the Term Loan A Facility and the 2026 Term Loan B Facility and $26 million of proceeds from bank overdrafts, compared to $22 million of proceeds from bank overdrafts in the same period of 2025.
Previous wording
There were no material changes to our December 31, 2025 contractual obligations during the three months ended March 31, 2026. We anticipate full year gross capital expenditures to be between $500 million and $600 million in 2026, funded by cash on hand, cash generated from operations and available liquidity.
Current wording
Except as set forth above under Term Loan A Facility and Term Loan B Facility, there were no material changes to our December 31, 2025 contractual obligations during the six months ended June 30, 2026. We anticipate full year gross capital expenditures to be between $500 million and $600 million in 2026, funded by cash on hand, cash generated from operations and available liquidity.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Our effective income tax rates were 25.8% and 25.9% for the second quarters of 2026 and 2025, respectively, and 23.1% and 25.3% for the first six months of 2026 and 2025, respectively. The effective income tax rates for the second quarter and six-month periods of 2026 and 2025 were based on forecasted full-year effective income tax rates, adjusted for discrete items that occurred within the periods presented.
Current report — wording carried from elsewhere
The effective tax rate for the second quarter of 2026 was consistent with the second quarter of 2025, remaining essentially flat year over year. The primary items impacting the effective tax rate for the second quarter of 2026 were losses for which no tax benefit can be recognized and forecasted non-deductible executive compensation.