QXO, Inc.

Previous wording

Three and Six Months Ended June 30, 2025 Compared with Three and Six Months Ended June 30, 2024

Current wording

Three and Nine Months Ended September 30, 2025 Compared with Three and Nine Months Ended September 30, 2024

Previous wording

Net sales for the six months ended June 30, 2025 increased to $1.92 billion compared to $29.0 million for the six months ended June 30, 2024. The increase in net sales was primarily driven by the Beacon Acquisition as Beacon’s net sales for the period April 29, 2025 through June 30, 2025 are included in net sales for the six months ended June 30, 2025.

Current wording

Net sales for the three months ended September 30, 2025 increased to $2.73 billion compared to $13.1 million for the three months ended September 30, 2024. The increase in net sales was primarily driven by the Beacon Acquisition as Beacon’s net sales are included in net sales for the three months ended September 30, 2025.

Previous wording

Net sales for the three months ended June 30, 2025 increased to $1.91 billion compared to $14.5 million for the three months ended June 30, 2024. The increase in net sales was primarily driven by the Beacon Acquisition as Beacon’s net sales for the period April 29, 2025 through June 30, 2025 are included in net sales for the three months ended June 30, 2025.

Current wording

Net sales for the nine months ended September 30, 2025 increased to $4.65 billion compared to $42.1 million for the nine months ended September 30, 2024. The increase in net sales was primarily driven by the Beacon Acquisition as Beacon’s net sales for the period April 29, 2025 through September 30, 2025 are included in net sales for the nine months ended September 30, 2025.

Previous wording

Cost of products sold for the three months ended June 30, 2025 increased to $1.50 billion, up from $8.7 million for the three months ended June 30, 2024. The increase in cost of products sold was primarily due to higher net sales as a result of the Beacon Acquisition. Cost of products sold was also negatively impacted by the inventory fair value adjustments as a result of recording Beacon’s inventory at fair value on the acquisition date.

Current wording

Cost of products sold for the three months ended September 30, 2025 increased to $2.09 billion, up from $7.6 million for the three months ended September 30, 2024. The comparative increase was primarily due to higher cost of products sold associated with increased net sales as a result of the Beacon Acquisition. Cost of products sold was also negatively impacted by the inventory fair value adjustments as a result of recording Beacon’s inventory at fair value on the acquisition date.

Previous wording

Cost of products sold for the six months ended June 30, 2025 increased to $1.51 billion, up from $17.5 million for the six months ended June 30, 2024. The increase in cost of products sold was primarily due to higher net sales as a result of the Beacon Acquisition. Cost of products sold was also negatively impacted by the inventory fair value adjustments as a result of recording Beacon’s inventory at fair value on the acquisition date.

Current wording

Cost of products sold for the nine months ended September 30, 2025 increased to $3.61 billion, up from $25.1 million for the nine months ended September 30, 2024. The comparative increase was primarily due to higher cost of products sold associated with increased net sales as a result of the Beacon Acquisition. Cost of products sold was also negatively impacted by the inventory fair value adjustments as a result of recording Beacon’s inventory at fair value on the acquisition date.

Previous wording

Selling, General and Administrative (“SG&A”)

Current wording

Selling, General and Administrative (“SG&A”) Expense

Previous wording

SG&A expense for the six months ended June 30, 2025 increased to $501.2 million, up from $15.0 million for the six months ended June 30, 2024. The increase in SG&A expense was primarily driven by costs incurred to support the ongoing operations of our business subsequent to the Beacon Acquisition as well as acquisition-related transaction costs of $75.5 million and stock-based compensation expense of $85.2 million.

Current wording

SG&A expense for the three months ended September 30, 2025 increased to $452.5 million, up from $39.0 million for the three months ended September 30, 2024. The increase in SG&A expense was primarily driven by costs incurred to support the ongoing operations of our business subsequent to the Beacon Acquisition as well as incremental costs of $23.2 million related to our transformation efforts, which are directed at simplifying, streamlining, and optimizing the Company’s operations. The increase in SG&A expense was also attributable to an increase in stock-based compensation expense of $17.1 million.

Previous wording

SG&A expense for the three months ended June 30, 2025 increased to $456.8 million, up from $9.8 million for the three months ended June 30, 2024. The increase in SG&A expense was primarily driven by costs incurred to support the ongoing operations of our business subsequent to the Beacon Acquisition as well as acquisition-related transaction costs of $65.6 million and stock-based compensation expense of $65.0 million.

Current wording

SG&A expense for the nine months ended September 30, 2025 increased to $953.7 million, up from $54.0 million for the nine months ended September 30, 2024. The increase in SG&A expense was primarily driven by costs incurred to support the ongoing operations of our business subsequent to the Beacon Acquisition as well as increases in stock-based compensation expense of $102.3 million, acquisition-related transaction costs of $71.7 million and restructuring charges of $39.7 million.

Previous wording

Depreciation expense was $27.2 million for the three months ended June 30, 2025, compared to $0.1 million for the three months ended June 30, 2024. The comparative increase was primarily due to an increase in property and equipment as a result of the Beacon Acquisition.

Current wording

Depreciation expense was $39.7 million for the three months ended September 30, 2025, compared to a de minimis amount of depreciation expense for the three months ended September 30, 2024. The comparative increase was primarily due to an increase in property and equipment as a result of the Beacon Acquisition.

Previous wording

Depreciation expense was $27.3 million for the six months ended June 30, 2025, compared to $0.2 million for the six months ended June 30, 2024. The comparative increase was primarily due to an increase in property and equipment as a result of the Beacon Acquisition.

Current wording

Depreciation expense was $67.0 million for the nine months ended September 30, 2025, compared to $0.2 million for the nine months ended September 30, 2024. The comparative increase was primarily due to an increase in property and equipment as a result of the Beacon Acquisition.

Previous wording

Amortization expense was $79.8 million for the three months ended June 30, 2025, compared to $0.2 million for the three months ended June 30, 2024. The comparative increase was primarily due to amortization expense associated with new customer relationships and trade names intangible assets recognized as a result of the Beacon Acquisition.

Current wording

Amortization expense was $117.8 million for the three months ended September 30, 2025, compared to $0.2 million for the three months ended September 30, 2024. The comparative increase was primarily due to amortization expense associated with new customer relationships and trade names intangible assets recognized as a result of the Beacon Acquisition.

Previous wording

Amortization expense was $80.0 million for the six months ended June 30, 2025, compared to $0.4 million for the six months ended June 30, 2024. The comparative increase was primarily due to amortization expense associated with new customer relationships and trade names intangible assets recognized as a result of the Beacon Acquisition.

Current wording

Amortization expense was $197.8 million for the nine months ended September 30, 2025, compared to $0.6 million for the nine months ended September 30, 2024. The comparative increase was primarily due to amortization expense associated with new customer relationships and trade names intangible assets recognized as a result of the Beacon Acquisition.

Previous wording

Interest (expense) income, net was $(30.2) million for the three months ended June 30, 2025, compared to $3.5 million for the three months ended June 30, 2024. The comparative increase was primarily due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition, resulting in higher interest expense. The increase in interest expense was partially offset by interest income due to a higher average interest-bearing cash balance during the three months ended June 30, 2025.

Current wording

Interest (expense) income, net was $(37.7) million for the three months ended September 30, 2025, compared to $57.0 million for the three months ended September 30, 2024. The comparative increase in interest expense was primarily due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition, resulting in higher interest expense. The increase was also driven by lower interest income due to a lower average interest-bearing cash balance during the three months ended September 30, 2025.

Previous wording

Interest income, net was $26.4 million for the six months ended June 30, 2025, compared to $3.4 million for the six months ended June 30, 2024. The comparative increase was primarily due to higher interest income as a result of a higher average interest-bearing cash balance during the six months ended June 30, 2025, partially offset by higher interest expense due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition.

Current wording

Interest (expense) income, net was $(11.3) million for the nine months ended September 30, 2025, compared to $60.4 million for the nine months ended September 30, 2024. The comparative increase in interest expense was primarily due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition, resulting in higher interest expense. The increase in interest expense was partially offset by higher interest income due to a higher average interest-bearing cash balance during the nine months ended September 30, 2025.

Previous wording

Loss on debt extinguishment was $45.7 million for the three and six months ended June 30, 2025 due to the principal prepayment of $1.40 billion under the Term Loan Facility and includes the pro-rata extinguishment of previously capitalized original issue discounts and debt issuance costs.

Current wording

Loss on debt extinguishment was $45.7 million for the nine months ended September 30, 2025 due to the principal prepayment of $1.40 billion under the Term Loan Facility and includes the pro-rata extinguishment of previously capitalized original issue discounts and debt issuance costs.

Previous wording

Benefit from income taxes was $177.8 million for the three months ended June 30, 2025, compared to $0.2 million for the three months ended June 30, 2024. The comparative increase in income tax benefit was primarily due to lower pre-tax income coupled with an increase in compensation above $1 million, inclusive of equity awards, paid to covered employees under Internal Revenue Code (“IRC”) Section 162(m) and non-deductible transaction costs due to the Beacon Acquisition. The effective tax rate, excluding discrete items, was 72.7% for the three months ended June 30, 2025, compared to 28.9% for the three months ended June 30, 2024.

Current wording

The Company’s interim provision for income taxes is determined based on its annual estimated effective tax rate, applied to the actual year-to-date income, and adjusted for the tax effects of any discrete items. The Company’s effective tax rate for the nine months ended September 30, 2025, excluding discrete items, was 14.1%, compared to 25.9% for the nine months ended September 30, 2024. The Company’s effective tax rates for the nine months ended September 30, 2025 and 2024 were based on the U.S. federal statutory tax rate of 21% and state jurisdictional income tax rates, adjusted for permanent items including compensation above $1 million, inclusive of equity awards, paid to covered employees under Internal Revenue Code Section 162(m) and non-deductible transaction costs due to the Beacon Acquisition, coupled with the pre-tax loss during the nine months ended September 30, 2025.

Previous wording

The Company’s cash balance was $2.28 billion as of June 30, 2025 and consisted primarily of cash on deposit with banks and investments in money market funds. In addition, we may choose to raise additional funds at any time through equity or debt financing arrangements, which may or may not be needed for additional working capital, acquisitions or other strategic investments. We continually evaluate our liquidity requirements considering our operating needs, growth initiatives and capital resources. Following the Beacon Acquisition, our primary sources of liquidity are cash on the balance sheet, cash generated by operations and borrowings under the ABL Facility. Our primary uses of cash after the Beacon Acquisition are working capital requirements, debt service requirements and capital expenditures. We believe that our existing liquidity and sources of capital are sufficient to support our operations over the next 12 months.

Current wording

The Company’s cash balance was $2.31 billion as of September 30, 2025 and consisted primarily of cash on deposit with banks and investments in money market funds. In addition, we may choose to raise additional funds at any time through equity or debt financing arrangements, which may or may not be needed for additional working capital, acquisitions or other strategic investments. We continually evaluate our liquidity requirements considering our operating needs, growth initiatives and capital resources. Following the Beacon Acquisition, our primary sources of liquidity are cash on the balance sheet, cash generated by operations and borrowings under the ABL Facility. Our primary uses of cash after the Beacon Acquisition are working capital requirements, debt service requirements and capital expenditures. We believe that our existing liquidity and sources of capital are sufficient to support our operations over the next 12 months.

Previous wording

The Company has a quarterly dividend policy in place for its Convertible Preferred Stock, and dividends are paid when declared by the board of directors. During the three and six months ended June 30, 2025, the Company paid $22.5 million and $45.0 million, respectively, of dividends to holders of Convertible Preferred Stock. Subsequent to the close of the quarter ended June 30, 2025, the Company paid $22.5 million of quarterly dividends to holders of Convertible Preferred Stock. These dividends are part of the Company’s ongoing cash obligations and are considered when evaluating overall liquidity needs. For additional information regarding its Convertible Preferred Stock see, Note 6 –Equity of the Notes to Consolidated Financial Statements, in “Item 1 Financial Statements” of this Quarterly Report.

Current wording

The Company has a quarterly dividend policy in place for its Convertible Preferred Stock, and dividends are paid when declared by the board of directors. During the three and nine months ended September 30, 2025, the Company paid $22.5 million and $67.5 million, respectively, of dividends to holders of Convertible Preferred Stock. Subsequent to the close of the quarter ended September 30, 2025, the Company paid $22.5 million of quarterly dividends to holders of Convertible Preferred Stock. These dividends are part of the Company’s ongoing cash obligations and are considered when evaluating overall liquidity needs. For additional information regarding its Convertible Preferred Stock see, Note 6 –Equity in the Notes to Condensed Consolidated Financial Statements, in “Item 1 Financial Statements” of this Quarterly Report.

Previous wording

The Mandatory Convertible Preferred Stock will accumulate dividends (which may be paid in cash or, subject to certain limitations, in shares of common stock or in any combination of cash and common stock) at a rate per annum equal to 5.50% on the liquidation preference of $1,000 per share, payable when, as and if declared by the Company’s board of directors (or an authorized committee thereof), on February 15, May 15, August 15 and November 15 of each year, beginning on August 15, 2025 and ending on, and including, May 15, 2028. Given the requirement to pay dividends in any settlement outcome of the Mandatory Convertible Preferred Stock, the Company accrues dividends whether or not they are formally declared by the Company’s board of directors.

Current wording

The Mandatory Convertible Preferred Stock will accumulate dividends (which may be paid in cash or, subject to certain limitations, in shares of common stock or in any combination of cash and common stock) at a rate per annum equal to 5.50% on the liquidation preference of $1,000 per share, payable when, as and if declared by the Company’s board of directors (or an authorized committee thereof), on February 15, May 15, August 15 and November 15 of each year, beginning on August 15, 2025 and ending on, and including, May 15, 2028. Given the requirement to pay dividends in any settlement outcome of the Mandatory Convertible Preferred Stock, the Company accrues dividends whether or not they are formally declared by the Company’s board of directors. During the three and nine months ended September 30, 2025, the Company paid $6.9 million of dividends to holders of Mandatory Convertible Preferred Stock. These dividends are part of the Company’s ongoing cash obligations and are considered when evaluating overall liquidity needs. For additional information regarding the Company’s Convertible Preferred Stock see, Note 6 –Equity in the Notes to Condensed Consolidated Financial Statements, in “Item 1 Financial Statements” of this Quarterly Report.

Previous wording

In June 2025, the Company sold 89.9 million shares of the Company’s common stock in an underwritten public offering at a price of $22.25 per share. The closing of the equity offering was completed on June 26, 2025 and the Company raised $1.96 billion in net proceeds from the equity offering, after deducting offering costs of $37.6 million. The Company also granted the underwriters in the public offering a 30-day option to purchase up to an additional 13.5 million shares of the Company’s common stock at a price of $22.25 per share less underwriting discounts and commissions. On July 24, 2025, the option was partially exercised with respect to 1.7 million shares resulting in additional net proceeds of $38.2 million. The remaining option to purchase additional shares expired unexercised at the end of the 30-day period.

Current wording

In June 2025, the Company sold 89.9 million shares of the Company’s common stock in an underwritten public offering at a price of $22.25 per share. The closing of the equity offering was completed on June 26, 2025 and the Company raised $1.96 billion in net proceeds from the equity offering, after deducting offering costs of $37.6 million. The Company also granted the underwriters in the public offering a 30-day option to purchase up to an additional 13.5 million shares of the Company’s common stock at a price of $22.25 per share less underwriting discounts and commissions. On July 24, 2025, the option was partially exercised with respect to 1.7 million shares resulting in additional net proceeds of $38.1 million. The remaining option to purchase additional shares expired unexercised at the end of the 30-day period.

Previous wording

As of June 30, 2025, the outstanding balance on the Notes, net of $21.7 million of unamortized debt issuance costs, was $2.23 billion.

Current wording

As of September 30, 2025, the outstanding balance on the Notes, net of $21.1 million of unamortized debt issuance costs, was $2.23 billion.

Previous wording

As of June 30, 2025, the outstanding balance on the Term Loan Facility, net of $8.2 million of unamortized OID and $18.6 million of unamortized debt issuance costs, was $823.2 million.

Current wording

As of September 30, 2025, the outstanding balance on the Term Loan Facility, net of $8.0 million of unamortized OID and $18.0 million of unamortized debt issuance costs, was $824.0 million.

Previous wording

On April 29, 2025, Merger Sub, as initial borrower, entered into the Asset-Based Revolving Credit Agreement (the “ABL Credit Agreement”), with Holdings, the lenders party thereto and Citibank, N.A., as administrative agent and collateral agent, which provides for an asset-based revolving credit facility (the “ABL Facility” and, together with the Term Loan Facility, the “Credit Facilities”), with an aggregate borrowing availability equal to the lesser of $2.0 billion, and the borrowing base. Upon the consummation of the Beacon Acquisition, the Borrower entered into a joinder to the ABL Credit Agreement as the surviving borrower. The ABL Facility matures on April 29, 2030. Based on our borrowing base as of June 30, 2025, the Company had $1.78 billion borrowing capacity under the ABL Facility.

Current wording

On April 29, 2025, Merger Sub, as initial borrower, entered into the Asset-Based Revolving Credit Agreement (the “ABL Credit Agreement”), with Holdings, the lenders party thereto and Citibank, N.A., as administrative agent and collateral agent, which provides for an asset-based revolving credit facility (the “ABL Facility” and, together with the Term Loan Facility, the “Credit Facilities”), with an aggregate borrowing availability equal to the lesser of $2.0 billion, and the borrowing base. Upon the consummation of the Beacon Acquisition, the Borrower entered into a joinder to the ABL Credit Agreement as the surviving borrower. The ABL Facility matures on April 29, 2030. Based on our borrowing base as of September 30, 2025, the Company had $1.93 billion borrowing capacity under the ABL Facility.

Previous wording

Borrowings under the ABL Facility bear interest at a rate equal to, at the Borrower’s option, either (a) (x) Term SOFR determined by reference to the secured overnight financing rate published by the Federal Reserve Bank of New York, which rate shall be no less than zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the prime rate quoted by the Wall Street Journal as the “Prime Rate” and (iii) the sum of one-month adjusted Term SOFR plus 1.00% per annum, which base rate shall be no less than 1.00%, or (y) with respect to borrowings of Canadian dollars, Term CORRA determined by reference to the interbank offered rate administered by the CORRA Administrator, which rate shall be no less than zero, in each case plus an applicable margin based on excess availability set forth in the ABL Credit Agreement. We are also required to a pay commitment fee equal to 0.20% per annum (depending on the average utilization of the commitments) to the lenders under the ABL Facility in respect of the unutilized commitments thereunder. The Borrower can make voluntary prepayments at any time without penalty, subject to customary breakage costs.

Current wording

Borrowings under the ABL Facility bear interest at a rate equal to, at the Borrower’s option, either (a) (x) Term SOFR determined by reference to the secured overnight financing rate published by the Federal Reserve Bank of New York, which rate shall be no less than zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the prime rate quoted by the Wall Street Journal as the “Prime Rate” and (iii) the sum of one-month adjusted Term SOFR plus 1.00% per annum, which base rate shall be no less than 1.00%, or (y) with respect to borrowings of Canadian dollars, Term CORRA determined by reference to the interbank offered rate administered by the CORRA Administrator, which rate shall be no less than zero, in each case plus an applicable margin based on excess availability set forth in the ABL Credit Agreement. We are also required to pay a commitment fee equal to 0.20% per annum (depending on the average utilization of the commitments) to the lenders under the ABL Facility in respect of the unutilized commitments thereunder. The Borrower can make voluntary prepayments at any time without penalty, subject to customary breakage costs.

Previous wording

The Company capitalized debt issuance costs of $18.8 million related to the ABL Facility, which are being amortized ratably over the term of the financing arrangement. The debt issuance costs related to the ABL Facility are presented as an asset, included in other assets, net on the condensed consolidated balance sheets. As of June 30, 2025, there were $18.2 million of unamortized debt issuance costs related to the ABL Facility.

Current wording

The Company capitalized debt issuance costs of $18.8 million related to the ABL Facility, which are being amortized ratably over the term of the financing arrangement. The debt issuance costs related to the ABL Facility are presented as an asset, included in other assets, net on the condensed consolidated balance sheets. As of September 30, 2025, there were $17.2 million of unamortized debt issuance costs related to the ABL Facility.

Previous wording

As of June 30, 2025, the outstanding balance on the ABL Facility was $199.9 million. The Company also had outstanding standby letters of credit related to the ABL Facility in the amount of $17.5 million as of June 30, 2025.

Current wording

As of September 30, 2025, the outstanding balance on the ABL Facility was $43.0 million. The Company also had outstanding standby letters of credit related to the ABL Facility in the amount of $21.2 million as of September 30, 2025.

Previous wording

Net cash used in operating activities was $137.7 million for the six months ended June 30, 2025, compared to $0.7 million for the six months ended June 30, 2024. Cash used in operations increased $137.0 million during the six months ended June 30, 2025. The increase in cash used in operations was primarily due to the seasonal timing of net working capital requirements for inventory purchases and cash collections.

Current wording

Net cash provided by operating activities was $74.8 million for the nine months ended September 30, 2025, compared to $30.9 million for the nine months ended September 30, 2024. Cash provided by operations increased $43.9 million during the nine months ended September 30, 2025. The increase in cash provided by operations was primarily due to the seasonal timing of net working capital requirements for inventory purchases and cash collections.

Previous wording

Net cash used in investing activities was $10.58 billion for the six months ended June 30, 2025, compared to $0.1 million for the six months ended June 30, 2024. Cash used in investing activities increased $10.58 billion in 2025 primarily due to the Beacon Acquisition and an increase in capital expenditures during the period. See Note 3 in the Notes to the Condensed Consolidated Financial Statements for more information.

Current wording

Net cash used in investing activities was $10.6 billion for the nine months ended September 30, 2025, compared to $0.1 million for the nine months ended September 30, 2024. Cash used in investing activities increased $10.6 billion during the nine months ended September 30, 2025 primarily due to the Beacon Acquisition and an increase in capital expenditures during the period. See Note 3 –Acquisition in the Notes to the Condensed Consolidated Financial Statements for more information.

Previous wording

Net cash provided by financing activities was $7.92 billion for the six months ended June 30, 2025, compared to $965.9 million for the six months ended June 30, 2024. Cash provided by financing activities increased $6.96 billion during the six months ended June 30, 2025 primarily due to the issuance of the Notes, net borrowings under our Term Loan Facility and ABL Facility, and net proceeds from the issuance of common stock and Mandatory Convertible Preferred Stock during the period, which were partially offset by net proceeds from the issuance of Convertible Preferred Stock and warrants in the prior year.

Current wording

Net cash provided by financing activities was $7.77 billion for the nine months ended September 30, 2025, compared to $5.0 billion for the nine months ended September 30, 2024. Cash provided by financing activities increased $2.77 billion during the nine months ended September 30, 2025 primarily due to the issuance of the Notes, net borrowings under our Term Loan Facility and ABL Facility, and net proceeds from the issuance of common stock and Mandatory Convertible Preferred Stock during the period, which were partially offset by net proceeds from the issuance of common stock, Convertible Preferred Stock and warrants in the prior year.