# GXO Logistics Reports 19% Revenue Growth in Q2 2024
**Growth Across Most Segments; Net Income Declines**
GXO is on track to secure a record amount of new business in 2024 (GXO Logistics)
GXO Logistics reported a 19% increase in revenue for the second quarter of 2024, reaching $2.85 billion. However, the contract logistics company headquartered in Greenwich, Connecticut, saw its net income drop from $66 million last year to $39 million. Diluted earnings per share fell from 55 cents to 32 cents.
GXO ranks fifth among North America’s top 100 logistics companies according to Transport Topics and fourth in the dry storage warehousing sector.
“GXO delivered a strong second quarter, successfully completing a great first half of the year, and we are very pleased to reaffirm our full-year guidance for 2024 today,” CEO Malcolm Wilson said during a call with investors. “In this quarter, we secured approximately $270 million in new business, marking three consecutive quarters of growth.”
Wilson added that the current pipeline for new business is at its highest point in 12 months, reaching $2.3 billion. He also noted that the company won over $520 million in new business during the first half of this year. Wilson mentioned that contract durations are lengthening as customers seek to partner with companies capable of managing their supply chain complexities on a global scale.
Wilson
“We’re also pleased to have expanded our relationships with several long-term clients this quarter,” Wilson said. “Our land and expand strategy remains central to our long-term organic growth plan. Currently, about half of our revenue comes from serving customers in multiple countries. The new contracts we win are key drivers of our growth.”
GXO is on track to secure a record amount of new business in 2024. Wilson believes the industry reached the bottom of its inventory cycle in Q4. He sees volume trends starting to improve, with e-commerce returning to sustainable structural growth at an industry level.
“Customer demand for outsourcing has remained strong throughout the cycle as clients seek to enhance productivity, reduce complexity, and view supply chains as part of their strategy,” Wilson said. “About half of the contracts we signed this quarter are new outsourcing activities.”
GXO completed its acquisition of UK transportation and logistics services company Wincanton in this quarter. The company expects the acquisition to create significant value, allowing both new and existing customers to benefit from a broader range of services and capabilities while expanding the global platform.
“We’re also pleased to have completed the acquisition of Wincanton in Q2,” Wilson said. “This transaction showcases our M&A strategy. By acquiring Wincanton, we’ve gained a platform that will allow us to expand our presence in target verticals in the UK and Europe, including aerospace, defense, and industrial sectors. The valuation for this acquisition is very attractive.”
Wilson highlighted the importance of operations in Germany to its growth strategy. There, the company has signed a 20-year contract with Levi’s and new agreements with retailer and coffee distributor Tchibo.
“In European and UK markets, we see customers becoming more confident about launching larger projects,” Wilson said. “This is good news for our future growth and the acquisition of Wincanton. In North America, despite current softness in goods demand, we secured record-breaking new business during the first half of this year. Our long-term contract-based business model gives us confidence to deliver on our 2027 target, with revenue expected between $15.5 billion and $16 billion.”
Multichannel retail led GXO’s revenue growth, up 28.3% to $1.32 billion year-over-year. The consumer packaged goods and industrial manufacturing sectors also saw strong growth of over 20%. The technology and consumer electronics sector showed moderate growth, while the food and beverage channel experienced a slight decline. These five segments are GXO’s main revenue drivers.
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Source: Transport Topics
