QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Large accelerated filer | o | Accelerated filer | o | ||||||||||||||
x | Smaller reporting company | ||||||||||||||||
Emerging growth company |
Page No. | |||||
March 31, | December 31, | |||||||||||||
(Dollars in millions, shares in thousands, except per share amounts) | 2023 | 2022 | ||||||||||||
ASSETS | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Accounts receivable, net of allowances of $ | ||||||||||||||
Other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Long-term assets | ||||||||||||||
Property and equipment, net of $ | ||||||||||||||
Operating lease assets | ||||||||||||||
Goodwill | ||||||||||||||
Identifiable intangible assets, net of $ | ||||||||||||||
Other long-term assets | ||||||||||||||
Total long-term assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||
Current liabilities | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued expenses | ||||||||||||||
Current maturities of long-term debt | ||||||||||||||
Short-term operating lease liabilities | ||||||||||||||
Other current liabilities | ||||||||||||||
Total current liabilities | ||||||||||||||
Long-term liabilities | ||||||||||||||
Long-term debt and obligations under finance leases | ||||||||||||||
Deferred tax liability | ||||||||||||||
Long-term operating lease liabilities | ||||||||||||||
Other long-term liabilities | ||||||||||||||
Total long-term liabilities | ||||||||||||||
Commitments and Contingencies (Note 8) | ||||||||||||||
Equity | ||||||||||||||
Preferred stock, $ outstanding as of March 31, 2023 and December 31, 2022 | ||||||||||||||
Common stock, $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Total equity | ||||||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended March 31, | ||||||||||||||
(Dollars in millions, shares in thousands, except per share amounts) | 2023 | 2022 | ||||||||||||
Revenue | $ | $ | ||||||||||||
Cost of transportation and services (exclusive of depreciation and amortization) | ||||||||||||||
Direct operating expense (exclusive of depreciation and amortization) | ||||||||||||||
Sales, general and administrative expense | ||||||||||||||
Depreciation and amortization expense | ||||||||||||||
Transaction and integration costs | ||||||||||||||
Restructuring costs | ||||||||||||||
Operating income | $ | $ | ||||||||||||
Interest expense, net | ||||||||||||||
Income (loss) before income taxes | $ | ( | $ | |||||||||||
Income tax provision (benefit) | ( | |||||||||||||
Net income | $ | $ | ||||||||||||
Earnings per share data | ||||||||||||||
Basic earnings per share | $ | $ | ||||||||||||
Diluted earnings per share | $ | $ | ||||||||||||
Weighted-average common shares outstanding | ||||||||||||||
Basic weighted-average common shares outstanding | ||||||||||||||
Diluted weighted-average common shares outstanding |
Three Months Ended March 31, | ||||||||||||||
(In millions) | 2023 | 2022 | ||||||||||||
Net income | $ | $ | ||||||||||||
Other comprehensive income, net of tax | ||||||||||||||
Foreign currency translation gain, net of tax effect of $ | $ | $ | ||||||||||||
Other comprehensive income | ||||||||||||||
Comprehensive income | $ | $ |
Three Months Ended March 31, | ||||||||||||||
(In millions) | 2023 | 2022 | ||||||||||||
Operating activities | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash from operating activities | ||||||||||||||
Depreciation and amortization expense | ||||||||||||||
Stock compensation expense | ||||||||||||||
Other | ||||||||||||||
Changes in assets and liabilities | ||||||||||||||
Accounts receivable | ( | |||||||||||||
Other assets | ( | |||||||||||||
Accounts payable | ( | |||||||||||||
Accrued expenses and other liabilities | ||||||||||||||
Net cash provided by operating activities | ||||||||||||||
Investing activities | ||||||||||||||
Payment for purchases of property and equipment | ( | ( | ||||||||||||
Net cash used in investing activities | ( | ( | ||||||||||||
Financing activities | ||||||||||||||
Payment for tax withholdings related to vesting of stock compensation awards | ( | |||||||||||||
Net transfers to XPO | ( | |||||||||||||
Other | ( | |||||||||||||
Net cash used in financing activities | ( | ( | ||||||||||||
Effect of exchange rates on cash, cash equivalents and restricted cash | ||||||||||||||
Net increase in cash, cash equivalents and restricted cash | ||||||||||||||
Cash, cash equivalents, and restricted cash, beginning of period | ||||||||||||||
Cash, cash equivalents, and restricted cash, end of period | $ | $ | ||||||||||||
Supplemental disclosure of cash flow information: | ||||||||||||||
Leased assets obtained in exchange for new operating lease liabilities | $ | $ | ||||||||||||
Cash paid for income taxes, net | ||||||||||||||
Common Stock | ||||||||||||||||||||||||||||||||||||||
(Dollars in millions, shares in thousands) | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Equity | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2022 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | ||||||||||||||||||||||||||||||||||
Vesting of stock compensation awards | — | — | — | — | ||||||||||||||||||||||||||||||||||
Tax withholdings related to vesting of stock compensation awards | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Balance as of March 31, 2023 | $ | $ | $ | $ | ( | $ |
Common Stock | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions, shares in thousands) | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | XPO Investment | Total Equity | |||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2021 | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Net transfers to XPO | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | $ | $ | $ | $ | $ | $ |
Three Months Ended March 31, | ||||||||||||||
(In millions) | 2023 | 2022 | ||||||||||||
Truck brokerage | $ | $ | ||||||||||||
Last mile | ||||||||||||||
Managed transportation | ||||||||||||||
Freight forwarding | ||||||||||||||
Eliminations | ( | ( | ||||||||||||
Total | $ | $ | ||||||||||||
Three Months Ended March 31, | ||||||||||||||
(In millions) | 2023 | 2022 | ||||||||||||
Retail/e-commerce | $ | $ | ||||||||||||
Food and beverage | ||||||||||||||
Industrial/manufacturing | ||||||||||||||
Logistics and transportation | ||||||||||||||
Automotive | ||||||||||||||
Other | ||||||||||||||
Total | $ | $ |
Three Months Ended March 31, 2023 | ||||||||||||||||||||||||||
(In millions) | Reserve Balance as of December 31, 2022 | Charges Incurred | Payments | Reserve Balance as of March 31, 2023 | ||||||||||||||||||||||
Severance | $ | $ | $ | ( | $ | |||||||||||||||||||||
Facilities | ||||||||||||||||||||||||||
Total | $ | $ | $ | ( | $ |
March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||
(In millions) | Principal Balance | Carrying Value | Principal Balance | Carrying Value | ||||||||||||||||||||||
Term Loan | $ | $ | $ | $ | ||||||||||||||||||||||
Finance leases, asset financing and other | ||||||||||||||||||||||||||
Total debt and obligations under finance leases | ||||||||||||||||||||||||||
Less: Current maturities of long-term debt | ||||||||||||||||||||||||||
Total long-term debt and obligations under finance leases | $ | $ | $ | $ |
(In millions) | Level | March 31, 2023 | December 31, 2022 | |||||||||||||||||
Term Loan | 2 | $ | $ | |||||||||||||||||
1 |
Three Months Ended March 31, | ||||||||||||||
(Dollars in millions, shares in thousands, except per share data) | 2023 | 2022 | ||||||||||||
Net income | $ | $ | ||||||||||||
Basic weighted-average common shares | ||||||||||||||
Dilutive effect of stock-based awards | ||||||||||||||
Diluted weighted-average common shares | ||||||||||||||
Basic earnings per share | $ | $ | ||||||||||||
Diluted earnings per share | $ | $ |
Three Months Ended March 31, | ||||||||
(In millions) | 2022 | |||||||
Sales, general and administrative expense | $ | |||||||
Depreciation and amortization expense | ||||||||
Transaction and integration costs | ||||||||
Total | $ |
Three Months Ended March 31, | ||||||||
(In millions) | 2022 | |||||||
Revenue | $ | |||||||
Costs |
Three Months Ended March 31, | Percent of Revenue | |||||||||||||||||||||||||
(In millions) | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Revenue | $ | 1,010 | $ | 1,312 | 100.0 | % | 100.0 | % | ||||||||||||||||||
Cost of transportation and services (exclusive of depreciation and amortization) | 759 | 1,021 | 75.1 | % | 77.8 | % | ||||||||||||||||||||
Direct operating expense (exclusive of depreciation and amortization) | 61 | 55 | 6.0 | % | 4.2 | % | ||||||||||||||||||||
Sales, general and administrative expense | 153 | 161 | 15.1 | % | 12.3 | % | ||||||||||||||||||||
Depreciation and amortization expense | 18 | 21 | 1.8 | % | 1.6 | % | ||||||||||||||||||||
Transaction and integration costs | 6 | 3 | 0.6 | % | 0.2 | % | ||||||||||||||||||||
Restructuring costs | 8 | — | 0.8 | % | — | % | ||||||||||||||||||||
Operating income | $ | 5 | $ | 51 | 0.5 | % | 3.9 | % | ||||||||||||||||||
Interest expense, net | 8 | — | 0.8 | % | — | % | ||||||||||||||||||||
Income (loss) before income taxes | $ | (3) | $ | 51 | (0.3) | % | 3.9 | % | ||||||||||||||||||
Income tax provision (benefit) | (3) | 12 | (0.3) | % | 0.9 | % | ||||||||||||||||||||
Net income | $ | — | $ | 39 | — | % | 3.0 | % | ||||||||||||||||||
As of March 31, | As of December 31, | |||||||||||||||||||||||||
(In millions) | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Total current assets | $ | 1,029 | $ | 1,029 | $ | — | — | % | ||||||||||||||||||
Total long-term assets | 989 | 1,002 | (13) | (1.3) | % | |||||||||||||||||||||
Total current liabilities | 820 | 823 | (3) | (0.4) | % | |||||||||||||||||||||
Total long-term liabilities | 613 | 621 | (8) | (1.3) | % |
Three Months Ended March 31, | ||||||||||||||||||||||||||
(In millions) | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Net cash provided by operating activities | $ | 42 | $ | 103 | $ | (61) | (59.2) | % | ||||||||||||||||||
Net cash used in investing activities | (12) | (12) | — | — | % | |||||||||||||||||||||
Net cash used in financing activities | (8) | (74) | 66 | (89.2) | % | |||||||||||||||||||||
Effect of exchange rates on cash, cash equivalents and restricted cash | 1 | — | 1 | 100.0 | % | |||||||||||||||||||||
Net increase in cash, cash equivalents and restricted cash | $ | 23 | $ | 17 | $ | 6 | 35.3 | % |
Exhibit Number | Description | |||||||
10.17 *+ | ||||||||
31.1 * | ||||||||
31.2 * | ||||||||
32.1 ** | ||||||||
32.2 ** | ||||||||
101.INS * | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||
101.SCH * | XBRL Taxonomy Extension Schema. | |||||||
101.CAL * | XBRL Taxonomy Extension Calculation Linkbase. | |||||||
101.DEF * | XBRL Taxonomy Extension Definition Linkbase. | |||||||
101.LAB * | XBRL Taxonomy Extension Label Linkbase. | |||||||
101.PRE * | XBRL Taxonomy Extension Presentation Linkbase. | |||||||
104 * | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
Date: May 3, 2023 | RXO, INC. | |||||||
By: | /s/ Drew M. Wilkerson | |||||||
Drew M. Wilkerson | ||||||||
Chief Executive Officer | ||||||||
(Principal Executive Officer) | ||||||||
By: | /s/ James E. Harris | |||||||
James E. Harris | ||||||||
Chief Financial Officer | ||||||||
(Principal Financial Officer) |
If to the Company: | RXO, Inc. 11215 North Community House Road Charlotte, NC 28277 USA Attention: Chief Human Resources Officer | ||||
If to you: | To your address as most recently supplied to the Company and set forth in the Company’s records |
RXO, Inc. | ||||||||
By: | /s/ Heidi Ratti | |||||||
Name: | Heidi Ratti | |||||||
Title: | Chief Human Resources Officer | |||||||
/s/ Drew M. Wilkerson | |||||
Drew M. Wilkerson | |||||
Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
Date: May 3, 2023 |
/s/ James E. Harris | |||||
James E. Harris | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) | |||||
Date: May 3, 2023 |
/s/ Drew M. Wilkerson | |||||
Drew M. Wilkerson | |||||
Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
Date: May 3, 2023 |
/s/ James E. Harris | |||||
James E. Harris | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) | |||||
Date: May 3, 2023 |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 12 | $ 13 |
Accumulated depreciation | 255 | 241 |
Finite-lived intangible assets, accumulated amortization | $ 110 | $ 106 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 116,853,000 | 116,400,000 |
Common stock, shares outstanding (in shares) | 116,853,000 | 116,400,000 |
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 0 | $ 39 |
Other comprehensive income, net of tax | ||
Foreign currency translation gain, net of tax effect of $— and $— | 0 | 2 |
Other comprehensive income | 0 | 2 |
Comprehensive income | $ 0 | $ 41 |
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustment, tax, portion attributable to parent | $ 0 | $ 0 |
Organization |
3 Months Ended |
---|---|
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | OrganizationRXO, Inc. (“RXO”, the “Company” or “we”) is a brokered transportation platform defined by cutting-edge technology and an asset-light business model. The largest component is our core truck brokerage business. Our operations also include three asset-light, brokered transportation services, all of which complement our truck brokerage business: managed transportation, last mile and freight forwarding. We present our operations in the condensed consolidated financial statements as one reportable segment. |
Basis of Presentation and Significant Accounting Policies |
3 Months Ended |
---|---|
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the 2022 Form 10-K. The Company’s condensed consolidated financial statements include the accounts of RXO, Inc. and its majority-owned subsidiaries. All intercompany accounts and transactions have been eliminated. The condensed consolidated financial statements reflect all adjustments that are of a normal recurring nature and are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. On November 1, 2022, the Company completed the separation (the “Separation”) from XPO, Inc. (formerly known as XPO Logistics, Inc.) (“XPO”). The Separation was accomplished by the distribution of 100 percent of the outstanding common stock of RXO to XPO stockholders as of the close of business on October 20, 2022, the record date for the distribution. XPO stockholders received one share of RXO common stock for every share of XPO common stock held at the close of business on the record date. The Separation was completed under a Separation and Distribution Agreement and various other agreements that govern aspects of the Company’s relationship with XPO. On November 1, 2022, the Company became a standalone publicly traded company, and its financial statements post-Separation are prepared on a consolidated basis. Prior to the Separation, the Company’s financial statements were prepared on a standalone combined basis and were derived from the consolidated financial statements and accounting records of XPO (the “historical financial statements”). The combined financial statements for all periods presented prior to the Separation are now also referred to as “condensed consolidated financial statements,” and have been prepared in accordance with GAAP. In connection with the Separation, the Company’s assets and liabilities were transferred to the Company on a carry-over basis. Prior to the Separation, the historical results of operations included allocations of XPO costs and expenses, including XPO’s corporate function which incurred a variety of expenses including, but not limited to, information technology, human resources, accounting, sales and sales operations, procurement, executive services, legal, corporate finance and communications. An allocation of these expenses is included to burden all business units comprising XPO’s historical results of operations, including RXO. The charges reflected have either been specifically identified or allocated using drivers including proportionally adjusted earnings before interest, taxes, depreciation and amortization, which includes adjustments for transaction and integration costs, as well as restructuring costs and other adjustments, or headcount. The Company believes the assumptions regarding allocations of XPO corporate expenses are reasonable. Nevertheless, the condensed consolidated financial statements may not reflect the results of operations, financial position and cash flows had the Company been a standalone entity during the prior periods presented. The majority of these allocated costs are recorded within Sales, general and administrative expense; Depreciation and amortization expense; and Transaction and integration costs in the Condensed Consolidated Statements of Operations. All charges and allocations for facilities, functions and services performed by XPO organizations have been deemed settled in cash by RXO to XPO in the year in which the cost was recorded in the Condensed Consolidated Statements of Operations. For the periods ended before the Separation, XPO investment represents XPO’s historical investment in RXO and includes the net effects of transactions with and allocations from XPO as well as RXO’s accumulated earnings. Certain transactions between RXO and XPO, including XPO’s non-RXO subsidiaries, have been included in these condensed consolidated financial statements, and are considered to be effectively settled at the time the transaction is recorded. The total net effect of the cash settlement of these transactions is reflected in the Condensed Consolidated Statements of Cash Flows as a financing activity and in the Condensed Consolidated Statements of Changes in Equity as XPO investment. The components of the net transfers to and from XPO include certain costs allocated from XPO’s corporate functions, income tax expense, certain cash receipts and payments made on behalf of RXO and general financing activities. For the periods ended before the Separation, the Company was a member of the XPO consolidated group, and its U.S. taxable income was included in XPO’s consolidated U.S. federal income tax return as well as in the tax returns filed by XPO with certain state and local taxing jurisdictions. For the periods ended after the Separation, the Company will file a consolidated U.S. federal income tax return as well as state and local income tax returns. The Company’s foreign income tax returns are filed on a full-year basis. Significant Accounting Policies Our significant accounting policies are disclosed in Note 2 to the 2022 Form 10-K. There have been no material changes to the Company’s significant accounting policies as of March 31, 2023. Adoption of New Accounting Standards In September 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-04, “Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations.” The ASU increases the transparency surrounding supplier finance programs by requiring the buyer to disclose information on an annual basis about the key terms of the program, the outstanding obligation amounts as of the end of the period, a roll-forward of such amounts, and the balance sheet presentation of the related amounts. Additionally, the obligation amount outstanding at the end of the period must be disclosed in interim periods. The amendments are effective for fiscal years beginning after December 15, 2022 except for the requirement to disclose the roll-forward information, which is effective for fiscal years beginning after December 15, 2023. We adopted this standard on January 1, 2023, on a prospective basis. The adoption did not have an impact on our financial statement disclosures. Accounting Pronouncements Issued but Not Yet Effective In March 2023, the FASB issued ASU 2023-01, “Leases (Topic 842) - Common Control Arrangements”. The amendments in this update improve current GAAP by clarifying the accounting treatment for leasehold improvements associated with common control leases in order to create uniformity in practice. The ASU seeks to provide guidance to more accurately match the amortization expense of leasehold improvements under common control arrangements with the useful life of the improvements to the consolidated entity as a whole. The amendments are effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. We are currently evaluating the impact of the new guidance.
|
Revenue Recognition |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition Disaggregation of Revenues We disaggregate our revenue by geographic area, service offering and industry sector. The majority of our revenue, based on sales office location, is generated in the U.S. Approximately 7% and 9% of our revenues were generated outside the U.S. (primarily in North America, excluding the U.S., and Asia) for the three months ended March 31, 2023 and 2022, respectively. Our revenue disaggregated by service offering is as follows:
Our revenue disaggregated by industry sector is as follows:
Performance Obligations Remaining performance obligations represent firm contracts for which services have not been performed and future revenue recognition is expected. As permitted in determining the remaining performance obligation, we omit obligations that: (i) have original expected durations of one year or less or (ii) contain variable consideration. As of March 31, 2023, the fixed consideration component of our remaining performance obligation was approximately $153 million, and we expect approximately 97% of that amount to be recognized over the next 3 years and the remainder thereafter. We estimate remaining performance obligations at a point in time and actual amounts may differ from these estimates due to changes in foreign currency exchange rates and contract revisions or terminations.
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Restructuring Charges |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Charges | Restructuring Charges We engage in restructuring actions as part of our ongoing efforts to best use our resources and infrastructure. These actions generally include severance and facility-related costs, including impairment of operating lease assets, and are intended to improve our efficiency and profitability going forward. The following is a roll-forward of the Company’s restructuring liability, which is included in Accrued expenses in the Condensed Consolidated Balance Sheets:
We expect the majority of the cash outlays related to the remaining restructuring liability at March 31, 2023 to be complete within twelve months.
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The following table summarizes the principal balance and carrying value of our debt:
(1)The carrying value of the 7.50% Notes due 2027 is presented net of unamortized debt issuance cost and discount of $9 million and $9 million as of March 31, 2023 and December 31, 2022, respectively. Revolving Credit Agreement On October 18, 2022, we entered into a five-year, unsecured multi-currency revolving credit facility (the “Revolver”). The Revolver borrowing capacity is up to $500 million, of which $50 million is available for the issuance of letters of credit. Loans under the Revolver bear interest at a fluctuating rate plus an applicable margin based on the Company’s credit ratings. The Company is required to pay a commitment fee on any unused commitment, based on pricing levels set forth in the agreement. The covenants in the Revolver are customary for financings of this type. The Revolver requires the Company to maintain a maximum consolidated leverage ratio and minimum interest coverage ratio. At March 31, 2023, the Company was in compliance with the covenants of the Revolver. There were no amounts outstanding under the Revolver as of March 31, 2023 or December 31, 2022. Term Loan Credit Agreement On October 18, 2022, we entered into a five-year $100 million unsecured term loan facility (the “Term Loan”). The Term Loan bears interest at a fluctuating rate plus an applicable margin calculated based on the Company’s credit ratings, payable at least quarterly. Beginning with the fiscal quarter ending March 31, 2025, the Term Loan will amortize on a quarterly basis in an amount equal to (i) 5% per annum for the first eight fiscal quarters ending on or after such date and (ii) 10% per annum for each fiscal quarter ending thereafter. The Term Loan matures on November 1, 2027. The effective interest rate on the Term Loan was 5.93% as of March 31, 2023. The covenants in the Term Loan are customary for financings of this type. In addition, the Term Loan requires the Company to maintain a maximum consolidated leverage ratio and minimum interest coverage ratio. At March 31, 2023, the Company was in compliance with the covenants of the credit agreement governing the Term Loan. Notes On October 25, 2022, we completed an offering of $355 million in unsecured notes (the “Notes” or the “7.50% Notes due 2027”). The Notes bear interest at a rate of 7.50% per annum payable semiannually in cash in arrears on May 15 and November 15 of each year, beginning May 15, 2023, and mature on November 15, 2027, unless earlier repurchased or redeemed, if applicable. The Notes were issued at an issue price of 98.962% of par. The effective interest rate on the Notes was 8.14% as of March 31, 2023. The Notes are guaranteed by each of our direct and indirect wholly owned domestic subsidiaries (other than certain excluded subsidiaries). The Notes and its guarantees are unsecured, senior indebtedness for us and our guarantors. The Notes contain covenants customary for debt securities of this nature. At March 31, 2023, the Company was in compliance with the covenants of the Notes.
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The levels of inputs used to measure fair value are: •Level 1—Quoted prices for identical instruments in active markets; •Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets; and •Level 3—Valuations based on inputs that are unobservable, generally utilizing pricing models or other valuation techniques that reflect management’s judgment and estimates. Assets and Liabilities The Company bases its fair value estimates on market assumptions and available information. The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and current maturities of long-term debt approximated their fair values as of March 31, 2023 and December 31, 2022, due to their short-term nature and/or being receivable or payable on demand. Debt The fair value of our debt and classification in the fair value hierarchy is as follows:
We valued Level 1 debt using quoted prices in active markets. We valued Level 2 debt using bid evaluation pricing models or quoted prices of securities with similar characteristics.
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Earnings per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per Share On November 1, 2022, the date of the Separation, 115,162,555 shares of common stock of the Company were distributed to XPO stockholders of record as of the record date and began regular-way trading. This share amount is utilized for the calculation of basic and diluted earnings per share for the three months ended March 31, 2022. The computations of basic and diluted earnings per share are as follows:
For the three months ended March 31, 2023, approximately 0.9 million shares are excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.
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Commitments and Contingencies |
3 Months Ended |
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Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are involved, and will continue to be involved, in numerous proceedings arising out of the conduct of our business. These proceedings may include claims for property damage or personal injury incurred in connection with the transportation of freight, environmental liability, commercial disputes and employment-related claims, including claims involving asserted breaches of employee restrictive covenants. These matters also include several class action and collective action cases involving claims that the contract carriers with which we contract for performance of delivery services, or their delivery workers, should be treated as employees, rather than independent contractors (“misclassification claims”) and may seek substantial monetary damages (including claims for unpaid wages, overtime, unreimbursed business expenses, deductions from wages, penalties and other items), injunctive relief, or both. We establish accruals for specific legal proceedings when it is considered probable that a loss has been incurred and the amount of the loss can be reasonably estimated. If a loss is not both probable and reasonably estimable, or if an exposure to loss exists in excess of the amount accrued, we assess whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred. If there is a reasonable possibility that a loss, or additional loss, may have been incurred, we disclose the estimate of the possible loss or range of loss if it is material and an estimate can be made, or disclose that such an estimate cannot be made. The determination as to whether a loss can reasonably be considered to be possible or probable is based on our assessment, together with legal counsel, regarding the ultimate outcome of the matter. We believe that we have adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable. We do not believe that the ultimate resolution of any matters to which we are presently a party will have a material adverse effect on our results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our financial condition, results of operations or cash flows. Legal costs incurred related to these matters are expensed as incurred. We carry liability and excess umbrella insurance policies that are deemed sufficient to cover potential legal claims arising in the normal course of conducting our operations as a transportation company. The liability and excess umbrella insurance policies generally do not cover the misclassification claims described in this note. In the event we are required to satisfy a legal claim outside the scope of the coverage provided by insurance, our financial condition, results of operations or cash flows could be negatively impacted. Our last mile subsidiary is involved in several class action and collective action cases involving misclassification claims. The misclassification claims related solely to our last mile business, which operated as a wholly owned subsidiary of XPO until the spin-off of RXO was completed. As of November 1, 2022, pursuant to the Separation and Distribution Agreement between XPO and RXO, the liabilities of XPO’s last mile subsidiary, including legal liabilities, if any, related to the misclassification claims, were spun-off as part of RXO. Pursuant to the Separation and Distribution Agreement, RXO has agreed to indemnify XPO for certain matters relating to RXO, including indemnifying XPO from and against any liabilities, damages, costs, or expenses incurred by XPO arising out of or resulting from the misclassification claims. We believe these suits are without merit and we intend to defend the Company vigorously. We are unable at this time to determine the amount of the possible loss or range of loss, if any, that we may incur as a result of these matters.
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Related Party |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party | Related Party Prior to the Separation, the Company did not operate as a standalone business and the condensed consolidated financial statements were derived from the consolidated financial statements and accounting records of XPO. Transactions between the Company and XPO, and other non-RXO subsidiaries of XPO, that occurred prior to the Separation have been classified as related-party transactions. Transactions that originated with XPO prior to the Separation were cash settled or forgiven as of November 1, 2022. For amounts that were forgiven, the amounts have been recorded as an adjustment to XPO Investment. Allocation of General Corporate Expenses Post-Separation, general shared costs from XPO were no longer allocated to the company, therefore no related amounts were reflected on the Company’s financial statements for the three months ended March 31, 2023. Prior to the Separation, certain shared costs were allocated to the Company from XPO’s corporate overhead. The Condensed Consolidated Statements of Operations include expenses for certain centralized functions and other programs provided and/or administered by XPO that were charged directly to the Company. In addition, for purposes of preparing these condensed consolidated financial statements, a portion of XPO’s total corporate expenses have been allocated to the Company. See Note 2 - Basis of Presentation and Significant Accounting Policies for a discussion of the methodology used to allocate such costs for purposes of preparing these condensed consolidated financial statements. Costs included in our Condensed Consolidated Statements of Operations for our allocated share of XPO’s corporate overhead are as follows:
Transactions with XPO and its non-RXO Subsidiaries Revenue and costs generated from related parties are as follows:
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Subsequent Events |
3 Months Ended |
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Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn May 2, 2023, the RXO Board of Directors authorized us to repurchase an indeterminate number of shares of our common stock at an aggregate purchase price of up to $125 million (the “2023 Share Repurchase Program”). The 2023 Share Repurchase Program does not have an expiration date and may be suspended or discontinued at any time. We are not obligated to repurchase any specific number of shares. |
Basis of Presentation and Significant Accounting Policies (Policies) |
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Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the 2022 Form 10-K. The Company’s condensed consolidated financial statements include the accounts of RXO, Inc. and its majority-owned subsidiaries. All intercompany accounts and transactions have been eliminated. The condensed consolidated financial statements reflect all adjustments that are of a normal recurring nature and are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. On November 1, 2022, the Company completed the separation (the “Separation”) from XPO, Inc. (formerly known as XPO Logistics, Inc.) (“XPO”). The Separation was accomplished by the distribution of 100 percent of the outstanding common stock of RXO to XPO stockholders as of the close of business on October 20, 2022, the record date for the distribution. XPO stockholders received one share of RXO common stock for every share of XPO common stock held at the close of business on the record date. The Separation was completed under a Separation and Distribution Agreement and various other agreements that govern aspects of the Company’s relationship with XPO. On November 1, 2022, the Company became a standalone publicly traded company, and its financial statements post-Separation are prepared on a consolidated basis. Prior to the Separation, the Company’s financial statements were prepared on a standalone combined basis and were derived from the consolidated financial statements and accounting records of XPO (the “historical financial statements”). The combined financial statements for all periods presented prior to the Separation are now also referred to as “condensed consolidated financial statements,” and have been prepared in accordance with GAAP. In connection with the Separation, the Company’s assets and liabilities were transferred to the Company on a carry-over basis. Prior to the Separation, the historical results of operations included allocations of XPO costs and expenses, including XPO’s corporate function which incurred a variety of expenses including, but not limited to, information technology, human resources, accounting, sales and sales operations, procurement, executive services, legal, corporate finance and communications. An allocation of these expenses is included to burden all business units comprising XPO’s historical results of operations, including RXO. The charges reflected have either been specifically identified or allocated using drivers including proportionally adjusted earnings before interest, taxes, depreciation and amortization, which includes adjustments for transaction and integration costs, as well as restructuring costs and other adjustments, or headcount. The Company believes the assumptions regarding allocations of XPO corporate expenses are reasonable. Nevertheless, the condensed consolidated financial statements may not reflect the results of operations, financial position and cash flows had the Company been a standalone entity during the prior periods presented. The majority of these allocated costs are recorded within Sales, general and administrative expense; Depreciation and amortization expense; and Transaction and integration costs in the Condensed Consolidated Statements of Operations. All charges and allocations for facilities, functions and services performed by XPO organizations have been deemed settled in cash by RXO to XPO in the year in which the cost was recorded in the Condensed Consolidated Statements of Operations. For the periods ended before the Separation, XPO investment represents XPO’s historical investment in RXO and includes the net effects of transactions with and allocations from XPO as well as RXO’s accumulated earnings. Certain transactions between RXO and XPO, including XPO’s non-RXO subsidiaries, have been included in these condensed consolidated financial statements, and are considered to be effectively settled at the time the transaction is recorded. The total net effect of the cash settlement of these transactions is reflected in the Condensed Consolidated Statements of Cash Flows as a financing activity and in the Condensed Consolidated Statements of Changes in Equity as XPO investment. The components of the net transfers to and from XPO include certain costs allocated from XPO’s corporate functions, income tax expense, certain cash receipts and payments made on behalf of RXO and general financing activities. For the periods ended before the Separation, the Company was a member of the XPO consolidated group, and its U.S. taxable income was included in XPO’s consolidated U.S. federal income tax return as well as in the tax returns filed by XPO with certain state and local taxing jurisdictions. For the periods ended after the Separation, the Company will file a consolidated U.S. federal income tax return as well as state and local income tax returns. The Company’s foreign income tax returns are filed on a full-year basis.
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Adoption of New Accounting Standards & Accounting Pronouncements Issued but Not Yet Effective | Adoption of New Accounting Standards In September 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-04, “Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations.” The ASU increases the transparency surrounding supplier finance programs by requiring the buyer to disclose information on an annual basis about the key terms of the program, the outstanding obligation amounts as of the end of the period, a roll-forward of such amounts, and the balance sheet presentation of the related amounts. Additionally, the obligation amount outstanding at the end of the period must be disclosed in interim periods. The amendments are effective for fiscal years beginning after December 15, 2022 except for the requirement to disclose the roll-forward information, which is effective for fiscal years beginning after December 15, 2023. We adopted this standard on January 1, 2023, on a prospective basis. The adoption did not have an impact on our financial statement disclosures. Accounting Pronouncements Issued but Not Yet Effective In March 2023, the FASB issued ASU 2023-01, “Leases (Topic 842) - Common Control Arrangements”. The amendments in this update improve current GAAP by clarifying the accounting treatment for leasehold improvements associated with common control leases in order to create uniformity in practice. The ASU seeks to provide guidance to more accurately match the amortization expense of leasehold improvements under common control arrangements with the useful life of the improvements to the consolidated entity as a whole. The amendments are effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. We are currently evaluating the impact of the new guidance.
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Revenue Recognition (Tables) |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | Our revenue disaggregated by service offering is as follows:
Our revenue disaggregated by industry sector is as follows:
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Restructuring Charges (Tables) |
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Schedule of Restructuring Reserve by Type of Cost | The following is a roll-forward of the Company’s restructuring liability, which is included in Accrued expenses in the Condensed Consolidated Balance Sheets:
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Debt (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table summarizes the principal balance and carrying value of our debt:
(1)The carrying value of the 7.50% Notes due 2027 is presented net of unamortized debt issuance cost and discount of $9 million and $9 million as of March 31, 2023 and December 31, 2022, respectively. The fair value of our debt and classification in the fair value hierarchy is as follows:
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Fair Value Measurements (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table summarizes the principal balance and carrying value of our debt:
(1)The carrying value of the 7.50% Notes due 2027 is presented net of unamortized debt issuance cost and discount of $9 million and $9 million as of March 31, 2023 and December 31, 2022, respectively. The fair value of our debt and classification in the fair value hierarchy is as follows:
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Earnings Per Share (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The computations of basic and diluted earnings per share are as follows:
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Related Party (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions | Costs included in our Condensed Consolidated Statements of Operations for our allocated share of XPO’s corporate overhead are as follows:
Revenue and costs generated from related parties are as follows:
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Organization (Details) |
3 Months Ended |
---|---|
Mar. 31, 2023
reportingSegment
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 1 |
Basis of Presentation and Significant Accounting Policies (Details) |
Nov. 01, 2022
shares
|
---|---|
Accounting Policies [Abstract] | |
Distribution of outstanding common stock, percentage | 100.00% |
Shares of common stock per share of parent's stock | 1 |
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Amount of remaining performance obligation | $ 153 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | ||
Disaggregation of Revenue [Line Items] | ||
Percentage of remaining performance obligation | 97.00% | |
Remaining performance obligation period | 3 years | |
Geographic Concentration Risk | Revenue from Contract with Customer Benchmark | Non-US | ||
Disaggregation of Revenue [Line Items] | ||
Percentage of revenue generated outside the U.S. | 7.00% | 9.00% |
Revenue Recognition - Disaggregation of Revenue by Service (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,010 | $ 1,312 |
Truck brokerage | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 600 | 824 |
Last mile | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 240 | 246 |
Managed transportation | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 117 | 139 |
Freight forwarding | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 80 | 139 |
Eliminations | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ (27) | $ (36) |
Revenue Recognition - Disaggregation of Revenue by Industry Sector (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,010 | $ 1,312 |
Retail/e-commerce | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 386 | 481 |
Food and beverage | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 105 | 150 |
Industrial/manufacturing | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 181 | 229 |
Logistics and transportation | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 52 | 87 |
Automotive | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 102 | 89 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 184 | $ 276 |
Restructuring Charges - Schedule of Restructuring Activity (Details) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2023
USD ($)
| |
Restructuring Reserve [Roll Forward] | |
Restructuring reserve, beginning balance | $ 3 |
Charges Incurred | 8 |
Payments | (3) |
Restructuring reserve, ending balance | 8 |
Severance | |
Restructuring Reserve [Roll Forward] | |
Restructuring reserve, beginning balance | 2 |
Charges Incurred | 8 |
Payments | (3) |
Restructuring reserve, ending balance | 7 |
Facilities | |
Restructuring Reserve [Roll Forward] | |
Restructuring reserve, beginning balance | 1 |
Charges Incurred | 0 |
Payments | 0 |
Restructuring reserve, ending balance | $ 1 |
Debt - Schedule of Carrying Values of Debt (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Debt instrument, face amount | $ 464 | $ 464 |
Total debt and obligations under finance leases, principal balance | 455 | 455 |
Current maturities of long-term debt | 4 | 4 |
Total long-term debt and obligations under finance leases - principal balance | 460 | 460 |
Long-term debt and obligations under finance leases | 451 | 451 |
Unamortized discount (premium) and debt issuance costs, net | 9 | 9 |
Term Loan | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | 100 | 100 |
Total debt and obligations under finance leases, principal balance | 100 | 100 |
7.50% Notes due 2027 | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | 355 | 355 |
Total debt and obligations under finance leases, principal balance | 346 | 346 |
Finance leases, asset financing and other | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | 9 | 9 |
Total debt and obligations under finance leases, principal balance | $ 9 | $ 9 |
Fair Value Measurements (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Term Loan | Fair Value, Inputs, Level 2 | ||
Debt Instrument [Line Items] | ||
Debt instrument, fair value | $ 95 | $ 95 |
7.50% Notes due 2027 | Fair Value, Inputs, Level 1 | ||
Debt Instrument [Line Items] | ||
Debt instrument, fair value | $ 367 | $ 358 |
Earnings per Share - Narrative (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Nov. 01, 2022 |
|
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 900,000 | |
Common Stock | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Shares of RXO common stock, outstanding | 115,162,555 |
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share [Abstract] | ||
Net income, basic | $ 0 | $ 39 |
Net income, diluted | $ 0 | $ 39 |
Basic weighted-average common shares (in shares) | 116,600 | 115,163 |
Dilutive effect of stock-based awards (in shares) | 2,769 | 0 |
Diluted weighted-average common shares (in shares) | 119,369 | 115,163 |
Basic earnings per share (in dollars per share) | $ 0 | $ 0.34 |
Diluted earnings per share (in dollars per share) | $ 0 | $ 0.34 |
Related Party - Costs for Allocated Share of XPO's Corporate Overhead (Details) - XPO and its Affiliates $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
| |
Related Party Transaction [Line Items] | |
Corporate overhead allocated from related party | $ 23 |
Sales, general and administrative expense | |
Related Party Transaction [Line Items] | |
Corporate overhead allocated from related party | 18 |
Depreciation and amortization expense | |
Related Party Transaction [Line Items] | |
Corporate overhead allocated from related party | 2 |
Transaction and integration costs | |
Related Party Transaction [Line Items] | |
Corporate overhead allocated from related party | $ 3 |
Related Party - Schedule of Revenue and Expenses From Related Party (Details) - XPO and its Affiliates $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
| |
Related Party Transaction [Line Items] | |
Revenue | $ 49 |
Costs | $ 17 |
Subsequent Events (Details) $ in Millions |
May 02, 2023
USD ($)
|
---|---|
2023 Share Repurchase Program | Subsequent Event | |
Subsequent Event [Line Items] | |
Stock repurchase program, authorized amount | $ 125 |
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