Shares of RXO Inc. (NYSE: RXO) surged 5.51% in pre-market trading on Thursday following the release of its second-quarter 2025 financial results. The logistics and transportation company reported stronger-than-expected earnings, demonstrating resilience in a challenging freight market.
RXO posted adjusted earnings per share of $0.04 for the quarter, surpassing analyst estimates of $0.02 to $0.03. This represents a significant improvement from $0.03 per share in the same period last year. However, the company's revenue of $1.4 billion fell short of the consensus estimate of $1.44 billion, despite marking a substantial 52.58% increase from $930 million in Q2 2024.
The company's performance was particularly strong in its less-than-truckload (LTL) segment, which saw volume growth of 45% year-over-year. This impressive growth helped offset a 12% decline in full truckload volume. Additionally, RXO's Last Mile business continued its upward trajectory, with stops increasing by 17% compared to the same quarter last year, marking the fourth consecutive quarter of double-digit growth. These positive trends in key segments likely contributed to investors' optimistic response.
Looking ahead, RXO provided guidance for the third quarter, projecting adjusted EBITDA between $33 million and $43 million. This outlook, combined with the company's ability to outperform earnings expectations in a challenging freight environment, appears to have bolstered investor confidence, driving the pre-market stock surge.
RXO Chairman and CEO Drew Wilkerson commented on the results, stating, "RXO executed well in the second quarter despite the prolonged soft freight market. Our Brokerage business outperformed the market, growing volume by 1% year-over-year driven by 45% growth in less-than-truckload volume." He also highlighted the company's strong cash performance and increased cash balance from the first quarter.
As the market opens, investors will be watching closely to see if RXO can maintain its early momentum and if the positive earnings surprise will translate into sustained stock price appreciation throughout the trading session.