XPO Logistics (NYSE: XPO) saw its stock price surge 6.74% in pre-market trading on Wednesday following the release of its first-quarter 2025 financial results. The company's earnings surpassed analyst expectations, despite a slight miss on revenue, as operational improvements and cost management initiatives continued to bear fruit.

The freight transportation company reported adjusted earnings per share (EPS) of $0.73 for the quarter, significantly beating the analyst consensus estimate of $0.65. This represents a 12.31% outperformance compared to Wall Street's projections. XPO's adjusted EBITDA also exceeded expectations, coming in at $278 million versus the estimated $272.5 million, showcasing the company's ability to enhance profitability in a challenging market environment.

While XPO's revenue of $1.95 billion fell slightly short of the projected $1.98 billion and represented a 3.2% year-over-year decline, investors appeared to focus on the company's improved operational efficiency and cost management. The North American Less-Than-Truckload segment, which accounts for about 60% of XPO's revenue, showed signs of improvement with an adjusted operating ratio of 85.9%, reflecting a sequential improvement of 30 basis points compared to the fourth quarter of 2024.

Mario Harik, CEO of XPO, expressed confidence in the company's performance, stating, "We carried our momentum into 2025 and delivered first quarter financial results that outperformed the industry. Companywide, we reported adjusted EBITDA of $278 million and adjusted diluted EPS of $0.73, while operating more efficiently." This positive outlook, combined with the strong earnings beat, likely contributed to the significant stock price increase in pre-market trading.