Aug 4 (Reuters) – XPO Inc posted a higher-than-expected quarterly profit on Friday, as cost-cutting measures undertaken over the past year helped the logistics firm offset softness in freight volumes.
Companies in the logistics sector over the last few quarters have grappled with a decline in shipments, hit by lower demand for their services as consumers returned to in-store shopping patterns in a post-pandemic world.
High driver wages and maintenance expenses have also been a drag on the firms’ margins, pushing them to embark on cost-control measures to shield profits and remain competitive.
Parcel delivery firm FedEx in the last year has grounded planes, shuttered offices and cut jobs in a bid to cut $4 billion in permanent costs by the end of its 2025 financial year.
XPO, whose customers include Ford Motor Co, General Electric Co and Caterpillar Inc, posted a per share adjusted profit of 71 cents in the quarter through June, ahead of average analysts estimate of 61 cents per share, as per Refinitiv data.
However, its total revenues fell about 6% to $1.92 billion, falling short of average analysts’ estimates of $1.94 billion. (Reporting by Priyamvada C in Bengaluru; Editing by Shailesh Kuber)
