Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-32172 | |
Entity Registrant Name | XPO, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 03-0450326 | |
Entity Address, Address Line One | Five American Lane | |
Entity Address, City or Town | Greenwich, | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06831 | |
City Area Code | 855 | |
Local Phone Number | 976-6951 | |
Title of 12(b) Security | Common stock, par value $0.001 per share | |
Trading Symbol | XPO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Small Business Entity | false | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 115,857,013 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001166003 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 309 | $ 460 |
Accounts receivable, net of allowances of $48 and $43, respectively | 1,019 | 954 |
Other current assets | 221 | 199 |
Current assets of discontinued operations | 16 | 17 |
Total current assets | 1,565 | 1,630 |
Long-term assets | ||
Property and equipment, net of $1,743 and $1,679 in accumulated depreciation, respectively | 1,978 | 1,832 |
Operating lease assets | 717 | 719 |
Goodwill | 1,483 | 1,472 |
Identifiable intangible assets, net of $407 and $392 in accumulated amortization, respectively | 396 | 407 |
Other long-term assets | 209 | 209 |
Total long-term assets | 4,783 | 4,639 |
Total assets | 6,348 | 6,269 |
Current liabilities | ||
Accounts payable | 505 | 521 |
Accrued expenses | 792 | 774 |
Short-term borrowings and current maturities of long-term debt | 66 | 59 |
Short-term operating lease liabilities | 110 | 107 |
Other current liabilities | 58 | 30 |
Current liabilities of discontinued operations | 15 | 16 |
Total current liabilities | 1,546 | 1,507 |
Long-term liabilities | ||
Long-term debt | 2,478 | 2,473 |
Deferred tax liability | 307 | 319 |
Employee benefit obligations | 92 | 93 |
Long-term operating lease liabilities | 606 | 606 |
Other long-term liabilities | 264 | 259 |
Total long-term liabilities | 3,747 | 3,750 |
Stockholders’ equity | ||
Common stock, $0.001 par value; 300 shares authorized; 116 and 115 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively | 0 | 0 |
Additional paid-in capital | 1,252 | 1,238 |
Retained earnings (accumulated deficit) | 10 | (4) |
Accumulated other comprehensive loss | (207) | (222) |
Total equity | 1,055 | 1,012 |
Total liabilities and equity | $ 6,348 | $ 6,269 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 48 | $ 43 |
Property and equipment, accumulated depreciation | 1,743 | 1,679 |
Identifiable intangible assets, accumulated amortization | $ 407 | $ 392 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 116,000,000 | 115,000,000 |
Common stock, shares outstanding (in shares) | 116,000,000 | 115,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 1,907 | $ 1,894 |
Salaries, wages and employee benefits | 762 | 725 |
Purchased transportation | 457 | 510 |
Fuel, operating expenses and supplies | 427 | 418 |
Operating taxes and licenses | 15 | 16 |
Insurance and claims | 44 | 56 |
Gains on sales of property and equipment | (3) | (1) |
Depreciation and amortization expense | 101 | 94 |
Transaction and integration costs | 22 | 7 |
Restructuring costs | 24 | 6 |
Operating income | 58 | 63 |
Other income | (5) | (14) |
Interest expense | 42 | 37 |
Income from continuing operations before income tax provision | 21 | 40 |
Income tax provision | 4 | 8 |
Income from continuing operations | 17 | 32 |
Income (loss) from discontinued operations, net of taxes | (3) | 456 |
Net income attributable to XPO | 14 | 488 |
Net income (loss) attributable to common shareholders | ||
Continuing operations, basic | 17 | 32 |
Discontinued operations, basic | (3) | 456 |
Net income attributable to common shareholders , basic | 14 | 488 |
Continuing operations, diluted | 17 | 32 |
Discontinued operations, diluted | (3) | 456 |
Net income attributable to common shareholders , diluted | $ 14 | $ 488 |
Earnings (loss) per share data | ||
Basic earnings per share from continuing operations (in dollars per share) | $ 0.15 | $ 0.28 |
Basic earnings (loss) per share from discontinued operations (in dollars per share) | (0.02) | 3.97 |
Basic earnings per share attributable to common shareholders (in dollars per share) | 0.13 | 4.25 |
Diluted earnings per share from continuing operations (in dollars per share) | 0.15 | 0.28 |
Diluted earnings (loss) per share from discontinued operations (in dollars per share) | (0.02) | 3.94 |
Diluted earnings per share attributable to common shareholders (in dollars per share) | $ 0.13 | $ 4.22 |
Weighted-average common shares outstanding | ||
Basic weighted-average common shares outstanding (in shares) | 116 | 115 |
Diluted weighted-average common shares outstanding (in shares) | 116 | 116 |
Restructuring, incurred cost, statement of income or comprehensive income [extensible enumeration] | Restructuring costs | Restructuring costs |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 14 | $ 488 |
Other comprehensive income (loss), net of tax | ||
Foreign currency translation gain (loss), net of tax effect of $8 and $(2) | 13 | (26) |
Unrealized gain on financial assets/liabilities designated as hedging instruments, net of tax effect of $1 and $— | 2 | 1 |
Other comprehensive income (loss) | 15 | (25) |
Comprehensive income attributable to XPO | $ 29 | $ 463 |
Defined benefit plan, net periodic benefit cost (credit), interest cost, statement of income or comprehensive income [extensible enumeration] | Other comprehensive income (loss) | Other comprehensive income (loss) |
Defined benefit plan, net periodic benefit (cost) credit, expected return (loss), statement of income or comprehensive income [extensible enumeration] | Other comprehensive income (loss) | Other comprehensive income (loss) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation loss, tax | $ 8 | $ (2) |
Unrealized gain (loss) on financial assets/liabilities designated as hedging instruments, net of tax effect | $ 1 | $ 0 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities of continuing operations | ||
Net income | $ 14 | $ 488 |
Income (loss) from discontinued operations, net of taxes | (3) | 456 |
Income from continuing operations | 17 | 32 |
Adjustments to reconcile income from continuing operations to net cash from operating activities | ||
Depreciation, amortization and net lease activity | 101 | 94 |
Stock compensation expense | 22 | 6 |
Accretion of debt | 3 | 4 |
Deferred tax expense (benefit) | (2) | 5 |
Gains on sales of property and equipment | (3) | (1) |
Other | 17 | 6 |
Changes in assets and liabilities | ||
Accounts receivable | (69) | (154) |
Other assets | (24) | (37) |
Accounts payable | (8) | 117 |
Accrued expenses and other liabilities | 22 | 116 |
Net cash provided by operating activities from continuing operations | 76 | 188 |
Cash flows from investing activities of continuing operations | ||
Payment for purchases of property and equipment | (224) | (123) |
Proceeds from sale of property and equipment | 8 | 3 |
Net cash used in investing activities from continuing operations | (216) | (120) |
Cash flows from financing activities of continuing operations | ||
Repayment of debt and finance leases | (16) | (16) |
Change in bank overdrafts | 19 | 3 |
Payment for tax withholdings for restricted shares | (12) | (12) |
Other | (1) | 1 |
Net cash used in financing activities from continuing operations | (10) | (24) |
Cash flows from discontinued operations | ||
Operating activities of discontinued operations | (8) | 13 |
Investing activities of discontinued operations | 1 | 691 |
Net cash provided by (used in) discontinued operations | (7) | 704 |
Effect of exchange rates on cash, cash equivalents and restricted cash | 2 | (3) |
Net increase (decrease) in cash, cash equivalents and restricted cash | (155) | 745 |
Cash, cash equivalents and restricted cash, beginning of period | 470 | 273 |
Cash, cash equivalents and restricted cash, end of period | 315 | 1,018 |
Less: Cash, cash equivalents and restricted cash of discontinued operations, end of period | 0 | 50 |
Cash, cash equivalents and restricted cash of continued operations, end of period | 315 | 968 |
Supplemental disclosure of cash flow information | ||
Leased assets obtained in exchange for new operating lease liabilities | 28 | 22 |
Leased assets obtained in exchange for new finance lease liabilities | 19 | 4 |
Cash paid for interest | 39 | 13 |
Cash paid for income taxes | $ 3 | $ 3 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Equity - USD ($) shares in Thousands, $ in Millions | Total | Common Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Loss |
Balance at beginning of period (in shares) at Dec. 31, 2021 | 114,737 | ||||
Balance at beginning of period at Dec. 31, 2021 | $ 1,138 | $ 0 | $ 1,179 | $ 43 | $ (84) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 488 | 488 | |||
Other comprehensive income (loss) | (25) | (25) | |||
Exercise and vesting of stock compensation awards (in shares) | 245 | ||||
Exercise and vesting of stock compensation awards | 0 | ||||
Tax withholdings related to vesting of stock compensation awards | (12) | (12) | |||
Stock compensation expense | 8 | 8 | |||
Other | 1 | 1 | |||
Balance at end of period (in shares) at Mar. 31, 2022 | 114,982 | ||||
Balance at end of period at Mar. 31, 2022 | 1,598 | $ 0 | 1,176 | 531 | (109) |
Balance at beginning of period (in shares) at Dec. 31, 2022 | 115,435 | ||||
Balance at beginning of period at Dec. 31, 2022 | 1,012 | $ 0 | 1,238 | (4) | (222) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 14 | 14 | |||
Other comprehensive income (loss) | 15 | 15 | |||
Exercise and vesting of stock compensation awards (in shares) | 315 | ||||
Exercise and vesting of stock compensation awards | 0 | ||||
Tax withholdings related to vesting of stock compensation awards | (8) | (8) | |||
Stock compensation expense | 22 | 22 | |||
Balance at end of period (in shares) at Mar. 31, 2023 | 115,750 | ||||
Balance at end of period at Mar. 31, 2023 | $ 1,055 | $ 0 | $ 1,252 | $ 10 | $ (207) |
Organization, Description of Bu
Organization, Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Description of Business and Basis of Presentation | Organization, Description of Business and Basis of Presentation XPO, Inc., together with its subsidiaries (“XPO” or “we”), is a leading provider of freight transportation services. We use our proprietary technology to move goods efficiently through our customers’ supply chains in North America and Europe. See Note 3—Segment Reporting for additional information on our operations. 2022 RXO Spin-Off and Intermodal Sale On November 1, 2022, we completed the spin-off of RXO, Inc. (“RXO”), our tech-enabled brokered transportation platform as a publicly traded company (the “RXO spin-off”). The historical results of operations and the financial positions of RXO and our intermodal operation, which was sold in March 2022, are presented as discontinued operations in our Condensed Consolidated Financial Statements. For information on our discontinued operations, see Note 2—Discontinued Operations. Basis of Presentation We prepared our Condensed Consolidated Financial Statements in accordance with U.S. generally accepted accounting principles (“GAAP”) and on the same basis as the accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). The interim reporting requirements of Form 10-Q allow certain information and note disclosures normally included in annual consolidated financial statements to be condensed or omitted. These Condensed Consolidated Financial Statements should be read in conjunction with the 2022 Form 10-K. The Condensed Consolidated Financial Statements are not audited but reflect all adjustments that are of a normal recurring nature and are necessary for a fair presentation of the 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. In the first quarter of 2023, we made certain changes to our financial reporting to increase transparency and improve comparability. Specifically, we changed the expense captions within Operating income in the Condensed Consolidated Statements of Income to reflect the nature of the expense. The change to natural expense classification had no impact on consolidated Revenues or Operating income. We have recast prior period amounts to conform to the current year’s presentation. Restricted Cash As of March 31, 2023 and December 31, 2022, our restricted cash included in Other long-term assets Trade Receivables Securitization and Factoring Programs We sell certain of our trade accounts receivable on a non-recourse basis to third-party financial institutions under factoring agreements. We also sell trade accounts receivable under a securitization program for our European transportation business. We use trade receivables securitization and factoring programs to help manage our cash flows and offset the impact of extended payment terms for some of our customers. The maximum amount of net cash proceeds available at any one time under our securitization program, inclusive of any unsecured borrowings, is €200 million (approximately $217 million as of March 31, 2023). As of March 31, 2023, the maximum amount available under the program was utilized. The weighted average interest rate was 3.41% as of March 31, 2023. In May 2023, we entered into an agreement to extend the securitization program, which was scheduled to expire in July 2024, through July 2026. The terms and conditions of the extended securitization program are materially consistent with the prior program. Information related to the trade receivables sold was as follows: Three Months Ended March 31, (In millions) 2023 2022 Securitization programs Receivables sold in period $ 440 $ 447 Cash consideration 440 447 Factoring programs Receivables sold in period 24 21 Cash consideration 24 21 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. We base our 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. The Level 1 cash equivalents include money market funds valued using quoted prices in active markets and a cash deposit for the securitization program. For information on the fair value hierarchy of our derivative instruments, see Note 6—Derivative Instruments; and for further information on financial liabilities, see Note 7—Debt. The fair value hierarchy of cash equivalents was as follows: (In millions) Carrying Value Fair Value Level 1 March 31, 2023 $ 238 $ 238 $ 238 December 31, 2022 402 402 402 Adoption of New Accounting Standard 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 rollforward 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. We adopted this standard on January 1, 2023, on a prospective basis. The adoption, which is limited to financial statement disclosures, did not have a material impact on our financial statements. In March 2020, the FASB issued ASU 2020-04, “Reference rate reform (Topic 848): Facilitation of the effects of reference rate reform on financial reporting.” The ASU provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. The amendments apply only to contracts and hedging relationships that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. The amendments are elective and |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations As discussed above, the results of RXO and intermodal are presented as discontinued operations. In addition, discontinued operations include GXO Logistics, Inc. (“GXO”), our former logistics segment that we spun off in August 2021. The following table summarizes the results of operations from discontinued operations: Three Months Ended March 31, (In millions) 2022 Revenue $ 1,645 Salaries, wages and employee benefits 164 Purchased transportation 1,221 Fuel, operating expenses and supplies 115 Operating taxes and licenses 1 Insurance and claims 9 Depreciation and amortization expense 22 Gain on sale of business (450) Transaction and other operating costs 2 Operating income 561 Income tax provision 105 Net income from discontinued operations attributable to discontinued operations $ 456 For the three months ended March 31, 2023, we incurred approximately $24 million of costs related to the RXO spin-off, of which $4 million are reflected within income (loss) from discontinued operations in our Condensed Consolidated Statements of Income. For the three months ended March 31, 2022, we incurred approximately $4 million of costs related to the GXO spin-off all of which are reflected within income from continuing operations in our Condensed Consolidated Statements of income. In accordance with a separation and distribution agreement, GXO has agreed to indemnify XPO for payments XPO makes with respect to certain self-insurance matters that were incurred by the logistics segment prior to the spin-off and remain obligations of XPO. The receivable and reserve for these matters was approximately $16 million and $15 million, respectively, as of March 31, 2023 and approximately $17 million and $16 million, respectively, as of December 31, 2022. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We are organized into two reportable segments: North American LTL, the largest component of our business, and European Transportation. In our asset-based North American LTL segment, we provide shippers with geographic density and day-definite domestic and cross-border services to the U.S., as well as Mexico, Canada and the Caribbean. Our North American LTL segment also includes the results of our trailer manufacturing operations. In our European Transportation segment, we serve a large base of customers with consumer, trade and industrial markets. We offer dedicated truckload, LTL, truck brokerage, managed transportation, last mile, freight forwarding and multimodal solutions, such as road-rail and road-short sea combinations. Corporate includes corporate headquarters costs for executive officers and certain legal and financial functions, and other costs and credits not attributed to our reportable segments. Our chief operating decision maker (“CODM”) regularly reviews financial information at the operating segment level to allocate resources to the segments and to assess their performance. We include items directly attributable to a segment, and those that can be allocated on a reasonable basis, in segment results reported to the CODM. We do not provide asset information by segment to the CODM. Our CODM evaluates segment profit (loss) based on adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), which we define as income from continuing operations before interest expense, income tax, depreciation and amortization expense, transaction and integration costs, restructuring costs and other adjustments. Segment Adjusted EBITDA has historically reflected an allocation of corporate costs. In the first quarter of 2023, we began allocating incremental corporate costs from Corporate to North American LTL. Prior periods have been recast to reflect these incremental allocations, which approximate $80 million annually. Selected financial data for our segments is as follows: Three Months Ended March 31, (in millions) 2023 2022 Revenue North American LTL $ 1,120 $ 1,107 European Transportation 787 787 Total $ 1,907 $ 1,894 Adjusted EBITDA North American LTL $ 182 $ 186 European Transportation 37 38 Corporate (9) (40) Total Adjusted EBITDA 210 184 Less: Interest expense 42 37 Income tax provision 4 8 Depreciation and amortization expense 101 94 Transaction and integration costs (1) 22 7 Restructuring costs (2) 24 6 Income from continuing operations $ 17 $ 32 Depreciation and amortization expense North American LTL $ 68 $ 56 European Transportation 32 33 Corporate 1 5 Total $ 101 $ 94 (1) Transaction and integration costs for the first quarter of 2023 are primarily comprised of stock-based compensation for certain employees related to strategic initiatives. Transaction and integration costs for the first quarter of 2022 are primarily comprised of third-party professional fees related to strategic initiatives as well as retention awards paid to certain employees. Transaction and integration costs for the three months ended March 31, 2023 and 2022 include $1 million and $2 million, respectively, related to our European Transportation segment and $21 million and $5 million, respectively, related to Corporate. (2) See Note 5— Restructuring Charges for further information on our restructuring actions. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenues Our revenue disaggregated by geographic area based on sales office location was as follows: Three Months Ended March 31, 2023 (In millions) North American LTL European Transportation Total Revenue United States $ 1,097 $ — $ 1,097 North America (excluding United States) 23 — 23 France — 340 340 United Kingdom — 224 224 Europe (excluding France and United Kingdom) — 223 223 Total $ 1,120 $ 787 $ 1,907 Three Months Ended March 31, 2022 (In millions) North American LTL European Transportation Total Revenue United States $ 1,084 $ — $ 1,084 North America (excluding United States) 23 — 23 France — 352 352 United Kingdom — 225 225 Europe (excluding France and United Kingdom) — 210 210 Total $ 1,107 $ 787 $ 1,894 |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Mar. 31, 2023 | |
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, including actions in connection with spin-offs and other divestment activities. These actions generally include severance and facility-related costs, including impairment of lease assets, as well as contract termination costs, and are intended to improve our efficiency and profitability. Our restructuring-related activity was as follows: Three Months Ended March 31, 2023 (In millions) Reserve Balance Charges Incurred Payments Foreign Exchange and Other Reserve Balance Severance North American LTL $ 2 $ — $ (1) $ — $ 1 European Transportation 1 7 (2) — 6 Corporate 19 11 (6) (1) 23 Total $ 22 $ 18 $ (9) $ (1) $ 30 In addition to the severance charges noted in the table above, we recorded a non-cash lease impairment charge of $6 million in our North American LTL segment in the first quarter of 2023. |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments In the normal course of business, we are exposed to risks arising from business operations and economic factors, including fluctuations in interest rates and foreign currencies. We use derivative instruments to manage the volatility related to these exposures. The objective of these derivative instruments is to reduce fluctuations in our earnings and cash flows associated with changes in foreign currency exchange rates and interest rates. These financial instruments are not used for trading or other speculative purposes. Historically, we have not incurred, and do not expect to incur in the future, any losses as a result of counterparty default. The fair value of our derivative instruments and the related notional amounts were as follows: March 31, 2023 Derivative Assets Derivative Liabilities (In millions) Notional Amount Balance Sheet Caption Fair Value Balance Sheet Caption Fair Value Derivatives designated as hedges Cross-currency swap agreements $ 617 Other current assets $ — Other current liabilities $ (21) Cross-currency swap agreements 57 Other long-term assets 2 Other long-term liabilities — Interest rate swaps 1,882 Other current assets — Other current liabilities — Total $ 2 $ (21) December 31, 2022 Derivative Assets Derivative Liabilities (In millions) Notional Amount Balance Sheet Caption Fair Value Balance Sheet Caption Fair Value Derivatives designated as hedges Cross-currency swap agreements $ 332 Other current assets $ — Other current liabilities $ (11) Cross-currency swap agreements 68 Other long-term assets 3 Other long-term liabilities — Interest rate swaps 1,882 Other current assets — Other current liabilities (1) Total $ 3 $ (12) The derivatives are classified as Level 2 within the fair value hierarchy. The derivatives are valued using inputs other than quoted prices, such as foreign exchange rates and yield curves. The effect of derivative and nonderivative instruments designated as hedges on our Condensed Consolidated Statements of Income was as follows: Amount of Gain (Loss) Recognized in Other Comprehensive Loss on Derivatives Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) Three Months Ended March 31, (In millions) 2023 2022 2023 2022 Derivatives designated as cash flow hedges Interest rate swaps 1 1 — — Derivatives designated as net investment hedges Cross-currency swap agreements (10) 9 2 1 Total $ (9) $ 10 $ 2 $ 1 Cross-Currency Swap Agreements We enter into cross-currency swap agreements to manage the foreign currency exchange risk related to our international operations by effectively converting our fixed-rate USD-denominated debt, including the associated interest payments, to fixed-rate, euro (“EUR”)-denominated debt. The risk management objective of these transactions is to manage foreign currency risk relating to net investments in subsidiaries denominated in foreign currencies and reduce the variability in the functional currency equivalent cash flows of this debt. During the term of the swap contracts, we will receive interest, either on a quarterly or semi-annual basis, from the counterparties based on USD fixed interest rates, and we will pay interest, also on a quarterly or semi-annual basis, to the counterparties based on EUR fixed interest rates. At maturity, we will repay the original principal amount in EUR and receive the principal amount in USD. These agreements expire at various dates through 2024. We designated these cross-currency swaps as qualifying hedging instruments and account for them as net investment hedges. We apply the simplified method of assessing the effectiveness of our net investment hedging relationships. Under this method, for each reporting period, the change in the fair value of the cross-currency swaps is initially recognized in Accumulated other comprehensive income (“AOCI”). The change in the fair value due to foreign exchange remains in AOCI and the initial component excluded from effectiveness testing will initially remain in AOCI and then will be reclassified from AOCI to Interest expense each period in a systematic manner. Cash flows related to the periodic exchange of interest payments for these net investment hedges are included in Cash flows from operating activities of continuing operations on our Condensed Consolidated Statements of Cash Flows. Interest Rate Hedging We execute short-term interest rate swaps to mitigate variability in forecasted interest payments on our Senior Secured Term Loan Credit Agreement. The interest rate swaps convert floating-rate interest payments into fixed rate interest payments. We designated the interest rate swaps as qualifying hedging instruments and account for these derivatives as cash flow hedges. The outstanding interest rate swaps mature on various dates through 2023. We record gains and losses resulting from fair value adjustments to the designated portion of interest rate swaps in AOCI and reclassify them to Interest expense on the dates that interest payments accrue. Cash flows related to the interest rate swaps are included in Cash flows from operating activities of continuing operations on our Condensed Consolidated Statements of Cash Flows. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt March 31, 2023 December 31, 2022 (In millions) Principal Balance Carrying Value Principal Balance Carrying Value Term loan facility $ 2,003 $ 1,983 $ 2,003 $ 1,981 6.25% senior notes due 2025 112 112 112 111 6.70% senior debentures due 2034 300 218 300 217 Finance leases, asset financing and other 231 231 223 223 Total debt 2,646 2,544 2,638 2,532 Short-term borrowings and current maturities of long-term debt 66 66 59 59 Long-term debt $ 2,580 $ 2,478 $ 2,579 $ 2,473 The fair value of our debt and classification in the fair value hierarchy was as follows: (In millions) Fair Value Level 1 Level 2 March 31, 2023 $ 2,616 $ 395 $ 2,221 December 31, 2022 2,601 392 2,209 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. ABL Facility As of March 31, 2023, our borrowing base and availability under our revolving loan credit agreement (the “ABL Facility”) was $502 million. Outstanding letters of credit were less than $1 million as of March 31, 2023. As of March 31, 2023, we were in compliance with the ABL Facility’s financial covenants. Letters of Credit Facility As of March 31, 2023, we had issued $154 million in aggregate face amount of letters of credit under our $200 million uncommitted secured evergreen letter of credit facility. Term Loan Facility The interest rate on our term loan facility was 6.45% as of March 31, 2023. |
Earnings (Loss) per Share
Earnings (Loss) per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) per Share | Earnings (Loss) per Share The computations of basic and diluted earnings per share were as follows: Three Months Ended March 31, (In millions, except per share data) 2023 2022 Net income from continuing operations attributable to common shares $ 17 $ 32 Net income (loss) from discontinued operations, net of amounts attributable to noncontrolling interest (3) 456 Net income attributable to common shares, basic $ 14 $ 488 Basic weighted-average common shares 116 115 Dilutive effect of stock-based awards — 1 Diluted weighted-average common shares 116 116 Basic earnings from continuing operations per share $ 0.15 $ 0.28 Basic earnings (loss) from discontinued operations per share (0.02) 3.97 Basic earnings per share $ 0.13 $ 4.25 Diluted earnings from continuing operations per share $ 0.15 $ 0.28 Diluted earnings (loss) from discontinued operations per share (0.02) 3.94 Diluted earnings per share $ 0.13 $ 4.22 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are involved, and expect to 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, insurance coverage disputes and employment-related claims, including claims involving asserted breaches of employee restrictive covenants. 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. We review and adjust accruals for loss contingencies quarterly and as additional information becomes available. 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 we deem sufficient to cover potential legal claims arising in the normal course of conducting our operations as a transportation company. 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. Insurance Contribution Litigation In April 2012, Allianz Global Risks US Insurance Company sued eighteen insurance companies in a case captioned Allianz Global Risks US Ins. Co. v. ACE Property & Casualty Ins. Co., et al., Multnomah County Circuit Court (Case No. 1204-04552). Allianz Global Risks US Ins. Co. (“Allianz”) sought contribution on environmental and product liability claims that Allianz agreed to defend and indemnify on behalf of its insured, Daimler Trucks North America (“DTNA”). Defendants had insured Freightliner’s assets, which DTNA acquired in 1981. Con-way, Freightliner’s former parent company, intervened. We acquired Con-way in 2015. Con-way and Freightliner had self-insured under fronting agreements with defendant insurers ACE, Westport, and General. Under those agreements, Con-way agreed to indemnify the fronting carriers for damages assessed under the fronting policies. Con-way’s captive insurer, Centron, was also a named defendant. After a seven-week jury trial in 2014, the jury found that Con-way and the fronting insurers never intended that the insurers defend or indemnify any claims against Freightliner. In June 2015, Allianz appealed to the Oregon Court of Appeals. In May 2019, the Oregon Court of Appeals upheld the jury verdict. In September 2019, Allianz appealed to the Oregon Supreme Court. In March 2021, the Oregon Supreme Court reversed the jury verdict, holding that it was an error to allow the jury to decide how the parties intended the fronting policies to operate, and also holding that the trial court improperly instructed the jury concerning one of the pollution exclusions at issue. In July of 2021, the matter was remanded to the trial court for further proceedings consistent with the Oregon Supreme Court’s decision. There is no date yet set for the next stages of the proceeding. The parties have filed cross-motions for summary judgment concerning the interpretation of certain of the fronting policies, which are yet to be decided. Following summary judgment, we anticipate a jury trial on the pollution exclusion, then a bench trial on allocation of defense costs among the subject insurance policies. We have accrued an immaterial amount for the potential exposure associated with Centron in the bench trial regarding allocation. As any losses that may arise in connection with the fronting policies issued by defendant insurers ACE, Westport, and General are not reasonably estimable at this time, no liability has been accrued in the accompanying interim consolidated financial statements for those potential exposures. California Environmental Matters |
Organization, Description of _2
Organization, Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation We prepared our Condensed Consolidated Financial Statements in accordance with U.S. generally accepted accounting principles (“GAAP”) and on the same basis as the accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). The interim reporting requirements of Form 10-Q allow certain information and note disclosures normally included in annual consolidated financial statements to be condensed or omitted. These Condensed Consolidated Financial Statements should be read in conjunction with the 2022 Form 10-K. The Condensed Consolidated Financial Statements are not audited but reflect all adjustments that are of a normal recurring nature and are necessary for a fair presentation of the 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. In the first quarter of 2023, we made certain changes to our financial reporting to increase transparency and improve comparability. Specifically, we changed the expense captions within Operating income in the Condensed Consolidated Statements of Income to reflect the nature of the expense. The change to natural expense classification had no impact on consolidated Revenues or Operating income. We have recast prior period amounts to conform to the current year’s presentation. |
Trade Receivables Securitization and Factoring Programs | Trade Receivables Securitization and Factoring Programs We sell certain of our trade accounts receivable on a non-recourse basis to third-party financial institutions under factoring agreements. We also sell trade accounts receivable under a securitization program for our European transportation business. We use trade receivables securitization and factoring programs to help manage our cash flows and offset the impact of extended payment terms for some of our customers. |
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. We base our 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. The Level 1 cash equivalents include money market funds valued using quoted prices in active markets and a cash deposit for the securitization program. For information on the fair value hierarchy of our derivative instruments, see Note 6—Derivative Instruments; and for further information on financial liabilities, see Note 7—Debt. |
Adoption of New Accounting Standard and Accounting Pronouncement Issued but Not Yet Effective | Adoption of New Accounting Standard 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 rollforward 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. We adopted this standard on January 1, 2023, on a prospective basis. The adoption, which is limited to financial statement disclosures, did not have a material impact on our financial statements. In March 2020, the FASB issued ASU 2020-04, “Reference rate reform (Topic 848): Facilitation of the effects of reference rate reform on financial reporting.” The ASU provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. The amendments apply only to contracts and hedging relationships that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. The amendments are elective and |
Segment Reporting | Segment Reporting We are organized into two reportable segments: North American LTL, the largest component of our business, and European Transportation. In our asset-based North American LTL segment, we provide shippers with geographic density and day-definite domestic and cross-border services to the U.S., as well as Mexico, Canada and the Caribbean. Our North American LTL segment also includes the results of our trailer manufacturing operations. In our European Transportation segment, we serve a large base of customers with consumer, trade and industrial markets. We offer dedicated truckload, LTL, truck brokerage, managed transportation, last mile, freight forwarding and multimodal solutions, such as road-rail and road-short sea combinations. Corporate includes corporate headquarters costs for executive officers and certain legal and financial functions, and other costs and credits not attributed to our reportable segments. |
Organization, Description of _3
Organization, Description of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Accounts Receivable Securitization and Factoring Programs | Information related to the trade receivables sold was as follows: Three Months Ended March 31, (In millions) 2023 2022 Securitization programs Receivables sold in period $ 440 $ 447 Cash consideration 440 447 Factoring programs Receivables sold in period 24 21 Cash consideration 24 21 |
Summary of Carrying Value and Valuation of Financial Instruments Within the Fair-Value Hierarchy | The fair value hierarchy of cash equivalents was as follows: (In millions) Carrying Value Fair Value Level 1 March 31, 2023 $ 238 $ 238 $ 238 December 31, 2022 402 402 402 (In millions) Fair Value Level 1 Level 2 March 31, 2023 $ 2,616 $ 395 $ 2,221 December 31, 2022 2,601 392 2,209 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Assets and Liabilities from Discontinued Operations | The following table summarizes the results of operations from discontinued operations: Three Months Ended March 31, (In millions) 2022 Revenue $ 1,645 Salaries, wages and employee benefits 164 Purchased transportation 1,221 Fuel, operating expenses and supplies 115 Operating taxes and licenses 1 Insurance and claims 9 Depreciation and amortization expense 22 Gain on sale of business (450) Transaction and other operating costs 2 Operating income 561 Income tax provision 105 Net income from discontinued operations attributable to discontinued operations $ 456 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Selected Financial Data for Each Reportable Segment | Selected financial data for our segments is as follows: Three Months Ended March 31, (in millions) 2023 2022 Revenue North American LTL $ 1,120 $ 1,107 European Transportation 787 787 Total $ 1,907 $ 1,894 Adjusted EBITDA North American LTL $ 182 $ 186 European Transportation 37 38 Corporate (9) (40) Total Adjusted EBITDA 210 184 Less: Interest expense 42 37 Income tax provision 4 8 Depreciation and amortization expense 101 94 Transaction and integration costs (1) 22 7 Restructuring costs (2) 24 6 Income from continuing operations $ 17 $ 32 Depreciation and amortization expense North American LTL $ 68 $ 56 European Transportation 32 33 Corporate 1 5 Total $ 101 $ 94 (1) Transaction and integration costs for the first quarter of 2023 are primarily comprised of stock-based compensation for certain employees related to strategic initiatives. Transaction and integration costs for the first quarter of 2022 are primarily comprised of third-party professional fees related to strategic initiatives as well as retention awards paid to certain employees. Transaction and integration costs for the three months ended March 31, 2023 and 2022 include $1 million and $2 million, respectively, related to our European Transportation segment and $21 million and $5 million, respectively, related to Corporate. (2) See Note 5— Restructuring Charges for further information on our restructuring actions. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenues | Our revenue disaggregated by geographic area based on sales office location was as follows: Three Months Ended March 31, 2023 (In millions) North American LTL European Transportation Total Revenue United States $ 1,097 $ — $ 1,097 North America (excluding United States) 23 — 23 France — 340 340 United Kingdom — 224 224 Europe (excluding France and United Kingdom) — 223 223 Total $ 1,120 $ 787 $ 1,907 Three Months Ended March 31, 2022 (In millions) North American LTL European Transportation Total Revenue United States $ 1,084 $ — $ 1,084 North America (excluding United States) 23 — 23 France — 352 352 United Kingdom — 225 225 Europe (excluding France and United Kingdom) — 210 210 Total $ 1,107 $ 787 $ 1,894 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring - Related Activity | Our restructuring-related activity was as follows: Three Months Ended March 31, 2023 (In millions) Reserve Balance Charges Incurred Payments Foreign Exchange and Other Reserve Balance Severance North American LTL $ 2 $ — $ (1) $ — $ 1 European Transportation 1 7 (2) — 6 Corporate 19 11 (6) (1) 23 Total $ 22 $ 18 $ (9) $ (1) $ 30 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments Measured at Fair Value in Consolidated Balance Sheet | The fair value of our derivative instruments and the related notional amounts were as follows: March 31, 2023 Derivative Assets Derivative Liabilities (In millions) Notional Amount Balance Sheet Caption Fair Value Balance Sheet Caption Fair Value Derivatives designated as hedges Cross-currency swap agreements $ 617 Other current assets $ — Other current liabilities $ (21) Cross-currency swap agreements 57 Other long-term assets 2 Other long-term liabilities — Interest rate swaps 1,882 Other current assets — Other current liabilities — Total $ 2 $ (21) December 31, 2022 Derivative Assets Derivative Liabilities (In millions) Notional Amount Balance Sheet Caption Fair Value Balance Sheet Caption Fair Value Derivatives designated as hedges Cross-currency swap agreements $ 332 Other current assets $ — Other current liabilities $ (11) Cross-currency swap agreements 68 Other long-term assets 3 Other long-term liabilities — Interest rate swaps 1,882 Other current assets — Other current liabilities (1) Total $ 3 $ (12) |
Schedule of Gains and Losses Recognized on Consolidated Statements of Operations for Derivate Instruments | The effect of derivative and nonderivative instruments designated as hedges on our Condensed Consolidated Statements of Income was as follows: Amount of Gain (Loss) Recognized in Other Comprehensive Loss on Derivatives Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) Three Months Ended March 31, (In millions) 2023 2022 2023 2022 Derivatives designated as cash flow hedges Interest rate swaps 1 1 — — Derivatives designated as net investment hedges Cross-currency swap agreements (10) 9 2 1 Total $ (9) $ 10 $ 2 $ 1 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | March 31, 2023 December 31, 2022 (In millions) Principal Balance Carrying Value Principal Balance Carrying Value Term loan facility $ 2,003 $ 1,983 $ 2,003 $ 1,981 6.25% senior notes due 2025 112 112 112 111 6.70% senior debentures due 2034 300 218 300 217 Finance leases, asset financing and other 231 231 223 223 Total debt 2,646 2,544 2,638 2,532 Short-term borrowings and current maturities of long-term debt 66 66 59 59 Long-term debt $ 2,580 $ 2,478 $ 2,579 $ 2,473 |
Schedule of Fair Value of Debt | The fair value hierarchy of cash equivalents was as follows: (In millions) Carrying Value Fair Value Level 1 March 31, 2023 $ 238 $ 238 $ 238 December 31, 2022 402 402 402 (In millions) Fair Value Level 1 Level 2 March 31, 2023 $ 2,616 $ 395 $ 2,221 December 31, 2022 2,601 392 2,209 |
Earnings (Loss) per Share (Tabl
Earnings (Loss) per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The computations of basic and diluted earnings per share were as follows: Three Months Ended March 31, (In millions, except per share data) 2023 2022 Net income from continuing operations attributable to common shares $ 17 $ 32 Net income (loss) from discontinued operations, net of amounts attributable to noncontrolling interest (3) 456 Net income attributable to common shares, basic $ 14 $ 488 Basic weighted-average common shares 116 115 Dilutive effect of stock-based awards — 1 Diluted weighted-average common shares 116 116 Basic earnings from continuing operations per share $ 0.15 $ 0.28 Basic earnings (loss) from discontinued operations per share (0.02) 3.97 Basic earnings per share $ 0.13 $ 4.25 Diluted earnings from continuing operations per share $ 0.15 $ 0.28 Diluted earnings (loss) from discontinued operations per share (0.02) 3.94 Diluted earnings per share $ 0.13 $ 4.22 |
Organization, Description of _4
Organization, Description of Business and Basis of Presentation - Narrative (Details) | Mar. 31, 2023 USD ($) | Mar. 31, 2023 EUR (€) | Dec. 31, 2022 USD ($) |
Variable Interest Entity [Line Items] | |||
Restricted cash, noncurrent, statement of financial position [extensible enumeration] | Other long-term assets | Other long-term assets | Other long-term assets |
Restricted cash included in other long-term assets | $ 6,000,000 | $ 10,000,000 | |
XPO Collections Designated Activity Company Limited | Affiliated Entity | Trade Receivables Securitization Program Two | |||
Variable Interest Entity [Line Items] | |||
Maximum borrowing capacity | $ 217,000,000 | € 200,000,000 | |
Weighted average interest rate | 3.41% | 3.41% |
Organization, Description of _5
Organization, Description of Business and Basis of Presentation - Schedule of Accounts Receivable Securitization and Factoring Programs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Securitization programs | ||
Receivables sold in period | $ 440 | $ 447 |
Cash consideration | 440 | 447 |
Factoring programs | ||
Receivables sold in period | 24 | 21 |
Cash consideration | $ 24 | $ 21 |
Organization, Description of _6
Organization, Description of Business and Basis of Presentation - Schedule of Financial Instruments Within the Fair Value Hierarchy (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 238 | $ 402 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 238 | 402 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 238 | $ 402 |
Discontinued Operations - Finan
Discontinued Operations - Financial Results from Discontinued Operations of GXO (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net income from discontinued operations attributable to discontinued operations | $ (3) | $ 456 |
Discontinued Operations | GXO | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Revenue | 1,645 | |
Salaries, wages and employee benefits | 164 | |
Purchased transportation | 1,221 | |
Fuel, operating expenses and supplies | 115 | |
Operating taxes and licenses | 1 | |
Insurance and claims | 9 | |
Depreciation and amortization expense | 22 | |
Gain on sale of business | (450) | |
Transaction and other operating costs | 2 | |
Operating income | 561 | |
Income tax provision | 105 | |
Net income from discontinued operations attributable to discontinued operations | $ 456 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income (loss) from discontinued operations, net of taxes | $ (3) | $ 456 | |
GXO | Separation and Distribution Agreements | Affiliated Entity | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Due from related parties | 16 | $ 17 | |
Self insurance reserve | 15 | $ 16 | |
Spinoff | RXO | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Incurred cost | 24 | ||
Income (loss) from discontinued operations, net of taxes | 4 | ||
Spinoff | GXO | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Incurred cost | $ 4 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | segment | 2 |
North American LTL | |
Segment Reporting Information [Line Items] | |
Incremental Corporate Costs | $ | $ 80 |
Segment Reporting - Selected Fi
Segment Reporting - Selected Financial Data for Each of Reportable Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Total | $ 1,907 | $ 1,894 |
Total Adjusted EBITDA | 210 | 184 |
Interest expense | 42 | 37 |
Income tax provision | 4 | 8 |
Depreciation and amortization expense | 101 | 94 |
Transaction and integration costs | 22 | 7 |
Restructuring costs | 24 | 6 |
Income from continuing operations | 17 | 32 |
Operating Segments | North American LTL | ||
Segment Reporting Information [Line Items] | ||
Total | 1,120 | 1,107 |
Total Adjusted EBITDA | 182 | 186 |
Depreciation and amortization expense | 68 | 56 |
Operating Segments | European Transportation | ||
Segment Reporting Information [Line Items] | ||
Total | 787 | 787 |
Total Adjusted EBITDA | 37 | 38 |
Depreciation and amortization expense | 32 | 33 |
Transaction and integration costs | 1 | 2 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Total Adjusted EBITDA | (9) | (40) |
Depreciation and amortization expense | 1 | 5 |
Transaction and integration costs | $ 21 | $ 5 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,907 | $ 1,894 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,097 | 1,084 |
North America (excluding United States) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 23 | 23 |
France | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 340 | 352 |
United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 224 | 225 |
Europe (excluding France and United Kingdom) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 223 | 210 |
North American LTL | Operating Segments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,120 | 1,107 |
North American LTL | Operating Segments | United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,097 | 1,084 |
North American LTL | Operating Segments | North America (excluding United States) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 23 | 23 |
North American LTL | Operating Segments | France | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
North American LTL | Operating Segments | United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
North American LTL | Operating Segments | Europe (excluding France and United Kingdom) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
European Transportation | Operating Segments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 787 | 787 |
European Transportation | Operating Segments | United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
European Transportation | Operating Segments | North America (excluding United States) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
European Transportation | Operating Segments | France | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 340 | 352 |
European Transportation | Operating Segments | United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 224 | 225 |
European Transportation | Operating Segments | Europe (excluding France and United Kingdom) | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 223 | $ 210 |
Restructuring Charges - Activit
Restructuring Charges - Activities (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Reserve, beginning balance | $ 22 |
Charges Incurred | 18 |
Payments | (9) |
Foreign Exchange and Other | (1) |
Reserve, ending balance | 30 |
Operating Segments | North American LTL | Severance | |
Restructuring Reserve [Roll Forward] | |
Reserve, beginning balance | 2 |
Charges Incurred | 0 |
Payments | (1) |
Foreign Exchange and Other | 0 |
Reserve, ending balance | 1 |
Operating Segments | European Transportation | Severance | |
Restructuring Reserve [Roll Forward] | |
Reserve, beginning balance | 1 |
Charges Incurred | 7 |
Payments | (2) |
Foreign Exchange and Other | 0 |
Reserve, ending balance | 6 |
Corporate | Severance | |
Restructuring Reserve [Roll Forward] | |
Reserve, beginning balance | 19 |
Charges Incurred | 11 |
Payments | (6) |
Foreign Exchange and Other | (1) |
Reserve, ending balance | $ 23 |
Restructuring Charges - Narrati
Restructuring Charges - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Operating Segments | North American LTL | |
Restructuring Cost and Reserve [Line Items] | |
Impairment charges | $ 6 |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Derivative Instruments Measured at Fair Value in Consolidated Balance Sheet (Details) - Level 2 - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 2 | $ 3 |
Derivative Liabilities | (21) | (12) |
Derivatives designated as hedges | Cross-currency swap agreements | Other Current Assets and Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 617 | 332 |
Derivatives designated as hedges | Cross-currency swap agreements | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 0 | 0 |
Derivatives designated as hedges | Cross-currency swap agreements | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | (21) | (11) |
Derivatives designated as hedges | Cross-currency swap agreements | Other Long Term Assets and Other Long Term Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 57 | 68 |
Derivatives designated as hedges | Cross-currency swap agreements | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 2 | 3 |
Derivatives designated as hedges | Cross-currency swap agreements | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 0 | 0 |
Derivatives designated as hedges | Interest rate swaps | Other Current Assets and Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 1,882 | 1,882 |
Derivatives designated as hedges | Interest rate swaps | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 0 | 0 |
Derivatives designated as hedges | Interest rate swaps | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | $ 0 | $ (1) |
Derivative Instruments - Sche_2
Derivative Instruments - Schedule of Gains and Losses Recognized on Consolidated Statements of Operations for Derivate Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Loss on Derivatives | $ (9) | $ 10 |
Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) | 2 | 1 |
Derivatives designated as hedges | Interest rate swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Loss on Derivatives | 1 | 1 |
Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) | 0 | 0 |
Derivatives designated as hedges | Cross-currency swap agreements | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Loss on Derivatives | (10) | 9 |
Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) | $ 2 | $ 1 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total debt, principal balance | $ 2,646 | $ 2,638 |
Short-term borrowings and current maturities of long-term debt, principal balance | 66 | 59 |
Long-term debt, excluding short-term borrowings and current maturities principal balance | 2,580 | 2,579 |
Long-term debt, carrying value | 2,478 | 2,473 |
Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt, carrying value | 2,478 | 2,473 |
Total debt, carrying value | 2,544 | 2,532 |
Short-term debt and current maturities of long-term debt, carrying value | 66 | 59 |
Term loan facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, principal balance | 2,003 | 2,003 |
Term loan facility | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt, carrying value | $ 1,983 | 1,981 |
6.25% senior notes due 2025 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 6.25% | |
Long-term debt, principal balance | $ 112 | 112 |
6.25% senior notes due 2025 | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt, carrying value | $ 112 | 111 |
6.70% senior debentures due 2034 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 6.70% | |
Long-term debt, principal balance | $ 300 | 300 |
6.70% senior debentures due 2034 | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt, carrying value | 218 | 217 |
Finance leases, asset financing and other | ||
Debt Instrument [Line Items] | ||
Finance leases, asset financing and other | 231 | 223 |
Finance leases, asset financing and other | Carrying Value | ||
Debt Instrument [Line Items] | ||
Finance leases, asset financing and other | $ 231 | $ 223 |
Debt - Fair Value of Debt (Deta
Debt - Fair Value of Debt (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Fair value of debt | $ 2,616 | $ 2,601 |
Level 1 | ||
Debt Instrument [Line Items] | ||
Fair value of debt | 395 | 392 |
Level 2 | ||
Debt Instrument [Line Items] | ||
Fair value of debt | $ 2,221 | $ 2,209 |
Debt - ABL Facility (Details)
Debt - ABL Facility (Details) - Revolving Credit Facility - ABL facility | Mar. 31, 2023 USD ($) |
Debt Instrument [Line Items] | |
Line of credit facility, borrowing base | $ 502,000,000 |
Remaining borrowing availability | 502,000,000 |
Outstanding letters of credit | $ 1,000,000 |
Debt - Letters of Credit Facili
Debt - Letters of Credit Facility (Details) - Uncommitted Secured Letter of Credit Facility | Mar. 31, 2023 USD ($) |
Debt Instrument [Line Items] | |
Debt instrument face amount | $ 154,000,000 |
Maximum borrowing capacity | $ 200,000,000 |
Debt - Term Loan Facility (Deta
Debt - Term Loan Facility (Details) | Mar. 31, 2023 |
Term Loan Credit Agreement | |
Debt Instrument [Line Items] | |
Annual effective interest rate | 6.45% |
Earnings (Loss) per Share (Deta
Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net income from continuing operations attributable to common shares | $ 17 | $ 32 |
Net income (loss) from discontinued operations, net of amounts attributable to noncontrolling interest | (3) | 456 |
Net income attributable to common shareholders , basic | $ 14 | $ 488 |
Basic weighted-average common shares (in shares) | 116 | 115 |
Dilutive effect of stock-based awards (in shares) | 0 | 1 |
Diluted weighted-average common shares (in shares) | 116 | 116 |
Basic earnings from continuing operations per share (in dollars per share) | $ 0.15 | $ 0.28 |
Basic earnings (loss) from discontinued operations per share (in dollars per share) | (0.02) | 3.97 |
Basic earnings per share attributable to common shareholders (in dollars per share) | 0.13 | 4.25 |
Diluted earnings from continuing operations per share (in dollars per share) | 0.15 | 0.28 |
Diluted earnings (loss) from discontinued operations per share (in dollars per share) | (0.02) | 3.94 |
Diluted earnings per share attributable to common shareholders (in dollars per share) | $ 0.13 | $ 4.22 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) | 1 Months Ended |
Apr. 30, 2012 claimant | |
Insurance Contribution Litigation | |
Loss Contingencies [Line Items] | |
Number of insurance companies | 18 |