QXO, Inc.QXO

QXO, Inc. Earnings Per Share Disclosure

10-KFiled Feb 27, 20263 min read
Earnings (Loss) Per Common Share
Basic earnings (loss) per common share is computed using the two-class method, which is an earnings allocation method that determines earnings (loss) per share for common shares and participating securities. Basic net income (loss) per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration for common share equivalents or the conversion of the Company’s Convertible Preferred Stock and Mandatory Convertible Preferred Stock. The weighted-average number of common shares outstanding used in the basic and diluted net loss per share calculation include the Pre-Funded Warrants as the Pre-Funded Warrants are exercisable at any time for nominal consideration. Common share equivalents consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock unit awards.
Diluted net income (loss) per common share is calculated by utilizing the most dilutive result of the if-converted and two-class methods. In both methods, net income (loss) attributable to common stockholders and the weighted-average common shares outstanding are adjusted to account for the impact of the assumed issuance of potential common shares that are dilutive, subject to dilution sequencing rules.
The following table presents the components and calculations of basic and diluted net income (loss) per common share attributable to common stockholders:
(in millions, except per share amounts; certain amounts may not recalculate due to rounding)
Year Ended December 31,
20252024
Basic and diluted earnings (loss) per common share computation:
Net (loss) income$(279.4)$28.0 
Less: Convertible Preferred Stock dividend
(90.0)(51.0)
Less: Mandatory Convertible Preferred Stock dividend
(18.9)— 
Less: Undistributed earnings allocated to participating securities— — 
Loss attributable to common shareholders
$(388.3)$(23.0)
Weighted-average common shares571.0 185.0 
Weighted-average Pre-Funded Warrants
42.0 19.0 
Total weighted-average common shares outstanding613.0 204.0 
Basic and diluted loss per common share
$(0.63)$(0.11)
Subsequent to the year ended December 31, 2025, the Company sold 31.6 million shares of the Company’s common stock in an underwritten public offering, the impact of which was not included in the computation of diluted net income (loss) per common share.
The following table includes the number of shares that may be dilutive common shares in the future. These shares were not included in the computation of diluted net income (loss) per common share because the effect was either anti-dilutive or the requisite performance conditions were not met:
Year Ended December 31,
(in millions)
20252024
Convertible Preferred Stock
219.0 219.0 
Mandatory Convertible Preferred Stock
32.7 — 
Warrants
219.0 219.0 
Stock-based awards
26.2 21.9 
Total potential dilutive securities not included in loss per common share
496.9 459.9 
Subsequent to the year ended December 31, 2025, the Company received commitments from investors for investing up to $3.0 billion for the issuance of up to 300,000 shares of Series C Preferred Stock with a stated value of $10,000 per share contingent on a Qualifying Acquisition, the issuance of which may result in dilutive common shares in the future. If issued, the stated value of the Series C Preferred Stock will be, at the option of the holders, convertible into the Company’s common stock at an initial conversion price of $23.25 per share.

Historical Timeline

Fiscal YearFiled
2025Feb 27, 2026Showing above
2024Mar 4, 2025

About Earnings Per Share Disclosures

The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.

Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.

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