Company: QXO-PB
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-050298
Chunk: 197

Company: QXO, Inc.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 197
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 The comparative increase in interest expense was primarily due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition, resulting in higher interest expense. The increase was also driven by lower interest income due to a lower average interest-bearing cash balance during the three months ended September 30, 2025.

Interest (expense) income, net was $(11.3) million for the nine months ended September 30, 2025, compared to $60.4 million for the nine months ended September 30, 2024. The comparative increase in interest expense was primarily due to additional debt that was issued by QXO Building Products in connection with the Beacon Acquisition, resulting in higher interest expense. The increase in interest expense was partially offset by higher interest income due to a higher average interest-bearing cash balance during the nine months ended September 30, 2025.

Loss on Debt Extinguishment

Loss on debt extinguishment was $45.7 million for the nine months ended September 30, 2025 due to the principal prepayment of $1.40 billion under the Term Loan Facility and includes the pro-rata extinguishment of previously capitalized original issue discounts and debt issuance costs.

Income Taxes

The Company’s interim provision for income taxes is determined based on its annual estimated effective tax rate, applied to the actual year-to-date income, and adjusted for the tax effects of any discrete items. The Company’s effective tax rate for the nine months ended September 30, 2025, excluding discrete items, was 14.1%, compared to 25.9% for the nine months ended September 30, 2024. The Company’s effective tax rates for the nine months ended September 30, 2025 and 2024 were based on the U.S. federal statutory tax rate of 21% and state jurisdictional income tax rates, adjusted for permanent items including compensation above $1 million, inclusive of equity awards, paid to covered employees under Internal Revenue Code Section 162(m) and non-deductible transaction costs due to the Beacon Acquisition, coupled with the pre-tax loss during the nine months ended September 30, 2025.

Benefits for income taxes consists of federal and state taxes in the United States and income in certain foreign jurisdictions, as well as deferred income taxes and changes in valuation allowance, reflecting net tax effects of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Realization of our deferred tax assets