Roll-ups are supposed to buy margin. This one is buying revenue and giving margin back.
QXO, Inc. reported second-quarter net sales of $3.246 billion on August 13, up from $1.906 billion a year earlier. That’s 70 percent growth, and almost none of it is organic. Adjusted EBITDA rose to $272 million from $204 million. Adjusted EBITDA margin fell to 8.4 percent from 10.7 percent, and adjusted gross margin slipped to 24.7 percent from 25.3 percent.
The mix is moving off roofing
Residential roofing came in at $1.266 billion, or 39.0 percent of sales, down from 48.7 percent. Non-residential roofing was $736 million, 22.7 percent, down from 28.1 percent. Complementary building products jumped to $1.229 billion and 37.9 percent, up from 22.4 percent.
That shift is Kodiak Building Partners, which closed April 1 and contributed $595 million in the quarter. TopBuild closed July 1, after quarter-end, so its insulation business isn’t in any of these figures. Q3 will look different again.
“Following the completion of the TopBuild acquisition on July 1, QXO is the second-largest publicly traded building products distributor in North America,” said Brad Jacobs, chairman and CEO. “We are focused on our plan to more than double EBITDA by 2030 and reach $50 billion in revenue within the decade.”
Debt is the number to watch
Long-term debt stood at $6.029 billion at June 30 against $3.057 billion at the end of 2025. Of that, $3.0 billion sat in escrow from two note issues, 6.500 percent notes due 2031 and 6.875 percent notes due 2034, held pending the TopBuild close. Total assets were $22.665 billion.
Net loss for the quarter was $55 million, or 14 cents a share, versus a $59 million loss a year prior. Six-month net loss widened to $282 million from $50 million. The quarter carried $52 million of acquisition costs, $24 million of transformation costs and $8 million of restructuring, so $84 million of add-backs sit inside that $272 million of adjusted EBITDA.
What it means for buyers
A distributor carrying $6 billion of debt at 6.5 to 6.9 percent while missing its own margin trajectory has two levers: cut cost out of the acquired businesses, or hold price. Integration savings take years. Price holds are available next quarter.
Contractors buying roofing, lumber, insulation and complementary products from the QXO family should expect the margin conversation to move, and should be reading their own supplier concentration. Beacon Roofing Supply, Kodiak and TopBuild are no longer independent counterparties, and the domains for two of them now redirect to QXO transition pages. If your bid relied on three quotes and two of them are now the same company, that’s a pricing risk rather than a coverage strategy.
Large-volume material buyers on conversion projects feel this first. A job like the 111 Wall Street residential conversion, where 1,568 units of interior fit-out ride on insulation, board and finishes, is exactly the kind of package where consolidated distribution shows up in the number.
One caveat on the superlatives. Largest insulation distributor, largest waterproofing distributor and second-largest publicly traded distributor are all QXO’s own descriptions. The Kodiak purchase price that circulates at $2.25 billion is not in the earnings release.