The holidays are an important time for the companies that are responsible for shipping goods from place to place, and that's become even more important ever since online shopping became such a high-growth part of the business. XPO Logistics (NYSE:XPO) has embraced the e-commerce revolution, and it's aimed to tap into the strong economic conditions that many of its key markets are experiencing right now.

Coming into Wednesday's fourth-quarter financial report, XPO investors were looking for ambitious gains for the logistics company, but even bullish shareholders were somewhat surprised by just how well XPO did. Let's take a closer look at XPO Logistics and what its latest results say about its prospects.

White semi tractor-trailer with XPO logo on it, driving down a four-lane highway.

Image source: XPO Logistics.

XPO Logistics puts a bow on its results

XPO Logistics' fourth-quarter results highlighted the company's success in tapping into e-commerce growth. Sales jumped 14% to $4.19 billion, and that was more than double the 6% growth rate that most of those following the stock had expected. Tax reform benefits sent GAAP net income soaring, but even after accounting for those gains, adjusted net income nearly doubled from year-ago levels to $59.2 million. That resulted in adjusted earnings of $0.45 per share, outpacing the $0.43 per share consensus forecast among investors.

Tax reform laws gave XPO a big one-time boost. The company said that tax-related benefits added up to almost $170 million, and even after subtracting some offsetting charges in other areas, GAAP earnings would have been almost $1 per share higher than the adjusted number XPO reported.

XPO's transportation segment had particularly strong performance. Segment revenue was up by 15% to $2.67 billion, with increases in North American freight brokerage and last-mile services contributing the most to the gains. European brokerage and U.K. truckload business were also positive contributors to performance. Operating income jumped by more than half for the period, with North America, France, and Spain being the primary hubs for improved profitability.

Gains for logistics were only slightly weaker at 14%. Contract logistics were in demand across XPO's coverage area, but managed transportation revenue in North America offset some of the increase. Operating income climbed about 18%.

CEO Brad Jacobs celebrated the holiday season. "A strong holiday peak played directly to our strengths in e-commerce," Jacobs said, and the CEO noted better margin figures in helping to improve operating ratios and keep more of its revenue as profit.

Can XPO keep delivering in 2018?

XPO is optimistic about what's to come in the next year. As Jacobs put it, "We've entered 2018 with a global sales pipeline of $3.2 billion, following a record $2.8 billion of new business signed in 2017." XPO intends to invest some of its ample free cash flow toward growing its business through spending on technology and salesforce improvements.

With respect to guidance, XPO made a minor upward adjustment to one of its key numbers. The company still expects to bring in $1.6 billion in adjusted pre-tax operating earnings in 2018, matching its previous guidance. But the company raised its free cash flow target by $100 million to an even $1 billion, showing the extent to which favorable tax moves and some other good conditions could help XPO's liquidity situation.

The big question for XPO is whether the company will remain independent. On a couple of occasions recently, XPO shares have spiked higher on rumors that the logistics specialist might become the target of a takeover bid. So far, no bid has come out, but that isn't stopping shareholders from placing their bets that a future move could come.

XPO investors didn't have much of a response to the news, and the stock remained close to unchanged in after-hours trading following the announcement. As long as the e-commerce revolution continues to move forward, XPO Logistics is likely to continue making the most of the positive trend and looking for ways to deliver the goods its customers want moved quickly and efficiently.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.