FedEx Cuts Guidance Amid Trade and Demand Worries
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FedEx Corp. forecast a worse-than-expected profit for the current quarter in a sign that soft demand from consumers and businesses rattled by tariffs is unlikely to improve in the near term.
Adjusted earnings in its fiscal first quarter will be $3.40 to $4 a share, . The range fell below the $4.03 average of analyst estimates compiled by Bloomberg.
Although it typically provides a full-year forecast, FedEx said it would only share its outlook for the current quarter due to the “uncertain global demand environment.” The forecast reflects FedEx’s current economic outlook and assumes no further negative developments in the global trade, economic and geopolitical environment, the company said.
President Donald Trump’s erratic trade policies continue to weigh on consumers and businesses alike. Analysts had reduced their 2026 profit estimates for FedEx in recent months, worried that weakening consumer confidence and soft industrial demand would swamp improvements from a sweeping effort to slash costs and revamp its delivery network.
FedEx’s shares fell 5.2% at 4:22 p.m. during after-hours trading in New York. The stock declined 18% this year through close June 24, worse than the 3.6% gain by the S&P 500 index.
Still, there are signs that the company’s long-running push to slash expenses and combine FedEx’s ground and air shipping networks into a single operation is paying off. The company achieved its goal of cutting $2.2 billion in costs during its most recent fiscal year and expects an additional $1 billion in savings this year.
Adjusted earnings were $6.07 a share in the fourth quarter, topping the $5.81 average of analyst estimates compiled by Bloomberg. Higher U.S. and international export volumes, price increases and cost reductions provided a boost, while the expiration of its U.S. Postal Service contract along with higher transportation and wage expenses weighed on results, the company said.
The earnings report comes just days after the death of Fred Smith, FedEx’s iconic founder who revolutionized the parcel shipping business by introducing next-day air service after he started the company in 1971.
“Fred pioneered express delivery and connected the world, shaping global commerce as we know it,” CEO Raj Subramaniam said in the statement.
FedEx ranks No. 2 on the Transport Topics Top 100 list of the largest for-hire carriers, No. 2 on the TT Top 50 list of the largest global freight carriers and No. 43 on the TT Top 100 list of the largest logistics companies in North America.
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