Key Points:
- FedEx beat Q1 estimates with $910M net income.
- Revenue hit $22.24B; U.S. volumes rose 6%.
- FY26 outlook: 4–6% growth, EPS $17.20–$19.00.
FedEx stock rise more than 5% in after-hours trading on Thursday after the package delivery giant reported fiscal first-quarter results that exceeded Wall Street expectations on both earnings and revenue.
The company posted adjusted earnings per share of $3.83, compared with analyst estimates of $3.59, and revenue of $22.24 billion against a forecast of $21.66 billion. FedEx said the performance reflected both improved domestic volumes and ongoing cost-management strategies.
First-Quarter Performance Exceeds Market Forecasts
For the quarter ending August 31, FedEx stock reflected strong performance as the company reported net income of $820 million, or $3.46 per share, up from $790 million, or $3.21 per share, a year earlier. Adjusted for restructuring costs and the planned FedEx Freight spin-off, net income rose to $910 million, or $3.83 per share.
The company’s U.S. average daily volumes increased 6%, driven by higher demand for domestic package services. FedEx said operating results in most segments improved, though its FedEx Freight unit experienced pressure from lower revenue and rising wage expenses.
Analysts had anticipated earnings of $3.64 per share on sales of $21.7 billion, according to data from LSEG. The company’s results not only outpaced these estimates but also demonstrated resilience amid a shifting global trade environment.
Chief Executive Officer Raj Subramaniam told analysts that FedEx’s performance highlighted the adaptability of its network. “Our results demonstrate the resilience we have built into our system and the commitment of our world-class team,” Subramaniam said.
Outlook Highlights Growth and Transformation Strategy
Looking ahead, FedEx stock reflects the company’s projected revenue growth of 4% to 6% for fiscal year 2026, compared with Wall Street expectations of just over 1%. The company anticipates full-year earnings per share in the range of $17.20 to $19.00, with a midpoint estimate of $18.10. That outlook is broadly in line with analysts’ consensus of $18.21.
Subramaniam noted that while external factors continue to create challenges, FedEx is well-positioned to adapt. The company said it had faced about $150 million in headwinds related to trade dynamics during the quarter, though it managed to offset much of the impact through operational flexibility.
FedEx also confirmed progress on its planned spin-off of FedEx Freight, which will become a standalone publicly traded company by June 2026. Executives said the separation will allow both companies to sharpen their focus and improve long-term shareholder value.
The company highlighted the scale of its operations, moving more than 17 million packages per day through its global network. Recent adjustments, such as higher shipping fees to account for changing cost conditions, were introduced to maintain service quality and efficiency.
FedEx Maintains Focus on Long-Term Efficiency
Despite global uncertainty, FedEx stock reflects the company’s commitment to enhancing the customer experience, managing costs, and improving productivity across its operations. Company leaders said their strategy is designed to balance short-term challenges with long-term opportunities in e-commerce and international logistics.
“Adaptability is at the heart of our business model,” Subramaniam said. “We continue to execute on our transformation plans while maintaining high standards of service for customers around the world.”
FedEx executives reiterated that while certain segments face pressure, particularly in freight, the company’s diversified operations provide stability. Management said strong growth in package volumes and disciplined financial planning would support continued performance in fiscal 2026.
FedEx stock rose following the company’s strong quarterly results, upbeat guidance, and progress toward strategic changes contributed to Thursday’s share price increase, underlining investor confidence in FedEx’s ability to navigate a complex operating environment.
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