Shares of FedEx (FDX) are up 15% after the shipping and logistics company reported financial results that beat Wall Street forecasts and raised its forward guidance.
The company announced earnings per share (EPS) of $5.41 U.S. versus $5.35 U.S. that was expected among analysts.
Revenue in what was the company’s fiscal fourth quarter totaled $22.11 billion U.S. compared to $22.07 billion U.S. that was estimated.
For the full fiscal year, FedEx’s revenue amounted to $87.7 billion U.S., down 3% from $90.2 billion U.S. a year earlier.
FedEx reported that its capital expenditures during fiscal 2024 totaled $5.2 billion U.S., down 16% from $6.2 billion U.S. in fiscal 2023.
The capital spending decline comes as the company focuses on cost-cutting measures as part of a plan to save $4 billion U.S. by the end of the current 2025 fiscal year.
In terms of guidance, FedEx management raised their outlook for fiscal 2025, saying they expect low to mid-single-digit revenue growth driven by e-commerce and low-inventory levels.
In April of this year, FedEx lost its long-standing contract with the U.S. Postal Service to rival United Parcel Service (UPS).
UPS will become the primary air cargo provider for the Postal Service on September 30 of this year after FedEx’s current contract expires.
The loss of the Postal Service contract could cost FedEx $500 million U.S. in revenue this fiscal year, said company executives on an earnings call with analysts and investors.
Earlier in June, FedEx raised its quarterly dividend payment to shareholders by 10%, taking the distribution to $1.38 U.S. per share and giving the stock a yield of 2.15%.
Prior to today (June 26), FedEx’s stock was up 2% this year and trading at $256.38 U.S. per share.
