🎣 Port Strike Suspended
Plus, Flexport announces more layoffs, Hurricane Helene continues to disrupt key lanes, and experts predict truckload carrier rate increase for 2025.
FedEx (NYSE:FDX) experienced a significant 10% drop in its stock price, following a disappointing Q2 earnings report and a downward revision in its revenue forecast. This decline reflects broader challenges within the logistics industry, particularly in the face of a weaker holiday season.
Key Financials:
CEO's Perspective:
Despite the revenue miss, CEO Raj Subramaniam emphasized the company's operational growth and margin expansion amidst challenging demand conditions. However, FedEx's outlook remains cautious, with expectations of a low-single-digit percentage decline in revenue year-over-year for fiscal 2024. The anticipated EPS for 2024 is now set between $17.00 and $18.50, compared to the previous consensus estimate of $18.25.
Market Reaction:
The announcement led to an 8.5% decline in FedEx's shares in extended trading, also negatively impacting shares of its rival, United Parcel Service (UPS), which fell by 2.6%. The market's reaction underscores concerns about the delivery industry's performance during the critical holiday shipping season.
Cost-Cutting and Efficiency:
FedEx is focusing on cost-cutting measures and operational efficiency. Plans include combining its Express and Ground delivery units and repurchasing an additional $1 billion of common stock during fiscal 2024. These strategies aim to mitigate the impact of reduced revenue and maintain profitability.
Sources: Investing.com | The Sun/Reuters
Join over 11K+ subscribers to get the latest freight news and entertainment directly in your inbox for free. Subscribe & be sure to check your inbox to confirm (and your spam folder just in case).