new york: FedEx lowered its full-year sales forecast on Tuesday (Dec. 19), and on Tuesday (Dec. 19) reported quarterly profit that was well below analysts’ expectations, marking what is shaping up to be a weak holiday shopping season. Shares fell 8.5% as the company competed for business.
The company’s shares closed at US$280 (RM1,310) on Tuesday before falling to US$256.20 in extended trading. The result also pushed rival United Parcel Service’s stock price down 2.6%.
FedEx announced that adjusted earnings for the quarter ended Nov. 30 rose 23% to $1.01 billion, or $3.99 per diluted share. However, the results were 19 cents per share below analysts’ expectations, according to LSEG data.
The holiday shipping season, from late November to the end of December, is typically the best quarter for shipping companies, as volumes double on the busiest days. FedEx’s results add to data suggesting a lackluster “peak” holiday season this year as consumers face inflation and rising costs for housing, food and other necessities. It became.
“We expect our revenues to continue to be compressed by volatile macroeconomic conditions that are negatively impacting customer demand for our services across our carriers,” the company said in a regulatory filing. said in a regulatory filing.
FedEx now expects revenue to decline by a low-single digit percentage from last year, compared with previous expectations of roughly flat performance.
As FedEx and UPS compete for all the packages they need to keep their trucks and planes running efficiently, retailers and other customers have had the most success winning lower delivery rates in years. There is.
FedEx has poached UPS customers before a contract covering 340,000 employees of rival company United Brotherhood of Teamsters expires on August 1st.
Shipping consultants told Reuters that UPS has been fighting to regain business, including paying early termination fees to customers who switched to FedEx during negotiations.
Nevertheless, FedEx expects to continue cutting costs and protect profits by consolidating separate express delivery and ground transportation units.
FedEx also said it plans to repurchase an additional $1 billion of common stock during fiscal 2024. – Reuters
