Fedex Corp

Q3 Financial Performance: FedEx reported a 2% increase in revenue year-over-year for Q3, marking the first revenue growth this fiscal year. Adjusted operating income rose by 12%, driven by $600 million in DRIVE savings, despite challenges from the expiration of the USPS contract and adverse weather events. The company showed 17% adjusted operating income growth for Federal Express, although FedEx Freight faced a 5% revenue decline due to lower volumes and weights.

Adjusted EPS Outlook Lowered: For FY '25, FedEx revised its adjusted earnings per share (EPS) guidance down to $18 to $18.60, from a previously expected range of $19 to $20. This reflects increased inflationary pressures, economic uncertainty, and challenges in B2B demand, particularly in freight services, as well as headwinds from the USPS contract expiration.

Operational Initiatives: The company continues to implement its DRIVE program, expecting to achieve incremental savings of $2.2 billion for FY '25. Network 2.0 initiatives are on track, with 12% of daily global volume expected to flow through optimized facilities by FY '25's end. Such efforts are intended to improve efficiency and reduce costs in the long term.