FedEx Earnings: Two Straight Quarters of Falling Profit

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S&P 500 (NYSE:SPY) component FedEx Corporation (NYSE:FDX) reported its results for the first quarter. FedEx provides various transportation, e-commerce and business services.

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FedEx Corporation Earnings Cheat Sheet

Results: Net income for FedEx Corporation fell to $459 million ($1.45 per share) vs. $464 million ($1.46 per share) a year earlier. This is a decline of 1.1% from the year-earlier quarter.

Revenue: Rose 2.6% to $10.79 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: FedEx Corporation fell short of the mean analyst estimate of $1.58 per share. It fell short of the average revenue estimate of $11.13 billion.

Quoting Management: As we announced on September 4, weakness in the global economy constrained revenue growth at FedEx Express during our first quarter and affected our earnings,” said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. “Meanwhile, our FedEx Ground and FedEx Freight segments performed well, with both improving their year-over-year operating margins. We are taking further actions to reduce costs and adjust our networks to match current and anticipated shipment volumes.”

Key Stats:

Revenue has increased for four consecutive quarters. Revenue increased 4.3% to $11.01 billion in the fourth quarter of the last fiscal year. The figure rose 9.3% in the third quarter of the last fiscal year from the year earlier and climbed 9.9% in the second quarter of the last fiscal year from the year-ago quarter.

The company’s net income has fallen in each of the last two quarters. In the fourth quarter of the last fiscal year, net income fell 1.4% from the year-earlier quarter.

The company fell short of forecasts after beating estimates in the previous two quarters. In the fourth quarter of the last fiscal year, it topped the mark by 7 cents, and in the third quarter of the last fiscal year, it was ahead by 19 cents.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the second quarter is $1.79 per share, a drop from $1.85. Over the past sixty days, the average estimate for the fiscal year has reached $7.36 per share, a decline from $7.46.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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