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  1. FedEx shares gain 14% in after-hours trading on upbeat guidance for fiscal year 2025

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FedEx shares gain 14% in after-hours trading on upbeat guidance for fiscal year 2025

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2 min read | Updated on June 26, 2024, 07:27 IST

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SUMMARY

For the fiscal year 2025, FedEx said it expects a low-to-mid single-digit percent revenue growth year over year and permanent cost reductions from the DRIVE transformation program of $2.2 billion. The company expects earnings per diluted share of $18.25 to $20.25 before the MTM retirement plans accounting adjustments and $20 to $22 after also excluding costs related to business optimisation initiatives.

FedEx shares gain 14% in after-hours trading on upbeat guidance for fiscal year 2025

FedEx shares gain 14% in after-hours trading on upbeat guidance for fiscal year 2025

FedEx Corporation’s shares surged nearly 14% in after-hours trading after the firm announced a higher-than-expected guidance for the fiscal year 2025 driven by its cost-cutting initiatives. The firm also stated that its board is conducting an assessment of the role of FedEx Freight in the company’s portfolio structure.

For the fiscal year 2025, the firm said it expects a low-to-mid single-digit percent revenue growth year over year and permanent cost reductions from the DRIVE transformation program of $2.2 billion. The firm expects earnings per diluted share of $18.25 to $20.25 before the MTM retirement plans accounting adjustments and $20 to $22 after also excluding costs related to business optimisation initiatives.

For the quarter ending on May 31, 2024, FedEx reported a 4.5% year-on-year (YoY) decline in its reported net profit at $1.47 billion. The company’s total revenue was up 0.9% YoY to $22.1 billion while the operating income for the quarter rose 4% YoY to $1.56 billion.

For the full fiscal year ending on May 31, 2024, the company’s net profit jumped 9% YoY to $4.33 billion. The total revenue for the year was down 2.77% YoY to $87.7 billion while the operating income rose 13.23% YoY to $5.56 billion. The company’s diluted earnings per share (EPS) was up 11% YoY for the year at $17.21.

Raj Subramaniam, president and chief executive officer of FedEx Corporation said the firm made significant progress in fiscal 2024 and ended the year strong, delivering four consecutive quarters of expanding operating income and margin in a challenging revenue environment. “These results are unprecedented in this current environment, reflecting our continued execution of our DRIVE initiatives and our resolve to transform FedEx while we deliver outstanding service to our customers. We expect this momentum to continue in fiscal 2025 as we advance our efforts to create the world’s most flexible, efficient, and intelligent network,” he said.

Shares of the company have risen over 1.6% since the beginning of the year. The stock has gained over 9% in the last one year.

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