Shares in FedEx (NYSE: FDX) fell more than 9% in pre-market trading on Friday after the parcel delivery giant lowered its full-year profit and revenue guidance.
In a statement, Chief Financial Officer John Dietrich attributed the downgrade to “continued weakness and uncertainty in the U.S. industrial economy,” which has dampened demand for its business-to-business services.
The downgrade comes amid growing concerns that the industrial sector—which includes firms that make products used to manufacture other items and is a key driver of FedEx deliveries activity—could be impacted by President Donald Trump’s tariff plans.
Chief Executive Officer Raj Subramaniam cautioned that the operating environment was “very challenging,” pointing to “a compressed peak season and severe weather events” as additional pressures on the business.
FedEx (NYSE: FDX) now expects adjusted earnings per share for the fiscal year ending May 2025 to range between $18 and $18.60, down from its prior guidance of $19 to $20. This marks the second revision this year, as the company initially projected earnings of $20 to $22 per share. Revenue is also projected to be flat to slightly lower year-over-year, a shift from an earlier estimate of approximately flat growth.
The updated guidance follows FedEx’s third-quarter results, released Thursday, which showed adjusted earnings per share of $4.51 on revenue of $22.2 billion. Analysts surveyed by Investing.com had expected earnings of $4.61 per share on revenue of $21.92 billion, indicating a slight earnings miss despite topping revenue forecasts.
FedEx flagged its Freight segment as a weak spot, with operating results hit by lower fuel surcharges, lighter shipments, and reduced delivery volumes. Higher base yields offered some relief, but not enough to offset the declines.
In a note to clients, Barclays said,
“[The] [l]owered fourth quarter outlook feeds negative market narrative on slower macro growth in 2025 given U.S. tariff uncertainty; nonetheless, with the Freight spin on track by mid next year, the continued merger of Express and Ground networks as well as pricing gains support a favorable long-term outlook.”
Kevin Putnam is a financial journalist and editor based in New York. He specializes in editing news and analysis related to U.S. stock market. Read Full Bio
