FedEx Announces Strong Fiscal 2025 Profit Forecast
FedEx recently announced its fiscal 2025 profit forecast, surpassing analysts’ expectations and sparking optimism among investors. The company is anticipating that planned cost reductions in the upcoming year will lead to margin gains, despite continuing challenges in revenue due to lackluster demand for parcel shipping.
Shares of FedEx soared 15.3% in extended trading following the announcement, reaching $295.49. The delivery company has set its sights on fiscal 2025 earnings of $20 to $22 per share, with the midpoint exceeding analysts’ estimate of $20.92. This news helped alleviate concerns that gains from cost-cutting measures and operational mergers were diminishing.
In the fourth quarter that ended on May 31, FedEx reported earnings excluding items of $1.34 billion, or $5.41 per share, up from $1.25 billion, or $4.94 per share, the previous year. The operating margin also saw improvement, climbing to 8.5% from 8.1%.
FedEx CEO Raj Subramaniam expressed confidence in the company’s performance, stating, “These results are unprecedented in this current environment. We expect this momentum to continue in fiscal 2025.”
Despite the challenges faced in the market, FedEx shares have seen a 12-month gain of 10%, in stark contrast to a 20% decline for rival United Parcel Service.
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