FedEx announced Tuesday that its earnings for the fiscal fourth quarter surpassed Wall Street’s expectations for both revenue and profit. The reporting period, ending May 31, marks the final quarter that includes the company’s freight business, which was spun off into a separate entity, FedEx Freight, on June 1.
In connection with the spinoff, FedEx Freight provided FedEx Corporation with a cash dividend of approximately $4.1 billion. Despite the strong earnings, shares of FedEx experienced a decline of about 6% in extended trading following the announcement.
Financial Performance Highlights
For the fiscal fourth quarter, FedEx reported adjusted earnings per share of $6.31, exceeding the $5.96 anticipated by analysts. Revenue for the quarter reached $25.01 billion, surpassing the expected $24.04 billion. The company’s Express segment specifically reported revenue of $21.57 billion, outperforming StreetAccount estimates of $20.75 billion. Domestic volume saw a 3% year-over-year increase, with U.S. priority volume also rising by 3%.
The company’s reported net income for the fourth fiscal quarter was $1.6 billion, or $6.60 per share. This compares to $1.65 billion, or $6.88 per share, recorded in the same period a year earlier. After adjusting for one-time costs, including those related to the spinoff and retirement plan adjustments, the reported earnings per share stood at $6.31.
Full-Year Results and Future Outlook
For the complete fiscal year, FedEx generated $94.7 billion in revenue, an increase from $87.9 billion in the prior year. CEO Raj Subramaniam stated that the current business momentum validates the company’s strategy, leading to favorable financial outcomes such as strong free cash flow and fiscal year 2026 results that significantly exceeded initial projections.
FedEx also announced a change in its fiscal year end, moving it from May 31 to December 31, effective earlier this month. Looking ahead, the company forecasts 11% year-over-year revenue growth for the full year and projects adjusted diluted earnings per share to be in the range of $16.90 to $18.10.
Operational Costs and Pricing
Fuel costs for FedEx saw a substantial increase, rising 66% from $864 million in the previous year to $1.43 billion in the current period. However, company executives indicated on a call with analysts that these fuel price increases have not impacted demand. Additionally, the company reported a 10% rise in U.S. pricing.
Mitchell Landsberg is the senior reporter for News Raise and focuses on Technology. Mitchell regularly writes about social media platforms and how influencers, industry and general people use them to communicate and make money.
