NYSE$FDX

FedEx Corporation · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

FedEx's Q3 2023 earnings were impacted by demand weakness, partially offset by U.S. domestic yield improvement and cost-reduction actions, resulting in an improved outlook for the fiscal year.

FedEx Corp. reported consolidated results for the third quarter ended February 28, 2023. The company's performance was affected by continued demand weakness, particularly at FedEx Express, and global inflation, which was partially offset by U.S. domestic yield improvement and cost-reduction actions. Despite these challenges, FedEx increased its earnings forecast for the fiscal year.

  • FedEx team delivered outstanding service during peak season while making progress on transformation initiatives.
  • Cost actions are taking hold, driving an improved outlook for the current fiscal year.
  • FedEx Ground operating results improved due to an 11% increase in revenue per package and cost-reduction actions.
  • FedEx Freight operating results improved, driven by an 11% increase in revenue per shipment and a gain on the sale of a facility.

Headline financials

Total Revenue

$22.2B

Previous: $23.6B-6.2%
EPS (adj)

$3.41

Previous: $4.59-25.7%
Free Cash Flow

$771M

Previous: $1.11B-30.7%
Net Income

$771M

Previous: $1.11B-30.7%
Operating Income

$1.04B

Previous: $1.33B-21.4%
Gross Profit

-$2.14B

Previous: -$2.02B-5.7%
Cash & Equivalents

$5.37B

Previous: $6.07B-11.4%
Total Assets

$85.8B

Previous: $84.1B+2.0%
Stock-Based Comp

$34M

Previous: $39M-12.8%

Revenue & EPS history

FedEx · Revenue · Quarterly

$22.2B

Q3 2023-6.2%vs Q3 2022
Beat estimate in 7 of 15 quarters(47%)
ActualEstimate

Forward guidance

FedEx is increasing its earnings forecast for the fiscal year.

Tailwinds

  • Earnings per diluted share of $13.80 to $14.40 before the MTM retirement plans accounting adjustments, compared to the prior forecast of $12.50 to $13.50 per diluted share
  • Earnings per diluted share of $14.60 to $15.20 before the MTM retirement plans accounting adjustments and excluding estimated costs related to business optimization initiatives and costs related to business realignment activities, compared to the prior forecast of $13.00 to $14.00 per diluted share
  • ETR of 25% to 26% prior to the MTM retirement plans accounting adjustments
  • Capital spending of $5.9 billion.
  • We are building momentum through our cost and efficiency initiatives to improve profitability

Headwinds

  • FedEx is unable to forecast the fiscal 2023 mark-to-market (MTM) retirement plans accounting adjustments.
  • FedEx is unable to provide a fiscal 2023 earnings per share or effective tax rate (ETR) outlook on a GAAP basis
  • It is reasonably possible that the fiscal 2023 MTM retirement plans accounting adjustments could have a material effect on fiscal 2023 consolidated financial results and ETR.
  • These forecasts assume the company’s current economic forecast and fuel price expectations and no additional adverse geopolitical developments.
  • managing the continued global volume softness we are experiencing across the business

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

-0.3%

Avg return

Earnings day

+0.1%

Avg return

5 days after

+2.3%

Avg return

30 days after

43%

31 / 72 earnings

Positive

+16.4%

Q4 2020

Best reaction

-14.6%

Q1 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2026
Q3 2026+1.4%+0.4%+10.2%
Q2 2026-1.6%+3.1%+7.3%
Q1 2026+2.4%+3.2%+5.0%
Q4 2025-0.8%-2.1%-1.5%
Q3 2025-6.4%-1.0%-15.7%
Q2 2025+0.9%-0.5%+0.7%
Q1 2025-14.6%-10.4%-8.0%
Q4 2024+15.5%+16.9%+16.4%
Q3 2024+9.4%+11.2%+2.7%
Q2 2024-12.7%-12.0%-13.4%
Q1 2024+0.5%+4.7%-2.4%
Q4 2023-3.3%-0.5%+12.9%
Q3 2023+12.8%+12.6%+18.1%
Q2 2023+0.7%+4.2%+9.2%
Q1 2023-2.6%-5.4%-0.0%
Q4 2022+6.2%+4.8%-0.8%
Q3 2022-3.1%+0.3%-8.9%
Q2 2022+4.0%+4.6%+6.4%
Q1 2022-8.7%-9.6%-7.2%
Q4 2021-1.8%+0.2%-0.1%
Q3 2021+5.2%+0.4%+8.2%
Q2 2021-4.6%-5.4%-12.6%
Q1 2021+5.9%+2.7%+19.4%
Q4 2020+16.4%+15.6%+28.4%
Q3 2020+10.2%+22.7%+31.6%
Q2 2020-10.5%-9.7%-2.8%
Q1 2020-13.1%-14.3%-13.2%
Q4 2019-0.6%+2.0%+9.3%
Q3 2019-4.0%-4.6%+8.6%
Q2 2019-10.8%-13.3%-4.9%
Q1 2019-5.4%-3.2%-12.5%
Q4 2018-4.6%-8.3%-10.3%
Q3 2018-0.2%-8.1%+0.8%
Q2 2018+3.8%+3.4%+12.5%
Q1 2018+2.5%+2.3%+4.1%
Q4 2017+0.6%+2.1%+0.4%
Q3 2017+1.9%-2.2%-3.0%
Q2 2017-2.8%-2.9%-5.8%
Q1 2017+7.8%+8.1%+5.2%
Q4 2016-4.8%-8.5%-3.7%
Q3 2016+12.8%
Q2 2016+4.9%
Q1 2016-2.9%
Q4 2015-2.1%
Q3 2015-1.1%
Q2 2015+0.1%
Q1 2015+2.8%
Q4 2014+5.2%
Q3 2014-1.5%
Q2 2014+0.4%
Q1 2014+5.6%
Q4 2013-3.8%
Q3 2013-9.4%
Q2 2013+1.0%
Q1 2013-2.7%
Q4 2012+3.2%
Q3 2012-3.6%
Q2 2012-1.3%
Q1 2012-0.8%
Q4 2011-0.9%
Q3 2011+2.2%
Q2 2011-0.7%
Q1 2011+3.3%
Q4 2008-5.2%
Q4 2010-5.2%
Q3 2010-3.2%
Q3 2009-3.2%
Q2 2010+0.3%
Q2 2009-1.1%
Q1 2009-1.1%
Q1 2010-1.1%
Q4 2009-1.1%

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