FedEx (FDX) reported earnings on Tue 17 Sept 19 (a/h)

** charts before earnings **

 

** charts after earnings **

FedEx misses by $0.11, reports revs in-line; guides FY20 EPS below consensus; co cites increased trade tensions and additional weakening of global economic conditions

Reports Q1 (Aug) earnings of $3.05 per share, excluding non-recurring items, $0.11 worse than the S&P Capital IQ Consensus of $3.16; revenues were unchanged year/year at $17.05 bln vs the $17.05 bln S&P Capital IQ Consensus.

• "Our performance continues to be negatively impacted by a weakening global macro environment driven by increasing trade tensions and policy uncertainty...Despite these challenges, we are positioning FedEx to leverage future growth opportunities as we continue the integration of TNT Express, enhance FedEx Ground residential delivery capabilities and modernize the FedEx Express air fleet and hub operations."

Co issues downside guidance for FY20, sees EPS of $11.00-13.00, excluding non-recurring items, vs. $14.62 S&P Capital IQ Consensus.

• FedEx is lowering its FY20 earnings forecast as the co's revenue outlook has been reduced due to increased trade tensions and additional weakening of global economic conditions since the co's initial FY20 forecast in June. The revised outlook also reflects increased FedEx Ground costs and August's loss of FedEx Ground business from a large customer. In addition, the FedEx ETR is now expected to be 24% to 26% before the year-end MTM retirement plan accounting adjustment, due to lower-than-expected earnings in certain non-U.S. jurisdictions.
• "FedEx is implementing additional cost-reduction initiatives to mitigate the effects of macroeconomic uncertainty, including post-peak reductions to the global FedEx Express air network to better match capacity with demand."