FedEx Quarterly Profit Drops as Customers Opt for Cheaper, Slower Shipping Alternatives. Shares Drop 11% Premarket.

Benzinga

FedEx reported a sharp decline in quarterly profits and lowered its full-year revenue forecast as customers shifted from faster, expensive deliveries to cheaper alternatives. FedEx CEO Raj Subramaniam cited softer industrial demand as shipments between manufacturers, FedEx’s most profitable segment, declined. Cost cuts from restructuring and merging Ground and Express units failed to offset falling demand. Shares fell nearly 11% in after-hours trading, impacting UPS stock by 2.5%.

Transcript

00:00It's Benzinga, and here's what's on the block.

00:02FedEx reported a sharp decline in quarterly profits and lowered its full-year revenue

00:06forecast as customers shifted from faster, expensive deliveries to cheaper alternatives.

00:11FedEx CEO Raj Subramaniam cited softer industrial demand as shipments between manufacturers,

00:17FedEx's most profitable segment, declined.

00:20Cost cuts from restructuring and merging ground and express units failed to offset falling

00:24demand.

00:25Investors fell nearly 11 percent in after-hours trading, also impacting UPS stock by 2.5 percent.

00:30For all things money, visit Benzinga.com.

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