FedEx Corporation (FedEx) reported disappointing 3Q19 results on Tuesday (20 March 2019) in which it revealed that its revenue stood at $17.0bn (+3% YoY) vs $16.5bn posted in 3Q18, while its diluted EPS (-18.6% YoY) stood at $3.03 compared with $3.72 recorded in the corresponding period of the prior year. Both were below the Refinitiv consensus forecasts, which had expected EPS of $3.11 and revenue of $17.01bn.
The ground-shipping business saw revenue rise 9% YoY, but operating income fell by 6% YoY “due to higher costs for running six days a week year-round and buying transportation capacity.” The company also saw continued weakness in its international Express business, which includes the former Dutch delivery company TNT Express.
Chairman and CEO Fred Smith called the results “disappointing”, noting that “Investments in innovation, infrastructure and automation will help boost earnings in the long run …”.
Looking ahead, for FY19, the company also issued weak FY19 EPS guidance of between $15.10 and $15.90 vs a Refinitiv consensus forecast of $15.97 (this was the second time in three months that FedEx has cut its full-year earnings outlook). For 4Q19, it expects EPS of between $4.58 and $5.38, compared to the Refinitiv estimate of $5.39.