A couple weeks after setting expectations lower for the fiscal first quarter, global shipper FedEx (NYSE:FDX) grazed its estimate with earnings, then proceeded to hack away at forecasts for the foreseeable future, again citing a weakening global economy.
FedEx earned $459 million ($1.45 per share) in its fiscal Q1, meeting the top end of its previously lowered estimate and beating the $1.40 expected by Wall Street (that expectation also was revised lower, from $1.56). FDX’s earnings came in about 1% lower than the year-ago period; however, revenues were up 3% to $10.79 billion.
Hurting the company is weakened demand for its higher-priced delivery services, especially its Express unit. FedEx is countering with a round of expense trimming, including voluntary buyouts and the retirement of planes.
FedEx also estimated second-quarter earnings in a range of $1.30 to $1.45 per share, which fell far below expectations of $1.67 and would be a significant drop from the year-ago period.
The company also lowered full-year profit forecasts from a range of $6.90 to $7.40 per share to a range of $6.20 to $6.60 per share, which would greatly miss expectations for $7.03.
FDX shares were set to open Tuesday trading about 2% lower.
– Kyle Woodley, InvestorPlace Assistant Editor