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On March 20, 2025, FedEx Corporation FDX posted mixed third-quarter fiscal 2025 (ended Feb. 28, 2025) results. While earnings per share missed estimates, revenues beat the same. The transportation heavyweight also lowered its fiscal 2025 earnings per share outlook, highlighting the weak economic conditions.
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This was the second time that the company missed estimates in the last four quarters.
FedEx Price and EPS Surprise
FedEx Corporation price-eps-surprise | FedEx Corporation Quote
Brief Recap of FDX’s Q3 Performance & FY25 View
Quarterly earnings (excluding 75 cents from non-recurring items) of $4.51 per share missed the Zacks Consensus Estimate of $4.65. However, the bottom line improved 16.8% year over year, mainly owing to the cost-reduction benefits from DRIVE program initiatives. Revenues of $22.2 billion came ahead of the Zacks Consensus Estimate of $21.8 billion and improved 2.1% from the year-ago fiscal quarter’s reported figure.
Quarterly earnings were hurt by the challenging conditions prevalent during the three-month period. A shortened holiday season, adverse weather conditions, an early Chinese New Year, and a rise in recession fears following tariff-related tensions dented results.
FedEx now expects revenues to be flat to slightly down year over year versus the prior forecast of approximately flat. The adjusted earnings outlook was lowered to the $18-18.6 per share band from the previously expected range of $19-20 per share. The guidance for capital spending was revised down to $4.9 billion from $5.2 billion.
As a result of the earnings miss and the downbeat guidance for fiscal 2025, earnings per share estimates have moved southward over the past seven days for fourth-quarter fiscal 2025, first-quarter fiscal 2026, fiscal 2025 and fiscal 2026.
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FDX Stock’s Disappointing Price Performance
Due to the weakness in package volumes, shares of FDX have declined in double digits over the past year. The Zacks Transportation—Air Freight and Cargo industry and rival United Parcel Service UPS have performed worse. Fellow industry player Air Transport Services Group ATSG has, however, performed better than FDX and UPS in the past year.
1-Year Price Comparison
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FDX’s Fundamental Strength
For long-term investors, a single quarter’s results are not so important. They would rather base their investment decision on the underlying fundamentals. FDX scores impressively in this regard, driven by its robust operating model.