FedEx beats estimates, raises outlook after fiscal calendar reset

FedEx beat Wall Street expectations and raised its full-year outlook on Wednesday, October 28, in its first earnings report since realigning its fiscal calendar. The delivery company reported stronger adjusted earnings and revenue for the quarter ended September 30, although its shares slipped slightly in extended trading, CNBC reported.

Adjusted earnings were $3.74 a share, compared with the $3.36 expected by analysts surveyed by LSEG, according to CNBC. Revenue reached $22.86 billion, exceeding the $22.42 billion consensus estimate. Both measures also increased from the comparable period a year earlier.

The report follows a change in FedEx’s fiscal year-end from May 31 to December 31. It also comes after the June 1 separation of FedEx Freight into an independent publicly traded company, making the reporting period part of a broader transition in the group’s structure and financial presentation.

Reported net income fell to $290 million, or $1.21 a share, from $645 million, or $2.73 a share, a year earlier, according to the company’s financial statements. Adjusted net income, which excludes specified items, rose to $896 million from $693 million. The contrasting figures distinguish underlying operating gains from the effects of investment and transaction-related accounting.

RTTNews reported that quarterly results included a roughly $1.2 billion loss tied to FedEx’s retained investment in FedEx Freight, partly offset by a gain on debt extinguishment. Adjusted operating margin increased to 5.3% from 5.1%, providing another measure of the improvement beneath the decline in reported profit.

FedEx attributed higher operating income in its U.S. express business primarily to stronger package yields and volumes, CNBC reported. Chief Executive Raj Subramaniam also pointed to business in higher-value market segments and network optimization as support for the increased outlook. Those factors connect the earnings improvement to pricing, shipment activity and operating execution.

For calendar 2026, FedEx now expects adjusted earnings of $18 to $18.60 a share, up from its previous range of $16.90 to $18.10. It also raised its revenue growth forecast to approximately 12% from about 11%. The revisions signal stronger expectations for both sales and adjusted profitability.

The company kept its capital spending forecast at $3.9 billion, with investment directed toward network efficiency, fleet and facility modernization, and automation. It also completed $2 billion in share repurchases from June through September, leaving $4.3 billion available under its current authorization.

The next test is whether operating momentum supports the higher targets through year-end. FedEx said its forecasts depend on its economic and fuel-price assumptions and the absence of additional adverse economic, geopolitical or international trade developments. It also cautioned that further market-value accounting adjustments could materially affect reported results.