FedEx Reports Higher Third Quarter Diluted EPS of $3.51

Third quarter income and margin improved despite lower revenue, primarily due to execution of the company’s DRIVE program and the continued focus on revenue quality.

“FedEx delivered another quarter of improved profitability in what remains a difficult demand environment, reflecting outstanding service and continued benefits from DRIVE,” said Raj Subramaniam, FedEx Corp. president and chief executive officer. “We are making meaningful progress on our transformation, while strengthening our value proposition and improving the customer experience. I’ve never been more confident in our path ahead as we build a more flexible, efficient, and intelligent network.”

FedEx Express operating results improved due to lower structural costs resulting from DRIVE initiatives and the benefit from one additional operating day, partially offset by lower revenue.

FedEx Ground operating results increased due to lower structural costs resulting from DRIVE initiatives, higher base yield, and reduced self-insurance costs. Cost per package was flat, as lower line-haul expense and improved dock productivity offset higher first- and last-mile costs.

FedEx Freight operating results decreased due to lower fuel surcharges, reduced weight per shipment and lower shipments, partially offset by higher base yield and the benefit from one additional operating day. Last year’s third quarter operating income included a $30 million gain on the sale of a facility.

The company completed a $1 billion accelerated share repurchase (ASR) transaction during the quarter. Approximately 4.1 million shares were delivered under the ASR agreement. The year-to-date decrease in outstanding shares benefited third quarter results by $0.09 per diluted share.

FedEx expects to repurchase an additional $500 million of common stock during the fiscal fourth quarter, which will bring the fiscal 2024 buyback total to $2.5 billion.
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