FedEx cutting costs, withdraws 2023 guidance after first-quarter shipments disappoint

FedEx withdrew its full-year guidance and announced significant cost-cutting measures on Thursday, after it said that global volume of shipments was softer than expected.

The CEO said in the release that global volumes declined as macroeconomic trends worsened. We are speeding up cost reduction efforts.

FedEx will close 90 office locations, close five corporate office facilities and reduce flights in order to cut costs.

FedEx stock fell in the late hours.

Fiscal first quarter earnings fell well short of expectations. The report was issued early because it was scheduled to be released next week.

FedEx's performance was based on Refinitiv consensus estimates.

• Earnings per share: $3.44, adjusted vs. $5.14 expected
• Revenue: $23.2 billion vs. $23.59 billion expected

FedEx withdrew its full-year forecast due to a volatile environment. Capital expenditure for the year was reduced by 500 million dollars.

Weakness in Asia and challenges to service in Europe were cited as reasons for the company's under performance. The company said operating expenses were high. FedEx had an adjusted operating income of over a billion dollars.

The company expects to report adjusted earnings per share of at least $2.75 for the second quarter. According to Refinitiv, analysts were looking for Q2 earnings of $5.48 per share and revenue of $24.86 billion.