FedEx said Tuesday that its quarterly earnings and sales fell from a year ago and warned of weak demand, but said its cost-cutting measures were making up for it.
The package delivery giant's net income fell in the third quarter. The sales fell short of estimates and were down from a year ago.
FedEx reported per share earnings of $3.18 which was ahead of analyst estimates but well off the $4.83 per share it reported a year ago.
FedEx performed better than Refinitiv consensus estimates.
The company's Express unit had operating income that was down 64% from a year ago. FedEx Ground and FedEx freight operating income increased from a year ago. Higher yields aided the three units.
In September, FedEx announced a number of cost-cutting measures. Rates for package delivery were raised. The company withdrew guidance and the CEO warned of a worldwide recession.
FedEx said Tuesday it will be able to cut another $1 billion beyond what it forecast in September to bring the total savings to $3.7 billion.
FedEx's CFO said in an earnings release that the teams have an "unmitigated focus on rapidly implementing cost savings to improve profitability" As we look to the second half of our fiscal year, we are speeding up our progress on cost actions.
FedEx expected full-year earnings to be between $13 and 14 per share, just shy of analysts' expectations.
The company's shares are down about 36% for the year, compared to the S&P 500's 20% decline.
FedEx executives will hold a call with analysts after the market closes. There is an hour and a half later. They are likely to face questions about the global economy, holiday travel demand and reliability.
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