U.S. Stock Market News | FedEx plunges over 14% on Q1 earnings disappointment
FedEx's stock price fell by more than 14%, closing at $256.18. The company's adjusted earnings per share for the first quarter were $3.60, lower than analysts' expectations of $4.77 and the $4.37 in the same period last year. Revenue was $21.6 billion, slightly below the expected $21.9 billion. Due to customers shifting to cheaper delivery services and weak corporate demand, the domestic shipping volume of the express delivery division in the United States decreased by 3%
According to CNBC, on Friday, FedEx (FDX.US) saw its stock price drop, with the stock falling over 14% to $256.18 as of the time of writing. For the first quarter ending on August 31, the company reported an adjusted earnings per share of $3.60, significantly lower than analysts' expectations of $4.77 and the $4.37 reported in the same period last year. Revenue came in at $21.6 billion, slightly below analysts' expectations of $21.9 billion. This financial report is the first one released by FedEx after integrating its express, ground, and freight operations on June 1 into new reporting segments.
FedEx discovered in the most recent quarter that more price-sensitive customers are opting for slower and cheaper delivery services, a trend that also impacted rival UPS earlier this year. Brie Carere, FedEx's Chief Marketing and Communications Officer, stated during the company's earnings call that due to soft business-to-business demand, the domestic shipping volume in the company's express segment in the U.S. dropped by 3%