Tuesday, February 27, 2024

FedEx cuts full-year revenue forecast, shares sink

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FedEx cuts full-year revenue forecast, shares sink © Reuters. FILE PHOTO: A Federal Express truck is shown in Los Angeles, California, U.S., October 16, 2019. REUTERS/Mike Blake/File Photo

(Reuters) -FedEx cut its full-year revenue forecast on Tuesday as it battled United Parcel Service (NYSE:) and other package delivery rivals in what is shaping up to be a weak holiday season, and its shares fell nearly 8%.

FedEx (NYSE:) now expects a low single-digit percentage decline in revenue from last year, compared with its prior forecast of roughly flat results.

The company’s shares fell to $258.30 in extended trading after closing at $280 on Tuesday.

FedEx, which has been slashing costs to protect profits, picked up business from UPS customers ahead of the Aug. 1 expiration of its rival’s contract covering about 340,000 United Brotherhood of Teamsters-represented workers.

UPS has fought to win back that business, including paying the early termination fees for customers who switched to FedEx during the talks, shipping consultants told Reuters.

FedEx also said it expects to repurchase an additional $1 billion of common stock during fiscal 2024.

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