FedEx Shows Strong Q1 Earnings Growth Amid Strategic Shifts

2025-09-19 companies

Memphis, Friday, 19 September 2025.
FedEx reports a Q1 revenue of $22.2 billion, marking a year-over-year increase. The company completed $500 million in share repurchases and plans to spin off FedEx Freight by June 2026.

FedEx Corp. (NYSE: FDX) has reported a strong start to its fiscal year 2026, with a first-quarter revenue of $22.2 billion, reflecting a year-over-year increase from $21.6 billion in fiscal 2025 [1][2]. The company has also completed $500 million in share repurchases during the quarter, repurchasing approximately 2.2 million shares. This strategic financial maneuver indicates FedEx’s commitment to enhancing shareholder value [1][2].

Strategic Plans and Market Positioning

FedEx is on track to spin off its FedEx Freight segment into a new publicly traded company by June 2026. This move is part of a broader strategy to streamline operations and focus on core business areas, which could potentially unlock shareholder value and improve operational efficiency [2][3]. The planned spin-off is seen as a catalyst for future growth, allowing FedEx to sharpen its focus on its higher-margin businesses [2][3][4].

Impact of Global Trade Changes

The recent removal of the ‘de minimis’ exemption for duty-free shipments under $800 globally has posed challenges for FedEx, impacting revenue streams, particularly from China and Hong Kong. This policy change, effective from August 2025, has resulted in a significant $150 million revenue loss in the first quarter alone [4][5]. FedEx’s strategic response to these trade policy shifts will be crucial in mitigating future revenue impacts [5][6].

Future Outlook and Investor Confidence

Looking ahead, FedEx projects its full-year earnings per share for fiscal 2026 to be between $17.20 and $19.00, with anticipated revenue growth of 4% to 6% [6][7]. This optimistic outlook is underpinned by continued cost-saving initiatives and strategic investments aimed at enhancing operational capabilities. Despite the challenging trade environment, FedEx’s strong first-quarter performance has bolstered investor confidence, reflected in the recent uptick in its stock price [6][7].

Sources

FedEx earnings financial outlook