Why FedEx Cut Its Profit Forecast Again
Mar.19 — FedEx Corp. cut its profit forecast for the second time in three months, citing weakness in foreign markets and a slowdown in trade. Brooke Sutherland, a Bloomberg Opinion columnist, has more on \”Bloomberg Markets: What’d You Miss?\” Sutherland’s opinions are her own.
FedEx cut its annual profit forecast
FedEx shares plummet after a logistics company cut its annual profit forecast by 9%, citing trade tensions and recession fears.
The company’s revenue was $ 17.05 billion, which is 10 million less than the projected amount.
EPS came out at $ 3.05, vs. $ 3.15 analysts expected.
"Our performance continues to be negatively impacted by a weakening global macroeconomic environment driven by rising trade tensions and political uncertainty", – said CEO Frederick Smith.
The company said its financial performance in the first quarter declined mainly due to worsening macroeconomic conditions, rising costs to expand its services offerings and a shift to lower-margin services..
FedEx CFO Alan Graf said the company is pursuing additional cost-cutting measures to cushion the impact of economic uncertainty. For example, the company will cut back on FedEx Express to achieve greater efficiency..
In annual terms, following the results of the last trading session, FedEx shares rose by 7%.