FedEx raises 2026 earnings outlook as shares slip after hours

FedEx Corp. (NYSE: FDX) said in a press release furnished with a regulatory filing on Oct. 28 that it raised its calendar 2026 earnings outlook after the quarter ended Sept. 30.

Shares fell 2.3% in after-hours trading as of 5:29 p.m. ET, from a regular-session close of $304.97.

Here's how the company did:

• Adjusted EPS: $3.74 per share vs. $2.93 a year earlier
• GAAP diluted EPS: $1.21 per share vs. $2.73 a year earlier
• Revenue: $22.9 billion vs. $20.4 billion a year earlier
• Adjusted operating income: $1.20 billion vs. $1.03 billion a year earlier
• GAAP operating income: $1.07 billion vs. $0.97 billion a year earlier

The company said higher package base yields, higher package volumes and continued structural cost reductions from business optimization initiatives drove the improvement.

Partly offsetting those gains were higher purchased transportation rates, higher wage rates and variable compensation expenses, and the financial impact of global trade policy changes.

2026 guidance

FedEx now expects calendar 2026 adjusted diluted earnings per share of $18.00 to $18.60. Its GAAP diluted EPS forecast from continuing operations is $35.30 to $35.90 per share.

The company kept its pension contributions forecast at $475 million and its capital spending forecast at $3.9 billion, both unchanged from the prior forecast.

FedEx Corp. president and chief executive officer Raj Subramaniam said, "As our strong operating results and adjusted free cash flow demonstrate, FedEx is winning across high-value market segments while we optimize our network, driving an increase to our full-year outlook."

Segment results

Express U.S. Domestic operating income was $946 million, up 7% from $884 million a year earlier. Average daily package volume rose 2% to 14.4 million, and the composite package yield was $15.32, up 7%.

Express International operating income was $220 million, up 15% from $192 million. Total international average daily package volume fell 4% to 2.8 million.

Freight spin-off and divestiture

FedEx completed the spin-off of FedEx Freight on June 1 and retained a 19.9% ownership interest. It recorded a $1.2 billion loss on that stake in the quarter, and the carrying value of the stake was $3.3 billion at Sept. 30.

The company used cash from an approximately $4.1 billion dividend from FedEx Freight, along with cash on hand, to tender for about $4.9 billion of debt, producing a non-GAAP pre-tax gain of $627 million.

FedEx completed the sale of FedEx Supply Chain to CMA CGM Group on Oct. 1 for about $1.4 billion, it said in the filing.

Cash and buybacks

FedEx completed $2.0 billion in stock repurchases from June through September, retiring about 6.3 million shares. It said the lower share count added 2 cents per diluted share to third-quarter results. About $4.3 billion remained under its 2026 repurchase authorization at Sept. 30.

Cash on hand was $8 billion at Sept. 30, including about $2.7 billion in IEEPA tariff refunds held for customers.

Claude Russ, FedEx Corp. enterprise vice president and interim chief financial officer, said the repurchase "displays our conviction in achieving our 2029 financial targets."

FedEx said parcel shipping rates will rise an average of 5.9% effective Jan. 4, 2027, as previously announced.