Key Takeaways
- FedEx reports fiscal 2025 first-quarter earnings after the bell Thursday, with analysts expecting the shipping giant to post year-over-year revenue and profit gains.
- The company announced a restructuring program in April 2023, and has largely managed to increase profit despite revenue declines in recent quarters.
- FedEx and UPS saw shipping demand hit record highs during the pandemic, but have worked to handle a drop in volume since.
FedEx (FDX) is set to report fiscal 2025 first-quarter earnings after the bell Thursday, with analysts expecting the shipping giant to post year-over-year revenue and profit gains.
Analysts polled by Visible Alpha expect net income of $1.16 billion on revenue of $21.96 billion, up from $1.08 billion and $21.68 billion, respectively, in the first quarter of fiscal 2024.
Analysts are largely optimistic about FedEx’s stock, with 11 “buy” ratings and just “hold” and one “sell” rating apiece, according to Visible Alpha’s database, with an average price target of $323.50, nearly 13% above Friday’s closing level.
| Analyst Estimates for Q1 2025 | Q4 2024 | Q1 2024 | |
| Revenue | $21.96 billion | $22.11 billion | $21.68 billion |
| Diluted EPS | $4.73 | $5.94 | $4.23 |
| Net Income | $1.16 billion | $1.47 billion | $1.08 billion |
Key Metric: Full-Year Outlook
In its fourth-quarter report in June, FedEx introduced its projections for fiscal 2025. It guided low- to mid-single-digit revenue growth, while analysts expect growth of just over 2% from last year’s $87.69 billion. The company also saw earnings per share (EPS) between $18.25 and $20.25, 6% to 18% better than the $17.21 generated in fiscal 2024, while analysts expect $19.87.
FedEx will be losing out on one source of revenue later this month, when its contract with the U.S. Postal Service (USPS) officially ends and shipping rival UPS (UPS) takes over as the USPS’ official air freight carrier. In April, FedEx said it was unable to reach “mutually agreeable terms” with the USPS, and said it planned to “implement adjustments” to its shipping network to adjust for the lost volume and further improve profitability.
Business Spotlight: Cost-Cutting Measures Mostly Paying Off
In April 2023, FedEx announced plans to restructure and cut an estimated $4 billion in costs by 2025. The plan largely has paid off, with FedEx mostly posting substantial profit improvements despite revenue declines or slight gains in recent quarters.
FedEx looked to cut costs after shipping demand fell from its pandemic-fueled peak, with UPS also reporting revenue declines amid lower volumes. Last quarter, FedEx said it expected to cut about $2.2 billion in costs over fiscal 2025, up from $1.8 billion in fiscal 2024.
FedEx Chief Customer Officer Brie Carere said in its June earnings call that the company expects “the demand environment to moderately improve as we move through the year.”
FedEx stock closed Friday at $286.38, up 13%% on the year.