FedEx Earnings Surge Amid Potential Freight Unit Spin-Off

FedEx reported fiscal fourth-quarter earnings per share of $5.41 from sales of $22.1 billion. That was ahead of Wall Street’s estimates for EPS of $5.34 and sales of $22 billion.

While those results were solid, FedEx dropped a bombshell in its press release, stating that it is “conducting an assessment of the role of FedEx Freight in the company’s portfolio structure and potential steps to further unlock sustainable shareholder value.”

FedEx Freight is the less-than-truckload (LTL) subsidiary of FedEx. It was created in in 2001, when FedEx Cor. acquired and merged the assets of American Freightways, Viking Freight and Watkins Motor Lines.

It has since become the largest carrier in the LTL space. In 2022, it posted $10.18 billion in revenue, an 18.5% percent boost in revenue from the previous year, according to figures compiled by SJ Consulting.

But last year, FedEx Freight slipped. Its revenue dropped 10.6% to $9.01 billion, according to SJ Consulting. It still ranked as the largest LTL carrier in the country.

Investors were excited by FedEx's mix of earnings, guidance and a strategic review. FedEx stock surged 14.7% in Wednesday trading at $293.94 a share. It was the best performer in the S&P 500 early in the trading day, according to Dow Jones Market Data

Visit Logistics Management to view the full story

Related Resources

 

The 2024 General Rate Increase Guide for UPS and FedEx

Reveel's shipping intelligence platform solution helps businesses navigate rate increases, fees, surcharges, changes to zone and dimension rates and other expenses helping level the playing field with UPS and FedEx.

Download