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FedEx Corp. shares an extended session on Tuesday after the logistics company missed profit expectations for its first fiscal quarter and lowered its outlook for fiscal year 2020 amid "rising trade tensions" and world economic situation.
FedEx
FDX, -0.16%
said it earned $ 745 million, or $ 2.84 per share, in the quarter, compared to $ 835 million, or $ 3.10 per share, in the same quarter of the prior year.
Adjusted for non-recurring items, the company posted earnings of $ 800 million, or $ 3.05 per share, compared with $ 933 million, or $ 3.46 per share, a year earlier. The turnover is stable at 17.05 billion dollars.
Analysts surveyed by FactSet were expecting an adjusted profit of 3.15 USD per share for a turnover of 17 billion USD.
"Our performance continues to be affected by a weakened global macroeconomic environment, driven by increasing trade tensions and political uncertainty," said Executive Director Frederick W. Smith in a statement.
The company has focused its weak operating results on "weakening global economic conditions, increasing costs of expanding service offerings and continuing the transition to less profitable services."
These were offset by lower compensation expense, FedEx Ground revenue growth and increased FedEx Freight returns, the company said.
In August, FedEx terminated its contract for the delivery of Amazon.com's products.
AMZN, + 0.81%
and in June, his domestic contract with the e-commerce giant was finalized with FedEx Express.
FedEx will take further cost-cutting measures, such as cuts to its FedEx Express airline network "to better match capacity with demand," the company said.
The company expects adjusted earnings for fiscal year 2020 of between $ 11 and $ 13 per share. This takes into account the "moderate" growth of the US economy, fuel price expectations and "no further weakening of the international economy," FedEx said.
Analysts surveyed by FactSet are expecting an adjusted profit of $ 14.68 per share for the 2020 fiscal year.
FedEx shares rose 7.5% this year, versus 20% for the S & P 500 Index
SPX, + 0.26%
.
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