Latest News

FedEx shares rise as Wall Street celebrates profit beating amid trade uncertainty

FedEx shares rose 5% on Friday in premarket trade as investors cheered its quarterly profit and revenue beating against the backdrop of uncertainty related to tariffs and the ending of the "de minimis exemption" on low-value shipping.

FedEx's aggressive measures to cut costs, such as parking planes, shutting down facilities, and merging certain units, have helped protect profits. It has a plan to save $1 billion in this fiscal year, which ends May 2026.

The performance of the company was also boosted by a 5% increase in average daily domestic volumes. Its operating margin, an important metric, rose to 6%, up from 5.2%. This showed that U.S. consumers were resilient.

Analysts at J.P. Morgan said that FedEx's strong first quarter, and the issuance of an FY26 guide, was a pleasant surprise for a firm that had been impacted by a variety of challenges.

United Parcel Service shares rose more than 1%.

FedEx has reported an increase in adjusted profit per shares to $3.83, up from $3.60, a year ago. This surprised Wall Street analysts who had expected a decline in earnings because of the ending of the "de minimis exemptions" which allowed shipments under $800 in value to enter the U.S. without paying duty.

The company reported that global tariffs including the ending of the de minimis exclusion for China and Hong Kong cut its first-quarter revenues by $150 million. This hit is expected to repeat itself each quarter in this year. Brie Carere, chief customer officer, said that trade policies, combined with other pressures for FY26, represent a $1billion headwind.

While export volumes to international markets fell by 3%, the average daily volume increased by 4%. Revenue per package also increased by 2%.

FedEx's stock trades at 11,83 times its projected 12-month earnings, while UPS's is 12.04. Both companies' shares are lagging the market this year due to a softening of industrial demand, and customers preferring cheaper ground shipping.

(source: Reuters)