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FedEx Corporation (FDX-0.06%) has submitted its 10-Q filing for the quarterly period ended November 30, 2024.
The filing details a 1% decrease in revenue for the quarter to $21,967 million compared to $22,165 million in the same period the previous year. Operating income for the quarter was $1,052 million, down from $1,276 million in the prior year, attributed to lower demand for U.S. domestic package and freight services.
FedEx Freight segment revenue decreased by 11% to $2,177 million, while the Federal Express segment revenue remained flat at $18,841 million. The decline in FedEx Freight was primarily due to lower shipments and yields.
Operating expenses for the quarter were $20,915 million, consistent with the previous year. Notable increases were seen in purchased transportation and business optimization costs, while fuel expenses decreased by 29%.
Net income for the quarter was $741 million, down from $900 million in the previous year. Basic and diluted earnings per share were $3.06 and $3.03, respectively, compared to $3.59 and $3.55 in the prior year.
FedEx announced a plan to separate FedEx Freight into a new publicly traded company, expected to be completed within the next 18 months. The transaction is intended to be tax-free for U.S. federal income tax purposes.
The company repurchased $1.0 billion of its common stock during the quarter and expects to repurchase an additional $500 million in 2025. As of November 30, 2024, $3.1 billion remained available under the repurchase program.
FedEx's capital expenditures for 2025 are projected to be approximately $5.2 billion, focusing on network optimization and modernization of facilities.
The filing also discusses risks related to geopolitical conflicts, inflation, and interest rates, which continue to impact demand for FedEx's services. The company is implementing its DRIVE transformation program to improve efficiency and reduce costs.
FedEx's effective tax rate for the quarter was 24.5%, slightly lower than the previous year's 25.1%. The company is currently under examination by the IRS for tax years 2016 through 2021.
FedEx maintains a credit rating of BBB from Standard & Poor's and Baa2 from Moody's, with a stable outlook from both agencies.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the FedEx Corporation quarterly 10-Q report dated December 19, 2024. To report an error, please email earnings@qz.com.