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FedEx Corporation (FDX-6.64%) has submitted its 10-Q filing for the quarterly period ended February 28, 2025.
The filing reports an increase in operating income by 4% for the third quarter of 2025, while the nine-month period saw a decrease of 14%. Revenue increased by 2% in the third quarter and remained flat over the nine months compared to the previous year.
FedEx's DRIVE program contributed to cost savings, which helped offset increased expenses related to purchased transportation and wage rates. The company also faced higher business optimization costs and lower fuel surcharges.
FedEx Freight segment revenue decreased by 5% in the third quarter and 6% over the nine-month period, primarily due to lower shipments and yields. Operating income for this segment also decreased by 23% in both the third quarter and nine-month period.
The filing details FedEx's ongoing efforts to manage its capital expenditures, which are expected to be approximately $4.9 billion for the fiscal year 2025, with a focus on reducing capital intensity relative to revenue.
FedEx is proceeding with the planned spin-off of its FedEx Freight segment into a new publicly traded company, expected to be completed by June 2026. The transaction is intended to be tax-free for U.S. federal income tax purposes.
The company reported cash and cash equivalents of $5.1 billion as of February 28, 2025, and highlighted its available liquidity under existing credit agreements to meet operational and capital needs.
FedEx repurchased $2.5 billion of its common stock during the nine-month period ended February 28, 2025, with $2.6 billion remaining available for repurchases under the existing stock repurchase program.
The filing also addresses risks related to macroeconomic conditions, inflation, fuel prices, and geopolitical conflicts, which could impact FedEx's operations and financial performance.
FedEx's effective tax rate was 23.0% for the third quarter and 24.1% for the nine-month period, with the company continuing to manage its tax position amid ongoing IRS examinations and litigation.
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 March 20, 2025. To report an error, please email earnings@qz.com.