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FedEx Corp. (FDX) soared in after-hours trading after exceeding analyst expectations for its fiscal 2025 profit forecast. The company is attributing this positi

FedEx Expects Fiscal 2025 Profit to Top Estimates on Cost Cuts

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FedEx Corp. (FDX) soared in after-hours trading after exceeding analyst expectations for its fiscal 2025 profit forecast. The company is attributing this positive outlook to its ongoing cost-cutting initiatives, aiming to bolster margins even amidst subdued demand for parcel shipping.

Profit Above Analyst Estimates:

  • FedEx predicts fiscal 2025 earnings per share (EPS) to range between $20.00 and $22.00.
  • The midpoint of this range, at $21.00, sits slightly above the analyst consensus of $20.92 per share.
  • This positive outlook is driven by the company's expense reduction program, "DRIVE," which is anticipated to generate $2.2 billion in permanent cost savings throughout the fiscal year.

Revenue Growth and Demand:

  • FedEx projects low-to-mid single-digit percentage revenue growth year-over-year for fiscal 2025.
  • This indicates a continuation of the sluggish demand environment for parcel shipping.
  • Despite the lackluster demand, FedEx is confident that its cost-cutting measures will significantly improve profitability.

Looking Ahead:

The success of FedEx's strategy hinges on its ability to effectively implement cost reductions while maintaining service quality. Investors will be closely monitoring the company's progress throughout the fiscal year.

Stay Informed on M&A Activity in the Delivery Sector:

Mergers and acquisitions (M&A) can significantly impact the delivery industry. Stay updated on the latest trends and potential investment opportunities using Financial Modeling Prep's (FMP) M&A data and analysis: link to FMP's M&A developer documentation.

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