FedEx Stock Rallies 2% After Amazon Partnership Resumes

May 13, 2025 7:08 AM - Parth Sanghvi

Image credit: Dan Dennis

FedEx (NYSE:FDX) shares jumped 2% in after-hours trading Monday following reports that Amazon (NASDAQ:AMZN) is once again tapping FedEx's network to supplement its delivery capacity—marking a major turnaround since their split in 2019.

Key Details of the FedEx-Amazon Deal

Strategic Capacity Fill: An internal Amazon memo reveals FedEx will serve as one of several third-party carriers to address gaps left by UPS's scaled-back services.
Cost Favorability: Amazon cited “cost favorability” in the partnership—suggesting FedEx can undercut UPS rates on select routes.
Multi-Carrier Model: FedEx joins UPS, the U.S. Postal Service, and Amazon's own last-mile network in a diversified delivery strategy.

Neither side disclosed which shipment types FedEx will handle, but the alliance aims to bolster Amazon's peak-season resilience and reduce logistics bottlenecks.

Market Reaction & Movers

Investors rewarded FedEx's stock with a notable after-hours gain. For a real-time view of the top market movers—including FDX—tap the Market Biggest Gainers API, which tracks the stocks leading both premarket and after-hours sessions.

Why This Matters

Logistics Dynamics: The renewed collaboration shifts the competitive balance among parcel carriers, potentially pressuring UPS's volumes and margins.
Amazon's Flexibility: By engaging multiple partners, Amazon can optimize costs and service levels without overloading any single carrier.
Investor Implications: FedEx's improved utilization and incremental revenue could boost its near-term guidance, while UPS may face headwinds if volumes don't fully rebound.

What to Watch Next

Volume Mix Impact: FedEx's upcoming earnings call will shed light on how much of Amazon's volume is being rerouted and at what margin.
UPS Response: Watch for UPS's strategic counters—be it pricing changes or capacity initiatives—to defend its share.
Peak-Season Plans: As Q4 approaches, any further tweaks in Amazon's carrier mix could signal broader industry realignment.

By monitoring FedEx's share movements via the Market Biggest Gainers API and tracking logistics commentary in upcoming earnings releases, investors can gauge how this revived partnership reshapes the shipping landscape.

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