FedEx beats earnings targets and raises 2026 revenue forecast to 12%

FedEx shareholders face a mixed start to the new fiscal year as the company posted stronger-than-expected quarterly results but saw its stock dip slightly in after-hours trading. The company reported adjusted earnings of $3.74 per share for the period ended September 30, exceeding the $3.36 average analyst estimate tracked by LSEG. Total revenue reached $22.86 billion, outpacing the consensus projection of $22.42 billion.

The bottom line reflects a shift in the company's operational focus following the spinoff of FedEx Freight into a separate public entity. Reported net income for the quarter stood at $290 million, or $1.21 per share, down from $650 million, or $2.73 per share, in the same period a year earlier. The adjusted figure excludes one-time items such as losses on short-term investments, gains from debt extinguishment, and specific restructuring costs.

This release is the first for FedEx since the company moved its fiscal year-end from May 31 to December 31. Management indicated that the express U.S. segment generated higher operating income during the quarter. The company attributed this increase primarily to improved package yields and higher shipping volumes.

CEO Raj Subramaniam stated that the firm is winning in high-value market segments while optimizing its network. He noted that strong operating results and adjusted free cash flow drove the decision to raise the full-year outlook. The company now projects adjusted earnings per share between $18 and $18.60 for the year, up from a previous range of $16.90 to $18.10.

FedEx also increased its expectation for 2026 revenue growth to approximately 12% year over year. This figure represents a step up from the 11% increase the company had previously projected. The upward revision signals management confidence in the current operational trajectory despite the changes in the reporting calendar.

The company announced a leadership change earlier this week, naming Jamere Jackson as the new chief financial officer. Jackson, a former executive at AutoZone, will assume the role on November 30. He succeeds Claude Russ, who has served as interim CFO since June 1, following the April announcement that John Dietrich would step down from the position.