Updated version 1 - FedEx expects annual profits to exceed forecasts, benefiting from rising prices and higher volume, achieving quarterly profit growth

Added share price information in paragraph 2

Reuters, October 28 - FedEx (FDX.N) on Wednesday reported a 28% year-on-year increase in third-quarter earnings, mainly due to improved pricing, volume growth and cost-saving measures, and projected full-year profit to surpass market expectations.

However, as operating margin for its core U.S. express business fell to 6.6% from 6.8% a year earlier, its share price dropped nearly 4% in after-hours trading.

According to data compiled by London Stock Exchange Group (LSEG), the Memphis-based company forecast adjusted earnings per share for 2026 to be between $18 and $18.60, higher than analysts’ expectations of $17.73 per share.

From this quarter, FedEx shifted to reporting based on the calendar year rather than the fiscal year.

The company stated that its performance improvement was driven by higher parcel yield, volume growth, and continued cost savings. However, these factors were partially offset by higher expenses for transport services, employee wages and compensation, as well as changes in U.S. tariff policy.

“We remain committed to rigorous execution of our operating plans to reduce service costs while focusing on profitable growth,” said CEO Raj Subramaniam.

As a bellwether for global trade, FedEx reported adjusted earnings per share of $3.74 for the third quarter, up from $2.93 a year ago.

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