FedEx profit leaps, but shares off on 2022 forecast

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FILE PHOTO: A FedEx truck is driven through downtown in Los Angeles
FILE PHOTO: A FedEx truck is driven through downtown in Los Angeles, California, U.S., July 22, 2019. REUTERS/Mike Blake/File Photo

June 24, 2021

LOS ANGELES (Reuters) -U.S. delivery firm FedEx Corp on Thursday reported quarterly profit and revenue that jumped more than expected, but shares shed 4.2% after its earnings forecast fell short of Wall Street expectations.

Shares in the Memphis-based company dropped $12.81 to $290.88 in extended trading after it forecast fiscal 2022 earnings of $18.90 to $19.90 per share – below analysts’ average estimate of over $20 per share.

The stock had finished the session up roughly 150% from March 1, 2020 – some two weeks before U.S. states and jurisdictions began closing businesses to curb the spread of the coronavirus.

Fiscal fourth quarter adjusted net income at FedEx rose to $1.36 billion, or $5.01 per share, from $663 million, or $2.53 per share, a year earlier. Pandemic-fueled demand for e-commerce services supported higher fees and robust volumes contributed to cost savings.

Revenue increased 30% to $22.6 billion.

Analysts expected fourth-quarter earnings of $4.99 per share and revenue of $21.5 billion, according to Refinitiv data.

(Reporting by Lisa Baertlein in Los Angeles, Editing by Rosalba O’Brien and Alistair Bell)