FedEx(FDX) - 2025 Q1 - Quarterly Results

Consolidated Financial Performance Annual Consolidated Statements of Income (FY2023-FY2024) FedEx Corporation's FY2024 consolidated revenue decreased to $87,693 million from $90,155 million in FY2023, with net income and EPS declining, while paying $5.04 per share in dividends | Metric | FY2023 (million USD) | FY2024 (million USD) | | :-------------------------------- | :---------------- | :---------------- | | Revenue | 90,155 | 87,693 | | Federal Express segment | 75,884 | 74,663 | | FedEx Freight segment | 10,084 | 9,429 | | Other and eliminations | 4,187 | 3,601 | | Total Operating Expenses | 85,243 | 82,134 | | Total Operating Income | 4,912 | 5,559 | | Federal Express segment | 4,193 | 4,819 | | FedEx Freight segment | 1,936 | 1,821 | | Corporate, other, and eliminations | (1,217) | (1,081) | | Income Before Income Taxes | 5,363 | 5,836 | | Net Income | 3,972 | 4,331 | | Basic Earnings Per Share | 15.60 | 17.41 | | Diluted Earnings Per Share | 15.48 | 17.21 | | Dividends Per Common Share | 4.60 | 5.04 | | Metric | FY2023 | FY2024 | | :--------------- | :----- | :----- | | Operating Margin | 5.4 % | 6.3 % | | Pre-Tax Margin | 5.9 % | 6.7 % | | Return on Assets | 4.6 % | 5.0 % | | Return on Equity | 15.5 % | 16.1 % | - FY2024 financial data includes several special adjustments: $582 million in business optimization strategy costs ($444 million after-tax, $1.77 diluted EPS)[6] - $157 million in asset impairment charges ($120 million after-tax, $0.48 diluted EPS), primarily related to the permanent retirement of aircraft and related engines in the Federal Express segment[6] - $57 million in legal matter insurance proceeds ($44 million after-tax, $0.17 diluted EPS)[6] - $561 million in non-cash net benefits ($426 million after-tax, $1.69 diluted EPS) from year-end mark-to-market retirement plan accounting adjustments[6] - $54 million ($0.21 diluted EPS) related to the remeasurement of state deferred income taxes under the "one FedEx" structure[6] Quarterly Consolidated Statements of Income (FY2023-FY2024) The company's FY2024 quarterly performance shows fluctuating total revenue, with $22,109 million in Q4, and operating margin reaching 7.0% in FY2024 Q4, higher than 6.9% in FY2023 Q4 | Metric | FY2023 Q1 | FY2023 Q2 | FY2023 Q3 | FY2023 Q4 | FY2024 Q1 | FY2024 Q2 | FY2024 Q3 | FY2024 Q4 | | :-------------------------------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Total Revenue (million USD) | 23,242 | 22,814 | 22,169 | 21,930 | 21,681 | 22,165 | 21,738 | 22,109 | | Total Operating Expenses (million USD) | 22,051 | 21,638 | 20,427 | 20,196 | 20,889 | 20,495 | 20,554 | 20,554 | | Total Operating Income (million USD) | 1,191 | 1,176 | 1,042 | 1,503 | 1,485 | 1,276 | 1,243 | 1,555 | | Net Income (million USD) | 875 | 788 | 771 | 1,538 | 1,078 | 900 | 879 | 1,474 | | Diluted Earnings Per Share | 3.33 | 3.07 | 3.05 | 6.05 | 4.23 | 3.55 | 3.51 | 5.94 | | Operating Margin | 5.1 % | 5.2 % | 4.7 % | 6.9 % | 6.8 % | 5.8 % | 5.7 % | 7.0 % | - FY2024 Q4 includes several special adjustments similar to annual report adjustments, such as business optimization costs ($218 million), asset impairment charges ($157 million), legal matter insurance proceeds ($57 million), non-cash net benefits from retirement plan accounting adjustments ($561 million), and state deferred income tax remeasurement ($54 million)[8] Capital Expenditures (FY2023-FY2024) FedEx Corporation's total capital expenditures in FY2024 were $5,176 million, a decrease from $6,174 million in FY2023, primarily invested in aircraft, parcel handling, ground support equipment, and facilities | Capital Expenditure Category | FY2023 (million USD) | FY2024 (million USD) | | :----------------------- | :---------------- | :---------------- | | By Asset Type | | | | Aircraft and Related Equipment | 1,684 | 1,627 | | Package Handling and Ground Support Equipment | 1,851 | 974 | | Vehicles and Trailers | 719 | 709 | | Information Technology | 802 | 656 | | Facilities and Other | 1,118 | 1,210 | | Total | 6,174 | 5,176 | | By Segment | | | | Federal Express segment | 5,480 | 4,591 | | FedEx Freight segment | 557 | 461 | | Other | 137 | 124 | | Total | 6,174 | 5,176 | Federal Express Segment Performance Annual Consolidated Statements of Income (FY2023-FY2024) Federal Express segment revenue in FY2024 was $74,663 million, slightly below $75,884 million in FY2023, yet operating income and margin improved, indicating cost control and efficiency gains | Metric | FY2023 (million USD) | FY2024 (million USD) | | :-------------------------------- | :---------------- | :---------------- | | Total Revenue | 75,884 | 74,663 | | U.S. domestic package revenue | 48,374 | 48,450 | | International export package revenue | 14,245 | 14,107 | | International domestic | 4,552 | 4,659 | | Freight revenue | 7,661 | 6,470 | | Other | 1,052 | 977 | | Total Operating Expenses | 71,691 | 69,844 | | Operating Income | 4,193 | 4,819 | | Operating Margin | 5.5 % | 6.5 % | - FY2024 operating expenses include $157 million in asset impairment charges related to the permanent retirement of certain aircraft and engines, and $251 million in business optimization costs[10] Quarterly Consolidated Statements of Income (FY2023-FY2024) Federal Express segment's FY2024 Q4 revenue was $18,792 million, with operating income of $1,305 million and an operating margin of 6.9%, while international economic package revenue grew significantly across all FY2024 quarters | Metric | FY2023 Q1 | FY2023 Q2 | FY2023 Q3 | FY2023 Q4 | FY2024 Q1 | FY2024 Q2 | FY2024 Q3 | FY2024 Q4 | | :-------------------------------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Total Revenue (million USD) | 19,184 | 19,157 | 18,919 | 18,624 | 18,426 | 18,773 | 18,672 | 18,792 | | U.S. domestic package revenue | 11,998 | 12,067 | 12,355 | 11,954 | 11,993 | 12,121 | 12,274 | 12,062 | | International export package revenue | 3,705 | 3,634 | 3,357 | 3,549 | 3,444 | 3,573 | 3,424 | 3,666 | | International domestic | 1,160 | 1,166 | 1,128 | 1,152 | 1,140 | 1,213 | 1,139 | 1,167 | | Freight revenue | 2,106 | 2,028 | 1,817 | 1,710 | 1,602 | 1,615 | 1,599 | 1,654 | | Other | 269 | 262 | 262 | 259 | 247 | 251 | 236 | 243 | | Total Operating Expenses (million USD) | 18,322 | 18,220 | 17,957 | 17,192 | 17,120 | 17,738 | 17,499 | 17,487 | | Operating Income (million USD) | 862 | 937 | 962 | 1,432 | 1,306 | 1,035 | 1,173 | 1,305 | | Operating Margin | 4.5 % | 4.9 % | 5.1 % | 7.7 % | 7.1 % | 5.5 % | 6.3 % | 6.9 % | - FY2024 Q4 includes $157 million in asset impairment charges and $102 million in business optimization costs, with business optimization costs occurring in all quarters[11] Annual Operating Statistics (FY2023-FY2024) Federal Express segment's total average daily package volume (ADV) slightly decreased in FY2024, but international economic package volume saw significant growth, with improved yield for U.S. domestic and international economic packages | Metric | FY2023 | FY2024 | Y-o-Y Growth Rate (FY24) | | :-------------------------------- | :----- | :----- | :---------------- | | Package Statistics | | | | | Total U.S. Domestic ADV (thousands) | 13,738 | 13,618 | (0.9 %) | | International Priority ADV (thousands) | 708 | 667 | (5.8 %) | | International Economy ADV (thousands) | 311 | 394 | 26.7 % | | Total International Export ADV (thousands) | 1,019 | 1,061 | 4.1 % | | International Domestic ADV (thousands) | 1,967 | 1,936 | (1.6 %) | | Total ADV (thousands) | 16,724 | 16,615 | (0.7 %) | | Yield Per Package | | | | | U.S. Priority ($) | 24.78 | 24.98 | | | U.S. Deferred ($) | 18.91 | 18.97 | | | U.S. Ground ($) | 11.59 | 11.76 | | | International Priority ($) | 60.61 | 55.36 | | | International Economy ($) | 41.73 | 46.14 | | | Composite Package Yield ($) | 15.75 | 15.80 | | | Freight Statistics | | | | | Total Average Daily Freight Pounds (thousands) | 24,245 | 21,444 | | | Composite Freight Yield ($/pound) | 1.24 | 1.18 | | | Total Package Revenue Growth Rate | | 0.1 % | | Quarterly Operating Statistics (FY2023-FY2024) Federal Express segment's total average daily package volume (ADV) in FY2024 Q4 was 16,034 thousand, flat year-over-year, with strong year-over-year growth in international economic package volume across all FY2024 quarters | Metric | FY2023 Q1 | FY2023 Q2 | FY2023 Q3 | FY2023 Q4 | FY2024 Q1 | FY2024 Q2 | FY2024 Q3 | FY2024 Q4 | | :-------------------------------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Total U.S. Domestic ADV (thousands) | 13,512 | 14,031 | 14,383 | 13,063 | 13,348 | 14,068 | 14,017 | 13,064 | | Total International Export ADV (thousands) | 993 | 1,056 | 1,013 | 1,013 | 1,023 | 1,079 | 1,056 | 1,086 | | Total ADV (thousands) | 16,365 | 17,206 | 17,370 | 15,998 | 16,267 | 17,232 | 16,956 | 16,034 | | International Economy ADV Y-o-Y Growth Rate | 24.6 % | 26.9 % | 25.9 % | 29.6 % | | | | | | Total Package Volume Y-o-Y Growth Rate | (0.6 %) | 0.2 % | (2.4 %) | 0.2 % | | | | | | Total Package Revenue Y-o-Y Growth Rate | (1.4 %) | 0.2 % | (0.0 %) | 1.4 % | | | | | FedEx Freight Segment Performance Annual Consolidated Statements of Income (FY2023-FY2024) FedEx Freight segment's FY2024 revenue decreased to $9,429 million from $10,084 million in FY2023, with a slight decline in operating income and operating margin | Metric | FY2023 (million USD) | FY2024 (million USD) | | :---------------- | :---------------- | :---------------- | | Revenue | 10,084 | 9,429 | | Total Operating Expenses | 8,148 | 7,608 | | Operating Income | 1,936 | 1,821 | | Operating Margin | 19.2 % | 19.3 % | Quarterly Consolidated Statements of Income (FY2023-FY2024) FedEx Freight segment's FY2024 Q4 revenue was $2,387 million, with operating income of $507 million and a strong operating margin of 21.2%, despite quarterly fluctuations | Metric | FY2023 Q1 | FY2023 Q2 | FY2023 Q3 | FY2023 Q4 | FY2024 Q1 | FY2024 Q2 | FY2024 Q3 | FY2024 Q4 | | :---------------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Revenue (million USD) | 2,849 | 2,573 | 2,293 | 2,369 | 2,385 | 2,452 | 2,205 | 2,387 | | Total Operating Expenses (million USD) | 2,192 | 2,131 | 1,906 | 1,919 | 1,903 | 1,961 | 1,864 | 1,880 | | Operating Income (million USD) | 657 | 442 | 387 | 450 | 482 | 491 | 341 | 507 | | Operating Margin | 23.1 % | 17.2 % | 16.9 % | 19.0 % | 20.2 % | 20.0 % | 15.5 % | 21.2 % | Annual Operating Statistics (FY2023-FY2024) FedEx Freight segment's total daily shipments decreased by 5.7% to 93,987 in FY2024, with a slight decline in revenue per shipment but an increase in revenue per hundredweight | Metric | FY2023 | FY2024 | Y-o-Y Growth Rate (FY24) | | :-------------------------- | :----- | :----- | :---------------- | | Daily Shipments | | | | | Priority (shipments) | 70,158 | 64,915 | (7.5 %) | | Economy (shipments) | 29,562 | 29,072 | (1.7 %) | | Total Daily Shipments (shipments) | 99,720 | 93,987 | (5.7 %) | | Revenue Per Shipment ($) | | | | | Priority ($) | 363.85 | 361.38 | (0.7 %) | | Economy ($) | 417.50 | 411.25 | (1.5 %) | | Composite Revenue Per Shipment ($) | 379.76 | 376.81 | (0.8 %) | | Revenue Per Hundredweight ($/CWT) | | | | | Priority ($) | 35.44 | 36.98 | | | Economy ($) | 45.78 | 46.86 | | | Composite Revenue Per Hundredweight ($/CWT) | 38.26 | 39.82 | | | Average Weight Per Shipment (pounds) | | | | | Priority (pounds) | 1,027 | 977 | | | Economy (pounds) | 912 | 878 | | | Composite Average Weight Per Shipment (pounds) | 993 | 946 | | Quarterly Operating Statistics (FY2023-FY2024) FedEx Freight segment's total daily shipments in FY2024 Q4 were 93,080, a 0.1% year-over-year increase, with priority revenue per shipment growing by 1.9% and economy declining by 1.2% | Metric | FY2023 Q1 | FY2023 Q2 | FY2023 Q3 | FY2023 Q4 | FY2024 Q1 | FY2024 Q2 | FY2024 Q3 | FY2024 Q4 | | :-------------------------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Total Daily Shipments (shipments) | 108,278 | 104,336 | 93,087 | 92,986 | 94,635 | 99,001 | 89,248 | 93,080 | | Daily Shipments Y-o-Y Growth Rate | (12.6 %) | (5.1 %) | (4.1 %) | 0.1 % | | | | | | Composite Revenue Per Shipment ($) | 385.61 | 377.53 | 381.77 | 373.43 | 369.56 | 381.05 | 379.26 | 377.63 | | Revenue Per Shipment Y-o-Y Growth Rate | (4.2 %) | 0.9 % | (0.7 %) | 1.1 % | | | | | | Composite Revenue Per Hundredweight ($/CWT) | 37.82 | 37.66 | 39.08 | 38.68 | 38.71 | 40.29 | 40.10 | 40.22 | | Composite Average Weight Per Shipment (pounds) | 1,020 | 1,002 | 977 | 966 | 955 | 946 | 946 | 939 | Appendix General Comments The appendix provides general comments on other operating expenses, return on assets, and return on equity calculation methodologies - Other operating expenses include costs related to external service contracts (e.g., facility services, cargo handling, temporary labor, and security), insurance, professional fees, and uniforms[30] - Return on assets and return on equity are both calculated on a rolling four-quarter basis[30] Segmentations/Restatements FedEx announced the 'one FedEx' integration plan in FY23 Q4, merging FedEx Ground and FedEx Services into Federal Express for a unified air-ground network, with FedEx Freight remaining independent and FedEx Custom Critical joining FedEx Freight from FY25 Q1 - The 'one FedEx' integration plan merges FedEx Ground and FedEx Services into Federal Express, forming a unified air-ground express network[30] - FedEx Freight will continue to operate as an independent subsidiary providing less-than-truckload freight services[30] - Effective FY25 Q1, Federal Express and FedEx Freight will be the primary reporting segments, with FedEx Custom Critical transferring from Federal Express to FedEx Freight[30] Business Optimization and Realignment Costs FY2023 included $273 million in business optimization costs and $36 million in business realignment costs, primarily related to European workforce reduction plans - FY2023 business optimization costs totaled $273 million ($209 million after-tax, $0.81 diluted EPS)[31] - FY2023 business realignment costs totaled $36 million ($27 million after-tax, $0.11 diluted EPS), related to the 2021 announced European workforce reduction plan[31] Goodwill and Other Asset Impairment Charges FY2023 included $70 million in Federal Express segment asset impairment charges related to aircraft retirement and $47 million in FedEx Dataworks goodwill and other asset impairment charges related to the ShopRunner, Inc. acquisition - FY2023 Federal Express segment asset impairment charges were $70 million ($54 million after-tax, $0.21 diluted EPS), related to the decision to permanently retire aircraft and related engines[32] - FY2023 FedEx Dataworks segment goodwill and other asset impairment charges were $47 million ($44 million after-tax, $0.17 diluted EPS), related to the acquisition of ShopRunner, Inc[32] Legal Matters FY2023 annual consolidated other operating expenses included $35 million in costs related to legal matters - FY2023 annual consolidated other operating expenses included $35 million ($26 million after-tax, $0.10 diluted EPS) in costs related to legal matters, recorded in 'Corporate, other, and eliminations'[33] Mark-to-Market Retirement Plans Accounting Adjustments FY2023 annual consolidated other retirement plan income included approximately $650 million in pre-tax non-cash benefits from mark-to-market retirement plan accounting adjustments - FY2023 annual consolidated other retirement plan income included approximately $650 million ($493 million after-tax, $1.92 diluted EPS) in pre-tax non-cash benefits from mark-to-market retirement plan accounting adjustments[33]