FedEx Corp. is showing signs of strain from the mandatory grounding of its MD-11 freighter fleet during the year’s busiest shipping season as travel managers are unable to keep up with an unprecedented number of flight changes, leaving many arriving pilots without confirmed accommodations after long trips. Hotel and ground transportation reservations are typically made weeks, or months, in advance of a trip, but FedEx (NYSE: FDX) acknowledged that the department responsible for booking those services for ...

Core Insights - UPS has experienced significant changes in recent months, with its shares facing pressure due to increased competition in the Air Freight and Logistics sector and challenges with USPS [1] Company Overview - UPS is a prominent player in the Industrials sector, particularly in Air Freight and Logistics, which has seen rising competition impacting its stock performance [1] Market Dynamics - The company has been under pressure for years, indicating a challenging market environment that includes competition and operational difficulties [1]

SHANGHAI, Dec. 11, 2025 (GLOBE NEWSWIRE) -- Recently, the all-cargo "Cold Chain Express" aircraft CK292 of China Eastern Air Logistics carried 88.75 tons of fresh cherries from Chile to China. After a brief stopover, the aircraft touched down at Shanghai Pudong International Airport, completing the journey in just 24 hours and setting another record for Chilean cherry imports to China. This milestone also marks the official launch of China Eastern Air Logistics' dedicated cherry charter program for the new ...

Core Thesis - FedEx Corporation is viewed positively due to its strong market position, economic moat, and robust shareholder returns, despite some challenges in revenue growth and capital allocation [1][3][4]. Company Overview - FedEx operates globally in air freight and logistics, providing a wide range of services including express shipping, freight, e-commerce solutions, and warehousing [2]. - The company has a narrow economic moat, benefiting from cost efficiency and economies of scale in its delivery networks [2]. Financial Performance - Over the past five years, FedEx achieved mid-single-digit annualized revenue growth, which lagged behind the S&P 500, and net profit margins also underperformed the broader market [3]. - The company returned $3 billion to shareholders in fiscal 2025 through an active stock buyback program, which continues into fiscal 2026 [3]. - Owners' earnings, measured via five-year trailing EPS growth plus dividend growth, were in the high double digits, with a strong return to shareholders at 35.3% [4]. Investment Proposition - FedEx's fundamentals are rated as neutral, but its global scale, comprehensive logistics capabilities, and consistent free cash flow generation support a bullish value proposition for long-term investors [4]. - The stock presents potential for dividend income and capital appreciation, appealing to investors seeking exposure to a resilient logistics platform [4]. Market Position - Despite leadership changes, including founder Fred Smith's transition to executive chairman, FedEx remains a strong industry player [3]. - The company's stock price has depreciated approximately 8.32% since previous coverage, but the bullish thesis on its market leadership and operational efficiency still stands [5][6].

Financial Performance - UPS's net income has significantly decreased, with $6.7 billion and $5.8 billion reported in the previous two years, and a current net profit of $3.8 billion for the first three quarters of 2025 [1] - The pilot group at UPS has expanded due to a transport contract with the U.S. Postal Service and overall market strength, growing from 3,200 pilots three years ago [1] Labor Relations and Contract Negotiations - UPS pilots extended their contract in 2022 for two additional years to allow the Teamsters union to negotiate for ground workers, with the pilot contract eligible for amendment since September 1 [2] - The National Mediation Board has facilitated talks between UPS and the Independent Pilots Association (IPA), representing 3,500 UPS pilots, after 18 months of stalled negotiations [3] - Initial negotiations with a federal mediator occurred via video conferencing, with in-person discussions scheduled to move to Boston in January [4] Industry Context - UPS and FedEx pilots are advocating for better pay and benefits, citing their contributions during the COVID-19 pandemic that helped maintain profit growth [5] - The grounding of over 60 MD-11 freighters has left hundreds of UPS and FedEx pilots idle, impacting contract negotiations [7][13] - Labor relations in the airline industry are governed by the Railway Act, which restricts strikes and lockouts until extensive bargaining steps are completed [8] FedEx Comparison - FedEx pilots are also experiencing prolonged contract negotiations, with their talks starting in March 2021 and currently in federal mediation [13] - FedEx's recent offer included a 24% immediate pay increase and a total of 40% over the agreement's duration, aiming to make its pilots the highest paid in the cargo industry [19]

Core Viewpoint - FedEx expects minimal disruption in shipping operations due to the grounding of its MD-11 freighter fleet, as inspections can be completed quickly and alternative aircraft have been deployed to maintain capacity [1][5]. Group 1: Regulatory Actions and Inspections - The Federal Aviation Administration (FAA) ordered FedEx, UPS, and Western Global Airlines to pause MD-11 operations following a fatal crash of a UPS MD-11, which resulted in 14 fatalities [2]. - FedEx will begin inspecting 25 of its MD-11 aircraft in the coming days, with a total of 34 MD-11s in its fleet, of which six are inactive and three are spares [3]. - Inspections will focus on the engines and engine mounts, and aircraft will be returned to service on a tail-by-tail basis after inspection [4]. Group 2: Operational Adjustments - FedEx is leveraging its global network to replace the lost MD-11 capacity, which is crucial during the peak shipping season as retailers prepare for the holidays [5]. - The company is activating spare aircraft, postponing routine maintenance on other aircraft, and routing shipments through commercial airline partners to mitigate the impact of the grounded MD-11s [6]. - Additionally, FedEx is shifting more packages to its domestic ground network, as 18 of the 25 operational MD-11s are used for domestic flights [6]. Group 3: Impact of Government Regulations - The grounded MD-11s count towards the FAA's target for airlines to reduce flight schedules amid a government shutdown, which has led to a 4% cancellation rate of flights, expected to rise to 10% by November 14 [7].

Core Points - The incident led to injuries and prompted a shelter-in-place order for all locations within five miles of the airport [1] - The airport is recognized as one of the busiest cargo airports globally and serves as the global air freight hub for UPS [1]

Summary of Expeditors International of Washington (EXPD) Update / Briefing July 29, 2025 Company and Industry Overview - **Company**: Expeditors International of Washington (EXPD) - **Industry**: Air Cargo and Logistics Key Points and Arguments Air Market Dynamics - The air market update focuses on the Americas, discussing capacity, demand, and geopolitical influences affecting air cargo [6][7] - Global air capacity grew by 4% in the first half of 2025 compared to 2024, with a notable 44% increase on the Transpacific route [8][9] - Freighter capacity specifically saw a decline of 3% in both directions between Asia and the US, while freighter deployment to Europe increased by 8% [11][12] - The ecommerce sector is experiencing a shift, with a significant reduction in ecommerce volumes flying into the US due to the end of de minimis exemptions [29][30] Geopolitical and Trade Influences - Geopolitical tensions and trade barriers are reshaping air cargo routes, with a notable shift from US-bound cargo to Europe and Southeast Asia [36][38] - The ongoing trade negotiations and tariff changes are creating uncertainty, impacting supply chains and air freight demand [47][61] - The Chinese economy is facing multiple headwinds, affecting its trade relationships and demand for air cargo services [51][52] Capacity and Demand Trends - The demand for air freight has been healthy, with a 6.6% growth in global air demand in Q1 2025, but is expected to level off to around 3-4% for the rest of the year [21][24] - The inventory-to-sales ratio is a critical indicator, with lower inventory levels indicating higher demand for air freight [23] - Vietnam has emerged as a significant exporter to the US, with a 55% growth in the first five months of 2025 compared to 2024, driven by the tech sector [44][45] Future Outlook - The expectation for new aircraft deliveries has been pushed back to 2027-2028, leading to an aging fleet and increased maintenance needs [19][20] - The air cargo market is expected to continue adjusting to shifting trade patterns, with potential increases in rates for US outbound cargo if demand rises without corresponding capacity [84][85] - The geopolitical landscape is likely to remain volatile, impacting global supply chains and air freight dynamics [75][76] Other Important Insights - The webinar highlighted the importance of adapting to changing trade policies and the need for companies to reassess their supply chain strategies in light of geopolitical tensions [58][60] - The discussion emphasized the role of ecommerce in driving air cargo demand and the challenges faced by companies in navigating regulatory changes [29][30][31] - The potential for increased investment in infrastructure, particularly in Vietnam, to support growing demand was noted as a positive development [45][46]

Core Insights - FedEx reported strong fourth-quarter fiscal 2025 results, beating both earnings and revenue estimates, but provided a dismal outlook, leading to a more than 5% drop in shares after market close [1][3] Financial Performance - Earnings per share for FedEx were $6.07, surpassing the Zacks Consensus Estimate of $5.93 and improving from $5.41 a year ago [3] - Revenues increased by 0.5% year over year to $22.2 billion, exceeding the consensus estimate of $21.7 billion [3] Future Outlook - For the first quarter of fiscal 2026, FedEx expects revenues to be flat or increase by up to 2%, with adjusted earnings per share projected between $3.40 and $4.00 [4] - The Zacks Consensus Estimate for revenues indicates a growth of 0.21%, while the estimate for earnings per share is $4.05 [4] - FedEx did not provide earnings and revenue forecasts for fiscal 2026 due to uncertainties surrounding U.S. trade policies, particularly with China [5] Cost Management - FedEx achieved its $4 billion cost-cutting goal and aims to trim an additional $1 billion in the upcoming fiscal year [5] ETF Impact - The sluggish trading is expected to affect ETFs with high allocations to FedEx, including ProShares Supply Chain Logistics ETF, iShares U.S. Transportation ETF, First Trust Nasdaq Transportation ETF, and Pacer Industrials and Logistics ETF [2] ETF Details - ProShares Supply Chain Logistics ETF holds 40 stocks, with FedEx accounting for 4.6% of assets, and has an asset base of $0.9 million [6][7] - iShares U.S. Transportation ETF includes 44 securities, with FedEx making up 4.5% of assets and has $657.1 million in AUM [8][9] - First Trust Nasdaq Transportation ETF tracks 38 transportation securities, with FedEx accounting for 3.6% of the basket and has an asset base of $28.4 million [10][11] - Pacer Industrials and Logistics ETF tracks 109 stocks, with FedEx representing 3.1% of the holdings and has accumulated $1.6 million in assets [12][13]

Core Viewpoint - New Century Logistics (BVI) Limited has signed a Letter of Intent to acquire 51% of Asiatic Logistics Limited, aiming to enhance its presence in Asia and develop a comprehensive global logistics ecosystem [1][2] Group 1: Acquisition Details - The acquisition of 51% equity in Asiatic represents a strategic upgrade from previous cooperation, focusing on shared benefits and operational synergies [2] - The specifics of the acquisition, including purchase price and payment terms, will be finalized in a formal agreement considering Asiatic's financial performance and market conditions [4] Group 2: Strategic Importance - The acquisition is expected to strengthen New Century's position in the Asian market, particularly by leveraging Asiatic's established network and services in Japan and Southeast Asia [6] - New Century plans to designate Japan as a key strategic hub, enhancing regional and transcontinental operations [5] Group 3: Operational Synergies - The integration of Asiatic's operations with New Century's existing routes will create a seamless logistics corridor connecting Asia, Europe, and the Middle East [6] - Collaboration will include sharing resources such as warehousing and transportation, optimizing costs and improving market penetration [6] Group 4: Future Plans - New Century aims to develop customized e-commerce logistics products in response to the growth of the Japanese cross-border e-commerce market, offering expedited logistics services [11] - The company plans to enhance digital capabilities by integrating its supply chain visualization system with Asiatic's management platform for improved cargo tracking and efficiency [11]