Core Insights - FedEx Freight is set to become a standalone public company by June next year, with plans to invest $600 million in IT infrastructure ahead of the spinoff [1] - FedEx reported consolidated adjusted earnings per share of $3.83 for its fiscal first quarter, exceeding consensus estimates by $0.22 and showing a year-over-year increase of $0.23 [2] - FedEx Freight's revenue for the quarter was $2.26 billion, reflecting a 3.1% year-over-year decline, with tonnage per day down 2.5% and revenue per hundredweight down 0.6% [3] Financial Performance - FedEx Freight's operating ratio was reported at 84%, which is 280 basis points worse year-over-year, impacted by $9 million in separation costs related to the spinoff [5] - The decline in revenue and a 100-basis point increase in salaries, wages, and benefits as a percentage of revenue were significant factors in the financial performance [6] - For the fiscal year ending May 31, FedEx Freight's revenue is expected to increase by a low-single-digit percentage year-over-year, with modest yield improvements anticipated in the latter half of the year [7] Market Conditions - The Purchasing Managers' Index (PMI) for August was 48.7, indicating negative territory for 32 of the past 34 months, with the new orders subindex moving into expansion territory at 51.4 [4] - The LTL market is described as "rational," but top-line trends are constrained by a weak industrial economy and share loss to the truckload market, where capacity is abundant and rates are low [3]