FedEx (NYSE:FDX) is down sharply after FQ1 profit arrives short of expectations.
Operating income fell 12% to $1.05B during the quarter on an operating margin rate of 6.1%. "Our performance continues to be negatively impacted by a weakening global macro environment driven by increasing trade tensions and policy uncertainty," says CEO Fred Smith. The loss of business from a "large customer" (Amazon) was also noted as a negative factor.
Looking ahead, FedEx lowers its FY20 revenue and earnings outlook due to increased trade tensions and additional weakening of global economic conditions since the company’s initial FY20 forecast in June. The company's revised outlook also reflects increased FedEx Ground costs and August’s loss of FedEx Ground business from a large customer. FedEx now sees EPS of $11.00 to $13.00 vs. $14.62 consensus.
Shares of FedEx are down 7.97% AH to $159.71.
Previously: FedEx EPS misses by $0.11, revenue in-line (Sept. 17)
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