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FedEx Earnings Are Coming. Don’t Expect Good News.

Sep 18, 2025 02:00:00 -0400 by Al Root | #Transportation #Earnings Preview

Sales growth has been hard to achieve for FedEx lately. Revenues in fiscal year 2025 totaled about $88 billion, down from a fiscal year 2022 peak of $93.5 billion. (David Dee Delgado/Getty Images)

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Investors haven’t been optimistic about the outlook for logistics lately. That isn’t likely to change when FedEx reports fiscal first-quarter numbers on Thursday evening.

For the quarter ended in August, Wall Street projects FedEx earnings per share of $3.63 from sales of $21.7 billion, according to FactSet. A year ago, in the first fiscal quarter of 2025, FedEx reported earnings per share of $3.60 from sales of $21.6 billion.

Sales are expected to inch higher, but generating sales growth has been a struggle for logistics providers lately. Volumes have been impacted by a post-Covid slowdown and higher costs due to tariffs. FedEx revenues in fiscal year 2025 were about $88 billion, down from a fiscal year 2022 peak of $93.5 billion.

Wall Street projects fiscal 2026 sales of about $89 billion.

That call might be optimistic. Evercore ISI analyst Jonathan Chappell and BofA Securities analyst Ken Hoexter both recently cut their ratings on FedEx stock to Hold from Buy. Hoexter’s price target for FedEx stock went to $240 from $245. Chappell reduced his price target to $243 from $249 a share.

Both cited pressure on delivery volumes, partly due to President Donald Trump’s executive order that ends the tariff-free treatment of “de minimus” parcels—small, low-value packages that companies such as Temu and Shein had been able to ship from China to the U.S. without paying taxes and duties on them.

The de minimus problem also led Susquehanna analyst Bascome Majors to cut his fiscal year 2026 EPS estimate by 90 cents to $17.40. The consensus call on FactSet is $18.37.

What’s more, JPMorgan analyst Brian Ossenbeck wrote recently that he was taking a “negative view on FedEx into the earnings release,” citing stagnant business-to-business demand and weak consumer trends. He cut his full-year 20206 estimates to $17.50 from $18.20.

Both Ossenbeck and Majors rate FedEx stock Buy and have $285 price targets for the stock. Overall, 59% of analysts covering FedEx stock rate shares Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for FedEx stock is about $263.

FedEx stock fell 0.8% to $225.78 on Wednesday, while the S&P 500 fell 0.1% and the Dow Jones Industrial Average rose 0.6%.

The silver lining for pessimistic investors could be that FedEx shares are already beaten up. Coming into Thursday trading, FedEx stock was down roughly 24% over the past 12 months. The stock trades for about 12 times earnings estimated over the coming 12 months, down from a historic average of closer to 13 times.

In June, FedEx reported adjusted earnings per share of $6.07 from sales of $22.2 billion. Wall Street was looking for earnings per share of $5.87 from sales of $21.8 billion, according to FactSet.

Earnings were better than expected, but FedEx didn’t provide typical full-year earnings-per-share guidance in its news release. The economic outlook was too uncertain. Instead, the company provided guidance for the quarter ending in August. The earnings-per-share range given was $3.40 to $3.60. Wall Street was projecting $4.05 at the time. FedEx shares dropped 3.3% in response.

Guidance of the full fiscal year or the quarter ending in November will be something else for investors to watch for.

Write to Al Root at allen.root@dowjones.com