MEMPHIS (dpa-AFX) - Shares of FedEx Corp. (FDX) slipped 10% on extended trading session on Tuesday after the package delivery giant's results for the first-quarter fell short of estimates, due to negative impact of 'weakening global macro environment.' The company also detailed a weak outlook for full year 2020.
Memphis, Tennessee-based FedEx's first-quarter profit dropped to $745 million or $2.84 per share from $835 million or $3.10 per share last year.
Adjusted earnings for the quarter were $3.05 per share, down from $3.46 per share last year. On average, 22 analysts polled by Thomson Reuters expected earnings of $3.16 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter remained flat at $17.05 billion compared to last year. Wall Street analysts had a consensus estimate of $17.06 billion.
'Our performance continues to be negatively impacted by a weakening global macro environment driven by increasing trade tensions and policy uncertainty,' said CEO Frederick Smith. 'Despite these challenges, we are positioning FedEx to leverage future growth opportunities as we continue the integration of TNT Express, enhance FedEx Ground residential delivery capabilities and modernize the FedEx Express air fleet and hub operations.'
The company said its operating results declined primarily due to weakening global economic conditions, increased costs to expand service offerings and continued mix shift to lower-yielding services.
Being global transportation companies, the performance of shipping giants like FedEx and its rival United Parcel Service Inc. (UPS) are considered a strong barometer of overall consumer attitude and economy.
Looking forward to the full year 2020, the company forecasts adjusted earnings between $11 and $13 per share. Analysts currently estimate earnings of $14.70 per share.
FDX closed Tuesday's trading at $173.30, down $0.27 or 0.16%, on the NYSE. The stock further slipped $16.57 or 9.56% in the after-hours trade.
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