FedEx earnings fall short of expectations
FedEx on Wednesday reported higher second-quarter earnings, but the numbers fell short of analysts' expectations.
FedEx shares fell in premarket trading following the announcement. (Get the latest FedEx quote here.)
The company reported earnings of $2.14 a share, up 36 percent from $1.57 a share reported in the year earlier period.
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FedEx revenue quarterly edged up to $11.9 billion, from $11.4 billion last year.
FedEx had been expected to deliver fiscal second-quarter earnings of $2.22 a share on revenue of $11.98 billion, based on Thomson Reuters consensus estimates.
"FedEx posted strong results and a higher operating margin in the second quarter, with continued growth in volumes and base yields in each of our transportation segments," Frederick W. Smith,chairman, president, and CEO said in a statement.
The company reaffirmed its 2015 earnings guidance of $8.50 to $9.00 a share, assuming continued moderate economic growth and a modest net benefit from fuel, the company said. Capital spending was forecast at $4.2 billion.
U.S. domestic package volume increased by 7 percent, including a 10 percent increase in U.S. overnight shipping. However revenue per package fell 2 percent due to decreased fuel surcharges and lower weight.
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International package volume rose 5 percent, while international priority package volume increased 1 percent. Internationalrevenue per package was flat, with higher rates offset by unfavorable currency exchange and lower fuel surcharges.
The shipping company is gearing up to ship a record number of packages this holiday season. To avoid the logistical glitches that the company faced last year, additional trucks, workers and more than 600 planes have been added to the crew to ensure timely delivery.
FedEx shares have risen 21 per cent since the beginning of the year, while the Standard & Poor's 500 index has climbed almost 7 per cent. The stock has increased 25 per cent in the last 12 months.
—CNBC's Hailey Lee and wires contributed to this report.