Memphis-based freight transportation and logistics services provider FedEx turned in solid fiscal fourth quarter earnings announced late yesterday.
Quarterly revenue, at $25.0 billion, increased 13% annually, and operating income, at $1.551 billion, fell 13% annually. Adjusted earnings per share, at $6.31, beat Wall Street estimates, at $5.96.
“Team FedEx delivered an impressive finish to a strong fiscal year, providing excellent service to our customers and successfully executing on our transformation initiatives,” said Raj Subramaniam, FedEx Corp. president and chief executive officer. “Our profitable growth strategy is working. We are building momentum across our global industrial network, driving structural improvements and winning in high-value growth markets. With the successful spin-off of FedEx Freight, we are entering this next chapter positioned to grow while further optimizing our network, lowering our cost to serve, creating meaningful long-term value, and driving robust free cash flow.”
FedEx Express revenue, at $21.570 billion, increased 14% annually. FedEx attributed the revenue gain to higher U.S. domestic and International Priority package yields, continued cost savings from transformation initiatives, and increased U.S. domestic and international export package volume. And it added that these drivers were partially offset by increased purchased transportation and wage rates, higher variable incentive compensation expenses, and the financial impact of global trade policy changes.
Total quarterly package revenue, at $19.570 billion, rose 13% annually: total U.S. domestic package revenue, up 13%, to $14.181 billion, total International export package revenue, at $4.209 billion, up 15% annually, and International domestic, at $1.180 billion, up 6%.
Total U.S. domestic average daily package volume, at 14.225 million, saw a 3% annual gain, and total International domestic average daily package volume, at 1.687 million, was off 9% annually. And total average U.S. domestic composite package yield, at $15.58, was up 10% annually, and total average International domestic package yield, at $10.93, was up 16% annually. Total quarterly composite yield, at 17.90, rose 11%.
In its final earnings release as part of FedEx, as it’s spin-out into a separate, publicly-traded company went into effect on June 1, FedEx Freight, the company’s longtime less-than-truckload subsidiary, saw quarterly revenue rise 18% annually, to $1.665 billion.
“Each quarter of this fiscal year, we delivered on our financial commitments while supporting our customers with excellence,” said Subramanian on the company’s earnings call. “Our results demonstrate that we are growing revenue in the most premium segments of the global economy. As trade patterns evolve, we flex our network to keep supply chains moving. Our network transformation via Network 2.0, Tricolor, and opportunities in Europe is driving better density and efficiency. This progress, combined with a sharp focus on structural cost reduction, enabled us to exceed the $1 billion transformation-related savings target that we shared at the start of the fiscal year. And our data and technology advantage is helping us win new business, improve the customer experience, and create new value.”
And Brie Carere executive VP & chief customer officer, at FedEx, noted on the call that the company’s focus on premium B2B verticals and high-value B2C helped to grow volume and yield every quarter of fiscal year ’26.
“As a result, we profitably increased revenue by nearly $7 billion compared to last year, a truly impressive achievement,” said Carere. “We have continued to help our customers navigate a very dynamic and complex environment. The implementation of global trade policy changes, geopolitical unrest in the Middle East and the IEEPA refund process. In April, we began to file claims with CBP on behalf of our customers. And beginning in August, we will be passing these refunds through to our customers.”
In an initiative that she said has been years in the making, Carere said that FedEx’s B2B business continues to make strides, as evidenced by a 3.5% quarterly gain, with the company repivoting its commercial team to focus on what she called “core B2B,” as well as getting back to its roots as the industrial heartbeat of the global economy.
To that end, she explained that the AI and data center space is an emerging and rapidly scaling growth engine for FedEx, delivering double-digit revenue growth.
“Rather than a narrow vertical, this space represents a horizontal ecosystem,” she said. “We are capturing demand across the entire value chain from traditional hyperscalers to the industrial and power infrastructure that support these massive build-outs. What differentiates FedEx here is our unmatched responsiveness and our premium capabilities, leveraging network priority, near real-time monitoring and white glove handling. We are getting very positive feedback from our customers on our agility.”
Full-year fiscal 2026 revenue, at $94.7 billion posted an 8% annual gain, and operating income, at $5.46 billion, was up 5% annually. FedEx said that these results reflect lower structural costs as the company exceeded its goal of $1 billion of transformation-related costs savings throughout the fiscal year. Looking ahead, FedEx said it expects calendar year 2026 revenue to increase by around 11%, with adjusted EPS pegged to come in between $16.90-to-$18.10.
