Late yesterday, FedEx offered a poor outlook for fiscal 2023 and that sent its stock 21.5% lower. The company is an economic belwether and it's signif
Late yesterday, FedEx offered a poor outlook for fiscal 2023 and that sent its stock 21.5% lower. The company is an economic belwether and it’s significantly damped the mood.
“Global
volumes declined as macroeconomic trends significantly worsened later in
the quarter, both internationally and in the U.S. We are swiftly
addressing these headwinds, but given the speed at which conditions
shifted, first quarter results are below our expectations,” said Raj
Subramaniam, FedEx Corporation president and chief executive officer in a release.
“While this performance is disappointing, we are aggressively
accelerating cost reduction efforts and evaluating additional measures
to enhance productivity, reduce variable costs, and implement structural
cost-reduction initiatives. These efforts are aligned with the strategy
we outlined in June, and I remain confident in achieving our fiscal
year 2025 financial targets.”
The quesion is: Did online shopping in the pandemic skew the delivery business or is this truly a macro problem? Is this just a shift to services spending from goods, something markets were anticipating?
Also remember, FedEx offered a similar warning exactly three years ago and the economy was just fine.
In any case, S&P 500 futures are down 1.3% just ahead of the open. It won’t be a pretty one.
www.forexlive.com