Amid volatile macroeconomic conditions, weaker demand has hit revenue outlook of package delivery giant FedEx. The shares fell 12% after FedEx cut its revenue forecast.
.The company said it expects a low-single-digit decline in revenue for the fiscal year, down from a previous forecast for flat sales year over year. Analysts had expected a revenue drop of less than 1% in the current fiscal year.
It's the second consecutive quarter FedEx has lowered its sales outlook. The company's Express unit, its largest, was especially challenged in the quarter with lower demand, surcharges and customers shifting to cheaper services.
In the remainder of fiscal 2024, FedEx expects revenue will continue to be pressured by volatile macroeconomic conditions, negatively affecting customer demand for its services across its transportation companies. The company said, however, that operating income would improve thanks to its cost-cutting plan.
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