Shares of FedEx (NYSE:FDX) rose in after-hours trade as the transportation services provider delivered first quarter fiscal 2024 earnings that topped expectations.
For the quarter ended August 31, FedEx (NYSE:FDX) reported earnings per share (EPS) of $4.55, up from $3.44 in the year-ago quarter and above the Street estimate of $3.68, per Zacks Consensus Estimate.
Revenue declined year-over-year, as anticipated by analysts, from $23.2 billion to $21.7 billion, slightly below the $21.8 billion expected.
The company attributed its improved 1Q earnings to its DRIVE cost-cutting initiatives which are targeting $1.8 billion in savings during fiscal 2024.
“FedEx (NYSE:FDX) Ground had an outstanding quarter which, when combined with improved earnings at FedEx (NYSE:FDX) Express and expense controls across the organization, led to our better-than-expected overall financial performance,” commented FedEx (NYSE:FDX) CEO Raj Subramaniam in a statement.
However, FedEx (NYSE:FDX) lowered its revenue forecast for fiscal 2024. It now expects revenue to be flat year-over-year compared to its prior expectation of flat to low-single-digit-percentage revenue growth.
The company also said it expects fiscal 2024 earnings per share, excluding mark-to-market retirement plans accounting adjustments and excluding costs related to its business optimization initiatives, to be $17 to $18.50 per share compared to its prior forecast of $16.50 to $18.50.
FedEx shares gained 4.2% to US$260.75 shortly after the release of its results.
Contact the author at emily.jarvie@proactiveinvestors.com
Follow her on Twitter @emilyjjarvie