FedEx Reports Strong Third Quarter Results
FEDEX CORP (FDX) filed an SEC Form 8-K — Results of Operations and Financial Condition. FedEx Reports Strong Third Quarter Results Completed $2 Billion of Share Repurchases in June-September Period Raises Full-year Calendar 2026 Earnings Outlook MEMPHIS, Tenn., October 28, 2026 ... FedEx Corp. (NYSE: FDX) today reported the following consolidated results for the qua
How this was made
The 30-second read
Why it matters
The raised guidance and cash returns suggest stronger cash flow, likely supporting the stock price in the short term.
Market read
First‑hand earnings and guidance update from FedEx, a large-cap logistics company, providing actionable insight for traders.
What to watch
Potential headwinds from higher wage rates and global trade policy changes could dampen margins.
FedEx Reports Strong Third Quarter Results Completed $2 Billion of Share Repurchases in June-September Period Raises Full-year Calendar 2026 Earnings Outlook
Third-quarter revenue grew 12%, GAAP operating income grew 10%, and adjusted operating income increased to $1.20 billion from $1.03 billion. Both Express segments expanded revenue and operating income, while FedEx raised its calendar 2026 revenue-growth and adjusted EPS outlook and completed $2.0 billion of share repurchases.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenue, three months ended September 30GAAP | $22.9B | – | 12% |
| Total revenue, nine months ended September 30GAAP | $66.57B | – | 12% |
| Operating income, three months ended September 30GAAP | $1.07B | – | 10% |
| Adjusted operating income, three months ended September 30non-GAAP | $1.2B | – | – |
| Operating margin, three months ended September 30GAAP | 4.7% | – | – |
| Adjusted operating margin, three months ended September 30non-GAAP | 5.3% | – | – |
| Total operating income, nine months ended September 30GAAP | $3.31B | – | 26% |
| Income from continuing operations, three months ended September 30GAAP | $290M | – | (55%) |
| Adjusted net income from continuing operations, three months ended September 30non-GAAP | $900M | – | – |
| Net income, three months ended September 30GAAP | $290M | – | (68%) |
| Net income, nine months ended September 30GAAP | $7.20B | – | 130% |
| Diluted EPS from continuing operations, three months ended September 30GAAP | $1.21 | – | (56%) |
| Adjusted diluted EPS from continuing operations, three months ended September 30non-GAAP | $3.74 | – | – |
| Diluted EPS, three months ended September 30GAAP | $1.21 | – | (69%) |
| Diluted EPS from continuing operations, nine months ended September 30GAAP | $29.42 | – | 236% |
| Diluted EPS, nine months ended September 30GAAP | $29.89 | – | 129% |
| Salaries and employee benefits, three months ended September 30GAAP | $7.43B | – | 5% |
| Purchased transportation, three months ended September 30GAAP | $6.46B | – | 19% |
| Rentals and landing fees, three months ended September 30GAAP | $1.18B | – | 5% |
| Fuel, three months ended September 30GAAP | $1.27B | – | 64% |
| Depreciation and amortization, three months ended September 30GAAP | $967M | – | (1%) |
| Maintenance and repairs, three months ended September 30GAAP | $794M | – | 1% |
| Other, net operating expenses, three months ended September 30GAAP | $3.69B | – | 12% |
| Total operating expenses, three months ended September 30GAAP | $21.79B | – | 12% |
| Capital expenditures, three months ended September 30GAAP | $844M | – | 44% |
| Capital expenditures, nine months ended September 30GAAP | $2.86B | – | 5% |
| Cash provided by operating activities, nine months ended September 30GAAP | $7.45B | – | – |
| Cash used in investing activities, nine months ended September 30GAAP | −$5.58B | – | – |
| Cash used in financing activities, nine months ended September 30GAAP | −$486M | – | – |
| Cash and cash equivalentsGAAP | $7.96B | – | – |
| Short-term investmentGAAP | $3.25B | – | – |
| Long-term debt, less current portionGAAP | $17.30B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Express U.S. Domestic segmentOperating income was $946 million, up 7%, with higher package yields, increased package volume, improved service mix, and continued cost savings from transformation initiatives, partly offset by increased purchased transportation rates and higher salaries and benefits expenses. | $14.71B | – | 10% |
| Express International segmentOperating income was $220 million, up 15%, primarily due to increased base yields, higher international export volume, and increased freight weight, partly offset by higher wage rates, increased purchased transportation rates, and the financial impact of global trade policy changes. | $7.46B | – | 17% |
| Corporate, other, and eliminationsOperating loss was $(99) million versus $(104) million. This category includes the FedEx Office, FedEx Supply Chain, and FedEx Dataworks operating segments. | $680M | – | — |
calendar year 2026 outlook
- Revenue~12% YoY
- Tax rate~22.5%
- NoteDiluted EPS (Continuing Operations): $35.30 to $35.90
- NoteAdjusted Diluted EPS (Continuing Operations): $18.00 to $18.60
- NotePension Contributions: $475 million
- NoteCapital Spending: $3.9 billion
- NoteForecasts assume FedEx’s current economic forecast and fuel price expectations, and no additional adverse economic, geopolitical, or international trade-related developments.
Capital returns
- FedEx completed $2.0 billion in stock repurchases via open market and accelerated share repurchase transactions in June through September.
- Approximately 6.3 million shares were repurchased, with the decrease in outstanding shares benefiting third quarter results by $0.02 per diluted share.
- As of September 30, 2026, $4.3 billion remained available for repurchases under the company’s 2026 stock repurchase authorization.
- Dividends paid were $979 million for the nine months ended September 30, 2026, compared with $1,008 million for the nine months ended September 30, 2025.
What drove it
- Express U.S. Domestic total average daily package volume was 14,370 thousand, up 2%, while U.S. domestic composite revenue per package was $15.32, up 7%.
- U.S. priority revenue was $3,142 million, up 11%; U.S. deferred revenue was $1,406 million, up 8%; U.S. ground revenue was $9,545 million, up 9%; and U.S. Freight revenue was $366 million, up 16%.
- Express International total average daily package volume was 2,828 thousand, down 4%, while composite package yield was $30.46, up 17%.
- International freight revenue was $1,442 million, up 28%. Total average daily freight pounds were 18,805 thousand, up 15%, and composite freight yield was $1.20, up 11%.
- The company cited increased package base yields, higher package volumes, and continued structural cost reductions from business optimization initiatives as drivers of consolidated operating improvement.
- Effective January 4, 2027, FedEx parcel shipping rates will increase by an average of 5.9%.
Concerns
- Purchased transportation expense increased 19% to $6,455 million, fuel expense increased 64% to $1,270 million, and salaries and employee benefits increased 5% to $7,434 million in the quarter.
- GAAP net income declined 68% to $290 million and GAAP diluted EPS declined 69% to $1.21, reflecting a $1,238 million loss on short-term investment.
- Express International total average daily package volume declined 4%, including an 11% decline in international domestic average daily package volume.
- The company cited the financial impact of global trade policy changes as a partial offset to consolidated and Express International operating improvement.
- The calendar 2026 outlook assumes no additional adverse economic, geopolitical, or international trade-related developments.
What to watch
- Execution of network optimization and efficiency investments under the $3.9 billion capital-spending forecast.
- The impact of January 4, 2027 parcel rate increases averaging 5.9%.
- Further mark-to-market adjustments for the FedEx Freight investment and retirement plan accounting, which the company said are impracticable to calculate at this time and could materially affect calendar 2026 consolidated results and effective tax rate.
- Use of the remaining $4.3 billion available under the 2026 stock repurchase authorization.
- The October 1, 2026 sale of FedEx Supply Chain to CMA CGM Group for a purchase price of approximately $1.4 billion.
Balance sheet and cash flow
- Cash on-hand as of September 30, 2026 was $8 billion, including approximately $2.7 billion in IEEPA tariff refunds held for refund to customers.
- Cash and cash equivalents were $7,961 million at September 30, 2026, compared with $6,531 million at December 31, 2025.
- Long-term debt, less current portion, was $17,304 million at September 30, 2026, compared with $20,302 million at December 31, 2025.
- FedEx received an approximately $4.1 billion dividend from FedEx Freight following the spin-off and used those proceeds, along with cash on hand, to fund cash tender offers for approximately $4.9 billion aggregate principal amount of outstanding debt securities.
- Cash provided by operating activities was $7,448 million for the nine months ended September 30, 2026, compared with $6,638 million in the prior-year period.
- Capital expenditures in the cash flow statement were $3,045 million for the nine months ended September 30, 2026, compared with $2,925 million in the prior-year period.
Analysis
FedEx reported broad top-line growth in the third quarter ended September 30, 2026. Total revenue rose 12% to $22.9 billion, with Express U.S. Domestic revenue up 10% to $14,710 million and Express International revenue up 17% to $7,465 million. U.S. Domestic growth reflected both volume and pricing, as total U.S. domestic average daily package volume increased 2% and composite revenue per package increased 7%. International revenue growth was supported by a 17% increase in composite package yield and 28% growth in freight revenue, despite a 4% decline in total international average daily package volume.
Profitability improved on an adjusted basis. GAAP operating income rose 10% to $1.07 billion and adjusted operating income increased to $1.20 billion from $1.03 billion, while adjusted operating margin expanded to 5.3% from 5.1%. Express U.S. Domestic operating income increased 7% to $946 million, although its GAAP operating margin declined to 6.4% from 6.6%. Express International operating income increased 15% to $220 million, while its GAAP operating margin declined to 2.9% from 3.0%. The release attributes operating improvement to yields, volumes, service mix, and structural cost reductions, while purchased transportation, wage rates, variable compensation, fuel, and trade-policy impacts remained offsets.
GAAP earnings were heavily affected by FedEx Freight-related items. Net income was $290 million, down 68%, and GAAP diluted EPS was $1.21, down 69%. The company recognized a $1,238 million loss on its retained FedEx Freight investment in the quarter, while also recording a $627 million non-GAAP, pre-tax gain on debt extinguishment. Adjusted diluted EPS from continuing operations increased to $3.74 from $2.93. FedEx completed the FedEx Freight spin-off on June 1, 2026, retained a 19.9% ownership interest, and reported a $3.3 billion carrying value for the equity security at September 30, 2026.
Cash deployment was significant. FedEx repurchased $2.0 billion of stock in June through September, covering approximately 6.3 million shares, and reported $4.3 billion remaining under its 2026 repurchase authorization. Nine-month operating cash flow was $7,448 million, while the company reported $7,961 million of cash and cash equivalents and $17,304 million of long-term debt, less current portion, at September 30. FedEx also used FedEx Freight dividend proceeds and cash on hand for tender offers on approximately $4.9 billion aggregate principal amount of debt securities.
FedEx raised its calendar 2026 revenue-growth forecast to ~12% YoY from ~11% and increased adjusted diluted EPS guidance to $18.00 to $18.60 from $16.90 to $18.10 per diluted share. The company forecasts GAAP diluted EPS from continuing operations of $35.30 to $35.90, an effective tax rate of ~22.5%, $475 million of pension contributions, and $3.9 billion of capital spending. The outlook excludes specified mark-to-market, debt-extinguishment, restructuring, and tax items and assumes no additional adverse economic, geopolitical, or international trade-related developments.
Management, verbatim
As our strong operating results and adjusted free cash flow demonstrate, FedEx is winning across high-value market segments while we optimize our network, driving an increase to our full-year outlook.
Raj Subramaniam, FedEx Corp. president and chief executive officer
As we advance our transformation, we remain committed to disciplined operational execution to reduce our cost-to-serve while focusing on profitable growth.
Raj Subramaniam, FedEx Corp. president and chief executive officer
Our solid third quarter results and higher 2026 financial outlook reflect the focused execution of our strategy, demonstrating momentum toward our 2029 financial targets.
Claude Russ, FedEx Corp. enterprise vice president and interim chief financial officer
Not in the filing
stated, not guessed- Gross profit and gross margin were not reported.
- Quarterly operating cash flow was not reported.
- Quarterly free cash flow was not reported; the release references adjusted free cash flow without providing an amount.
- A per-share dividend was not reported.
- Prior-quarter comparisons for the reported financial and operating metrics were not reported.
- A prior outlook document was not provided, so no actual-versus-prior-guidance comparisons are presented.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
FedEx filed an 8‑K reporting Q3 2026 results and updating its full‑year outlook, including a $2 B share‑repurchase tranche.
Ticker impact
FedEx disclosed Q3 results and revised FY2026 guidance, raising revenue growth to ~12% YoY and EPS forecasts, plus $2B share repurchases.
likely upward pressure as investors price in higher revenue growth and EPS forecasts.
The filing provides fresh, material guidance upgrades and a sizable share‑repurchase program, which typically support the stock.
Market effects
Logistics and transportation peers may see relative valuation pressure as FedEx raises its outlook.
U.S. market participants may adjust exposure to parcel‑delivery stocks.
Limited to the logistics sector; no broad macro impact.
Counterpoint
If the rate‑increase and cost pressures materialize, the guidance may be overly optimistic.
Key entities
- ExecutiveRaj Subramaniam
FedEx President and CEO who commented on the results.
- ExecutiveClaude Russ
FedEx interim CFO who discussed the share‑repurchase program.
