Overview
- Adjusted EPS rose to $4.82 on $23.5 billion in revenue, topping estimates as adjusted operating margin reached 6.9% and Express margin 7.7%.
- Full‑year guide now calls for adjusted EPS of $17.80–$19.00 and 5%–6% revenue growth, with capital spending held near $4.5 billion and a $1 billion savings goal reaffirmed.
- The FAA grounding of MD‑11s removed about 4% of air capacity and reduced Q2 adjusted operating income by roughly $25 million; FedEx projects about $175 million of extra costs in the second half and expects aircraft to return in spring.
- FedEx Freight weakened on lower shipments and higher wage costs, logged about $152 million in spin‑off charges, cut its FY outlook with operating income now seen down roughly $300 million year over year, and remains slated to separate on June 1, 2026.
- B2B now contributes about 66% of revenue as FedEx shifts capacity and advances Network 2.0, with 24% of eligible volume routed through optimized facilities today and a target near 65% by next peak; several banks raised price targets after the report.