Logistics giant advances Freight spin-off while boosting earnings and revenue expectations
FedEx Corp. (FDX) reported solid third-quarter fiscal 2026 results, raising its full-year outlook as operational improvements and strong package demand continue to support growth. The company also confirmed it remains on track to spin off its FedEx Freight division into a separate publicly traded company by June 1, 2026.
FedEx posted revenue of $24.0 billion, up from $22.2 billion a year earlier, while adjusted diluted earnings reached $5.25 per share, compared to $4.51 in the prior year. Operating income and margins also improved, driven by higher U.S. domestic and international package yields, increased shipping volumes, and ongoing cost-saving initiatives tied to its transformation strategy.
CEO Raj Subramaniam credited disciplined execution and digital innovation for the company’s performance, highlighting how FedEx’s global network is becoming more efficient and responsive. The company’s Network 2.0 initiative and broader optimization efforts are expected to deliver over $1 billion in permanent cost reductions, reinforcing profitability.
Looking ahead, FedEx raised its fiscal 2026 guidance, now forecasting 6.0% to 6.5% revenue growth, up from its prior estimate of 5% to 6%. The company also expects adjusted earnings per share between $16.05 and $16.85, with even higher adjusted figures when excluding one-time costs related to restructuring and the planned Freight spin-off.
The upcoming separation of FedEx Freight remains a key strategic priority. The company recently completed a $3.7 billion debt issuance tied to the spin-off and plans to host an investor day in April. While the Freight segment saw some short-term pressure due to spin-off-related costs and lower shipment volumes, FedEx expects the separation to unlock long-term value for shareholders.
Additionally, FedEx is pursuing strategic expansion, including a planned minority investment in InPost, aimed at strengthening its presence in global e-commerce logistics.
Despite challenges such as higher labor costs and global trade uncertainties, FedEx’s improved outlook signals confidence in its transformation strategy and its ability to drive sustained growth and profitability in a dynamic logistics environment.
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