Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from Debt [USD, Millions]

Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

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60f0ba9503fbcde5104d636eed3c37caba13e38206f4426b5617513de89803b8

Total Revenue [USD, Millions]

Cost of Goods Sold (COGS) [USD, Millions]

SG&A [USD, Millions]

R&D [USD, Millions]

D&A [USD, Millions]

Interest Expense [USD, Millions]

Operating Income (EBIT) [USD, Millions]

Net Income [USD, Millions]

EPS - Basic [USD, Per Share]

EPS - Diluted [USD, Per Share]

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In Q2 2025, FedEx’s cash and cash equivalents dropped significantly primarily due to substantial outflows from financing and investing activities. The company executed **share repurchases of $2,020 million** and made **dividend payments of $676 million**, in addition to incurring **capital expenditures of $1,585 million**. These cash outflows, combined with a **drop in cash generated from operating activities** and a **negative impact of $62 million from exchange rate changes**, contributed to the decline from **$6,501 million to $5,029 million** during the period.  **[0000950170-24-138448_fdx-ex99_1.htm:8]** **[0000950170-24-138460_fdx-20241130.htm:38]** **[0000950170-24-138460_fdx-20241130.htm:3]** 

Why did cash and cash equivalents drop so low in Q2 2025?

The decline in **Total Assets** in Q2 2025 was primarily driven by a significant **reduction in cash and cash equivalents**—a drop of **$1,472 million** due to cash used in both financing activities (notably **treasury stock purchases** and **dividend payments**) and investing activities (primarily **capital expenditures**). Additionally, there were declines in **Goodwill** by **$133 million** and in **Other Long-Term Assets** by **$128 million**, which further contributed to the overall decline, partially offset by minor increases in receivables and spare parts, supplies, and fuel.  **[0000950170-24-138448_fdx-ex99_1.htm:8]** **[0000950170-24-138460_fdx-20241130.htm:3]** 

What factors contributed to the decline in total assets in Q2 2025?

The unusually high current portion of long-term debt in Q1 2025 is attributed to a reclassification of debt that is now due within the next 12 months. This reclassification, a standard accounting practice when debt nears its maturity, resulted in an increase from **$68 million as of Q3 2024** to **$622 million in Q1 2025**.  **[0000950170-24-108098_fdx-ex99_1.htm:8]** **[0000950170-24-108107_fdx-20240831.htm:2]** 

Why is the current portion of long-term debt unusually high in Q1 2025?

1a1d38e13eb7edc47028ce8bfeed7e8bce8830b40bda21821e2b401ddf80299d

FedEx’s operating income dropped significantly in Q1 2025 primarily due to a **27% decrease** year-over-year, driven by several factors. First, there was a **shift in service mix** from higher-margin priority services to lower-margin deferred services, which constrained yield growth and negatively impacted revenue flow-through.  **[0000950170-24-108107_fdx-20240831.htm:24]** **[0000950170-24-108098_fdx-ex99_1.htm:0]** **[FDX_3401870_6]**  Additionally, the quarter had **one fewer operating day**, resulting in an estimated **$170 million** headwind to operating income.  **[0000950170-24-108107_fdx-20240831.htm:24]** **[FDX_3401870_6]**  Higher operating expenses also played a role—**purchased transportation costs** increased by **5%**, and there were **increased wage rates** and retirement benefits despite cost-reduction initiatives.  **[0000950170-24-108107_fdx-20240831.htm:25]**  Furthermore, **macroeconomic and demand challenges**, including a weak industrial economy, declining U.S. domestic priority service volumes, and pressures from elevated inflation and interest rates, further constrained revenue.  **[0000950170-24-108107_fdx-20240831.htm:22]** **[FDX_3401870_1]**  Lastly, **increased business optimization costs** (rising from **$105 million** to **$128 million**) and the impact of **lower fuel surcharges** contributed to the decline, reducing operating margins from **6.8%** in Q1 2024 to **5.0%** in Q1 2025.  **[0000950170-24-108107_fdx-20240831.htm:24]** **[0000950170-24-108107_fdx-20240831.htm:22]** **[0000950170-24-108107_fdx-20240831.htm:25]** **[0000950170-24-108107_fdx-20240831.htm:23]** **[0000950170-24-108098_fdx-ex99_1.htm:7]** 

Why did Operating Income drop significantly in Q1 2025?

The steep decline in FedEx’s net income in Q1 2025 was caused by a combination of factors. **Revenue and volume trends** played a key role, as there was a global decline in priority volume and an increase in deferred volume, which limited yield growth. Additionally, **higher operating expenses**—driven by increased wages, higher purchased transportation rates, and one fewer operating day—added a significant headwind. Although FedEx achieved some **structural cost savings** through its DRIVE initiatives, these savings fell short of expectations in terms of timing, failing to fully offset revenue and expense pressures. Moreover, **segment performance issues** in both the Express and Freight divisions weakened operating income, and **macroeconomic factors** such as slowed industrial production, declining U.S. imports, as well as elevated inflation and interest rates further contributed to the decline.  **[0000950170-24-108098_fdx-ex99_1.htm:0]** **[0000950170-24-108098_fdx-ex99_1.htm:7]** **[0000950170-24-108107_fdx-20240831.htm:23]** 

What caused the steep decline in Net Income in Q1 2025?

The surge in Basic EPS in Q4 2024 was driven by a combination of factors. **Cost savings initiatives**, notably through the DRIVE Program, delivered **$1.8 billion in structural cost reductions** that helped boost profitability.  **[FDX_3392724_1]**  **Improved operating margins** in key segments—especially within FedEx Ground and FedEx Freight—further contributed to the rise.  **[0000950170-24-077290_fdx-ex99_1.htm:16]**  In addition, **lower capital intensity** (with CapEx decreasing from **$6.17 billion to $5.18 billion**) and **share repurchases** totaling **$3.8 billion** helped reduce the share count, positively impacting EPS.  **[0000950170-24-077290_fdx-ex99_1.htm:0]** **[FDX_3392724_6]** **[FDX_3392724_1]**  Finally, a **noncash MTM retirement plans adjustment** resulted in a **$561 million pre-tax gain** (equating to **$1.69 per diluted share**) in Q4 2024, providing an extra boost to the earnings per share.  **[0000950170-24-102826_fdx-ex99_1.htm:4]** **[0000950170-24-083577_fdx-20240531.htm:64]** 

What drove the surge in Basic EPS in Q4 2024?

Revenue declined in Q2 2025 due to a mix of factors. **FedEx** experienced a **1% decrease** compared to Q2 2024, driven primarily by a **weaker U.S. industrial economy** that dampened demand—especially impacting the **FedEx Freight segment**, which saw an **11% year-over-year decline in revenue**. Additionally, the **expiration of the USPS contract** on September 29, 2024, reduced revenue in the Federal Express segment, while **lower fuel surcharges** (resulting from declining fuel prices) and a **shift toward lower-yielding services** such as Ground Economy further contributed to the drop. Although international export package volumes increased by **9%**, this growth did not fully compensate for domestic weaknesses.  **[0000950170-24-138460_fdx-20241130.htm:27]** **[0000950170-24-138448_fdx-ex99_1.htm:7]** **[FDX_3411971_5]** **[0000950170-24-138448_fdx-ex99_1.htm:0]** **[0000950170-24-138460_fdx-20241130.htm:24]** **[FDX_3411971_16]** 

Why did Revenue decline in Q2 2025?

19c590cc39dd02919b9cb86a88e9440755b4618c7189c74f7a125973ac6da4b3

Net income (USD, millions)

Depreciation and amortization (USD, millions)

Provision for uncollectible accounts (USD, millions)

Other noncash items including leases and deferred income taxes (USD, millions)

Stock-based compensation (USD, millions)

Business optimization costs, net of payments (USD, millions)

Other, net (USD, millions)

Cash provided by operating activities (USD, millions)

Capital expenditures (USD, millions)

Purchase of investments (USD, millions)

Proceeds from sale of investments (USD, millions)

Proceeds from asset dispositions and other (USD, millions)

Cash used in investing activities (USD, millions)

Principal payments on debt (USD, millions)

Proceeds from stock issuances (USD, millions)

Dividends paid (USD, millions)

Purchase of treasury stock (USD, millions)

Other (USD, millions)

Cash used in financing activities (USD, millions)

Effect of exchange rate changes on cash (USD, millions)

Net decrease in cash and cash equivalents (USD, millions)

Receivables (USD, millions)

Other assets (USD, millions)

Accounts payable and other liabilities (USD, millions)

Cash and cash equivalents at beginning of period (USD, millions)

Cash and cash equivalents at end of period (USD, millions)

af0e3e2acbc6c965033eb0ab2d14e7c6cb4c70fd5ba413fdd3881ac14dc56c5d

U.S.

International

- FedEx Express

- FedEx Ground

- FedEx Freight

- FedEx Services

- Other

Total Revenue

e0fb165103b0262960579bffc2d62419bb16b897962fe50475d3ed00c6e8fd15

Revenue (USD, millions)

Salaries and employee benefits (USD, millions)

Purchased transportation (USD, millions)

Rentals and landing fees (USD, millions)

Fuel (USD, millions)

Maintenance and repairs (USD, millions)

Business optimization costs (USD, millions)

Other Operating Expenses (USD, millions)

Total Operating Expenses (USD, millions)

Operating Income (USD, millions)

Interest, net (USD, millions)

Other retirement plans income (expense) (USD, millions)

Other, net (Other Expense/Income) (USD, millions)

Total Other Income (Expense) (USD, millions)

Income Before Income Taxes (USD, millions)

Provision for Income Taxes (USD, millions)

Net Income (USD, millions)

Basic Earnings Per Common Share (USD)

Diluted Earnings Per Common Share (USD)

Dividends Declared Per Common Share (USD)

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a10b61917f8047ffba4811001e5f9184806066cf96052ea55b9de9ffa73c18a8

FedEx Corp (FDX)

Financials