FedEx Raises Calendar 2026 Outlook After Freight Spin

The Tip Desk · October 30, 2026 · 3 min read

The parcel carrier lifted calendar 2026 revenue growth to about 12% from about 11% and adjusted diluted EPS to $18.00–$18.60 after a $22.9 billion third-quarter sales print.

FedEx Corp. (FDX) raised its calendar 2026 earnings outlook after reporting $22.9 billion of third-quarter revenue, a 12% increase from $20.4 billion a year earlier, and lifting full-year revenue growth to about 12% from a prior forecast of about 11%.

The Memphis-based parcel and air-freight company also lifted adjusted diluted earnings from continuing operations for calendar 2026 to $18.00 to $18.60 a share, from a prior range of $16.90 to $18.10. GAAP diluted EPS from continuing operations is now forecast at $35.30 to $35.90, versus a prior $16.55 to $17.75 that had excluded mark-to-market accounting on the FedEx Freight investment and a gain on extinguishment of debt. The company lowered its expected effective tax rate to about 22.5% from about 23%. Pension contributions of $475 million and capital spending of $3.9 billion were left unchanged.

Reported results were distorted by items tied to the June 1 spin-off of FedEx Freight. GAAP net income from continuing operations was $0.29 billion, or $1.21 a share, down from $0.65 billion, or $2.73 a share, a year earlier. Adjusted net income was $0.90 billion, or $3.74 a share, versus $0.69 billion, or $2.93 a share.

FedEx recognized a $1.2 billion loss on its retained 19.9% equity stake in FedEx Freight, which was carried at $3.3 billion at Sept. 30. Cash from an approximately $4.1 billion dividend from Freight, plus cash on hand, funded tender offers of about $4.9 billion of debt, producing a $627 million pre-tax gain. Restructuring, exit and other costs reduced GAAP earnings by $0.68 a share.

Consolidated operating income from continuing operations was $1.07 billion, or a 4.7% margin, versus $0.97 billion, or 4.8%, a year earlier. Adjusted operating income was $1.20 billion, or a 5.3% margin, versus $1.03 billion, or 5.1%. The company said results improved on higher package base yields, higher package volumes and structural cost reductions from business-optimization initiatives, partially offset by higher purchased transportation rates, higher wages and variable compensation, and the financial impact of global trade-policy changes.

Express U.S. Domestic, the larger of the two reportable segments, posted GAAP operating income of $946 million on $14.71 billion of revenue, a 6.4% margin. Adjusted segment operating income was $972 million, or a 6.6% margin. The company attributed the increase to higher package yields, increased volume, improved service mix and transformation cost savings, partly offset by purchased transportation and salaries.

Express International generated GAAP operating income of $220 million on $7.47 billion of revenue, a 2.9% margin. Adjusted operating income was $297 million, or a 3.9% margin. The company said the increase came primarily from higher base yields, higher international export volume and increased freight weight, partly offset by wages, purchased transportation and trade-policy effects.

On Oct. 1, FedEx completed the sale of FedEx Supply Chain to CMA CGM Group for about $1.4 billion. A $263 million deferred income tax benefit on the Supply Chain basis difference was recorded in the third quarter.

Cash on hand was $8 billion at Sept. 30, including about $2.7 billion of IEEPA tariff refunds held for customers. FedEx completed $2.0 billion of share repurchases in June through September, buying about 6.3 million shares; $4.3 billion remained under the 2026 authorization.

Parcel rates effective Jan. 4, 2027, will increase an average of 5.9%. Claude Russ, enterprise vice president and interim chief financial officer, said the higher 2026 outlook reflects focused execution and momentum toward 2029 financial targets.