FedEx reported its first-quarter fiscal year 2025 results, with consolidated revenue declining 1% year-over-year. The company narrowed its adjusted earnings per share (EPS) outlook range for the full fiscal year to $20 to $21, reflecting a weaker-than-expected demand environment, particularly in the U.S. domestic package market. This adjustment was influenced by a mix shift towards lower-yielding deferred services and one fewer operating day in the quarter.
Despite the challenging demand, FedEx achieved $390 million in DRIVE-related structural cost savings during the quarter, with contributions from surface, air network & international, and general & administrative functions. The company remains on track to deliver $4 billion in total DRIVE savings by the end of FY25. Network 2.0 rollout continued, with Canada's integration expected to be largely complete by early calendar year 2025, showing approximately a 10% reduction in pickup and delivery costs in fully rolled-out markets.
Further strategic developments included a strategic alliance investment with Nimble, an AI robotics company, to enhance e-commerce fulfillment. The company also prepared for the expiration of its U.S. Postal Service contract at the end of September 2024. Additionally, Gina Adams was appointed as the new General Counsel and Secretary of FedEx, effective September 24, bringing extensive experience in government and regulatory affairs.
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