FedEx stock soars as new initiatives pay off - ShipRx
Blog / FedEx stock soars as new initiatives pay off
2 minutes read

FedEx stock soars as new initiatives pay off

If you hold FedEx stock, your wallet may feel a little heavier today. Less than a year after FedEx’s most significant single-day stock drop, the carrier’s stock is officially out of the buy zone. While investors celebrated a dividend hike, the company announced a new corporate structure. In today’s blog post, we’ll talk about FedEx’s major comeback, the new operation strategy, and what it means for your business.

How FedEx went from big losses to a major win

In September 2022, FedEx released its end-of-quarter earnings report, revealing lower-than-expected revenue. Investors were swift to act, and in a single day, its stock dropped 21%.

In the following months, the carrier revealed several cost-cutting efforts (including a reduction in flights, salary cuts, and ending Sunday deliveries in some locations) and a dynamic pricing infrastructure that resulted in a swift turnaround despite a drop in e-commerce sales.

Just last month, FedEx beat Wall Street estimates of per-share earnings of $2.71 from sales of $22.7 billion when it reported $22.2 billion in sales, resulting in earnings of $3.41 per share. The company showed confidence in a continued upward trend by announcing that it would increase its annual payout to shareholders by 44 cents for a quarterly dividend of $1.26 a share.

Big news for FedEx Express, Ground, and Services

Just a few months ago, FedEx reported that its Ground revenue fell approximately $300 million below its projections for the first quarter. Since then, the carrier has been busy identifying failures in the system and crafting a new plan for success. After announcing its dividend increase, FedEx reported that it would consolidate its Express, Ground, and Services to drive efficiencies. This is just one move in the shipping giant’s DRIVE strategy to cut $4 billion in cost by the fiscal year 2025.

In the past, a Ground driver and an Express driver might have made stops at the same home or business on the same day. With all delivery networks under one umbrella, the company aims to reduce repetitive visits, saving labor and fuel costs. For clients using FedEx’s less-than-truckload service, nothing will change. The LTL network will remain separate, as the freight typically travels shorter distances, and the business primarily serves industrial clients.

Will FedEx’s consolidation affect your shipping strategy?

Addressing the organizational change, FedEx CEO Raj Subramaniam stated, “This organizational evolution reflects how we represent ourselves in the marketplace—focused on flexibility, efficiency, and intelligence.” If anything, the new corporate structure should reduce redundancies and streamline shipping. The elimination of multiple drivers on the same route will certainly save FedEx money. Will it save you money, too?

If you’re paying too much for shipping, ShipRx can help. Through parcel audits and parcel rate negotiations, we help our customers spend less on every shipment and maximize the refunds they’re owed. It’s free to get started, so get in touch today and make sure FedEx isn’t the only one saving money with this new strategy.

James Founding Partner
2 Minute Read

Amazon officially eclipses UPS and FedEx delivery volume

In the minds of most Americans, Amazon is the online retailer that can fulfill any order— usually in just a day or two. They think about the product, not the delivery process. While the country was busy shopping, Amazon
Todd Partner
2 Minute Read

Freight downturn: bad for carriers, but good for shippers?

Nintendo Game Boy. Butterfinger BBs. The Ford Thunderbird. The pandemic-era freight boom. Nothing lasts forever. The shipping industry is seeing too many trucks and too little freight, resulting in a severe freight recession. It’s a problem for the carriers,
James Founding Partner
2 Minute Read

USPS 2024 rate hikes mirroring those by FedEx and UPS

Postmaster General and USPS CEO Louis DeJoy shocked the shipping industry with his September announcement: “We have been planning early and leveraging investments in our people, infrastructure, transportation and technology made possible by the Delivering for America plan. And
Brittany ShipRx Contributor

Save On Your Parcel Costs Today

Get a full-scale analysis of your business and ShipRX exclusive recommended solutions to increase your profits.

Cost Saving Services

Request Your Free Savings Report.

Fill out the form below, and we’ll call you within 24 hours. In a rush? Call now (844) 774-4779

Pop Up Form

  • This field is for validation purposes and should be left unchanged.