FedEx Drops 5.67% on Cautious Outlook Despite Strong Q1

On June 25, 2025, FedEx's stock price experienced a significant drop of 5.67% in pre-market trading, reflecting investor concerns and market reactions to recent developments.

FedEx's stock price decline was primarily driven by the company's cautious outlook for the year ahead. The global demand environment remains volatile, and the company's profit outlook highlighted tariff challenges and macroeconomic headwinds. This cautious stance led to a significant drop in investor confidence, despite the company's strong Q1 earnings report.

FedEx reported $22.2 billion in revenue and adjusted EPS of $6.07 for the fiscal Q1 2025, surpassing Wall Street expectations. However, the company withheld full-year EPS guidance for fiscal 2026, raising concerns about future growth and investor confidence. The absence of a firm forecast suggests that macroeconomic headwinds and softening global trade demand may persist well into FY26.

Despite successful cost-cutting measures and significant shareholder returns, FedEx is perceived more as a defensive stock rather than a growth-oriented leader. The company's DRIVE cost-cutting program achieved $2.2 billion in structural cost reductions in FY2025 and plans to cut an additional $1 billion by FY2026. However, concerns persist about slowing e-commerce, weak corporate shipping demand, and global trade tensions, weighing on FedEx’s growth outlook.