In the fiscal fourth quarter, the company adjusted its network to match shifting demand, cutting Asia-to-America lane capacity by more than 35 percent in May.
FedEx reported another quarter of lackluster sales, as volume from China to the United States fell sharply after President Donald Trump announced reciprocal tariffs on April 2, and remained weak throughout the fourth quarter of fiscal 2025.
After the market closed on June 24, the Memphis, Tennessee-based provider of transportation, e-commerce, and business services in the United States and internationally reported revenue of $22.2 billion for the fourth quarter, which ended May 31, roughly unchanged from a year ago.
Diluted earnings per share were $6.88, and adjusted diluted earnings per share were $6.07, up from $5.94 and $5.41, respectively, a year earlier.
However, the company lowered its earnings guidance for the first quarter of fiscal 2026 to a range of $3.40–4.00, down from the previously forecasted $4.03, after excluding costs related to business optimization initiatives and the planned spin-off of FedEx Freight.
FedEx chief financial officer John Dietrich said during the earnings call that the company’s outlook was primarily based on the current tariff rates. He noted that the tariffs could reduce international export revenue—mainly from China—by $170 million in the first quarter of fiscal 2026.
Dietrich said that shipments from China to the United States account for approximately 2.5 percent of the company’s consolidated revenue and represent its most profitable intercontinental business.
“Due to escalating trade barriers in the quarter, we experienced a material headwind on our Asia to U. S. lane, largely driven by China,” he said.
Chief customer officer Brie Carere said domestic shipping volumes remained strong throughout the quarter, with growth accelerating in late April and May. However, shipments from China “deteriorated sharply” after Trump announced reciprocal tariffs on April 2 and remained weak for the rest of the fiscal fourth quarter.
“What we do anticipate is that from a year-over-year perspective, we will have pressure in the Transpacific lane,” Carere said.
“When we talked about the headwind on tariffs, the vast majority of that is [the] impact from China [on] the US. And within that, the vast majority is the impact of de minimis.”
