Fed-Ex in Some Uncertain Territory

Fed-Ex (NYSE-FDX) withdrew its first quarter fiscal 2023 earnings forecast and posted a preliminary earnings report that did not look promising.

The company has recently released a list of planned “cost reduction actions.” According to Commercial Appeal, these include “reducing flight frequency, reducing labor and operating hours, deferring staff hiring and closing more than 90 FedEx Office locations.” 

Directly after the company made this announcement, Fed-Ex stock plummeted.

However, as of now, Shares of Fed-Ex are getting boosted. This does not mean Fed-Ex is in the clear, and it also does not mean there will not be any skeptics. For example, one user wrote on a Yahoo Finance article explaining the rise in stock price, “The stock may rise but I no longer use fed-ex as they have become unreliable….”

In the past, Fed-Ex has handled some issues including the effects of inflation with “revenue management actions, such as increasing fuel surcharges.” But when it comes to customer satisfaction, that seems to be lacking. 

Increased operating and labor costs along with plunging demand has put Fed-Ex in some uncertain territory.