Key Highlights

  • Revenue rose 12% to USD 22.9 billion in the three months to September 30, 2026, helped by fuel surcharges.
  • Adjusted earnings per share reached USD 3.74, up 28% year over year, versus GAAP diluted EPS of USD 1.21.
  • Adjusted operating income grew 16%, led by Express International up 52% and Express U.S. Domestic up 7%.
  • Calendar 2026 adjusted EPS guidance rose to USD 18.00 to USD 18.60, with free cash flow near USD 4 billion.

FedEx Corporation (NYSE:FDX) reported calendar third-quarter 2026 revenue of USD 22.9 billion, up from USD 20.4 billion a year earlier and above a consensus estimate of USD 22.73 billion. Adjusted earnings per share of USD 3.74 topped a consensus estimate of USD 3.34. This was the first earnings call to follow the company's switch to calendar-year reporting, so the period covers July through September.

On a GAAP basis, operating income was USD 1.07 billion versus USD 972 million, while income from continuing operations fell to USD 290 million from USD 645 million. Diluted earnings per share from continuing operations were USD 1.21, compared with USD 2.73 a year earlier. The GAAP result includes a USD 1.24 billion loss on a short-term investment, partly offset by USD 661 million of other non-operating income.

Segment Trends and Capital Returns

Chief executive officer Rajesh Subramaniam said B2B verticals and premium B2C drove growth. Consolidated adjusted operating income rose USD 164 million, or 16%, despite a USD 100 million headwind from the new pilot agreement and USD 75 million from variable incentive compensation. Express U.S. Domestic revenue grew 10% and adjusted operating income 7%, while adjusted margin slipped 20 basis points. Express International revenue grew 17% and adjusted operating income 52%, with 80 basis points of margin expansion. U.S. Domestic package yield rose 7% and international package yield rose 17%.

Since June, the company repurchased USD 2 billion of its stock and holds USD 4.3 billion of remaining authorization. It declared a dividend of USD 1.22 per share for the quarter. Management also pointed to the June 1 spin-off of FedEx Freight, the sale of FedEx Supply Chain to CMA CGM Group, and an InPost transaction nearing completion.

Calendar 2026 Guidance and Cost Pressures

The company raised its calendar 2026 adjusted EPS range to USD 18.00 to USD 18.60, implying about 23% growth at the midpoint. It projects revenue growth near 12%, including roughly 4 percentage points from fuel surcharges, a tax rate near 22.5%, capital spending of USD 3.9 billion and adjusted free cash flow of about USD 4 billion. The embedded fourth-quarter adjusted EPS range is USD 6.30 to USD 6.63, with revenue growth near 10%.

Management flagged transitory fourth-quarter pressures: USD 130 million from higher over-the-road line-haul rates, USD 100 million tied to the pilot agreement and USD 80 million of aircraft maintenance expense. U.S. Domestic adjusted operating margin is projected to decline moderately in the fourth quarter, while International margin is projected to expand.

Figures That Frame the Next Report

Several dated items frame the next report. The fourth-quarter adjusted EPS range of USD 6.30 to USD 6.63 is the first benchmark. The second is the incoming chief financial officer, who starts November 30, following an interim period of about five months. The third is the 19.9% retained stake in FedEx Freight, which must be monetized within 24 months of the spin date. The fourth is pricing, with a general rate increase of 5.9% effective January 4. The fifth is Network 2.0 savings, which management put near USD 1 billion by the end of calendar 2026 and USD 2 billion cumulative by the end of 2027.