FedEx warns of ‘continued weakness and uncertainty’ in the US industrial economy

• FedEx revised its outlook downward, citing “weakness and uncertainty” in the US industrial economy.
• The shipping giant said its freight and business-to-business demand were soft in the third quarter.
• Shares of FedEx stock fell roughly 5% in after-hours trading.

FedEx is flashing a yellow light on the economy.

The company on Thursday revised its financial outlook downward, citing “continued weakness and uncertainty” in the US industrial sector.

CEO Raj Subramaniam said in a third-quarter earnings call that freight and business-to-business demand were less soft in the period than in the one prior, but not by enough to support the company’s December guidance.

“I think it’s reasonable to assume that the macro environment is not going to significantly improve, at least for the first half of 2026,” CFO John Dietrich added.

Shares of FedEx stock fell roughly 5% in after-hours trading.

The company highlighted several cost cutting and efficiency initiatives it said would help to counter the economic headwinds, as well as the reduction in revenue from the end of a contract the carrier had with the US Postal Service.

With respect to tariffs, chief customer officer Brie Carere said customers have mostly not elected to ship goods early to get ahead of new import charges.

“We did see a little volatility in APAC, kind of at the end of February, early March, but for the most part, a pull forward is really hard,” she said. “I’ve actually only met one customer who attempted it, and they regretted it because they ended up storing some excess inventory.”

In addition, Carere hinted that higher prices are likely on the way once again: “We are talking to a lot of customers who are anticipating that they will increase prices or already have.”