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FedEx said it expects cost savings between $2.2 billion and 2.7 billion in fiscal 2023, amid weaking demand due to a weaker-than-expected business environment.
The cost savings will come from reducing flight frequencies at FedEx Express, suspending certain operations at FedEx Ground, among other measures, the company said.
The company had preannounced results for the first-quarter a week ago and pulled its forecast for the full year, citing a rapid deterioration in the global economy. It is now moving to cut capacity and costs that are eroding profits.
“We’re moving with speed and agility to navigate a difficult operating environment, pulling cost, commercial, and capacity levers to adjust to the impacts of reduced demand,” said Raj Subramaniam, FedEx’s chief executive.
The company’s quarterly net profit fell to $875 million, or $3.33 per share, from $1.11 billion, or $4.09 per share, a year earlier.
