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FedEx Corp. shares dropped in the extended session Tuesday after the shipper’s earnings and outlook fell short of Wall Street estimates.
FedEx FDX, -0.53% shares fell 6.4% after hours, following a 0.5% decline in the regular session to close at $163.23. At the close, FedEx shares were up 1.2% for the year, compared with a 27% gain by the S&P 500 index SPX, +0.03% .
The company reported fiscal second-quarter net income of $560 million, or $2.13 a share, compared with $935 million, or $3.51 a share, in the year-ago period. Adjusted earnings were $2.51 a share.
Revenue declined to $17.3 billion from $17.8 billion in the year-ago quarter.
Analysts surveyed by FactSet had forecast earnings of $2.78 a share on revenue of $17.6 billion.
“Fiscal 2020 is a year of continued significant challenges and changes for FedEx, particularly in the quarter just ended due to the compressed shipping season,” said Frederick Smith, FedEx chairman and chief executive, in a statement.
FedEx said it now forecasts fiscal 2020 earnings of $9.10 to $10.35 a share, or $10.25 to $11.50 a share excluding expenses and aircraft impairment charges connected with the company’s 2016 acquisition of TNT Express. Neither estimates include year-end mark-to-market retirement plan accounting adjustments.
Analysts had forecast earnings of $12.09 a share, based on FedEx’s previous estimate of $11 to $13 a share.
“Our revised guidance reflects lower-than-expected revenue at each of our transportation segments and higher-than-expected expenses driven by continued mix shift to residential delivery services,” said Alan Graf, FedEx’s chief financial officer, in a statement.
