FedEx Posts Upbeat Q3 Earnings, But Issues Weak Guidance

FedEx Corp. (NYSE: FDX) reported stronger-than-expected earnings for the third quarter ended February 28. However, the company issued a weak earnings outlook for the full year.The Memphis, Tennessee-based company posted quarterly net income of $580 million, or $2.01 per share, compared to $378 million, or $1.23 per share, in the year-ago period.Its revenue rose 4% y/y to $11.7 billion, compared to $11.3 billion. However, analysts were expecting earnings of $1.87 per share on revenue of $11.79 billion.Revenue from the FedEx Express segment slipped to $6.66 billion in the third quarter, versus $6.67 billion in the year-ago quarter. Revenue from the FedEx Ground segment rose 12% to $3.39 billion from $3.03 billion, while the FedEx Freight segment revenue gained 6% to $1.43 billion from $1.35 billion.Operating income climbed 50% y/y to $962 million from $641 million, while operating margin widened to 8.2% from 5.7%."We had a very successful peak season as volumes grew across all transportation segments, and our profit improvement programs are moving ahead as scheduled," said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer.For fiscal 2015, FedEx expects earnings of $8.80 to $8.95 per share, versus analysts' estimates of $8.97 per share.FedEx shares rose 0.13% to $175.94 in pre-market trading.