FedEx Cuts Forecast, Blaming Labor Shortages for Rising Costs
- Company shares decline 5% in late trading on Tuesday
- FedEx trims profit outlook while keeping capex spending steady
A customer exits a FedEx ship center in San Francisco, California. FedEx earnings missed estimates and the company cut its annual forecast.
Photographer: David Paul Morris/BloombergThis article is for subscribers only.
FedEx Corp. cut its outlook for annual profit after missing analysts’ quarterly earnings estimates because of higher costs and stalled growth in shipments. The shares fell as much as 5% after regular hours.
The company said a tight labor market was a key drag on fiscal first-quarter profit, as a dearth of workers drove up wages, reduced network efficiencies and increased the need to hire outside transportation services. Executives estimate this resulted in $450 million in added costs from a year earlier.