FedEx (FDX) shares jumped in late trading Tuesday after the company reported a modest improvement in quarterly revenue, reversing six straight quarters of declines.
The shipping giant said it still faces a challenging market for parcel deliveries but added that it benefitted from savings due to restructuring efforts that include multiple rounds of workforce reductions and facility closures. Earlier this month, FedEx said it is reducing its headcount in Europe by as many as 2,000 people.
Shares rose 14.05% to $292.4 in post-market trading.
— The Memphis, Tenn.-based company said revenue rose to $22.1 billion in the quarter, from $21.93 billion a year earlier, slightly exceeding the $22.04 billion expected by analysts polled by FactSet. For the fiscal year, revenue reached $87.7 billion, down from the $90.2 billion a year earlier.
— The company said it logged $157 million in charges linked to a decision to retire 22 aircraft and seven related engines. FedEx is reducing its air fleet to better match capacity with demand.
— For the current fiscal year, FedEx said it expects a low to mid-single digit revenue growth.
The company has been working on a restructuring plan that includes combining its Ground and Express units, which it has said will take several years. FedEx added that it is also assessing options for one of its smaller business units, FedEx Freight.
FedEx no longer faces tough comparisons to the pandemic-related e-commerce boom, but continues to confront sluggish parcel volumes. In April, the U.S. Postal Service said it tapped United Parcel Service to replace FedEx for domestic air transportation. FedEx has said it plans to eliminate costs it had in place to support the Postal Service contract after it ends.