FedEx CEO: 'Trade is a two-way street'
FedEx CEO Fred Smith said the company is concerned about growing tensions between the U.S. and its trade partners.
“Trade is a two-way street, and FedEx supports lowering trade barriers for our customers, not raising them,” he said during the global shipping giant’s fourth-quarter earnings conference call.
Last week, FedEx issued a statement saying tariffs on Chinese imports are “counterproductive to U.S. economic interests.”
This is not the first time Smith has sounded the alarm on President Trump’s trade jabs. In March, he said he was “concerned” about recently-enacted tariffs on steel and aluminum and warned the initiative could offset the benefits of tax reform, as reported by FOX Business.
Shares of FedEx posted their worst day in two months Tuesday, responding to President Donald Trump’s threat to impose new tariffs on $200 billion in Chinese goods. FedEx and its rival, United Parcel Service, each fell about 2%.
But FedEx rebounded slightly in after-hours trading after reporting quarterly earnings and revenue that beat expectations, due in part to higher shipping rates and tax benefits.
FedEx also said its global supply chains are well-established and would be difficult to disrupt in a trade war.
The Memphis, Tennessee-based company’s fourth-quarter net income climbed about 11% to $1.13 billion, or $4.15 a share. Excluding one-time items, adjusted earnings per share hit $5.91, beating the consensus estimate of $5.71.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| FDX | FEDEX CORP. | 296.75 | -5.99 | -1.98% |
| UPS | UNITED PARCEL SERVICE INC. | 134.02 | -1.70 | -1.25% |
Revenue jumped 10% to $17.3 billion, beating Wall Street’s projection of $17.25 billion.
FedEx expects to report revenue growth of 9% in fiscal 2019. The company also provided guidance for full-year earnings of $17 to $17.60 per share. Analysts were looking for $17.47 per share.