FedEx profit falls 17 percent, hurt by TNT cyberattack
FedEx said Tuesday that its first-quarter profit fell 17 percent, hurt by a June cyberattack at its TNT Express business that caused shipping delays in Europe. It also cut its profit outlook for the year and its shares fell in after-hours trading.
The package delivery company said that most of TNT's operations are up and running but profit, revenue and package volume are still down from previous levels. FedEx bought TNT last year to expand its business in Europe.
Looking ahead to the busy holiday season, FedEx said Tuesday that it plans to hire 50,000 people to help deliver packages, the same number it hired last year. The company announced last month that it would not be charging customers an extra holiday shipping fee like it did last year.
Overall, FedEx reported net income of $596 million, or $2.19 per share, in the three months ending Aug. 31. That's down from $715 million, or $2.65 per share, in the same period a year ago.
Earnings, adjusted for non-recurring costs, came to $2.51 per share, falling short of the $3.17 per share Wall Street analysts expected, according to Zacks Investment Research.
The Memphis, Tennessee-based company said revenue rose 4 percent to $15.3 billion, which was below the $15.37 billion analysts expected.
FedEx now expects full-year earnings in the range of $12 per share to $12.80 per share, down from its previous forecast between $13.20 per share and $14 per share.
Shares of Fedex Corp., which are up about 16 percent so far this year, fell 1.7 percent to $212.40 in after-hours trading Tuesday.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on FDX at https://www.zacks.com/ap/FDX
Keywords: FedEx, Earnings Report