FedEx issued lackluster guidance for its new fiscal year as the package-delivery giant said its also will spend more again this year to bulk up its ground operations to tackle higher volume from online shopping.
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Shares fell 1.5% to $161.50 after hours, although the company's adjusted per-share earnings and revenue beat expectations.
For the fiscal year ending in May of 2017, the Memphis, Tenn., company forecast adjusted per-share earnings of $11.75 to $12.25. Analysts polled by Thomson Reuters expected per-share profit of $12.05.
The company also said it is raising capital spending for the fiscal current year to $5.1 billion, up from $4.8 billion in the recently completed year.
For the period ended May 31, FedEx reported a loss of $70 million, or 26 cents a share, compared with a year-earlier loss of $895 million, or $3.16 a share. Excluding pension-accounting adjustments, TNT acquisition- and integration-related expenses and other items, adjusted per-share earnings rose to $3.30 from adjusted earnings of $2.66 a share. Revenue increased 7.4% to $13 billion.
Analysts polled by Thomson Reuters expected per-share profit of $3.28 and revenue of $12.78 billion.
Investors and analysts likely will be listening to FedEx's earnings call for any details about the integration of FedEx's nearly $5 billion acquisition of Dutch parcel firm TNT Express NV.