FedEx Freight Revenue Down 4.7% to $1.99B, Spin-Off Set with $3.7B Debt
FedEx Freight’s revenue fell 4.7% y/y to $1.99B in the quarter to Feb.28, with tonnage down 4.8% and adjusted operating ratio at 93.3% after $126M in separation costs. LTL spin-off is scheduled for June 1 with a $3.7B debt offering; full-year revenue is projected to decline low-single digits.
1. FedEx Freight Quarterly Performance
FedEx Freight reported revenue of $1.99 billion for the quarter to Feb. 28, down 4.7% year-on-year as tonnage declined 4.8%. Yield per hundredweight rose 0.2%, but adjusted operating ratio reached 93.3% after $126 million in separation-related expenses.
2. LTL Spin-Off Details
The less-than-truckload unit will spin off on June 1 and list on the NYSE under ticker FDXF following a $3.7 billion debt offering completed in January. Incremental separation costs have weighed on results as the unit builds out a dedicated LTL sales team.
3. Outlook and Projections
Management projects full-year fiscal 2026 revenue for FedEx Freight to decline low-single digits, with Q4 volumes flat to down slightly as yield growth offsets mid-single-digit shipment declines. Full-year adjusted operating income is now expected to fall $400 million year-on-year.
4. FedEx Corp Consolidated Results
FedEx Corp. delivered consolidated revenue of $24 billion in the quarter, up 8% year-on-year, with adjusted EPS of $5.25 outperforming consensus. The adjusted EPS figure excluded $0.84 per share in spin-off and optimization costs.