By Lisa Baertlein and Kannaki Deka
(Reuters) -FedEx Corp on Thursday raised its fiscal 2023 profit forecast, citing progress on its plan to shave $3.7 billion in costs from the global delivery firm’s operations.
Shares jumped 9.2% to $222.75 in extended trading after executives boosted their fiscal 2023 adjust profit forecast to $13.80 to $14.40 per share. In December, their forecast called for profits of $12.50 to $13.50 per share.
“Our cost actions are taking hold, driving an improved outlook for the current fiscal year,” CEO Raj Subramaniam said in a statement.
Subramaniam has the difficult job of cutting costs and capacity to match waning demand in an economy threatened by threatened by the ongoing war in Ukraine, bank failures and growing recession concerns.
The Memphis, Tennessee-based company is wringing out costs by shuttering offices, cutting staff, grounding airplanes, canceling profit-sapping Sunday deliveries in far-flung areas and furloughing workers in its freight division.
FedEx reported better-than-expected adjusted income of $865 million, or $3.41 per share, for the third-quarter ended Feb. 28. That’s down from $1.22 billion, or $4.59 per share, a year earlier.
Revenue fell to $22.2 billion from $23.6 billion, after it delivered fewer packages than during the year-earlier period.
(Reporting by Lisa Baertlein in Los Angeles and Kannaki Deka in Bengaluru;)
