LOS ANGELES (Reuters) -FedEx Corp said on Wednesday the delivery firm will consolidate its operating companies into one organization, as part of its plan to slash $4 billion in permanent costs by the end of fiscal 2025.
Shares of the freight bellwether firm were up 2.9% before the bell.
Executives at the Memphis, Tennessee-based package delivery company said last month they were on track to hit $1 billion in permanent cost cuts this fiscal year ending May 31 – putting FedEx well on its way toward its 2025 goal.
The company, which competes with direct rival United Parcel Service and Amazon.com’s growing delivery operation, is racing to reduce overhead that has pressured profits as demand for deliveries cools and global recession threatens.
The phased transition announced Wednesday will ultimately bring FedEx Express, FedEx Ground, FedEx Services and other FedEx operating companies into Federal Express Corporation and will be headed by present Chief Executive Officer Raj Subramaniam, the company said.
(Reporting by Lisa Baertlein in Los Angeles and Kannaki Deka in Bengaluru; Editing by Himani Sarkar and Krishna Chandra Eluri)
