The Wall Street Journalreports that FedEx plans to
cut $1 billion of costs in the coming year. The company's fiscal third-quarter net income plunged 75%. FedEx did not specificy exactly how it plans to cut costs but job cuts will be part of the $1 billion in cuts.
Meanwhile, FedEx posted net income for the quarter ended Feb. 28 of $97 million, or 31 cents a share, down from $393 million, or $1.26 a share, a year earlier. Revenue decreased 14% to $8.14 billion, hurt by reduced fuel surcharges and lower shipment weights.
Analysts expected earnings of 46 cents on revenue of $8.65 billion.
Operating margin at FedEx's express segment dropped to 0.9% from 6.9% as revenue fell 18% and average daily volume slid 5%. Daily volume at the ground segment rose 2% on continued growth in the FedEx Home Delivery service, as operating margin rose to 10.9% from 9.9%. The business was aided by last year's closing of competitor DHL.
Lower package volume during the recession is hurting Fedex. FedEx's revenues fell 14% in the company's third quarter.
The Wall Street Journal 
