FedEx Corporation issued its financial forecast for fiscal year 2027, projecting revenue and adjusted earnings per share below analyst expectations following the completion of its FedEx Freight spinoff. The company forecasts revenue of $97.569 billion for the year, compared to the analyst estimate of $96.005 billion. Adjusted diluted EPS is expected to be in the range of $16.90 to $18.10, significantly lower than the $21.61 analyst estimate. The company also sees revenue growth of approximately 11% year-over-year.

FY2027 Financial Outlook

The guidance for fiscal 2027 reflects the transition year following the fiscal year change and the separation of the FedEx Freight unit. The effective tax rate is forecast to be approximately 23%, while capital spending is projected to be $3.9 billion.

Recent Performance and Strategic Actions

In the prior fiscal year ended May 31, FedEx reported revenue of $94.7 billion, an increase from $87.9 billion in fiscal 2025. The company exceeded its goal of $1 billion of transformation-related cost savings during the fiscal year. The spinoff of FedEx Freight into a new publicly traded company was finalized on June 1, 2026, with FedEx Freight paying a cash dividend of approximately $4.1 billion to FedEx Corporation.

FedEx returned approximately $2.2 billion to stockholders during fiscal 2026 through $776 million of stock repurchases and $1.4 billion of dividend payments. The company announced it remains committed to returning capital to stockholders in calendar 2026, including a previously announced 5% increase in the annual dividend and plans to repurchase up to $1 billion worth of shares.

FedEx Corp. today announced plans to repurchase up to $1 billion worth of shares opportunistically, leveraging continued balance sheet flexibility and free cash flow generation to offset dilution from equity compensation. The company reaffirmed its commitment to returning capital to stockholders, which includes a previously announced 5% increase in the annual dividend on its common stock, adjusted for the FedEx Freight spin-off.

Capital Allocation Strategy

The repurchase program is designed to manage dilution resulting from equity compensation while maintaining financial flexibility. FedEx intends to execute these buybacks opportunistically, aligning with its free cash flow generation capabilities.

Dividend Increase Details

As part of its capital return strategy, FedEx has implemented a 5% increase in the annual dividend on its common stock. This adjustment accounts for the impact of the FedEx Freight spin-off, ensuring consistency in shareholder returns.