FedEx is prioritizing the development of high-margin business segments and has issued higher annual revenue guidance for fiscal year 2029.
The parcel delivery giant stated on Thursday that its revenue target for fiscal 2029 is $98 billion. Excluding its freight business, this represents a compound annual growth rate of 4% from the midpoint of the current fiscal year's forecast.
For fiscal 2026, FedEx's revenue guidance is approximately $93.5 billion, or $85 billion excluding freight. The company reported revenue of $87.9 billion for fiscal 2025, which ended last May.
Looking ahead, FedEx will prioritize high-margin operations, with plans to focus on premium corporate clients and specialized consumer segments. The company indicated that target industries include healthcare, automotive, aerospace, data centers, and high-value e-commerce.
The company also plans to expand its capabilities in digitalization, artificial intelligence, and automation.
"The unique aspect now is the role of digital intelligence; it is a true force multiplier," stated the company's Chief Executive Officer, noting that digital intelligence will support profitable growth and higher margins.
FedEx also stated that it now anticipates its adjusted earnings per share for the third fiscal quarter will exceed the consensus market expectation as of February 11. Analysts surveyed by FactSet expect adjusted earnings per share of $4.01 for the quarter.
Following the completion of the freight business separation, FedEx will adopt a new, adjusted reporting structure. Through targeted strategies, the company aims to achieve improved operating margins and revenue growth by fiscal 2029.
The company expects its U.S. Domestic segment to achieve growth in both operating income and revenue, driven by disciplined pricing and increased volume from enterprise and premium consumer customers. Meanwhile, improved performance in European operations and growth in premium cross-border and intercontinental routes are expected to benefit the International segment.