THE board of fedex has agreed to separate FedEx and FedEx Freight into two public companies with the reasoning that 'separation unlocks significant value'.
FedEx Corporation confirmed the decision in its fiscal second quarter 2025 (September 1- November 31, 2024) earnings presentation, released on December 19.
The aim is to grow FedEx Freight's position in the less than truckload (LTL) market, reports London's Air Cargo News.
The company said: 'FedEx and FedEx Freight will benefit from enhanced focus and competitiveness.' However, it added that it planned to 'continue to enable commercial, operational and technological cooperation'.
Rajesh Subramaniam, FedEx president, chief executive and director, said in the Q2 earnings call that 'we expect to execute the separation within approximately 18 months'.
Revenue for FedEx Express in the second quarter of the financial year 2024 was flat at US$18.8bn.
However, operating income was up 13 per cent for the segment, driven by DRIVE structural cost savings, base yield improvement, and increased international export demand.
FedEx's decision to separate FedEx Freight from the rest of its operations clearly comes at a challenging time for the business.
FedEx Freight suffered an 11 per cent revenue drop to $2.2 billion.
FedEx noted that the 'decrease (was) driven by lower average daily shipments, fuel surcharges, and weight per shipment. YoY revenue comparison (was) challenged by last year's yellow volume acquisition.'
Brie Carere, executive vice president, chief customer officer, said: 'Higher yields across our services were partially offset by volumes, which declined year over year.'
She further noted: 'International export package volumes increased 9 per cent in the quarter, driven by international economy, which is largely consistent with recent quarterly trends.'
One of FedEx's goals for next year is to increase its global airfreight market share, noted Miss Carere.
SeaNews Turkey
FedEx Corporation confirmed the decision in its fiscal second quarter 2025 (September 1- November 31, 2024) earnings presentation, released on December 19.
The aim is to grow FedEx Freight's position in the less than truckload (LTL) market, reports London's Air Cargo News.
The company said: 'FedEx and FedEx Freight will benefit from enhanced focus and competitiveness.' However, it added that it planned to 'continue to enable commercial, operational and technological cooperation'.
Rajesh Subramaniam, FedEx president, chief executive and director, said in the Q2 earnings call that 'we expect to execute the separation within approximately 18 months'.
Revenue for FedEx Express in the second quarter of the financial year 2024 was flat at US$18.8bn.
However, operating income was up 13 per cent for the segment, driven by DRIVE structural cost savings, base yield improvement, and increased international export demand.
FedEx's decision to separate FedEx Freight from the rest of its operations clearly comes at a challenging time for the business.
FedEx Freight suffered an 11 per cent revenue drop to $2.2 billion.
FedEx noted that the 'decrease (was) driven by lower average daily shipments, fuel surcharges, and weight per shipment. YoY revenue comparison (was) challenged by last year's yellow volume acquisition.'
Brie Carere, executive vice president, chief customer officer, said: 'Higher yields across our services were partially offset by volumes, which declined year over year.'
She further noted: 'International export package volumes increased 9 per cent in the quarter, driven by international economy, which is largely consistent with recent quarterly trends.'
One of FedEx's goals for next year is to increase its global airfreight market share, noted Miss Carere.
SeaNews Turkey
