FedEx shares rose by 5.7% to $264.60 during extended trading on Wednesday after the company achieved a major quarterly profit estimate beat. The company reported a 32% rise in first-quarter adjusted earnings to $4.55 per share, thereby beating Wall Street estimates by 82 cents according to the LSEG data.
In addition to a major cost-cutting campaign, FedEx also boosted its profit by snatching customers from rivals such as UPS and Yellow. After the contract covering UPS’s unionized workforce ended on August 1, FedEx was able to pick up around 400,000 more packages per day. The FedEx unit that delivers packages to retailers like Walmart saw a 59% rise in profit for the quarter ended August 31.
After Yellow ceased operations in July, FedEx’s less-than-truckload transportation sector business also picked up. FedEx saw an increase in average daily shipments of over 5,000 packages. While the company did not provide a specific figure, FedEx declared that it is “well-positioned” for the upcoming holiday season.