FedEx Revenue Up 12% to $22.9bn as International Freight Jumps 28%

FedEx posted revenue of $22.9 billion for the third quarter of calendar 2026, up roughly 12% from $20.4 billion a year earlier, driven by higher package yields, growing freight volumes and sustained cost reductions.

Operating income climbed to $1.07 billion from $972 million in the same quarter of 2025. Yet reported net income from continuing operations fell sharply to $290 million from $645 million, largely because of a non-cash loss tied to FedEx's retained 19.9% stake in the newly separated FedEx Freight business.

The underlying picture looked stronger once that write-down was stripped out. Adjusted net income from continuing operations rose to $896 million from $693 million, while adjusted diluted earnings per share reached $3.74 against $2.93 a year earlier — a gain of nearly 28% for shareholders on a comparable basis.

Where the growth came from

International operations did the heaviest lifting. The Express International segment generated $7.47 billion in revenue, up 17% year over year, and international freight revenue surged 28% to $1.44 billion on the back of heavier shipments and improved yields. Average daily international freight weight rose 15%.

The segment's operating income grew 15% to $220 million, showing that volume growth translated into profit rather than being bought with cheap pricing. For freight forwarders and shippers moving heavyweight international consignments, the numbers signal a carrier successfully defending yield in a segment where capacity discipline has mattered.

US domestic operations kept pace. Express US Domestic revenue rose 10% to $14.71 billion, supported by both higher package volumes and higher yields.

Portfolio reshaping continues

FedEx kept pushing its simplification strategy through the quarter. On 1 October 2026 it completed the sale of FedEx Supply Chain to CMA CGM Group for approximately $1.4 billion, a move designed to concentrate the company on core transportation operations. The deal hands CMA CGM a larger foothold in contract logistics while freeing FedEx capital and management attention.

The disposal followed the separation of FedEx Freight on 1 June 2026, after which FedEx retained a 19.9% ownership interest in the independent LTL business. That retained stake produced the quarter's non-cash loss, which explains the divergence between reported and adjusted profitability.

Cost pressure did not disappear. Higher transportation costs, rising wages and shifting global trade policies all weighed on operating expenses during the quarter, even as network optimisation programmes delivered savings.

What management said and what comes next

President and CEO Raj Subramaniam said: "Our strong operating results and adjusted free cash flow demonstrate that FedEx is winning across high-value market segments while we optimize our network."

The company backed that confidence with numbers. FedEx raised its calendar 2026 revenue growth forecast to approximately 12%, up from its previous estimate of 11%. It also lifted its adjusted diluted earnings per share outlook to a range of $18.00 to $18.60, from the prior $16.90 to $18.10.

Shareholders saw direct returns as well. FedEx bought back $2 billion of its own stock during the June–September period, underlining the balance-sheet room created by asset sales and improving cash generation.

For shippers, the raised outlook implies FedEx intends to keep defending yield while trimming network cost — a combination that typically favours service reliability over aggressive rate competition in the quarters ahead.