Profit Will Miss Estimates, FedEx Says

FedEx Corp. said it expects fiscal first-quarter profit to fall short of Wall Street estimates, hurt by a slow recovery in the technology and manufacturing sectors, key drivers of air shipments.

FedEx shares dropped 14% despite the company’s report of better-than-expected profit for the latest quarter. FedEx fell $8.02, to $48, in active Big Board trading.

FedEx, whose FedEx Express unit is the world’s largest express transport company, said earnings for the current quarter ending Aug. 31 should come in at 40 cents to 50 cents a share, below the mean estimate of 54 cents from eight analysts surveyed by Thomson First Call.

Profit more than doubled to $236 million, or 78 cents a share, in the fiscal fourth quarter ended May 31, from $113 million, or 38 cents, a year earlier, as revenue grew 6% to $5.42 billion.

The results were a penny better than analysts’ average estimate.