FedEx Freight Sees Volumes Stabilizing, Guides Q4 Revenue Up 13% After Spinoff

FedEx Freight (NYSE: FDXF) said Thursday its volumes have continued to stabilize and it expects stronger operating leverage as a standalone carrier, projecting fourth-quarter revenue of $2.3 billion to $2.37 billion — a 13% year-over-year increase at the midpoint, driven primarily by higher diesel fuel surcharges. Shares rose 3% in after-hours trading. For the four months from June through September, its first reporting period since completing its spinoff from FedEx (NYSE: FDX) in June, revenue rose 9% year over year to $3.28 billion. Revenue per day climbed 8% on a 9% increase in revenue per hundredweight, while tonnage was flat. Adjusted earnings per share fell 70 cents year over year to $2.15. The company guided fourth-quarter adjusted operating income up 20% year over year at the midpoint, to $185 million to $205 million, implying an adjusted operating ratio of 91.4% to 92%. Its 2027 general rate increase, averaging 6.9%, takes effect Jan. 8. FedEx Freight said it will soon decide on a dividend and share buybacks, with repurchases likely used to offset dilution as FedEx unwinds its equity stake.