The update, from a company seen as a bellwether for global economic growth because of the wide range of items it ships, was issued after Wall Street’s closing bell on Thursday and had sent shares down more than 20 percent in early trading on Friday. morning at their lowest level in more than two years. The warning had an impact on the broader market, with S&P 500 futures falling about 1 percent in premarket trading. Shares of rival parcel and logistics companies also fell. FedEx posted preliminary results for the quarter to August 31 that were weaker than analysts expected, blaming “global volume softness” that “accelerated” in the final weeks of the quarter. The company, which was due to formally report on September 22, said it expected business conditions to weaken further in the second quarter, prompting it to cut its capital spending forecast and withdraw guidance for the rest of the financial year. “Global volumes declined as macroeconomic trends worsened significantly later in the quarter, both internationally and in the US,” said chief executive Raj Subramaniam, who took over the reins of the company in June from founder Fred Smith. “We are quickly addressing these headwinds, but given the speed with which conditions have changed, first-quarter results have fallen short of our expectations.” Subramaniam described the performance as “disappointing” and said the company was “aggressively accelerating” efforts to cut costs and boost productivity. In an effort to mitigate the effects of reduced demand, FedEx announced it will close more than 90 FedEx offices, postpone hiring, cancel some projects, reduce flights and temporarily park aircraft, among other things. In its preliminary results, FedEx reported first-quarter earnings of $3.33 a share, down 19% from a year ago and well below the $5.14 a share Wall Street was expecting. Revenue rose 5 percent from a year ago to $23.2 billion, but was slightly below analysts’ forecasts of $23.6 billion. The company said it expected business conditions to weaken further in the current quarter and forecast revenue of $23.5 billion to $24 billion, with earnings of $2.65 “or more” per share. Wall Street had expected revenue of $24.9 billion and earnings of $5.39 per share. FedEx also cut its forecast for capital spending in the fiscal year to $6.3 billion from $6.8 billion.
