FedEx lowers outlook for the year amid tight labor market, rising expenses

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FedEx cites labor crunch and rising costs in reducing full-year forecast

FedEx Corp. shares fell more than 3% in extended trading Tuesday after the shipping and logistics company lowered its outlook for the year, saying that the cost of doing business rose more than it expected thanks to supply-chain disruptions and a tight labor market.

“The execution of our strategies continues to drive higher demand for our services, despite the disruptive impact of the pandemic to labor availability and global supply chains,” Chief Executive Frederick W. Smith said in a statement. FedEx has been in the “unusual position of turning away customers and capping customer volume,” said Patrick Donnelly, an analyst with Third Bridge.

Moreover, conditions during the first quarter “were more challenging than anticipated and are now expected to extend longer,” the company said.

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