The faltering U.S. economy and rising fuel costs have dealt a blow to Memphis' delivery giant, FedEx. FedEx cut its expectations for fourth-quarter earnings to be $1.45 to $1.50 a share, compared to its prior forecast of $1.60 to $1.80 a share.
Chief Financial Officer Alan B. Graf, Jr., said in a press release: "Since we provided earnings guidance for the fourth quarter in March when the crude oil price was slightly above $100 per barrel, our estimated fuel costs for the quarter have increased more than 7 percent, or $100 million from our previous estimate, and the weak economy has restrained demand for U.S. domestic express package and LTL freight services.
"While we have dynamic fuel surcharges in place, they cannot keep pace in the short-term with rapidly rising fuel prices. This revised outlook assumes no additional increases to the current fuel price environment and no further weakening of the economy."