FedEx Freight Cuts 2026 Guidance Amid Weak Demand, June Spinoff Looms

Key Details FedEx Freight reported a 4.7% year-over-year revenue decline to $1.99 billion in its fiscal quarter ended Feb. 28. Tonnage fell 4.8% as shipment volume dropped 5.7%, though higher weights per shipment and yield increases provided partial offsets. The company is executing a strategic shift toward higher-value freight while managing separation costs ahead of its June 1 spinoff from parent FedEx Corp. Why It Matters Management has lowered full-year fiscal 2026 guidance, now expecting adjusted operating income to decline $400 million compared to the prior forecast of a $300 million decline. The revised outlook calls for low-single-digit percentage revenue declines for the full year, with the fourth quarter expected flat to slightly down as yield growth offsets mid-single-digit shipment declines. The 5.9% general rate increase implemented at the start of the year is capturing rates well. What's Next FedEx Freight's operating ratio deteriorated to 93.3%, with salary and wage expenses up 410 basis points as a percentage of revenue. The company has largely completed staffing for its dedicated LTL sales team ahead of independence. An investor day on Apr. 8 in New York will provide long-term revenue and margin targets for the newly independent company, which will trade on the NYSE under ticker FDXF.