FedEx announced on Wednesday that its profits had dropped 12% during their fiscal second quarter. However, the drop was not as much as investors had feared as the shipping company struggled for better results in the airfreight sector of its business.
The demand for air express shipments had dropped since many customers have turned to methods that are slower and on the ground that cost less to have their goods delivered. The fall off in those shipments however were offset by a stronger than expected increase in the segment of the company that uses trucks to make deliveries.
Second quarter earnings for FedEx were $438.1 million that was equal to $1.39 a share, compared to $497 million and $1.57 per share for last year during the same quarter. Thanks to Hurricane Sandy, huge disruptions in deliveries and business occurred throughout the East Coast and lowered the earnings for the company by as much as 11 cents per share, said a company spokesperson.
Factoring out those charges, the company had a profit equal to $1.50 a share, which was 9 cents higher than analysts on Wall Street had forecasted. Following the announcement FedEx shares increased nearly 1% to end the day at $93.21.
The company announced in October plans to revitalize the business and part of that included cutting jobs. The company announced on Wednesday it had extended the period for employee buyouts and expected that thousands of their employees would take advantage of the package.
Revenue during the latest quarter was $11.12 billion, which represented an increase of 4.7% over the $10.6 billion form one year ago during the same reporting period.