Though the number of employees affected, and their eligibility, is yet to be determined, the buyouts are likely to be concentrated on its FedEx Corporation (NYSE:FDX) and shared-services units, which employ over 158,000 workers. However, as per a clarification from the company, the buyouts will emphasize on support staff, rather than operational personnel, and the vast majority would be from the U.S. The Express unit, which was the hardest hit, as the slowing economy led customers to opt for slower, but cheaper means of delivery. A reduced demand for Asian-manufactured goods from Europe and Asia also contributed to its lack-luster performance.
For its fourth quarter, FedEx Corporation (NYSE:FDX) reported a decline of 1.4 percent in profit at $550 million ($1.73 a share), while revenues rose 3.8 percent to $11 billion. Earnings were impacted adversely by a fall in volumes in the Express shipping division and a charge of $134 million on retired aircraft.
Chief Executive Fred Smith said, “It’s very clear that the door-to-door express segment is growing, and the movement of goods on the water is growing,” while the traditional airport-to-airport business was not growing. The company’s forecast of earnings for the current quarter missed analysts’ expectations.
Rival United Parcel Service, Inc. (NYSE:UPS)’ second quarter results missed market expectations and the company cut its guidance for the fiscal 2012 based on a bleak global economic outlook.
