Q4 2024 FedEx Corporation Earnings Call

Operator: Good day, and welcome to the FedEx Physical Year 2024 Fourth Quarter Earnings Call. All participants are in a listen-only mode.

Good day and welcome to the Fedex physical year 2024, first fourth quarter earnings call. All participants are in a listen only mode should you need.

Operator: Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press the star key, then one on your touch-tone phone.

Speaker Change: Assistance, Please signal conference specialist by pressing the Starkey followed by zero.

After todays presentation, there will be an opportunity to ask questions to ask a question you May Press Star then one on your Touchtone phone.

Speaker Change: Your question. Please press Star then two please note that this event is being recorded I would now like to turn the conference over to Jenny Hollinger, Vice President of Investor Relations. Please go ahead.

Operator: To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Jenny Hollander, Vice President of Investor Relations. Please go ahead.

Jenifer Hollander: Good afternoon, and welcome to FedEx Corporation's 4th Quarter Earnings Conference Call. The 4th Quarter Earnings Release and Statbook are on our website at investors.fedex.com. This call and the accompanying slides are being streamed from our website, where the replay and slides will be available for about one year.

Speaker Change: Good afternoon, and welcome to the Fedex Corporation fourth quarter earnings Conference call the fourth quarter.

Speaker Change: Our earnings release and Stat book are on our website at investors that Fedex Dot com.

Speaker Change: This call and the accompanying slides are being streamed from our website, where the replay and slides will be available for about one year.

Speaker Change: During our Q&A session callers will be limited to one question to allow us to accommodate all those who would like to participate.

Jenifer Hollander: During our Q&A session, callers will be limited to one question to allow us to accommodate all those who would like to participate. Certain statements in this conference call may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements.

Speaker Change: Certain statements in this conference call maybe considered forward looking statements as defined in the private Securities Litigation Reform Act of 1095.

Speaker Change: Such forward looking statements are subject to risks uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward looking statements.

Jenifer Hollander: For additional information on these factors, please refer to our press release and filings with the SEC. Today's presentation also includes certain non-GAAP financial measures. Please refer to the Investor Relations portion of our website at FedEx.com for reconciliation of the non-GAAP financial measures discussed on this call to the most directly comparable GAAP metrics. Joining us on the call today are Raj Subramaniam, President and CEO; Brie Carere, Executive Vice President and Chief Customer Officer; and John Dietrich, Executive Vice President and CFO. Now, I will turn the call over to Raj. Thank you, Jenny.

Speaker Change: For additional information on these factors please refer to our press release and filings with the SEC.

Speaker Change: Today's presentation also includes certain non-GAAP financial measures. Please refer to the Investor relations portion of our website at Fedex Dot com for a reconciliation of the non-GAAP financial measures discussed on this call. The most directly comparable GAAP measures.

Speaker Change: Joining us on the call today are Raj Subramaniam, President and CEO re Crary executive Vice President and Chief customer Officer, and John <unk> Executive Vice President and CFO now I will turn the call over to Raj.

Rajesh Subramaniam: Our fourth-quarter performance marks a strong end to a year of successful execution. We delivered year-over-year operating profit growth and margin expansion in every quarter of FY24. We lowered our capital intensity, reaching our FY25 target of less than 6.5% a year early.

Rajesh Subramaniam: Thank you Jenny our fourth quarter performance marks a strong end to a year.

Successful execution.

Rajesh Subramaniam: We delivered year over year operating profit growth and margin expansion in every quarter of FY 'twenty.

Rajesh Subramaniam: We lowered our capital intensity, reaching our FY 'twenty five target of less than six 5%.

Speaker Change: Hello Lee.

Rajesh Subramaniam: With lower capex and higher free cash flow, we return nearly $4 billion to stockholders, and we meaningfully improve our return on invested capital. However, the entire industry faces a challenging demand environment in FY24. Our team focused on what we could control, and as a result, we delivered full-year earnings towards the higher end of our original guidance range, up 19% year-over-year on an adjusted basis. We did this despite a decline in revenue compared to our initial growth expectations.

Speaker Change: With lower Capex and higher free cash flow, we returned nearly $4 billion to stockholders.

Speaker Change: And we meaningfully improved our return on invested capital.

The entire industry faced a challenging demand environment in FY 'twenty.

Speaker Change: Our team focused on what we could control and assay results, we delivered full year earnings towards the higher end of our origin on guidance range up 19% year over year on an adjusted basis.

Speaker Change: We did this despite a decline in revenue compared to our initial growth expectations.

Rajesh Subramaniam: We also advanced our network transformation, continuing to roll out Network 2.0 and finalizing the transition to OneFedEx, which went into effect June 1st. We did all of this while maintaining an intense dedication to serving our customers, a relentless pursuit of innovation, and an unwavering commitment to our people, service, profit, and culture. Our transformation journey will continue in FY25 as we build on the team's outstanding progress. Now, turning to the quarter in more detail.

Speaker Change: We also advanced our network transformation continuing to rollout network, good auto and finalizing the transition to one Fedex, which went into effect June the first.

Unknown Attendee: We did all of this while maintaining an intense dedication to serving our customers, a relentless pursuit of innovation, and an unwavering commitment to our people's service profit culture.

Speaker Change: We did all of this while maintaining an intense dedication to serving our customers.

Speaker Change: Endless pursuit of innovation, and then unwavering commitment to our people service profit culture.

Rajesh Subramaniam: Our transformation journey will continue in FY25 as we build on the team's outstanding progress. Now turning to the quarter in more detail. At the enterprise level, revenue growth-inflicted positive of this quarter as expected. While we saw modest yield improvement and science of volume stabilization across segments, we have not yet seen a notably increased demand. Continued execution of drive alongside effective expense management enabled your over-year improvements to adjusted operating income margins and earnings per share.

Speaker Change: Our transformation journey will continue in FY 'twenty five.

Speaker Change: As we build on the team's outstanding progress.

Now turning to the quarter in more detail.

Rajesh Subramaniam: At the enterprise level, revenue growth was positive this quarter, as expected. While we saw modest yield improvement and signs of volume stabilization across segments, we have not yet seen a notable increase in demand. Continued execution of DRIVE alongside effective expense management enabled year-over-year improvements to adjusted operating income, margins, and earnings per share. Let me pause here to acknowledge and provide context around the team's tremendous Q4 and full year results. Brown delivered its highest adjusted operating income in company history for both the fourth quarter and the full year.

Speaker Change: At the enterprise level revenue growth inflected positive this quarter as expected.

Speaker Change: We saw modest yield improvement and sign some volume stabilization across segments, we have not yet seen a notable increase in demand.

Speaker Change: Continued execution of drive alongside effective expense management.

Year over year improvements to adjusted operating income margins and earnings per share.

Rajesh Subramaniam: Let me pass here to acknowledge and provide context for our team's tremendous Q4 and for your results. Round, delivered at highest adjusted operating income in company history for both the fourth quarter and the full year. At Freight, fourth quarter operating income increased despite significant demand weakness. In fact, because of her strong fourth quarter performance, freight ended fiscal year 2024, which fully are operating margin equal to last year's all-time high. Adjusting adjusted expressed operating margin increased sequentially in the quarter, but declined year or year as expected. We continue to take action to unlock the full profit opportunity that exists in this business.

Speaker Change: Let me pause here to acknowledge and provide context around the team's tremendous Q4 and full year results.

Speaker Change: Brown delivered its highest adjusted operating income in company history.

Speaker Change: Both the fourth quarter and the full year.

Speaker Change: At freight.

Rajesh Subramaniam: Fourth Quarter Operating Income Increased Despite Significant Demand Weakness, In fact, because of her strong fourth quarter performance, great end of fiscal year 2024. Fully our operating margin equal to last year's all-time high. Adjusted Express Operating Margin increased sequentially in the quarter, but declined year-over-year as expected.

Speaker Change: Fourth quarter operating income increased despite significant demand weakness.

Speaker Change: In fact, because of our strong fourth quarter performance great ended fiscal year 2024.

Speaker Change: Full year operating margin equal to last year's all time high.

Speaker Change: Adjusting adjusted Express operating margin increased sequentially in the quarter.

Speaker Change: But declined year over year as expected.

Rajesh Subramaniam: We continue to take action to unlock the full profit opportunity that exists in this business. Drive continues to change the way we work at FedEx. We've achieved our target. $1.8 billion in structural costs out in FY24, with approximately $500 million from Air Network and International, $550 million from GNA, and $750,000,000 from Surface Network.

Speaker Change: We continue to take actions to unlock the full profit opportunity that exists in this business.

Rajesh Subramaniam: Drive continues to change the way we work at FedEx. We achieved our target of $1.8 billion in structural cost out in FY24. With approximately $500 million from AirNetwork and International, $550 million from GNA, and $750 million from Surface Network. In our AirNetwork, structural network transformation and reduced flight hours drove the Q4 save. Within GNA, we realized procurement savings by centralizing third-party transportation, short equipment, and outside service contracts. For Surface Network, continue to maximize the use of rail. As part of that effort, freight now handles nearly 90% of the trade volume, up from about 25% just one year ago.

Speaker Change: Drive continues to change the way we work at Fedex we.

Speaker Change: We've achieved our target.

Speaker Change: A $1 8 billion and structural cost out in FY 'twenty.

Speaker Change: With approximately $500 million from Air network in international.

Speaker Change: <unk> hundred $50 million from G&A and $750 million from surface network.

Rajesh Subramaniam: In our air network, structural network transformation, and reduced flight hours drove the Q4 safe. Within GNA, we realize procurement savings by centralizing third-party transportation, Assort Equipment, and Outside Service Contracts. Surface Networks continues to maximize the use of rail, part of that effort.

Speaker Change: And our air network.

Speaker Change: Network transformation and.

Speaker Change: And reduced flight hours drove the Q4.

Speaker Change: Within G&A, we realized procurement savings by centralizing third party transportation.

Speaker Change: Equipment and outside service contracts.

Speaker Change: Our surface network continued to maximize the use of rail.

Speaker Change: As part of that effort.

Rajesh Subramaniam: Break now handles nearly 90% of the dredge volume, up from about 25% just one year ago. Looking ahead, we are firmly on track to achieve our target of $4 billion of savings in FY25, compared to FY23. Let me spend a moment on Europe, where we are executing on the $600 million FY25 Drive Savings Target we have shared previously. I would like to thank Karen Reddington for her more than 27 years of service at FedEx, most recently as our European Regional President. A couple of weeks ago, Karen announced her impending retirement. We wish her all the very best. Walter Rose, who is an exceptionally seasoned and experienced executive, will become our Europe regional president on July 1st.

Speaker Change: Great now handles nearly 90% of the drayage volume up from about 25% just one year ago.

Rajesh Subramaniam: Looking ahead, we are firmly on track to achieve our target of $4 billion of savings in FY25 compared to the FY23 baseline.

Speaker Change: Looking ahead, we are firmly on track to achieve our target of $4 billion of savings in FY 'twenty five.

Speaker Change: Compared to the FY2023 baseline.

Rajesh Subramaniam: Let me spend a moment on Europe, where we are executing on the $600 million FY25 drive saving target. We have shared previously.

Speaker Change: Let me spend a moment on Europe, where we are executing on the $600 million FY 'twenty five drive savings target we have shared previously.

Rajesh Subramaniam: I would like to thank Carol Reddington for her more than 27 years on Surface Network. Most recently, at our Europe Regional Presence, a couple of weeks ago, Karen announced her impending retirement. We wish her all the very best. Walker rolls with an exceptionally seasoned and experienced executive will become our Europe Regional Presidents on July 1st. I'm confident that under Walter's leadership, the team will continue to advance drive initiatives to support improved performance. John, Brie, other FedEx executives, and I, we're in Europe visiting the team just last week. Our team members, they are working with rigor to execute on our efficiency plans.

Speaker Change: I would like to thank Karen Reddington, our more than 27 years of service at Fedex.

Speaker Change: Most recently and so Europe regional President.

A couple of weeks ago announced our impending retirement.

Speaker Change: We wish her all the very best.

Speaker Change: <unk> was an exceptionally seasoned and experienced executive.

Speaker Change: We will become our Europe regional presidents on July the first water has been leading our Europe drive domain since its 2022 inception.

Rajesh Subramaniam: Water has been leading our Europe drive domain since its 2022 inception. I'm confident that under Walter's leadership, the team will continue to advance drive initiatives. Support Improved Performance John, Brie, other FedEx executives, and I were in Europe visiting the team just last week. Our team members there are working with rigor to execute on our efficiency plans, and our performance improved on a year-over-year basis. Fourth Quarter Route Optimization, Improved Start Processes, and Productivity Gains led our Europe Drive Domain Savings. Key actions are already underway for FY25. I left the continent encouraged by our progress and with even more conviction in the opportunity ahead.

I'm confident that under Walter's leadership team will continue to advance drive initiatives to support improved performance.

Speaker Change: John Brea other facts Fedex executives and I were in Europe Vincent.

Speaker Change: Visiting the team just last week.

Speaker Change: Our team members they are working with rigor to execute on our efficiency plans.

Rajesh Subramaniam: Their performance improved on a year-over-year basis. The fourth quarter of the organization improved thought processes and productivity gains led our Europe drive the main savings. The actions are already underway for FY25.

Speaker Change: Performance improved on a year over year basis.

Speaker Change: The fourth quarter.

Speaker Change: Amortization.

Speaker Change: <unk> thought processes and productivity gains led our Europe drive domain savings.

Speaker Change: Actions are already underway for FY 'twenty five.

Rajesh Subramaniam: I left the continent and encouraged by a progress and would even more conviction in the opportunity at.

Speaker Change: I left the constant and encouraged by our progress and with even more conviction in the opportunity ahead.

Rajesh Subramaniam: On June 1, we reached an important milestone in our transformation. What we call one FedEx. This is the consolidation of FedEx Express, FedEx Ground, and FedEx Services into Federal Express Corporation. There are many benefits. This foundational step improves efficiency and reduces cost. It allows our teams to move with speed and makes it easier for our team members to manage their FedEx careers. In Q4, we also continue to roll out Network 2.0, including the launch in Canada, or allow just market yet. The first half of FY25, we will complete the Canada transition to optimize dozens of additional locations in the US.

Rajesh Subramaniam: On June 1, we reached an important milestone in our transformation, what we call One FedEx. This is the consolidation of FedEx Express, FedEx Ground, and FedEx Services into FedEx Corporation. There are many benefits.

On June one we reached an important milestone in our transformation.

Speaker Change: What we call <unk>.

Speaker Change: Fedex.

Speaker Change: This is the consolidation of Fedex Express Fedex ground and Fedex services.

Speaker Change: Two federal Express operation.

Speaker Change: There are many benefits this foundational step improves efficiency and reduces costs allows our teams to move with speed and <unk>.

Rajesh Subramaniam: This foundational step improves efficiency and reduces cost, allows our teams to move with speed, and makes it easier for our team members to manage their FedEx careers. In Q4, we will also continue to roll out Network 2.0, including the launch in Canada, our largest market yet. In the first half of FY25, we will complete the Canada transition and optimize dozens of additional locations in the U.S. We expect to significantly pick up the pace into FY26.

Speaker Change: Makes it easier for our team members to manage their Fedex careers.

Speaker Change: In Q4, we also continued to rollout network put auto.

Speaker Change: Clearly the launch in Canada.

Speaker Change: Largest market yet.

Speaker Change: In the first half of FY 'twenty five.

Speaker Change: We'll complete the Canada transition opt.

Speaker Change: Optimized dozens of additional locations in the U S.

Rajesh Subramaniam: We expect to significantly think of the pace into FY26. Importantly, even as we streamline our structure, we are maintaining our strong service levels. And we continue to offer the widest portfolio of services with the most compelling value proposition for our customers. Integrated portfolio offering is a long-term driver of sustained profit improvement and a key enabler of our Tri-color network design. We also continue to leverage data to create a more flexible, efficient, and intelligent network. In November of 2023, we began introducing a new tool to our contract and service providers in the US to track and drive improvement across e-operating metrics, to demand, safety, service, and productivity.

Speaker Change: We expect to significantly pick up the pace into FY 'twenty.

Rajesh Subramaniam: Importantly, even as we streamline our structure, we are maintaining our strong service level, and we continue to offer the widest portfolio of services with the most compelling value proposition for our customers. Our integrated portfolio offering is a long-term driver of sustained profit improvement and a key enabler of our tricolor network design. We also continue to leverage data to create a more flexible, efficient, and intelligent network.

Speaker Change: Importantly, even as we streamline our structure we have.

Speaker Change: Maintaining our strong service levels and we continue to offer the widest portfolio of services with the most compelling value proposition for our customer.

Speaker Change: Our integrated portfolio offering is a long term driver of sustained profit improvement and a key enabler of our tricolor network design.

We also continue to leverage data to create a more flexible efficient and intelligent network.

Rajesh Subramaniam: In November of 2023, we began introducing a new tool to our contracted service providers in the U.S. to track and drive improvement across key operating metrics tied to demand, safety, service, and productivity. This tool is a common platform that we plan to scale globally, providing insights and enabling outcomes that are beneficial to FedEx. Contracted Service Providers and our customers. Across the 65% of service providers currently using the platform, it's already driving service and safety improvements, which are translating into cost savings. Real-time visibility tools like this are critically important.

In November of 2023, we began introducing a new tool to our contracted service providers in the U S to track and drive improvement across key operating metrics tied to demand safety service and productivity.

Rajesh Subramaniam: This tool is a common platform that we plan to scale globally, fighting insights and enabling outcomes that are beneficial to FedEx, or contracted service providers and our customers. Thomas, across the 65% of service providers currently using the platform, it's already driving service and safety improvements, which are translating into cost sales. Real-time visibility tools like this are particularly important, as we start to quote packages across our network, the respective of service offerings.

Speaker Change: This too is a common platform that we plan to scale globally.

Speaker Change: Adding insights, enabling outcomes that are beneficial to Fedex, our contracted service providers and our customers.

Speaker Change: Across the 65% of service providers currently using the platform is already driving service and safety improvements, which are translating into cost savings.

Speaker Change: Real time visibility tools like this are particularly important.

Rajesh Subramaniam: As we start to flow packages across our network, the respective office servers offer: Our FY24 results create a strong foundation as we kick off the new fiscal year. In fiscal 2025, we will continue to execute our transformation strategy and expect to deliver adjusted EPS growth of 12 to 24%. John will provide more detail on our outlook and the underlying assumptions shortly. With the recent completion of the FY25 planning process, we have turned our focus to the next phase of our long-term stockholder value creation plan.

Speaker Change: As we start to flow packages across our network irrespective of service offerings.

Rajesh Subramaniam: Our FY24 results made a strong foundation as we kick off the new fiscal year. In fiscal 2025, we will continue to execute our transformation strategy and expected deliverer adjusted EPS growth of 12 to 24%. John will provide more detail on our workload and the underlying assumptions shortly.

Our FY 'twenty four results laid a strong foundation SBC cost the new fiscal year.

Speaker Change: In fiscal 2025.

Speaker Change: We'll continue to execute our transformation strategy and expect to deliver adjusted EPS growth.

Speaker Change: The 24%.

Speaker Change: John will provide more detail on our outlook and the underlying assumptions shortly.

Rajesh Subramaniam: With the recent completion of the FY25 planning process, we have turned our focus to the next phase of our long-term pop-order evaluation plan. As a part of this work, a management team and the Board of Directors, along with outside advisors, are conducting an assessment of the role of FedEx Freight, you know, portfolio structure and potential steps to further unlock sustainable shareholder value. We're committed to completing this review thoroughly and deliberately by the end of the calendar year. We'll conduct this assessment while continuing to focus on customers, team members, and the safety of our operations.

With the recent completion of the FY 'twenty by planning process, we have turned our focus to the next phase of our long term stockholder value creation plan.

Rajesh Subramaniam: As a part of this work, the management team and the board of directors, along with outside advisors, are conducting an assessment of the role of FedEx Freight in our portfolio structure and Potential Steps to Further Unlock Sustainable Shareholder Values. We are committed to completing this review thoroughly and deliberately by the end of the calendar year, and we will conduct this assessment while continuing to focus on customers, team members, and the safety of our operation. Before I close...

Speaker Change: As a part of this work our management team and the board of directors along with outside advisers are conducting an assessment of the role of Fedex freight.

Speaker Change: Our portfolio structure.

Potential steps to further unlock sustainable shareholder value.

Speaker Change: We're committed to completing this review early and deliberately by the <unk>.

Speaker Change: End of the calendar year.

Speaker Change: We'll conduct this assessment, while continuing to focus on customers team.

Speaker Change: Team members and the safety of our operations.

Rajesh Subramaniam: Before I close, I want to thank our FedEx team members for the continued commitment to our customers and their focus execution in FY24. I'm truly excited, but the value creation opportunities in front of us as we continue to win profitable share, execute our structural cost initiatives, and leverage the insight from the best amount of data we compile from moving more than $2 trillion worth of goods every single year. We're firmly on track to achieve our $4 billion FY25 drive cost savings target compared to the FY23 baseline. We expect another $2 billion to follow from network 2.0, or try call strategy will improve the efficiency and asset utilization of the entire FedEx system.

Speaker Change: Before I close.

Rajesh Subramaniam: I want to thank our FedEx team members for their continued commitment to our customers and their focused execution in FY24. I'm truly excited about the value creation opportunities in front of us. As we continue to win profitable share... execute on our Structural Cost Initiative and leverage the insights from the vast amount of data we compiled from moving more than a trillion dollars worth of goods every single year. We are firmly on track to achieve our $4 billion FY25 drive cost savings target compared to the FY23 baseline, and we expect another $2 billion to follow from Network 2.0.

Speaker Change: I want to thank our Fedex team members for their continued commitment to our customers and their focus.

<unk> fusion in FY 'twenty four.

I am truly excited but the value creation opportunities in front of us as we continued to win profitable share.

Speaker Change: Execute on our structural cost initiatives.

Speaker Change: And leverage the insights from the.

Speaker Change: Vast amount of data, we compile from moving more than two trillion dollars worth of goods every single year.

Speaker Change: We are firmly on track to achieve our $4 billion FY 'twenty five drive cost savings target compared to the FY2023 baseline.

Speaker Change: We expect another $2 billion to follow from network <unk>.

Rajesh Subramaniam: A tricolor strategy will improve the efficiency and asset utilization of the entire FedEx system. We expect to continue lowering our capital intensity, improving our OIC. Growing free cash flow and delivering significant returns to stockholders. We have a clear line of sight to achieving 10% adjusted operating margin on $100 billion in revenue. I have never been more confident in our future as we create the world's most flexible, efficient, and intelligent network. With that, let me turn the call over to Brie.

Speaker Change: Our tricolor strategy will improve the efficiency and asset utilization of the entire Fedex system.

Rajesh Subramaniam: We expect to continue lowering our capital intensity, improving our OIC, growing free cash flow, and delivering significant returns to stockholders. We have a clear line of sight that achieving 10% adjusted operating margin on $100 billion revenue.

Speaker Change: We expect to continue lowering our capital intensity improves.

Speaker Change: Improving ROIC.

Growing free cash flow and delivering significant returns to stockholders.

Speaker Change: We have a clear line of sight to achieving 10% adjusted operating margin on 100 billion.

Speaker Change: Revenue.

Rajesh Subramaniam: I have never been more confident in our future as we create the world's flexible, efficient, and intelligent network. Put that.

Speaker Change: I have never been more confident in our future as we create the world's most flexible.

Speaker Change: Vision and intelligent network.

With that let me turn the call over to Bruce.

Brie Carere: Let me turn the call over to Breeze. Thank you, Raj. Good afternoon, everyone. I want to congratulate our team on their outstanding Q4 and full year performance. Justin operating margin expansion of 110 basis points and adjusted EPS up 19%. This is a very strong result in a year where revenue was down 3% or nearly $2.5 billion. We also reduced our capital intensity and achieved our capex to revenue target, a 6.5% or less, a year ahead of schedule. And with the continued strong cash flow and lower capital intensity, we returned to nearly $4 billion stockholders. These results reinforce that our transformation efforts are taking hold and demonstrate our commitment to creating value for our shareholders.

Brie Carere: Thank you Raj and good afternoon everyone. I want to congratulate our team on their outstanding Q4 and full year performance. Our service and speed advantages continue to attract customers in high-value industries and segments. With this focus on profitable growth, we have continued to gain market share both in the United States and around the world. We are very pleased to see revenue growth turn positive in the fourth quarter with volume stabilization and modest yield improvement. Let's review fourth quarter top-line performance by segment on a year-over-year basis. At FedEx Ground, revenue increased 2% on a 1% increase in yield and a 1% increase in volume, driven by ground commercial.

Bruce: Thank you Raj and good afternoon, everyone I want to congratulate our team on their outstanding Q4, and full year performance.

Bruce: Our service and speed advantages continue to attract customers and high value industries and segments.

Bruce: This focus on profitable growth, we have continued to gain market share both in the United States and around the world.

Bruce: We are very pleased to see revenue growth turned positive in the fourth quarter with volume stabilization and modest yield improvement.

Brie Carere: FedEx Freight revenue increased 2%, driven by higher yields. Average daily shipments increased slightly. At FedEx Express, revenue in the fourth quarter was flat, with package yield up 2%.

Bruce: Let's review fourth quarter topline performance by segment on a year over year basis.

Bruce: At Fedex ground revenue increased 2% on a 1% increase in yield and a 1% increase in volume driven by ground commercial.

Bruce: At Fedex freight revenue increased 2% driven by higher yields average daily shipments increased slightly.

Bruce: At Fedex Express revenue in the fourth quarter was flat with package yield up 2%.

Brie Carere: While positive, yield growth was pressured by a tapering of international export demand surcharges and an increasing mix of deferred services. International yields were also pressured by an increased capacity in the global air cargo market. Turning now to monthly volume trends during the quarter, volumes continue to stabilize. In U.S. domestic package, year-over-year volume declines continue to moderate.

Bruce: While positive yield growth was pressured by a tapering of international export demand surcharges, and an increasing mix of deferred services.

Bruce: International yields were also pressured by an increased capacity in the global air cargo market.

Bruce: Turning now to monthly volume trends during the quarter.

Bruce: Volumes continue to stabilize and U S domestic package year over year volume declines continued to moderate.

Brie Carere: International export package volume increased 8% in the quarter, driven by the international economy, largely consistent with the monthly trends we saw last quarter. Our continued focus on reliable service at ground led to volume improvements in ground commercial. FedEx freight shipments improved positively as the quarter progressed, as we lapped last year's demands off. As we previously announced, our contract with the United States Postal Service will expire on September 29th.

Bruce: International export package volume increased 8% in the quarter driven by international economy, largely consistent with the monthly trends, we saw last quarter.

Bruce: Our continued focus on reliable service at ground of volume improvement and Brown commercial.

Bruce: Fedex freight shipments inflected positive as the quarter progressed as we lapped last year's demand softness.

Bruce: As we previously announced our contract with the United States Postal service will expire on September 29.

Brie Carere: Until then, we will continue to meet our service commitments. We expect volumes to be near the contract minimum, consistent with what we saw in the fourth quarter. After the expiration of the contract, we will implement adjustments for our operations and network that will drive efficiencies and create more flexibility. Similar to last quarter, the pricing environment remains competitive but rational. During the fourth quarter, we continued to grow yield as we focused on profitable growth and revenue quality. At Express, package yield increased 2%, driven by higher U.S. domestic package yield, partially offset by international export yield pressure.

Bruce: Until then we will continue to meet our service commitments.

Bruce: We expect volumes to be near contracts minimum consistent with what we saw in the fourth quarter.

Bruce: After the expiration of the contract we will implement adjustments for our operation and network that will drive efficiencies and create more flexibility.

Bruce: Similar to last quarter, the pricing environment remains competitive but rational.

Bruce: During the fourth quarter, we continue to grow yield as we focus on profitable growth and revenue quality.

Bruce: At express package yield increased 2% driven by higher U S domestic packaging, partially offset by international export yield pressure.

Brie Carere: FedEx ground yield increased 1% driven by home delivery and ground commercial. Our value proposition is translating to increased ground commercial market share gains, which positively contributed to our yield. And at FedEx Freight, revenue per shipment was up 1%, driven by a continued focus on revenue quality as we grew share in the most attractive parts of the market. This was Freight's strongest yield performance since the third quarter of fiscal year 23.

Bruce: At Fedex ground yield increased 1% driven by home delivery and ground commercial.

Our value proposition is translating to increased crown commercial market share gain which positively contributed to our yield.

Bruce: At Fedex freight revenue per shipment was up 1% driven by a continued focus on revenue quality as we grew share in the most attractive parts of the market.

Bruce: This was for its strongest performance since the third quarter of fiscal year 'twenty three.

Brie Carere: In light of the overall pricing environment, I am very pleased to report that we had a very strong U.S. domestic capture rate on the 5.9% GRI in January. We've recently announced fuel surcharge table increases across our services, which should also benefit yields in fiscal year 25. We continue to enhance our portfolio and value proposition to drive profitable growth. Our world-renowned brand, the breadth of our network, and our strong reliability, along with our digital portfolio, are winning the hearts and minds of customers around the world. A few commercial highlights I would like to share.

Bruce: In light of the overall pricing environment I am very pleased to report that we had a very strong U S domestic capture rate on the five 9% Gi in January.

We've recently announced fuel surcharge table increases our cross our services, which should also benefit in fiscal year 'twenty five.

Bruce: We continue to enhance our portfolio and value proposition to drive profitable growth.

Bruce: Our world renowned brand the breadth of our networks and our strong reliability as long with our digital portfolio, our winning the hearts and the minds of customers around the world.

A few commercial highlights I would like to share.

Brie Carere: We are very proud of our healthcare portfolio. Last year, as part of our commercial drive focus, we increased our focus on this attractive segment and experienced great results. We have over $1 billion of healthcare-related revenue that comes from customers who utilize FedEx Surrounds. The FedEx Surrounds platform provides insights to help our customers monitor and solve their supply chain challenges. Surround gives customers real-time visibility into their shipments by combining information about the package with external data, such as weather, to predict delivery timeliness and mitigate the risk of disruption.

Bruce: We are very proud of our health care portfolio last year as part of our commercial drive focus we increased focus on this attractive segment and experienced great results.

Bruce: We have over $1 billion of health care related revenue that comes from customers, who utilize fedex around.

Bruce: The Fedex surround platform provides insights to help our customers monitor and solve their supply chain challenges.

Bruce: Surround give customers real time visibility into their shipment by combining information about the package with external data such as whether to predict delivery timeliness and mitigate the risk of disruption.

Brie Carere: Another critical element of our healthcare strategy is our ability to demonstrate our high reliability and our ability to meet customer quality agreements. A quality agreement is essentially a customized standard operating procedure for critical healthcare shipments. In fiscal 24, we signed new quality agreements for customers tied to over $500 million in revenue. As we expand our healthcare portfolio, we'll continue to focus on high-value areas like clinical trials. Earlier this month, in the Netherlands, we opened our first European Life Sciences Center.

Bruce: Another critical element of our health care strategy is our ability to demonstrate our high reliability and our ability to meet customer quality agreements.

The quality agreement is essentially a customized standard operating procedure for critical health care shipments.

In fiscal 'twenty, four we signed new quality agreements for customers tied to over $500 million in revenue.

Bruce: As we expand our health care portfolio will continue to focus on high value areas like clinical trials.

Bruce: Earlier this month in the Netherlands, We opened our first European Life Sciences Center.

Brie Carere: This state-of-the-art cooling facility is the sixth of its kind in our global network, offering an end-to-end supply chain solution for temperature-sensitive medical storage and transport. In addition to the tremendous work with our healthcare customers, our e-commerce portfolio is the most robust in the market. We have the best speed, coverage, and capabilities. Get your proof of delivery with a great new feature to improve customer confidence. We recently launched our Pitcher Proof of Delivery API. These APIs enable our customers to expose picture proof of delivery within their own branded notifications and websites.

Bruce: This state of the art cooling facility is the six of its kind in our global network offering an end to end supply chain solution for temperature sensitive medical storage and transport.

Bruce: In addition to the tremendous work with our health care customers are E. Commerce portfolio is the most robust in the market.

We have the best speed coverage and capabilities.

Bruce: And your proof of delivery with a great new features to improve customer confidence.

Bruce: We recently launched our picture proof of delivery API.

Bruce: These API to enable our customers to expose picture proof of delivery within their own branded notifications and websites.

Brie Carere: This quarter, we signed several new pricing agreements with large retailers for our new Pitcher Proof of Delivery API. This is a great differentiator and represents what will be the first of many wins for our new FDX platform. Looking ahead, in fiscal year 25, we expect the demand environment to moderately improve as we move through the year. Currently, we expect U.S. domestic parcel and LGL volumes to continue to improve with the year-over-year increase growing as the year progresses. International air cargo demand from Asia accelerated in early May and was stronger versus previous expectations.

Bruce: This quarter, we signed several new pricing agreements with large retailers for our new Hampshire proof of delivery API.

Bruce: This is a great differentiator and represents what will be the first of many wins for our new <unk> platform.

Bruce: Looking ahead in fiscal year 'twenty five we expect the demand environment to moderately improve as we move through the year.

Bruce: Currently we expect U S domestic parcel and algae oil volumes to continue to improve with the year over year increase growing as the year progresses.

International Air cargo demand from Asia accelerated in early May and is stronger versus previous expectations.

Brie Carere: We expect year-over-year growth to be driven by e-commerce and low inventory levels. Shippers are facing tightened capacity both in air and sea freight services. Red Sea disruptions have further exacerbated shipper challenges from Asia to Europe.

Bruce: We expect year over year growth to be driven by e-commerce and low inventory levels.

<unk> are facing tightened capacity, both in air and sea freight services.

Bruce: Wed see disruptions have further exacerbated shepherd challenges from Asia to Europe.

Brie Carere: These conditions should bring strength to overall air freight yields from Asia. In closing, I am very confident in our outstanding team, our strong value proposition, and our new digital solutions. These will continue to power our success as we build on our momentum in fiscal year 25. And with that, I'll turn it over to John to discuss the financials in more detail. Thanks, Brie.

Bruce: These conditions should bring strength to the overall airfreight yields from Asia.

Speaker Change: In closing I am very confident in our outstanding team, our strong value proposition and our new digital solutions. These will continue to power our success as we build on our momentum in fiscal year, 'twenty, five and with that I'll turn it over to John to discuss the financials in more detail.

John W. Dietrich: For fiscal year 24, we delivered $6.2 billion of adjusted operating profit, which is nearly a $900 million or 16% year over year improvement. Adjusted Operating Margin Expansion of 110 basis points, and adjusted EPS up 19%. This is a very strong result in a year where revenue was down 3% or nearly $2.5 billion. We also reduced our capital intensity and achieved our CapEx to Revenue Target of 6.5% or less, a year ahead of schedule.

John W. Dietrich: Thanks, Bree for fiscal year 'twenty four we delivered $6 2 billion of adjusted operating profit, which is nearly a $900 million or 16% year over year improvement.

<unk> operating margin expansion of 110 basis points and adjusted EPS up 19%.

This is a very strong result in a year, where revenue was down 3% or nearly $2 5 billion.

John W. Dietrich: We also reduced our capital intensity and achieved our capex to revenue target of six 5% or less a year ahead of schedule.

John W. Dietrich: And with the continued strong cash flow and lower capital intensity, we returned nearly $4 billion to shareholders. These results reinforce that our transformation efforts are taking hold and demonstrate our commitment to creating value for our shareholders. Taking a closer look at our Q4 consolidated performance on a year-over-year basis, adjusted operating income increased by over $100 million, and adjusted operating margin expanded by 40 basis points. On that ground, the team delivered another strong quarter.

John W. Dietrich: And with the continued strong cash flow and lower capital intensity, we returned nearly $4 billion to stockholders.

John W. Dietrich: These results reinforce that our transformation efforts are taking hold and demonstrate our commitment to creating value for our shareholders.

Brie Carere: Taking a closer look at our Q4 consolidated performance on a year-over-year basis, adjusted operating income increased by over 100 million dollars, and adjusted operating margin expanded by 40 basis points. At ground, the teams delivered another strong quarter; adjusted operating income increased by 133 million dollars, and adjusted operating margin expanded by 130 basis points. This was driven by continued progress on drive increased yield, lower self insurance cost, and commercial volume growth. At freight operating income increased by 58 million dollars and operating margin improved by 220 basis points driven by higher yield. Frates' continued focus on revenue quality and cost management has enabled improved profitability despite the soft demand environment.

John W. Dietrich: Taking a closer look at our Q4 consolidated performance on a year over year basis adjusted operating.

John W. Dietrich: Operating income increased by over $100 million.

John W. Dietrich: And adjusted operating margin expanded by 40 basis points.

At ground the team delivered another strong quarter.

John W. Dietrich: Adjusted operating income increased by $133 million, and adjusted operating margin expanded by 130 basis points. This was driven by continued progress on drive, increased yield, lower self-insurance costs, and commercial volume growth. At Freight, operating income increased by $58 million, and operating margin improved by 220 basis points, driven by higher yield. Freight's continued focus on revenue quality and cost management has enabled improved profitability despite the soft demand environment. As expected, Adjusted Operating Income at Express fell by $92 million in the quarter, and Adjusted Operating Margin was down 90 basis points.

John W. Dietrich: Adjusted operating income increased by $133 million and adjusted operating margin expanded by 130 basis points.

John W. Dietrich: This was driven by continued progress on drive increased yield lower self insurance costs and commercial volume growth.

John W. Dietrich: At freight operating income increased by $58 million and operating margin improved by 220 basis points driven by higher yields.

John W. Dietrich: Rates continued focus on revenue quality and cost management has enabled improved profitability. Despite the soft demand environment.

Brie Carere: As directionally expected, adjusted operating income at Express fell by 92 million dollars in the quarter, and adjusted operating margin was down 90 basis points. Express results were pressured by lower international yield, higher purchased transportation costs due to the launch of our tricolor initiative, and a headwind from annual incentive compensation. Drive cost reductions and higher U.S. domestic package yield partially offset these pressures. With respect to Europe, earlier this month, we announced a plan reduction in the size of our European non-operational staffing to further support and express profit improvement. We expect a hundred and twenty-five to a hundred and seventy-five million dollars in annualized benefits beginning in FY twenty-seven with tailwinds starting later in FY twenty-six.

John W. Dietrich: As Directionally expected adjusted operating income at express fell by $92 million in the quarter and adjusted operating margin was down 90 basis points.

John W. Dietrich: Express Results were pressured by lower international yield, higher purchased transportation costs due to the launch of our Tri-Color Initiative, and Headwind from Annual Incentive Compensation. However, driving cost reductions and higher U.S. domestic package yield partially offset these pressures. With respect to Europe, earlier this month, we announced a planned reduction in the size of our European non-operational staffing to further support express profit improvement. We expect $125 to $175 million in annualized benefits beginning in FY27, with tailwinds starting later in FY26.

John W. Dietrich: Express results were pressured by lower international yields higher purchased transportation costs due to the launch of our tricolor initiative.

John W. Dietrich: And a headwind from annual incentive compensation.

John W. Dietrich: Drive cost reductions and higher U S domestic package yield partially offset these pressures.

John W. Dietrich: With respect to Europe earlier, this month, we announced a planned reduction in the size of our European non operational staffing to further support express profit improvement.

John W. Dietrich: We expect $125 million to $175 million in annualized benefits beginning in FY 'twenty seven.

John W. Dietrich: With tailwind starting later in FY 'twenty six.

John W. Dietrich: Decisions like these are never easy, but they are a necessary step to improve profitability in the region. In addition to our segment results, our fourth-quarter results include a non-cash impairment charge of $157 million relating to our decision to permanently retire 22 Boeing 757 aircraft from our U.S. domestic network, along with seven related engines. These actions, coupled with the previously announced retirement of nine MV-11s in the quarter, resulted in the permanent removal of 31 jet aircraft from our fleet in FY24.

Brie Carere: Decisions like these are never easy, but are unnecessary step to improve profitability in the region. In addition to our segment results, our fourth quarter results include a non-cash impairment charge of a hundred and fifty seven million dollars relating to our decision to permanently retire. Wanting to Boeing seven five seven aircraft from our U.S. domestic network along with seven related engines. These actions coupled with the previously announced retirement of nine and the 11th and the quarter resulted in the permanent removal of 31 jet aircraft from our fleet in FY twenty four. This reflects our strategy to continue to right size our air network capacity with demand and unlock additional operating efficiencies.

John W. Dietrich: Decisions like these are never easy, but are a necessary step to improve profitability in the region.

John W. Dietrich: In addition to our segment results our fourth quarter results include a noncash impairment charge of $157 million.

John W. Dietrich: Relating to our decision to permanently retire 22, Boeing 737 aircrafts from our U S domestic network along with seven related engines.

John W. Dietrich: These actions coupled with the previously announced retirement of nine and 11 in the quarter resulted in the permanent removal of 31 jet aircraft from our fleet in FY 'twenty four.

John W. Dietrich: This reflects our strategy to continue to right-size our air network capacity with demand and unlock additional operating efficiency. Now turning to our outlook for fiscal year 25, our adjusted earnings outlook range for the year is $20 to $22 per share.

This reflects our strategy to continue to rightsize, our air network capacity with demand and to unlock additional operating efficiencies.

Brie Carere: Now turn to our outlook for fiscal year 25. Our adjusted earnings outlook range for the year is $20 to $22 per share. Let me talk to our key assumptions and variables. Starting with revenue, we expect low to mid-single digit growth, driven by improving trends in US domestic parcel and international export demand. The primary factors that will ultimately determine our revenue growth are the rate of yield expansion, the pace of global industrial production, and growth of domestic e-commerce. We expect FY25 yields to benefit from both improved base rates and increased fuel surcharges. In consistent with what we have seen over the past year, we're anticipating a pricing environment that is competitive but rational.

John W. Dietrich: Now turning to our outlook for fiscal year 'twenty five.

John W. Dietrich: Our adjusted earnings outlook range for the year is $20 to $22 per share.

John W. Dietrich: Let me talk through our key assumptions and variables. Starting with revenue, we expect low to mid-single-digit growth, driven by improving trends in U.S. domestic parcel and international export demand. Primary factors that will ultimately determine our revenue growth are the rate of yield expansion, the pace of global industrial production, and growth of domestic e-commerce. We expect FY 25 yields to benefit from both improved base rates and increased fuel surcharges.

John W. Dietrich: Let me talk to our key assumptions and variables.

John W. Dietrich: Starting with revenue, we expect low to mid single digit growth drew.

John W. Dietrich: Driven by improving trends in U S domestic parcel and international export demand.

John W. Dietrich: The primary factors that will ultimately determine our revenue growth or the rate of yield expansion the pace of global industrial production.

John W. Dietrich: And growth of domestic ecommerce.

John W. Dietrich: We expect FY 'twenty five yields to benefit from both improved base rates and increased fuel surcharges.

John W. Dietrich: Consistent with what we have seen over the past year, we're anticipating a pricing environment that is competitive, but rational. On the expense side, we remain committed to aggressively managing our cost structure, including the incremental $2.2 billion benefit tied to drive. I'll walk you through the puts and takes in our FY25 Operating Profit Bridge in a moment. At the business level, in fiscal year 25, we expect a newly combined express, ground, and services segment, now called Federal Express, to be the larger driver of FY25 adjusted income and margin improvement, and we expect FedEx freight margins to be up modestly year over year. Due to both yield and volume growth. I'd also like to provide some color on our quarterly cadence in light of the U.S. Postal Service contract expiration at the end of September.

John W. Dietrich: And consistent with what we have seen over the past year were anticipating a pricing environment that is competitive but rational.

Brie Carere: On the expense side, we remain committed to aggressively managing our cost structure, including the incremental $2.2 billion benefit tied to Drive. I'll walk you through the puts and takes in our FY25 operating profit bridge in a moment. But at the business level, in fiscal year 25, we expect a newly combined express ground in services segment, now called Federal Express, to be the larger driver of FY25 adjusted income and margin improvement. And we expect that excret margins to be up modestly year over year, we to both yield and volume growth. I'd also like to provide some color on our quarterly cadence in light of the U.S. Postal Service contract expiration at the end of September.

John W. Dietrich: On the expense side, we remain committed to aggressively managing our cost structure, including the incremental $2 2 billion benefit tied to drive.

Speaker Change: I'll walk you through the puts and takes in our FY 'twenty operating profit bridge in a moment, but.

Speaker Change: But at the business level in fiscal year 'twenty five we expect the newly combined express ground and services segment now.

Speaker Change: Now called Federal express to be the larger driver of FY 'twenty five adjusted income and margin improvement.

Speaker Change: And we expect Fedex freight margins to be up modestly year over year.

Speaker Change: Due to both yield and volume growth.

Speaker Change: I'd also like to provide some color on our quarterly cadence in light of the U S. Postal service contract expiration at the end of September.

John W. Dietrich: We anticipate headwinds from the expiration of that contract to begin in the second quarter, starting in October, with this headwind lessening in the second half as we aggressively reduce our coastal service-related costs, including our U.S. Domestic Air Network. Turning to other aspects of our outlook, our estimated effective tax rate for the full year is approximately 24.5%, prior to the mark-to-market retirement plan adjustment.

Brie Carere: We anticipate headwinds from the expiration of that contract to begin in the second quarter, starting in October. With this headwind lessening in the second half as we aggressively reduced our postal service-related costs, including our US domestic air network cost. Turning to other aspects of our outlook, our estimated effective tax rate for the full year is approximately 24.5% prior to mark-to-market retirement plan adjustments. We're also forecasting $560 million of business optimization costs in FY25 associated with our transformation. Our operating income bridge shows the operating profit elements embedded in our full-year outlook. My way of illustration, we're using adjusted operating profit of $7.2 billion.

Speaker Change: We anticipate headwinds from the expiration of that contract to begin in the second quarter starting in October.

Speaker Change: With this headwind lessening in the second half as we aggressively reduced our coastal service related costs.

Speaker Change: Including our U S domestic air network costs.

Speaker Change: Turning to other aspects of our outlook.

Speaker Change: Our estimated effective tax rate for the full year is approximately 24, 5%.

Speaker Change: Prior to Mark to market retirement plan adjustments.

John W. Dietrich: We're also forecasting $560 million of business optimization costs in FY25 associated with our transformation. Our operating income bridge shows the operating profit elements embedded in our full-year outlook. For example, we're using an adjusted operating profit of $7.2 billion, equivalent to $21 of adjusted EPS. The midpoint of our Outlook range. To get to $7.2 billion of adjusted operating profits, we're now assuming revenue net of variable costs and continued inflationary pressures is up $100 million. U.S.

Speaker Change: We're also forecasting $560 million of business optimization costs in FY 'twenty five associated.

Speaker Change: Associated with our transformation.

Speaker Change: Our operating income bridge shows the operating profit elements embedded in our full year outlook.

Speaker Change: By way of illustration, we're using adjusted operating profit of $7 2 billion.

Brie Carere: Equivalent to $21 of adjusted EPS, the midpoint of our outlook range. To get to $7.2 billion of adjusted operating profit, we're now assuming revenue net of variable cost and continued inflationary pressures. Is up $100 million. US Postal Service contract termination results in a $500 million headwind. International export yield pressure of $400 million as demand surcharge is diminished and next continues shifting toward our deferred services. And two fewer operating days in the year decreases profitability by $300 million. And as a side note, we've not experienced this adverse counter dynamics since Fiscal Year 2001. And lastly, performance-based variable compensation increases by $100 million.

Equivalent to $21 of adjusted EPS, the midpoint of our outlook range.

Speaker Change: To get to $7 2 billion of adjusted operating profit. We're now assuming revenue net of variable costs and continued inflationary pressures is up $100 million.

John W. Dietrich: Postal Service contract termination results in a $500 million headwind, international export yield pressure of $400 million as demand surcharges diminish and mix continues shifting toward our deferred services, and two fewer operating days in the year decreases profitability by $300 million. And as a side note, we've not experienced this adverse calendar dynamic since fiscal year 2001.

Speaker Change: U S postal service contract termination resulted in a $500 million headwind.

Speaker Change: International export yield pressure of $400 million.

Speaker Change: As demand surcharges diminish and mix continues shifting toward our deferred services.

Speaker Change: And two fewer operating days in the year decreases profitability by $300 million.

Speaker Change: And as a side note we have not experienced this adverse calendar dynamics since fiscal year 2001.

John W. Dietrich: And lastly, performance-based variable compensation increases by $100 million. Drive, however, will more than offset these pressures, delivering an incremental $2.2 billion in structural cost savings. As a result of all of these factors and at the midpoint, we would expect Fiscal Year 2025 Adjusted Operating Income to increase by approximately 15% year-over-year. In FY24, we remained focused on reducing our capital intensity, increasing ROIC, and continuing to provide increased stockholder returns, all while maintaining a strong balance sheet. Capital expenditures for the quarter were $1.2 billion, bringing year-to-date CapEx to $5.2 billion, which is a decline of nearly a billion dollars compared to last year.

Speaker Change: And lastly performance based variable compensation increases by $100 million.

Brie Carere: Drive, however, will more than offset these pressures, delivering an incremental $2.2 billion in structural cost dating. As a result of quality factors, and at the mid-point, we would expect, just a year 2025, adjusted operating income to increase by approximately 15% year over year. In FY24, we remained focused on reducing our capital intensity, increasing ROIC, and continuing to provide increased stockholder returns, all while maintaining a strong balance sheet. Capital expenditures for the quarter were $1.2 billion, bringing year-to-date capex to $5.2 billion, which is a decline of nearly a billion dollars compared to last year. We delivered ROIC of 9.9%, which is an increase of 120 basis points from last year's 8.7%.

Speaker Change: Drive however were more than offset these pressures delivering an incremental $2 2 billion and structural cost savings.

Speaker Change: As a result of all of these factors and at the midpoint, we would expect fiscal year 2025, adjusted operating income to increase by approximately 15% year over year.

Speaker Change: In FY 'twenty four we remain focused on reducing our capital intensity, increasing ROIC and continuing to provide increased stockholder returns all while maintaining a strong balance sheet.

Speaker Change: Capital expenditures for the quarter were $1 2 billion.

Speaker Change: Bringing year to date Capex to $5 2 billion, which is a decline of nearly $1 billion compared to last year.

John W. Dietrich: We delivered ROIC of 9.9%, which is an increase of 120 basis points from last year's 8.7%. We will continue to focus on improving ROIC, and it is now a significant element of our long-term incentive program. Consistent with our goal of increasing stockholder returns, we completed $500 million of accelerated share repurchases in the fourth quarter, bringing our total share repurchases for the fiscal year to $2.5 billion. This is $500 million above the plan that we came into the year with. For the full year, we also generated $4.1 billion in adjusted free cash flow, which is up about $500 million year over year.

Speaker Change: We delivered ROIC of nine 9%.

Speaker Change: It is an increase of 120 basis points from last year's eight 7%.

Brie Carere: And we'll continue to focus on improving ROIC, and it is now a significant element of our long-term incentive program. This isn't with our goal of increasing stockholder returns. We completed $500 million of accelerated cherry purchases in the fourth quarter, bringing our total cherry purchases for the fiscal year to $2.5 billion dollars. This is $500 million above our plan that we came into the year, where the full year, we also generated $4.1 billion in adjusted free cash flow, which is up $500 million year over year. Looking ahead to FY25, we anticipate capital spend of $5.2 billion, which will again be down year over year as a percentage of revenue.

Speaker Change: And we'll continue to focus on improving ROIC and it is now a significant element of our long term incentive program.

Consistent with our goal of increasing stockholder returns, we completed $500 million of accelerated share repurchases in the fourth quarter brings.

Bringing our total share repurchases for the fiscal year to $2 5 billion.

Speaker Change: This is $500 million above our plan that we came into the year with it.

Speaker Change: For the full year, we also generated $4 1 billion and adjusted free cash flow, which is up about $500 million year over year.

John W. Dietrich: Looking ahead to FY25, we anticipate capital spend of $5.2 billion, which will again be down year over year as a percentage of revenue, and we'll work by prioritizing our capital toward optimizing our network as part of Network 2.0, further enhancing our fleet and automation to improve operating efficiency, and we remain committed to decreasing aircraft capex to approximately $1 billion in FY 26. Due to improved earnings and CapEx discipline, we expect to further grow adjusted free cash flow. This will enable us to deploy $2.5 billion in stock repurchases in FY25, including a planned $1 billion of repurchases in Q1.

Speaker Change: Looking ahead to FY 'twenty, five we anticipate capital spend of $5 2 billion.

Speaker Change: Which will again be down year over year as a percentage of revenue.

Brie Carere: And we'll work by prioritizing our capital toward optimizing our network as part of Network 2.0. Further enhancing our fleet and automation to improve operating efficiency. And we remain committed to decreasing aircraft CapEx to approximately $1 billion in FY26. Due to improved earnings in CapEx discipline, we expect a further grow adjusted free cash flow. This will enable us to deploy $2.5 billion in stock purchases in FY25, including a planned $1 billion of purchases in Q1. As previously announced, we're also enhancing our stockholder returns by increasing our dividend by 10%. And this is on top of the 10% increase we implemented in FY24.

Speaker Change: And we will work by prioritizing our capital toward optimizing our network as part of network <unk> and <unk>.

Further enhancing our fleet and automation to improve operating efficiency.

Speaker Change: And we remain committed to decreasing aircraft capex to approximately $1 billion in FY 'twenty six.

Speaker Change: Due to improved earnings and Capex discipline, we expect to further grow adjusted free cash flow.

Speaker Change: This will enable us to deploy $2 $5 billion in stock repurchases in FY 'twenty, five including a planned $1 billion of repurchases in Q1.

John W. Dietrich: As previously announced, we're also enhancing our stockholder returns by increasing our dividend by 10%. This is on top of the 10% increase we implemented in FY24. Lastly, we're planning for $800 million of voluntary pension contributions to our U.S. qualified plans, and these plans continue to be well funded, and we're at the 98.6% funding level at fiscal year end.

As previously announced we're also enhancing our stockholder returns by increasing our dividend by 10%.

Speaker Change: And this is on top of the 10% increase we implemented in FY 'twenty four.

Brie Carere: Lastly, we're planning for $800 million of voluntary pension contributions to our U.S. qualified Plans. And these plans continue to be well funded, and we're at the 98.6% funding level at fiscal year end.

Speaker Change: Lastly, we're planning for $800 million of voluntary pension contributions to our U S qualified plans and these plans continue to be well funded and we're at the 98, 6% funding level at fiscal year end.

Brie Carere: Finally, a quick update on our segment reporting changes. Now that we have successfully completed the consolidation of Express, Round and services into Federal Express Corporation, please to announce that our reportable segments in FY25 will be Federal Express and FedEx Freight with no changes to corporate and other. FedEx Freight will include FedEx Custom Critical, which was previously included in FedEx Express. We're making this change to freight due to the business synergies between Custom Critical and freight. Our new segment structure reflects our commitment to operating a fully integrated air and ground express network. And let me be clear, notwithstanding the consolidation of expressing ground, optimizing our express services and associated costs, including the cost of our global air network, remains critical to our profit and return objectives.

John W. Dietrich: Finally, a quick update on our segment reporting changes. Now that we have successfully completed the consolidation of express, ground, and services into Federal Express Corporation, I'm pleased to announce that our reportable segments in FY25 will be FedEx Express and FedEx Freight with no changes to corporate and other. FedEx Freight will include FedEx Custom Critical, which was previously included in FedEx Express.

Speaker Change: Finally, a quick update on our segment reporting changes.

Now that we have successfully completed the consolidation of express ground and services into Federal Express Corporation.

Speaker Change: Pleased to announce that our reportable segments in FY 'twenty five we'll be federal express and Fedex freight with no changes to corporate and other.

Speaker Change: Fedex freight will include Fedex custom critical which was previously included in Fedex Express, we're making this change to freight due to the business synergies between custom critical and freight.

John W. Dietrich: We're making this change to freight due to the business synergies between Custom Critical and freight. Our new segment structure reflects our commitment to operating a fully integrated air and ground express network. And let me be clear, notwithstanding the consolidation of express and ground, optimizing our express services and associated costs, including the cost of our global air network, remains critical to our profit and return objectives. This consolidated structure will support OneFedEx and Network 2.0 objectives and will provide a more flexible, efficient, and intelligent network, as OneFedEx will continue to provide service level volume and yield detail. We plan to share a revised statistical book in late August, which will include our recast results for FY23 and FY24.

Speaker Change: Our new segment structure reflects our commitment to operating a fully integrated air and ground Express network.

Speaker Change: And let me be clear notwithstanding the consolidation of express and ground optimizing our express services and associated costs.

Speaker Change: <unk> the cost of our global Air Network remains critical to our profit and return objectives.

Brie Carere: This consolidated structure will support one FedEx and Network 2.0 objectives, and will provide a more flexible, efficient, and intelligent network as one FedEx. We'll continue to provide service level volume and yield detail, and we plan to share a revised statistical book in late August, which will include our recast results for FY23 and FY24. Overall, I want to acknowledge and thank the entire team for their efforts in delivering these strong FY24 results and improving profitability, despite a very challenging demand environment. I'm also really inspired by their commitment to achieving even stronger results in FY25 and beyond, as we continue to deliver on the Purple Promise.

Speaker Change: This consolidated structure will support one Fedex and network <unk> objectives, and will provide a more flexible efficient and intelligent network as one Fedex.

Speaker Change: We will continue to provide service level volume and yield detail and we plan to share our revised statistical book in late August which will include our recast results for FY2023 in FY 'twenty four.

John W. Dietrich: Overall, I want to acknowledge and thank the entire team for their efforts in delivering these strong FY24 results and improving profitability despite a very challenging demand environment. I'm also really inspired by their commitment to achieving even stronger results in FY25 and beyond as we continue to deliver on the Purple Promise. With that, let's open it up for questions, and we will now begin the question and answer session. To ask a question, you may press star and then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the key.

Overall, I want to acknowledge and thank the entire team for their efforts in delivering these strong FY 'twenty for results and improving profitability, despite a very challenging demand environment.

Speaker Change: I'm also really inspired by their commitment to achieving even stronger results in FY 'twenty five and beyond as we continue to deliver on the purple promise.

Unknown Attendee: With that, let's open it up for questions. And we will now begin the question-and-answer session. To ask a question, you may press star, then one on your touch tone phone. If you're using a speaker phone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. Please limit yourself to one question. And at this time, we'll pause them entirely to assemble our roster.

Speaker Change: With that let's open it up for questions.

Speaker Change: And we will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone.

Speaker Change: If youre using a speakerphone please pick up your handset before pressing the keys to withdraw your question. Please press Star then two please limit yourself to one question and at this time, we will pause momentarily to assemble our roster.

Daniel Robert Imbro: And our first question today will come from Daniel in Brett, with Steven think. Please go ahead. Hey, good afternoon, everybody. Thanks. Thank you for the question. Maybe, I want to ask on the express side. So some margins obviously came in to six for the year. I think obviously it's been a volatile, but with the cost progress in Europe, the USPS contract shift, and then just other moving factors in the core business. Can you talk about how you expect those margins to trend both in the near term and then as we move through fiscal 25. I'd rather give a little bit of color, I think, on some of the USPS headwind and timing, but any more detail there and quantify that would be helpful.

Operator: To withdraw your question, please press star then two. Please limit yourself to one question. And at this time, we'll pause momentarily to assemble our roster. And our first question today will come from Daniel Embro with Stevens Inc. Please go ahead. Hey, good afternoon, everybody.

Daniel <unk>: And our first question today will come from Daniel <unk> with Stephens, Inc. Please go ahead.

Daniel Robert Imbro: Thanks for taking the question. Maybe, as on the express side, some margins obviously came in at 2.6 for the year. I think obviously it's been volatile, but with the cost progress in Europe, the USPS contract shift, and then just other moving factors in the core business, can you talk about how you expect those margins to trend both in the near term and then as we move through fiscal 25? Raj, you gave a little bit of color, I think, on some of the USPS headwinds and timing, but any more detail there and quantifying that would be helpful.

Hey, good afternoon, everybody. Thanks, taking the question.

Speaker Change: Maybe.

Speaker Change: Express side since the margins obviously came in at $2 six for the year I think obviously, it's been a volatile but with the cost progress in Europe. The USPS contract shift and then just the other moving factors in the core business can you talk about how you expect those margins to trend both in the near term and then as we move through fiscal 'twenty. Five raws you gave a little bit of color I think on some of the USPS headwinds and <unk>.

Speaker Change: But any more detail there and quantifying that would be helpful. Thanks.

Rajesh Subramaniam: Thanks. Yeah, thank you, Daniel, for that question. Let me start, and then John can fill in on some of the details here too. Firstly, we are sequentially improving our performance in our express services. It remains a top priority for me and the entire team. And we're taking multiple actions here. Firstly, we are lining capacity with demand. As we already heard, we moved 3,531 aircraft more gently in 2004. As I've mentioned to you in some detail last time we spoke, I talked to you about tricolor. That's the fundamental restructuring of our network. It does two things.

Rajesh Subramaniam: Thanks. Yeah, thank you, Daniel, for that question. Let me start and then John can fill in on some of the other details here too. Firstly, we are sequentially improving our performance in our express services. It remains a top priority for me and the entire team, and we're taking multiple actions here. Firstly, we're aligning capacity with demand. As we have already heard, we moved 31 aircraft from our jet fleet in Q4. As I mentioned to you in some detail last time we spoke, I talked to you about Tricolor, which is a fundamental restructuring of our network. It does do two things.

Speaker Change: Yes. Thank you Daniel for that question, let me start and then Jon can fill in on some of the details here two.

Firstly, we are sequencing improving our performance in our express services.

Speaker Change: It remains a top priority for me and the entire team and we're taking multiple actions here firstly.

Speaker Change: Aligning capacity with demand so we already heard.

Speaker Change: <unk> 30, 31 aircraft more jet fleet.

Speaker Change: Q4.

Speaker Change: As I have mentioned to you in some detail last time, we spoke I talk to you about Tri color. That's a fundamental restructuring of our network. It does two things one it improves our density improves our asset utilization and expense margins and secondly, because of reduction of cost to serve it puts us in a <unk>.

Rajesh Subramaniam: One, it improves our density, improves our asset utilization, and expands margins. And secondly, because of the reduction in costs to serve, it puts us in a position to profitably take share in the premium freight segment. Next, as I mentioned in my remarks, we will improve our European performance. We have, you know, our drive commitment is to improve $600 million for FY23 baseline, and that's a critical part of how our expo services get better in FY25. And finally, we are making active efforts to make sure that our global SG&A is streamlined.

John Dietrich: One, it improves our density; it improves our acid utilization and expands margins. And secondly, because of the reduction of costs to serve, it puts us in a position to profitably take share in the premium trade segment. Next, as I mentioned in our remarks, we will improve our European performance. We have, you know, our drive commitment is to improve 600 million dollars for a fight 23 baseline, and that's a critical part of our express services get better on a fight 25. And finally, we are taking active efforts to make sure that our global S-GNA is streamlined.

Speaker Change: Positioned to profitably take share in the premium freight segment.

Speaker Change: Next.

Speaker Change: As I mentioned in my remarks, we will improve our European performance we have.

Speaker Change: Our drive commitment assumed <unk> $601 million or FY, 'twenty, three baseline and Thats a critical part of our extra services get better on FY 'twenty five.

And then finally.

John W. Dietrich: We are taking active efforts to make sure that our global SG&A as streamline we are extremely confident that we can continue to unlock significant value in our extra services business now, let me turn it over to John to add more detail. Thanks.

John Dietrich: We are extremely confident that we can continue to unlock significant value in our express services business. And now let me turn it over to John Badmone detail. Yeah, no, thanks, Raj. And I think you covered it very well. We are pleased to see this sequential improvement in our margins, but recognize we have more to go. I will also add, you know, there is a significant sense of urgency as well. Drive is heavily focused on the express business. And as Rajesh mentioned, this is going to be a key part of our margin expansion as we go forward here, and we'll look forward to updating you along the way.

John W. Dietrich: We are extremely confident that we can continue to unlock significant value in our expo services business. Now, let me turn it over to John to add more detail.

Rajesh Subramaniam: And I think you covered it very well. We were pleased to see the sequential improvement in our margins but recognize we have more to go. I will also add that there is a significant sense of urgency as well, because Drive is heavily focused on the express business.

John W. Dietrich: Thanks, Raj and I think you covered it very well we were pleased to see the sequential improvement in our margins, but recognize we have more to go I will also add there is a significant sense of urgency as well drive is heavily focused on the express business.

John W. Dietrich: And as Raj mentioned, this is going to be a key part of our margin expansion as we go forward here, and we'll look forward to updating you along the way. And our next question will come from Scott Group with Wolf Research. Please go ahead. Hey, thanks.

Speaker Change: And as Raj mentioned this is going to be a key part of our margin expansion as we go forward here and we look forward to updating you along the way.

Speaker Change: Yes.

Scott Group: In our next question, we'll come from Scott Group with Wolf Research. Please go ahead. Hey, thanks Afternoon. So, in the bridge, the $500 million postal headwind for the year, how much of that is in Q2, and what do you think that should mean for sort of like the quarterly earnings cadence? And I guess ultimately, how much of the revenue decline with the post office do you think you can fully offset over the next few quarters?

Speaker Change: And our next question will come from Scott Group with Wolfe Research. Please go ahead.

Scott H. Group: So in the bridge, the $500 million postal headwind for the year, how much of that is in Q2? And what do you think that should mean for sort of like the quarterly earnings cadence? And I guess ultimately, you know, how much of the revenue decline with the post office do you think you can fully offset, you know, over the next few quarters? And then, if I may, just a separate topic, Rajesh, can you just talk about the puts and takes of why you would or wouldn't go ahead with the LTL spin? Thanks.

Scott H. Group: Hey, Thanks afternoon. So.

Scott H. Group: In the bridge the $500 million postal headwind for the year, how much of that is in Q2.

Scott H. Group: What do you think that should mean for sort of like the quarterly earnings cadence and I guess ultimately how much of the revenue decline with the post office do you think you can fully offset over the next few quarters and then if I. If I may just a separate topic was just can you just talk about like the puts and takes.

Scott H. Group: And then if I, if I may, just a separate topic, Rajesh, can you just talk about like the puts and takes of why you would or wouldn't go ahead with the, with an LTL spin? Thank you. So, so thanks, Scott, and I'll start with regard to the $500 million. We haven't laid out the spread of where it's going to impact us the most, but we can say we've got a pretty good hold on what those costs are. We're going to be aggressively going after them, beginning in Q2, and it's going to flow into Q3, and those aggressive mitigation efforts should start to really take hold in Q3 and beyond.

Speaker Change: So why you would or wouldn't go ahead with the with an LPL spin.

Speaker Change: Thank you.

John W. Dietrich: So thanks, Scott. And I'll start with regard to the $500 million. We haven't laid out the spread of where it's going to impact us the most.

Speaker Change: So so thanks, Scott and I will start with.

Speaker Change: With regard to the $500 million, we haven't laid out.

Speaker Change: No spread of where it's going to impact us the most what we what we can say is we've got a pretty good hold on what those costs are going to be aggressively going after them beginning in Q2, and it's going to flow into Q3, and those aggressive mitigation efforts should start to really take hold in Q3 and beyond.

John W. Dietrich: What we can say is we've got a pretty good hold on what those costs are. We're going to be aggressively going after them, beginning in Q2, and it's going to flow into Q3. And those aggressive mitigation efforts should start to really take hold, and I look forward to keeping you posted on that. And Raj, I'll turn it over to you on the other questions.

Rajesh Subramaniam: And look forward to keeping you posted on that, and Rajesh, I'll turn it over to you on the other question. Yeah, Scott, at this point all I'm going to say is that the assessment of FedEx trading the company's portfolio structure is well underway. We'll do this analysis thoroughly, deliberately, and when we have something to communicate on this, we'll of course do so. Thank you, Scott.

Speaker Change: And look forward to keeping you posted on that and Raj I'll turn it over to you on the other question.

Rajesh Subramaniam: Yeah, Scott, at this point, all I'm going to say is that the assessment of FedEx freight in the company's portfolio structure is well underway. We'll do this analysis thoroughly, deliberately, and when we have something to communicate on this, we'll, of course, do so. I'm sorry, I guess I didn't touch your revenue question on that part.

Speaker Change: Yes, Scott.

Speaker Change: Pointing all im going to say is that the assessment at Fedex freight in the Companys portfolio structure is well underway.

Speaker Change: We will do this analysis thoroughly deliberately and when we have something to communicate on this will of course do so thank.

Scott H. Group: Thank you Scott.

Brie Carere: I'm sorry, I guess I, I didn't touch your revenue question on that part, and as you can see from our outlook, we are looking to year over year improve our revenue. So that's part of our plan as well as we go forward.

I am sorry, I guess I didn't touch your revenue question on that part and as you can see from our outlook. We are looking to two year over year improve our revenue. So that's part of our plan as well as we go forward.

John W. Dietrich: And as you can see from our outlook, we are looking to improve our revenue year over year. So that's part of our plan as well as we go forward. And our next question will come from Chris Wetherbee with Wells Fargo. Please go ahead.

Chris Weatherby: And our next question will come from Chris Weatherby with Wells Fargo. Please go ahead. Hey, thanks. Maybe kind of just to follow up again on the LPL piece, where I just want to get a sense.

Speaker Change: And our next question will come from Chris Wetherbee with Wells Fargo. Please go ahead.

Christian F. Wetherbee: Hey, thanks. Maybe kind of just to follow up again, on the LTL piece, Raj, just want to get a sense, does this include a spin or sale of the assets? Just want to make sure we understand that all opportunities or potential are on the table. And then, I guess, John, maybe you're thinking about that kind of revenue cadence. How do you think that sort of plays?

Christian F. Wetherbee: Hey, Thanks, maybe just a follow up again on the <unk> piece Raj just wanted to get a sense does this include a spin or sale of the assets and want to make sure. We understand all opportunities potential is on the table and then I guess, John maybe youre thinking about that kind of revenue cadence I guess.

Rajesh Subramaniam: Does this include a spin or sale of the artists? Want to make sure we understand that all opportunities are potential is on the table. And then I guess John, maybe you're thinking about that kind of revenue cadence, I guess. How do you think that sort of plays? I guess that's the piece I'm looking at. It's the first step in the bridge on the revenue side. How that sort of plays out, obviously, you have the big dip in revenue relative to USPS starting in two two. Just want to get a sense of kind of how to make about that over the course of the year.

Speaker Change: I think that sort of plays I guess, that's the piece I'm looking at is the first step in the bridge on the revenue side, how that sort of plays out obviously you have the big dip in revenue relative to USPS starting in <unk> just wanted to get a sense of kind of how to think about that over the course of the year.

Rajesh Subramaniam: I guess that's the piece I'm looking at is the first step on the revenue side, how that sort of plays out. Obviously, you have the big dip in revenue relative to USPS starting in 2Q. Just want to get a sense of kind of how to think about that over the course of the year. Okay, let me start and then give it to John.

Rajesh Subramaniam: Okay, let me start and then give it to John. Honestly, at this point, I'm not going to say much more on this topic than what I've already said. As I said, we are looking at the FedEx plate in the company's portfolio structure, and we'll do the analysis. And we'll come back to you when we have something to say.

Speaker Change: Okay, Let me start.

John W. Dietrich: Honestly, at this point, I'm not going to say much more on this topic than what I've already said. As I said, we are looking at the FedEx trade in the company's portfolio structure, and we'll do the analysis, and we'll come back to you when we have something to say. And so I'll touch on the cadence. Well, we're not going to give quarterly guidance by segment, but for your modeling purposes, we're anticipating normal seasonal trends to hold steady in FY25 Q1.

Then give it to John honestly at this point I'm not going to say much more on this topic than what I've already said.

Speaker Change: As I said, we are looking at Fedex freight in the company's portfolio structure, and we will do the analysis and we'll come back to you when we have something to say.

John W. Dietrich: And so I'll touch on other cadence. Well, we're not going to give quarterly guidance. By segment, but for your modeling purposes, we're anticipating normal seasonal trends to hold steady in FY25 Q1. I will note that Q2 will be impacted by a couple of events, including the impact of the US Postal Service contract termination. As well as five or Monday moves from Q3 last year to Q2 of this year. And we'll look forward to keeping you. I'm sorry, the other way around from Q3 to Q3. Andrew, Q2 to Q3, I'm sorry.

Speaker Change: And so I'll touch on the cadence will we're not going to give quarterly guidance.

By segment, but for your modeling purposes, we are anticipating normal seasonal trends to hold steady.

Speaker Change: FY 'twenty five Q1, I will note that Q2 will be impacted by a couple of events, including this.

John W. Dietrich: I will note that Q2 will be impacted by a couple of events, including the impact of the U.S. Postal Service contract termination, as well as Cyber Monday moving from Q3 of last year to Q2 of this year.

Speaker Change: The impact of the U S postal service contract termination.

Speaker Change: As well as cyber Monday moves from Q3.

Speaker Change: Last year to Q2 of this year and we will look forward to keeping you I'm sorry, the other way around from Q3 to Q to.

Conor Cunningham: And we'll look forward to keeping you, I'm sorry, the other way around, from Q3 to Q2. Q2 to Q3, I'm sorry. And our next question will come from Conor Cunningham from Mellius Research. Please go ahead.

Speaker Change: Q2 to Q3 I'm sorry.

Conor Cunningham: And our next question will come from Conor Cunningham from Melius Research. Please go ahead. Hi, everyone. Thank you.

Speaker Change: And our next question will come from Conor Cunningham from Melius Research. Please go ahead.

Brie Carere: Hi everyone, thank you. Just in the context of your revenue assumptions, just curious if you could frame up some of the moving parts, maybe on when you expect volumes to inflect positively, and then just any of the, this doesn't seem like a macro-driven plan, but just any of your assumptions around the macro environment, what you need to see there to kind of see volumes perk up. Thank you.

Conor Cunningham: Hi, everyone. Thank you just in the context of your revenue assumptions just curious if you could frame up some of the moving parts maybe on when you expect.

Conor Cunningham: Just in the context of your revenue assumptions, just curious if you could frame up some of the moving parts just maybe on when you expect, you know, volumes to reflect positive and then just any of the, this doesn't seem like a macro driven plan, but just any of your assumptions around the macro environment, what you need to see there to kind of see volumes. Thank you. Sure. Thanks, Conor. It's free. From a macro perspective, we are expecting sort of moderate improvement as we work our way through this fiscal year. As we look at kind of the sub segments of our business from a B2B perspective, we are forecasting the overall B2B market to be around 2% growth.

<unk> flat to positive and then just any of the this doesn't seem like a macro driven plan, but just any of your assumptions around the macro environment. What you need to see that I think to kind of see volumes pick up. Thank you.

Speaker Change: Sure. Thanks, Conor three.

Speaker Change: From a macro perspective, we are expecting moderate improvement as we work our way through this fiscal year as we look at kind of the sub segments of our business from a <unk> perspective, we are forecasting the overall <unk> market to be around 2% growth E. Commerce will be ahead of that as we've just said.

Rajesh Subramaniam: As we look at some of the subsegments of our business from a B2B perspective, we are forecasting the overall B2B market to be around 2% growing. And from an air cargo perspective, we are looking at the growth in the market to be around 4%. So, as we work through the year, we do expect there to be modest improvement. We are forecasting that we will have to take some small market share in our profitable target segment, and we feel really good about the plan as we move forward through the year.

Brie Carere: E commerce will be ahead of that. If you've just seen, you know, e commerce reset is somewhat done when we just looked at e commerce. E commerce is a percentage of retail and in calendar year Q1. We actually were up 1% year over year. So we do like the fundamentals from an e-commerce perspective that will help us here in the United States and around the world. And then, from an air cargo perspective, we are looking at the growth of the market around 4%. So as we work through the year, we do expect there to be, you know, modest improvement.

Speaker Change: <unk> E Commerce reset is somewhat Dan when we just looked at e-commerce as a percentage of retail in calendar year Q1, we.

Speaker Change: We actually were up 1% year over year. So we do like the fundamentals from an E. Commerce perspective that will help us here in the United States and around the World and then from an air cargo perspective, we are looking at the growth in the market around 4%. So as we work through the year, we do expect there to be modest improvement we are forecast.

Brie Carere: We are forecasting that we will have to take some small market share in our profitable target segment. And, you know, we feel really good about the plan and move forward through the year.

Speaker Change: Seeing that we will have to take them.

Speaker Change: Small market share in our profitable target segments.

Speaker Change: And we feel really good about the plan is to move forward through the year.

Brie Carere: I'll just add one more point here, and just to make sure, we will obviously monitor the demand very, very carefully, and we'll make adjustments as needed.

Rajesh Subramaniam: I'll just add one more point here just to make sure we will obviously monitor this demand very, very carefully, and we'll make adjustments as needed. Please find out about our tremendous execution in fiscal year 24, where we drove significant bottom-line growth despite the lack of any revenue growth. And our next question will come from Ken Hoexter with Bank of America. Please go ahead. Great, thank you. Good afternoon.

Speaker Change: I'll just add one more point here and just to make sure. We will obviously monitor the demand very very carefully and we'll make adjustments as needed.

Rajesh Subramaniam: We'll just point out on our tremendous execution in fiscal year 24, where we drove significant bottom line growth despite lack of any revenue growth.

Speaker Change: As pointed out on our tremendous execution in fiscal year, 'twenty, four where we drove significant bottom line growth. Despite.

Speaker Change: The lack of any revenue growth.

Ken Hoexter: And our next question will come from Ken Hoaster with Bank of America. Please go ahead. Great. Thank you. Good afternoon. So Raj, lots of digest here, and thanks for all the detail.

Speaker Change: And our next question will come from Ken <unk> with Bank of America. Please go ahead.

Ken Hoexter: So Raj, lots to digest here. And thanks for all the detail. Maybe just thoughts on the integration of the networks, your early take on how that's proceeding. And I don't know if it's for you or John or Brie, but your 2022 dollar range, maybe thoughts on what's the upside and downside within that range from the midpoint? Thank you.

Thank you and good afternoon.

Speaker Change: So raj lot to digest here and thanks for all the detail maybe just thoughts on the integration of the networks. Your early take on how that's proceeding and I don't know if it's for you or John or Brie, but $2022 range, maybe thoughts on what's the upside downside within that range from the mid point.

Rajesh Subramaniam: Maybe just thoughts on the integration of the networks, your early take on how that's proceeding. And I don't know if it's for you or John or Bri, but you 20, $22 range maybe thoughts on what's the upside downside within that range from the midpoint. Thanks. Thank you.

Rajesh Subramaniam: Let me start and then John can weigh in on this. Again, I appreciate the question. We are very pleased, firstly, with the execution and transition to OneFedX, which delivers multiple benefits. Firstly, it's more efficient in, you know, reducing overlapping costs.

Rajesh Subramaniam: Let me start, and then John can weigh in on this again. I appreciate the question. We are very pleased firstly with the execution and transition to one FedEx, which, you know, delivers multiple benefits. Firstly, it's more efficient in the, you know, reducing overlapping costs. But more importantly, it's much more effective. And, you know, we are an organization and makes it also easier for our team members to manage the career as much better. On the network 2.0, we continue to make significant progress in this regard in, you know, it's, you know, one of the biggest markets.

Speaker Change: Thank you let me start and then John can weigh in on this.

Speaker Change: Again I appreciate the question.

Speaker Change: We're very pleased especially with the execution and transition to one Fedex.

Speaker Change: All of us multiple benefits firstly, it's more efficient.

Speaker Change: But reducing overlapping costs, but more importantly is much more effective.

John W. Dietrich: But more importantly, it's much more effective, and you know we are an organization that makes it also easier for our team members to manage their careers much better. On Network 2.0, we continue to make significant progress in this regard. It's, you know, one of the biggest markets, obviously, Canada, and in the first half of fiscal year 25, we'll complete the Canada transition, and then we expect to significantly pick up the pace into FY26. Yeah, thanks, Raj. And hey, Ken.

And.

Speaker Change: We are.

Speaker Change: The organization and make.

Speaker Change: It makes it also easier for our team members to manage that Korea is much better on the network to auto we continued to make significant progress in this regard.

Speaker Change: What are the biggest markets obviously, the one was Canada.

John Dietrich: Obviously, the one is Canada. And in first half, officially at 25 will complete the Canada transition. And then we expect to significantly pick up the pace into FY26.

Speaker Change: And in first half of fiscal year 'twenty five we'll complete the Canada transition.

And then we expect to significantly pick up the pace into FY 'twenty six.

John Dietrich: Yeah, thanks, Roger. And hey, can look on the guidance. As always, we continue to take a very thoughtful and methodical approach. And there are a number of factors we've taken into account. And as Bri mentioned, we expect a modest improvement in the demand environment and FY25. and supporting our revenue outlook of a low-to-mid single-digit percentage increase, as we noted. And that'll be driven by improving trends at US domestic parcel and international export. And while headwinds remain, and we align those out in our bridge, we continue to focus on aligning our cost across the enterprise with expected volume and are focused on executing on revenue quality strategy.

John W. Dietrich: Look, on guidance, as always, we continue to take a very thoughtful and methodical approach, and there are a number of factors we've taken into account. And as Brie mentioned, we expect a modest improvement in the demand environment in FY 25, supporting our revenue outlook of a low-to-mid single-digit percentage increase, as we noted, and that'll be driven by improving trends at U.S. domestic parcel and international export. And while headwinds remain, and we have lined those out in our bridge, you know, we continue to focus on aligning our costs across the enterprise with expected volume and are focused on executing on our revenue quality strategy. We're going to be focused on driving.

Speaker Change: <unk>.

Speaker Change: Yes, Thanks, Raj and Hakan.

Speaker Change: Look on the guidance.

Speaker Change: As always we continue to take a very thoughtful and methodical approach.

Speaker Change: And there are a number of factors we've taken into account and as <unk> mentioned, we expect a modest improvement in the demand environment in FY 'twenty five.

Speaker Change: Supporting our revenue outlook of the low to mid single digit percentage increase as we noted.

Speaker Change: And that'll be driven by improving trends in U S domestic parcel and international export and while headwinds remain in line those out in our in our bridge, we continue to focus on aligning our cost across the enterprise.

Speaker Change: With expected volume.

Speaker Change: And are focused on executing on revenue quality strategy.

Brie Carere: You know, we're going to be focused on drive.

Brandon Oglenski: I would direct your attention to the right side of that slide, the $2.2 billion focused on driving and controlling those things within our control. And that's going to be critical for us to deliver on this guidance. And our next question will come from Brandon Oglenski with Barclays. Please go ahead. Hi, good afternoon.

Speaker Change: We're going to be focused on drive I would direct your attention to the right side of that slide the $2 2 billion are focused on driving controlling those things within our control and that's going to be critical for us to deliver on this guidance.

Brie Carere: I would direct your attention to the right side of that slide, the 2.2 billion, focused on drive and controlling those things within our control. And that's going to be critical for us to deliver on this guidance.

Brandon Oglenski: At our next question, we'll come from Brandon Oglenski with Barclays. Please go ahead. Hi, good afternoon.

Speaker Change: And our next question will come from Brandon <unk> with Barclays. Please go ahead.

Rajesh Subramaniam: And maybe if I can just follow up from Ken's question there, Raj, on Network 2.0 and the integration, I think investors are pretty excited about this, but also concerned that there could be network disruption. I mean, if we've just looked across 20 or 30 years of transportation network integration, it always hasn't gone all that well. We can look, you know, no further than T&T.

Speaker Change: Hi, good afternoon, and maybe if I can just follow up from Ken's question, There Raj network to point out when the integration I think investors are pretty excited about this but also concerned that there could be network disruption. If we've just slipped across 20 or 30 years of transportation network integration that always hasnt gone all that well we can look.

Brandon Oglenski: And maybe if I can just follow up from Ken's question there, Raj, on Network 2.0 in the integration. I think investors are pretty excited about this, but also concerned that there could be network disruption. I mean, if we've just looked across 20 or 30 years of transportation network integration, it always hasn't gone all that well. We can look, you know, no further than TNT. So what are you guys doing from a systems perspective and maybe like a physical network and facility, pick up and delivery line off perspective that mitigates some of those risks. And what are the lessons learned thus far?

Speaker Change: No further than TMT. So what are you guys doing from a systems perspective, and maybe like a physical network and facility pickup and delivery line haul perspective that mitigate some of those risks and what are the lessons learned thus far.

Brie Carere: So what are you guys doing from a systems perspective, and maybe from a physical networking facility pickup and delivery, line haul perspective, that mitigates some of those risks? And what are the lessons learned thus far? Well, I'll start first and then maybe Brie can comment on it.

Rajesh Subramaniam: Well, I'll start first and then maybe break in comment on it. You know, absolutely, we are making sure that our customer experience actually gets better. And we now have a very rigorous process to drive the rigor and discipline that we have established on multiple projects that that associated with this is very critical. So, you know, we will we will follow this very carefully and rigorously and make sure that our customer experience gets better as we go through this process.

Rajesh Subramaniam: You know, absolutely, we are making sure that our customer experience actually gets better. And we now have a very rigorous process through drive, the rigor and discipline that we have established on multiple projects that are associated with this, are very critical. So, you know, we will follow this very carefully and rigorously and make sure that our customer experience gets better as we go through this process. The only thing that I would add, Brandon, is that when we look at Network 2.0, we've given ourselves time. From a pace perspective, we have built in the right cadence so that if we do need to pause, we can.

Well I'll start first and then let me briefly comment on it.

Speaker Change: Absolutely, we are making sure that our customer experience actually gets better.

And we now have a very rigorous process to drive the rigor and discipline that we have established multiple projects.

Speaker Change: Thats associated with this is very critical so we will we will follow this very carefully and rigorously and make sure that our customer experience gets better as we go through this process.

John Dietrich: The only thing that I would add, Brandon, is when we looked at network 2.0, we've given ourselves time. From a pace perspective, we have built in the right cadence so that if we do need to pause, we can; we haven't needed to. I think that's really important. The rigor and the planning and the technology and the tools that Scott Ray and John have worked services good. And in fact, as I mentioned previously, this also solves our single pickup feature service, which has been just a huge opportunity for us to move forward from small business acquisition.

The only thing that I would add Brandon is when we looked at network Ciudadano as we've given ourselves time.

Speaker Change: I'm a pace perspective, we have built and the right cadence so that if we do need to pause. We can we haven't needed to them I think that's really important the rigor and the planning and the technology and the tools that Scott ran John have.

Brie Carere: We haven't needed to. I think that's really important. The rigor and the planning and the technology and the tools that Scott, Ray, and John have worked. Service is good. And, in fact, as I've mentioned previously, this also solves our single pickup feature of service, which has been just a huge opportunity for us as we move forward from the small business acquisition. So, I feel really good.

Speaker Change: Have worked service is good and in fact as I've mentioned previously. This also solves our single pickup feature service, which has been just a huge opportunity for us and move forward from small business acquisition. So I feel really good service is the strongest in the market at Fedex.

Rajesh Subramaniam: So I feel really good; service is the strongest in the market at FedEx FEC. I guess I have to say moving forward, and I feel really good about the domestic network right now.

Thomas Wadewitz: Service is the strongest in the market at FedEx, FEC, I guess I have to say moving forward. And I feel really good about the domestic network right now. And our next question will come from Tom Wadewitz with UBS. Please go ahead. Yeah, good morning, or good morning, good afternoon. The days have gone by quickly.

Speaker Change: SEC I guess I'll have to say moving forward and I feel really good about the domestic network right now.

Tom Waterway: And our next question will come from Tom Waterways with UBS. Please go ahead. Yeah, good morning. So, or good morning. Good afternoon. This is going by quickly. Let's see. Wanted to see if you could give. I know you talked a little bit about the some of the factors in drive.

And our next question will come from Tom <unk> with UBS. Please go ahead.

John W. Dietrich: Let's see, I wanted to see if you could give, I know you talked a little bit about some of the factors in drive, but I wanted to see if you could give a little bit more, maybe on Europe. I think some of the cost savings you announced, the headcount reductions come a couple years out, not in fiscal 25 or the ramp in 26 and more so in 27. Can you give just a little more perspective on the changes in Europe and, you know, just how important the 600 million improvement in Europe is to the overall drive? Thank you. Thanks, Tom. It's John.

Speaker Change: Okay.

Speaker Change: Yes. Good morning, so good morning, good afternoon day.

Speaker Change: He has gone by quickly.

Speaker Change: Let's see wanted to see if you could give I know you talked a little bit about the some of the factors in drive wanted to see if you could give a little bit more maybe on Europe I think some of the cost savings you announced the head count reductions come a couple of years out not in fiscal 'twenty five or the ramp in 'twenty six and more so in 'twenty seven can you give.

John Dietrich: Wanted to see if you could give a little bit more, maybe on Europe. I think some of the cost savings you announced, the headcount reductions come a couple of years out, not in fiscal 25 or the ramp in 26 and more so in 27. Can you give just a little more perspective on the changes in Europe and, you know, just how important the 600 million improvement in Europe is to the overall drive. Thank you. Yeah, thanks, Tom. It's John. Yeah, the 600 million is very important to drive. And it's one of our top priorities. As Raj mentioned, we were all just in Europe last week, meeting with the team, the leadership, not only there to support them, but also to stress the urgency of how important it is.

Just a little more perspective on the changes.

In Europe and.

Just how important to $600 million improvement in Europe is to the overall drive thank you.

John W. Dietrich: Yeah, 600 million is very important to drive. And it's one of our top priorities. As Raj mentioned, we were all just in Europe last week, meeting with the team, the leadership, not only to support them but also to stress the urgency of how important this is. And we're looking at every aspect of our operation in Europe.

John W. Dietrich: Yes, Thanks, Tom It's John.

John W. Dietrich: The $600 million is very important to drive and it's one of our top priorities as Raj mentioned, we were all just in Europe last week meeting with the team the leadership not only there to support them, but also to stress the urgency of how important this is and we're looking at every aspect of our operation in Europe.

John Dietrich: And we're looking at every aspect of our operation in Europe.

John W. Dietrich: There will be new leadership as well, and we're going to continue to focus not only on the commercial side, but some operational efficiencies, including the network. There's also an opportunity now that we're in the full swing of network 2.0 implementation to leverage the expertise that John Smith and his team bring on the US side, which is where we're very strong, to work in coordination with our team in Europe. Something that's been done in the past, but we're really taking it to the next level.

Rajesh Subramaniam: There will be new leadership as well. And we're going to continue to focus not only on the commercial side but some operations of national efficiencies, including the network. There's also opportunity now that we're in Network 2.0, we'll swing of implementation to leverage the expertise that John Smith and his team bring on the US side, which is where we're very strong, the work and coordination with our team in Europe. Something that's been done in the past, but we're really taking it to the next level. So I think all those things are key, and we're serious about the 600 million. We look forward to updating you on our progress in the other category or in the other main categories.

John W. Dietrich: There will be new leadership, as well and we're going to continue to focus not only on the commercial side, but some operational efficiencies.

John W. Dietrich: <unk> the network.

John W. Dietrich: There is also opportunity now that we're in network <unk> will swing of implementation to leverage the expertise that John Smith.

John W. Dietrich: And his team bring on the us side, which is where we're very strong work in coordination with our team in Europe.

That's been done in the past, but we're really taking it to the next level.

John W. Dietrich: So I think all those things are key, and we're serious about the 600 million, and we look forward to updating you on our progress in the other main categories. Yeah, and Tom, the point that John just talked about is very important.

John W. Dietrich: So I think all of those things are key and we're serious about the $600 million and we'll look forward to updating you on our progress in the other category. The other main categories.

Rajesh Subramaniam: Yeah, and Tom, the point that John just talked about is very important. I think the biggest opportunity that we have in Europe is the intra-Europe theater. And that is ground-based. And we have a significant amount of interaction now between the management teams. And, you know, between Walter and Scott Ray, for example, and everyone below that. And also we have now established KPI dashboards that are, you know, very much provide real-time visibility on package flows and to improve service and reduce costs. So a lot of work going on here, very excited about what we can, what we can make happen.

Tom: Yeah, and Tom the point that John just talked about is very important I think the biggest opportunity that we have in Europe is the intra Europe theater and that has grown base and we have a significant.

Rajesh Subramaniam: I think the biggest opportunity that we have in Europe is the intra-Europe theater, and that is ground-based, and we have a significant amount of interaction now between the management teams and, you know, between Walter and Scott Ray, for example, and everyone below that, and also we have now established KPI dashboards that are, you know, very much provide real-time visibility on package flows and to improve service and reduce costs. There's a lot of work going on here. I'm very excited about what we can make happen. And our next question will come from John Chappell with Evercore ISI. Please go ahead. Thank you. Good afternoon.

Speaker Change: The amount of interaction now between the management teams.

Speaker Change: Between Boulder and spot rate for example, and everyone below that and also we have now.

Speaker Change: Establishing kpis dashboards.

That are very much provide real time visibility on packaged flows and to improve service and reduce cost. So a lot of work going on here very excited about what we can make happen.

John Chappell: And our next question will come from John Chappelle with Evercore ISI. Please go ahead. Thank you. Good afternoon. John, you pointed to the right side of the bridge again on the 2.2 billion. I think maybe some of the debate is that 2.2 billion growth or net. That feels like you're saying it's both.

Jonathan Chappell: John, you pointed to the right side of the bridge, again, on the $2.2 billion. I think maybe some of the debate is, is that $2.2 billion gross or net? It feels like you're saying it's both.

Speaker Change: And our next question will come from Jon Chapell with Evercore ISI. Please go ahead.

John W. Dietrich: How much of that is truly in your control, kind of independent of everything else going on in the macro environment and even the yield environment? And I guess the other part of it would be, if the non-heroic demand even doesn't play out the way that you've kind of expected it to, are there other kinds of variable cost levers to pull, or is this strictly just more of a structural drive cost initiative for Fiscal 25? Sure. Thanks, Tom. Yeah, the 2.2 is structural in nature.

Speaker Change: Thank you and good afternoon.

John you pointed to the right side of the bridge again on the $2 2 billion I think maybe some of the debate is that $2 2 billion.

Or net it feels like Youre, saying its both.

John Chappell: How much of that is truly in your control, kind of independent of everything else going on in the macro environment and even the yield environment. And I guess the other part, another part of that would be if the non-heroic demand even doesn't play out the way that you've kind of expected it to.

Speaker Change: How much of that is truly in your control kind of independent of everything else going on in the macro environment and even the yield environment and I guess the other part the other part of it would be if the non hurt ROIC demand even doesn't play out the way that you've kind of expected. It too are there other kind of variable cost levers to pull or is this strip.

John W. Dietrich: Are there other kinds of variable cost levers to pull, or is this strictly just more of a structural drive cost initiative for fiscal 25? Sure. Thanks, Tom. Yeah, the 2.2 is structural in nature. So, from our perspective, that is all within our control. And, you know, to the extent the macro environment doesn't cooperate, we're going to keep at it. The 2.2 includes projects that are in motion now. And, as I've said in prior calls, you know, some of our programs are going to over-deliver. Some may under deliver, but the pipeline is constant. So we're going to adapt aggressively, not only to the plans that are in place, but also to the change in the demand environment as well.

Speaker Change: Just more of a structural drive cost initiative for fiscal 'twenty five.

John W. Dietrich: So from our perspective, that is all within our control. To the extent the macro environment doesn't cooperate, we're gonna keep going. The 2.2 includes projects that are in motion now.

Speaker Change: Sure. Thanks, Tom.

2.2 is structural in nature, so from our perspective that is all within our control.

Speaker Change: And.

To the extent the macro environment doesn't cooperate.

Speaker Change: Going to keep at it the $2 to include the projects that are in motion now and as I've said in prior calls.

John W. Dietrich: And as I've said in prior calls, some of our programs are gonna over-deliver, some may under-deliver, but the pipeline is constant. So we're gonna adapt aggressively, not only to the plans that are in place, but also to the change in the demand environment as well. And John, look no further than what we did in FY24. And our next question will come from Jordan Alliger with Goldman Sachs. Please go ahead. Yeah, hi, afternoon.

Speaker Change: Some of our programs are going to over deliver so may under deliver but the pipeline is constant so we're going to adapt aggressively not only to the plans that are in place, but also to the change in the demand environment as well.

Rajesh Subramaniam: And John, look no further than what we did in FY34.

John W. Dietrich: And John look no farther than what we did in FY 'twenty four.

Jordan Alliger: And our next question will come from Jordan Aliger with Goldman Sachs. Please go ahead. Yeah, hi. Afternoon question. The sort of the load of mid single digit revenue growth that you talked about for the years, their way to think about the blend between the yield and volume, you know, is it 2 and 2 something along those lines. And then just sort of along those lines, I think you get some color around B2B volumes of we're demand of up 2% or so. I'm just sort of wondering, you know, with retailers maybe doing more of this just in time focus.

Jordan Alliger: Question: So the low to mid single-digit revenue growth that you talked about for the year, is there a way to think about the blend between yield and volume? You know, is it two and two, something along those lines, and then just sort of along those lines, I think you get some color around B2B volumes and demand of up 2% or so. I'm just sort of wondering, with retailers maybe doing more of this just-in-time focus these days, does that sort of play into B2B and fast cycle logistics companies like FEDA? Yeah, great question, Jordan.

Speaker Change: And our next question will come from Jordan <unk> with Goldman Sachs. Please go ahead.

Speaker Change: Yes, Hi afternoon question.

Speaker Change: Low to mid single digit revenue growth that you talked about for the year is there a way to think about.

Speaker Change: The blend between the yield and volume too.

Speaker Change: <unk> to something along those lines and then to sort of along those lines I think.

Speaker Change: Some color around <unk> volumes of <unk>.

Speaker Change: Demand is up 2%, so I'm just sort of wondering.

With retailers may be doing more of this just in time focus. These days does that sort of play into <unk> and fast cycle logistics companies like Fedex.

Jordan Alliger: If these days does that sort of play into B2B and fast cycle logistics companies like FETA. Thanks.

Brie Carere: Great question, Jordan. So as we think about this year's revenue plan, you will see it's the largely volume driven and it will be driven from a deferred and any commerce perspective. As we have just mentioned, we do think he commerce is going to outpace the B2B growth. To your point, from a speed perspective, we are actually seeing the speed conversation elevate in the market, especially with what we would consider sort of your tier one or your household brand. From a competition perspective, we're absolutely increasing that conversation; actually, there is increased demand from a speed perspective within it.

Brie Carere: So as we think about this year's revenue plan, you will see it be largely volume driven, and it will be driven from a deferred and an e-commerce perspective. As we have just mentioned, we do think e-commerce is going to outpace B2B growth. To your point, from a speed perspective, we are actually seeing this speed conversation escalate in the market, especially with what we would consider sort of your tier one or your household brand. From a competition perspective, we're absolutely increasing that conversation. Actually, there is increased demand from a speed perspective within it. So I hope that gives you a little bit more clarity, but we do see volume moving.

Yes, Great question, Jordan, So as we think about this year's revenue plan.

Speaker Change: You will see it be largely volume driven and it will be driven by deferred and in ecommerce perspective. As we had just mentioned we do think ecommerce is going to outpace the BW growth.

Speaker Change: Your point from a.

Speaker Change: Speed perspective, we are actually seeing the speed compensation elevate in the market.

Speaker Change: Especially with what we would consider sort of your tier one are your household brand.

Speaker Change: From a competition perspective, we're absolutely increasing that conversation and actually there is increased demand from a speed perspective with Annette.

Brie Carere: So I hope that gives you a little bit more clarity, but we do see volume moving from here.

Speaker Change: So I hope that gives you a little bit more clarity, but we do see volume moving throughout the year.

Brian Ossenbeck: And our next question will come from Brian Ossenbeck with JP Morgan. Please go ahead.

Brian Ossenbeck: And our next question will come from Brian Ossenbeck with J.P. Morgan. Please go ahead, asking questions. So Brie, maybe just to follow up on the demand environment, can you tell us what you expect from peak season and how the planning and integration and visibility, I guess, more importantly, is going with the major, The right information and the right ethics. And then John, can you just give us any sense, maybe I don't want to give too much guidance, but any sense in terms of how the drive, $2.2 billion, will roll out throughout the year. Thanks, So from a peak season perspective, you know, we had a really phenomenal peak last year. That's going to be hard to top. But if there's a team that can do it, it's John.

Speaker Change: And our next question will come from Brian <unk> with Jpmorgan. Please go ahead.

Brian Ossenbeck: Thank you, and thanks for taking the question.

Brian: Hey, good afternoon, thanks for taking the question.

Brie Carere: So brief, maybe just to follow up on the demand environment, it's also to expect from the season and how the planning and integration visibility gets more importantly is going with the major digital prior years, which has been a little bit harder to get maybe the right information in the right aspect in place, and then John, can you just give us any sense to maybe we'll give for the guidance, but any sense in terms of how the drive 2.2 billion will work. We'll allow throughout each quarter this year.

Maybe just to follow up on the demand environment.

Speaker Change: Probably peak season, and how the planning and integration visibility I guess more importantly is going with the major carriers all prior years, what's been a little bit harder too.

Speaker Change: It may be the right information and the right assets in place and then John can you just give us any sense of maybe when we gave the guidance, but any sense in terms of how to drive $2 2 billion will rollout throughout each quarter. This year.

Brie Carere: Thanks, Brian. So, come up peak season perspective; you know, we had a really phenomenal peak last year. That's going to be hard to talk, but if there's a team that can do it, it's John from a collaboration and insight. We are actually getting further integrated with our largest retailers, so we have even better information than we have ever had. So from my perspective, I think from an asset and an alignment with capacity, this peak, you know, I can't control the weather, nor can John Smith. You can do a lot of things, but you can't control the weather. But I do feel really good going into peak.

Speaker Change: Thanks.

Brie Carere: From a collaboration and insight perspective, we're actually getting further integrated with our largest retailers, so we have even better information than we ever had. So from my perspective, I think, from an asset and an alignment with capacity, this peak, you know, I can't control the weather, nor can John Smith. You can do a lot of things, but you can't control the weather.

Brian: Thanks, Brian So from a peak season perspective, we.

We had a really phenomenal peak last year, and that's going to be hard to top but if there's a team that can do it Jon.

Speaker Change: From a collaboration and an insight and we are actually getting further integrated with our largest retailers. So we have even better information than we have ever had.

Speaker Change: From my perspective, I think from an asset and an alignment with capacity. This peak I can't control the weather and Archon. John method, you can do a lot of things that you can't control the weather, but I do feel really good going into peak and in fact, we have taken all of our best practices from the United States and we are expanding them around the world. We just had an incredible heart.

Rajesh Subramaniam: But I do feel really good going into peak. And, in fact, we have taken all of our peak best practices from the United States, and we are expanding them around the world. We just had an incredible hot sale in Mexico domestic, as an example. So I feel pretty confident about peak season. Before John goes, I just want to make sure that, in terms of volume growth, what we're expecting is low single-digit volume growth for the year.

Rajesh Subramaniam: And in fact, we have taken all of our peak best practices from the United States, and we are expanding them around the world. We just had an incredible hot sale in Mexico domestic as an example.

Speaker Change: Ireland, Mexico domestic as an example, so I feel I feel pretty confident about peak season before John goes I, just want to make sure that.

John Dietrich: So I feel pretty confident about peak season before John goes. I just want to make sure that, you know, that on the terms of the volume growth, what we expecting is low single digit volume growth for the year. Yeah, and with respect to your question on drive, you know, the 2.2 billion, we are committed to that. And as I said, a number of plans already in place. We talked about the $600 million for Europe for Europe. You know, the majority of the savings will come from the surface network, and our legacy express operations is we're looking to optimize our processes and prove efficiencies there.

The terms of the volume growth, what we're expecting is low single digit volume growth for the year.

Rajesh Subramaniam: Yeah, and with respect, Brian, to your question on driving, you know, the 2.2 billion, we are committed to that. And as I said, a number of plans are already in place. We talked about $600 million for Europe.

Speaker Change: Yes, and with respect Brian to your question on drive the $2 2 billion, we are committed to that and as I said a number of plans are already in place we talked about the $600 million for Europe for Europe.

Speaker Change: The majority of the savings will come from the service network and our legacy Express operations as we're looking to optimize our processes and improve efficiencies there.

John Dietrich: And GNA, IT, and procurement will be key drivers for the savings. I know you asked about the timing of that, but we look forward to keeping you updated as these plans solidify and as the year progresses.

Speaker Change: G&A.

And procurement will be key drivers for the savings I know you asked about the timing of that but we look forward to keeping you updated as these plans solidify and as the year progresses.

John W. Dietrich: You know, the majority of the savings will come from the service network and our legacy express operations as we're looking to optimize our processes, improve efficiencies there. GNA, IT, and procurement will be key drivers for the savings. I know you asked about the timing of that, but we look forward to keeping you updated as these plans solidify and as the year progresses. And our next question will come from Bascome Majors with Susquehanna.

Bascome Majors: And our next question will come from Basque majors with Susquehanna. Please go ahead. For the domestic community, we, it's very clear to see the potential benefits of separating the last and trouble of business, just looking at multiples and investigate a million there last three or four years. What do we miss when looking at the other side of that? You know, what do you lose? What are you thinking about as the offset that, you know, we make that decision over the next six or so months. Thank you.

Speaker Change: And our next question will come from vascular majors with Susquehanna. Please go ahead.

Speaker Change: Okay.

Speaker Change: For the investment community.

Speaker Change: To be clear to see the potential benefits.

Speaker Change: Of separating the less than truckload businesses looking at multiples.

John W. Dietrich: Please go ahead. For the investment community, it's very clear to see the potential benefits of separating the less than truckload business, just looking at the multiples and investor favorability there over the last three or four years. But what do we miss when looking at the other side of that? What do you lose?

Speaker Change: Best in favor ability there over the last three or four years, what do we miss when looking at the other side of that what are your news what are you thinking about.

Bascome Majors: What are you thinking about as the offset for that when you make that decision over the next six or so months? Thank you. Bascome, as I said before, I'm not going to comment too much more on this.

Speaker Change: Has the offset.

Speaker Change: That decision over the next six or so months. Thank you.

Rajesh Subramaniam: We have already said, you know, historically about what value FedEx is part of the network. We'll do the full analysis. And again, like I said, it's going to be very thorough. And when we have something to talk about, we will definitely communicate it. And our next question will come from Ravi Shanker with Morgan Stanley. Please go ahead.

Rajesh Subramaniam: Bascome, as I've said before, I'm not going to comment too much more on this. We have already said, you know, historically about what value FedEx is part of the network. We'll do the full analysis. And again, like I said, it's going to be very thorough, and when we have something to talk about, we will definitely communicate it.

Speaker Change: Bascom as I've said before I'm not going to comment too much more on this.

Speaker Change: I've already said historically about what value vertex as part of the network will do the full analysis and again like I said, it's going to be very thorough and.

Speaker Change: When we have something to talk about we will definitely communicate it.

Ravi Shanker: And our next question will come from Ravi Shanker with Morgan Stanley. Please go ahead. Thanks for the number, everyone. I just want to confirm that the head-con reductions in Europe were they part of drive? I mean, given that, you're going to see the benefit of that in FY27 is wondering if that was incremental. And also, kind of when you think of the actions they're taking right now, how much of that is commercial, kind of operating, kind of revenue-driven versus actual cost-cutting in Europe?

Speaker Change: Yes.

Speaker Change: And our next question will come from Ravi Shanker with Morgan Stanley. Please go ahead.

Ravi Shanker: Thanks a lot, everyone. I just want to confirm that the headcount reductions in Europe were part of the drive? I mean, given that, you're going to see the benefit of that in FY27. Just wondering if that was incremental.

Ravi Shanker: Thanks, Good afternoon, everyone just wanted to confirm that the headcount reductions in Europe.

Are they part of driving I mean, given that you're going to see the benefit of that in FY 'twenty. Seven just wondering if that was incremental and also when you think of the actions you're taking right now how much of that is commercial kind of operating revenue driven versus actual cost cutting in Europe. Thank you.

John W. Dietrich: And also, when you think of the actions you're taking right now, how much of that is commercial, kind of operating, revenue-driven versus actual cost-cutting in Europe? Thank you. So it's certainly in line with the DRIVE philosophy, and because some of the benefits are going to flow beyond the DRIVE FY25 period, but we haven't included it in that number. And it truly is cost takeout.

Rajesh Subramaniam: Thank you. So it's certainly in line with the drive philosophy. And because some of the benefits are going to flow beyond the drive FY25 period, where we haven't included it in that number. And it truly is cost-take-out. These are non-operational positions. And we look forward to keeping you posted.

Ravi Shanker: So.

Speaker Change: It's certainly in line with the drive philosophy, and because some of the benefits are going to flow beyond the drive FY 'twenty five period, but we haven't included in that number.

Speaker Change: And it truly is cost takeout these are non operational positions and.

John W. Dietrich: These are non-operational positions, and we look forward to keeping you posted. And our next question will come from David Vernon with Bernstein. Please go ahead.

Speaker Change: We look forward to keeping you posted.

David Vernon: And our next question will come from David Vernon with Bernstein. Please go ahead. Hey guys, and thanks for the time. So, Roger, I hate to come back to the same topic again. But when you were with us a few weeks ago here in New York, you were sounding like it was a little bit more of your moving in the direction anyway of more closely. So that's obviously integrating some of the freight stuff with the Tri-Color Network strategy. So our question for you is really kind of what's changed in the thinking in the last couple of weeks?

Speaker Change: And our next question will come from David Vernon with Bernstein. Please go ahead.

David Vernon: Hey guys, and thanks for the time. So Raj, I hate to come back to the same topic again, but when you were with us a few weeks ago here in New York, you were sounding like it was a little bit more of, you're moving in the direction anyway, of more closely integrating some of the freight stuff with the tricolor network strategy. So my question for you is really kind of what's changed in the thinking in the last couple weeks? Like, what's the emphasis on the decision to do a review here?

David Vernon: Hey, guys. Thanks for the time, so Raj I hate to come back to the same topic again, but when you were with US a few weeks ago here in New York, you're sounding like it was a little bit more.

Speaker Change: Youre moving in the direction anyway of more closely integrating some of the freight stuff with the Tri color network strategy. So a question for you is really kind of what's changed in the thinking in the last couple of weeks like what's what's the impetus for the decision to do a review here and second secondly, as you think about what that review will mean are there any downstream applications for that trial.

Rajesh Subramaniam: What's the emphasis for the decision to do a review here? And secondly, as you think about what that review will mean, are there any downstream implications for that Tri-Color Network strategy that we should be thinking about? Well, you know, David, thank you for the question. You know, as we've heard from several investors and analysts in this regard, and obviously we've taken from our shareholders very, very seriously. And so this is the right time in our natural planning calendar. As for us Tri-Color, those no changes. We're moving on ahead. Thank you.

Rajesh Subramaniam: And secondly, as you think about what that review will mean, are there any downstream implications for that tricolor network strategy that we should be thinking about? Well, you know, David, thanks for the question. You know, as we've heard from several investors and analysts in this regard, and obviously, we take input from our shareholders very, very seriously. And so this is the right time on our natural planning calendar. As far as the strike order goes, no changes.

Speaker Change: Our network strategy that we should be thinking about.

Speaker Change: Well David.

Speaker Change #100: Thanks for the question as we've heard from several investors and analysts in this regard and obviously, we've taken from our shareholders very very seriously and so this is the right time and our national plan in calendar <unk> striker logos no changes we're moving on ahead. Thank you.

Stephanie Lynn Benjamin Moore: And our next question will come from Stephanie Moore with Jefferies. Please go ahead. Hi, good afternoon. Thank you. You know, maybe a question for Bri here. You noted, you're pleased by the pricing capture that you've been able to achieve, noted in light of the current pricing environment. Can you maybe talk a little bit about what you're seeing in the current pricing environment from a competitive standpoint or overall rationality? Thanks.

Stephanie Lynn Benjamin Moore: We're moving on ahead, and our next question will come from Stephanie Moore with Jeffreys. Please go ahead.

Speaker Change #101: And our next question will come from Stephanie more with Jefferies. Please go ahead.

Brie Carere: Hi, good afternoon. Thank you. Maybe I have a question for Brie here.

Stephanie Lynn Benjamin Moore: Hi, good afternoon. Thank you.

Speaker Change #103: Maybe a question for Barry here.

Barry: You are pleased by the pricing capture that <unk> been able to achieve.

Stephanie Lynn Benjamin Moore: In light of the current pricing environment could you maybe talk a little bit about what youre seeing in the current pricing environment.

Speaker Change #105: A competitive standpoint, our overall rationality.

Stephanie Lynn Benjamin Moore: Yeah.

Brie Carere: Sure. Thanks, Stephanie. So, from a market perspective, it absolutely is competitive. That's nothing particularly new in this market. So it's competitive, but it's rational. I think our team has been very disciplined. We have absolutely been able to maintain the yield increases that we captured in CY22 and CY23 and then built on there. I think it's also really important to note that we're very focused not just on total yield, but getting yield in the right place where we need it. So, for example, I think our team is doing the very best in the market at getting peak surchargers.

Brie Carere: You noted that you're pleased by the pricing capture that you've been able to achieve, noted in light of the current pricing environment. Can you maybe talk a little bit about what you're seeing in the current pricing environment from a competitive standpoint or overall rationality? I think our team is doing the very best in the market at getting peak surcharges. I should have said that when the peak question just came up.

Stephanie Lynn Benjamin Moore: Sure. Thanks, Stephanie so from a market perspective, it absolutely is competitive nothing, particularly new in the market. So its competitive but its rationale I think our team has been very disciplined we have absolutely been able to maintain the yield increases that we captured in 2022 and <unk>.

Stephanie Lynn Benjamin Moore: 'twenty three and then bolt on there I think it's also really important to note that we're very focused not just on total yield by getting yield in the right place, where we need it. So for example, I think our team is doing the very best in the market at getting peak surcharges.

Brie Carere: The team has done a really good job getting the increase we need to deliver an amazing peak where we do have to expand capacity. The same goes to rural coverage as well as large packages. So yes, it's competitive, but I think the team is doing a really good job of navigating the kind of market share, profit market share growth with getting the right yield for the right package and working really, really closely with the operation. So I'm incredibly excited, and our next question will come from Bruce Chan with Stiefel. Please go ahead.

Brie Carere: You know, I should have said that when the peak question just came up, the team has done a really good job in getting the increase we need to deliver an amazing peak where we do have to expand capacity. The same goes to rural coverage as well as large packages. So yes, it's competitive, but I think the team is doing a really good job of navigating kind of market share, profit market share growth with getting the right yield for the right package and working really, really closely with the operation. So I mean, incredibly.

Speaker Change #106: <unk> said that when the peak question just came up the team has done a really good job in getting the increase we need to deliver an amazing peak, where we do have to expand capacity. The same goes to where all coverage as well as large packages. So yes, it's competitive but I think the team is doing a really good job of navigating kind.

Speaker Change #106: Market share profit market share grow with getting the right yield for the right package and working really really closely with the operations finding incredibly please.

Unknown Attendee: Please.

Unknown Attendee: In our next question, we'll come from Bruce Chan with Stephen. Please go ahead. Hey, thanks, and good afternoon, everyone. Lots of good and interesting stuff happening here, but maybe just switching gears a little bit. We've got some elections coming up and just curious, you know, how big of an issue, you know, tariffs have been as part of a, you know, your customer discussions today. And you know, maybe more specifically just giving your commentary, Brie, around China, e-commerce. You know, you've got a couple of big direct e-commerce customers. Can you just, you know, maybe remind us of how big they are right now as a percentage of your book and, you know, what's maybe the risk of all you've seen if there is a change in trade policy.

Speaker Change #107: And our next question will come from Bruce Chan with Stifel. Please go ahead.

Unknown Attendee: Hey, thanks. And good afternoon, everyone. Lots of good and interesting stuff happening here. But maybe, you know, switching gears a little bit.

Speaker Change #108: Hey, Thanks, and good afternoon, everyone.

Unknown Attendee: Lots of good and interesting stuff happening here, but maybe just switching gears a little bit we've got some elections coming up and I'm just curious how big of an issue.

Unknown Attendee: Tariffs have been as part of our.

Your customer discussions to date and maybe more specifically just given your commentary around China E Commerce.

Speaker Change #110: <unk> got a couple of big direct E. Com customers can you just maybe remind us of how big they are right now as a percentage of your book and whats maybe the risk of volumes here. If there is change in trade policy.

Brie Carere: Sure, I'll start with the last question, and then I'll certainly turn it to the boss to talk about the overall terror situation. So, from an e-commerce perspective, yes, e-commerce is the largest driver of intercontinental out of China, but actually around the world. Both domestically and internationally, we are really proud of how diversified our revenue basis. Yes, we have a great relationship with all of the major e-commerce players out of China, but the benefit of those customers is that they're really large. And so we can partner with them to find the right solutions, what makes sense for us, as well as what makes sense for them.

Brie Carere: We've got some elections coming up, and just curious, you know, how big of an issue tariffs have been as part of your customer discussions today. And, you know, maybe more specifically, just given your commentary, Brie, around China eCommerce, you know, you've got a couple of big direct eCom customers. Can you just, you know, maybe remind us of how big they are right now as a percentage of your book?

Speaker Change #111: Sure I'll start with the last question and then I'll certainly turn it to the boss to talk about at the overall tariff situation. So from an E. Commerce perspective, Yes E. Commerce is the largest driver of Intercontinental out of China, but actually around the world both domestically and internationally.

Brie Carere: And, you know, what's the risk to volumes here if there is a change in trade policy? Sure, I'll start with the last question and then I'll certainly turn it to the boss to talk about the overall tariff situation.

Speaker Change #112: We are really proud of how diversified our revenue base says, yes, we have a great relationship with all of the major E Commerce players out of China.

Brie Carere: So from an e-commerce perspective, yes, e-commerce is the largest driver of intercontinental out of China, but actually around the world, both domestically and internationally. We are really proud of how diversified our revenue base is. Yes, we have a great relationship with all of the major e-commerce players in China, but the benefit of those customers is that they're really big, and so we can partner with them to find the right solution, what makes sense for us, as well as what makes sense for them. No one carrier can serve their entire needs.

Speaker Change #112: But the benefit of those customers is that they are really large and so we can partner with them to find the right solution what makes sense for us as well as what makes sense for them no one carrier conserved their entire needs and I think we've found a very productive and profitable relationship.

Brie Carere: No one carrier can serve their entire needs. And I think we found a very productive and profitable relationship.

Rajesh Subramaniam: And I think we have found a very productive and profitable relationship. And again, I do want to emphasize the very diversified base. Thanks.

Rajesh Subramaniam: And again, I do want to emphasize a very diversified base, thanks. And on a broader point here, you know, the trade as a percentage of GDP is essentially flatlines since about 2016. So we've been operating in this environment for some time. Now, it's important to note that the trade patterns are fundamentally shifting. I think the good news for FedEx is our network. We are here, there, and everywhere. And that we get the intelligence from the market at the ground level. That is, you know, we are referring them on a global supply chain every single day.

Speaker Change #112: And again I do want to emphasize very diversified base. Thanks.

Rajesh Subramaniam: And on the broader point here, you know, trade as a percentage of GDP has essentially flatlined since about 2016. So we've been operating in this environment for some time. Now, it's important to note that trade patterns are fundamentally shifting, and the good news for FedEx is our network. We are here, there, and everywhere. And that we get intelligence from the market at the ground level. You know, that is, we are referendum on a global supply chain every single day.

Speaker Change #112: And on the broader point here.

Speaker Change #112: Trade as a percentage of GDP is essentially pipeline since about 2016. So we've been operating in this environment. Some time now.

Speaker Change #112: To note that the trade patterns, so fundamentally shifting and the <unk>.

Speaker Change #113: Good news for Fedex as our network, we are here there and everywhere.

We get the intelligence from the market at the ground level.

Speaker Change #113: As you know.

Speaker Change #113: We are learning from them on a global supply chain every single day, and so because of that we are able to react very quickly much more much faster than manufacturing can move and.

Rajesh Subramaniam: And so because of that, we are able to react very quickly, much more, much faster than manufacturing can move. And, you know, so the supply chain pattern change actually works in our favor in many ways because the only companies that have established networks that connect all these countries and actually do these things. So, for example, when our manufacturing moves to Mexico, we have a significant presence in Mexico and the United States. In fact, in our competitive set, we are the only one who can say that with conviction.

Rajesh Subramaniam: And so, because of that, we are able to react very quickly, much faster than manufacturing can move. And, you know, so the supply chain pattern changes actually works in our favor in many ways because it's only the only companies that have established networks that connect all these countries can actually do these things. So, for example, when no manufacturer moves to Mexico, we have a significant presence in Mexico and the United States. In fact, our competitive set, we are the only one who can say that with conviction. So, you know, while we see the overall trade trends flatten out, there are opportunities as supply chain patterns change.

Speaker Change #113: So the.

Speaker Change #113: The supply chain pattern changes actually.

Speaker Change #113: It works in our favor in many ways because the only the only companies that have it.

Speaker Change #113: Stablish networks that connect all of these countries and actually do these things. So for example, when no manufacturing moves to Mexico, we have a significant presence in Mexico, and the United States and in fact, one of our competitive set we are the only one who can say that with conviction.

Rajesh Subramaniam: So while we see the overall trade trends flatten out, there are opportunities as supply chain patterns change. And again, the established networks that we have in place and the digital tools that we now have make us very compelling. And this will conclude our question and answer session. I would like to turn the conference back over to Raj Subramaniam for any closing remarks. Thank you, operator. Before we wrap up, I want to congratulate Rob Cotter once again on his upcoming retirement after more than 30 years of dedication and service to FedEx.

Speaker Change #113: <unk>.

Speaker Change #113: While we see the overall trade trends flatten out there are opportunities of supply chain patterns change.

Rajesh Subramaniam: And again, you know, we are established networks that we have in place, and the digital tools that now have makes us very compelling.

And.

Speaker Change #113: Again.

Speaker Change #113: Our established networks that we have in place and the digital tools have now have makes it very compelling.

Unknown Attendee: And this will conclude our question-and-answer session.

Speaker Change #114: And this will conclude our question and answer session I would like to turn the conference back over to Raj Subramaniam for any closing remarks.

Rajesh Subramaniam: I would like to turn the conference back every two rows. She by money on for any closing remarks. Thank you, operator. Before we wrap, I want to congratulate Rob Carter. Once again, on his upcoming retirement, up for more than 30 years of dedication and service to FedEx. I also want to take this opportunity to welcome Sri Ramakrishna Swami into his expanded role as Chief Digital and Information Officer, effective next week.

Rajesh Subramaniam: Thank you operator, before we wrap I want to congratulate Rob Carter once again on his upcoming retirement after more than 30 years of dedication and service to Fedex.

Rajesh Subramaniam: I also want to take this opportunity to welcome Sriram Krishnaswamy into his expanded role as Chief Digital and Information Officer, effective next week. In closing, I'm extremely proud of our FedEx team for a strong end to a year of incredible performance. Margin expansion and operating profit growth for four consecutive quarters despite revenue declines in three of those quarters is a tremendous achievement. I'm excited about the opportunities ahead as we continue to focus on enhancing our profitability and stockholder returns while providing outstanding service for our customers.

Rajesh Subramaniam: Also want to take this opportunity to welcome Chris.

Speaker Change #115: <unk> saw me into his expanded role as chief digital and information officer effective next week.

Rajesh Subramaniam: In closing, I'm extremely proud of our FedEx team for a strong end to a year of incredible performance. Margin expansion, an operating profit growth for four consecutive quarters, despite revenue decline in three of those quarters, is a tremendous achievement. I'm excited about the opportunities ahead as we continue to focus on enhancing our profitability and stockholder returns while providing outstanding service for our customers. Thank you very much.

Speaker Change #115: In closing I am extremely proud of our Fedex team for a strong end to euros.

Speaker Change #115: Incredible performance.

Speaker Change #115: Margin expansion and operating profit growth for four consecutive quarters. Despite revenue decline and three of those quarters is a tremendous achievement IMAX.

Speaker Change #115: I am excited about the opportunities ahead as we continue to focus on enhancing our profitability and stockholder returns, while providing outstanding service for our customers. Thank you very much.

Unknown Attendee: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Rajesh Subramaniam: Thank you very much. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. Transcript Emily Beynon

Speaker Change #116: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Speaker Change #116: Yes.

Speaker Change #116: [noise].

Speaker Change #116: Okay.

Speaker Change #117: [noise] [music].