FedEx(FDX)2023-07-16 16:00Digital and Physical Customer Experience Enhancement - FedEx Dataworks merged with ShopRunner in 2023 to enhance digital and physical customer experiences[12] - FedEx expanded Picture Proof of Delivery to 90% of global residential deliveries[22] - FedEx introduced FedEx Sustainability Insights in the U.S., a cloud-based engine for emissions data[23] - FedEx introduced the FedEx Sustainability Insights tool in 2023 to estimate CO2e shipping emissions at package and account levels using near-real-time network data[59] - FedEx Mobile app is available in over 220 countries and territories and supports 40 languages, with SMS Notifications available in five countries[111] - FedEx OnSite network includes nearly 17,000 Walgreens, Dollar General, and Albertsons stores, in addition to approximately 2,000 FedEx Office locations[114] - FedEx Extra Hours service allows retailers to extend evening order cutoff times by five to eight hours, with some as late as midnight[115] - FedEx Office operates approximately 2,000 customer-facing stores as of May 31, 2023, offering printing, shipping, and e-commerce solutions[125][126] - FedEx Office launched FedEx Consolidated Returns in 2023, allowing shoppers to return items without a box or label at FedEx Office locations[129] Operational Consolidation and Network Optimization - FedEx announced "One FedEx" consolidation plan to integrate FedEx Express, FedEx Ground, and FedEx Services into a single company by June 2024[15] - Network 2.0 implementation began in over 20 markets, with FedEx Ground operations in Canada transitioning to FedEx Express starting April 2024[16] - FedEx Express's 2016 acquisition of TNT Express enhanced its global footprint and operational efficiency, with physical network integration completed in 2022[66] - FedEx Express entered into a strategic alliance with Delhivery, a leading logistics and supply chain services company in India, in 2022[67] - FedEx Ground introduced advanced route optimization technology leveraging FedEx Dataworks for near real-time delivery route planning[95] - FedEx Dataworks collaborates with Adobe, Salesforce, Microsoft, and FourKites to enhance e-commerce logistics and supply chain visibility, with integrations starting in 2021 and 2022[116] - FedEx Surround provides near-real-time analytics for shipment tracking, improving logistics and inventory management for business customers[124] Sustainability and Environmental Initiatives - FedEx introduced FedEx Sustainability Insights in the U.S., a cloud-based engine for emissions data[23] - The company plans to transition the entire FedEx parcel pickup-and-delivery fleet to zero-tailpipe emissions electric vehicles by 2040, with 50% of FedEx Express global pickup-and-delivery vehicle purchases expected to be electric by 2025[49] - FedEx Express has taken delivery of 500 BrightDrop electric vehicles as of June 2023 and aims to increase vehicle fleet efficiency by 50% from a 2005 baseline by 2025[50][51] - The company has a goal of obtaining 30% of its annual jet fuel usage from blends of alternative fuels by 2030[53] - Since 2005, the company has reduced overall aircraft emissions intensity by 28%, with the FedEx Fuel Sense program saving 13 million gallons of jet fuel in 2022[54] - In 2022, the company generated on- and off-site solar energy at 29 locations across its operating companies[57] - FedEx-branded cardboard packaging is 100% recyclable and contains an average of 36% recycled content, with 64% of FedEx-branded packaging being third-party certified in 2022[58] - The International Civil Aviation Organization (ICAO) adopted the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), with a new baseline of 85% of 2019 emissions due to COVID-19 impacts[153] - The EU Emissions Trading Scheme (ETS) requires airlines to purchase emissions allowances or sustainable aviation fuel if they exceed free allowances, with potential expansion to international flights from 2026[154] - Compliance with CORSIA and ETS is expected to increase FedEx's operating expenses, depending on factors such as flight volume, fuel efficiency, and sustainable fuel usage[155] - ICAO adopted new carbon dioxide emissions standards effective from 2023, with a production cutoff date of January 1, 2028, for non-compliant aircraft[157] Employee Development and Benefits - FedEx exceeded its FedEx Cares 50 by 50 goal, positively impacting 50 million people by April 2023[23] - FedEx covers approximately 70% of total eligible health and disability costs for 212,000 U.S. employees as of May 2023[34] - FedEx Learning Center offers over 25,000 online courses for employee development[35] - FedEx's Learning inspired by FedEx (LiFE) program provides tuition-free online degree options for eligible U.S. employees[36] - Globally, in 2022, the company hired over 558,000 full- and part-time team members, with part-time turnover at 205% and full-time turnover at 32% in 2023[39] - As of May 31, 2023, the company employed approximately 328,000 permanent full-time and 201,000 permanent part-time employees, with FedEx Ground utilizing nearly 7,000 contracted service providers[40] - FedEx Express employs approximately 188,000 permanent full-time and 56,000 permanent part-time employees as of May 31, 2023[82] - FedEx Ground employs approximately 56,000 permanent full-time and 136,000 permanent part-time employees, and contracts with nearly 7,000 independent small businesses for operations[96] - FedEx Freight employs approximately 43,000 employees[103] - FedEx Logistics employs approximately 21,000 people as of May 31, 2023, providing air and ocean cargo transportation, customs brokerage, and supply chain solutions[134] - FedEx Supply Chain employs approximately 15,000 people across 82 facilities as of May 31, 2023, providing integrated logistics services for various industries[137] Pricing and Financials - FedEx Express implemented a 6.9% average list price increase for U.S. domestic, U.S. export, and U.S. import services effective January 2, 2023[71] - FedEx Ground implemented a 6.9% average list price increase for FedEx Ground and FedEx Home Delivery services effective January 2, 2023[88] - FedEx Freight implemented a 6.9% average list price increase for FXF PZONE and FXF EZONE rates and a 7.9% increase for FXF 1000 and FXF 501 rates effective January 2, 2023[104] - FedEx Express's total jet fuel cost in fiscal year 2023 was 17.5 billion as of May 31, 2023, with a market risk of 236 million[425] - The company maintains derivative financial instruments to manage foreign currency fluctuations, with immaterial profit or loss recorded in 2023 and 2022[426] - Market risk for jet and vehicle fuel price changes is largely mitigated by indexed fuel surcharges[426] International Services and Operations - FedEx International Economy provides time-definite delivery typically in two to five business days to more than 220 countries and territories[64] - FedEx International First offers delivery to select U.S. ZIP Codes as early as 8:00 a.m. from more than 90 countries and Caribbean islands in one or two business days[64] - FedEx International Connect Plus, available from nearly 60 origin countries to over 195 destination countries, provides day-definite delivery typically within two to five business days[65] - FedEx Express participates in the Civil Reserve Air Fleet (CRAF) program, allowing the U.S. Department of Defense to requisition aircraft during national emergencies, with compensation at standard contract rates[145] - FedEx Express's international operations are subject to regulatory challenges, including bilateral agreements and foreign government permissions, which can impact operational efficiency[148] Technology and Innovation - FedEx Ground is testing autonomous, driverless technologies for large packages and AI-enabled robotic product sortation systems for small packages[94] - FedEx is testing Nuro's next-generation autonomous delivery vehicles and Aurora's autonomous driving technology in its operations, with plans to explore multi-stop and appointment-based deliveries[117][118] - FedEx Dataworks leverages its global network data to optimize operations, including dynamic pricing infrastructure and predictive anomaly detection for revenue quality[123] Fleet and Infrastructure - The company plans to deploy an additional six Boeing 777 Freighter aircraft during 2024 and 2025, along with 24 Boeing 767-300 Freighter aircraft[56] - FedEx Ground operates over 700 sortation and distribution facilities, including more than 160 fully automated stations, and utilizes more than 100,000 vehicles owned or leased by independent service providers[92] - FedEx Freight operates nearly 30,000 vehicles from a network of approximately 390 service centers and employs approximately 43,000 employees[103] - FedEx Freight Direct offers through-the-door services to 90% of the continental U.S. population and to-the-door services to nearly 100% of the U.S. population[102] Regulatory and Compliance - The FCC expanded the use of the 3.7 to 4.2 GHz spectrum band for 5G networks, leading to FAA airworthiness directives requiring radio altimeter retrofits by July 2023, which FedEx Express has complied with[151] - FedEx Express's aircraft fleet complies with current federal noise standards, but local airport noise regulations can restrict operations in certain areas[152] - The EPA proposed regulations in 2022 to categorize certain PFAS as hazardous substances, potentially subjecting FedEx to cleanup costs for historical contamination[158] E-commerce and Supply Chain Solutions - FedEx Fulfillment supports small and medium-sized businesses with e-commerce order fulfillment and inventory management across multiple channels[138] - FedEx Trade Networks Transport & Brokerage operates 122 offices in 33 countries as of May 31, 2023, offering global trade solutions and customs clearance services[136] - FedEx Supply Chain employs approximately 15,000 people across 82 facilities as of May 31, 2023, providing integrated logistics services for various industries[137]