FedEx (FDX) Baird 2024 Global Industrials Conference summary

Strategic priorities and transformation

• Focused on DRIVE, Network 2.0, and Tricolor initiatives to improve earnings, margins, and ROIC.

• Transitioned to a One FedEx structure, centralizing finance, procurement, and capital allocation.

• Leveraged cross-functional talent and centralized discipline for capital spend.

• Digital transformation and operational integration are key priorities.

DRIVE and Network 2.0 initiatives

• Achieved $1.8B in savings in FY24; targeting $2.2B in FY25 with $390M delivered so far.

• DRIVE is a business philosophy, not just cost-cutting; some initiatives delayed but full savings expected.

• Network 2.0 integrates facilities, personnel, and technology, with full rollout targeted by FY27.

• Adjustments made during peak season to avoid service disruption; learnings applied station by station.

Market dynamics and peak season

• Extensive planning ensures readiness for peak season in staffing and capacity.

• Adaptable to global trade shifts and regulatory changes, with strong Washington, D.C. engagement.

• Pricing environment remains rational but competitive; peak surcharges and GRI higher than anticipated.